by Mike Masnick

Intellectual Property Fights Move Into The Restaurant Business

from the ugh dept

When trying to explain the problems of today's intellectual property system, it's often useful to use pizza shops as an example. Competition is natural. No one, the idea goes, should feel that a competitor opening up a pizza shop down the street somehow "infringes" on another pizza shop. It's just basic competition -- the same type that has helped grow and benefit society for ages. However, in our over-lawyered age where suddenly everyone is looking for ways to apply the monopoly powers of intellectual property law to their own business, this may be changing. Just like there's a push underway to introduce new monopoly rights into the fashion industry in spite of (or, in fact, because of) a thriving competitive market, it appears that lawyers are now looking to do the same in the restaurant business. The NY Times writes about a restaurant owner who is suing the owner of a competing restaurant. It is true that the second owner used to work for the first, but saying he then cannot open a competing restaurant is ridiculous (and, is pretty clearly allowed by the law).

There are some amazingly ridiculous statements in the article. For example, the owner of the first restaurant, Rebecca Charles, is most upset by the fact that the owner of the second, Ed McFarland, offers a Caesar salad that Charles insists McFarland copied from her recipe. Of course, even she admits that her mother got that recipe from another restaurant, but doesn't seem to note the irony of then claiming ownership of it herself. Also, Charles admits that she based the idea for her restaurant on another restaurant. Looking at the menu for Charles' restaurant shows that she sells New England Clam Chowder... clearly invented by others. Is she paying up for that intellectual property? Of course not. The law is pretty clear on this one that she has no case -- and that's for a good reason. Imagine if there could be only one pizza shop in all of New York. Or only one oyster bar. That's ridiculous and would harm just about everyone. However, in this age where monopoly rights are bizarrely considered a good thing, it's no surprise that we're seeing a push to go in that direction.

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  1. identicon
    Don, 29 Jun 2007 @ 2:04pm


    Oops, I forgot the second part - it's also dangerous because it ignore competition and the global marketplace. If this country continues to make it too difficult to do business, those innovators of today will simply move their efforts to markets that are more conducive to their efforts. India, for example, will have something like 400 million people moving into adulthood (and the consumer and workforce markets) over the next 20 years. That's an emerging market that's a good 30% greater than the entire population of the US. As the gap between technological and industrial levels between the two nations continues to shrink with each passing week, month, year, that market will become harder and harder to ignore (same goes for China to some extent, except China isn't a democracy like India or the US are, although the are becoming increasing capitalistic despite their form of government). Eventually a company will comes along and leverage a Microsoft (to use a classic example) the way Microsoft did IBM to achieve market dominance. However, if America continues down the path it's treading now, that company is increasingly likely to be a foreign one.

    Then there are companies like Sony (not an American company) which is a perfect example of how a company can "game" the capitalist system, even though when you really look at their philosophy and the way the conduct business they aren't really a firm believer in capitalism (it's clear they have more of a "feudal" philosophy, except instead of the "landholders" of old, they're "IP" holders who "rightfully" own all the product you just "lease"/use with their permission), they just use it to their advantage until they have enough muscle to try to enforce their ideological standards.

    It's not very hard to extrapolate these current trends to see that if they continue, America stands a very good chance to be a second rate country in about 50 years from now.

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