You Should Get A License For That

Wyche Inside IP
By Meliah Bowers Jefferson

CEO Elon Musk, recently created a lot of media attention for his company Tesla Motors, when he announced that the company was giving away free access to the company’s patented technology.  In a blog post on Tesla’s website, Musk proclaimed: “in the spirit of the open source movement, for the advancement of electric vehicle technology . . . Tesla will not initiate patent lawsuits against anyone who, in good faith, wants to use our technology.”

Tesla’s announcement will likely have significant advantages for the company.  Musk and Tesla have received bountiful praise for taking this bold step toward open source patent use, particularly as certain types of patent litigation draws more scrutiny.  And by most industry accounts, this was definitely a move in the right direction for the next generation of Tesla’s technology and the innovation of electric cars.  Tesla is investing its patents in creating a supply of electric cars that will be dependent on an energy source primarily, if not solely, available through Tesla.  Tesla knows that everyone may not drive one of its cars yet the company is definitely hoping this latest maneuver will result in everyone using Tesla technology.  That would be a big win for Tesla.

But did Elon Musk and Tesla do anything new, creative, or cutting edge in making their latest announcement?  Not really.  This type of open source use of patents is prevalent in the world of computer software.  Linux software, which is shared through a type of general public license, likely is one of the most well-known open source software development uses.  It marks the beginning of the Android platform for mobile devices, is the preferred platform for recent movies your children love, and many other features of computer technology at your fingertips each day.  More interestingly, a similar open source development model has been used in the automotive industry. In the early twentieth century, the Automobile Board of Trade (later known as the Motor Vehicle Manufacturers Association) consisting of all automobile manufacturers in the United States, entered into a cross-licensing, royalty-free agreement allowing any member company to use the patents controlled by any other member. This early use of the open source model improved the quality and quantity of cars built by American manufacturers, and may be responsible for building the city of Detroit.

I am anxious to see what the future holds for Tesla Motors and the users of its technology.  I hope that we see meaningful evolution in electric car development.  But, for anyone planning to use Tesla’s patents – you should definitely get a license.  The open source development model best serves its purpose when simple, clear, but liberal licensing is in place.  Before using other’s intellectual property, you must understand their rights and protect your rights.  Relying on undefined permission from Tesla based on its determination of “good faith” is not good business.

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Meliah Jefferson

Meliah works primarily in the area of trial and appellate litigation, with an emphasis on complex civil litigation and intellectual property law. Her varied experience includes representing plaintiffs and defendants in cases involving corporate governance, commercial law, election law, governmental authority, and disputes over intellectual property — such as trademark, copyright, patents, and trade secrets.

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