Mr. MARTIN. Abandonment is defined as disuse for 2 years. I think it is something like that. Mr. FENNING. Or intentional abandonment. Mr. ROGERS. That is a term that has been pretty generally construed, "continuous use." . Mr. LANHAM. Has that been judicially construed several times, "continuous use"? Mr. ROGERS. Yes. It means such use that keeps the mark before the public mind in such a way that it is not forgotten. That is really what it means. Mr. FENNING. That is what they are trying to say. And remember, if you will, that the whole purpose of this bill is to abolish everything which has ever been interpreted and use a new term. Mr. LANHAM. But the term "continuous use," I understand, has been in vogue for a long time, and the judicial construction has pretty well settled what it means. Mr. FENNING. Then it should not be used without definition. Mr. LANHAM. If we are using it in the same sense that the courts have construed it, that would be satisfactory; would it not? Mr. FENNING. Yes; but this definition ought to be that. Mr. LANHAM. Then I think it would be well to insert in the hearing here language which is a disclosure of the legislative intent, that it is the intention of this committee that the term "continuous use" is employed here in its usual connotation, as under judicial construction. Mr. SAVAGE. I think it should be left out, because we all know what it means, and the more defining we put in the more inflexible you make the bill. Mr. LANHAM. Yes; that is the reason I was suggesting this statement in the hearing, that it is to be determined in accordance with recognized judicial construction. Mr. SAVAGE. We should leave something to the courts. Mr. LANHAM. Yes. Mr. ROGERS. Mr. Chairman, there is a question in my mind whether this bill as now prepared provides for an appeal from decisions of the Commissioner to the Court of Customs and Patent Appeals, and for review under section 4915 in cases arising affecting marks on the supplemental register. I think it was the intent of everybody that there should be such an appeal, but there is nowhere an express provision to that effect. Mr. FENNING. Section 21 provides for that, and section 26 provides that the provisions of section 21 shall apply. Mr. ROGERS. The difficulty that I see with that is that section 21 is under the chapter dealing with the principal register. My suggestion would be, so there could be no possible doubt, to insert in section 26, page 23, after the word "act," line 13, the followingMr. LANHAM (interposing). You mean line 23? Mr. ROGERS. I beg pardon. Line 17, page 23. Mr. LANHAM. You do not have the committee print; do you? It is line 17, page 23. Insert after the word "act", the words "including the right of appeal and review." Mr. FENNING. That is wholly unnecessary. Mr. LANHAM. "As provided in sections 20 and 21 hereof”? Mr. FENNING. You notice line 22 specifically says that section 22 specifically applies. Mr. ROGERS. By not mentioning it, I had to go to the Supreme Court of the United States to find out if an appeal was provided in the act of 1920, because there were questions of repeal by implication, because there were references from one statute to the other, and if that is put in as I suggest, there cannot be any question about it. Nobody will have to go up there again. Mr. MARTIN. Mr. Rogers, the fact that you include those two sections-might there not be an inference that those are the only two that are included? That is what bothers me. Mr. ROGERS. Then leave out reference to sections 21 and 22. Mr. MARTIN. Certainly it was the intention to give the supplemental register the advantage of all the sections of this act except the ones which were specifically excluded by name, and certainly 20 and 21 were intended to be given. I do not object to citing them expressly, provided we do not thereby exclude the rest of them. Mr. ROGERS. As long as there isn't any possible doubt about it, I suppose it might be all right. Mr. LANHAM. It is only in sections 20 and 21 that those provisions appear? Mr. ROGERS. I think so. Mr. BAILEY. Mr. Lanham, I do see one point in Mr. Rogers' statement, and that is that section 26 as it stands now does not apply to applications for registration on the supplemental register, but only to registrations. In other words, would it not be better in line 18 of page 23, after "applicable" to insert "applications for registration and"? Mr. LANHAM. Insert what? Mr. BAILEY. In line 18, page 23, of the committee print, after the word "applicable", insert the words "applications for registration and.” So that it will read: The provisions of this Act shall govern, so far as applicable, applications for registration and registrations on the supplemental register. Mr. LANHAM. "Applications for registration and registrations on the supplemental register." Mr. FENNING. Then, in line 20, after "registrations," insert "and registrations." So that applications for registration and registrations on the supplemental register, and so forth. Mr. LANHAM. You mean to put that in in addition to the amendment suggested by Mr. Rogers? Mr. BAILEY. I do not see the need for Mr. Rogers' amendment, but I was wondering whether that would not take care of it. In other words, as it reads at present Mr. LANHAM (interposing): The provisions of this Act shall govern, so far as applicable, applications for registration and registrations on the supplemental register. That would obviate the necessity of the one you suggest, Mr. Rogers? Mr. ROGERS. I think so. I just do not want the rest of the profession to be caught as I was. Mr. HANDLER. Mr. Chairman, at the conclusion of this morning's session you said Mr. LANHAM (interposing). Let us get to this trade-mark business first. I just want to get through with what I have here before me, and the things that I have here in the way of endorsement we can insert in the appendix. This is from the Federal Trade Commission, dated October 31, 1941, addressed to the chairman of the committee, Mr. Kramer. The first paragraph acknowledges receipt of the chairman's letter advising him of these hearings. This is written by W. T. Kelley, chief counsel of the Federal Trade Commission. He says: I should like to draw your attention to a report by the Federal Trade Commission on S. 895, the companion to the bill, H. R. 5461, which is under consideration by your committee. In this report the suggestion was made that section 15, the so-called incontestability clause, be stricken in order that the Federal Trade Commission may continue effectively to exercise its jurisdiction in preventing unfair methods of competition and unfair and deceptive acts and practices insofar as trade-marks are concerned. The suggestion was also made that a section be added to the bill providing that nothing contained therein shall be construed to affect or limit the jurisdiction of the Commission. In view of the various fundamental changes in trademark law besides the feature of incontestability made by the bill, including a prohibition against registering deceptive marks, I feel that such a proviso should be added to H. R. 5461. In the bill which is before your committee, the clause which makes a registrant's right to use his trade-mark in commerce incontestable after a specified period (section 15, lines 6 and 7) has been modified by various exceptions. These exceptions, however, only pertain to rights and remedies under the trade-mark laws and do not cure the defects found in the Senate bill insofar as the Federal Trade Commission is concerned. I feel that the safest way to avoid all doubts this section may raise, concerning the jurisdiction of this Commission, would be to strike the clause altogether. If for any reason this is not done, may I suggest that the Commission feels it is imperative that the sentence at least be modified to read as follows: "The right of the registrant to use such registered mark in commerce shall be incontestable for the purpose of any proceeding arising under the trade-mark laws." That suggestion has come from the Federal Trade Commission.1 Mr. LOUIS ROBERTSON. I might say, Mr. Chairman, in that connection, that this matter of incontestability should be looked at from two aspects. One is the registration law, which undoubtedly has not been satisfactory. The other is the substantive law, the right to use, which is called common law but is really equity, fairness. No mark which has needed protection heretofore has failed to get protection under equity. The Dyanshine case did not need to be made incontestable, because it had a natural right to protection. Section 14 provides the correction to the registration law that has been talked about quite a bit. Section 14 provides that the registration shall not be canceled. Section 15 is not necessary to that end. I think that section 15 is bound to cause a great deal of trouble and should be canceled. Mr. SAVAGE. Mr. Chairman, I would like to be heard very briefly on that question-and I am speaking now for the National Association of Manufacturers. These are not my personal views that I am expressing, and my personal views may coincide with these or may not, but I do not know of a single member of our association that has expressed a view at all on this trade-mark bill who has not said that the most desirable feature of it is the provision for incontestability. Manufacturers want to feel secure in the use of their marks, and after they have been on the register for 5 years they do not want to have their right to continue to use those marks upset, and if you strike that 1 Complete letter printed in appendix, p. 219. out I think you lose practically all of the support of the manufacturers throughout the country of this bill. Mr. LANHAM. I will say very candidly that so far as I am personally concerned I am quite strong for it. I believe it is analagous to the statute of limitation with reference to other matters, that there ought to be some time when a man can feel secure in his business. Mr. LOUIS ROBERTSON. Mr. Chairman, I would like to speak, if I may, on the point of the effect of incontestability from this chart. [Producing charts.] 1 1 This does not relate to the effect of incontestability in connection with section 14, which is harmless when applied to the registration law. This shows the effect of incontestability in connection with section 15 and section 34 (b), which is correlated to section 15. First let me explain that I do not have any clients for whom I appear here, or elsewhere, that are concerned with this problem. I have no clients to whom I can charge the expense of making these charts. I am speaking on behalf of the thousands of small businessmen who now have small businesses within a State, and many of whom hope to grow throughout the country and many of whom will grow throughout the country. Let us assume that in 1938 one of these small businessmen started up in a small way in Texas. By 1941, when the Lanham bill passes, he has a pretty valuable business, but still within the State of Texas. Back at the time when he started, perhaps he registered his mark in the State of Texas. In 1941, when the Lanham bill passes, he is still in local commerce and has no right to register, unless the bar association's section 29 is inserted, in which case he has not a right to register but merely a right to deposit. But if he has no right to even deposit, then there is nothing in the Patent Office files that will keep the Patent Office or even tend to keep the Patent Office from granting a registration on a similar mark to someone else. If, shortly after the Lanham bill passes with section 15 in it, a corporation starts a synthetic use in the District of Columbia and registers the mark in the District of Columbia, registers the mark in the Patent Office because of this synthetic use, it will ultimately acquire an incontestable right to that mark. There may be no real, valuable use prior to that time. I explained synthetic use a while ago. It is not a fictitious use. It is a real use. The articles are actually sold. The manufacturer or trade-mark corporation, as I have called it here, has a regular procedure. Most trade-mark attorneys have a regular procedure, I believe, for maintaining these marks by synthetic use. They have a vice president, say, that gives instructions for someone to apply the label with the particular trade-mark in question to goods which go out in the usual channels, usually to some one dealer or jobber, sometimes to jobbers throughout the country, to be sure that they have Nation-wide rights, but very often, and usually, without any request by that jobber for that particular item to be sent. That type of use, if it is maintained continuously, under the bill will apparently provide incontestable rights, and that registrant will, after incontestability, be able to take over the rights of the small person who started up in Texas. Now, let us assume that in the meantime the 1 Photostats of charts in committee files. man in Texas has expanded gradually, as his means increased. He expanded throughout the country and has a valuable business, worth thousands of dollars, extending throughout the country. That would be of no help to him whatever when the mark was made incontestable to the registrant on the basis of synthetic but real, continuous use. The registrant would have the right to take over the entire thing, that valuable business in territories in which that business was expanded, when the registrant's mark was completely unknown there. In this territory where this mark has been used for several years the public knows that mark only as the mark of Mr. John Small in Texas. When incontestability takes over, when the registrant on the basis of his continuous synthetic use is given incontestability and given that territory, he gets that value, which he has no right to. He has done nothing to deserve it, to create that value. He merely has a paper registration and a synthetic use. The synthetic use may be confined to the District of Columbia. It does not even need to be interstate commerce, because the commerce in the District of Columbia is commerce under the control of Congress. Now, it so happens that the registrant's rights are, theoretically, preserved in the State of Texas, because at the time of the registration by the registrant, or at the time of the passage of the bill, he had rights in Texas. His mark was not known elsewhere, however, and so, under the common law-at least, as interpreted in most States, I believe there may be a few decisions to the contrary-he has no right out here where the mark is not known, but he does have the expectation of expanding. I thoroughly agree with you that this man should have registered his mark when he expanded into interstate commerce. There certainly would be no objection to providing a small penalty for anyone who does not do so, but do not take away his whole business. Do not take away everything that he has built up in the course of several years. It is not just. It is not fair. And yet the courts will have to do it under the Lanham bill if section 15 is included. Now, there is a peculiar thing about this local situation in Texas, where, presumably, the Lanham bill preserves his rights. Mr. Martin has said, I believe, that the State statute does not interfere with interstate commerce; that it stops at the State line. If that is true, and if it is made more certain by the inclusion of the intention clause, which was discussed a while back-the intention to prevent State legislation from interfering then there is no way that Texas can keep the registrant from coming into Texas, because the Texas law, according to Mr. Martin, cannot stop him, and the Federal law does not give him any right to stop the Federal registrant. Mr. PLAUCHÉ. You mean to say, Mr. Robertson, that a man or this particular individual that you have referred to, had no right under the law to register his mark when he started business in Texas, even though he had intended to go into interstate commerce? Mr. L. ROBERTSON. Absolutely none under the law. Mr. T. E. ROBERTSON. Except under section 29. Mr. LANHAM. Once it got into interstate bsuiness, then he could. Mr. L. ROBERTSON. Yes; and there would be no objection to a reasonable penalty for him not doing so, incidentally, the public is an innocent bystander, and yet the public may be grossly deceived. It may be accustomed to a very high quality under that mark, and when |