Timothy B. Lee has a great article on Ars Technica about the struggle to apply copyright law in modern times. Frankly, intellectual property law is not scaling well with today's technology. The US Congress is presently in the middle of a major patent reform project which I daresay will not deliver from the moment it's put in effect. Copyright rules have been moving around constantly, with the MPAA and RIAA doing all they can to go after "illegal" file sharing.
If you're interested in the subject of copyright, and you should be if you're interested in open source, I highly recommend Free Culture by Lawrence Lessig. This book opened my eyes to the problems facing all sorts of industries because of various unintended consequences of the current copyright laws. One of the key points in the book is that because today's current copyright law recognizes that all creative works automatically receive copyright protection for the life of the author plus a large amount of time afterward, virtually everything in modern life is copyrighted and therefore is subject to a grant of permission before it can somehow be recycled into another work.
This idea that culture builds on the culture of a few years ago, recycling it and re-synthesizing it into something new and modern is important. An obvious example is a redramatization of an old story plot into a new movie or book (reusing plots from Greek tragedy, for instance). In music, it's about resampling and remixing to create something new (Vanilla Ice swiping the Queen "Under Pressure" baseline for "Ice, Ice, Baby"). Think about movie and television shows that must "clear" copyright on just about every image or sound that is shown. This world is only getting more complex by the day, and it's hampering the world around us, often for no good reason because most people don't care about the copyrights they are granted automatically by the law. Sometimes it's impossible to find out exactly who owns a given copyright and so it's impossible to reuse that material legally.
Free Culture does a great job describing some of the problems and suggesting reform that would at least mitigate some of the problems.
Now, what does this have to do with open source? Well, all open source licenses (the GNU Public License, BSD license, Mozilla Public license, etc.) basically rely on copyright law for their enforcement. The primary difference between the GPL and code that is in the public domain (uncopyrighted), for instance, is that the GPL can grant a set of rights, subject to a set of proscribed responsibilities, to a distributor of a product that uses the code. Public domain code can be used for any purpose whatsoever and effectively nullifies the GPL's "viral" nature that forces you to release your code. You can combine public domain code with your proprietary code and it effectively becomes proprietary.
Now, in a world without copyright, you could use anybody else's code for any purpose and you would not have to release your own source. But once your own source got out, you could not stop people redistributing it or using it for any purpose.
It's an interesting thought experiment to think about what would happen if all intellectual property law was simply abolished. No more copyright. No more patents. No more trademarks. I'm not sure I'm ready to go to that extreme, but it's very clear that even laws that "worked" in the 1970s are no longer able to deal with the environment of 2008. But changing these laws will create tectonic shifts of power and money and so the wheels of progress move slowly.
Buy yourself a copy of Free Culture and expand your mind.