I. First Possession: Acquisition of Property by Creation & Capture

Question 1

What is Acquisition by Creation? And two theories behind it.

Answer 1

If you create something, that thing is most certainly yours to exploit; “the foundation of proprietary rights is the expenditure of labour and money” (Libling) / You own the fruits of your labor in consequence of having “a property in your own person” (John Locke).

Question 2

Two features of IP?

Answer 2

Information is nonrivalrous (does not interfere with use by others) and non-excludable (difficult to prevent others from using).

Question 3

INS v. AP?

Answer 3

Facts: Competitor news source taking news from bulletin. Holding: Cannot have copyright protection in the news; from a policy perspective we don’t want people to own the news. Cannot exclude the public. Quasi-property right regarding the right to sell news they’ve gathered, court wanted to protect property.

Established Quasi Property: made up to find outcome desires since cannot exclude public; only used in circumstances where there is a competitive relationship

Question 4

Cheney Brothers v. Doris Silk Corps?

Answer 4

DS copied prints and sold for cheaper, distinguished from INS by facts only and held may intimate at their pleasure. Hard to patent because designs only lasted one season. Basic rule is that you can imitate. Policy: promote competition and imitation such that exclusive rights do no help raise quality and lower prices

Question 5

“Hot News Doctrine’?

Answer 5

General principle today is that of Cheney Brothers (others are free to imitate or copy the original). Some courts have adopted the “HND,” based largely on INS, where newsgatherer may recover from a defendant when: (1) newsgathering process involves significant expenditures, (2) news/info is time sensitive; (3) D free rides on collected material; (4) freeriding directly competes with newsgatherer’s market; and (5) the freeriding is likely to diminish incentives to college news/info in a timely fashion.

Question 6

How have copyright laws changed?

Answer 6

Copyright

Initially 14 years + 14 more → now life + 70 years 

No longer allow translations and abridments 

DMCA prevents from unlocking a work

Question 7

How have patent laws changed?

Answer 7

Patents

Greater enforcement/ability to sue + longer duration of 20 years 

Expanded subject matter to biotech, business methods etc

Question 8

How have trademark laws changed?

Answer 8

Trademark

Purpose: prevent customer confusion/encourage product quality 

Expand to dilution and “trade dress” (ex. Restaurant decoration) 

No need to show misuse, can show being overused

Question 9

How have rights of publicity changed?

Answer 9

Rights of Publicity

Prevents the use of a person’s name or likeness for commercial benefit 

Used to just be name, image, voice → now anything related to them 

Used to end at death → now ends extends to 50/70/100 years

Question 10

What are the 5 justifications for restricting IP?

Answer 10

Moral rights → protect authors rights to integrity, attribution and disclosure

Natural rights → individuals are entitled to the fruits of their labor  

Personhood → need property rights to control resources in external environment 

Right to exclude → purpose increase innovation 

Utilitarian Justification → Produce incentive to innovate * Not applicable in property because tangible

Question 11

What are the dangers of creating exclusionary rights?

Answer 11

ngers of Exclusionary Rights

Monopoly Loss: when they are the only ones selling the product they can raise the price 

Ex. Big Pharma 

Innovation Bottlenecks 

Intergenerational Bottleneck→ Patent on one part blocks innovation on all parts 

Intergenerational Bottleneck→ Blocks subsequent/future innovation  

Bottlenecks inevitable because of process of innovation and patent system

Question 12

What is the tragedy of the commons?

Answer 12

Tragedy of the commons: resources held in common will be overused

Private property internalized costs by excluding- allows to preserve for future use (predictability and protection!) 

Not needed in when 

Rights cannot be applied to the resource ex. water/air 

Exclusion cannot prevent tragedy ex. Natural disaster 

Can be solved with norms/rules ex. Small communities

Question 13

What is the danger of the anti-commons?

Answer 13

Danger of creating the Anti-commons: too many people right to exclude

Can avoid with limits like zoning laws aka not absolute right to exclude 

Risk making rich richer

Question 14

3 major property rights & justifications?

Answer 14

Right to Exclude (gives value); Right to Transfer (Benefit & Productivity); Right to Use (Benefit)

Question 15

What are 6 theories underlying property?

Answer 15

Labor Theory→ reward labor

Personhood→ how express self with respect to external environment 

Utilitarianism→ best interest of society 

First Occupancy/Possession 

Liberty/Civil Republicanism→ promoted by property because interest in land promotes interest in society as a whole 

Distributive Justice/Fairness→ system of property keeps fair

Question 16

How is possession of wild animals established? 3 cases

Answer 16

Post (capture, deprive of natural liberty, as first possessor you are the owner). Whaling case (custom – can be useful in figuring out the most efficient way to determine an issue). Keeble (unfair competition; not something we want to promote).

Question 17

Pierson v. Post? (Dissent)

Answer 17

respass on the case (less direct than trespass): Post was fox hunting with dogs on common land when Pierson stepped in with knowledge that Post had been hunting the fox and killed it himself. Holding: Property in wild animals is acquired by occupancy, pursuit alone is not enough: actually have to capture it or deprive it of its natural liberty through something like a net or a trap. Majority looked to ancient philosophers to decide.

Dissent (Livingston): Property of wild animals is acquired when the pursuer is within reach or has a reasonable change of taking physical possession. An arbitration of sportsmen should have decided this case, not opinions of ancient philosophers.

Question 18

Ghen v. Rich?

Answer 18

COA: libel- admiralty suit to recover the value of a fin-back whale: whale was found stranded on the beach and instead of sending word to the town, as custom, he took it to an auction and sold it to respondent (they didn’t know who killed it but did know someone in the business killed it). Narrow holding to Whaling: A person establishes a property right over whales when he takes possession of the carcass and takes practical steps to secure it, in accordance with local custom. Policy arguments: Industry would suffer if whalers could loose the fruits of their efforts; custom should be upheld.

Question 19

How can you internalize externalities in property law? (3)

Answer 19

Externalities exist when a person makes decisions about how to use a resource without taking account of the effects of that decision; heart of economic theory of property rights. This theory says purpose of private property rights to maximize the value of scarce resources (internalizing externalities) by (1) concentrate the costs and benefits of the use on owners, giving them incentives to use resources more efficiently; and (2) reduce the cost of negotiating with others over remaining externalities, reduce transaction costs. High transaction costs problems: (1) free-riders and (2) holdouts.

Question 20

What is constructive ownership?

Answer 20

Landowner has constructive ownership of whatever is on, under or attached to their property as long as you have the intent to maintain and the ability to control

Question 21

Keeble v. Hickeringhill (1707)

Answer 21

P had a decoy pond to trap ducks, D had his own pond but shot his gun to scare the ducks away from P’s pond

• D tries to hinder someone’s trade and livelihood (could have built a better duck pond and that would have been competition on the merits)
• P wins: interference with business interest: laws against unfair competition/malicious interference
• policy: consistent with Pierson v. Post: help kill as many ducks as possible
• constructive possession: not actual possession- continuation of possession as long as you have the intent and maintain ability to control (when duckies are on your land)
• policy purpose: to discourage trespass

Question 22

Spite/Abuse of Right Doctrine

Answer 22

Abuse of property right with subject intent to harm

Mixed intent→ some jurisdictions require it to be the sole purpose, others require predominant purpose

Question 23

Coase Theory

Answer 23

Absent transaction costs, parties can easily negotiate, people will negotiate (pay) for what they really want

Question 24

Domesticated Animals

Answer 24

owner has rights to it: want to encourage domestication of animals and reward the owner but need to be sure to warn others that it is domesticated

• if it’s not typical of the area: obviously domesticated
• if it is typical of the area: need to do more to warn others

Question 25

“Rule of Capture” / fugitive resources

Answer 25

Common law doctrine initially used in hunting to determine ownership; later applied to oil and natural glass. Means a landowner has a property right in oil and gas produced from wells on the owner’s land, whether or not it migrated from other lands.

Created an incentive to drill quickly; drove up production costs, reduced oil and gas market prices, and decimated the environment. 

States intervened to create “spacing laws” and “pooling laws,” which allowed owners to combine interests to form drilling units that meet spacing requirements, sometimes forced pooling law.

Question 26

Hammons v. Central Kentucky Natural Gas:

Answer 26

Held that reinjected gas, when escaping a landowner’s property, was no longer her property and thus the previous owner was not responsible for damages. The Kentucky Supreme Court overruled; ownership of reinjected gas remains intact.

Question 27

Surface Water (2 rules)

Answer 27

• prior appropriation doctrine: 1st to capture and put to beneficial use is the owner
• riparian rights: landowner along the source owns it

Question 28

Groundwater (2 rules)

Answer 28

• English rule: draw whatever want (similar to capture rule)
• American rule: can’t waste it (must be reasonable: encourage development)

Question 29

Popov v. Hayashi (Gray’s Rule v. Contextual Rule)

Answer 29

Baseball case.
Gray’s Rule: A ball is caught if the person has achieved complete control of the ball at the point in time that the momentum of the ball and the momentum of the fan while attempting to catch the ball ceases. A baseball, which is dislodged by incidental contact with an inanimate object or another person, before momentum has ceased, is not possessed.” Adopted by the court.

Contextual Rule: can wrap your arms around the ball (consider custom where caught = owner) Possession occurs when an individual intends to take control of a ball and manifests that intent by stopping the forward momentum of the ball whether or not complete control is achieved. (