Tag Archives: IP Commission

Up to $600 billion in U.S. IP is stolen annually by foreigners, says report

An IP Commission study finds that foreign sources, especially China, are responsible for the bulk U.S. theft.

Counterfeit goods, pirated software, and theft of trade secrets together represent a “systematic threat” to the US economy of between $225 billion and $600 billion annually, according to the findings of a 2017 research report from the bi-partisan IP Commission, The Theft of American Intellectual Property: Reassessments of the Challenge and United States Policy.

The massive theft of American IP—from companies and universities across the country, from U.S. labs to defense contractors, from banks to software companies—threatens the nation’s security, says the report.

The research, and update of a 2013 report, is the work of the bi-partisan IP Commission and was published by the National Bureau of Asian Research (NBR) NBR conducts advanced independent research on strategic, political, economic and other issues affecting U.S. relations with Asia, including China and Russia.

The Intangible Investor in June’s IAM features a full perspective on the report, “Foreign sources responsible for most IP theft.” Subscribers can find a copy here.

Pioneering Research

Kudos to the IP Commission for establishing a beachhead in the global war to combat IP theft and cyber crime. Its pioneering research provides American and other lawmakers, businesses, investors and the public, with data about IP infringement that are cannot be ignored.

However, the report falls short. Identifying and stopping infringement, including cyber-espionage, should not be restricted to sources outside of the U.S.  The IP Commission’s research zeros in on foreign counterfeit, trade secret and copyright violations. It does not account for increasing domestic patent infringement and copyright abuses, which have profoundly affected the software, recording and other industries, and impacted U.S. jobs.

To be fair, this IP Commission’s focus is foreign IP threats, and it is a daunting task to estimate the financial impact of domestic invention theft on U.S. businesses – not just what gets reported in the press about settlements and licenses.

But speaking to a range of IP attorneys and holders, it becomes clear that much IP abuse comes from domestic IT businesses, Internet providers, streaming services, individuals and others that know they are unlikely to be caught infringing rights or will have to pay for a license. By the IP Commissions own admission, IP theft is less benign than it might appear.

The theft of American IP is not just the ‘greatest transfer of wealth in human history,’ as General Keith Alexander put it; IP theft undercuts the primary competitive advantage of American business—the capacity for innovation.

Inspiration and a Challenge

The IP Commission’s timely report is a challenge to IP holders, and lawmakers alike who are concerned about innovation and commerce. It is a call to examine the source, type, and level of domestic IP rights theft, including patents, on SMEs, inventors, and universities, and how they affect the economy now and are likely to in the future.

The full 24-page update, The Theft of American Intellectual Property: Reassessments of the Challenge of the United States Policy, is well worth reading. Visit  www.ipcommission.org.

The original 2013 report, Report of the Commission on the Theft of American Intellectual Property, is also available and useful for comparison. 

Image source: ipcommission.org; linkedin.com

U.S. IP Commission Explores Foreign Theft; Ignores Domestic

The pain inflicted by U.S. companies on other American businesses and the economy from domestic IP theft receives scant attention in a timely recent study.

The Commission on the Theft of American Intellectual Property (the IP Commission), an independent, bi-partisan initiative of leading Americans from the private sector, public service in national security and foreign affairs, academe, and politics, has issued a report and recommendations on IP theft that attempts to address a global problem while ignoring its deep local roots.

A beam of much needed light on a sea of anti-patent, anti-IP monetization proposals circulating in Washington, the IP Commission’s findings are too important not to take seriously and its recommendations too brave to ignore. However, the Commission cannot be let off for what it fails to consider: The damage that domestic IP theft inflicts on the US economy.

In DC Watchdog Gets Serious About Foreign Theft of U.S. IP, in the September Intangible Investor in IAM, out next week, I look at aspects of the IP Commission report which is long on vision but short on how IP crimes originate and what can be done to stem their tide at home. (The IAM Blog had strong reservations about the report, suggesting in a post that it confused IP theft with a lack of strategy.)   

Co-Chaired by Gov. Jon Huntsman (Utah, former Ambassador to China) and Hon. Dennis Blair (Admiral, US Navy, retired; former Director of National Intelligence), the IP Commission concludes that U.S. IP, including content, branded goods and inventions, are under siege by foreign businesses and governments, and dramatic measures need to1-7f58ea3fa3 be implemented now or halt the loss of valuable ground in the innovation battle.

In late May the IP Commission released its findings, which include losses of hundreds of billions of dollars per year in revenue and millions of jobs, as well as a drag on US GDP growth and innovation incentive.

The report states that international IP theft is not just a problem in China, where it is rampant, but Russia, India, and other countries constitute important actors in this worldwide challenge as well. Many issues are the same: poor legal environments for IPR, protectionist industrial policies, and a sense that IP theft is justified by a playing field that benefits developed countries.

*****

IP theft is not only a problem emanating from foreign businesses and governments, like China. It is domestic threat that the courts and the patent system seem ill-equipped to address.

Let’s hope that the U.S. can rise to the challenge and recognize that systematic IP theft is an economic catastrophe in the making, and that it needs to be taken as seriously whether it originates abroad or at home.

Illustration source: http://www.ipcommission.org


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