It has been proposed also to add the statement "a new chemical compound shall be considered useful per se", but that seems to be an undesirable discrimination between chemical compounds and other classes of invention. The purpose can be accomplished well enough by explanations accompanying the proposed change. The important point is that "useful" means operative and is a question of fact and not of disclosure. The other proposed change is to restore the principle existing before the 1952 codification, but in an even more explicit form, that the primary function of the specification is to describe the invention actually claimed. To eliminate the kind of confusion which has resulted from appearance of "useful" in section 101 together with the verb "to use" in section 112, it is proposed to avoid altogether the word "use", which has another legitimate function in relation to certain prior art in section 102 (a) and (b). This change involves a revision of the first paragraph of section 112 along the following lines: "§ 112. Specification (revision of first paragraph) The specification shall contain a written description of the invention, and of the manner of practicing it if a process, or the manner of constructing and operating it if a machine, or the manner of making it if a manufacture, or the manner of compounding it if a composition of matter, in such full, clear, concise, and exact terms as to enable any person skilled in the art to which it pertains, or with which it is most nearly connected, to practice, or construct and operate, or make, or compound the same, and shall set forth the best mode contemplated by the applicant of carrying out the invention. The specification shall also state or be amended to state the purpose or purposes for which the applicant contemplates applying the invention." The words used in the first sentence are chosen with care to avoid ambiguity. Thus "practice" is selected as the verb for a process since it is defined as meaning to make use of, do, or perform, without any apparently troublesome or confusing other meaning. "Compound' is selected as the verb for a composition since it also has no apparently confusing meanings and appeared in previous acts and decisions for over a hundred years. description which should be supplied in the patent under section 112, will permit the Patent Office and the Courts to concentrate on the far more important issues of extent of novelty and unobviousness rather than on this minor issue based largely on the skill of the drafter of the specification rather than on the merit of the invention. 90-355 68 pt. 2 22 STATEMENT OF NATIONAL ASSOCIATION OF MANUFACTURERS ON PATENT LAW REFORM This statement is filed on behalf of the National Association of Manufacturers which is a voluntary association of business enterprises of all sizes and located in every state, dedicated to the promotion and improvement of business and its contribution to society. The statement is directed to what we regard as the central issues of the need for national patent law reform and related proposed legislation. It likewise is intended to emphasize the public, as well as the private interest in the patent system. At the outset, we wish to point out that in times of rapidly advancing technology and expanding world trade, including export of U.S. goods and technology, the need to update our national patent laws goes hand in hand with the desirability of facilitating patent protection of American interests abroad. This will best be achieved by harmonizing international practices. It is with this objective that NAM delegates have represented the Association in several conferences at Geneva with the International Patent Bureaux (“BIRPI") and other public and private world organizations. The meetings have dealt particularly with the pro posed world Patent Cooperation Treaty. CREATIVE FERMENT IN WORLD PATENT SYSTEMS About three years ago, the NAM Patents Committee initiated a series of international conferences on patent matters which brought together industrial property leaders from here and abroad to consider the crisis confronting science and industry and governmental administrative offices. Representatives from developing countries as well as industrialized nations, including the U.S.S.R., have participated in these meetings. We are pleased to report that a spirit of cooperation and accommodation has permeated these discussions, which have centered on ways to relieve the serious burdens facing industrial property offices throughout the world as well as ways to expedite and reduce the cost of obtaining patent protection. We wish to note that underlining our efforts is the aim of encouraging effective research and discovery and invention which will help bring a more abundant life to people everywhere. STUDY BY THE PRESIDENT'S COMMISSION ON THE PATENT SYSTEM The NAM Patents Committee has been keenly interested in the events leading to the Report of the President's Commission on the Patent System and the subsequent legislative proposals. We consider this a profound undertaking to evaluate the present system and to propose constructive changes in the interest of the public as well as inventors. Immediately following the release of the Commission's Report, the NAM passed a resolution applauding this sincere effort to propose improvements consistent with present needs and the requirements of decades ahead. NAM likewise has held meetings to promote public undertanding of the issues and the recommendations of the President's Commission. PATENT REFORM When the NAM Patents Committee reviewed H.R. 5924, it directed attention to what it considered to be the highlights of the bill from the standpoint of importance to industrial organizations, as well as the public interest. FIRST TO FILE, PROPERLY QUALIFIED CAN BE HELPFUL TO THE INVENTOR AND THE PUBLIC In its deliberations, the Committee raised serious questions over any allencompassing acceptance of "first to file" inventors as patentees (Sec. 102). Nevertheless, in recognition of the benefits to all from early and correct information, support was voiced for exploring solutions which might retain desirable features of the "first to invent" basis and combine them with valuable aspects of the "first to file" system as an imaginative step in its own right as well as a move towards international harmonization and cost reduction. We believe that positive consideration should be given to the proposal being made by the Department of Commerce and Patent Office spokesmen and others to adopt a limited "first to file" approach which would nevertheless permit subsequent applicants to contest the issue of priority and to establish dates of invention not more than a limited time prior to their effective U.S. filing dates. This approach may well encourage prompt disclosure and promote early use of new technology. Moreover, it should lessen the fears of hastily-prepared or incomplete submittals arising from a strict first-to-file rule under which patent applications might be filed before proper information was available to permit complete and correct disclosure. PRIOR ART-ONLY AS BROAD AS SEARCHABLE With regard to openly extending "prior art" to include knowledge, use and sale in foreign countries (Sec. 102), we hesitate in support of this proposal outright. The near impossibility of operating under such a standard, and the expenses involved, and the fact that this would not really coordinate with practice abroad should be considered. Nevertheless, we are sympathetic to the view that this country should work with other nations in defining a universal standard of prior art which ultimately might be adopted everywhere. PUBLICATION-AS EARLY AS FEASIBLE The matter of arbitrary publication of applications, i.e., prior to issuance of allowability of at least one claim, caused some concern in the NAM group (Sec. 123). An inventor, of course, is reluctant to have his invention revealed to the public before the scope of his protection is determined. On the other hand, we do favor the earliest feasible public disclosure in consideration of the public interest in order to have fresh technological knowledge in the stream of research. For these reasons we have been pleased with administrative events in the Patent Office that would assure publication of most applications after 24 months of filing. This applies equally to any need for standby deferred examination authority (Sec. 191). We are, nevertheless, sympathetic with a notion that mandated publication may be desirable in situations involving protracted proceedings, as when an appeal would delay final decision. PATENT TERM TO DATE FROM FILING The NAM has long advocated enactment of legislation in accordance with Sec. 154 calling for a twenty year patent from the date of filing. We feel that it is in the public interests as well as to the benefit of applicants that patents be issued as soon as possible after applications have been filed. This would help diligent prosecution practices generally. However, in appropriate cases an additional period of time should be allowed to overcome delays due to circumstances outside of the applicant's control. PREVENTION OF INFRINGEMENT BY IMPORTATION We are also in general sympathy with the proposal of Sec. 271(b) relating to importations. We recommend that the section might be strengthened by wording it as follows: "Whoever, without authority of the patentee, imports into the United States a product made in another country by a process patented in the U.S. shall be liable as an infringer." Both the public and patentees would find this beneficial. Any narrower approach to the import problem seems to interject unnecessary difficulties while lessening benefits to U.S. inventors and those who have supported them. FEES COMMENSURATE WITH SERVICE With regard to administrative financing (Sec. 41), we believe Patent Office fees, fixed by Congress, should be consistent with the principle that each fee relate to the cost of providing the service to which the fee applies and that the general public should bear a fair proportion of the cost of operation of the Patent Office. We do not favor imposition of any levy on patents subsequent to the date of the grant. HARMONIZATION OF U.S. PATENT PRACTICE WITHOUT LOSS OF QUALITY As a general observation on a world patent approach, we advocate that to the extent that harmonization of U.S. practice with prevailing foreign practice can be attained without injury to the quality of the U.S. patent system, such harmonization should be introduced as a step toward the desired goal of the international harmonization of patent practice. Where, however, U.S. practice appears to be superior, we recommend that appropriate federal agencies make efforts to secure harmonization compatible with U.S. practice. CONCLUSION We are pleased that efforts are being made to develop immediate and long term means for alleviating the serious difficulties confronting patent offices all over the world including the United States. We endorse the objectives of making information available to all-inventors, researchers, entrepreneurs, and the public as early as feasible. This, we feel, will avoid waste and duplication and at the same time stimulate development. In addition, we approve efforts taken to facilitate patent protection abroad as a means of increasing export of U.S. goods and technology. Revenue from such exports is significant to national as well as private interests. U.S. Department of Commerce statistics show that American companies receive payments from abroad for the use of intangible property-largely patents and know-howin excess of $1 billion annually. This plays a very important role in our balanceof-payments account. Because we believe the U.S. patent system to be a major contributor to progress of the American economy, we support the efforts being made to bring this system into accord with present needs, domestic and international. The nation must take the steps necessary to encourage sound industrial property administration abroad as well as at home. The opportunity for representatives of industry to participate in these discussions is appropriate and warmly welcomed. STATEMENT OF NATIONAL PATENT COUNCIL Hon. R. W. KASTEN MEIER, NATIONAL PATENT COUNCIL, INC., Acting Chairman for Patent Law Revision, Rayburn House Office Building, DEAR MR. CHAIRMAN: National Patent Council, Inc. opposes the so-called Patent Reform Bill, H.R. 5924, as introduced and the subject of hearings by your Subcommittee, because it would load the dice against one of the most potent innovating forces in our economy; the initiative and drive of the independent inventor and small businessman. It should be recognized that, in our present economy, the independent inventor who is successful often becomes the small businessman. The independent inventor's urge to obtain recognition for his ideas and the entrepreneurial drive of the inventive small businessman contribute relatively more to the forces of innovation in our economy than do the research efforts of large corporations. This innovative force would be crippled by the restrictive changes in our present patent system proposed in H.R. 5924. The changes proposed in H.R. 5924 have been justified by the bill's proponents on the basis of a hoped-for increase in Patent Office efficiency, the will-o'-the-wisp of conformity to a non-existent international patent system, and fancied advantages to the independent inventor. However, many harmful effects would flow from the enactment of H.R. 5924, including: 1. The elimination of the grace period.—The independent inventor often has a variety of possible alternative solutions to a problem. He usually can distinguish between the valuable and worthless solutions only by testing these solutions. However, market or service testing an invention generally involves public use. Without a grace period, he must file on all the solutions prior to testing in order to protect himself. This not only places a financial burden on the independent inventor but increases the work of the Patent Office. Large corporations can absorb the additional expense with little effect upon their profits. 2. The "preliminary application."-The right to file a "preliminary application" [Sec. 111 (c)] is not an advantage to the independent inventor but a ghastly trap. Since priority rights are limited to the completeness of the disclosure of the preliminary application [Sec. 120(a) (2)], it is obvious that the preliminary application must be prepared with the same skill and care as a complete applica |