Posted by: cjenscook | 04/18/2009

Public and Private – and a new look at Intellectual Property

Public/Private is an artificial “either/or” distinction of absolutes.

What we mean by them is either

(a) Public as “owned by the State” – the State being a set of linked protocols eg constitutions, whether national or local, and a heap of statutes; or

(b) Private as “owned by a legal person” – being either an individual or – more to the point – the sociopathic (at least in its public, ‘absentee landlord’ form) legal protocol known as the Corporation.

The legal frameworks within which the property rights of ownership and use take place are ‘one way’ contracts imposed either through statute or through judge-made trust law.

I am observing the emergence of new consensual (ie two way) protocols using entities such as the US LLC and the UK LLP, which owe their origins to partnership law. These entities may be used not just as organisations but as pure Open Corporate frameworks for self organisation. An open corporate (an LLC is not technically a corporate because it has a ‘sell by’ date, but it’s close enough ) need not do anything, own anything, employ anyone or contract with anyone.

Instead it serves as a framework for the various stakeholders to come together to achieve the common purpose set out in the LLP/LLC agreement, whether it is to write a piece of software, or build and manage houses and wind turbines.

I believe that there is an alternative enterprise model to the unsatisfactory absolutes of Copyright/ Copyleft and the bastardised hybrids of Creative Commons as currently written and which sit extremely uncomfortably within the existing enterprise model. This is a Master Partnership framework agreement whereby the IP is held by a “Custodian”, and the User member pays an agreed amount (which may be zero) for the use of the IP, and of whatever platform is used to disseminate it.

This amount is shared in agreed proportions between the loose networked cooperative of individuals – whether as individuals or collective “enterprises” in whatever legal form – who operate the platform (which operation includes managing development, and things like dispute resolution, and valuation) – and the cooperative of individuals and enterprises who invest either money, or more likely “money’s worth” of IP.

I believe that such a Partnership of Partnerships or Cooperative of Cooperatives may actually be optimal. It is emerging because it enables productive assets to be created and operated without paying returns to rentier financiers interested only in making money from money. As a side comment, this means that conventional ‘shareholder value’ Capital is simply inefficient. The Internet will route around it.

Such Master Partnerships will be an order of magnitude simpler (this is my experience of partnership protocols) because they are consensually arrived at, rather than being adversarially negotiated and therefore prescriptive.

In summary, therefore, I see the spread of networked “Virtual LLC’s” and Virtual LLPs as the future, as I said both here and as published by the Carnegie Institute

Peer to Peer Finance – a Flight to Simplicity

So Law is Code ….and the requirement is, I believe, for a form of legal XML which links together disparate jurisdictions and enterprises in the same way that XML links disparate hardware and software.

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Responses

  1. […] Systemation created an interesting post today on Public and Private – and a new look at Intellectual Property « Nordic…Here’s a short outlineLaw is Code ….and the requirement is, I believe, for a form of legal XML which links together disparate jurisdictions and enterprises in the same way that XML links disparate hardware and software. […]

  2. Dear Chris,

    I came across your blog after seeing a link that you had in a comment left on another blog. Your ideas are very interesting and thought provoking. I will be subscribing and letting others know.

    Great work!

    • Thanks, Jason. We live in interesting times….


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