MAKING MONEY

IVAN HOFFMAN, B.A., J.D.


        There seems to be a significant number of people who demean making money.

        Making money is always a sensitive subject for many reasons, not the least of which is that there is something inherent in the Puritanical ethic on which our nation was founded that somehow teaches that doing so is morally suspect if not outright improper.  That nearly everyone not only has to make money but strives to do so if only in secret and despite protestations to the contrary is one of the great dysfunctionalities of these protestations.  The essence of the claim is that while it is true that everyone needs money, we should not make the most money we can but should allow others to make the money we might otherwise be entitled to make ourselves.  Such a position runs contrary to human nature, although it makes for “politically correct” cocktail party jabber.   Often those proclaiming this position couch their argument in the form of making a “fair” deal without realizing that the term “fair” has no objective meaning at all and that what is “fair” to one side is often perceived by the other as being “unfair.”

        When I write about making money, inherent in my writing is that doing so is completely compatible with the eastern philosophy known as “right livelihood” which teaches us about earning money in a socially acceptable manner.  But, as with “fair,” the line as to what is or is not “socially acceptable” is not a brightly drawn red line but is instead subjective, fuzzy and often in muted tones of ecru.  I have always believed that teaching people how to make money in a way that enhances their self-worth and personal dignity is worthy of being included in the concept of “right livelihood.”  Depriving oneself of that opportunity seems completely self-defeating and if there is any “wrong livelihood,” that would certainly be one example.

        Since I practice intellectual property law and since I presume that you are reading this article because you are in the intellectual property business in one form or another, let me address the issues about making money from and with IP.   It is problematical for me to see what appears to be the claim that fully exploiting one’s intellectual property and related rights is somehow morally repugnant or at least is deemed to be “gouging,” or “exploitive” or “money grubbing” or similar disparagements or is not “right livelihood.”

The Expanding World of Rights

        Two of the areas that intellectual property law deals with are copyrights and trademarks.  As media has greatly expanded due to technology, rights that encompass intellectual property have correspondingly expanded.   The claim of the dissenters is that the continued press of rights owners to claim more and greater sources of income as part of their rights is somehow wrong and to be discouraged.  The claim is wholly without merit.

        Rights in copyright are often referred to as a bundle of rights.  Copyright is not unitary, not some monolith, but the enumerated rights set forth in the statute (17 United States Code section 106) including but not limited to the right to make derivative works, are flexible.  As but one example, one of those enumerated rights is “right to reproduce the copyrighted work in copies.”   At the turn of the 20th century, if you wrote and composed a song, you were pretty much limited to the making of money by the sale of printed sheet music.  Technology had not expanded much beyond that at that time.  But then along came Edison and his phonograph and then you could license rights to your song to those who would produce the early progenitors of the record and later the CD or the MP3 (or in copyright lingo, “phonorecords.”  You should read “The Use of Music on a Multimedia Web Site.”).   And somewhere along the way came radio and you could make money from the public performance of your song, another of the enumerated rights.  And then we developed motion pictures containing sound and all of a sudden this technological leap afforded you the opportunity to license and make money from your song from synchronization and other rights.  And then we saw the advent of television with the corresponding ability to further license the song for use on television shows.  And who could forget the cries coming from the copyright world when the VCR was developed or the “thank yous” that came when videos became a source of significant income?  And so on.

        Were there dissenters around during each of the above phases to claim that expanding into those new areas was reprehensible or was not “right livelihood?”  Or not “fair?”

        And here we are now in the Internet age and technology has opened new definitions of “copies” yet again.  We have uses on web sites, we have peer to peer networks, we have ring tones for our cell phones using musical compositions, we have downloading of movies and television shows to one or another handheld device (leaving aside the question why anyone would want to watch a movie on a handheld device, which is a marketing issue and not a legal one and thus beyond the scope of this article) and other such and other forthcoming uses.

        Rights in trademark, which are designed to protect identification as to source, are similarly flexible in that as markets expand, the opportunities to “brand” a good or service correspondingly expands.  Could anyone have imagined 50 years or so ago that people would want to wear clothing with the brand on the outside?  Yet today, demeaning comments are often leveled at trademark owners seeking to prevent poachers from using such marks or marks confusingly similar for domain names and on web sites including as meta tags and key words.

        Let me go on.  A few years ago the United States Supreme Court ruled that Congress was within its constitutional authority to extend the term of copyright protection for an additional 20 years including as to currently existing copyrights.   This decision has become the cause celebré of the dissent set.  Their rallying cry is that rights holders are just looking to make more money.  And they are right of course.  But the fallacy of their argument is that they claim, expressly or by implication, that but for the extended term, that somehow “society” or “the public” would benefit by the free use of what would then be public domain material.  This argument is completely disingenuous because there was nothing in the case that indicated or indeed in human nature that indicates that such would be the result.  It is worth remembering that that the Petitioners in that case were not seeking a declaration that the said extension was unconstitutional for the purpose of benefiting something as illusory as “society”  or “the public.”  There was no implication that any savings the Petitioners achieved by not having to license the material was going to go toward the benefit of that “society” or “the public.”  The only bono (as in pro bono) that was involved in the case was in the title of the said act (the Sonny Bono Copyright Term Extension Act). This was a purely commercial litigation on both sides.  To repeat the language of the Court:

Petitioners are individuals and businesses whose products or services build on copyrighted works that have gone into the public domain.
        Thus there is nothing that makes the commercial motivations of one side better or higher in value than the same motivations of the other.  Yet you would never know it to listen to those who would have us believe that making money from the extended protection of valuable copyrights is morally repugnant or at least “unfair.”

Self-Interest

        There is nothing wrong and indeed everything right about legally protecting one’s rights and utilizing them to the fullest extent allowable.  Not only is this comporting with what the law allows (read “The Law” and “Capitalism.”) but failing to do so runs contrary to one’s self-interest and seems to express a lack of personal dignity.

        As I wrote in “Self Interest” :

And if you fail to take care of your self-interest, you may likely perceive the other party to be “unfair” or to be to “blame” for your failures.  Failing to recognize the other’s said motivations to take care of their own self-interest is an abdication of personal responsibility that ultimately leads to frustration, blame and regret.
The Bottom Line

        Whether you make the money or not, the money is going to be made.  The bundle of rights of copyright, the rights inherent in trademark are not going to disappear because you believe that to exploit them is immoral.  These rights are going to be exploited by some party.   I do not understand how it enhances one’s dignity and self-respect to have the other party make the money and not you.

        Because the world of rights is expanding at a rapid pace due to technology, each party should approach their negotiations and creativity with the mantra “Own Everything.”  Read “Private Laws” and “Dignity In the Deal.”

        Making money is a form of personal expression.  Utilizing all of our personal, and business, assets is a form of saying “I deserve the best.”
 

Copyright © 2006 Ivan Hoffman.  All Rights Reserved.

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This article is not legal advice and is not intended as legal advice.  This article is intended to provide only general, non-specific legal information.  This article is not intended to cover all the issues related to the topic discussed.  The specific facts that apply to your matter may make the outcome different than would be anticipated by you.  This article is based on United States law.  You should consult with an attorney familiar with the issues and the laws of your country.  This article does not create any attorney client relationship and is not a solicitation.

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