8 pluralism, principles and proportionality in intellectual property

7/23/2019 8 Pluralism, Principles and Proportionality in Intellectual Property

http://slidepdf.com/reader/full/8-pluralism-principles-and-proportionality-in-intellectual-property 1/20

Oxford Journal of Legal Studies, Vol. 34, No. 1 (2014), pp. 181–200doi:10.1093/ojls/gqt029Published Advance Access October 21, 2013

Pluralism, Principles and Proportionalityin Intellectual Property†

Justine Pila*

Abstract —This review article offers a European perspective on the pluralistic,

principles-based model of intellectual property (IP) advanced by Robert Merges inhis book Justifying Intellectual Property. After introducing Merges’s model and theoryof IP with reference to IP theories generally, other pluralistic legal models, andpatterns of judicial reasoning in the patent and copyright fields, the article arguesthat European jurisprudence offers broad support for Merges’s operational modelof IP, while also challenging certain aspects of his wider analysis. They include his‘one size fits all’ foundational theory of IP, his account of key IP rules andpractices, and his choice and conception of IP’s midlevel principles. Through thiscritique the article draws attention to the utilitarian bias of Merges’s model; a biaswhich undermines its pluralistic claims, in part by undermining Merges’s ownfoundational theory of IP. The result is to underline the limits of a regime

unconcerned with its own normative basis, and the need for more rather than lessdiscussion of IP theory, including more work of the type that Merges’s bookundertakes.

Keywords: Intellectual property, justifications, pluralism, EU law, Europe,principles, copyright, patents

1. Introduction

Over its 600-year history, intellectual property (IP) has been dogged bypersistent disagreement over its normative foundations, and whether they

justify the various IP regimes then extant.1 Particularly heated have been the

debates over the proprietary nature of IP rights, due to the perceived

implications of a right’s formal characterization as ‘property’ for its duration,

† A review of RP Merges, Justifying Intellectual Property (Harvard University Press 2011) ( JIP ).* St Catherine’s College, Faculty of Law, and the Institute of European and Comparative Law at the

University of Oxford. Email: [email protected]. I am grateful to Julie Dickson for her valuable editorialcomments on this article.

1 For example, 400 years after the first patent legislation was introduced in Venice, Switzerland remained

steadfast in its refusal to establish a patent system on the basis of the ‘pernicious and indefensible’ principle of patent protection. F Machlup, An Economic Review of the Patent System: Study of the Subcommittee on Patents,

Trademarks, and Copyrights of the Committee on the Judiciary (US Govt Printing Office 1958) 4.

The Author 2013. Published by Oxford University Press. All rights reserved. For permissions,please e-mail: [email protected]

a t D a l h o u s i e Uni v e r s i t y onA

pr i l 1 4 ,2 0 1 5

h t t p : / / o j l s . oxf or d j o ur n a l s

. or g /

D o wnl o a

d e d f r om

http://ojls.oxfordjournals.org/




































enforceability and legal status, and over the capacity of IP systems to

accommodate ‘new’ technologies, such as film, the internet and biotechnology.

A common starting point for these debates has been the intangible nature of

the various subject matter that IP rights protect. In addition to making

conventional arguments for the existence of real and personal property

inapplicable, the non-rivalrous and non-depletable nature of works, inventions

and other such subject matter support their perception as ‘public goods’

inappropriate for individual ownership. In so doing these features of IP subject

matter contribute to another widely held belief within academic circles: that IP

exists for essentially historical and pragmatic reasons, and that while our

investment in it is sufficient to make its abolition infeasible, it has no positive

justification as such.2

It is against this background that Justifying Intellectual Property ( JIP ) has been

written.3 In this book, Robert Merges responds to his disillusionment regardingthe empirical claims of utilitarian arguments for intellectual property by

searching for an alternative model capable of justifying the existence of its

various regimes. The result is a liberal, pluralistic account of IP, built on

a commitment to individual ownership as a primary right, respect for third-party

interests that conflict with this right, and, from the philosophy of John Rawls, an

acceptance of redistributive policies intended to remedy the structural hardships

caused by individual property rights.4

Put differently, it is a model of IP as a means of protecting ‘personalbut unselfish’5 property rights, justified not by their alleged benefit to the

community, but by arguments from morality and natural law, including

particularly Kantian theories of freedom and autonomy.

That the justification for IP remains in contention six centuries after the first

IP legislation suggests a certain disconnect between its roots and day-to-day

operation. And indeed, central to Merges’s account is his claim that

foundational theories of IP have limited practical significance; that there are

many plausible arguments for IP, and that our choice between them is of little

operational importance.6

The reason is his belief that the application anddevelopment of IP systems depend not on which theory we support, but on

which ‘midlevel principles’ we prioritize.7 Hence the paradox of his book,

which offers both a justification for IP, and a justification for not worrying too

much about trying to justify IP, and an argument for paying greater attention

2 In the oft-cited words of Fritz Machlup (ibid 80), ‘[i]f national patent laws did not exist, it would be difficultto make a conclusive case for introducing them; but the fact that they do exist shifts the burden of proof and it isequally difficult to make a really conclusive case for abolishing them’. See JIP 6.

3 JIP ix, 6, 12.

4 ibid 13.

5 ibid.6 See ibid 9–11.7 See ibid 9.

182 Oxford Journal of Legal Studies VOL. 34


pr i l 1 4 ,2 0 1 5


. or g /

D o wnl o a

d e d f r om





































instead to the four principles which he identifies as having the greatest

operational significance: dignity, efficiency, non-removal from the public

domain and, above all, proportionality.

In this article I respond to Merges’s expansive and thought-provoking book

by offering a European perspective on his thesis. My suggestion is thatEuropean jurisprudence offers broad support for his pluralistic, principles-

based model of IP. On the other hand, it also challenges certain aspects of

Merges’s analysis, such as his ‘one size fits all’ foundational theory, his account

of key rules and practices, and his choice and conception of midlevel

principles. In so doing it draws attention to the utilitarian bias of his

operational model; a bias which undermines his model’s pluralistic claims, in

part by undermining his own deontological argument for IP. The result is an

approach that unintentionally underlines the limits of a regime unconcerned

with its own normative basis, and the need for more rather than less discussionof IP theory, including more work of the type that Merges undertakes.

This response is presented in three parts. The first introduces Merges’s

justification for IP and his pluralistic account of its day-to-day operation with

reference to IP theories generally, other pluralistic legal models, and patterns of

judicial reasoning in the patent and copyright fields. The second explores the

details of his operational model of IP with assistance from European copyright

and patent law, highlighting certain problems with his choice and conception of

IP principles and the rules and practices from which they derive. And the third

returns to the question running through Merges’s book of what it means totake certain values, such as autonomy and dignity, seriously in IP.

2. Theories and Principles of IP and Their Practical Significance

The idea that intellectual property systems exist for essentially historical and

pragmatic reasons alludes to the value of history in understanding the various

IP regimes that exist, including the general forms that they take.8 Broadly

speaking, and focusing on its two paradigm systems of patent and copyright

law, the historical origins of IP lie in two philosophical traditions aligned withthe civil and common law, respectively. While it has become common to

downplay the differences between these traditions with a view to emphasizing

the nuances of each and the similarities between the civil and common law

more generally, they account for important aspects of the development of

European and other IP regimes as well as the forms which those regimes take.9

8 On the historical origins of copyright and patents particularly see eg, and from a vast literature, A Birrell,Seven Lectures on the Law and History of Copyright in Books (Cassell 1899); M Rose, Authors and Owners: The

Invention of Copyright (Harvard University Press 1993); C Hesse, ‘The Rise of Intellectual Property, 700B.C.– A.D. 2000: An Idea in the Balance’ (2002) 131 Daedalus 26; Machlup (n 1).

9 See eg JIP 156 (describing the attribution of different IP traditions to a civil / common law divide as an ‘oldconvention’ which ‘has a tendency to be wildly overblown’, and then noting that the dignity principle is aparticular feature of European copyright). cf also JC Ginsburg, ‘A Tale of Two Copyrights: Literary Property in

SPRING 2014 Pluralism, Principles and Proportionality in Intellectual Property 183


pr i l 1 4 ,2 0 1 5


. or g /

D o wnl o a

d e d f r om





































The civil law tradition of IP is perhaps best captured by the statement of Le

Chapelier, when presenting the French Playwrights Decree in 1791, that ‘[t]he

most sacred, the most legitimate, the most unassailable, and, I may say, the

most personal of all properties, is the work which is the fruit of a writer’s

thoughts’.10 Implicit in this statement is that the law recognizes property rightsin the products of authorial (and other forms of intellectual) labour in the

belief that the nature or value of such labour or of the products themselves

merits such recognition, and/or that such recognition is necessary or desirable

either to enable authors to flourish as autonomous human beings, or to protect

their rights in respect of their personhood or intellectual labour.11 Each of

these arguments is a matter of considerable controversy, as is its focus on the

rights and interests of individual creators. They are also the departure point for

the second tradition of IP, epitomized by the United States’ (US) copyright

and patent clause, which empowers Congress ‘[t]o promote the Progress of Science and useful Arts, by securing for limited Times to Authors and

Inventors the exclusive Right to their respective Writings and Discoveries’.12

Implicit in this clause is that the justification for granting IP rights lies not in

moral or natural law arguments, but in a policy commitment to encouraging

the production and distribution of intellectual artefacts through the conferral of

property. Such conferral, it is said, benefits the public economically by

resolving the market failure which the intangibility of those artefacts creates, as

well as socially by supporting a robust public domain of expressive, informa-

tional and other intellectual (including technical) subject matter. For example,and speaking again of copyright and patents, they create a false scarcity with

respect to works and inventions by excluding others from their use, thereby

enabling the right holder to preserve the possibility of exploiting them

commercially in the hope of recovering the costs of their creation and

dissemination along with sufficient profit to undertake further such activities.

Thus, by granting IP rights in the medium term, the state secures the

unlimited availability of IP-protected subject matter in the long term, and this

for the good of society.

As with deontological arguments for IP, the premise of utilitarian theorieshas been widely critiqued. That authors and inventors have no deeper claim

than positive law to exclude others from the unauthorized use of their

Revolutionary France and America’ (1990) 64 Tulane L Rev 991 with JC Ginsburg, ‘European Copyright Code – Back to First Principles (with some additional detail)’ (2011) Auteurs et Medias <http://ssrn.com/abstract=1747148> accessed 13 August 2013.

10 G Davies, Copyright and The Public Interest (Max Planck Institute for Foreign and International Patent,Copyright and Competition Law 1994) 79 (quoting from Archives Parlementaires de 1787 a 1860, Receuil complet

des de bats le gislatifs et politiques des Chambres francaises (vol xxii, Paris 1887) 210.11 On IP rights as promoting human flourishing see JIP 38, 105. A further argument from harm and unjust

enrichment is that not recognizing such rights would cause harm to authors or enable third parties to enrichthemselves unjustifiably at an author’s expense. Merges also supports this argument as linked to Kant; see JIP 89.

12 The United States Constitution, art 1, s 8.



pr i l 1 4 ,2 0 1 5


. or g /

D o wnl o a

d e d f r om

http://ssrn.com/abstract=1747148








































intellectual creations seems counter-intuitive in an age in which they are held in

exulted status and rights-talk dominates many areas of private law.13 Equally

contentious are the empirical assumptions of utilitarianism, including: that

authors and inventors are motivated by economic considerations more than

communicative, reputational or truth-seeking ones; that property rights are

required and able to cure the market failure which exists in respect of IP

subject matter; and that market-based systems of incentivizing creation and

dissemination through the grant of exclusionary rights benefit the public more

than they harm it.14 And it is Merges’s doubt regarding those assumptions—

and his belief in particular that the data ‘support a fairly solid case in favor of

IP protection–but not a lock-solid, airtight case’15 —that leads him to effect a

philosophical shift from social utility to fundamental rights in JIP .16 That this

shift comes from such a prominent and well-regarded academic working within

the utilitarian and law-and-economics schools of US IP scholarship adds to theinterest of his book,17 in addition to explaining certain aspects of the approach

it advocates.18

Two ideas motivate Merges’s foundational theory. The first is that IP is

‘really property’,19 and the second is that, as a result of this, the modern

literature on property has relevance for it, along with the works of Locke, Kant

and Rawls on which that literature builds.20 Starting with Kant, Merges

describes ‘individual autonomy and freedom’ as the basic foundations of IP,21

and as requiring legal rules of (intellectual) property that ‘maximize the

freedom of all members of civil society’.22 The result is a view of IP systems as‘respect[ing] individual property claims at a deep level and . . . simultaneously

car[ing] about the practical impact of [those] claims on the lives and fortunes

of others’.23 Put differently, and in the language favoured by contemporary IP

scholarship, it is a view of IP as ‘balancing’ individuals’ property interests on

the one hand with third party and societal interests on the other.24 Hence the

question of how that balance is appropriately effected, including what it

requires. On these issues, Merges tells us, Kant’s work is silent, prompting him

13

On talk of IP rights as rights see JIP 3.14 For critical perspectives on these assumptions see eg, and also from a vast literature, L Lacey, ‘Of Breadand Roses and Copyright’ [1989] Duke LJ 1532; S Breyer, ‘The Uneasy Case for Copyright: A Study of Copyright in Books, Photocopies, and Computer Programs’ (1970) 84 Harvard L Rev 281; E Hettinger,‘Justifying Intellectual Property’ (1989) 18 P&PA 31.

15 JIP 3 (emphasis in original).

16 See ibid 6, 16–17.17 See ibid 16.18 See eg ibid 10–11 (‘I do not want you to think that [my foundational shift from utilitarian to deontological

theory] undermines my prior work or my commitment to analyzing detailed doctrines and rules, and theinstitutions that surround them, from the perspective of efficiency.’)

19 See ibid 4–5 (emphasis in original).20 ibid 12–13.21 ibid 15.

22 ibid 19.23 ibid 18–19.24 See ibid 302ff.



pr i l 1 4 ,2 0 1 5


. or g /

D o wnl o a

d e d f r om





































to look to Locke’s theory of property, including Locke’s provisos and other

limitations on appropriation claims.25 This leads him to a ‘conception of

individual property coupled with state-backed limitations and taxation’, which

also represents, he says, a basic liberty in a fair society.26 Moving thus from

Locke to Rawls, Merges argues that the institutional protection of IP rights isjustified by the legitimate desert claim which creators have on the basis of their

dedicated development and application of talent, and by the recognized (albeit

lesser) interest of society in that same talent and effort.27 Hence Merges’s view

of IP regimes as having a solid justificatory basis in the deontological theories

not only of Kant and Locke, but also of Rawls; a view which he describes as

‘hardly new’ but ‘often overlooked’ by IP theorists, and as having important

implications for the way we approach those regimes.28

Most choose to channel all their discussion of the proper balance between individualand society into the arena of IP law itself, as though each doctrine and each

controversy must be engineered so as to get the balance right. The more systemic

view supplied by Rawls’s way of thinking can get us out of the unproductive and often

divisive trap of thinking that each individual rule of IP must balance out perfectly.

Rawls’s approach frees us from this excessively internalist perspective and ought to be

embraced for that reason alone.29

As can be seen from this paragraph, a central aspect of Merges’s

foundational theory is his view that IP systems can and ought to be trusted

as effecting an appropriate balance overall between competing individual and

societal interests, and that to subject ‘each doctrine’ and the resolution of ‘each

controversy’ to detailed scrutiny with a view to ensuring that they individually

effect such a balance would reflect a lack of perspective by ignoring the wood

of IP for its trees. This argument has particular importance given the number

of open-textured concepts in IP. For example, copyright in the UK subsists in

original literary, dramatic, musical and artistic works, and is infringed by the

unauthorized copying or other reserved use of a substantial part of such works.

It is also subject to various defences, including where the unauthorized use of

the work is a ‘fair dealing’ with it for the purpose of criticism, review, reporting

current events, non-commercial research or private study.30 In Merges’s view,such open-texturedness in the core concepts of IP is essential to enabling the

courts to fine-tune the system in order to achieve ‘the proper balance between

individual and society’ referred to above, and their interpretation and

application of those concepts ought (therefore) not to be second guessed.31

25 See ibid 19.26 See ibid 20, 103ff, 117.27 ibid 124, 126.28 ibid 20.29 ibid.

30 See Copyright, Designs and Patents Act 1988, ss 29, 30.31 According to Merges, one of the virtues of proportionality is that it enables this balance to be achieved

through the application of rules that ‘disguise’ the balancing exercise. See JIP 190 (discussing proportionality).



pr i l 1 4 ,2 0 1 5


. or g /

D o wnl o a

d e d f r om





































While attributed to the systemic perspective which his argument for IP entails,

this view also reinforces his account of its day-to-day operation by relieving

specific IP rules and practices of the burden of protecting third party rights and

interests in individual cases.32

JIP is not the first work to offer a pluralistic account of IP built aroundmidlevel principles. For example, in his 2003 essay entitled ‘A Pluralistic

Account of Intellectual Property’,33 David Resnik analyzed six approaches to

IP based on Lockean property theory, US-style utilitarianism, Hegel’s theories

of freedom, self-expression and property, privacy and egalitarianism, including

Rawls’s pluralistic conception of justice. The conclusion he reached was that

none of these approaches accounts adequately for the existence of IP, with each

instead emphasizing a different value or goal which IP supports, including

autonomy (or freedom), privacy, utility and justice. He argued that an

alternative understanding of IP is therefore required, and expressed hispreference in that regard for a pluralistic one, explained with reference to the

inadequacy of the other approaches in isolation, the diversity among the

different IP regimes, and the pluralistic nature of modern democratic societies,

all of which he described as militating against a ‘one size fits all approach’ to IP

(or any other form of property).

Resnik’s description of the practical implications of his pluralistic model

elucidates Merges’s model by highlighting some important similarities and

differences between the two. According to Resnik, when resolving IP disputes a

court ought to decide which of the values having primacy in IP are at stake, andthen weigh and balance those values to decide which ought to have priority in

the particular case. While all IP values are a priori equal in Resnik’s account, the

extent of their engagement in a case depends in part on the IP right involved and

its social and legal function. For example, because (US) patent law exists to

‘promote the progress of science and the useful arts’,34 utility ought to have a

higher priority in patent disputes than privacy and autonomy. The reason is

social pluralism, which Resnik views as requiring a commitment to a certain legal

pluralism as well, not only in the sense of tolerating different individual beliefs as

to the nature of or reason for law, but also in the sense of allowing that the

different aspects of a legal institution such as IP be governed by different ‘basic

values’ according to its different ‘legal and social function[s]’.35 Hence Resnik’s

choice of primary IP values, which reflect in combination his view of the

different legal and social functions of the main IP regimes.

It is clear from Resnik’s essay that his values share the ‘midlevelness’ of

Merges’s principles, and exist as principles in the Dworkinian sense:36

32 This is apparent in his discussion of essential medicines, considered below.33 D Resnik, ‘A Pluralistic Account of Intellectual Property’ (2003) 46 J Business Ethics 319.34 The United States Constitution (n 12).

35 Resnik (n 33) 331. cf JIP 47.36 See RM Dworkin, Taking Rights Seriously (Harvard University Press 1978) 22ff; also J Raz, ‘Legal

Principles and the Limits of Law’ (1972) 81 Yale LJ 823; M Bayles, ‘Mid-Level Principles and Justification’ in



pr i l 1 4 ,2 0 1 5


. or g /

D o wnl o a

d e d f r om





































occupying an intermediary space between moral values and legal rules; deriving

their force from both their moral content and their fit with existing institutional

facts; and existing to be optimized in individual cases by a process of weighing

and balancing.37 While not expressed identically, Merges’s approach seems

very close to this, the main differences being: his choice of midlevel principles

(dignity, efficiency, non-removal and proportionality instead of autonomy,

privacy, utility and justice); his ‘one size fits all’ theory of IP; and his eschewal

of a method of decision-making which involves identifying the function of the

IP regime involved and/or weighing and balancing the principles at stake

according to the facts of the case. Indeed, weighing and balancing principles in

individual cases is all but obviated by Merges’s systemic account of IP, and

resort to the function of IP is supported only as part of an enquiry into the

purpose of IP in those exceptional cases in which a ‘tiebreaker’ between

principles subsisting ‘in equipoise’ is required.38

An initial question raised by this discussion is whether these arguments

regarding the theory and principles of IP are borne out by current legal

practice. For example, when interpreting and applying IP legislation, do the

courts routinely consider the purpose of IP, including the moral rights of

authors and inventors and/or the value to the public of having access to works

and inventions? Contrary to Merges’s suggestion the answer seems clearly to be

‘yes’, including in the USA.39 For example, in June 2013 the US Supreme

Court held that the patentability of isolated genes could not be determined

without regard to the purpose of the US patent system.40 In its opinion, as thatpurpose is to promote creation, and the act of isolating a gene from its natural

environment does not involve the creation of anything, isolated genes are not

patentable under US law, contrary to the position in Europe and elsewhere.

Such policy-based reasoning in IP is common, including in the UK, as two

further recent examples serve to demonstrate.

The first is Lucasfilm Ltd v Ainsworth,41 involving a claim of artistic copyright

in the storm trooper helmet from Star Wars as a ‘sculpture’ within the meaning

of the Copyright, Designs and Patents Act 1988. In considering the claim, the

JR Pennock and JW Chapman (eds), Justifications: Nomos XXVIII (New York University Press 1986) 49;K Henley, ‘Abstract Principles, Mid-Level Principles, and the Rule of Law’ (1993) 12 L & Phil 121; L Alexanderand K Kress, ‘Against Legal Principles’ (1996–97) 82 Iowa L Rev 739.

37 Resnik (n 33) 331.38 RP Merges, ‘The Relationship Between Foundations and Principles in IP Law’ UC Berkeley Public Law

Research Paper No 2130199 (July 2012) 14 <http://ssrn.com/abstract=2130199> accessed 13 August 2013. Seealso JIP 19 (‘It would take some real work to sort out, in a detailed way, how to reconcile these competingdemands to arrive at a coherent set of principles for a property regime.’)

39 See Merges (n 38) 14 (‘[T]here are not that many ties to break. There is no need to resort to lower levels of analysis in many cases.’)

40 Association for Molecular Pathology v Myriad Genetics Inc 569 US 12–398, 132 SCt 1794 (2013). For a

discussion see J Pila, ‘Isolated Human Genes: The patent equivalent of a non-copyrightable sound recording’(2013) LQR forthcoming; preprint available at http://users.ox.ac.uk/~lawf0169/pdfs/lqr_isolatedhumangenes.pdf .

41 [2011] UKSC 39, [2012] 1 AC 208.



pr i l 1 4 ,2 0 1 5


. or g /

D o wnl o a

d e d f r om


http://users.ox.ac.uk/~lawf0169/pdfs/lqr_isolatedhumangenes.pdf



































http://users.ox.ac.uk/~lawf0169/pdfs/lqr_isolatedhumangenes.pdf




Court noted the difficulty of understanding the legislative provisions in

question without reference to their original purpose and historical develop-

ment. According to its analysis, that purpose and development were very

different from those of literary copyright, which was introduced with the

utilitarian aim of protecting ‘the commercial interests of stationers (the early

publishers) and booksellers, and [controlling] unlicensed (and possibly

subversive) publications, rather than the vindication of the legal and moral

rights of authors’.42 In contrast to this, the recognition of artistic copyright in

three-dimensional objects was, the Supreme Court held, part of a scheme of

graduated protection aimed at distinguishing artistic from functional objects. It

followed that the category of artistic copyright in sculptures was to be

interpreted narrowly—‘quite unlike the protection afforded by the indiscrim-

inate protection of literary copyright’43 —so as to be confined to truly artistic

works, viz, works of an artistic nature created by a person meriting thedescription ‘author’, as distinct from mere ‘works with ‘‘eye appeal’’’.44 On the

basis of this definition, the helmet was held not to be a sculpture in which

artistic copyright subsisted.

So too in the patent case of Human Genome Sciences Inc v Eli Lilly,45 the

legislative purpose of IP protection helped to determine the legal issue in

dispute. That issue was the meaning of the requirement that an invention be

susceptible of industrial application in order to be patentable. In deciding it,

Lord Neuberger invoked his understanding of ‘the purpose of the patent

system’ as being ‘to provide a temporary monopoly as an incentive toinnovation, while at the same time facilitating the early dissemination of any

such innovation through an early application for a patent, and its subsequent

protection’.46 In his opinion, this purpose justified relaxing the industrial

applicability requirement for pharmaceutical inventions. The reason was the

particular importance of patents in the pharmaceutical field as a means of

securing funding for pharmaceutical research, and the public interest in

facilitating such research and (therefore) in facilitating the grant of patents to

assist in securing funding for it.

Four inferences of current importance may be drawn from these cases, eachof which challenges JIP while supporting Resnik’s approach. One is that the

principled application and development of IP depends on agreement over its

normative basis. Another is that one cannot understand its normative basis

without knowing something of its historical origins and function. A third is that

the various regimes that fall under the umbrella of IP do not have a uniform

history or foundation; and that even when restrictively defined to cover patents

42 ibid [14].43 ibid [48].

44 ibid.45 [2011] UKSC 51, [2012] 1 All ER 1154.46 ibid [99].



pr i l 1 4 ,2 0 1 5


. or g /

D o wnl o a

d e d f r om





































and copyright, IP is far from a monolithic legal entity. And a fourth (related to

this third inference) is that the purpose of IP regimes is understood differently

by different courts in different jurisdictions, with concrete implications for their

scope and application. Thus, and as reflected in the reasoning in AMP and

HGS above, whereas the US Supreme Court regards the purpose of the USpatent system as being to promote creation, the UK Supreme Court regards it

as being to promote innovation, including by ensuring that researchers have the

monopoly rights they need to attract the external funding required to pursue

their research.47 The result is very different implications for the scope of IP

rights, as the outcomes in AMP and HGS themselves demonstrate.

In sum, courts commonly invoke the historical and theoretical roots of IP

to assist in the interpretation and application of modern copyright and patent

legislation. In addition, it seems reasonable to expect that the day-to-day

importance of those roots will increase in the UK and other jurisdictions as aresult of the impact of European and international harmonization in promoting

teleological methods of interpretation and challenging UK understandings of

IP law and policy. On the other hand, other recent UK decisions point to a

further result of that impact in the form of an increased judicial reliance on

principles rather than foundational theory when interpreting and applying IP

legislation. An example may again be offered from recent UK Supreme Court

opinions, this time involving the scope of the EU exemption from copyright

infringement covering temporary acts of reproduction in the digital environ-

ment.48

According to the Court in Public Relations Consultants Association Ltd (PRC ) v The Newspaper Licensing Agency Ltd ( NLA),49 the lower courts’ view

of copyright as prohibiting any ‘consumption of [a] work,’ including any

unauthorized copying of a webpage made on a computer screen in the course

of internet browsing, was not justified by ‘the policy of the EU to maintain a

‘‘high level of protection of intellectual property’’’ as had been argued.50 The

reason, it held, was the need to read that policy in light of the EU’s further

commitment ‘to allow[ing] the ordinary use of the internet’.51 Thus, it was the

principles of ensuring a high level of IP protection and not impeding the

ordinary use of the internet that determined Lord Sumption’s opinion in PRC

v NLA, rather than the reasons (past or present) for such protection per se.

While this outcome seems contrary to that advocated in JIP ,52 the reasoning

47 cf Myriad (n 40) 2116 (excerpted at n 84). The theory of patents supported in HGS is effectively thatargued for in EW Kitch, ‘The Nature and Function of the Patent System’ (1977) 20 J L Econ 265–90, namely,that patents are prospects for developing technological opportunities. L Hoffmann, unpublished FHS patent lawseminars delivered at the University of Oxford (Hilary Term 2012).

48 Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on theharmonization of certain aspects of copyright and related rights in the information society [2001] OJ L 167/10(Information Society Directive) art 5(1).

49 [2013] UKSC 18, [2013] 2 All ER 852.50 ibid [8].

51 ibid.52 See ibid 83 (suggesting that a Kantian perspective of this issue would result in IP rights trumping the

interests of would-be licensees so as to require online permissions).



pr i l 1 4 ,2 0 1 5


. or g /

D o wnl o a

d e d f r om





































deployed in reaching it supports the turn from foundational theory to

principles that it is the book’s main purpose to support.

That one should see evidence of that turn in the UK’s Europeanised IP

regime is, it is submitted, unsurprising, given the importance of principles in

European law more generally. In addition, and further supporting Merges’s(and Resnik’s) analysis, that importance may be attributed to the function of

principles in pluralistic legal models as a means by which foundational (social

and legal) differences can be transcended via the pursuit of common ‘midlevel’

objectives.53 For example, in the European legal order it has long been

predicted that principles will displace the autonomous orders of EU Member

States and the conflicting traditions which underpin them in support of a form

of harmonization that accommodates legal and social diversity.54 The predic-

tion underlines the commonalities between the IP and EU legal fields on

account of the diverse traditions and philosophies on which each is built, andthereby explains the support which Merges’s pluralistic approach to IP receives

from European jurisprudence. Moreover, the analogy between Merges’s and

European principles-based legal models is underlined by the central role of

proportionality in each, reflected also in Resnik’s approach.55 In Merges’s

model that role is described as being two-fold. First, proportionality is said to

explain and justify the legal restrictions on the scope and enforcement of IP

rights; and second, as the midlevel principle, it is said to explain and justify the

function of principles in IP generally.56 Similarly in Europe, proportionality is

among the most important principles of the EU legal order, and serves twocentral functions to that end.57 First, it represents a constraint on the exercise

of EU legal competences and a means by which the primary values of the

European community are expressed and reconciled. And second, it supports a

model of law built around those values, each of which has a priori equality and

exists to be maximized via a process of weighing and balancing on the facts of

individual cases.58 At first glance these roles and conceptions appear to differ.

For example, in European law (and consistent again with Resnik’s approach)

53 See JIP xi, 10, 139–41. In Merges’s account this results in a conception of midlevel principles as

philosophically neutral, in the sense of being simultaneously explicable with reference to utilitarian and non-utilitarian arguments for IP. See n 83.

54 See eg N MacCormick, ‘Beyond the Sovereign State’ (1993) 56 MLR 1. See further G Itzcovich, ‘LegalOrder, Legal Pluralism, Fundamental Principles. Europe and Its Law in Three Concepts’ (2012) 18 ELJ 358.

55 cf JIP 159 (describing proportionality as ‘the most undertheorized of the four midlevel principles’, and as‘rarely identified as a stand-alone principle’).

56 See ibid 7, 159.57 See The Treaty on European Union [2010] OJ C83/13, art 5(4); T Harbo, ‘The Function of the

Proportionality Principle in EU Law’ (2010) 16 ELJ 158; A Ohly and J Pila (eds), The Europeanization of

Intellectual Property Law: Towards A European Legal Methodology (OUP 2013, forthcoming) chs 1, 8, 9, 13.58 See eg Campbell v MGN Ltd [2004] UKHL 22, [2004] 2 AC 457; Re S [2004] UKHL 47, [2005] 1 AC

593 [17] (Lord Steyn) (‘The interplay between articles 8 and 10 [ECHR] has been illuminated by the opinions inthe House of Lords in Campbell v MGN Ltd . . . . For present purposes the decision of the House on the facts of Campbell and the differences between the majority and the minority are not material. What does, however,

emerge clearly from the opinions are four propositions. First, neither article has as such precedence over theother. Secondly, where the values under the two articles are in conflict, an intense focus on the comparativeimportance of the specific rights being claimed in the individual case is necessary. Thirdly, the justifications for



pr i l 1 4 ,2 0 1 5


. or g /

D o wnl o a

d e d f r om





































proportionality is a methodological tool by which substantive principles such

as dignity and efficiency are optimized in individual cases via a process of

weighing and balancing, whereas in Merges’s account it is a substantive

principle, equivalent to dignity and efficiency. On closer inspection, however,

this difference dissipates. The reason is Merges’s definition of proportionalityas requiring that an IP right ‘not confer on its holder leverage or power that is

grossly disproportionate to what is deserved in the situation’,59 where what is

‘deserved in the situation’ depends on the social usefulness and value of the

subject matter in which the right subsists.60 Thus defined, proportionality in

Merges’s account supports a conception of IP rights as a fair (not grossly

disproportionate) market-based reward for an author’s or inventor’s provision

of an object having an identifiable social use and value. In this way it expresses

certain values and ensures that they are reflected in the detailed rules and

practices of IP. Whether those values are consistent with his foundationaltheory is another and more difficult question returned to below.

In sum, and like that of Resnik, Merges’s model of IP maps closely to

European legal models, making it unsurprising to find evidence of the turn to

principles which he supports in the UK’s Europeanized IP system, and natural

to look to that system as a further testing ground for his account of the day-to-

day operation of IP more generally.

3. Pluralism versus Utilitarianism in Merges’s Principles

The European Union has been active in the field of IP since the 1950s, when it

began work on the creation of unitary patent and trademark systems for the

then members of the European Economic Community.61 Its first IP legislation

was introduced in 1980, and followed in 1991 with the first EU copyright

Directive. Seven years (and several further copyright directives) later came the

first EU legislation in patent law, covering the field of biotechnological

inventions,62 followed in 2001 by a near-complete code for copyright in the

form of the Information Society Directive.63

Both the Information Society and Biotech Directives have had an enormous

impact on UK law. The Information Society Directive, being the more

extensive instrument, requires that EU Member States grant authors certain

interfering with or restricting each right must be taken into account. Finally, the proportionality test must beapplied to each. For convenience I will call this the ultimate balancing test.’)

59 JIP 162.60 See ibid 181.61 See generally J Pila, ‘Intellectual Property as a Case Study in Europeanization: Methodological Themes and

Context’ in Ohly and Pila (n 57) 1.

62 Directive 98/44/EC on the legal protection of biotechnological inventions [1998] OJ L213/13–21 (BiotechDirective).

63 Information Society Directive (n 48).



pr i l 1 4 ,2 0 1 5


. or g /

D o wnl o a

d e d f r om





































rights in respect of their works subject to certain permissible defences.64 Since

its introduction, the Court of Justice of the EU (CJEU) has been busy defining

who is an author, what is a work, and what acts copyright owners are entitled

to prevent. From its jurisprudence two main themes can be identified. The

first is that copyright exists to ensure a high level of protection for authors,

consistent with European traditions of authors’ rights and with the recognition

of copyright as a constitutionally protected species of property. Thus, the

CJEU has held that copyright subsists in and only in subject matter which

expresses an author’s own intellectual creation (in the sense of resulting from

an author’s free expression of his or her creative abilities and bearing his or her

personal mark), that it is limited in scope accordingly, and that its defences

must be interpreted restrictively as derogations from an author’s primary

rights.65 And the second theme is that the high level of protection for authors’

rights must accommodate certain third party rights and European publicinterests, including fundamental rights, the four freedoms of the single market,

and the need to promote technological development. Thus, the CJEU has

recognized legal certainty as a further reason for interpreting copyright

defences restrictively,66 the EU exhaustion doctrine as applying to all ‘transfers

of ownership’ for payment, including transfers of ownership effected by the

provision of a digital copy of a work,67 and mechanisms for enforcing copyright

on the internet as needing to take account of users’ privacy, freedom of

expression and data protection rights, in addition to service providers’ freedom

to conduct a business68 —each of which is guaranteed, alongside the protectionof IP, by the EU Charter on Fundamental Rights.69

It seems clear from these themes that the European copyright system is

premised on a ‘personal but unselfish’ rights model of IP similar to that which

Merges advocates.70 According to that model in its European guise, the aim of

copyright is to ensure a high level of protection for authors through the grant of

morally justified property rights, which also take account of third party rights

and public interests. On the other hand, and following from this, while EU law

also prioritizes certain operational principles in copyright, they are somewhat

different from the midlevel principles that Merges identifies. One reason istheir derivation from the EU Treaties and Charter rather than the detailed

64 See ibid arts 2–4 (rights), 5 (permissible defences).65 See eg Case C–5/08 Infopaq International A/S v Danske Dagblades Forening [2009] ECR I-6569; Case C–

145/10 Painer v Standard VerlagsGmbH [2012] ECDR 6; Joined Cases C–403/08 and C–429/08 Football

Association Premier League Ltd v QC Leisure and Karen Murphy v MPS Ltd [2012] 1 CMLR 29; Case C–604/10 Football Dataco Ltd v Yahoo! Ltd [2012] 2 CMLR 24.

66 See eg Infopaq (ibid).67 See Case C–128/11 UsedSoft GmbH v Oracle International Corp [2013] 3 CMLR 44.68 See eg Case C–275/06 Productores de Mu sica de Espana (Promusicae) v Telefo nica de Espana SAU [2008]

ECR I–271.69 Charter of Fundamental Rights of the European Union [2010] OJ C83/02.70 See n 5 and associated text.



pr i l 1 4 ,2 0 1 5


. or g /

D o wnl o a

d e d f r om





































rules and practices of copyright. Thus, in the European context, the operative

principles of copyright restate the established basic values of the European

community, thereby ensuring that the specific rules and practices of the regime

are tethered to those values. Hence the primacy among them of the free

movement of goods, services, people and capital throughout EU Member

States (guaranteed by the TFEU71 and expressed, inter alia, in Recitals (1) to

(4) of the Information Society Directive), the protection of property and

dignity (guaranteed by Articles 17(2), 1 and 13 of the EU Charter and

expressed, inter alia, in Recitals (3), (4), (9) and (11) of the Information

Society Directive), and the protection of freedom of expression and educational

values (guaranteed by Articles 11 and 14 of the EU Charter and expressed,

inter alia, in Recital (3), (14) and (34) of the Information Society Directive).72

The position is different with respect to the EU patent system. Still confined

to the field of biotechnology, that system is premised less on a ‘personal butunselfish’ rights model of IP73 than the utilitarian model reflected in the

decisions of the UK and US Supreme Courts above. According to that model

in its EU form (and consistent with the reasoning of HGS particularly), the

aim of the patent system is to promote European industry and the internal

market by ensuring sufficient harmonized legal protection to encourage

investment in biotech research and development74 while also respecting

national regulatory provisions regarding such research and development; the

public domain of (non-patentable) discoveries; and ‘fundamental principles

safeguarding the dignity and integrity of the person’,75 as well as values of individual autonomy and the right to have an opportunity to consent to the use

of one’s own biological materials.76 Thus, and as in European copyright, one

sees an emphasis on ensuring a high level of protection for inventors, albeit for

utilitarian rather than deontological reasons, and still subject to certain

Charter-derived third party rights and societal interests. Principal among those

rights are human dignity and the integrity of the person, which the Directive

recognizes as supporting the exclusion from patentability of a range of

biotechnological subject matter, in addition to informing basic principles of

patentability themselves.77

Among other things, this discussion draws attention to the way in which the

principles in Merges’s account are derived. Rather than stemming from the

71 Treaty on the Functioning of the European Union [2010] OJ C83/01.72 See Information Society Directive (n 48).73 See n 5 and associated text.74 Biotech Directive (n 62) especially Recitals (1) to (11).75 ibid Recital (16) (‘Whereas patent law must be applied so as to respect the fundamental principles

safeguarding the dignity and integrity of the person;’).76 See ibid Recitals (13), (14), (16), (26), (34).77 See ibid Recitals (16), (26), (38).



pr i l 1 4 ,2 0 1 5


. or g /

D o wnl o a

d e d f r om





































basic values of a community or IP regime(s), the source of Merges’s principles

is said to be the individual rules and practices of IP themselves.78 Those rules

and practices include: for non-removal, the exclusion of non-artefactual subject

matter (such as information and laws of nature) from copyright and patent

protection, and requirements of copyright and patent protection;79 for

efficiency, the patentability requirement for inventive step and the fair use

defence to copyright;80 for dignity, authors’ and inventors’ moral rights of

paternity and the fabric of all copyright systems;81 and for proportionality, the

fair use defence (again), and the rules limiting injunctive and compensatory

relief, preventing snippets of gene sequences from being patented, and

requiring that patent claims be commensurate with the specification’s

teaching.82

Given a pluralistic theory of IP, these explanations seem surprising, and

normatively less neutral than Merges suggests.83 For example, it seemscounter-intuitive to attribute the exclusion from protection of non-artefactual

matter and snippets of gene sequences to a concern for the public domain and

proportionality rather than the nature of IP as a reward or incentive for

intellectual creation—as they were indeed attributed in AMP —unless one

supports an exclusively utilitarian understanding of the purpose of patents.84

And so too it seems counter-intuitive to attribute the fair use defence to

efficiency, and a desire to prevent irrational refusals by copyright owners to

78 See JIP 140 (‘Midlevel principles engage foundational values in a number of ways, but they do not dependon any particular set of values for their validity. They spring from doctrine and detail, from the grain of actualpractice.’)

79 See ibid 142–43.80 See ibid 155.81 See ibid 156–58.82 See ibid 150–51, ch 6. On the connection between proportionality and the requirement that patent claims

be commensurate with the specification’s teaching see further J Pila, ‘Chemical Products and ProportionatePatents Before and After Generics v. Lundbeck’ (2009) 20 KLJ 489. On proportionality and patent scope moregenerally see J Pila, ‘Patent Eligibility and Scope Revisited in the Light of Schu tz v Werit , European Law, andCopyright Jurisprudence’ in RC Dreyfuss and JC Ginsburg (eds), Intellectual Property at the Edge (CUP 2013)ch 18.

83

See JIP 144–5 (principles are ‘theoretical or policy-oriented; yet because they are not rooted in any specificnormative framework, they avoid what might well be a fruitless debate if conducted at that level.’) See also ibid6–8, 130–31 (connecting efficiency and non-removal to utilitarian theories of IP, proportionality to Lockean,utilitarian and Rawlsian theories, and dignity to non-utilitarian and continental European IP systems). Comparethe view of Resnik (n 33).

84 The point is alluded to by Merges himself; see JIP 39. See also Mayo Collaborative Services v Prometheus

Laboratories Inc 566 US 10–1150, 132 SCt 1289, 1293 (2012) (justifying the exclusion from US patentprotection of natural phenomena, mental processes and abstract intellectual concepts with reference to thepurpose of patent law in promoting innovation. According to the Court, ‘monopolization of those [basic] tools[of scientific and technological work] through the grant of patent might tend to impede innovation more than itwould tend to promote it.’); Myriad (n 40) 2116 (‘As we have recognised before, patent protection strikes adelicate balance between creating ‘‘incentives that lead to creation, invention, and discovery’’ and ‘‘imped[ing]the flow of information that might permit, indeed spur, invention.’’. . . We must apply this well-establishedstandard to determine whether Myriad’s patents [in respect of isolated human genes] claim any ‘‘new and

useful. . .

composition of matter’’’); but cf Myriad (n 40) 2116–17 (justifying the exclusion from US patentprotection of isolated human genes (as products of nature) with reference to the purpose of patent law inpromoting creation, and the consequential need for an act of creation to support a patent).



pr i l 1 4 ,2 0 1 5


. or g /

D o wnl o a

d e d f r om





































license the use of their works (as Merges does85), rather than, for example, to

autonomy, and a desire to protect its instantiation in such third party rights

and interests as freedom of expression and education—unless one again

supports an exclusively utilitarian understanding of the purpose of copyright.

This is particularly given the widespread connection of the fair use defence to

such rights and interests, the centrality of autonomy to Merges’s foundational

theory, the difficulty of squaring that theory with the view of fair use which

Merges advocates, and the law-and-economics premise of that view in a

conception of copyright as conferring a right to a certain market power with

respect to a work (rather than a right to exclude others from its use).86

Regarding the latter particularly, even if we accept Merges’s claim that

autonomy requires a conception of IP rights as including ‘a right to try to make

some money’87 —a claim which seems doctrinally and normatively problem-

atic88 —it does not follow that IP rights confer only such a right. To suggestotherwise seems difficult to defend other than on an explicitly utilitarian

understanding of IP as existing to facilitate a market in IP rights and their

related subject matter for economic or other societal reasons.89

The same utilitarian bias underpins Merges’s discussion of patent rights and

essential medicines. There he writes that as ‘[t]he dignity interest of researchers

who develop the drug is not directly at issue, [and] nor is the nonremoval

principle’, the issue of access to essential medicines is appropriately conceived

as one ‘of efficiency and, to a lesser extent, proportionality’.90 The result is a

discussion in which considerations of utility again eclipse the individual rightsand interests of third parties, notwithstanding the well-established link between

dignity and health care,91 and the centrality of dignity to both Merges’s

foundational theory and operational model of IP. Thus, he writes, that ‘the real

question’ is not whether human rights trump property rights to require access

to essential medicines, but ‘what is the best way to maximize the number of

effective pharmaceutical products that are brought to bear on [human]

85

See eg JIP 155, 251 (describing Merges’s ‘enthusiasm for individual IP rights’ as putting him on ‘the sideof those who would be cautious in finding a particular practice to be fair use, lest a rush to apply the fair uselabel will stifle the formation of a market.’)

86 This is consistent with Merges’s further claim that ‘[a]uthors gain nothing without a market’: JIP 155; butcf JIP 295 (‘the essence of property is the right to exclude’ (emphasis added)).

87 JIP 81; see also ibid xi, 40.

88 IP rights do not confer a right to use a particular subject matter, much less exploit it commercially. See egBiotech Directive (n 62) (14) (‘Whereas a patent for invention does not authorise the holder to implement thatinvention, but merely entitles him to prohibit third parties from exploiting it for industrial and commercialpurposes’). And so too normatively, the conception of property rights as rights to turn a profit has no clear basisin accepted understandings of property.

89 On the utilitarian premise of market failure views of fair use see M Spence, ‘Intellectual Property and theProblem of Parody’ (1998) 114 LQR 594.

90 JIP 278.

91 This connection has been particularly influential in Indian patent law; for a discussion see J Pila, ‘SomeReflections on Method and Policy in the Crowded House of European Patent Law and their Implications forIndia’ (2012) 24 NLSIR 54.



pr i l 1 4 ,2 0 1 5


. or g /

D o wnl o a

d e d f r om





































diseases?’92 The result is the same conclusion as that reached by Resnik. In

Resnik’s account, however, it is the product of ‘a careful balancing of three

values—utility, autonomy, and justice—in light of the facts and circumstances

of the case’,93 and a view of utility as having special weight on account of

the function of patent law in ‘promot[ing] the progress of science and theuseful arts’.94

In sum, the emphasis on market-based considerations of efficiency and

proportionality in Merges’s model of IP enables utility to eclipse the values

which he professes to hold most dear in his foundational theory, including

those of autonomy and dignity, thereby undermining that theory and the

pluralistic claims of his model itself.

Two questions arise from this. The first is: what would an IP regime, which

did prioritize those values, look like? And the second is: to what, if any, extent,

can European law itself be said to support such a regime? In the final section of this article these questions are considered with reference to the UK’s

Europeanized fair dealing defence and exclusions from European patentability.

4. Taking Autonomy and Dignity Seriously in IP

In UK and European copyright law, third party rights and societal interests are

mainly protected after the establishment of a valid IP interest, at the point of

deciding: (a) whether a competing interest is also engaged by the allegedly

infringing act, so as to enable a legislative or other copyright defence to beraised; and (b) the implications of any such interest and defence for the

defendant’s liability and the claimant’s entitlement to relief. Thus, to identify

the reconciliation of competing rights and interests in copyright we need to

look beyond its general tests of subsistence and infringement to its statutory

and other defences and remedies. And of central importance in that regard are

the fair dealing defences, which—and as noted above—permit dealings with a

work for the purpose of criticism or review, reporting current events, and non-

commercial research or private study provided they are ‘fair’. Hence the role of

the courts in effecting the balance between IP owners’ and third party

fundamental rights in UK copyright via determinations of fairness.

In the UK, as in other common law jurisdictions, the established approach to

determining fairness is to consider the same list of factors that govern

determinations of fair use in the USA. Those factors include the purpose and

extent of the use, the impact of the use on the copyright owner’s market and

the extent of the work’s prior circulation to the public.95 Of primary

92 JIP 278–79. According to Merges, the only situation in which ‘infected people’ ought to be permitted ‘tooverride patent rights’ is where a single life is at stake. See JIP 280.

93 Resnik (n 33) 332.

94 The United States Constitution (n 12).95 See eg Ashdown v Telegraph Group Ltd [2001] EWCA Civ 1142, [2002] Ch 149; NLA Ltd v Meltwater

Holding BV [2010] EWHC 3099 (Ch), [2011] EWCA Civ 890, [2012] RPC 1.



pr i l 1 4 ,2 0 1 5


. or g /

D o wnl o a

d e d f r om





































importance is whether the use of the work was for a commercial purpose or

competed with the copyright owner’s market. If it was or did it will be regarded

as presumptively unfair, and thus not capable of supporting a fair dealing

defence.96

This is broadly consistent with Merges’s account of the USA’s fair use

defence, as well as with the CJEU’s emphasis on ensuring that exceptions to

copyright are interpreted narrowly. On the other hand, it is very different from

the manner in which the fundamental rights of third parties are protected in

European patent law. In that context the CJEU has held that dignity-based

exclusions from patentability must be interpreted expansively in recognition of

the importance of the value underpinning them.97 In addition, it has held that

when determining whether an invention is excluded from patentability on

morality or public policy grounds, the history of its derivation is relevant,

including whether any biological materials thereby required were consensuallyobtained.98 When considered alongside the treatment of the freedom of

expression and education-based defences of copyright, the inescapable impli-

cation is that dignity and autonomy interests weigh more heavily in the balance

with patent rights than freedom of expression and educational interests weigh

in the balance with copyright.

There are various possible explanations for this differential treatment of third

party rights and interests in copyright and patent law, the most obvious

being the different nature and justificatory basis of the IP and other rights in

question and/or the extent of their perceived conflict. Before accepting suchexplanations, however, it is important to note that whereas in patent law the

position described is a product of the Biotech Directive, in copyright it is a

product of the UK courts’ adoption of the factors-based approach to fairness.

To the extent that approach receives positive support from European

legislation, it is via the three-step test of Article 5(5) of the Information

Society Directive, which has recently been read down by the CJEU as adding

nothing of substance to the individual defences of Article 5(1)–(4).99 Given

this, it seems important to enquire further into the consistency of the UK

courts’ test of fairness with European law, including EU fundamental rightsand the principle of proportionality. And doing so reveals its problematic basis.

Specifically, and assuming that the rationale for the fair dealing defences is to

protect third party Charter rights to freedom of expression and education

(which it seems clearly to be), and that the statutory definitions of the

permitted dealings do represent the legislative expression of that rationale

(which they seem clearly to do), the implication is unavoidable that—according

96 ibid.97 See Case C–34/10 Bru stle v Greenpeace eV [2012] CMLR 41.

98 See ibid.99 See eg Football Association Premier League Ltd (n 65); Case C–302/10 Infopaq International A/S v Danske

Dagblades Forening (CJEU, 17 January 2012).



pr i l 1 4 ,2 0 1 5


. or g /

D o wnl o a

d e d f r om





































to European jurisprudence at least—the additional requirement that the dealing

be fair is a requirement for proportionality.100 It then follows that the European

test of proportionality ought to apply. This gives rise to the question of what

that test requires.101 The answer would seem to be a test of fairness that asks

whether the restriction on copyright represented by a finding of fair dealing

would be proportionate having regard to the legitimate (freedom of expression

or educational) value which that restriction serves in the particular case. This is

a very different formulation from that supported by Merges and the UK courts

currently, and leaves little if any scope for considering the defendant’s

motivations in using the work or its commercial impact, particularly on a

view of IP as conferring rights of exclusion rather than rights of commercial

use.

One final point seems apposite in this context, which is the possibility of

explaining the UK and European third party restrictions to copyright andpatent law above with reference to the social norms which they support. That

explanation depends on an expressivist reading of each, as insulating certain

social spheres from profit-driven behaviour so as to protect the values of

human dignity and autonomy from debasement. Specifically, by denying

property rights to subject matter involving human biological materials, and

denying fundamental rights protection to commercially motivated or profitable

acts, IP law can be said to protect the human being and rights to freedom of

expression and education respectively from being demeaned.102 The suggestion

returns us to the discussion above regarding the relationship between moneyand fundamental rights in IP, and between its moral and utilitarian aspects

respectively.

It is submitted that an ambivalent view of this relationship runs through JIP ,

and accounts for the tension between Merges’s foundational theory of IP on

the one hand and his account of IP rules and principles on the other. In

addition, Merges’s recent response to this criticism of his book with reference

to the different concerns of theory and principles, respectively—the former

being with the whether or why of IP and the latter with its how103 —is

undermined by the effect of his account of IP’s how in ensuring a system whichreflects a specific and single view of its why. That view seems not only to defeat

the pluralistic claims of his model, but also to displace his deontological theory

of IP for one grounded in utility. Among other things, the result is an account

which has less normative value than it might otherwise have, particularly with

respect to legal systems (such as the UK’s Europeanized system of copyright)

which purport to take individual rights and interests seriously but then fail

100 See Pila, ‘Patent Eligibility and Scope Revisited’ (n 82).

101 See ibid; n 58.102 See C Sunstein, ‘On the Expressive Function of Law’ (1996) 144 U Penn L Rev 2012.103 See Merges (n 38) 1ff.



pr i l 1 4 ,2 0 1 5


. or g /

D o wnl o a

d e d f r om





































properly to instantiate such rights and interests in the rules and practices of

their IP regimes.

5. Conclusion

From a European copyright perspective there is much in JIP that seems

descriptively correct, including its ‘personal but unselfish’ rights theory and its

support of a pluralistic, principles-based model of IP.104 On the other hand,

Merges’s theory of IP sits uncomfortably with the utilitarian underpinnings of

both European and domestic patent systems, and so too his account of the

operational unimportance of foundational theory is challenged by its use in

domestic judicial decision-making. Further, both European jurisprudence and

Merges’s argument for IP problematize his selection and conception of midlevel principles by highlighting their utilitarian bias. The result is a model

of IP decision-making which reverses at the practical level the shift that Merges

effects at the theoretical level from utility to fundamental rights, and which

thereby undermines its own pluralistic claims. This result is perhaps most

apparent in the omission of autonomy from his midlevel principles, notwith-

standing its centrality to his justification for IP, and in his conception of

proportionality as a means of ensuring that IP rights trump in all but the most

exceptional, market failure cases, rather than a means of ensuring that IP rules

and practices support the established basic values of the communities orregimes in which they exist, including by ensuring that those values are

expressed and optimized in individual cases. In these respects, Resnik’s own

pluralistic approach – significantly shorter and less detailed in exposition

though it is—may still have the upper hand over the approach in JIP .

My critical engagement with JIP in this review article ought not to be read as

detracting from the very substantial contribution that it makes. The mere fact

of a US scholar as distinguished as Merges rejecting the standard utilitarian

arguments for the existence of IP is of itself sufficient to make the book of

interest. But beyond and more important than this, JIP represents animportant and enormously stimulating contribution to IP scholarship in its

direct engagement with the theoretical and operational foundations of the

copyright and patent systems particularly, including its use of classical legal

theories of rules and principles to explain those systems’ current form and

development. While strongly informed by US law and jurisprudence, it

transcends jurisdictional divisions to offer insights on questions, which, while

old, have great contemporary relevance and importance, including for the

pressing challenge of finding ways to accommodate different IP rules and

policies in the increasingly harmonized field of intellectual property.104 See n 5 and associated text.



pr i l 1 4 ,2 0 1 5


. or g /

D o wnl o a

d e d f r om



































8 pluralism, principles and proportionality in intellectual property

Documents