Investor's Business Daily, August 1st, 2007
In the coming days, the White House has an excellent opportunity to deliver an unambiguous message to our global trading partners: Intellectual property rights must be taken seriously all the time -- not just some of the time and not just for a select few.
This is a critical message in a world where U.S. companies in technology, pharmaceuticals and other sectors face daily encroachment on the intellectual property they have invested billions to develop.
This opportunity arises from the White House's Monday deadline for deciding whether it will veto a ruling by the U.S. International Trade Commission.
On June 7, the ITC ruled that Qualcomm infringed on Broadcom's valid patent on a chip technology used in cell phones.
As a compromise remedy, the ITC adopted a ban on the importation of new cell phone models using the infringing chip, but allowed current models using these chips to continue to be imported and sold in the U.S.
The ITC ruling should have been Qualcomm's cue to open negotiations and secure a license for the infringed patent.
Instead of reaching a market-based solution, the company executed an aggressive lobbying campaign designed to shift the focus away from its patent infringement and toward an array of distracting assertions, hoping that the White House, which has not overturned an International Trade Commission ruling in 20 years, could be swayed.
Past and present administrations have treaded cautiously in this area for good reason. Making exceptions -- even those that may be well intended -- only hands the foes of strong intellectual property rights a weapon to resist calls for enforcement.
They would be quick to cite the veto as evidence that the U.S. is not immune from the politics of intellectual property.
Rejection of the ITC remedy would likely be greeted warmly in some economies where such an untethered "public interest" standard could be emulated and employed as a tool to achieve short-term political and economic goals.
These reactions, and any policies they lead to, would be shortsighted, particularly in emerging economies that are quickly moving up the technology curve.
Weakening intellectual property rights hurts any company that puts innovation at the heart of its growth strategy -- whether the company is in Menlo Park or Mumbai.
It also hurts consumers, who are the ultimate beneficiaries of the competition and innovation that intellectual property protection fosters.
Rather than setting precedents for weakening intellectual property rights, White House leadership should demonstrate to the world how to protect intellectual property, which spurs development and improves the quality of life for people.
For these reasons, the decision on the ITC ruling will have an impact far beyond the commercial interests of Broadcom or Qualcomm.
The White House would do consumers, companies, inventors and the world economy a good turn by letting the ITC ruling stand.
A decision not to intervene in this case would show that the rule of law is the standard by which our judgments are made and that we practice what we preach when it comes to intellectual property.
This is an opportunity for the White House to underscore the fact that one of the foundations of our economy is intellectual property rights.
It would also prod companies to the negotiating table to come up with market-based solutions that keep government out of what should be commercial decisions. This is precisely what happened last week when Verizon Wireless reached an agreement with Broadcom that exempts its cell phones from the ITC remedy.
A decision to let the ITC ruling stand would be a win-win for the administration: It would strengthen our credibility on intellectual property rights with our trading partners and allow for a market-based solution to a commercial dispute, both sensible ways to encourage innovation, investment and global growth.
Stern is chairwoman of The Stern Group Inc. and former chairwoman of the U.S. International Trade Commission. She testified before the ITC on behalf of Broadcom. Goldberg is a policy specialist and co-founder of the Center for Medicine in the Public Interest.
