In some countries, commercial piracy has become the de facto national industrial strategy!
Pirates can prevent a company from recouping its research and development investment, thus killing a small firm. For example, in 1970, Stanford Ovshinsky, head of a small high-tech company, obtained patents on a process that showed promise in upping computer memory storage. His firms RD created the process.
Then, in 1983, a giant Japanese firm boldly announced at a New York press conference that it had discovered the same process. Ovshinsky, enraged, testified that his patented process was well-publicized in Scientific American, a National Academy of Sciences report, and his own lectures. Ovshinsky claimed he had made trips to Japan and held technical discussions with that Japanese company in the mid-1970s regarding a licensing arrangement for his process. Thus, when the Japanese company made its announce-ment 13 years later, Ovshinsky remarked, It was just incredible, in fact, unbelievable to me...because of the arrogance.
Ovshinsky and his company had no choice. We had to sue, he said, The appropriation of property is theft. Ovshinsky believed the Japanese companys plan was to tie him up in litigation until his patents expired, then to flood the market with their pirated product. Because his firm was relatively small, the litigation cost would siphon funds needed for RD of new technologiesthe essence of his enterprises survival. Without punishment, Ovshinsky explained, this practice would continue against small American high-tech concerns.
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