say controversial things. On that topic, I am going to go against Jamie Boyle's support of what I call the togetherness principles.
Let me talk about the three IP areas: patents, copyrights, and database protection. In the area of patents, probably unquestionably in the past few years, the most cataclysmic development has been the policy following State Street Bank of allowing patents over business methods. The business method patent issue is not something the scientific community should dwell on at great length because it is not likely to affect it a great deal. Business method patents are probably not a place where the scientific community could have a great deal of influence in turning the tide. IBM, which is consistently the number one patenting entity in the United States, is against business method patents. Of course, the reason is because IBM has been patenting everything else, and they did not think to patent business methods. They suddenly found themselves outflanked by Dell Computer, who forced them to take several patents on Dell business methods.
In the patent area, the important issues that the scientific community has rightfully focused on are patenting of research tools and of express sequence tags. The scientific community needs to approach these issues and ask whether there is a problem because there has been a lot of good legal scholarship that identifies problems in the area of research tools and express sequence tags, an anticommons problem of too much propertization, too much overlapping of property rights. Recently, there was a study done by Wes Cohen of Carnegie Mellon and others that, admittedly with a small sample, concluded that there was not yet any breakdown, any anticommons problem because of IP. There are undoubtedly some increased transaction costs and there are clearly financial transfers going on, but there is not yet the kind of breakdown that Professor Reichman talked about. Why not?
One reason is there is not much enforcement, which is very important because law professors tend to focus on what the law is; whereas as activists you need to be concerned about how the law is enforced. It appears to be the case that the holders of research tool patents to date do not seem to go after universities or nonprofit research. Another issue is to what degree this patenting of research tools has benefited the university community. When you look at the statistics, it is interesting because when you take the U.S. patent pool as a whole, fairly consistently year in and year out, universities—both private and public institutions—command about 2 percent of the patents. However, in certain biomedical categories of patenting, the university numbers are much higher. In the mid-1970s in three of those categories, universities had about 8 percent of the patents. In those same categories by the mid-1990s, universities had 25 percent of the patents. So, if patent fees and licensing fees are being paid, an increasing percentage of them are being paid to universities. That does not necessarily mean more money for research. We have to be honest about that. That could just be transaction costs and that could just mean that universities are hiring more technical management officers and more patent lawyers.
There is a real issue of studying and looking at what is happening in these areas. I said that the standard that you have to take into the battlefield, if you want to do this in a principled way, is there should be no major change in the law until you can show a good empirical or theoretical case. I think that is true for major changes in the law. For smaller changes in the law, it is all right to advocate reform on the basis of your intuitions and on the basis of what you believe is the right way to tinker with the system. As James Boyle said earlier, we are experimenting with a massively important entity, operation, and aspect of our society. If you propose a major change, you might sink the whole ship, but if you propose tinkering and small amendments, you have a different way of organizing opposition procedures of the U.S. Patent and Trademark Office (PTO) or you have a slightly different way of organizing exceptions for encryption or reverse engineering. That is something that I think you should go out and advocate. On that count, I think it was very good that people forced the issue with the PTO about patenting of express sequence tags, because that forced the PTO to reevaluate the issue and in a sense back down. As a result, there is substantially less patenting and stricter patenting in this area of biomedical technology.
Let me turn to copyright issues. Here science has to decide, as a community, its place in the broader battlefield. I think that the togetherness principle might be the right strategy, but it might also be the wrong strategy. Paul Uhlir and Jerry Reichman presented about the possibility of an express research commons, separate from our general understanding of the public domain.