item is in the bill, is that by various kinds of stratagems the patent attorneys delay the prosecution of the patent application. If the patent laws are well written and if they are clear, and if the Patent Office does what it is supposed to do, which is to enforce the law, there is no way for an attorney to stretch the pending period. If he does, it means that somebody is being lax and lets him get away with it.

It seems to me that if patents are going to get issued in a year or two, let's keep the 17 years from the date of issue. There will be interferences in important patent cases, there will be certain difficulties of one kind or another and there is no reason to penalize the inventor. To say that the attorney is going to be penalized is really to say that the inventor will be penalized, because the attorney speaks for the company or the inventor. I see no reason why you should introduce this sort of thing. The Patent Office should see that the attorney minds his P's and Q's and they should see to it that he cuts out the nonsense. I think that 17 years from the time of issue is good, but I don't think this change is going to make very much difference in the average practice.

I don't like the provision that the fees be set up by the Patent Office, and not because I don't like Commissioner Brenner. I think he is a wonderful guy. I think that it should be Congress' business to keep a check over the agencies, and this is one way you have control over the agencies by making sure you have control over their money. This is a very powerful weapon. I was in the Government for 16 years. I think it is necessary for Congress every year to take a look at what Government people are doing via the Budget Bureau. It has a tremendous power in Washington because of the dollars that you hand out to the agencies. I think the agencies should be looked into this way.

The thing I object to greatly is the presumption of correctness of the Patent Office staff. The staff is getting weaker, not stronger. They are having trouble maintaining their best people. The salaries are not equal to the salaries of the outside attorneys. There is a kind of presumption of correctness on their part, but there are ways of correcting their decisions as to what is new and what is obvious after the argument with the inventors. I think that no presumption like this should be written into law. Let the courts decide this. If the Patent Office has a good staff, and I shall have something to say about this at the end, and the staff is competent, the presumption of correctness should be automatic. You don't say a man is intelligent because the law says so, let him be intelligent first and thus get the respect he deserves.

I don't like the degrading of the CCPA by having the proposed appeal procedure over this court. I think that the court is excellent. We recently had a meeting in New York of some of the best patent attorneys working for the large corporations in America. There was a meeting about this patent bill at the New York Hilton about a month ago, held by the American Management Association, and I asked the attorneys who were present-I have a list here if you would like to see it-"Do you think the CCPA hands down good decisions, would you do any better if you were in the judge's seat?" And it was unanimously held by a show of hands that this court is excellent, their decisions fair, and that the attorneys do not think any other court does any better.

My own reading of their decisions, and I read the Patent Gazette every week from cover to cover, leads me to think that you could not

improve on this court as a court of review for the Patent Office. I think any tendency to overrule them or to let some other court-outside of the Supreme Court-review their cases is unfair and unnecessary. In fact, the present system of being able to appeal against the Patent Office either in this court or in the district court of the District of Columbia, should be modified. I think that the district court should be eliminated from the patent business and that the CCPA should be the only court where you can take an appeal from the Patent Office. This would simplify the procedures, save money and in general clear up this business of giving the attorneys two alternate routes by which they can go through the court.

I object most violently to the provision in the bill which says the Patent Office, itself, can revoke the patent within 3 years. I don't know who stuck that into the bill, but if there ever was a dirty trick against an inventor, this is it. Here is a case where I apply for a patent on the first-to-file system. I have trouble getting the patent issued because the application has been published. Other people have a chance to speak their minds, they have 6 months or a year. I finally get over that. I get my patent issued in spite of all those things. Suddenly I have a patent so I begin to spend money.

I develop a gadget and sell it, the money may go into a million dollars for a reading machine or $50,000 for a venetian blind. My competitor waits 21/2 years and suddenly clobbers me with art that he knows. In a tomb they just opened in Greece they found some prior art. The patent is not valid. There is prior art because somebody used the invention in a mine in Africa. Suddenly the Patent Office is forced to negate its own decision and throw the patent out. I cannot sue this man for infringement at the same time. If he goes to court later and fights me on validity, at least I can countersue and say he is infringing. So he can sue me on validity and I can sue him for infringement and we can let the court decide the equities of the matter. But here he's not under any risk himself. He goes to the Patent Office and throws out my patent by paying a "big" fee $500. To a large corporation, even to me, that is not big money when infringement is concerned. Five hundred dollars doesn't mean a thing when you have an infringement case where you would like to manufacture the article.

Mind you, the man deliberately kept quiet when the application was published before issue. Nothing is said in the bill that he had to come in with prior art. He kept quiet, he let me get the patent, he knew what I was doing, I even opened a market for him, and then he clobbers me with art that he knew about all the time. I think this is ridiculous. Once the Patent Office has done its job, the application has been published, the patent issued, that's it. The Patent Office should be finished. Let the man go to court and we'll fight it in court. I don't see how the Commission could recommend this and say they are trying to strengthen the patent system. During the 3 years I can't even sell the patent because I don't know if someone will or will not clobber me. I don't understand this thinking of the Commission. I beware of friends who try to protect me much too much.

Now another thing I object to most violently in this bill is the provision that says that if the patent goes to court and a judgment of validity is handed down against the inventor, and it is appealed and the judgment is sustained, that the patent is invalid for all time.

I would like to know why the reverse isn't true. Why, if it is held valid when it was tested, and it was appealed and held valid in the court of appeals, why shouldn't it be incontestable from then on? If the court decision is good for an infringer, why shouldn't it be good for the inventor? I am perfectly willing to go through the courts and settle it. If it is held valid, why can the infringer sue me a hundred times while I can sue only once? It seems to me that if you are going to introduce this kind of thing into the law, let it say that after it has gone through all the possible appeals and has been held valid, let it be valid for all times. That's usually another 10 years, or 5 years, or whatever is left. But let the proposed law not always be biased against the inventor.

I object to the deferred examination system because I think basically, it is a way of saving the Patent Office work by abandoning patents. Because if they are not abandoned, the Office will have no less work. You file a case and you defer it, and a little later somebody else comes in or you come in to pay the final fee and the Office has to prosecute the application as before. It seems to me that the case of my application at the Patent Office should be between me and the Office and no one else. I object to the fact that I can have 30 cases pending on deferred examination and then my competitor, let's say he is a rich competitor, comes in, pays the fees. Suddenly I find I have to prosecute 30 patents all at one time, when I am not ready, when I can't afford the $500 that each case would take (at least). Suddenly my competitor forces me to prosecute patents which I was deferring. If we are going to defer patents, first of all, no third party should come in. This is none of their business. While I prosecute my application, they know the details of the case because it has been published.

The whole deferred examination is a myth and in no sense is it going to save me any work. My attorney still has to prepare a complete application. I think it is basically a way of publishing rather than issuing patents and I think that ordinary publications can be used instead of this. I think it is unfair to the small man because the small man will think he is going to save money. It is the kind of system where you file now and pay later-a credit system. Some have said to me: "After all you are a grown man, you know whether you want to prosecute the thing or defer for later." I say that is an argument for gambling. Grown men gamble, grown men take heroin, this doesn't mean you should encourage this. I think the proposal is an encouragement to file and not pay.

In the case of my watch regulator if I had filed and not been able to sell the invention for 5 years, I would have abandoned it. As it was, I sold it 9 years later because the watch industry wasn't interested. The automobile industry was.

With the deferred examination you are encouraging abandonment. This is the reason I object to maintenance fees because they force the inventor to abandon applications. I object to anything that does this to the inventor. Let him pay when he is interested and be done with it. Let him get a patent. Don't make it harder and harder as the years go by. Seventeen years go fast enough.

I object to the whole business of deferred examination and I certainly object to it being instituted by either the Commissioner of Patents or the Secretary of Commerce. It should be your job, gentlemen,

to decide when the patent system gets changed. Let other screwball inventors come in and testify. It is your job to decide when the system should undergo changes, not somebody who wants to save on help and who doesn't know how to get more money from you. That is a problem, I admit. His job is to get the budget from you and if he cannot get the necessary budget, then he is going to ask you for changes in the patent system. He could even ask that you repeal the patent system, but that should be the Congress' duty, not the duty of the Commissioner of Patents or of the Secretary of Commerce.

I think that the patent system should be upgraded but you don't upgrade it by changing the laws in this way. These are merely legal matters. The way you upgrade it is to upgrade the people who administer it. This means you want better patent examiners, you must have more of them, and you should have more professionalism down there. Now they have to get so many cases done by Friday. I believe that what you should do is raise their salaries. There is no way of getting good people without paying them enough, except for Congressmen, Secretaries, and the President. They will work for nothing, but everybody else seems to want to get paid for their work. I think it is important that they get well paid for it.

If industry pays attorneys more money, then Congress will have to pay examiners more money. You will not get good patent examiners without this and unless you get good people, you are not going to have a good patent system. It does not make any difference what laws you write, the only way to get good people in a job like that is to pay well. You want good inventions-give the inventor the present 17 years; you want good examiners-pay them a good salary.

There are other patent bills that could be written which are not as radical as this, such as the bill before you, H.R. 7454, which is a rather straight forward bill to simplify the present patent system. This is an excellent bill which does not change the basic laws of the country.

We could write a million bills but I support the first to file only because I believe in international patents. I don't believe the present bill is particularly good and if I had a choice of letting it be passed completely as is, or abandoning the international prospect, I would abandon the international prospects. I believe the present bill is very unfair to the small companies, to the small inventor and unfair to all inventors, and I urge you not to pass it and not to recommend it in the present form.

And I want to thank you very, very much for listening to me.
Chairman KASTEN MEIER. Thank you Mr. Rabinow.

I have just one question in view of the lateness of the hour. As an inventor is it your practice to pursue your own patents, or do you and have you exclusively used patent attorneys?

Mr. RABINOW. I have done both. We have a patent attorney at Rabinow Engineering. He has enough work because we emphasize patents. He works with us directly. I also have a private attorney because, occasionally Control Data lets me have some private rights on inventions which are outside their business when and where they feel they are not interested. And to keep the matters clear, I like another attorney to handle this. He does it on a commission basis. He has done well with

me so far, and he says some people play horses, he prefers to play Rabinow. That is his privilege. I have done my own cases completely. That is, I have written the specifications, the claims, and actually had the interviews with the examiners. But it usually does not pay to do this because often there are things you do have to know, particularly if you get involved in any difficulty. I prefer not to do it now. We don't even make our own searches, we use professional searchers. I think an inventor can file his own patent in simple cases. If you have a simple pair of pliers you can do your own, but if you have invented something complicated you have to use an attorney. Incidentally this is why the $10 fee doesn't trouble me. It is going to cost you $500 to get a patent through in the simplest case. So whether you pay $10 or $30 or $60 isn't going to make any difference to an inventor. I am not going to stop filing because of a $30 difference.

Chairman KASTEN MEIER. You did open up another question. The witness that preceded you stated that the holders of large portfolios of patents are reaping the greatest amount of benefits from patents and should therefore bear a large portion of the total fees paid to the Patent Office. He recommended that a graduated structure of fees related to the total number of patents held or filings made, per annum, be incorporated into the fee structure. As a holder of a large portfolio of patents, what are your comments?

Mr. RABINOW. Well, my portfolios are not large compared to some large companies, because they hold thousands of patents. I think if they have large numbers, they paid more to the Patent Office, any way, and I don't think it would make any difference if you change the fees from $50 to $100. Even if they have to pay a maintenance fee when they file in Europe, I don't think it is going to make any difference.

The large companies, the IBM's, the General Motors, the General Electrics do license freely and they do not prevent the little inventor from making the patented article. I know of no case where a large company clobbers a little guy and I think this is because of the antitrust laws which are most effective. Large companies do have large numbers of patents but the protection that they need is internal. They do make a lot of money on their inventions but not by royalties.

As a matter of fact, one of the gentlemen from one of the largest corporations-I don't want to name any names-said that if the patent system were ended today these larger corporations would go on making their generators and their computers and everything else perfectly well without a patent system for a short time. After that the flow of inventions would start drying up. General Motors will make cars with or without patents, certainly in the immediate future.

Chairman KASTENMEIER. Mr. Edwards?

Mr. EDWARDS. No questions.

Chairman KASTENMEIER. Mr. Hutchinson.

Mr. HUTCHINSON. No questions at all, except I want to compliment the witness for what I feel has been a very helpful testimony. Mr. RABINOW. Thank you very much.

Chairman KASTENMEIER. The Chair would also like to thank you for your very helpful testimony.

The Chair would like to announce that we have an executive meeting on Monday morning next at 10:30.