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Chapter 5 –- Contemporary Challenges to Property Rights (pp. 177-220)
Chapter 5 starts with a case study (pp. 177-186) entitled “W. R. Grace & Co. and the Neemix Patent
(A).” In this case study, we see a description of the Indian (indigenous to the country of India) neem
tree, and the fact that it has been known for many centuries to be a beneficial plant. Among the uses
for this plant have been to use it, its leaves, its seeds, and cake derived from its seeds to keep insect
pests away. It seemed clear that a compound within this plant served as a natural pesticide. The
compound was determined to be azadirachtin. This compound however, decomposed rapidly. W. R.
Grace & Co. discovered neither the neem tree, its uses, nor azadirachtin. However they did discover a
way of stabilizing the compound so that it would last a long time. This stabilized version was patented
by Grace. The last three pages of this case study detail the protests Grace faced by those who felt it
was either stealing from the poorest Indians or was trying to hijack a natural substance for its own
profit, along with the response to those complaints.
Teaching Hint: This case study immediately gives rise to the potential for class discussion as to what
should be the proper subject of patent and trademark law, recognizing that patents and trademarks
essentially yield monopoly power.
Article: “Needed: A New System of Intellectual Property Rights” by Lester C. Thurow (pp. 187 –
196)
In his article, “Needed: A New System of Intellectual Property Rights,” Lester C. Thurow recognizes
the changing landscape of intellectual property, and the need for new system (or at least a strong
revision of the old system) to deal with intellectual property claims in the 21st Century and beyond.
Article: “Privacy” by Deborah G. Johnson (pp. 196 – 220)
In her article on privacy, Deborah G. Johnson begins by giving us a fictional case study in which a
development office rat a private university is able to find at least 10 pieces of information about a
potential large donor that would be able to influence the donor, and all these pieces of information are
found in public databases on the Internet.
The immediate question is: Has anything wrong been done in finding all this background information
on a private individual? And will anything wrong be done if the university uses this information when
soliciting contributions from this person?
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Other cases she raises involve a public employee taking computer data home either by laptop
computer or by disk (and perhaps these days by a “thumb drive” or other portable storage device),
employers monitoring the actual keyboard keystrokes of employees, and data mining by credit card
companies to determine where to solicit potential borrowers.
Next, Johnson raises the question, “Is there anything new here?” Information about everyone existed
long before the Internet. Is the information new, or is the quantity new, or is the accessibility of the
information new, or is there something about the quality of the information that is new? Certainly this
seems like a modern problem and not something that has been around for centuries.
Johnson mentions that the Privacy Act of 1974 restricted data matching, but that this was only
regarding data matching by governmental agencies.
Johnson, of course, mentions that the misuse of data can happen accidentally (by loss or inadvertent
use when one is really not authorized to use the data) as well as on purpose.
The central question becomes one of “balancing the needs of those who use information about
individuals against the needs and rights of those individuals whom the information is about.” She
believes the right to privacy is both limited and complex.
She distinguishes between privacy as an instrumental good (leading to something else) and privacy as
an intrinsic good (good in and of itself). She also discusses the fact that information always affects
relationships. And she gives arguments for and against believing that intrusions into our privacy have
already gone too far.
Although it has not been implemented, she speaks of the “Code of Fair Information Practices,” which
consists of the five principles outlined on page 215, and also of the European Union policy on data
quality, which is outlined on page 216.
The conclusion, of course, is that we need to do something, but the “what” is largely left up to us
individually and to society. The components of whatever is to be done, she believes, will include the
handling of technology, institutional policies, and personal actions.
Discussion Questions
1. A patent creates, essentially, a legal monopoly. If you hold a patent, you control the rights to
produce something for a period of time. The rationale behind granting patents is that they
encourage research because a researcher knows he or she will be able to reap the full rewards
of their research. Does this rationale make sense to you? Does your answer change if the
product is priced higher than you wish it to be?
2. You want to keep all your confidential information completely confidential. This prevents you
from opening a bank account and from buying anything over the Internet or phone. Are these
results fair?
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3. Lester Thurow, in an article entitled “Needed: A New System of Intellectual Property Rights”
posits that “it is clear that the invention of a new gene for making human beings different or
better cannot be handled in the same way as the invention of a new gearbox.” Do you agree
that this conclusion is self-evident? Why or why not?
Resources for further study — Film, Literature, and the Web:
Fisher, William. Theories of Intellectual Property. in Stephen Munzer, ed., New Essays in the Legal
and Political Theory of Property (Cambridge University Press, 2001)
Http://www.law.harvard.edu/faculty/tfisher/iptheory.html
Montana State University, “Technology Transfer: Patents Corner.” December 1995.
http://www.montana.edu/wwwvr/tto/patentscorner/pcnov_dec95.html (June 1, 2007)
World Intellectual Property Organization http://www.wipo.int/portal/index.html.en
Privacy.org http://www.privacy.org/
Federal Trade Commission “Privacy Initiatives” http://www.ftc.gov/privacy/ (June 1, 2007)