In December of last year Dr. Radau, who is here today, and who happens to be an old law-school classmate who graduated with me, whom I have known for a great many years, and who has been a member of the Chicago bar for 25 years, called on me and told me that he was interested in the matters concerning which I had introduced these two bills. He explained about the people he represented, and he also asked me if I could assist him in any way in introducing a bill on the same subject matter.

As a lawyer, one hesitates sometimes in representing conflicting interests, but I felt that as a Congressman I was, perhaps, in a little different situation. Still I did not want to do anything that might be embarrassing either to myself or anyone else, and therefore I wrote to Mr. Hintzman, at whose request I had introduced the bill before, and explained to him that Dr. Radau had been to me and asked me to introduce a bill; and just for the benefit of the committee I will read just one paragraph in a letter which Mr. Hitzman wrote to me under date of December 19, 1939. He states:

Dr. Radau represents people who have interests similar to those that I represent, and I will consider it a favor if you will assist him in any way that you can. I know that you gave me every possible help that you could while I was working on the matter, and I am sure you will do the same for Dr. Radau.

Now, I think it would be taking a great deal of the committee's time if I were to attempt to explain this bill. Dr. Radau is very familiar with the details of it, and there have been several matters of litigation in connection with the subject matter. Dr. Radau is here, and I believe it will be conserving the time of the committee and of all of us if I yield at this time to Dr. Radau and let him explain the situation to the committee.

Mr. EDELSTEIN. We will be glad to hear him.

STATEMENT OF DR. HUGO RADAU, CHICAGO, ILL.

Dr. RADAU. Is there anything this committee would particularly like to have about the type of litigation or anything? If so, I would prefer if the committee would be kind enough to shoot questions at me so that I could answer them.

Mr. EDELSTEIN. The committee is familiar with the purpose and the object of this bill, and that is all that we are interested in, and what it seeks to accomplish.

I want to say that we have read the petition that has been filed here with a large number of signatures supporting the bill, and having read the petition we understand what is sought to be accomplished. Now, have you anything to add to what is contained in the petition? Dr. RADAU. I think from your saying that you are referring to a petition with a large number of signatures on it, that petition is no doubt the petition of Mr. Hitzman. I do not represent Mr. Hitzman as such, although I was very much pleased to hear from Congressman Reed that Mr. Hitzman expressed such favorable views about it. I represent Mr. Steve Kalisz and Stella Lakomski, who are the owners of five patents originally issued to Elbert R. Robinson, deceased. We refer to them as the Robinson patents.

The reason why they got hold of these patents was because Hitzman and his group, if you will pardon me, or his society, started certain litigation in the Federal court for infringement of these

patents. One suit was brought in equity against the Chicago Surface Lines, then being in the hands of a receiver, Mr. Blair being the receiver, and the other was brought against the American Car & Foundry Co.

In all of these bills Mr. Hitzman, and for that matter, also, former Senator Lewis, set up that Mr. Robinson, and his wife, borrowed certain sums of money for the purpose of carrying on this litigation and issued to these people certain notes, telling them that these notes constituted also a first mortgage on his patent. On the strength of this so-called oral or verbal mortgage to the members of the Hitzman group they started these proceedings for infringement of the patents. They lost out in the lower court, and Judge Wilkerson at that time wrote an opinion that, on the basis of this claim of having a mortgage they could not possibly bring a suit for infringement because that mortgage, if there was any, could not be proved, being verbal. They were not satisfied, but took an appeal to the circuit court of appeals, and the result of that appeal was the same. They sustained the findings of Judge Wilkerson in toto. Do you mind if I read a part of the decision?

Mr. EDELSTEIN. To save time you can just give the citation in the Federal Reporter and the committee will have it.

Dr. RADAU. The decision was in the appellate court, United States circuit court of appeals, and was given on April 7, 1934, case No. 5106, and I think it was published in 70 Federal (2d), page 505.

Mr. EDELSTEIN. Is that matter of infringement pertinent to this hearing?

Dr. RADAU. No, I merely want to lead up to the question of title. You understand all the patents expired.

Mr. EDELSTEIN. Yes.

Dr. RADAU. There is practically nothing left but the naked title, but the naked title is sufficient to bring suit to have these patents renewed, because somebody must show that they have title.

Now, then, about the same time, and that was in 1929, they started another suit, setting up the same facts of their mortgages on the patents and they brought suit against the American Car & Foundry Co. on the same patents. The same plaintiffs were there, and so forth, and Judge Wilkerson again decided against the plaintiffs, giving as the ground for his decision the lack of title in them, and they were not satisfied with this, and they took another appeal on this last decision, and then the decision on the appeal issued February 29, 1940, and it merely referred to the decree as affirmed and the authority is 50 Federal (2d) 502. I mention this in order to show that Hitzman and his group tried to sue for infringement on the basis of having a mortgage, while admitting that they had no title in themselves while these suits were pending. Banion & Banion, representing the American Car & Foundry Co., answered the complaint and showed them that the title at that time was in a certain Mr. Hoffman.

While this suit was pending, at that time, my clients got in contact with the Hoffman heirs and obtained title from them in order to continue litigation or ask this committee to renew the same. Having title they formed what they called the Car Wheel Association, and transferred 49 percent of whatever amount might be recovered if we are successful to the Car Wheel Association, and this association

is composed exclusively of Elbert R. Robinson noteholders. So that we not only asked relief for ourselves, but we asked for relief for all of the noteholders.

Mr. EDELSTEIN. Under the statutes of your State does the penal law permit them to prosecute an assigned claim?

Dr. RADAU. We do not claim an action

Mr. EDELSTEIN. You are seeking to revive it.

Dr. RADAU. Yes.

Mr. EDELSTEIN. That is permitted under the statute of your State? Dr. RADAU. Yes; that is permitted.

Mr. EDELSTEIN. In New York that would not be permitted. That would be champerty.

Dr. RADAU. Yes.

Mr. EDELSTEIN. You have no champerty statute?

Dr. RADAU. We have, but not covering this phase of it.

Mr. EDELSTEIN. In effect if claimants have numerous claims on which the statute of limitations has run and they seek a bill in order to revive the statute and they form an association and assign these claims to that association and the association seeks to get a bill through Congress is not that, in effect, champerty?

Dr. RADAU. No; I disagree with you. There is, in the first place, no assignment here.

Mr. EDELSTEIN. What was done in order to have that association to get the 49 percent?

Dr. RADAU. The owners of these patents by themselves, that is, Mr. Kalisz and Mrs. Lakomski transferred at their own free will, without any remuneration, and without any promise at all to these noteholders, because it is a fact, the reason why they did, all of them, Robinson in his lifetime did issue these notes which are really all outlawed and do not amount to a row of pins, and he collected about $2,500,000 from people that are very poor. If they have to spend a dollar they feel it. The American Car & Foundry Co., who has used these patents from the very beginning, of course, made an awful pile of money. The noteholders consider, "Well, we contributed $2,500,000 to the inventor, to the patentee, who got at least something, and we did not get a cent, and the notes are bad." We cannot do anything unless somebody buys up the patents for what they are worth. It is only the title. The patents became public property, and they help us save at least some of the money which we invested. Kalisz and Lakomski did do that. They bought up these patents from the heirs of Stanley Hoffman, and they are here asking this committee to renew them. So, they are willing, although they paid their own money for these patents, to give 49 percent if anything is recovered. We have not gotten anything yet, but if anything is recovered, 49 percent goes to the noteholders. I am under no contract with either Kalisz or Lakomski, but with the Car Wheel Association. I am paid from Kalisz and Lakomski for every step which I take. I bill them my price and get paid.

Mr. HARTLEY. Did Kalisz and Lakomski buy the notes?

Dr. RADAU. No; they bought the patents.

Mr. HARTLEY. They bought the patents?

Dr. RADAU. That is all. They have no notes, and they are not owners of the notes. The notes stay with the people.

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Mr. HARTLEY. How many years had the patents to run when these patents were bought by Kalisz or Kalisz and Lakomski?

Dr. RADAU. They had expired. In fact, when the two suits which I mention were brought the patents had expired.

The CHAIRMAN. Find the exact date.

Mr. HARTLEY. When did these patents expire? Dr. RADAU. I will tell you in just a moment. There is one patent, No. 594,286, a wheel patent, issued November 13, 1897, and 17 years after that it expired.

Mr. HARTLEY. Now, can you give this committee any logical reason why we should report a bill to extend the patents at this late date, and at the same time can you answer the argument of the Commissioner of Patents, which the committee has, that this would be serving a very dangerous precedent?

Dr. RADAU. Senator Lucas was kind enough to send me the views of the Commissioner of Patents there, which he sent to Congressman Sirovich. They are in these letters from the Commissioner of Patents and the Commissioner expresses the idea it would be a rather strange precedent to set, saying that in the last 50 years no patents have been renewed. Well, I told Senator Lucas true it is in the last 50 years, but if you look it up in Corpus Juris under "Patents" you will find that 15 patents have been renewed and they were taken into the courts and the question of the jurisdiction or legality of the renewal was decided, and the Supreme Court said the House and the Senate have the right to renew them. Now, there are only 15 of these. I do not know whether any other patents have been renewed which were not taken into court.

Mr. EDELSTEIN. Mr. Witness, we are not challenging the right of the Senate or of the Congress to do it, but the issue involved, so far as the committee is concerned, is what equity or justice is there due to these people who went out and bought up these patents for the purpose of coming before Congress and extending them?

Dr. RADAU. The only justice they have is to give to the people that invested the money, who gave money to Robinson, the inventor, to the original patentee some chance to be reimbursed at least partially for the money. They spent $2,500,000 and gave it to the patentee and did not get a cent.

Mr. HARTLEY. That is all a very unfortunate circumstance.

Dr. RADAU. I grant you that.

Mr. HARTLEY. But does that place the responsibility or the duty upon this committee to make amends for that unfortunate investment by extending these patents?

Dr. RADAU. Take the other side of it. Suppose this committee does not do it, it would be tantamount to the fact of protecting the corporations that used the patents ever since they were patented, and made millions and billions of dollars off of them, without giving one cent either to the patentee nor to the people that helped.

Mr. HARTLEY. They paid nothing to Robinson?

Dr. RADAU. No; not a cent. That is why Robinson brought this litigation and asked these people to contribute. If the corporation was able to make billions of dollars out of these patents and still use the patents, they certainly were fortunate they did not have to pay a cent to the inventor or anyone else. The inventor, during his life

time, by collecting this money from these noteholders was at least able to collect $2,500,000.

Mr. EDELSTEIN. Is that not a matter for the court and not for the committee?

Dr. RADAU. That is the reason why I appear here, to give an account why this ought to be decided in favor of the noteholders whom we represent, so that they, at least to some degree are reimbursed and not have it appear that a committee of the House or the Senate is appearing as protecting devious robbers, and so forth.

Mr. HARTLEY. That is the last thing we want to do, of course.
Dr. RADAU. Yes, I know.

Mr. HARTLEY. Why, if Mr. Robinson collected $2,500,000, as you say, is his widow and her attorney opposing this application?

Dr. RADAU. I do not know that they are.

Mr. HARTLEY. No; they are opposing it.

Dr. RADAU. I suppose they are. Now, then, the question of title has to be taken into consideration. It is a fact that all of these notes were issued by Robinson to these different noteholders contributing money toward the prosecution of the suit. Robinson lost title by court action in the year 1912. Ever since that time Robinson, the patentee, had absolutely no title or interest in any of these patents. Mr. EDELSTEIN. Are these patents still in use now?

Dr. RADAU. Yes, they are.

Mr. EDELSTEIN. And how will the investors benefit financially?
Dr. RADAU. You mean these noteholders?

Mr. EDELSTEIN. Yes, and legally.

Dr. RADAU. In the first place, if we succeed in getting a renewal of these patents, and, of course, we would have to go through the Senate and at least now everything is in our favor-the first thing we will have to do is get an injunction that these patents that they are still using be not used. Then, on the basis of the injunction we would have to act later on. I think, personally, before the corporations that used these patents would permit an injunction I think we might make a settlement. Now, that is my view.

Mr. EDELSTEIN. It is purely speculative.

Dr. RADAU. Yes, purely speculative, but we cannot do anything unless the House and the Senate help us, you see. You know that. We, as title holders, cannot do anything unless Congress and the Senate help us, and I plead this case not so much as for the present owners as for all of the noteholders, and also that the corporations who stole— I dare say stole-Mr. Hitzman used the word "stole"-these patents from the patentee and used them without divulging one cent to the patentee or anyone else, that they be not protected. If the patents are useless to the corporations, well, they gladly will give them up. They will not lose anything, but if the patents are valuable they will fight against it, I am sure.

Mr. EDELSTEIN. Are there any questions by any members of the committee?

Mr. REED. Perhaps it would be well to explain to the committee that there are certain other groups that have claimed an interest in these patents. Can you explain upon what they base their claims?

Dr. RADAU. All of the other groups base their interest on the fact that they are noteholders, and that he represented when issuing these notes to them for certain moneys, promised them orally, verbally, that