credit and remuneration that they now receive for their genius. Bill H. R. 9388 is also very objectionable in that it tends to extent to foreign inventors rights which United States inventors do not have. I appreciate the invitations extended to me in these letters and it may be that I can be in Washington at the time of the latter hearing, namely, May 16. If I am, I shall communicate with you. Thanking you again for your courtesy in this matter, I remain Very truly yours, JOHN E. GARDNER. NATIONAL COUNCIL OF PATENT LAW ASSOCIATIONS, The Honorable CHARLES KRAMER, House of Representatives, Washington, D. C. DEAR MR. KRAMER: I am requested to advise you that the Michigan Patent Law Association, at a meeting held last week, unanimously approved the following bills: H. R. 8441, to afford greater protection to patent rights; H. R. 8442, to prohibit proof of acts done by an inventor in foreign countries; H. R. 8443, to give the Commissioner of Patents power to establish standards of professional conduct among attorneys; H. R. 8444, permitting assignee to make certain supplemental applications. Very truly yours, KARL FENNING, Chairman, Committee on Patent Legislation. REPORT OF THE NATIONAL ADVISORY COUNCIL TO THE PATENTS COMMITTEE OF THE HOUSE OF REPRESENTATIVES, TOGETHER WITH RECOMMENDATIONS RESPECTING LEGISLATION Hon. CHARLES KRAMER, Chairman, Committee on Patents, House of Representatives, Washington, D. C. APRIL 1, 1940. DEAR SIR: On behalf of this council, I beg to submit the following report of its work to date, together with recommendations concerning legislation for the betterment of the patent system. This council has approached its study with the full acceptance of the importance and value of the patent system as a means for encouraging invention in order to promote the progress of the useful arts, and with the understanding that its duty is to advise how the law may be modified to better effectuate that purpose. It realizes that it must proceed deliberately and avoid sensationalism. It has obtained the opinions of other groups. It has sought to balance the often conflicting views of inventor, patent lawyer, assignee, industrialist, and consumer in order that undue weight shall not be given to the interest or prejudice of any. Of necessity the work of the council has been conducted mainly by correspondence. Its membership is so large and widely scattered and includes men of such activity and leadership in various important fields of work that frequent meetings of the full council were impossible. However, two such meetings have been held on September 11, 1939, and February 27, 1940, and by correspondence every member has been fully informed of every question to be passed upon by the council and has had the fullest opportunity to express his opinion. No recommendation is herein made that has not been approved by at least a full majority of the members of the council. At the September 1939 meeting of the council a number of the proposals herein incorporated were approved in principle, and it was directed that committees consider the various subjects further and report upon them and, in certain cases, recommend the particular form of statutory amendments that would be appropriate. Such committees were appointed and submitted reports. These reports and additional matters were discussed at the February 1940 meeting, and it is as a result of resolutions adopted at that meeting, supplemented where necessary by correspondence and written ballots, that the recommendations herein submitted were authorized. RESPECTING PATENTS THAT MAY BE INVALID ONLY IN PART This council believes that the existing law as applied to patents which are, or may be, invalid in part only, is highly unsatisfactory because it brings about grave injustices, extreme uncertainties, and much unnecessary expense and delay. These evil effects have manifested themselves to a progressively increasing degree in recent years. To remedy these evils the council recommends that a statute be enacted substantially in the form of the bill accompanying this report and marked "Proposed bill I (H. R. 9384) of the National Advisory Council to the Committee on Patents of the House of Representatives.' An antique rule of law established by court decisions is that a patent invalid in part is thereby rendered totally invalid. This has never been a statutory provision, but the statutes have recognized its existence. Early in the history of this country it was appreciated that this rule brought about unjust results, and remedial statutes were enacted for the preservation of rights to the patent owner in the valid portion of his patent through the prompt filing in the Patent Office of a formal disclaimer of such separate portion of the patent as was invalid. There are three statutes relating to such disclaimers. The circumstances under which a patentee may diclaim are prescribed in Revised Statutes, page 4917 (U. S. C., title 35, sec. 65). The conditions under which a disclaimer may be effective in a patent-infringement suit are prescribed in Revised Statutes, page 4922 (U. S. C., title 35, sec. 71), and these are partly repeated in Revised Statutes, page 973 (U. S. C., title 28, sec. 821). The bill proposed by the council would repeal these three statutes and provide that a patent invalid in part is not necessarily invalid as a whole, but may, under proper conditions, be effective for that part of the patent to which the patentee should be entitled. This recommendation is made because the history of the attempts by the courts in interpret and apply and disclaimer statutes has resulted in uncertainties, delays, expenses, and injustices that far outweigh the supposed protection to the public, which is at the basis of our present laws. For a complete analysis of this situation, you are referred to an article beginning in the February 1940 issue and concluding in the March 1940 issue of the Journal of the Patent Office Society, entitled "Defects of the Disclaimer Statute," by Dr. Charles Martin, a member of this council. Dr. Martin undertook the research work and wrote this article for the specific purpose of aiding this council. He was chairman of the special committee of the council which formulated the proposed bill. This subject has been for a number of years discussed by many bodies of patent lawyers and others interested in the patent system, and it is safe to say that there is substantial agreement among those who have studied the subject that the disclaimer statutes have brought about intolerable results, that they should be repealed, and that the old rule of law that a patent invalid in part is wholly invalid should be nullified or substantially modified. The bill herewith submitted differs very little from bills that have heretofore been proposed by various committees who have studied the subject. It follows very closely a bill proposed by a committee of the patent section of the American Bar Association. RESPECTING JOINDER OF APPLICANTS FOR PATENTS, THE FILING OF APPLICATIONS BY ASSIGNEES, AND THE REQUIREMENTS FOR EXECUTING THE APPLICATION The council further recommends the enactment of a bill to liberalize (a) the rights of inventors to unite together as joint applicants for a patent, (b) to prevent injury to, or loss of rights of, assignees of inventors by permitting such assignees, under certain circumstances, to file applications for patents in lieu of the inventors, and (c) to simplify the formal application papers. Accompanying this report is a bill designated "Proposed bill II (H. R. 9386) of the National Advisory Council to the Patents Committee of the House of Representatives" to effect these purposes. As to joinder of applicants: The present statutes require that an application be made by the inventor and in terms fail to recognize the well-known fact that many inventions are made jointly by two or more persons. However, the statutes have always been interpreted as meaning by the word "inventor" or "person" or "applicant" either an individual or such individuals as may have jointly made the invention. This has given rise to widespread, continuous difficulty in determing, under the circumstances of each particular case, who among associated persons actually made the invention sought to be covered by the patent. Moreover, after the matter has been determined on the basis of the facts as then understood, circumstances often arise which show that, as regards the subject matter of invention of allowed claims, the situation as to inventorship is quite different. The courts have even held that in a clear case a patent issued to joint applicants is invalid if the invention of the claim at issue was not truly the joint invention of all the applicants. The council is of the opinion, and this opinicn has long been held by a great majority of those who have studied the subject, that this state of things is injurious to inventors, assignees, and the public. It is of the opinion that it would be beneficial to all interests to permit all persons who claim to be the inventors of any part of the matter for which a patent is sought to unite as joint applicants regardless of whether the individuals believed themselves to be sole or joint inventors or whether they had been working upon it cooperatively or independently. By such a practice inventors and attorneys would be relieved from the constant fear that an inadvertent error of this kind had been made, which would result in loss of rights on purely legalistic grounds. The only pertinent and proper interest of the public is that everyone having any claim to the invention is included as one of the patentees. It has no substantial interest in the question of the particular relations to each other of the joined applicants, and should not have the right to infringe a patent otherwise valid and assert invalidity on the ground that one or more but not all of the applicants made the invention. As to the matter of application by assignees of inventors: It frequently happens that an application and the invention thereof is assigned before the patent issues, and that for one reason or another it is necessary to file a divisional application, or a continuing application, or an application for reissue of the patent after it is granted. When this necessity arises the inventor usually has no further interest in his invention, and it may be that he cannot be found, or that for reasons of his own he refuses to execute any further application. Thereby the assignee frequently loses rights for which he has fully paid. The proposed bill provides the remedy in that it permits an assignee to file an application wherever the invention thereof has been previously disclosed as a part of the invention set forth in an application which had been made and sworn to by the inventor. As to simplifying the formal application papers: At present it is necessary that the applicant or applicants sign the formal papers at three different places. Frequent annoyance has been suffered, particularly in the case of applications executed elsewhere than in the attorney's office, because the applicants overlooked one of the necessary signatures. Sometimes delays are caused thereby at a time when it is vitally necessary that the application be filed before a certain date. The bill proposes that when the oath to the application is appended to the other papers, a signature to the oath may be deemed a signature to each of the papers. It is believed that the changes of law proposed by this bill will serve to simplify proceedings to eliminate certain technical losses of right and save considerable expense to many inventors and patent owners, but will harm no one. RESPECTING INVENTIVE ACTIVITIES IN FOREIGN COUNTRIES The council recommends that the law should be amended to provide that neither an applicant for patent nor a patentee shall have the right to rely upon evidence of inventive activities occuring in a foreign country. At present the law (R. S. 4923, U. S. C. title 35, sec. 72) forbids evidence of knowledge or use in a foreign country from being relied upon to invalidate a patent, but there is no provision of the law which prevents an applicant or a patentee from relying upon such knowledge or use. This anomalous situation was recently discussed by the United States Supreme Court in the case of Electric Storage Battery Co. v. Shimadzu et al., 307 U. S. 5, wherein that Court sustained a patent by accepting evidence of the making of the invention in Japan prior to an actual inedpendent use in this country, which domestic use had taken place earlier than that on which the patentee had filed an application in this country. It is believed that those familiar with the subject are in accord in believing that it is against the public interest, and is a great injury to American inventors, to permit reliance upon evidence of unpublished and unpatented activities in foreign countries to affect any question of priority of invention or of patent validity. The Council agreed that a specific addition should be made to R. S. 4886 (U. S. C., title 35, sec. 31) to take care of this situation. In this the council accepted an amendment that had been proposed twice by the patent section of the American Bar Association. Then we learned that on February 13, 1940 a bill, H. R. 8442, was introduced in the House of Representatives, which bill provided for precisely the same amendment. The council, therefore, approves this bill, H. R. 8442, and submits no separate bill. It is noted that H. R. 8442 does not state when it is to become effective and how far its effect may be retroactive. It is suggested, therefore, that H. R. 8442 should include the following section 2: "This act shall take effect immediately and apply to all pending applications for patents and existing patents, except that its provisions shall not be effective to nullify any judicial finding of the validity of a patent heretofore made by a court of competent jurisdiction." RESPECTING THE EFFECT OF A FOREIGN PATENT UPON THE ISSUE THEREAFTER OF A DOMESTIC PATENT It is recommended that the law be amended in such manner that no patent shall be refused or invalidated merely because of the fact that the applicant for the patent had, prior to the issuance of the United States patent, been granted a patent in a foreign country on an application filed in that foreign country more than a year before his application was filed in this country. There are many bona fide reasons why an applicant, either a United States citizen or a foreign citizen, may file an application in a foreign country and then, more than a year later, find himself in a position to file an application in this country. Under our present law he may do so if there is no statutory bar, such as a 1 year earlier publication use or publication, and he may obtain his patent if he can manipulate the speed of prosecution in this and the foreign country, respectively, in such a manner as to have the United States patent issue first. This is purely artificial. If this restriction be removed, the applicant would still be under the disability that he can make no use of the date of application in the foreign country and, therefore, would be subject to statutory bars 1 year earlier than the filing of his application in this country. The present requirement of the statute not only injures these occasional inventors, but it is also a public injury for the reason that in practice the Patent Office, sympathizing with the unfortunate applicant, makes special efforts to speed the prosecution of this type of case, thus delaying prosecution of other applications. Accompanying this is a bill designated "proposed bill III (H. R. 9388) of the National Advisory Council to the Patents Committee of the House of Representatives," which will take care of this situation. This bill merely eliminates one clause from R. S. 4887 (U. S. C., title 35, sec. 32). It is thought that there will be no serious opposition to this bill. RESPECTING THE MINIMIZING OF THE ISSUANCE OF INVALID PATENTS An important committee working in collaboration with this council, of which committee Mr. Leonard S. Lyon is chairman, has made various recommendations concerning legislation for the purpose of minimizing the issuance of invalid patents and for bettering the nature of the patent application and of the patent itself. This committee is still continuing its work, but one of its recommendations has already been finally approved by the council. This recommendation is that the law should be amended to create a proceeding which the committee describes as follows: "Upon final allowance of the claims, the application shall be published prior to formal allowance of the application, allowing a limited time for any persons interested to communicate to the Patent Office any prior printed publications or prior patents that they deem anticipatory. It would thereupon be the duty of the examiner to reconsider any allowed claims in the light of any prior patents or printed publications so communicated and, if found to warrant the rejection of any claims, to result in a new action with the right to the applicant to amend. To avoid possible abuse of the publication of the allowed claims, it is believed that any new law of this kind should provide that the issue of the patent should not be delayed on account of any interference based upon an application filed after the publication of the allowed claims, and that no public-use proceeding should be allowed to be initiated after the publication of allowed claims." By direction of the council, Mr. Lyon's committee is to prepare a suitable form of bill to cover this subject matter. In past years there have been various proposals for opposition proceedings, but these have generally been open to criticisms which the council believes are inapplicable to the procedure above outlined. The obvious purpose of this proposal is to minimize the issuance of invalid patents, by enabling the public to call the attention of the Patent Office to earlier patents and publications which the examiner may have overlooked, or been unable to find because not available to him in his search. The benefit to the public of thus reducing the number of worthless patents is obvious. Such patents constitute threats which are embarrassing and costly to industry and which are likely to result in unrecessary and expensive litigation. Such winnowing out of the chaff from the wheat is equally beneficial to those inventors and patent owners who are seeking and purchasing patents for bona fide purposes. Such persons do not want worthless patents, but want patents to which are attached a strong presumption of validity. There are a number of reasons why proposals for opposition proceedings which have been made from time to time have not met general acceptance. They created contests. They gave opportunities for industrial concerns to delay the issuance of a patent indefinitely, while subjecting an applicant for patent, including those without substantial financial resources, to the expense of prolonged inter partes proceedings, to meet arguments of powerful opponents. Many of these proposals gave opportunities for opponents to take testimony regarding alleged prior and published uses. Also, such proposals were subject to the objection that the making public of the application would incite others to file new applications for the purpose of causing the institution of interference proceedings. And another vital objection of the permitting of such oppositions is that unscrupulous persons would be tempted to create such expenses and delays in bad faith. These objections to opposition proceedings do not seem applicable to the procedure which the council recommends. The Patent Office could, and undoubtedly would, in its rules provide that the examiner in charge of the application would not be informed concerning the identity of the party submitting information of prior patents and publications nor of anything argumentative in the paper submitted by such party. On the other hand, this procedure would effect the most important purposes that could be effected by conventional opposition proceedings, because, where patents are invalid, it is generally because of patents or publications which the examiner had not noted. RESPECTING PROPOSALS OF OTHERS TO FORBID RESTRICTIONS IN PATENT LICENSES, AND TO LIMIT RIGHTS OF PATENT OWNERS IN SUING FOR INFRINGEMENT The Recently there has been much discussion throughout the country regarding a report of the Temporary National Economic Committee approving certain recommendations made by the Department of Justice. These, speaking generally, propose to make it illegal for patent owners to grant licenses having restrictive provisions relating to price, geographical location, quantity, or field of use. proposals also include provisions to limit the right of patent owners with respect to the infringers who may be sued, the general idea being that where possible the patent owner must sue the licensor, if any, of the machines or devices employed by the infringer, rather than the infringer himself, and must sue the manufacturer of the device rather than any dealer or user of that device. This matter was referred by the council to an able committee, of which Mr. Robert Cushman is chairman, and the council has had the benefit of a report of that committee. It has approved the recommendations of that committee that the limitations as proposed by the Department of Justice should not be enacted into law. At this time no bills have been introduced into Congress relating to these recommendations, and it is quite possible that if any bills are introduced later they will reflect much modified viewpoints. It seems sufficient, therefore, that the council advises you of its opposition in principle to the recommendations, without burdening you with a statement of the specific reasons which have led it to this conclusion. RESPECTING H. R. 8441 The council has given preliminary consideration to H. R. 8441, which was recently introduced and which has been referred to the Patents Committee. This bill applies to applications for patent the same rule with respect to recording an assignment or exclusive license which the present statute applies to issued patents. A committee was appointed to consider this bill and report upon it, the report to consider possible amendments to the bill. The council has approved the report of its committee to the effect that the enactment of this bill should be recommended, but that the bill should be amended to substitute the words "thirty days" for the words "three months", in line 3 of page 2 of the printed bill. CONCLUSION Various other proposals, some of them of great importance, are now being studied by the council or its committees, but have not been finally decided by the council. Some of these will form the basis for further reports. |