4.The perm is the tragedy of the anti-commons – wrecks solvency and innovation
Sousa e Silva 14 [Nuno de Araújo , Graduated in Law from the Porto Law School of the Portuguese Catholic University, in 2011.Master in Law from the Faculty of Law Catholic University - Porto, in 2013., Master of Laws (LL.M.) in Intellectual Property and Competition Law at the Munich Intellectual Property Law Center - Munich, in 2013., “The Ownership Problems of Overlaps in European Intellectual Property,” MIPLC Studies, MIPLC = Munich Intellectual Property Law Center, https://www.nomos-elibrary.de/10.5771/9783845254494/the-ownership-problems-of-overlaps-in-european-intellectual-property?page=1, ALB]
The specific overlap problem I’ve chosen to tackle in this paper relates to ownership. What happens when two (or more) different people own different rights whose object is the same? How should we approach a situation where objective cumulation is not mirrored by subjective cumulation?19
The following considerations assume that there are no express contractual provisions dealing with ownership issues. 20
2. Why are split ownerships a problem? The phenomenon of overlapping rights with different owners (split owner ship) occurs systematically in relation to copyright and neighbouring rights. It is part of a wider aspect of modern copyright known as fragmentation.21 If A records B singing a song composed by C (actually, music by C and lyrics by D), and a third party wants to explore the recording: (s)he will have to gather licences from all these people, unless A has already done so and his licence allows sub-licensing.
The combined efforts of the copyright legislator and the market forces have generated mechanisms to deal with the fragmentation phenomenon such as collective management organizations,22 the connected works doc trine, deemed authorship in movies23 and compulsory licensing.24 Further more, market participants are also cognisant of the necessities generated by fragmentation and act accordingly, mainly through contract.
In the case of overlaps involving different IPRs there is no collective management in place and market participants seem to be less aware of the problem. This can lead to a tragedy of the anticommons. As defined by Heller: “In an anticommons (…) multiple owners are each endowed with the right to exclude others from a scarce resource, and no one has an effective privilege of use. When there are too many owners holding rights of excl sion, the resource is prone to under use – a tragedy of the anticommons.”26 One example presented by the Author was found in post-socialist economies. In the transition – "from Marx to markets" – there was a fragmentation of rights in Moscow's storefronts, multiple rights to the same property were distributed amongst several stakeholders.27 Thus, a person interested in using a shop would need to collect all rights in order to operate. These high transaction costs explained the empty stores in Moscow, an underuse.28 In a later article, with Rebeca Eisenberg,29 Heller makes the same analysis re garding biomedical research and upstream patents, preventing downstream innovation.