Tracer Marks

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ARTICLE
TRACERMARKS:
A PROPOSED INFORMATION INTERVENTION
Margaret Chon
We can see now that information is what our world runs on:
the blood and the fuel, the vital principle.1
ABSTRACT
We live in a world of information. But paradoxically, we
simultaneously suffer from a scarcity of smart information:
information that is traceable and therefore reliable, trust-worthy,
and ultimately verifiable. Combining the insights of global
governance theory with behavioral economics, this Article
approaches this challenge from a knowledge governance
framework, sets forth various reasons for this unnecessary deficit,
and proposes an intervention to address ittracermarks.
Envisioned as a hybrid of trademarks and certifications marks,
tracermarks would encourage various stakeholders to disclose,
Donald and Lynda Horowitz Professor for the Pursuit of Justice, Seattle
University School of Law. This Article was prepared for presentation at IPILs 2015
National Conference in Santa Fe, New Mexico, and in part for an opening address at the
New Zealand Center for International Economic Law conference held at Victoria University
at Wellington. The Author thanks IPIL, Professor Greg R. Vetter of the University of
Houston Law Center, and the Presenters and Fellows in Santa Fe, for their many helpful
comments and suggestions. In addition, she would like to acknowledge the support of
research librarian Kerry Fitz-Gerald, Elizabeth OBrien (class of 2015), Maria Therese
Fujiye (class of 2016), and Stephanie Gambino (class of 2017). Numerous colleagues and
friends provided helpful feedback on various draft versions, especially Jhonny Pabon
Cadavid and Professors H. Toms Gmez-Arostegui and Dev Gangjee. For all of the above,
the Author expresses her sincere gratitude.
1.
JAMES GLEICK, THE INFORMATION: A HISTORY, A THEORY, A FLOOD 8 (2011).
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disseminate, and ultimately make decisions about previously

hidden qualities of specific goods and services throughout global
value networks. Digital networks have tremendous potential to
combine with other kinds of technologies (for example, QR or UPC
codes, smart phone apps, and other intermediaries and platforms),
and thus to contribute to the production and distribution of smart
information about specific goods and services. Improving the
capacity for meaningful consumer and producer choices through
smart information would also increase net social welfare through
innovation, which is a primary public policy goal of intellectual
property.
TABLE OF CONTENTS
I. INTRODUCTION: AN ECONOMY OF SCARCITY OF
SMART INFORMATION ............................................................ 102
II. NOBODYS PERFECT: ECONOMIC CAN-OPENERS OF
INTELLECTUAL PROPERTY .................................................... 106
III. BUYER BEWARE: TRUST MECHANISMS OF GLOBAL
VALUE NETWORKS ................................................................ 111
IV. COGNITIVE CAPITALISM: INTELLECTUAL PROPERTY
IN GLOBAL VALUE NETWORKS .............................................. 114
V. KNOWLEDGE GOVERNANCE: SOME LEGAL HACKS ............... 120
VI. TRACERMARKS: A PROPOSED INFORMATION
INTERVENTION ...................................................................... 125
VII.CONCLUSION: INFORMATIONFROM
DUMB TO SMARTER? .............................................................. 137
I. INTRODUCTION: AN ECONOMY OF SCARCITY OF SMART
INFORMATION
This Article explores the consequences of several paradoxes of
intellectual property (IP). Its primary normative claim is that
increasing the traceability and transparency of more objectively
verifiable information will greatly benefit consumers, producers,
and other stakeholders involved in global transactions involving
IP-protected goods and servicesthus promoting global social
welfare. Its primary goal is to explain why policymakers should
move the needle from the frequent default position of nonverifiable
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information towards more consistent creation and distribution of

what this Article terms smart informationthat is, traceable,
transparent, and verifiable information. And its primary new
suggestion (or legal hack) is a tool called a tracermark to assist in
this endeavor.
An initial paradox to consider is the increasingly obvious fault
line within IP. Distributed networked technologies such as the
Internet have created an economy of plenty in many sectorsas
opposed to the economy of artificial scarcity upon which IP is
typically posited.2 A second paradox is that what we consume
online often knows more about us than we know about it.3 Search
engines that we consume without payment are engaged in massive
data collection about our buying preferences.4 And the so-called
Internet of Things means that appliances connected to our bodies
and environments can supply information back to the network,
often without our knowledge much less consent.5 Yet consumers
barely know anything about where a products component parts
originated and under what conditions.6 Thus, despite the economy
of plenty of information, we are faced with an economy of scarcity
of certain kinds of information, manifested by a pervasive
information asymmetry. A third paradox examined here is that IP
law provides insufficient incentives to create and distribute
information that might address these informational asymmetries
and scarcities. Although incentivizing and supporting innovation
is often viewed as the primary if not sole mandate for IP, the
overall legal framework has not evolved much from its origins and
corresponding first principles to encourage innovation in the
provision of reliable information in a global information economy
where components are sourced in multiple jurisdictions. The
informational resource infrastructure and distance between
producer and consumer can be correspondingly immense.7
2.
Mark A. Lemley, IP in a World Without Scarcity, 90 N.Y.U. L. REV. 46668 (2015).
3.
I am indebted to Christine Farley for this apt observation.
4.
Katherine J. Strandburg, Free Fall: The Online Markets Consumer Preference
Disconnect, 2013 U. CHI. LEGAL F. 95, 99100.
5.
See Scott R. Peppet, Regulating the Internet of Things: First Steps Toward
Managing Discrimination, Privacy, Security, and Consent, 93 TEX. L. REV. 85, 99116
(2014) (discussing various technologies in the Internet of Things and the resulting problems
of lack of consumer privacy and consent).
6.
Stephanie Clifford, Some Retailers Reveal Where and How That T-Shirt Is Made,
N.Y. TIMES, May 9, 2013, at A1 (discussing growing consumer demand for information
concerning working conditions in the production of clothing).
7.
Julie E. Cohen, Property as Institutions for Resources: Lessons from and for IP,
94 TEX. L. REV. (forthcoming 2015), http://papers.ssrn.com/sol3/papers.cfm?ab
stract_id=2478051; see also BRETT FRISCHMANN, INFRASTRUCTURE: THE SOCIAL VALUE OF
SHARED RESOURCES 253 (2012).
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Taken together, these paradoxes have contributed to a

collective market failure, where many consumers who would
prefer to have smart information available typically have to make
do with little to none of itand where many producers who might
prefer to provide smart information are insufficiently incentivized
to do so. Consumer preferences for underlying qualities of products
and services are largely masked by the expression of consumer
preferences for trademarks and their associated branding.8 While
a trademark may function as an adequate proxy for a consumer
preference regarding a branding image, it is not a good proxy for
the brands invisible qualities. For example, if a consumer would
like to purchase a product such as a laptop that is certifiably
sweatshop-free, there is no easy mechanism for him or her to
ascertain from the trademark alone that the laptop is in fact free
from oppressive labor. This situation of information asymmetry is
arguably a violation of consumer civil rights,9 and it covers the full
gamut of products and services across multiple industry sectors.
If this Article is correct in claiming that increasingly invested
and interactive consumers demand smarter information, then the
challenge is how to offer it more consistently and reliably
throughout these global transnational networks. Importantly,
firms would also benefit from smarter information that, for
instance, would allow pricing of goods to accurately reflect specific
qualities of goods (such as sweatshop-free or other characteristics)
as distinguished from mere marketing claims. Enhancing markets
for smart information about IP-protected goods and services
inevitably will extend and improve markets for these goods and
services themselves. Smart information also has huge potential for
participation by the least empowered producers (factory workers,
for example) to contribute to the quality of overall information
provided about a good or service.
This Article relies heavily upon a framework of knowledge
governance to re-imagine IPs functions. The term governance
suggests the possibility of a regulatory apparatus with a broader
set of tools than the useful but ultimately limited incentives
provided by IP. Throughout this Article, this knowledge
governance approach relies on the insights of global governance
theorists.10 One of these insights is that regulation does not occur
8.
See Jon D. Hanson & Douglas A. Kysar, Taking Behavioralism Seriously: The
Problem of Market Manipulation, 74 N.Y.U. L. REV. 630, 747 (1999) (discussing the
influence that nonrational phenomena can have over decision-making).
9.
Douglas A. Kysar, Preferences for Processes: The Process/Product Distinction and
the Regulation of Consumer Choice, 118 HARV. L. REV. 525, 61017 (2004).
10.
See, e.g., Grinne de Brca, New Governance and Experimentalism: An
Introduction, 2010 WIS. L. REV. 227, 232 (discussing strategic uncertainty and
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solely through hierarchy (top down, command and control

government regulation), but also through means such as
information circulating through transnational networks.11
Another important global governance insight is that cross-border
transactions based upon this type of information are ideally
premised on reliable trust mechanisms.12 And global governance
includes a decided turn toward softer forms of regulationwhat
some have called bespoke IP13 and what will be occasionally
referred to throughout this Article as legal hacks. In this context
of knowledge governance, the default setting (dumb or smart
information) matters.14
Global governance scholarship also teaches us that a more
responsive interface between public and private regulatory
frameworks is critical to successful legal interventions in highly
dynamic situations, such as those involving rapid technological
change.15 This Article thus proposes a new IP legal innovation,
which is termed a tracermark. This type of mark is neither a
trademark nor a certification mark. It bears some characteristics
of both and would occupy the regulatory space between, taking
advantage of the current flexibilities within existing public law
frameworks. Tracermarks would enable the construction of
further platforms (such as possible Wiki-tracers) that in turn
would allow smart information about various goods and services
to be distributed widely. This Article envisions the emergence of
a knowledge governance mechanism consisting of platform
intermediaries combined with consumer and producer
interdependence as background conditions precipitating the rise of new governance
systems); Tim Bartley, Global Production and the Puzzle of Rules, in FRAMING THE GLOBAL:
ENTRY POINTS FOR RESEARCH 229, 22934 (Hilary E. Kahn ed., 2014) [hereinafter Bartley,
Puzzle of Rules] (reviewing global governance scholarship and positing that rule-making
activity proliferates national, intergovernmental, and transnational governance); Tim
Bartley, Transnational Governance As the Layering of Rules: Intersections of Public and
Private Standards, 12 THEORETICAL INQUIRIES L. 517, 52023 (2011) [hereinafter Bartley,
Layering of Rules] (urging global governance scholars to address the impact of
transnational private regulations vis--vis public, domestic regulations).
11.
Scott Burris, Peter Drahos & Clifford Shearing, Nodal Governance, 30 AUSTL. J.
LEGAL PHIL., 2005, at 30, 3640.
12.
See infra Part III.
13.
Cohen, supra note 7, at 4246.
14.
See RICHARD H. THALER & CASS R. SUNSTEIN, NUDGE: IMPROVING DECISIONS
ABOUT HEALTH, WEALTH, AND HAPPINESS 8387 (2008) (theorizing that selecting default
choices is preferable to eliminating difficult choices).
15.
See de Brca, supra note 10, at 232 (hypothesizing that strategic uncertainty and
interdependence create the need for new systems of governance); Charles F. Sabel &
Jonathan Zeitlin, Learning from Difference: The New Architecture of Experimentalist
Governance in the EU, 14 EUR. L.J. 271, 282, 28689, 307 (2008) (describing how public and
private entities work together in an institutional interface to solve issues caused by
overlapping regulatory frameworks and commercial demands in the electric power sector).
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crowd-sourcing, to create reliable databases of smart

information.
Part II of this Article analyzes briefly why the prevailing
economic narratives of intellectual property fail to address the
problem of lack of provision for smart information. Part III turns
to a subset of global governance literature, based upon transaction
costs economics, to identify important tools in providing smart
information within global value networks. Part IV discusses how
IP currently functions in global value networks. Part V surveys
specific examples of smart information currently existing in the
overall landscape in global knowledge governance. And Part VI
concludes with a proposal for a new regulatory tool: a tracermark.
The key to this proposal is identifying incentives for moving the
information about these global goods and services from
information for dummies to information for cosmopolitans in a
global marketplacethat is, from mere content to robust,
objectively verifiable knowledge.
II. NOBODYS PERFECT: ECONOMIC CAN-OPENERS OF
INTELLECTUAL PROPERTY
IP has been hampered by an incomplete theory of information.
It relies on several unexamined assumptions, explicitly or
implicitly based upon powerfully efficient models. These
assumptions should be familiar to anyone with a passing
familiarity with IP, deeply affected as it is by law and economics.
One assumption is that we live in a world of perfect
information with zero transaction costs.16 A second is that
information will be disclosed unless there is some sort of boundary
around it in the form of a legally enforceable exclusive right.17 IP
policy-makers often refer to this as the public goods problem,
based upon the assumption that information is too easily shared
and therefore overly appropriable without legal boundaries such
16.
This assumption is pervasive so that the joke about the economists can opener
told to me many years ago by my undergraduate economic professor is familiar still. See On
a Desert Island, with Soup, HARV. U. PRESS: BLOG (Apr. 6, 2012, 12:38 PM),
http://harvardpress.typepad.com/hup_publicity/2012/04/on-a-desert-island-with-soup-schl
efer-assumptions-economists-make.html.
17.
Of course, this premise is derived upon the famous Arrow paradox: [A]
fundamental paradox in the determination of demand for information [is that] its value for
the purchaser is not known until he has the information, but then he has in effect acquired
it without cost. Kenneth J. Arrow, Economic Welfare and the Allocation of Resources for
Invention, in NATL BUREAU OF ECON. RESEARCH, THE RATE AND DIRECTION OF INVENTIVE
ACTIVITY: ECONOMIC AND SOCIAL FACTORS 615 (1962), reprinted in KENNETH J. ARROW,
ESSAYS IN THE THEORY OF RISK-BEARING 152 (1974).
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as copyright and patents.18 The trademark version is that

producers require protection against the passing off of their
goods as someone elses, in the form of a legal boundary called a
trademark.19 Thus, the prevailing IP policy framework contends
that enforceable IP rights to exclude are essential to both prevent
free-riding and promote incentives for innovation.20 And a third
largely unexamined assumption is that once these legal
boundaries are set, consumers of IP-protected goods then act
rationally to maximize their self-interest upon the aforesaid
platform of perfect information.21
These three assumptions (that information is perfect, that it
is easily appropriable, and that consumers are rational actors
acting upon perfect information) have dominated IP theory, law,
and policy in the late twentieth century. Yet because these
assumptions are incomplete snippets of a larger, more complex
body of competing economic theories, they miss an enormous
amount of what IP needs to address in cross-border transactions.
For example, economists and others have demonstrated that
information is not perfectin fact, far from it. A market for
so-called lemons exists because consumers do not always have
access to information to make welfare-maximizing choices.22 Not
all qualities of a good are readily observable, and these types of
goods have come to be known as credence goods.23 Relatedly, a
product may not be subject to immediate evaluation by a buyer,
yet may be experienced after purchasethese are so-called
experience goods.24 Whether credence or experience goods, the
distance between buyers and sellers along global transactions also
contributes to the imperfect information environment in which
18.
David W. Barnes, Congestible Public Property and Impure Public Goods, 9 NW. J.
TECH. & INTELL. PROP. 533, 53640 (2011).
19.
Id. at 54142 ([S]imultaneous source-indicating use of a mark by a business
competitor would diminish the utility derived by the mark owner . . . .).
20.
David W. Barnes, The Incentives/Access Tradeoff, 9 NW. TECH. & INTELL. PROP.
96, 10910 (2010).
21.
See Daniel L. McFadden, The New Science of Pleasure 4 (Natl Bureau of Econ.
Research, Working Paper No. 18687, 2013), http://www.nber.org/papers/w18687
(describing the classical economic conception of decision-making as fundamentally static,
with the consumer making a once-and-for-all utility maximizing choice of market goods).
22.
George A. Akerlof, The Market for Lemons: Qualitative Uncertainty and the
Market Mechanism, 84 Q.J. ECON. 488, 489 (1970); Joseph E. Stiglitz, Information and the
Change in the Paradigm in Economics, Part 1, AM. ECONOMIST, Fall 2003, at 6, 1516.
23.
Ariel Katz, Beyond Search Costs: The Linguistic and Trust Functions of
Trademarks, 2010 BYU L. REV. 1555, 156263.
24.
Phillip Nelson, Information and Consumer Behavior, 78 J. POL. ECON. 311, 312
(1970) (distinguishing between search goods and experience goods with the examples of a
dress, which can be tried on immediately, versus a can of tuna fish, which has to be opened
in order for the fish to be evaluated).
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these types of goods are evaluated.25 Arguably, information about

attributes of credence or experience goods (credence attributes) is
smart information that consumers seek but often do not find about
their transactionsa type of informational market failure. For
example, agricultural economists have identified unmet consumer
demand for information about humane sourcing of beef products.26
Thus a new paradox is evident. In this era characterized by
plenty of online information, we are faced with a scarcity of
information about credence attributes. This scarcity manifests in
multiple ways. First, we experience a scarcity of information about
the underlying characteristics or processes of IP-protected
products, such as information about where components are
sourced, and the working conditions of those involved in
manufacture.27 Second, the scarcity is evident in the consumers
forced reliance on price or brands (and associated marketing) as
the primary indicia of the quality or other characteristics of these
IP-protected products.28 A third major type of scarcity is due to the
fact that consumers are usually isolated from the more detailed
information available to intermediate suppliers and wholesalers
who often monitor product quality via contractual and other
controls. On a related point, individual consumers lack the
leverage that large buyers such as Costco or Wal-Mart can wield
to compel production of such information from their suppliers.29
Taken together, these scarcities comprise significant
informational gaps.
For a large swathe of goods and services, consumers currently
are faced with the choice of either uncertain loyalty toward a
particular products claims, or exit via non-purchase or boycott.
There are no consistently meaningful avenues to voice demands
25.
Sulin Ba, Andrew Whinston & Hang Zhang, Building Trust in the Electronic
Market Through an Economic Incentive Mechanism, 1999 ICIS PROC. 208, 20809,
http://aisel.aisnet.org/cgi/viewcontent.cgi?article=1098&context=icis1999.
26.
Nicole J. Olynk, Christopher A. Wolf & Glynn T. Tonsor, Labeling of Credence
Attributes in Livestock Production: Verifying Attributes Which Are More than Meet the
Eye, 5 J. FOOD L. & POLY 181, 187 (2009).
27.
See Clifford, supra note 6 (discussing growing consumer demand for information
concerning working conditions in the production of clothing).
28.
See Michael R. Ward & Michael J. Lee, Internet Shopping, Consumer Search and
Product Branding, 9 J. PRODUCT & BRAND MGMT. 6, 9 (2000) (explaining that consumers
brand reliance often derives from limited information about credence attributes and
inherent difficulties in verifying information that is available).
29.
See KARINA FERNANDEZ-STARK, PENNY BAMBER & GARY GEREFFI, CTR. ON
GLOBALIZATION, GOVERNANCE & COMPETITIVENESS, THE FRUIT AND VEGETABLES GLOBAL
VALUE CHAIN: ECONOMIC UPGRADING AND WORKFORCE DEVELOPMENT 8 (2011) (explaining
how large supermarket chains exert significant influence over the fruit and vegetables
section and dictate how fruit and vegetables are produced, harvested, transported,
processed, and stored).
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for or to receive this type of information. Arguably, all online

purchases are those in which information about a product may not
be evaluated directly by a consumer. Perhaps this is no different
in kind from the decision to purchase clothing and even homes (in
a previous era) through a Sears Roebuck catalogue.30 But the scale
and ubiquity of online transactions demands a closer look at the
category of credence purchases.
Significantly, a number of scholars have identified a high
potential for manipulation, if not outright fraud or
misrepresentation around credence and experience goods.31 Legal
scholar Katherine Strandburg has recently extended this concern
to the context of privacy and free online advertising.32 Those who
consume the informational good of the Google search engine are
not informed about the types of private information conveyed to
the website intermediary as a result (for example, the consumers
browsing or purchasing habits, which are collected without
permission).33 In her view, this makes these types of online
exchange analogous to the purchase of more typical credence goods
such as organic food.34 In the context of aggressive and arguably
invasive online advertising paradigms made ubiquitous by
Google,35 combined with the vast quantities of goods sold online
without prior inspection, this is informational market failure of a
grand scale.
In more traditional realms of trademark law, courts have
endorsed, albeit weakly and inconsistently, the protection of
consumers beliefs formed in response to persuasive advertising.
Thus the misrepresentation of a products credence attributes
could potentially be captured within the ambit of actionable unfair
competition.36 In FTC v. Royal Milling, for example, the U.S.
Supreme Court held as misrepresentation the use of the term
30.
See JANE SMILEY, A THOUSAND ACRES 1516 (1991) (recalling the purchase of a
home from a Sears catalogue by the narrators great-grandparents in 1899).
31.
See, e.g., THALER & SUNSTEIN, supra note 14, at 7980; Kyle Bagwell, The
Economic Analysis of Advertising, in 3 HANDBOOK OF INDUSTRIAL ORGANIZATION 1701
(Richard Schmalensee & Robert Willig eds., 2007); Michael R. Darby & Edi Karni, Free
Competition and the Optimal Amount of Fraud, 16 J.L. & ECON. 67, 6872 (1973); J. Shahar
Dillbary, Trademarks As a Media for False Advertising, 31 CARDOZO L. REV. 327, 33942
(2009) [hereinafter Dillbary, Trademarks].
32.
Strandburg, supra note 4.
33.
See id. at 14245.
34.
Id. at 131.
35.
See James Gleick, How Google Dominates Us, N.Y. REV. BOOKS (Aug. 18, 2011)
(book review), http://nybooks.com/articles/archives/2011/aug/18/how-google-dominates-us/.
36.
See Shahar J. Dilbary, Famous Trademarks and the Rational Basis for Protecting
Irrational Beliefs, 14 GEO. MASON L. REV. 605, 61419 (2007); see also Dillbary,
Trademarks, supra note 31, at 34164 (explaining that trademark laws focus on unfair
competition between brands creates the potential for abuse of descriptive marks).
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milling to describe flour not sold directly by grinders, even

though the physical characteristics of the flour were no different
from flour sold directly from millers.37 Thus the idea of aligning
the subjective marketing of a product with its actual objective
credence characteristics (as expected by consumers) is not entirely
foreign to existing IP legal regimes. However, U.S. trademark law,
which is heavily premised on a passing off model of
misrepresentation, does not reach false, misleading, or deceptive
claims made by a firm with respect to its own brandswhat legal
scholar J. Shahar Dillbary has called intra-brand confusion:
[T]rademark law protects consumers against intra-brand
confusion only where the seller is using a descriptive term
or a descriptive mark. Such a use is considered to be false
and misleading under Section 43(a)(1)(B) of the Lanham
Act. Trademark law does not protect consumers against the
seller who uses a non-descriptive term that gains a
secondary descriptive meaning to mischaracterize its own
product. . . . [T]rademark law does provide a cause of action
against Stevita Co. if it decides to use aspartame instead of
the plant Stevia but nevertheless affixes the mark
Simply-Stevia to its sweetener. Yet, trademark law does not
protect the consumer who associates Splenda with a
sweetener made from sugar if Johnson & Johnson decides to
replace sugar with aspartame. . . . [C]ourts and
commentators are still conceptually captured by traditional
inter-brand thinking. Surprisingly, even today, a seller who
uses a non-descriptive mark to mischaracterize the nature
of its own product in a way that deceives the public is
immune from Section 43(a).
This anomalyprotecting consumers against false
information conveyed by descriptive terms but not fanciful
onescan be attributed to the focus of the scholarship and
the courts on the inter-brand function of trademarks.38
This leads to another informational market failurethat of
market manipulation.39 This is the tendency (or perhaps intent) of
firms to exploit the cognitive biases of consumers, by taking
advantage of their cognitive tendencies to confirm their initial
understandings of what a product is, or to minimize cognitive
dissonance, for example.40 Consumers have come to expect this,
37.
See FTC v. Royal Milling Co., 288 U.S. 212, 21518 (1933).
38.
J. Shahar Dillbary, Getting the Word Out: The Informational Function of
Trademark, 41 ARIZ. ST. L.J. 991, 102526 (2009) [hereinafter Dillbary, Getting the Word
Out] (citations omitted).
39.
See generally Hanson & Kysar, supra note 8.
40.
See id. at 637, 64647, 658, 74748.
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often ruefully acknowledging the ubiquity of corporate hypocrisy

and market manipulation.41
As a result of the hyper-focus on certain economic
assumptions, we may have missed a bigger policy picture: that
smart information is not as pervasively present within these legal
frameworks as demanded by the increasing reach of global
markets as well as increasingly savvy consumers. Conceptualizing
credence attributes as a type of informational transaction cost not
fully internalized provides a strong basis to introduce alternative
quality assurance mechanisms through the provision of smart
information. This is addressed in the next Part.
III. BUYER BEWARE: TRUST MECHANISMS OF GLOBAL VALUE
NETWORKS
This Article approaches global knowledge governance from a
particular anglethrough what are typically referred to as global
supply chains, and what I have elsewhere called global value
networks.42 Various scholars in the areas of international
relations, sociology, and transaction costs economics have focused
on governance of products comprised of component parts or
processes (components) within these value networks.43 Many of
those components are supplied from multiple sources typically
situated across different legal jurisdictions.44 Rather than being
41.
See Adam Kirsch, Why Whole Foods Is Popping up in Novels, DAILY BEAST (May
10, 2015, 12:01 AM), http://thedailybeast.com/articles/2015/05/10/why-whole-foods-is-pop
ping-up-in-novels.html?via=twitter_page.
42.
Margaret Chon, Slow Logo: Brand Citizenship in Global Value Networks, 47 U.C.
DAVIS L. REV. 935, 941 (2014) [hereinafter Chon, Slow Logo]. As I argued there, the term
supply in supply chain in the existing literature does not fully account for the value of
intangible components often shaped by IP and the activities of those who are technically
not suppliers of component parts, such as highly discerning and participatory consumers
who are also embedded within these global networks. Nor does the term chain within
supply chain quite describe the myriad directions and scope of global networked
transactions. Multiple and nested informational transactions are required in order for these
markets to function without a high degree of misrepresentation or fraud. This complex
informational environment is not only a feature of the production core but also of the
distribution and consumption ends of the network. While different industries have different
nodes and relationships between them, the basic issue of creating and maintaining trust
mechanisms is constant across otherwise disparate global value networks.
43.
See, e.g., GARY GEREFFI & KARINA FERNANDEZ-STARK, CTR. ON GLOBALIZATION,
GOVERNANCE & COMPETITIVENESS, GLOBAL VALUE CHAIN ANALYSIS: A PRIMER (2011)
(explaining dynamics of complex industrial interaction between actors in global
production); Gary Gereffi, John Humphrey & Timothy Sturgeon, The Governance of Global
Value Chains, 12 REV. INTL POL. ECON. 78 (2005) [hereinafter Gereffi, Humphrey &
Sturgeon, Global Value Chains] (proposing theoretical underpinnings of global value chains
based on different economic considerations).
44.
GEREFFI & FERNANDEZ-STARK, supra note 43, at 78; Gereffi, Humphrey &
Sturgeon, Global Value Chains, supra note 43, at 7980.
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regulated solely through territorially based forms of public law,

global value networks are governed by what could be characterized
as transnational, private forms of economic regulation.45
For example, scholars have identified the degree of
standardization (and codification) in global value networks (or
supply chains) as a key to moving away from a vertically
integrated firm to a less hierarchical and more modular product
assembly that draws components from other firms.46 But of course,
outsourcing risks a loss of quality control. Thus standards
governing components could be viewed as a type of soft law,
typically enforced through private contracts and sometimes
incorporated into public law. These standards ensure that
suppliers will provide components that comport with intermediate
buyers (although not necessarily consumers) expectations of
quality.
Where intermediate component goods bear a lower degree of
standardization or codification or both, far-flung firms may still
have a transactional relationship with each other. In this scenario,
[n]etwork actors . . . control opportunism through . . . repeat
transactions, reputation, and social norms . . . embedded in
particular geographic locations or social groups.47 These control
mechanisms include trust, reputation, and mutual dependence
through repeated transactionsabbreviated throughout the rest
of this Article as trust mechanisms.
Elsewhere I have argued that trust mechanisms should
extend to the point where the consumer buys the final product
the proverbial final mile in these global value networks.48
Information-generating activity is not fully controlled by a firms
production, marketing, and distribution efforts. Rather, market
information about a product is often co-created by both firm and
user. This value-adding (and sometimes value-subtracting)
activity by consumers has become increasingly decentralized and
distributed in its own right. Consumers of a particular product add
tremendous value through communicative activities, whether
signaling like on a products Facebook page, contributing to user
45.
TIM BTHE & WALTER MATTLI, THE NEW GLOBAL RULERS: THE PRIVATIZATION OF
REGULATION IN THE WORLD ECONOMY 2122 (2011); LISBETH SEGERLUND, MAKING
CORPORATE SOCIAL RESPONSIBILITY A GLOBAL CONCERN: NORM CONSTRUCTION IN A
GLOBALIZING WORLD 11315 (2010) (discussing fair trade labeling and other voluntary
standards).
46.
See GEREFFI & FERNANDEZ-STARK, supra note 43, at 811.
47.
Gereffi, Humphrey & Sturgeon, Global Value Chains, supra note 43, at 81; see
also Eric L. Lane, Greenwashing 2.0, 38 COLUM. J. ENVTL. L. 279, 30304 (2013) (discussing
B2B deceptive practices disrupting the clean energy supply chain).
48.
See Chon, Slow Logo, supra note 42, at 94548, 953.
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reviews, creating .sucks websites, or participating in even more

active forms of social media.49 Social theorists have characterized
these activities as neither production nor consumption, but rather
as prosumption50 within an informational network for which I
have coined the term cognitive capitalism.51 Others have
described this informational activity as the attention economy,
the aesthetic economy[,] and the experience economy.52 Many of
these postproduction activities, however, are forced to over-rely on
subjective impressions of a good or service (for example, this
product was not exactly what I expected), and are starved for
more objective measures that might appeal to a rational
consumer,53 such as smart information about credence attributes.
Where standardization is low, trust mechanisms are often
embedded throughout global networks so as to replicate, if
partially, the mechanisms analogous to face-to-face interaction in
more localized and physical environments to ensure quality.54 End
consumers may expect a rough correlation between price and
quality. But unlike a large brick and mortar retailer such as
Wal-Mart, or a digital intermediary such as Amazon, a typical
individual consumer does not have the buying power to force the
disclosure of varieties of nonprice information that they might be
interested in knowing.55
The main lesson that can be drawn from this global
knowledge governance literature is that the highly decentralized
transactions characteristic of global value networks require higher
degrees of coordination through standardization. And where lower
degrees of standardization are present, other trust mechanisms
must be robust. In these networked environments, the role of
smart information would be to convey either that a commonly
recognized standard or specific trust mechanism is satisfied.
49.
See id. at 963.
50.
George Ritzer & Nathan Jurgenson, Production, Consumption, Prosumption: The
Nature of Capitalism in the Age of the Digital Prosumer, 10 J. CONSUMER CULTURE 13, 29
30 (2010).
51.
Chon, Slow Logo, supra note 42, at 937; see also Anne Barron, Intellectual
Property and the Open (Information) Society, in THE SAGE HANDBOOK OF INTELLECTUAL
PROPERTY 5, 1617 (Matthew David & Deborah Halbert eds., 2015) (discussing the theory
that the digital revolution will lead to new forms of intellectual property law).
52.
See Jonathan E. Schroeder, Brand Culture: Trade Marks, Marketing and
Consumption, in TRADEMARKS AND BRANDS: AN INTERDISCIPLINARY CRITIQUE 161, 161
(Lionel Bently et al. eds., 2008).
53.
See David Vaver, Brand Culture: Trade Marks, Marketing and Consumption
Responding Legally to Professor Schroeders Paper, in TRADE MARKS AND BRANDS: AN
INTERDISCIPLINARY CRITIQUE 177, 197 (Lionel Bently et al. eds., 2008).
54.
See Gereffi, Humphrey & Sturgeon, Global Value Chains, supra note 43, at 81.
55.
See FERNANDEZ-STARK, BAMBER & GEREFFI, supra note 29, at 8.
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IV. COGNITIVE CAPITALISM: INTELLECTUAL PROPERTY IN GLOBAL

VALUE NETWORKS
IP exponentially multiplies the transactions described above
in the production of physical goods and services. It complicates the
global value network account with additional intangible layers
that do not necessarily track the tangible components or completed
goods in predictable ways. Just as a physical product will be
comprised of various components (for example, a semiconductor
chip may be a standardized supply component part of a PC), the
IP-protected intangibles add essential value components to many
physical and even digital goods. IP may be in the form of
trademarks such as Intel Inside for a component chip or Apple
for a tablet, trade dress protection for the outer design of a PC, or
semiconductor chip protection for the design of a chip. IP may also
be in the form of patent or copyright protection, either of which
may be obtained for the software embedded in the hard drive. And
in the consumption ends of the global value network, beyond
formal completion of a tangible product, other intangible
components add value. For example, the formation of intangible
business goodwill depends essentially on the activities of firms
vis--vis sophisticated end consumers.56
Legal
scholar
Julie
Cohen
describes
this
component-enhancing function of IP as post-industrial property:
The intangible expression or value protected by the exclusive
rights of IP is often
disaggregatedsliced and diced, fractionated and reused, in
ways that land could not be. Clips from news programs and
popular audiovisual works appear as featured material or
background material in documentary and feature films;
public performance rights in popular songs are licensed for
synchronization with films, television programs, and
advertisements; visual artworks may appear in the
promotional materials for arts organizations; and excerpts
from creative works of all types routinely appear in so-called
user-generated content, such as videos posted on YouTube
for the world to see.57
Internet intermediaries add to the intangibility of these
intangible layers, with its technologies that enable
crowd-sourcing, searching, uploading of user-generated content,
56.
WORLD INTELLECTUAL PROP. ORG., BRANDS REPUTATION AND IMAGE IN THE
GLOBAL MARKETPLACE 117 (2013), http://wipo.int/edocs/pubdocs/en/intproperty/944
/wipo_pub_944_2013.pdf.
57.
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streaming of content, storage in digital lockers, and the like.58 The

supply-centered narratives of IP, which might be described as
hierarchical models of control over IP, symbolically and materially
enforced in earlier eras by the printing press or vinyl recording
press, are being outsourced willy-nilly towards consumers and
their devices.59
What characterizes most of these IP-related activities is the
lower degree of standardization and codification that intrigues
transaction costs economists.60 Recall from the previous Part that
even in these relatively infelicitous conditions for outsourcing and
quality control, firms may still have a transactional relationship
with other firms as long as trust mechanisms are relatively robust.
These firms can engage less through vertically controlled ways,
and more horizontally along network nodes so long as trust
mechanisms are present.
Analogously, the transactional environment in IP is complex
and is moving away from purely supplier-oriented narratives of
production and distribution. Creative activities are shifting away
from traditional gatekeepers such as publishers, recording
studios, and movie studios.61 They are moving decisively towards
the activities of new information platform-based intermediaries
and associated value added by end-users aided and abetted by the
Internet and other distributed technologies.62
And in addition to the now familiar online delivery of books,
movies, and music, new networked technologies have been
jumping over the horizon into our line of view. These include 3D
printing, biosynthetic, and robotic technologies. Portending
further significant decentralization of production and distribution
channels of tangible goods, they add to the challenge of centralized
control wielded through the intangible exclusive rights of IP. This
phenomenon could be aptly called the Napsterization of things.63
Is it possible for IP to more directly facilitate the production
of verifiable knowledge within these global value networks, so that
58.
Daniel Gervais, The Tangled Web of UGC: Making Copyright Sense of
User-Generated Content, 11 VAND. J. ENT. & TECH. L. 841, 84650 (2009); Edward Lee,
Warming up to User-Generated Content, 2008 U. ILL. L. REV. 1459, 1460.
59.
Tim Wu, When Code Isnt Law, 89 VA. L. REV. 679, 712, 716 (2003).
60.
Gereffi, Humphrey & Sturgeon, Global Value Chains, supra note 43.
61.
Cohen, supra note 7, at 32; Wu, supra note 59, at 716.
62.
One example of this in the gaming space is Steam, which allows users to create
games
and
make
them
available
to
other
Internet
users.
STEAM,
http://store.steampowered.com/ (last visited Nov. 14, 2015).
63.
See Deven R. Desai & Gerard N. Magliocca, Patents, Meet Napster: 3D Printing
and the Digitization of Things, 102 GEO. L.J. 1691, 1692, 1697 (2014) (detailing the
digitization of tangible things and comparing potential patent and trademark liability for
3D printing intermediaries with the infringement claims raised against Napster).
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markets for IP-protected goods and services take place within a

more redundant, reliable, and robust informational exchange? In
this regard, verifiable knowledge must be distinguished from mere
content or marketing claims somehow.64 Smart information is
already coming into existence outside of IPs public law
frameworks, for example, through private standards,
certifications, protocols, and even user reviews.65 The Internet as
well as other distributed technologies offer multiple platforms for
smart information, especially if the power of crowd-sourcing
through vigilant consumers and nonprofit watchdog
organizations can be tapped. So while we cannot rely on naturally
perfect information, we increasingly have the technological means
to sculpt our current information environment so as to construct
smarter information.
The widespread copyright industry term content suggests
some degree of agnosticism as to its own accuracy, reliability, and
truth claims. Content includes subjective fantasy, such as The
Hobbit. Knowledge, by contrast, contains something of objective
verifiability in the realm of fact, often generated through
institutional means of quality control. From a knowledge (rather
than mere content) standpoint, The Hobbit is a book written by the
author J.R.R. Tolkien.66 In order to enjoy the fantasy, we do not
need to know or may not care about these facts. However, we do
rely upon certain kinds of verifiable information in order to
structure markets for copyright-protected goods and to coordinate
transactions within these markets such as licensing content.
While copyright law largely verifies authorship and ownership, it
is not regarded as a vehicle for conveying knowledge (or smart
information) about other credence attributes.
One might expect trademark law to meet some of the
challenges posed by the informational scarcities regarding
credence attributes. After all, one of the rationales for trademarks
is to convey a particular consistent quality to the consumers via a
mark.67 But trademark law also falls short. Assessing a products
64.
Paul A. David & Dominique Foray, Economic Fundamentals of the Knowledge
Society, 1 POLY FUTURES EDUC. 20, 46 n.1 (2003) (distinguishing between connaissance
and savoir in the context of describing tacit knowledge).
65.
See Joost Pauwelyn, Rule-Based Trade 2.0? The Rise of Informal Rules and
International Standards and How They May Outcompete WTO Treaties, 17 J. INTL ECON.
L. 739, 743 (2014).
66.
J.R.R. TOLKIEN, THE HOBBIT, OR THERE AND BACK AGAIN (Houghton Mifflin Co.
1938) (George Allen & Unwin, the original publisher, was acquired by Houghton Mifflin
Co.).
67.
Margaret Chon, Marks of Rectitude, 77 FORDHAM L. REV. 2311, 2315 (2009)
[hereinafter Chon, Marks of Rectitude]. See generally Mark P. McKenna, The Normative
Foundations of Trademark Law, 82 NOTRE DAME L. REV. 1839, 1844 (2007).
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quality largely occurs after purchase; even after purchase,

consumers will be unable to evaluate many of a goods less than
visible qualities such as whether it was manufactured in an
environmentally sustainable manner.68 Moreover, the conflation
of objective quality measures with subjective marketing methods
is well-documented.69 The use of certification marks allows a
consumer to access more objective information about the
standards underlying a particular good, it is a partial and
incomplete solution.70 As alluded to above and discussed more
below, trademark law only makes actionable false or misleading
credence claims under narrow circumstances.71
Assuming that many consumers are not feckless fools but
rather somewhat reasonable and discerning purchasers,72 they
might desire and even demand smart information about credence
attributes such as the sourcing of components. (Are they made in
sweatshop conditions? Are they made from metals sourced from
conflict-free zones? Will they help developing economies? Are they
environmentally sustainable?)73 Consumers could be interested in
the specific characteristics of the components (Are they going to
last more than a year? Are they easily replaceable if necessary?
Will they have certain chemicals that the consumer is allergic
too?), or other attributes that are not immediately observable.
Typically, an end consumer will not have access to the types of
product and process specifications that the intermediate buyer
and suppliers rely on in their transactions with each other. So even
if one of the attributes of concern to a consumer (sweatshop
conditions, for example) is something that is known to one of these
68.
See Nelson, supra note 24, at 31314.
69.
Ralph S. Brown, Jr., Advertising and the Public Interest: Legal Protection of Trade
Symbols, 57 YALE L.J. 1165, 1186 (1948).
70.
See infra text accompanying notes 11626; see also Chon, Marks of Rectitude,
supra note 67, at 2332 (describing how certification marks can ultimately lead to consumer
confusion).
71.
Dillbary, Trademarks, supra note 31, at 34142.
72.
See Barton Beebe, Search and Persuasion in Trademark Law, 103 MICH. L. REV.
2020, 2025 (2005) (differentiating between the rational consumer and consumer as fool);
Graeme B. Dinwoodie & Dev S. Gangjee, The Image of the Consumer in European Trade
Mark Law 10, 12 (Univ. of Oxford Legal Research Paper Series, Paper No. 83/2014, 2015),
http://ssrn.com/abstract=2518986 (assessing the Court of Justice of the European Unions
articulation of the average consumer).
73.
Daniele Giovannucci, Elizabeth Barham & Richard Pirog, Defining and
Marketing Local Foods: Geographical Indications for US Products, 13 J. WORLD INTELL.
PROP. 94, 10710 (2010); see also OPEN AFRICAN INNOVATION RESEARCH & TRAINING
PROJECT, PLACE-BASED BRANDING FOR LOCALLY SPECIFIC PRODUCTS (2014),
http://openair.org.za/images/Briefing-Note-Place-Based-Branding-for-Locally-Specific-Pro
ducts.pdf (discussing Nigerias hand-dyed Abeokuta cloth and the counterfeit products
threatening it marketability).
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upstream parties, it is usually not transparent to the downstream

buyers, including the users. This problem of dumb information
is so pervasive throughout the value network that it is regarded
as a natural and given feature of the current information
environment.74
Just as significant is that much information exchanged online
is
via
powerful
private
actorshuge
Internet-based
intermediariesprimarily to increase their vast informational
databases for purposes of lucrative data-mining activities. While
it is common to claim that the Internet has dis-intermediated
industries, such as the music recording industry, it is equally true
that it has created behemoth global digital intermediaries, such as
Amazon, Apple, Google, Microsoft, and others outside of the
United States. The danger with these current information
intermediaries might not be so much the over-decentralized
control over information described in this Article, but rather overly
centralized and selective control over information gathering and
distribution via the practice of tracking consumers on websites
through ad clicks.75 Secondarily (if at all), this information is used
to advance the public interest in access to smart information. Thus
an informational market failure of immense proportions exists,
either through underproduction or under-distribution of reliable
information by stakeholders, combined with possible
manipulation and hoarding of relevant information data sets by
dominant network actors.76
To add to these problems of information production,
behavioral science literature points to the likely incentive for firms
to engage in market manipulation through systematic exploitation
of cognitive biases against consumer interests. As Jon Hanson and
Douglas Kysar point out in the context of products liability law:
Other things being equal, it is in the manufacturers interest
for consumers to have the lowest estimate of product risks
possible: The lower the consumers risk estimate, the more
consumers will be willing to pay for the product, leading to
greater sales and increased profits for manufacturers.
Generating consumer underestimation of product risks in
this manner is simply another means of cost externalization,
a practice that manufacturers have every incentive to
pursue. Manipulation goes further than just minimizing
perceived costs, however. Manufacturers can also attempt to
74.
Katz, supra note 23, at 1561.
75.
Strandburg, supra note 4, at 123; Gleick, supra note 35.
76.
See Mark Scott, Google Rebuts Europe on Antitrust Charges, N.Y. TIMES (Aug. 27,
2015), http://nyti.ms/1K9513d.
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shape consumer views of product benefits. That is,

manufacturers may also elevate consumer willingness to pay
by manipulating the view that consumers have of a products
benefits (as opposed to its costs). In either case, consumer
failure to perceive product attributes accurately can lead to
undesirable levels of consumption.77
All of this suggests that many more incentives for the creation and
distribution of smart information are needed. Smart information
can function as partial trust mechanisms for arms-length
transactions, especially between consumers and firms, but also
among smaller firms that may not be the dominant information
intermediaries within a particular value network. Smart
information can also involve producers of goods and services in
meaningful ways that have not yet been acknowledged. Yet reliable
trust mechanisms via smart information are not yet pervasive.
Ostensibly concerned with regulation of knowledge, IP falls
short of the task of creating incentives for this type of knowledge.
For instance, it has long been observed and more or less accepted
as inevitable that trademarks often fall within the realm of
subjective marketing rather than objective truth claims.78 And of
course, because trademarks have evolved to reflect both subjective
and objective aspects of goodwill, a consumer will buy a product
(and its associated brand image) for reasons having something to
do with the quality of the good (e.g., iPads are reliable as well as
fun), but not necessarily. Most conflations of marketing
information with reliable information are not viewed as actionable
fraud as long as they are not overtly deceptive.79
Of course, one of trademarks primary functions is as a rough
guarantee of the qualities of a good, especially if the consumer can
benefit from repeated purchases in order to experience these
qualities. In other words, it already possesses some aspects of a
trust mechanism for qualities that a consumer can readily
experience. However, as analyzed above, typically and
increasingly, trademark cannot do this important work with
respect to embedded credence (as opposed to experience)
attributes.
77.
Hanson & Kysar, supra note 39, at 72425; see also Jeremy N. Sheff, Marks,
Morals, and Markets, 65 STAN. L. REV. 761, 80809 (2013) (discussing implications of
behavioral economics for trademark law). But see Rebecca Tushnet, Gone in Sixty
Milliseconds: Trademark Law and Cognitive Science, 86 TEX. L. REV. 507 (2008) (voicing
skepticism of the benefits of cognitive science in dilution litigation).
78.
Vaver, supra note 53, at 197.
79.
See id. at 18485 (analyzing an advertisement for coffee liqueur and concluding
that a rational consumer would understand that the product would not turn him from nerd
to knight).
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The scholarship examining supply chains offers important

insights that could be extended to the larger question of knowledge
governance along global value networks involving IP. A global
information network of cognitive capitalism (in which consumers
and producers increasingly do the work of verifying the attributes
of products and adding value to them via information exchanges)
can and should contain more workable trust mechanisms. The
provision of smart information already exists to some extent in the
middle production core dominated by business-to-business
transactions. The challenge is to bring these information systems
to the last mile of the networks, towards their distribution and
especially consumption ends. The next Part addresses various
legal means to do so.
V. KNOWLEDGE GOVERNANCE: SOME LEGAL HACKS
Transactions involving IP-related goods are characterized by
connectivity across technological, territorial, and political
borders.80 As a result, we have decisively entered an era of
regulatory complexity, change, and pluralism. As Cohen states,
The heterogeneity of intellectual production is a feature, not a
bug,
and
thus
IP
consists
of
a
heterogeneous,
resource-dependent set of legal and institutional forms shaped by
the constraints [and possibilities] of evolving technology and
political economy.81 Therefore global knowledge governance
demands attention to multiple, pluralistic forms of cross-border
regulation.
This Article suggests that whether through public or private
law, it is critical to identify more robust legal means by which to
provide smarter information about goods and services in the global
economy. The legal hacks or innovations suggested in this Part
have the objective of increasing transparency and verifiability of
information-embedded goods, so as to create reliable trust
mechanisms via smart information. What follows is not meant to
be a comprehensive prescription, but rather some starting points
and examples.
Of course, public institutions might increase regulation to
encourage or mandate disclosure of smart information. This can
set a framework for a varied set of private ordering mechanisms
such as contract law or tort law, combined with social norms.
Public institutions can exert a powerful impact, in their roles not
80.
Keith Aoki, (Intellectual) Property and Sovereignty: Notes Toward a Cultural
Geography of Authorship, 48 STAN. L. REV. 1293, 1304 (1996).
81.
Cohen, supra note 7, at 1011, 38.
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only as standard-setters but also as conveners and facilitators of

information markets. For example, the U.S. government has
recognized the need for trust in individual identities, in addition
to trusted intermediaries. President Obama authorized the U.S.
National Strategy for Trusted Identities in Cyberspace (NSTIC) in
2011. Its purpose is to facilitate an online environment where
individuals and organizations will be able to trust each other
because they follow agreed upon standards to obtain and
authenticate their digital identities . . . .82 In furtherance of this
goal, NSTIC is working on a so-called trust mark to certify that
certain data or identity systems meet certain requirements that
allow transactions to be made knowing that the person on the
other end is who they say they are.83 While this recent effort does
not address the larger knowledge governance issue of trusted
information embedded within products (as contrasted with
people), it shows that one significant information hold-up cost to
government-related transactions relates to verification and trust.
Pursuant to various U.S. statutes, various federal agencies
mandate in some manner disclosure of smart information.84 For
example, under provisions of the 2010 Affordable Care Act, chain
restaurants with at least twenty U.S. locations must display
calorie information on their menus.85 In 2014, the U.S. Food and
Drug Administration (FDA) released revised nutrition fact label
requirements that mandate that more prominent display of calorie
content be displayed, with the goal of implementation by 2017.86
These labeling initiatives in the United States and other countries
exemplify the recognition that smart information is critical to
consumption in global value networks of particular goods and
services.87 Some states and other local governments within the
United States have also demanded more information about supply
82.
WHITE HOUSE, NATIONAL STRATEGY FOR TRUSTED IDENTITIES IN CYBERSPACE 2
(2011), https://whitehouse.gov/sites/default/files/rss_viewer/NSTICstrategy_041511.pdf.
83.
See id. at 24.
84. See, e.g., Enforcement Policy Statement on U.S. Origin Claims, FED. TRADE COMMN
(Dec. 1, 1997), https://ftc.gov/public-statements/1997/12/enforcement-policy-statement-us
-origin-claims. FTC also puts out Green Guides to labeling environmentally friendly
products. See Environmentally Friendly Products: FTCs Green Guides, FED. TRADE COMMN,
https://ftc.gov/news-events/media-resources/truth-advertising/green-guides (last visited Nov.
14, 2015). Other examples include the Textile, Wool, and Fur Acts, 15 U.S.C. 6870 (2012),
(also enforced by the FTC), Tracking Labels for Childrens Products, 15 U.S.C. 2063,
(enforced by the Consumer Product Safety Commission), and the Food Modernization Act, 21
U.S.C. 22012252, (enforced by the Food and Drug Administration).
85.
See Patient Protection and Affordable Care Act, Pub. L. No. 111-148, 4205, 124
Stat. 573 (2010) (codified at 21 U.S.C. 343).
86.
Jason P. Block & Christina A. Roberto, Potential Benefits of Calorie Labeling in
Restaurants, 312 JAMA 887, 887 (2014).
87.
Vaver, supra note 53, at 195.
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chain management within the decentralized global setting

described in this Article. For example, California recently passed
the Transparency in Supply Chains Act (TSCA), which requires
companies to disclose whether their operations are free from
human trafficking.88 This is an effort to provide consumers with
more information about so-called clean supply chains.
Private nonprofit and nongovernmental organizations
(NGOs) provide oversight through various means intended to
increase the level of consumer awareness about credence
attributes. Some of these NGOs may have started as voluntary
industry initiatives, or have ties to the for-profit sector. One
example of this is Social Accountability International (SAI), which
certifies apparel manufacturers for compliance with voluntary
industry standards regarding factory safety.89 Other NGOs work
independently of industries they monitor, as illustrated by a
recent report from Oxfam about agricultural sourcing.90
Watchdog NGOs may also work hand in glove with public
agencies. For example, the California TSCA compels disclosure of
certain forms of information by companies that are engaging in the
global outsourcing of manufacture and production, specifically
whether they engage in audits and can certify to voluntary
standards.91 The statute itself does not compel the audits or the
adoption of standards themselvesthose auditing and
certification activities are still voluntary.92 Private NGOs have
piggybacked on these initial public disclosure requirements to
monitor the degree of compliance by covered firms.93
Finally, some for-profit firms have begun to disclose their
sourcing information as part of their marketing strategies.94 Some of
these companies have even created a brand around being able to trust
88.
CAL. CIV. CODE 1714.43 (West Supp. 2015).
89.
Dara ORourke, Multi-Stakeholder Regulation: Privatizing or Socializing Global
Labor Standards?, 34 WORLD DEV. 899, 915 app. A (2006) (listing the standards
promulgated by Social Accountability International).
90.
See OXFAM, THE BEHIND THE BRANDS SCORECARD METHODOLOGY (2014),
https://oxfam.org/sites/www.oxfam.org/files/file_attachments/btb_methodology_document_
final_sept_2014.pdf.
91.
1714.43(a), (c).
92.
See id.
93.
Bus. & Human Rights Res. Ctr., 85 Firms Still Silent on California
Transparency in Supply Chains Act, CORP. SOC. RESP. NEWSWIRE (Feb. 12, 2014, 4:43 PM),
http://csrwire.com/press_releases/36712-85-firms-still-silent-on-California-Transparency
-in-Supply-Chains-Act.
94.
In the apparel industry, the brand PATAGONIA, founded by Yvon Choinard, is
viewed widely as an early innovator in this regard. Its current website has what it calls a
footprint of its suppliers. PATAGONIA, http://patagonia.com/us/footprint (last visited Nov.
14, 2015).
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the source and quality of goodsfor example, that they are made
under fair labor conditionsand have provided means for consumers
to evaluate such information.95 However, other firms refuse to do so
for fear of losing competitive advantage through disclosure of trade
secrets, for example.96 This concern will have to be addressed,97
perhaps through the use of third party verification intermediaries.
Fully private verification systems have been created in the
context of online sales, such as the rating systems for sellers
operated by eBay98 and Amazon. More recently, distributed sharing
economy service providers such as Airbnb or Uber have had to
create robust systems to allow participants to trust each other
based on digital identities (such as the ownership of a Facebook
page) or other kinds of information such as accumulated user
reviews.99 The success of these online firms in connecting smart
information to profoundly physical, face-to-face goods and services
illustrates that trust mechanisms are a critical component to
knowledge governance infrastructure, whether for public or private
entities. As stated earlier, much of the electronic marketplace is
comprised of such credence purchasesthat is, purchases without
previous opportunity to examine the product in detail.
Soft law, such as protocols and standards, potentially
combined with certification marks and trademarks, might also
facilitate the disclosure of smart information. Some scholars have
recently suggested hacks to trademark law to facilitate the
provision of trademarks involving collaborative innovation.100
Others, including me, have examined the role of certification
marks, including the need to ensure the accuracy of third party
certification, in enhancing smart information.101
95.
See, e.g., Max Nisen, How Nike Solved Its Sweatshop Problem, BUS. INSIDER (May
9, 2013, 10:00 PM), http://www.businessinsider.com/how-nike-solved-its-sweatshop-pro
blem-2013-5 (noting that Nikes leadership in corporate social responsibility has allowed it
to transform its reputation).
96.
See Deena Shanker, 11 Food Companies That Wont Tell You Where Their
Meat Comes From, BUZZFEED (Apr. 10, 2014, 1:18 PM), http://www.buzzfeed.com
/deenashanker/companies-that-wont-tell-you-about-their-meat#.qwVjnzB9r
(noting
that Kraft does not disclose its suppliers because the company believes the suppliers
that help [Kraft] make [its] quality Oscar Mayer products are a competitive advantage
over other brands).
97.
See Elizabeth A. Rowe & Daniel M. Mahfood, Trade Secrets, Trade, and
Extraterritoriality, 66 ALA. L. REV. 63, 94 (2014) (noting that trade secrets do not confer a
monopoly but have the allure of perpetuity).
98.
Dillbary, Getting the Word Out, supra note 38, at 101618.
99.
Jason Tanz, How Airbnb and Lyft Finally Got Americans to Trust Each Other,
WIRED (Apr. 23, 2014, 6:30 AM), http://wired.com/2014/04/trust-in-the-share-economy/.
100.
See generally Yana Welinder & Stephen LaPorte, Hacking Trademark Law for
Collaborative Communities, 25 FORDHAM INTELL. PROP. MEDIA & ENT. L.J. 407 (2014).
101.
Chon, Marks of Rectitude, supra note 67, at 233530.
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Private regulatory alternatives such as certifications to

standards have become de facto forms of oversight over public
health and worker safety, more enforceable versions of which have
not been implemented via multilateral provisions of the
GATT/WTO or through national legislation.102 One advantage of
private over public legal means for tackling the issue of creating
smart information is that the question of disguised trade barriers
does not rear its head. This approach leaves potential flexibility
and policy space for domestic innovations in the provision of smart
information about labor and environmental issues. In an ideal
world, these domestic changes towards increased labor standards
then spread through global networks to become de facto regulatory
minima for cross-border business.103
With respect to global textile and apparel industries, for
example, many developing countries had viewed worker safety
standards as barriers to trade in areas in which they had
comparative advantage, and therefore chose as a matter of
domestic social welfare to reduce treaty-mandated regulation of
worker safety.104 Instead, voluntary codes of conduct and
corporate social responsibility initiatives have substituted for
government enforcement of health and safety standards, and
efforts have been made to extend this information to consumers
through certifications, such as the fair trade certification,
promulgated by the Fairtrade Organization,105 and others.106 The
recent media attention to the conditions in Apple factories
overseas is an example of increasing awareness of component
manufacturing conditions, while it also illustrates the lack of
ready information about credence attributes of goods by
concerned consumers.107
The California TSCA is a type of mandated disclosure or
notice, [and] works by requiring the provision of facts with the
hope that consumers or citizens will use those facts to protect
102.
See JOHN BRAITHWAITE & PETER DRAHOS, GLOBAL BUSINESS REGULATION 234
36 (2000).
103.
Id. at 23637.
104.
Tim Bartley, Certifying Forests and Factories: States, Social Movements, and the
Rise of Private Regulation in the Apparel and Forest Products Fields, 31 POL. & SOCY 433,
44454 (2003).
105.
See Standards, FAIRTRADE INTL, http://fairtrade.net/standards.html (last visited
Nov. 14, 2015).
106.
Paulette L. Stenzel, Mainstreaming Fair Trade and Resulting Turmoil: Where
Should the Movement Go from Here?, 37 WM. & MARY ENVTL. L. & POLY REV. 617, 64553
(2013) (discussing the proliferation of fair trade certifications and the various companies
that employ them).
107.
Richard Bilton, Apple Failing to Protect Chinese Factory Workers, BBC NEWS
(Dec. 18, 2014), http://bbc.com/news/business-30532463.
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themselves and police the market.108 Large markets such as

California (which is estimated at 10% of the overall U.S. economy)
may pave the way through such initiatives for trading up to
higher labor standards globally, in the same way that California
increased environmental standards nationally through emissions
control requirements.109 Notice provided by public institutions and
enforced through decentralized and privatized value networks is a
possible alternative to fully state-based interventions. At the same
time, these types of regulatory alternatives are not as vulnerable
to trade-based legal challenges that more top-down enforceable
regulations might be.
Whether via public or private means, the examples above
indicate that there is substantial untapped potential to provide
distributed smart information channels with regard to many of the
credence attributes that will extend markets for IP-embedded
goods and create more robust informational markets about them.
Smart information is a public good, in the political science sense
as well as economics sense of the term. It provides essential
infrastructure for additional socially beneficial activities.
Information about credence attributes is already being provided,
albeit on a smaller scale than may be socially optimal. Thus, we
are arguably at the tip of the proverbial iceberg with respect to
enhancing smart information whether through public initiatives
such as NSTIC, or private such as Airbnb (or even in the form of
loose publicprivate partnerships such as the California statute,
which provides a notice function in conjunction with various
monitoring NGOs).
VI. TRACERMARKS: A PROPOSED INFORMATION INTERVENTION
The Internet-based information systems described in the
previous Part could create and shape smart information relating to
the welfare-enhancing awareness of credence qualities that matter,
such as sustainability in manufacturing and distribution. However,
this Article has yet to address how current IP could expand to
include trust mechanisms in addition to the pervasive mechanisms
of exclusive rights. This concluding Part posits one of many possible
ways to take advantage of existing flexibilities and room for
108.
Ryan Calo, Code, Nudge, or Notice?, 99 IOWA L. REV. 773, 775 (2014) (citing Omri
Ben-Shahar & Carl E. Schneider, The Failure of Mandated Disclosure, 159 U. PA. L. REV.
647, 64950 (2011)); see THALER & SUNSTEIN, supra note 14, at 8387 (discussing the
propensity of consumers to select default choices or recommended choices as information
complexity increases).
109.
DAVID VOGEL, TRADING UP: CONSUMER AND ENVIRONMENTAL REGULATION IN A
GLOBAL ECONOMY 56, 24870 (1995).
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evolution within existing public law frameworks. It focuses on a

proposed tool, which is tentatively entitled a tracermark. As
explained further below, tracermarks would benefit both consumers
and producers, and could reduce pervasive information
asymmetries and scarcities. By doing so, they arguably would
contribute to a meaningful increase in global social welfare.110
Examples of IP legal innovations on opposite ends of the
spectrum of private ordering are open source licenses and
end-user license agreements (EULAs), which Cohen calls
bespoke entitlements.111 While copyright law has recently
included a number of innovative legal mechanisms such as
Creative Commons (CC) licenses, EULAs, and open source
licenses, which alter the nature and distribution of knowledge in
various ways,112 trademark law seems arguably relatively inert
by contrast. Yet trademark law has enormous untapped potential
for encouraging more distributed and nuanced knowledge
governance forms, as well as to increase its objective
information-disclosing qualities.
Currently, trademarks are dominated by a search cost
rationale, which posits that their primary function is to provide an
efficient signal for (rational) consumers to associate a product or
service with a particular origin of manufacture or source.113
Sometimes referred to as trademarks signaling function, this
theory posits that marks serve primarily to decrease consumers
search costs by providing them with a shorthand reference or
symbol upon which they can rely repeatedly.114 While consumer
searches (and ensuing satisfaction) can accumulate and
eventually contribute to the formation of trust mechanisms via
trademarks, this prevailing view falls short of fully addressing the
so-called trust function of marks.115
Certification marks could fill this trust gap to some extent. In
previous work, for example, I have canvassed the role of certification
110.
However, some may argue that the creation of desire that drives the consumer
economy, and with it environmentally unsustainable economic growth, does not contribute
at all to overall social welfare and that it is antithetical to the values purportedly
represented by so-called anti-growth marketing. See, e.g., J.B. MacKinnon, Patagonias
Anti-Growth Strategy, NEW YORKER (May 21, 2015), http://newyorker.com/
business/currency/patagonias-anti-growth-strategy.
111.
112.
Id. at 4445.
113.
See Stacey L. Dogan & Mark A. Lemley, Trademarks and Consumer Search Costs
on the Internet, 41 HOUS. L. REV. 777, 78688 (2004).
114.
See id.; William M. Landes & Richard A. Posner, Trademark Law: An Economic
Perspective, 30 J.L. & ECON. 265, 27576 (1987).
115.
See Katz, supra note 23, at 156769 (arguing that trademarks cannot reliably
fulfill their trust function if search costs cross a certain threshold).
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marks in conveying information about certain qualities of a product

that are not immediately apparent to a consumer (in the context of
fair trade coffee and apparel, for example).116 Although certification
marks go beyond the typical search function of trademarks into the
realm of credence attributes, they also fall short of providing
robustly reliable information because of several key omissions. One
enormous weakness of certification marks is that they do not involve
consistently reliable trust mechanisms. The certification process,
which purports to require adherence to objective standards, is
vulnerable to the whims of the certifying bodies, which are often
compensated by the very organizations whose products they are
certifying. Currently, there is relatively little oversight of the
enforcement of standards, and almost no information provided
readily to consumers about the standards themselves. Standards are
a mandatory part of the application to the national office (USPTO,
for example) but only infrequently challenged and even more
infrequently used as a basis for cancelling the mark.117
Another challenge with certification marks is that consumers
often have difficulty interpreting them.118 Certification marks
represent underlying standards, which are not discernable from
the face of the mark. In some sectors, they may also proliferate so
that multiple and competing marks may exist, resulting in
consumer confusion of an entirely different sort than the passing
off type of misrepresentation that is the focus of classic trademark
law. For example, there are multiple certifying schemes for coffee,
including Equal Exchange, Fairtrade International, Rainforest
Alliance, and Utz.119 (The university I work for recently announced
its own Jesuit brand of certified fair trade coffee called Caf
Ambiental.)120 Thus the consumer may be faced both with too little
and too much information, but not with the optimal amount that
116.
Chon, Marks of Rectitude, supra note 67, at 234144; JEFFREY BELSON,
CERTIFICATION MARKS 56 (2002) ([In Anglo-American law, a] certification mark is
statutorily defined as an indication that goods, or services, in connection with which the
mark is used, are certified by the proprietor in respect of origin, material, mode of
manufacture of goods or performance of services, quality, accuracy or other
characteristics.).
117.
See, e.g., Swiss Watch Intl, Inc. v. Fedn of the Swiss Watch Indus., 101
U.S.P.Q.2d (BNA) 1731, 1746 (T.T.A.B. 2012) (refusing to cancel the certification SWISS
MADE).
118.
Dev Gangjee has noted this problem as well with geographical indications in the
form of the European Protected Designation of Origin. Dev S. Gangjee, Proving Provenance
and Authenticating Authenticity? Geographical Indications Certification and Its
Ambiguities, WORLD DEV. 7 (forthcoming 2015), http://dx.doi.org/10.1016/j.world
dev.2015.04.009 [hereinafter Gangjee, Proving Provenance].
119.
Chon, Marks of Rectitude, supra note 67, at 234143.
120.
See Mike Thee, Coffee with Conscience, SEATTLE U. NEWS (Nov. 24, 2014),
http://seattleu.edu/news/featurearticle.aspx?id=146552.
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would enable access to the relevant differences among credence

attributes. Researching the difference between different kinds of
fair trade coffee, for example, could take hoursand that work
might still not result in the specific information the consumer is
wishing for.121
And furthermore, certification marks carry substantial
administrative costs.122 Certifications depend upon a separate
certifying body, which can be a government, industry association,
or NGO. In some sectors, this certifying process may be feasible
because the infrastructure and resources may be relatively easy to
amass. In others, this requirement poses a substantial barrier to
entry. This point is driven home by the recent example of the
Ethiopian governments decision to license coffee from the Sidamo
region of Ethiopia as a trademark, rather than as a certification
mark.123 Part of the reason for this was the prohibitive
administrative costs of certifying coffee, even for a national
government body.124 Moreover, from the perspective of the
producers, the additional expense of certification may make it
impossible for farm holders to participate in certification schemes,
and in other cases, it leads to a net non-increase (or even decrease)
in revenue, especially for smallholders.125 An additional cost stems
from the issue that certification marks themselves require
extensive marketing (in addition to any trademark), in order to
build consumer recognition. Beyond these issues, many countries
do not have certification laws and this lack of uniformity poses
another obstacle to cross-border enforcement of standards through
certifications.126
By contrast, a tracermark could efficiently convey smart
information similar to what might be (but is typically not)
121.
Several years ago, multiple research assistants compiled a fair trade coffee matrix
for these four types of certifications. It took them many hours to summarize their standards
for me.
122.
See Raluca Dragusanu, Daniele Giovannucci & Nathan Nunn, The Economics of
Fair Trade, J. ECON. PERSP., Summer 2014, at 217, 22728.
123.
LIGHT YEARS IP, DISTINCTIVE VALUES IN AFRICAN EXPORTS: HOW INTELLECTUAL
PROPERTY CAN RAISE EXPORT INCOME AND ALLEVIATE POVERTY 9, 1415 (2008),
http://slideshare.net/webgoddesscathy/distinctive-values-in-african-exports-how-intellectu
al-property-can-raise-export-income-and-alleviate-poverty-presentation; Fiona Rotstein &
Andrew Christe, Blood, Toil, Tears and Sweat: The Battle of Sidamo 1215 (Univ. of
Melbourne, Legal Studies Research Paper No. 531, 2009), http://papers.ssrn.com
/abstract=1721984.
124.
See Rotstein & Christe, supra note 123, at 1314.
125.
CHRISTOPHER CRAMER ET AL., FAIRTRADE, EMPLOYMENT AND POVERTY
REDUCTION IN ETHIOPIA AND UGANDA 2022, 124 (2014), http://ftepr.org/wp
-content/uploads/FTEPR-Final-Report-19-May-2014-FINAL.pdf.
126.
B. Brett Heavner, World-Wide Certification-Mark Registration: A Certifiable
Nightmare, BLOOMBERG L. REP.: INTELL. PROP., Dec. 14, 2009, at 12, 1214.
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conveyed through a certification mark. Tracer is an intentional

mash-up of trademark and certification mark, and a tracermark
would have some characteristics of both. As a hybrid category, its
main purpose would be to provide consumers with smart
information so as to be able to trace certain credence attributes of
goods and services. Information about underlying attributes would
be publicly available to consumers and others through
smartphones and other Internet-based technologies. Indeed, the
U.S. Secretary of Agriculture recently suggested to Congress that
consumers could trace GMO foods this way, stating:
[C]onsumers could just use their phones to scan special bar
codes or other symbols on food packages in the grocery store.
All sorts of information could pop up, such as whether the
foods ingredients include genetically modified organisms, or
GMOs. . . . Industry could solve that issue in a heartbeat.127
To ensure integrity of the information, the overall data set
associated with a particular tracermark might be compiled by
multiple stakeholders. Third party information intermediaries or
aggregators could collate and compare information provided by
different tracermarks, including information added by consumers,
producers, and other stakeholders contributing to the value
network. Tracermarks themselves or perhaps their aggregators
could be viewed as information platforms. For example, if a
tracermark was a type of ubiquitous symbol, similar to a bar code
or QR code on the surface of a product, one could easily imagine
the development of smart phone applications that could scan the
information in the label and even eventually answer queries of
consumers regarding specific concerns. Or an aggregator could
construct a platform (lets say, called a Wiki-tracer) to allow
distributed stakeholders to contribute information regarding
sourcing of a product. In addition to the typically indecipherable
certification symbols that currently signify adherence to standards
regarding electronic components on the bottom of a laptop, for
example, a tracermark would allow consumers to understand what
some of those symbols mean or to query about other characteristics
of the various components journeys through the global value
network ending in the product. This could include information
about labor conditions and other significant attributes.
In order to facilitate meaningful disclosure, the tracermark
itself should be symbolically efficient. This would address the
127.
Mary Clare Jalonick, Ag Secretary: Smartphones Could Tell Buyers Whats in
Food, WASH. TIMES (Feb. 26, 2015), http://www.washingtontimes.com/news/2015/feb
/26/vilsack-smart-phones-could-tell-consumers-whats-in/?page=all (quoting Tom Vilsack,
Secretary of Agriculture).
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problem of too much or too little information associated with

certification marks. For instance, the information platform must
have some common public method of simplifying, summarizing,
and possibly comparing key credence characteristics. If Starbucks
wanted to make sure its private fair trade standards (currently
called C.A.F.E., standing for Coffee and Farmer Equity)128 are
clearly communicated to its coffee-drinking clientele, for example,
it would disclose these private standards. Other companies that
purport to follow other fair trade standards such as those
promulgated by Fairtrade Organization would also disclose their
standards. This would then allow competing standards to be
compared. Many of the existing fair trade marks applied to
agricultural commodities are in fact certification marks, held and
administered by certifying entities.129 A publicly available matrix
would include both tracermarks and certification marks that cover
the same attributes. The scope of information associated with a
product or service would have to be curated and managed so that
it discloses optimal types and amounts of smart information
requested by a consumer.
To incentivize disclosure of smart information, consumers
might choose to reward companies that disclose attributes that are
significant to consumer purchasing decisions, and to penalize
companies that do not comply with disclosure through consumer
nonpurchases or boycotts. Conceivably, disclosure of smart
information could give firms a competitive advantage within this
realm of greater choice. This competition for customers over
credence attributes is already evident. For example, Whole Foods
has recently followed in the footsteps of Wal-Mart in announcing
more transparent sourcing information about its products in the
United States.130 A step beyond simple disclosure might be
provided by links from the smart information platform to a
separate purchasing platform. This is illustrated already by the
rating systems of the Environmental Working Group (EWG),
which evaluates consumer products for harmful chemicals.
Recommended products are linked to Amazons website for ready
128.
See Ethical Sourcing: Coffee, STARBUCKS, http://starbucks.com/responsibility
/sourcing/coffee (last visited Nov. 14, 2015).
129.
See, e.g., The Fairtrade Marks, FAIRTRADE INTL, http://www.fairtrade.net/the
-fairtrade-marks.html (last visited Nov. 14, 2015) (conditioning use of the fairtrade mark
on prior written approval from the Fairtrade organization).
130.
Alison Griswold, Whole Foods Desperately Wants Customers to Feel Warm and
Fuzzy Again, SLATE: MONEYBOX (Oct. 20, 2014, 5:39 PM), http://slate.com/blogs
/moneybox/2014/10/20/whole_foods_ad_campaign_can_values_matter_marketing_erase_th
e_whole_paycheck.html.
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purchase.131 These recent examples show that episodic efforts in

the private sector are already underway to ramp up the provision
of smart information.
From the public sector, another interesting recent example
comes from the state of Washington, which recently enacted a
seed-to-sale framework for legalized marijuana. The Washington
State Liquor Cannabis (formerly Control) Board (WSLCB)
oversees all production, processing, and sale of recreational
marijuana.132 The WSLCB implemented the BioTrack THC
tracking system to track marijuana through the supply chain.133
This system uses a series of unique sixteen-digit barcodes to track
marijuana plants.134 The WSLCB also requires that each batch of
marijuana harvested be tested by a third party independent
laboratory facility for a variety of defects such as mold, mildew,
and pesticides. If a retail customer requests the results of the lab
testing, the retailer must disclose the information.135 Other
provisions of the WAC include not labeling marijuana products as
organic unless independently certified by the U.S. Department
of Agriculture in accordance with the Organic Foods Production
Act. And all labels must include the lot number and Unified
Business Identifier of the producer.136 A white paper written
during the early stages of drafting the WSLCBs rules suggested
that [i]t would be in the interest of consumers . . . to require lab
results be posted on a website . . . . It would also be beneficial to
131.
A recent example that I have used personally is: EWGs Guide to Sunscreens,
ENVTL. WORKING GROUP, http://ewg.org/sunscreen/ (last visited Nov. 14, 2015). Ultimately,
however, I used the information provided by the website to then purchase the product at a
local food coop.
132.
Initiative Measure No. 502 authorizes the state liquor control board to regulate
and tax marijuana for persons twenty-one years of age and older and adds a new threshold
for driving under the influence of marijuana. Initiative Measure No. 502 1 (Wash. 2011),
http://sos.wa.gov/_assets/elections/initiatives/i502.pdf.
133.
The WSLCB states:
[L]icensed marijuana producers, processors, and retailers are free to employ their
own inventory tracking software solutions as long as it allows for the collection
and submission of the specific information and reports required by the WSLCBs
seed-to-sale inventory tracking rules for Licensees. Licensees are required to
submit specific information and reports to the WSLCB. To ensure compliance with
Washington State regulations, the traceability system provides functionality to
assist with analysis of information, auditing operations, and enforcement by the
WSLCB.
Traceability System, WASH. ST. LIQUOR & CANNABIS BD., http://liq.wa.gov
/mj2015/traceability_system (last visited Nov. 14, 2015).
134.
Anna Staver, How Do Washington, Colorado Track Their Pot?, STATESMAN J.
(Salem) (Nov. 20, 2014, 5:22 PM), http://statesmanjournal.com/story/news/politics
/2014/11/20/washington-colorado-track-pot/70013080/.
135.
WASH. ADMIN. CODE 314-55-105(3) (2015).
136.
Id. 314-55-105(4)(5).
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post publicly the producers use of pesticides, herbicides, and

fungicides, as required to be posted on the label.137 However, this
suggestion has not yet been implemented.
In addition, any tracermark system has to anticipate possible
manipulation by market actors and Internet trolls. In many of the
currently popular consumer ratings systems, such as Yelp,
TripAdvisor, and Angies List, the problem of fake reviews has
become pervasive.138 Impartiality in the construction of trust
mechanisms is a critical soft spot (coinciding with the weak point
within certification systems). One possible solution could be
multiple certifiers, which would then compete and possibly check
each other to provide more reliable information. As Jeanne Fromer
has pointed out, information theory suggests that noise in a
message transmission can be reduced, if not entirely overcome, by
introducing redundancy into the message . . . [which] make[s] it
more likely that consumers will gain access to the transmitted
knowledge.139 Another answer might be the existence of a
meta-certifier that evaluates reliability across certifying
platforms. Yet another might be to combine the certification
platform with consumer crowd-sourcing so as to discourage
producer manipulation. Even assuming that self-interested firms
could be excluded effectively, however, consumers may not be in
the best position to assess credence attributes or to anticipate
other consumers concerns and interests.140 Verifiability of stated
compliance to standards would continue to present a thorny issue.
Tracermarks are situated between a regular trademark (in
which, as described above, there is often no formal liability
whatsoever for false, misleading, or deceptive claims about the
qualities of a good) and a certification mark (which in theory is
open to revocation or invalidity based upon failure to conform to
standards). This suggests that careful thought needs to be given
to any liability structure for incomplete or fraudulent information.
This proposal must contend with the pervasive and deeply
137.
Memorandum from BOTEC Analysis Corp. to Randy Simmons, Deputy Dir.,
Wash. State Liquor Control Bd. 7 (June 17, 2013), http://lcb.wa.gov/publications
/Marijuana/I-502/small_business_impact_statement/botec_white_paper_2.pdf.
138.
Michael Luca & Georgios Zervas, Fake It Till You Make It: Reputation,
Competition, and Yelp Review Fraud 78 (Harvard Bus. Sch., NOM Unit Working Paper
No. 14-006, 2015), http://papers.ssrn.com/abstract=2293164.
139.
Jeanne C. Fromer, An Information Theory of Copyright Law, 64 EMORY L.J. 71,
90 (2014).
140.
See Amazon vs. B&N vs. Goodreads: Rating the Ratings, NEW DORK REV. BOOKS
(June 20, 2011), http://thenewdorkreviewofbooks.com/2011/06/amazon-vs-b-vs-goodreads
-rating-ratings.html (comparing the differences in ratings of five novels from Amazon,
Barnes & Noble, and Goodreads, and admitting the blogs own shortcomings in evaluating
books).
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embedded marketing norms to deliberately conflate objective with

subjective measures of quality through lifestyle marketing as
opposed to informational marketing, as well as the potential for
firm liability for disclosure under unfair competition laws or other
private enforcement actions. This last possible disincentive could
be addressed by making the tracermark independent of any of the
firms involved with manufacture and distribution or providing
safe harbors for certain kinds of disclosures related to a
tracermark, or both.141 In addition, provisions to address possible
disclosures of trade secrets or other forms of competitive
disadvantage would be necessary.
While the scope of coverage of geographical indications (GIs)
is tiny compared to the overall trademark domain, it is worth
discussing briefly because it provides a significant potential wedge
to normalize the provision of information about provenance of
products more generally. Systems involving tracing adherence to
standards are also more developed in GI law, and could provide a
possible (if not perfect) model for traceability for tracermarks.142
The central concern in GI law is whether the quality, reputation
or other characteristic of a good is essentially attributable to its
geographic origin.143 The oft-cited example is champagne as a
GI applied to sparkling wine from the Champagne region of
France.144
While the concept of GIs as a type of IP is not deeply
embedded within U.S. IP norms, Daniel Gervais has nonetheless
noted:
[A]s consumers of wine, food and other geographically
determined products understand information conveyed by
food and wine labels better, they will also expect those labels
to be accurate when the information conveyed is perceived as
denoting a geographical origin. Geographic certification
mark infringement should be subject to a dynamic legal test,
for which a threshold might be crossed when the consumer
141.
Cf. Dillbary, Trademarks, supra note 31, at 36061 (parsing the 1988
amendments so that the preamble and section 43(a)(1)(B) would read as follows: Any
person who . . . uses in commerce any trademark . . . which . . . in commercial
advertising . . . misrepresents the nature, characteristics, qualities, or geographic origin of
his or her . . . goods . . . shall be liable in a civil action (alterations in original)).
142.
But see BELSON, supra note 116, at 56. I am indebted to Dev Gangjee for his
insights here.
143.
Agreement on Trade-Related Aspects of Intellectual Property Rights art. 22, Apr.
15, 1994, Marrakesh Agreement Establishing the World Trade Organization, Annex 1C,
1869 U.N.T.S. 299.
144.
Daniel Gervais, A Cognac After Spanish Champagne? Geographical Indications
As Certification Marks, in INTELLECTUAL PROPERTY AT THE EDGE 130, 139 (Rochelle Cooper
Dreyfuss & Jane C. Ginsburg eds., 2014).
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search costs increase because the consumer is better

informed about what a wine label conveys and finds
information now perceived as geographical in nature
confusing or inaccurate.145
Legal scholar Dev Gangjee has recently dived deeply into the
processes of specifying and complying with individual product
specifications. He has found, for example, that even the most
coveted and well-known GIs such as Stilton Cheese in the United
Kingdom or Proscuitto di Parma in Italy sometimes source some
of their raw materials (milk and pork, respectively) outside of the
geographic region associated with them. According to him, these
sourcing practices could cast doubts on the reliability of the
certification system.146 To return to the Ethiopian Sidamo coffee
example, it has been observed that:
As important as branding and delivering a high quality
and distinctive product is ensuring the transparency of the
relevant supply chain. Only if products are traceable to their
origin can consumers be assured that they are receiving the
trademarked product they have purchased, and only then
can the exporters demand that producers receive premium
prices.
The [Ethiopian Coffee Exchange], organised as an
independent publicprivate enterprise, offers an innovative
model for providing such an open and transparent market.
Its provision of market information and quality control
coupled with a trading platform represents an essential
service to the producers and exporters of the Ethiopian
Trademarking and Licensing Initiative. By creating a
transparent trading system, it eliminates the need for a
track and trace system designed specifically for the
trademarked coffee.147
At the heart of this type of IP is the verification of the
provenance of a GI-protected product, essentially its credence
attributes associated with a particular region. But this form of
governance has to be accompanied by vigorous trust mechanisms
in order to work the way it is intended to workotherwise, the GIs
can become just another marketing tool for fuzzy subjective claims
about the product. As Irene Calboli has pointed out, the current
legal framework leaves open the possibility for opportunistic
behavior by large firms that may exploit the trust consumers have
145.
146.
147.
Id.
Gangjee, Proving Provenance, supra note 118, at 7.
KATE BIRD ET AL., OVERSEAS DEV. INST., ETHIOPIAN TRADEMARK AND LICENSING
INITIATIVE: SUPPORTING A BETTER DEAL FOR COFFEE PRODUCERS THROUGH AID FOR TRADE
13 (2009), http://odi.org/resources/docs/5946.pdf.
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about these products, without corresponding smart information

with which to evaluate whether they are in fact locally produced.148
While the traditional rationale for GIs is producer focused, in
contrast to trademark law, which centers on preventing consumer
deception, tracermarks would have the same function in either
domain: the success of GI-protected goods may depend on whether
attributes can be traced more rigorously in the postproduction
value network, to the consumers satisfaction.
Overall the tracermark proposal is rooted in the insight that
technical specifications and standards do not obviate public
regulation per se, but rather complement and extend public
initiatives. Transparency of this interface is an important criterion
of good global governance. The operation of these global value
networks can benefit greatly from wider social participation and
oversight. As Tim Bartley has cogently observed from his work on
sustainable forestry and apparel manufacturing in Indonesia,
attention to how standards embedded in codes of conduct are
implemented on the ground can make the critical difference in
whether they operate as intended. Whether public or private, rules
on the books can deviate greatly from rules in action.149 From
a knowledge governance perspective, tracermarks involve
multiple stakeholders in the implementation and sharing of
rulesthat is, the credence attributes now embedded in
standards. Because of this heightened involvement by diverse
stakeholders, tracermarks thus have a greater potential to hew to
objective information, facilitating greater adherence to standards
in action. They might also allow relatively disempowered
stakeholders, such as factory workers, within the value network to
have more direct connection to consumers, who then could make
choices based upon the information provided on the ground.150
148.
Irene Calboli, In Territorio Veritas: Bringing Geographical Coherence into the
Definition of Geographical Indications of Origin Under TRIPs, 6 WIPO J. 57, 6667
(2014); see also Delphine Marie-Vivien et al., Trademarks, Geographical Indications and
Environmental Labelling to Promote Biodiversity: The Case of Agroforestry Coffee in
India, 32 DEV. POLY REV. 379, 38384 (2014) (arguing against descriptively termed
trademarks that fail to provide a guaranteed link between a product and the products
origin).
149.
Bartley, Puzzle of Rules, supra note 10, at 232; Bartley, Layering of Rules, supra
note 10.
150.
See Laborlink Services, GOOD WORLD SOLUTIONS, http://goodworldsolutions.org
/services/ (last visited Nov. 14, 2015) and Transparent Supply Chains for Corporate Brands:
A Voice for Global Workers, LABORVOICES, http://laborvoices.com (last visited Nov. 14,
2015) for examples of websites that allow workers to report conditions in their factories.
Other initiatives involve matching employers who give living wages to workers who seek
them. See How to Become a Living Wage Employer, LIVING WAGE FOUND.,
http://www.livingwage.org.uk/how-become-living-wage-employer (last visited Nov. 14,
2015); see also David Welsh, Opinion, Fair Trade for the Global Garment Industry, N.Y.
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This proposal bears some similarity to emerging proposals for

regulatory redesign, some of which are premised on behavioral
economics and others that are skeptical of behaviorism as a
panacea. For instance, tracermarks are one example of the concept
of mapping and structuring of complex choices, advocated by
economist Richard Thaler and legal scholar Cass Sunstein.151
According to these behaviorists, the presentation of information in
particular ways allows less than completely rational actors to
make different choices than they would without such
information.152 A trivial example is Netflix, which allows
customers to search movies by actor, director, genre, and more,
and if they rate the movies they have watched, they can also get
recommendations based on the preferences of other movie lovers
with similar tastes, a method called collaborative filtering.153
The tracermark concept also resembles the suggestions for
regulatory reform by those critical of behavioral approaches, such
as legal scholars Omri Ben-Shahar and Carl Schneider, who are
skeptical of ubiquitous disclosure requirements, which they claim
few people read and even fewer understand. Rather than
mandated disclosure (or notice), they recommend relying instead
on intermediaries (including aggregators and savvy consumers)
for the provision of comprehensible information relevant to
decision-making.154
Thus tracermarks in combination with information
intermediaries and crowd-sourcing are potential legal hacks that
could have profound consequences on ability to govern via
information rather than by mandate. One possible advantage of
this approach is that it would not necessarily involve amendments
to existing public law, whether treaty law or domestic law, but can
utilize the flexibilities in existing IP legal regimes. The platform
could arise through the initiatives of existing private
intermediaries (whether for-profit or not-for-profit) should they
choose to invest in smart information systems. This is already
starting to happen in some sectors.
TIMES (May 20, 2015), http://nytimes.com/2015/05/21/opinion/fair-trade-for-the-global

-garment-industry.html.
151.
See THALER & SUNSTEIN, supra note 14, at 9197.
152.
Id.
153.
Id. at 96.
154.
OMRI BEN-SHAHAR & CARL E. SCHNEIDER, MORE THAN YOU WANTED TO KNOW:
THE FAILURE OF MANDATED DISCLOSURE 18590 (2014).
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VII. CONCLUSION: INFORMATIONFROM DUMB TO SMARTER?

Some claim that IP is becoming largely irrelevant as the
Internet has undermined the logic of false scarcity on which it is
premised.155 One of my core arguments here is the opposite: We
are indeed still faced with scarcity. This scarcity is of a different
kind than the one IP typically addresses. IP has not accounted for
much of innovation and creativity around extending markets for
objective information, although its core concern is encouraging
innovation in general.
Verifiable knowledge is what this Article has referred to as
smart information. Skeptics might ask whether the new
can-opener or untested assumption in this project is the
presumed demand for smart information. Do consumers really
care about credence attributes, or do they mostly want to minimize
the time it takes them to shop for items? Are consumers largely
satisfied with the reliance on price and marketing to give them
relevant information? No doubt, consumers are acclimated to the
current default norms of lack of reliable access to information
about credence attributes. Similarly, firms offering products and
services are used to operating within a communicative
environment dominated by marketing rather than objective
information about credence attributes. This Article has provided
some evidence that many consumers would embrace a much larger
market of smart information than currently available. Firms
might participate more consistently if the infrastructure were in
place and if they perceived competitive advantage from doing so;
some large players are moving in this direction already. Ideally, as
well, the least empowered producers such as musicians and other
creative workers, factory workers and farmers would contribute to
information in the value network, which would allow them to
communicate more directly with the consumers who may care
about their working conditions. This proposal thus has the
potential to shorten the ethical and communicative distance
between consumers and the most distant and typically
disconnected network nodes.
This Article identifies the general lack of attention to innovate
for smart information, which is one factor that stymies the
155.
Lemley, supra note 2, at 507 (The Internet certainly undermines the logic of IP
as an incentive to commercialize works once they are created, but it may also undermine
the classic theory of IP as an incentive to create. Once creation is cheap enough, people may
do it without the need for any IP incentive. This suggests that we should pay more attention
to alternative means of encouraging production, rather than assuming the superiority of
IP. IP will continue to exist in a post-scarcity economy, but it is likely to recede in
importance as a driver of creation. (citations omitted)).
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development of new markets for IP-protected goods. While

information may not be perfect, it can be made smarter than it
currently is, especially if aided and abetted by the very
Internet-based institutions and intermediaries that are
transforming the way we consume IP-protected goods and
services. And whats good for information may also be good for IP.

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disseminate, and ultimately make decisions about previously

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information towards more consistent creation and distribution of

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Taken together, these paradoxes have contributed to a

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solely through hierarchy (top down, command and control

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crowd-sourcing, to create reliable databases of smart

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as copyright and patents.18 The trademark version is that

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these types of goods are evaluated.25 Arguably, information about

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for or to receive this type of information. Arguably, all online

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milling to describe flour not sold directly by grinders, even

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often ruefully acknowledging the ubiquity of corporate hypocrisy

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regulated solely through territorially based forms of public law,

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reviews, creating .sucks websites, or participating in even more

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IV. COGNITIVE CAPITALISM: INTELLECTUAL PROPERTY IN GLOBAL

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streaming of content, storage in digital lockers, and the like.58 The

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markets for IP-protected goods and services take place within a

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quality largely occurs after purchase; even after purchase,

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upstream parties, it is usually not transparent to the downstream

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shape consumer views of product benefits. That is,

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The scholarship examining supply chains offers important

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only as standard-setters but also as conveners and facilitators of

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chain management within the decentralized global setting

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Private regulatory alternatives such as certifications to

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