Saturday, February 01, 2014

European Union Lawmaking: How Codecision Works in the EU (Video and Links, EU Glossary Definition)

Take a look at this EuropalTV video and links
explaining how lawmaking in the European Union works
by a process of what is called "codecision":

EU Codecision: How it Works.

The EU Glossary describes the Codecision procedure as follows:
"Codecision procedure

Following the entry into force of the Treaty of Lisbon, the codecision procedure becomes the ordinary legislative procedure of the European Union (EU) (Article 294 of the Treaty on the Functioning of the EU).

This procedure gives the European Parliament, representing the Union’s citizens, the power to adopt instruments jointly with the Council of the European Union. It becomes co-legislator, on an equal footing with the Council, except in the cases provided for in the Treaties where the procedures regarding consultation and approval apply. The ordinary legislative procedure also includes qualified majority voting in the Council.

Furthermore, the Treaty of Lisbon increases the areas within which the codecision procedure shall apply, therefore contributing towards strengthening the powers of the European Parliament.

The procedure comprises one, two or three readings. It has the effect of increasing contacts between the Parliament and the Council, the co-legislators, and with the European Commission."

U.S. Patent Law and its Administration by the USPTO: Stuart Graham and Saurabh Vishnubhakat pro and Shawn P. Miller and Alexander Tabarrok con

U.S. patent laws
USPTO administration of those laws
-- two different pairs of shoes?

See Econ Journal Watch and Shawn P. Miller and Alexander Tabarrok's article:
Ill-Conceived, Even If Competently Administered: Software Patents, Litigation, and Innovation—A Comment on Graham and Vishnubhakat.

Stuart Graham and Saurabh Vishnubhakat ("GV") are both Expert Advisors at the USPTO and defend the family store, warding off all responsibility from the back of the USPTO for the patent chaos, in their article, Of Smart Phone Wars and Software Patents, in the Journal of Economic Perspectives, Vol. 27 No. 1, 2013, arguing, according to Miller and Tabarrok, "that the emergence of the “smart phone wars” and the rash of recent lawsuits over software patents are not evidence that the patent system is broken."

Shawn P. Miller (Olin-Searle Fellow at Stanford Law School) and Alexander Tabarrok (Professor and Bartley J. Madden Chair in Economics at the Mercatus Center, George Mason University) conclude -- somewhat blandly -- in their article:
"GV’s evidence related to PTO examination supports the idea that, over the decade 2003 to 2012, examiners have taken the law as given and applied similar levels of scrutiny to software and non-software patent applications. Their evidence is also consistent with the more fundamental argument that the legal standards for defining software patent boundaries have been weak. We remain convinced that software patents continue to generate greater social costs than other patents.

By calling attention to the apparent legal validity of some of the software patents involved in the smart phone wars, Graham and Vishnubhakat remind critics of software patents that the fundamental issue is not PTO error. But we disagree with GV’s conclusion that absence of error is proof of utility. Rather, we join others in arguing that Congress and the courts must rein in the patent system with stricter interpretations of patent boundaries to reduce patents of overbroad and uncertain scope."
We agree ONLY with the last two sentences above, but remain strongly unconvinced that the USPTO performance under U.S. patent laws is acceptable by any stretch of the imagination.

Many too many overly broad patents have been issued, the issuance of which has been discretionary with the USPTO.

Grading USPTO performance by how the courts have handled subsequently litigated patent cases -- the test applied by GV -- is a cinch for the family store USPTO since patents are presumed to be valid from the very beginning of litigation. Opposing lawyers must move mountains to get a patent limited or invalidated.

Indeed, except in the most outrageous cases, lower court judges are not going to put their careers on the line by second-guessing the USPTO on patents, and even if they do, the pro-patent Federal Circuit is likely to overrule them. That is no valid standard of USPTO performance.

The attempt of the USPTO to escape responsibility for the current patent chaos fails. In those same litigated cases, had NO patent ever been granted in the first place, the deference given to the USPTO by the courts would have given the same "research" result as GV found, i.e. the USPTO winning.

We have already cited enough examples of wrongly granted patents in previous LawPundit postings so we will not go into that here.

In our opinion, many patent applications often involve NO invention per se that has been made, but merely some -- often obvious -- application of the state of the art, as anticipated by prior art, to some other object of the state of the art.

The USPTO could probably deny 90% of all patent applications and the courts would uphold them in the vast majority of cases. That is no standard of how the USPTO is doing its job. 

Sorry. Back to the drawing board. The correct STANDARD OF PERFORMANCE is the existing patent mess and soaring litigation numbers as regards overly broad patents granted by the USPTO. THAT is the correct standard.

Cash Flow, Profits and Off-Balance-Sheet Financing (or) How Much Money is a Company Like Amazon REALLY Making?

Matthew Yglesias has an article on Slate titled
The Prophet of No Profit: How Jeff Bezos won the faith of Wall Street.

We are fans of Amazon because of its low prices and quick delivery, but we think it possible that the most popular comment to that posting, by Benton Love, might be somewhat closer to the actual financial corporate reality, as Love emphasizes cash flow and not other accounting parameters, writing inter alia:
"It's important to remember that "profits" are an accounting construct that don't necessarily match how much money a firm is making.... [Amazon]'s asset base produced $5.4 billion more cash than was put into it. One reason why its earnings didn't look so hot is that they had a depreciation "expense" of $3.2 billion, which is an imaginary non-cash expense."
Indeed, one of the major problems of fair and adequate corporate taxation by governments and hence adequate government revenue is that actual corporate profits can be (and often are) much greater than those "officially" and "legally" reported, because of accepted and "legal" accounting practices that essentially permit profits to be "parked" or "deferred".

As one can read at, one example is "Off-Balance-Sheet Financing" -- e.g. pension plans, where earnings could "theoretically" be "parked" in capital expenditures covering pension plan liability, as a means to avoid being declared as profits and being subject to taxation, etc.

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