Friday, January 8, 2010

One Happy-Face Cookie Maker Sues Another Happy-Face Cookie Maker

This is the problem with government recognizing Intellectual Property as actual Property.

You can read about it here.
Eat'n Park, a Pennsylvania bakery and restaurant chain, says it has caught Plano-based Cookies by Design selling smiley-face cookies that it says are "confusingly similar" to its own.

And it's suing.
Recognizing intellectual property is essentially guaranteeing the value of property for the alleged owner, as exemplified in this case. Eat'n Park is worried they will lose sales to Cookies by Design because they both use a happy face on their cookie. Losing sales = loss of value. Eat'n Park then takes Cookies by Design to court requesting that Cookies by Design be shut down to essentially protect the value of an attribute of Eat'n Park's product (the face with the perky smile).

Given that value of any property fluctuates bases on an endless list of factors, at what point does it make sense for government to play the role of protecting and sustaining the value of a piece of intellectual property? Never. No matter the prior investment, the origin, or the age of the innovation, the value (and therefore the intellectual property) should never be protected by government, if not for any other reason than it is impossible.

Property only exists because scarcity exists; because scarcity exists, property has value. Lets look at two different resources that are both valuable in use, but have very different values in reality: air vs. oil.

Air is very useful; in fact, so useful that if we ran out of air, humanity would cease to exist. The great thing about air is that there is an unlimited supply. Because air is unlimited, it is not scarce, and therefore has no value; it is not considered property. I cannot steal your air, I cannot use your air, I cannot sell your air.

Oil is also very useful; in fact, so useful that if we ran out of oil today, the human population could easily be cut in half due to starvation. We simply wouldn't be able to efficiently distribute food. The unfortunate thing about oil is that there is a very limited supply, and it takes time and investment to obtain. Because its limited and divisible, it can be owned, and therefore it becomes property. I can steal your oil, I can use your oil, I can sell your oil. In all cases you lose your oil; you lose property.

Ideas are like air in that they are unlimited in quantity. One person can have an idea, communicate it to another person, and then they both have same idea without the first person losing ANYTHING. Even without the communication of the idea, a million people could have the exact same idea all at once. In this case it would be indistinguishable as to who owns the idea. We look to government to make this determination, but why? Why should government have the role of labeling one person of the million as the owner of the idea while limiting the use of this idea by the other 999,999 people? In the end, isn't this protection of "intellectual property" simply a suppression of free expression which is the hallmark of any free society? Doesn't it also lead to the suppression of progress and innovation?

The perspective that one can own an idea has deep roots in our society and is not likely to change anytime soon, but every time some moron decides to sue someone for using their happy-face trademark, it should at least provoke a reconsideration of this perspective.

In the end, the protection of "intellectual property" is another example of the corporate sector mis-using government to protect themselves against entrepreneurs, small-businesses, and the little guy. That is a topic for another time.


Christopher Furlong: said...

Tell that to the capitalists. LOL.. Reality versus Josh's ideal.

Josh said...

Even in the world of Austrian economists this is a contested topic. I don't care if others thing I'm wrong if I know I'm right.

Christopher Furlong: said...

Tell that to the really existing capitalists.