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5.11: U.S. Constitutional Protections that Foster Competition, Entrepreneurship, and Research

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    Figure 5.11.1

    To promote competition and entrepreneurship, the government has created agencies that support the individual inventor, bring governemntal inventions to the consumer, research medical issues and advances, and regulates the federal airwaves.


    Office of Patent and Trademark

    This office, a division of the U.S. Department of Commerce, was created as part of the Constitution, which states, "Congress shall have power . . . to promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries.”

    The United States Patent and Trademark Office (USPTO) is the federal agency for granting U.S. patents and registering trademarks. In doing this, the USPTO fulfills the mandate of Article I, Section 8, Clause 8, of the Constitution that the legislative branch "promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries." The USPTO registers trademarks based on the commerce clause of the Constitution (Article I, Section 8, Clause 3).

    By patenting an invention, the inventor then holds the license that allows manufacture, use, or sale of their invention. A patent is usually granted for 20 years. Although acquiring a patent may be an expensive and daunting process, the inventor’s intellectual property, or idea, if registered through this office is protected under governmental policies. The patent office also maintains a list of patents that may be searched.

    Types of Patents

    Patents may be granted for three types of inventions: utility, design, or plant.

    Utility - invention or discovery of a new and useful process, machine, article of manufacture, or composition of matter, or any new and useful improvement;

    Design - the invention of a new, original, and ornamental design for an article of manufacture;

    Plant - may be granted to anyone who invents or discovers and asexually reproduces any distinct and new variety of plant.

    Under this system of protection, American industry has flourished. New products have been invented, new uses for old ones discovered, and employment opportunities created for millions of Americans. The strength and vitality of the U.S. economy depend directly on effective mechanisms that protect new ideas and investments in innovation and creativity.

    Figure 5.11.2: A trademark is a symbol, word, or words legally registered or established by use as representing a company or product.


    A trademark is a word, name, symbol, or device used in manufacturing or creating a product that a consumer recognizes. Trademarks are granted on form and style, not the actual idea. For example, many companies create an orange drink, but Fanta has the trademark on their orange drink.

    Take the 2018 trademark infringement case of the Texas travel-stop Buc-ee’s. Buc-ee’s logo is a bright yellow circle with a smiling beaver sporting a ballcap. Recently Buc-ee’s sued Choke Canyon travel-stops because they claimed the Choke Canyon logo was too similar to Buc-ee’s, and it was intended to confuse the consumer. Choke Canyon’s logo of a yellow circle and a smiling alligator wearing a cowboy hat has the company name clearly displayed in the circle.

    The federal court ruled that the Buc-ee’s logo was trademark and the store's intellectual property was being copied.

    A trademark often becomes inseparable from the product that it represents. Think Coke or McDonalds.

    Figure 5.11.3: The Copyright Symbol


    Copyright is a form of protection provided by the laws of the United States to the authors of “original works of authorship” that are fixed in a tangible form of expression. An original work of authorship is a work that is independently created by a human author and possesses at least some minimal degree of creativity. A work is “fixed” when it is captured (either by or under the authority of an author) in a sufficiently permanent medium such that the work can be perceived, reproduced, or communicated for more than a short time. Copyright protection in the United States exists automatically from the moment the original work of authorship is fixed.

    According to "Copyright Basics", a circular from the United States Copyright Office, examples of copyrightable works include:

    • Literary works
    • Musical works, including any accompanying words
    • Dramatic works, including any accompanying music
    • Pantomimes and choreographic works
    • Pictorials, graphics, and sculptural works
    • Motion pictures and other audiovisual works
    • Sound recordings, which are works that result from the fixation of a series of musical, spoken, or other sounds
    • Architectural works

    With a copyright, the owner has all say in how, when, and where to sell, display, or reproduce their work. As with the trademark, the copyright guards the form, not the idea. For example, there are many songs about “love.” Many may about write this idea, but only John Legend may legally produce, sell, or perform “All of Me”.

    What Are the Rights of a Copyright Owner?

    Copyright provides the owner of copyright with the exclusive right to:

    • Reproduce the work in copies or phonorecords
    • Prepare derivative works based upon the work
    • Distribute copies or phonorecords of the work to the public by sale or other transfer of ownership or by rental, lease, or lending
    • Perform the work publicly if it is a literary, musical, dramatic, or choreographic work; a pantomime; or a motion picture or other audiovisual work
    • Display the work publicly if it is a literary, musical, dramatic, or choreographic work; a pantomime; or a pictorial, graphic, or sculptural work. This right also applies to the individual images of a motion picture or other audiovisual work.

    Who Can Claim Copyright?

    The copyright in a work initially belongs to the author(s) who created that work. When two or more authors create a single work with the intent of merging their contributions into inseparable or interdependent parts of a unitary whole, the authors are considered joint authors and have an indivisible interest in the work as a whole. By contrast, if multiple authors contribute to a collective work, each Copyright Basics 3 author’s individual contribution is separate and distinct from the copyright ownership in the collective work as a whole.

    “Works made for hire” are an important exception to the general rule for claiming copyright. When a work is made for hire, the author is not the individual who actually created the work. Instead, the party that hired the individual is considered the author and the copyright owner of the work. Whether a work is made for hire is determined by the facts that exist at the time the work is created.

    There are two situations in which a work may be made for hire:

    1. When the work is created by an employee as part of the employee’s regular duties, or
    2. When an individual and the hiring party enter into an express written agreement that the work is to be considered a “work made for hire” and the work is specially ordered or commissioned for use.

    How Long Does Copyright Last?

    In general, for works created on or after January 1, 1978, the term of copyright is the life of the author plus 70 years after the author’s death. If the work is a joint work with multiple authors, the term lasts for 70 years after the last surviving author’s death. For works made for hire and anonymous or pseudonymous works, the duration of copyright is 95 years from publication or 120 years from creation, whichever is shorter.


    According to the United States Patent Office and Trademark website, their resources also include The Scientific and Technical Information Center of the United States Patent and Trademark Office where, “available for public use over 120,000 volumes of scientific and technical books in various languages, about 90,000 bound volumes of periodicals devoted to science and technology, the official journals of 77 foreign patent organizations, and over 40 million foreign patents on paper, microfilm, microfiche, and CD-ROM.”

    National Science Foundation

    The National Science Foundation (NSF) is an independent federal agency created by Congress in 1950 "to promote the progress of science; to advance the national health, prosperity, and welfare; to secure the national defense..." NSF is vital because we support basic research and people to create knowledge that transforms the future. This type of support:

    • Is a primary driver of the U.S. economy.
    • Enhances the nation's security.
    • Advances knowledge to sustain global leadership.

    With an annual budget of $8.1 billion (FY 2019), we are the funding source for approximately 24 percent of all federally supported basic research conducted by America's colleges and universities. In many fields such as mathematics, computer science, and the social sciences, NSF is the major source of federal backing.

    According to the National Science Foundation website, “Unlike many other federal agencies, NSF does not hire researchers or directly operate our own laboratories or similar facilities. Instead, we support scientists, engineers, and educators directly through their own home institutions (typically universities and colleges). Similarly, we fund facilities and equipment such as telescopes, through cooperative agreements with research consortia that have competed successfully for limited-term management contracts.”

    This government-assisted research has also improved consumer products and communication technology. The largest contribution to governmental research comes from NASA.

    Figure 5.11.4: NASA churns out new inventions that help society.

    Important NASA Contributions

    Beginning in the last half of the 20th century and continuing today, the research and exploration efforts of NASA have contributed to the discovery and development of many important technological innovations. These contributions fall into many categories including Health and Medicine, Transportation, Public Safety, Consumer, Home, and Recreation, Environmental and Agricultural Resources, Pollution Remediation, Software, and Industrial Productivity. Since 1976, the annual NASA publication, “Spinoff”, has detailed the influence and impact on society of agency activities.

    Some examples of these products include the LED, artificial limbs, radial tires firefighter gear, portable cordless vacuum, freeze-dried food, etc. The list goes on and on.

    More information on this topic may be found in Section 4.5 and in the links below.

    For more information on NASA’s technological contributions, check out the following resources:

    The National Institute of Health

    The National Institutes of Health (NIH), a part of the U.S. Department of Health and Human Services, is the nation’s medical research agency where important discoveries are made to improve health and to save lives.

    The Marine Hospital Service (MHS) was established in 1798 to give medical care to merchant seamen. The job grew as Congress recognize an avenue to prevent epidemics by requiring the MHS doctors to inspect arriving ships for signs of infectious disease. This organization slowly turned in to the NIH.

    Charged with the purpose of serving the public’s health, the NIH began as a one-room laboratory y in 1887. Within month’s the NIH’s main doctor was making discoveries regarding bacteria and germs. The progress continues with over 80 Nobel prizes awarded to NIH sponsored research. Advances in genetics, cancer research, aging, heart attack, strokes, and preventive programs have all been made.

    The National Institute of Health was not created or structured by the constitution as there is not an explicit right to health care. However, the Supreme Court has ruled that the government should provide healthcare in certain situations, such as prisoners.

    Congress has enacted programs like Medicare, Medicaid, and Children’s Health Insurance Program which all establish government-funded health care programs. Most of these statutes have been enacted due to Congress’s authority to “make all Laws which shall be necessary and proper” to carry out its mandate “to … provide for the … general Welfare.” (Source: Health Care: Constitutional Rights Legislative Powers)


    The advancement made in communication has reached into all aspects of our lives. This includes not only the way that information is spread, but also the way politicians communicate with the public. Social media has been standard practice for the last two presidents, Obama and Trump. They regularly took to Twitter to voice their opinion or update the public.

    Instant communication technology has required new policymaking in order to supervise it. Agencies such as the Federal Communications Commission and the Federal Trade Commission oversee regulations to protect American citizens.

    Based on the information provided by the Federal Trade Commission, the FCC and the FTC will work jointly to protect consumers from internet scammers and internet deceptive trade practices.

    • The FCC will review informal complaints concerning the compliance of Internet service providers (ISPs) with the disclosure obligations set forth in the new transparency rule. Those obligations include publicly providing information concerning an ISP’s practices with respect to blocking, throttling, paid prioritization, and congestion management. Should an ISP fail to make the required disclosures—either in whole or in part—the FCC will take enforcement action.
    • The FTC will investigate and take enforcement action as appropriate against ISPs concerning the accuracy of those disclosures, as well as other deceptive or unfair acts or practices involving their broadband services.
    • The FCC and the FTC will broadly share legal and technical expertise, including the secure sharing of informal complaints regarding the subject matter of the Restoring Internet Freedom Order. The two agencies also will collaborate on consumer and industry outreach and education.

    Federal Communications Commission (FCC)

    The FCC is an independent agency of the United States government, created by Congressional statute (see 47 U.S.C. § 151 and 47 U.S.C. § 154) to regulate interstate communications by radio, television, wire, satellite, and cable in all 50 states, the District of Columbia and U.S. territories. The FCC works towards six goals in the areas of broadband, competition, the spectrum, the media, public safety, and homeland security. The Commission is also in the process of modernizing itself.

    The FCC was formed by the Communications Act of 1934 to replace the radio regulation functions of the Federal Radio Commission. The FCC took over wire communication regulation from the Interstate Commerce Commission. The FCC's mandated authority covers the 50 states, the District of Columbia, and U.S. possessions. The FCC also provides varied degrees of cooperation, oversight, and leadership for similar communications bodies in other countries of North America.


    The FCC's mission, specified in Section One of the Communications Act of 1934 and amended by the Telecommunications Act of 1996 (amendment to 47 U.S.C. §151) is to "make available so far as possible, to all the people of the United States, without discrimination on the basis of race, color, religion, national origin, or sex, rapid, efficient, Nation-wide, and world-wide wire and radio communication services with adequate facilities at reasonable charges."

    The Act also provides that the FCC was created "for the national defense" and "for the purpose of promoting safety of life and property through the use of wire and radio communications."

    What does the FCC do?

    • The FCC has been charged with several tasks related to the communications infrastructure of the United States. These include:
    • Promoting competition, innovation, and investment in broadband services and facilities
    • Supporting the nation's economy by ensuring an appropriate competitive framework for the unfolding of the communications revolution
    • Encouraging the highest and best use of spectrum domestically and internationally
    • Revising media regulations so that new technologies flourish alongside diversity and localism
    • Providing leadership in strengthening the defense of the nation's communications infrastructure

    More information on the FCC may be found at Section 4.5 of this text.

    Federal Trade Commission (FTC)

    As a consumer or businessperson, you may be more familiar with the work of the Federal Trade Commission than you think. The FTC deals with issues that touch the economic life of every American.

    The FTC is the only federal agency with both consumer protection and competition jurisdiction in broad sectors of the economy. The FTC pursues vigorous and effective law enforcement; advances consumers’ interests by sharing its expertise with federal and state legislatures and U.S. and international government agencies; develops policy and research tools through hearings, workshops, and conferences; and creates practical and plain-language educational programs for consumers and businesses in a global marketplace with constantly changing technologies.

    Figure 5.11.5

    Study/Discussion Questions

    1. Name three agencies the government has created to fostered competition and entrepreneurship.

    2. What is a patent? How does the patent process work? How can a patent protect an inventor?

    3. What is a trademark? Name a trademark that is familiar to you.

    4. What is copyright? What is the benefit to copyrighting your written work?

    5. List 5 important contributions that arose from NASA experimentation.

    6. Why is the National Institute of Health important?

    7. What is the function of the FCC?

    8. What is the function of the FTC?


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