Interview: Bruce Lehman

At at the time of this interview, Bruce Lehman was the Assistant Secretary of Commerce, and Commissioner of Patents and Trademarks.

Copyright © 1994 Simon Higgs. All rights reserved.

Simon Higgs: With regard to domain registrations, since every site on the Internet is identified by its own name, are these domain names regarded as being a trademark?

Bruce Lehman: You know, trademarks are nothing more than official recognition of something that already exists. It's the consumer's perception that something is in fact a trade name, and so to the extent that names of people on the Internet acquire what we call secondary meaning, that is, that they come to be understood by the consuming public as the source of a particular good or service, then those words are trademarked. Now, if they do not, cannot be recognized as the source of a particular good or service, then they're not trade marked. For example, my name is not a trademark. On the other hand, if I go into business selling information through the Internet, and use my name, my name might become a trademark.

Simon Higgs: Okay, because earlier in the year, there was an Internet site which was called MTV.COM, and that was being run by Adam Curry (one of MTV's VJ's) apparently from his house. He'd registered the domain name with Internic in his own name with the permission of MTV. What happened was, he decided to go into business to become an Internet vendor, so to speak. He left MTV where he had been hosting the Top 20 Countdown. Once he left MTV's employ, they then turned around and said, well, MTV is our trademark, and even though he'd registered [the domain name], they're still saying, no, that's our name. Can you comment on that?

Bruce Lehman: Well, to the extent this matter would be in litigation, I don't want to try to comment on litigation, but I can tell you a little bit about the principles of trademark law that govern this, and they're really quite simple. The trademark law, unlike the patent law and the copyright law, really exists to serve the consumer, not to serve the interests of the trademark owner. The primary operating principle of it is that the consumer is not supposed to be confused by a plethora of different products all bearing what appear to be similar names, so that when the consumer thinks of MTV, he knows that he's getting something that comes from the source he identifies traditionally as being MTV. And so those are really the principles that would be applied here, why trademark examiner and trademark registration are ultimately by accord. So if in fact the letters MTV have acquired in the minds of consumers in a given field the reputation that they represent products that only come from that one company, then I would say that MTV has, probably, a pretty strong trademark, and that someone else just can't take it away from them very easily. Those are really the principles that are involved here. Obviously, like in everything else in the law, sometimes there are close calls, some confusion, but we've had for 200 years now a legal system to be able to work this out, and I'm sure that will happen in this case.

Simon Higgs: What about with Software Advertising? There was a patent that was granted to them, basically saying that anybody who places any advertising materials in software has to basically either pay them a royalty and is subject to a patent. Do you know where the status of that appeal is?

Bruce Lehman: Well, we in the Patent and Trademark Office have about 190,000 applications for patents every year. We issue just about 100,000 patents. Every once in a while there are some close calls, I suppose, or even some mistakes in the issuance of those patents, and that's why we have a procedure known as re-examination -- where we think maybe we made a mistake we can take a second look. And that's what was done with regard to this so-called software advertising patent, just as we did with the Compton's New Media patent. Now, the primary criteria for getting a patent is to show that your invention that you've come up with, whatever it may be, is useful, novel and non-obvious. Now, we all know what useful means. Novel means that it's never existed anywhere in the world before, and non-obvious means that it's not obvious to anyone ordinarily skilled in the particular technology that is involved. In order to make a patent determination, a patent examiner has to look at what we call the prior art, that is, all the pre-existing technology, the pre-existing products that are out there, to find out whether this new, presumed invention meets that test. That's a big job, in fact, partly because the amount of technology that a patent examiner has looked at has increased by about 30% in just the last decade from what it was in the whole history of the world before that. Sometimes it's hard to get all that information, and that's particularly true in the emerging area of software technology, where we didn't even issue patents prior to 1981, and so we don't have a very good database of the pre-existing technology in the Patent and Trademark Office. But every once in a while we can end up making a mistake, and in this area some people have told us that we have made a mistake, and so we have undertaken to re-examine a number of those patents, including the one that you just referred to, and hopefully after that re-examination we'll be able to make that determination, and decide whether it was a valid patent, or whether it wasn't.

Simon Higgs: So you're treating software as different. I mean, you can't patent, necessarily, a mathematical algorithm unless you can fix it in a tangible form. Is that true?

Bruce Lehman: Well, the ideas and mathematical principles, naturally occurring phenomena of nature and so on, are not patentable. However, if the discovery of such a phenomenon is in connection with a particular machine or device, in order to produce some useful product, then you do get into the area where you can eventually get a patent. And that's the situation with all software. It has as its base, obviously, certain mathematical algorithms. I like to think of it - a little bit like, you can't patent the alphabet, but on the other hand, if you can use words and numbers in connection with a machine such as a computer to produce some useful product, then you may be in the realm of invention, and those are the kinds of inventions that we have patented at the Patent and Trademark Office, and the Supreme Court has told us that we can and should patent them.

Simon Higgs: With the distribution of music, you remember the decision with 2 Live Crew earlier in this year, which basically expanded upon what seems to be the fair use of songs within digital media. Can you comment on that?

Bruce Lehman: Well, first of all, we have to distinguish here, of course, between patents and copyrights. A moment ago we were talking about the patentability of software. Copyright law provides a little different kind of protection. A patent really protects an invention, literally the idea of the invention. The copyright doesn't do that at all. Copyright simply gives you the exclusive right to control the use of the particular expression in a tangible medium of your idea. Now, that tangible medium could be in the form of a writing, could be in the form of a videotape, form of a computer program, in the form of some other kind of digitized work that might move through the Internet. And so that's what's protected by copyright. Now, with regard to issues such as sampling, for example, where the person - where someone takes a digital work that has been fixed, an expression, a copyrighted work that has been fixed, and they use that to create something else, they have created what we call in the copyright world a derivative work. They have taken somebody else's work and they've built on it to create something new. Now, they can have a copyright in that new work, that derivative work, but they might not necessarily be able to exercise or use that copyright unless they have the permission of the underlying author's work. That's basically the same principle that we use when you make a film based on a novel. The movie company has a copyright on its film, but also the novelist who may have created the underlying story has a derivative right in that movie, and the movie company has to get permission to exercise that derivative right. They have to pay the novelist. And the same thing is true in sampling or other kinds of digital techniques that will be used in this new technology in the sound area.

Simon Higgs: In the new intellectual property draft here [the final report is now available], what specific changes are you seeing as being absolutely necessary to copyright law in order to be able to protect the individual's right, the individual copyright holder?

Bruce Lehman: Well, in the area that we were just discussion, that is, taking somebody else's digitized work and modifying it in some way or other, I don't think that we need to change the law at all, and we have 140-some page report here, and all but about 15 pages just really explain how the existing law already covers the activities of the modern Information Infrastructure, and this is a very good example, I think, that where you take digital work and you mix it up, change it to create a derivative work, that's really no different than taking written words and mixing them up to create an additional or a new work. The area that you focused on, however, where there are some serious potholes in the Information Superhighway, if you will, really have more to do with what happens when you distribute the digital product through this electronic pipeline, and when that happens, you don't have the benefit that you've traditionally had when you have a physical copy of something, whether it be a can of 35 millimeter film or a videocassette, or the printed page. And so we've had to recognize, and we're proposing that the law be changed to recognize, that distributing a copy of a work through the Internet is the same thing as giving somebody a physical copy of a printed page.

Simon Higgs: So this is going to be basically a new definition of what the fixed form is and the tangible media that it can exist in.

Bruce Lehman: That's correct. Really, it is. It really boils down to that. And there are ancillary questions there, such as, you know, when does a work get published? You know, it's pretty - historically, we think of publishing as being when you print something up in a magazine or a book, and send out to distributors thousands of copies. Well of course, nowadays, I might be sitting in my house and I might in effect electronically publish a work, putting it out on the Internet and making it available to tens of thousands or even millions of users and I won't have gone through a particular publishing house. I won't have had it printed up at all, but that still is publishing. And we need to recognize that in the new law. And then that brings into consideration other additional issues in the copyright law, including what we call the first sale doctrine. And that is that historically when I get a physical copy of a work I'm kind of permitted to do whatever I want with it. I'm permitted to tear it up, or if I want to give it to you or lend it or rent it out I'm able to do that. From time to time over the years Congress has restricted that fair use right. Where the unfettered use of the first sale doctrine would, would somehow or other restrict the economic rights of the copyright owner, and that would be, for example, in the rental of computer programs. If I could rent computer programs, then somebody could obviously take them home and download them and I wouldn't be able to sell my computer programs.

Simon Higgs: So a lot of the issue has been in the past many bulletin boards have distributed music, either in digital form as a digital audio work or as basically a musical word processing document called a minifile. There was a lawsuit filed against CompuServe for copyright infringement in December, 1993 that basically - I mean, their whole suit was done on behalf of 140 publishers, a class action suit, and was seeking damages of about a billion dollars. That's one of the issues I know the publishers are probably going to want to address is, how can this type of distribution be protected? What is the method of royalties that can be brought back to the publishers or the copyright holders through the distribution methods on the Internet?

Bruce Lehman: Well, you know that one of the rights that a copyright holder has is the right to publicly perform or display their work, and then they also have the right to distribute the work in copies. Now, this is something that becomes a little unclear, a little fuzzy when you're dealing with the electronic environment and when you're dealing with the Internet. One thing that is very, very clear is that nothing in the copyright law ever has or was intended to just permit people to take somebody else's work without their permission. The Electronic Superhighway makes that very easy to do, sometimes, and so we forget sometimes that other people have certain rights. To the extent that a computer distribution service takes somebody's work or takes one of their existing copyrights and doesn't get their permission, then I think we've got a problem. Now, we'll see how that plays out in the cast that you just mentioned. There are arguments on both sides there, but the courts will work their way through that. One of the issues that our report really deals with, and that is, what is the boundary between a public performance of a work and an electronic distribution of the work? You know that we have in the existing world of print works and of television and radio and sound recordings, we have the music publishing right on one hand, and then we have the public performance right on the other hand, and the public performance right is taken care of, basically, by the performing rights societies such as ASCAP and BMI and music publishers, so the - what we call the publishing right. Generally speaking, publishing rights are intended the right to actually fix the music. For example, if I want to - what we call the mechanical right, if I want to actually record somebody's published music on a record, I have to get their permission. And also the publishing right can involve the right to distribute copies of a given work, such as sheet music. Now, when I play my sound recording on the radio, for example, which includes the mechanical right that's already been taken care of, of course, then another element of the copyright law comes into play, and that is the right to receive royalties from the radio station for the public performance of the work. When you're talking about distributing or sending a performance of a musical work through the Internet, then it gets to be a little bit cloudy. Is that the distribution of copies of the work, or is that a public performance like sending something out on the radio? In our report, we have tentatively concluded that the way you work through that issue is to look at the primary purpose or effect of the activity, and if the primary purpose or effect was intended to be a distribution to a wide audience, like a radio audience, then you're in the realm of public performance, and if you really are intending to distribute individual copies of a work, such as audio on demand, then you're in the publishing area, and you would be in the area of the publisher's copyright.

Simon Higgs: So the definition of that would be that if it was television programming which you have no control over, that's dealt with differently from you saying well, I want to hear this record or watch this television program.

Bruce Lehman: That's correct.

Simon Higgs: And I'm going to do it digitally.

Bruce Lehman: That's correct. Those are the basically the guiding principles on where the receiver doesn't have any control of what they receive other than maybe, you know, flipping through a few television channels. You're really in the area of public performance. Where you can specifically dial up a given work on the Internet or on the Information Highway, you've really received a copy of the work, and you have - it has been distributed to you, and that distribution right, then, that is the distribution right as opposed to the public performance right, has come into play.

Simon Higgs: So it's basically a sale of that work as far as royalties are concerned?

Bruce Lehman: That's correct, yes.

Simon Higgs: So that means that people will be allowed to record at home, and they will be allowed to have their personal private use of those recordings to do whatever they want with.

Bruce Lehman: For the most part, yes. We do have some restrictions on what we call the first sale doctrine that we are proposing. That's because a digital work is very difficult to control, so that one thing that is not going to be permitted, for example, is your right to record a work and then distribute it to five or ten of your friends. That would be violating the copyright owner's right.

Simon Higgs: But would I be able to say go make me five copies for somebody to distribute them?

Bruce Lehman: Yes, you could. Once - yes. Nothing - now, this is very important to understand. Nothing here prevents the use of licensing to take care of any of these problems. We expect that licensing will take care of these problems, and that is that the marketplace will respond by providing ways to let people do whatever they want with works. You know, right now every month you get a telephone bill, and most of us now have long-distance telephone charges. Sometimes we even have charges from use of our cellular phone to distant countries. Sometimes we even have charges even from foreign telephone companies on the bill. They all come in the form of one telephone bill that shows how many minutes we talked. The same thing can be done with the use of electronic products on the Internet. You can be billed for these uses, and these individual uses can be sufficiently inexpensive that they're not much different than a long-distance telephone call of one or two dollars on your telephone bill.

Simon Higgs: Who do you see as being the service provider of the future? What type of company are they going to be? Are they going to be, you know - is it going to be a telephone carrier? Is it going to be a cable company? Is it going to be a new entity? When you're legislating the law and you're looking at how you want things to work on the Information Superhighway, what do you envision happening?

Bruce Lehman: Well, I don't have a crystal ball. I can guess.

Simon Higgs: Just give it your best shot.

Bruce Lehman: We're already seeing the evolution of these industries. You mentioned one company like CompuServe or various bulletin board services could perform this function. In fact, cable companies, to the extent that they get into the business, could perform this function. One of the things that continued deregulation of telephone companies is all about is that we may let telephone companies get into this business, but you've even got credit card companies like Master Card and Visa and American Express, since a lot of this involves billing, that might want to get into the business. I suspect you're going to see a number of different entities getting into various aspects of the business, and eventually the market will shake out which ones are the ones which are the methods of distribution and payment that the consumer most prefers. And I'm sure that there will end up being a number of them, because you will continue to have competition. You won't have one or two companies dominating the business.

Copyright © 1994 Simon Higgs. All rights reserved.