Copyrights and Trademarks in Cyberspace: A Legal and Economic Analysis
Chicago-Kent Journal of Intellectual Property
Copyrights and Trademarks in Cyberspace: A Legal and Economic Analysis
Georgios I. Zekos
Follow this and additional works at: https://scholarship.kentlaw.iit.edu/ckjip Part of the Intellectual Property Law Commons Recommended Citation Georgios I. Zekos, Copyrights and Trademarks in Cyberspace: A Legal and Economic Analysis, 15 Chi. -Kent J. Intell. Prop. 313 (2016). Available at: https://scholarship.kentlaw.iit.edu/ckjip/vol15/iss1/10
GEORGIOS I. ZEKOS*
I. INTRODUCTION
Intellectual property is at the center of the “new economy.” New
economy products are characterized by declining average costs over a range
of outputs, high rates of innovation, and network effects.1 Classically,
intellectual property is one element among many in a production process
adding to the value of a firm via licensing for competent exploitation of IP
rights, cost reductions, R&D investment, and new products.2 Cumulative
innovation proceeds as innovators build on each other’s discoveries.
A vital target of IP law is to reward innovation and creation, by granting
exclusive rights to use a new invention, information or a cultural good. The
legal system induces the economic system, and legal norms must be assessed
in ways that lead to the best outcome.3 The return from intellectual property
rights is directly correlated to the duration and scope of those rights.
Copyright offers authors a legal instrument that reimburses them for
their creative works. Copyrights are not absolute, and a copyright holder
never has complete control over all probable uses of his work. A copyright
is the right given to creators for their literary or artistic works, encompassing
mediums such as books and e-books, plays, newspapers, computer programs,
databases, films, musical compositions, paintings, photographs, sculpture,
architecture, advertisements and maps. Copyright does not embrace ideas,
processes or procedures, mathematical concepts or methods of operation.
Similarly, IP rights make digital goods legally exclusive as well. The
protection obtainable by copyright is only for the expression of the work.
* Advocate and Economist. BSc (Econ) Aristotle University, JD Democritus University, LLM, PhD
(Law) University of Hull, PhD (Econ) University of Peloponnese. The author may be contacted by email
at or .
1. GEORGIOS I. ZEKOS, MNE’S IN 21ST CENTURY (2016); GEORGIOS. I. ZEKOS, LAW AND
ECONOMICS OF IPRS (2016); Richard A. Posner, Antitrust in the New Economy, 68 ANTITRUST L.J. 925,
926 (2001).
2. Julie E. Cohen, Copyright as Property in the Post-Industrial Economy: A Research Agenda,
2011 WIS. L. REV. 141, 1
43 (2011
) (“[T]he purpose of copyright is to enable the provision of capital
and organization so that creative work may be exploited.”)
3. R. H. Coase, The Institutional Structure of Production, 82 AM. ECON. REV. 713, 715 (1992).
314
The goal of copyright law is to preclude the unlawful use or piracy of any
literary or artistic work by a third party. Works that are not protected by
copyright law therefore belong to the public.
Trademark law allows consumers, in the marketplace, to swiftly
identify a product they liked or disliked in the past. Therefore, trademarks
allow companies and consumers to distinguish among the different
competing manufacturers of a given product. No one is entitled to sell or
deliver commodities under the appearance that the commodities derive from
someone else. The importance of consumer protection cannot be
overemphasized, and the average consumer standard should remain the central
point of the inquiry, even for domain name litigation. Trademark protection
promotes three main policies: (1) protection of the trademark holder’s
goodwill, (2) protection of the consumer, and (3) economic efficiency.
Goodwill should be protected to the extent needed to prevent the unjust
enrichment of a competitor. When there is no confusion at the time the user
clicks on the advertisement or web-link, it does not lead to unjust enrichment.
Fair use is a defense to trademark infringement, and one example of fair use
is comparative advertising. Trademark protection, while constituting a vital
instrument to make certain markets transparent, must be reconciled with
other principal values including free expression, by enhancing consumer
information and consumer preference, and free competition, averting
needless barriers of entry in the market.4
The TRIPS Agreement includes a set of minimum principles for IP
rights protection and calls for all member countries to use the
most-favorednation principle in IP protection. Nevertheless, IP rights protection is
currently not close to harmonization across nations, and the TRIPS
Agreement failed to harmonize standards of protection among intellectual
property systems. The TRIPS Agreement does, however, include Article 10,5
which describes computer programs and compilations of data, as well as
Article 11,6 which tackles the rights of authors and their s (...truncated)