IP litigation and rulemaking involve lobbies making concessions – not dramatically shaping outcomes

This Article concludes that there are two principal reasons that customized IP regimes so often disappoint their aspirants. First, the interest groups campaigning for these specialized systems resemble fractals: within every seemingly united, homogenous coalition is a set of smaller, squabbling parties who seek to advance their own gains even at the risk of failure for the larger enterprise.30 Often, these fracture lines divide, crudely, the copyists from the creators. In the same industry, some firms tend to innovate, others duplicate, and some do both. These interests tend to conflict, forcing coalitions to choose between narrower rules that are more politically feasible and broader ones that offer greater pecuniary advantages. Second, despite their expertise and private information, interest groups are no better at predicting economic and technological change than any other observer.31 They tend to encase in regulation the business models of the moment, making these rules brittle and ill-equipped to adapt to the changes that inevitably occur. It is a temptation that is perhaps impossible to resist: the current architecture suits its inhabitants, and innovation is likely to be disruptive.

The normative conclusion flowing from these findings is surprising if not shocking: there is less to be feared from customized IP regulation than one might expect, because internal structural weaknesses are often its undoing. This may hold true beyond intellectual property, extending to other areas where coalitions are unexpectedly diverse and regulating technology is a tough trick to perform.32 History’s lessons are difficult to learn: the drafters of the VHDPA (covering boat hulls) in 1998 were well aware of the failings of both the SCPA (semiconductors) and AHRA (digital audio tapes), but still could not build a better system.