KF26 J863 1973a COMMITTEE ON THE JUDICIARY JAMES O. EASTLAND, Mississippi, Chairman JOHN L. MCCLELLAN, Arkansas EDWARD M. KENNEDY, Massachusetts QUENTIN N. BURDICK, North Dakota ROBERT C. BYRD, West Virginia JOHN V. TUNNEY, California ROMAN L. HRUSKA, Nebraska HUGH SCOTT, Pennsylvania STROM THURMOND, South Carolina CHARLES MCC. MATHIAS, JR., Maryland SUBCOMMITTEE ON PATENTS, TRADEMARKS, AND COPYRIGHTS JOHN L. MCCLELLAN, Arkansas, Chairman PHILIP A. HART, Michigan QUENTIN N. BURDICK, North Dakota HUGH SCOTT, Pennsylvania THOMAS C. BRENNAN, Chief Counsel (II) CONTENTS Mr. C. Marshall Dann, president, American Patent Law Association; accompanied by Mr. John T. Calton, president-elect, American William E. Schyler, Jr., Esq., on behalf of the American Bar Asso- Mr. Edward J. Brenner, former U.S. Commissioner of Patents Mr. Charles M. Hogan, general patent counsel, AVCO Corp - Mr. John J. Pederson, Director of Patents, Zenith Corp. Karl E. Bakke, General Counsel, Department of Commerce; accom- panied by Rene Tegtmeyer, Acting Commissioner of Patents; Michael Kirk, Director of the Patent Office, Office of Legislative Thomas E. Kauper, Assistant Attorney General, Antitrust Division, U.S. Department of Justice; accompanied by Richard Saylor, Special Assistant Richard Stern, Chief, Patent Section_.. Mr. Jerry Dunne, Chairman, Legislation Committee, Patent Office Dr. Alan C. Nixon, president, American Chemical Society; accom- panied by Dr. Robert W. Cairns, Executive Director, Dr. John T. Maynard, Chairman of the Society's Committee on Patent Matters and Related Legislation and Dr. Stephen T. Quigley, Director of Robert Gottschalk, Former Commissioner, U.S. Patent Office.. Dr. Howard I. Forman, National Association of Manufacturers; accompanied by Reynold Bennett, vice president for Industrial Statements, supplemental statements, and letters-Continued The New York Patent Law Association. John J. Pederson, Esq.-. Pharmaceutical Manufacturers Association. Page 661 670 673 U.S. Patent Office, former Commissioners, Conway P. Coe; Robert C. 706 U.S. Patent Office, Supervisory Primary Examiners-Classifiers Organization SPECO 707 Robert C. Watson, Esq. 708 Virginia State Bar, Patent, Trademark, and Copyright Section__ 709 711 John W. Yakimow, Esq.. 713 S. 1321-FOR THE GENERAL REFORM OF THE PATENT LAWS, TITLE 35 OF THE UNITED STATES CODE, AND FOR OTHER PURPOSES TUESDAY, SEPTEMBER 11, 1973 U. S. SENATE, SUBCOMMITTEE ON PATENTS, TRADEMARKS AND COPYRIGHTS Washington, D.C. Also present: Thomas C. Brennan, chief counsel, Dennis Unkovic, assistant counsel, Subcommittee on Patents, Trademarks and Copyrights, Bernard Nash, assistant counsel, Antitrust and Monopoly Subcommittee. Senator HART. The committee will be in order. Permit me first a brief opening statement. Then we will proceed to take testimony. Beginning with the 1966 Report of the President's Commission on the Patent System, Congress undertook serious consideration of reforming our system for issuing patents. Many hours of testimony, and dozens of filed statements, have been received by this subcommittee since then on a number of bills designed to accomplish this important and difficult task. Under the able chairmanship of the distinguished senior Senator from Arkansas, John McClellan, the subcommittee reported a solid reform bill in October 1971. Unfortunately, patent reform got no further because of the effort to tie antitrust exemptions for patent licensing agreements to patent reform. No system designed in 1836 can remain viable under the economic and technological conditions of 1973. And that is why the patent system is under attack. Unless it is reformed to create procedures, safeguards, and mechanisms to weed out the bad patents before issuance whether fraudulent or not-and to assure the expeditious and impartial issuance of patents that meet the constitutional and statutory standards, the patent system will die of atrophy. I am pleased to chair what I expect to be the final hearings on patent reform before the subcommittee marks up a bill next month. The bill under consideration, S. 1321, represents a distillation of prior reform bills, including the bulk of the 1971 subcommittee bill, the Presidential Commission recommendations, suggestions for reform made over the past years, and some European approaches. Although complicated, it is designed simply to raise the quality and reliability of the U.S. patent by overhauling the system for issuing patents to promote the progress of science and the useful arts. The hearings will concentrate on the five areas which either contain new reform proposals or have not been recently explored by the subcommittee. I would expect, however, that the subcommittee will consider all of its prior work and the views of the administration, if they should be forthcoming, in reporting out a reform bill. Three days of hearings were originally scheduled for this Tuesday, Thursday, and Friday. As some of you know, the full Committee on the Judiciary has scheduled this Thursday to continue confirmation hearings on Mr. Ruckleshaus as Deputy Attorney General. Our Thursday session, accordingly, has been rescheduled for Wednesday. I apologize for the inconvenience. I am grateful that you were able and willing to cooperate on this problem. Mr. BRENNAN. Mr. Chairman, on behalf of Senator McClellan, I would like to read a short statement. The chairman is otherwise occupied with his duties as chairman of the Appropriations Committee, and cannot attend this series of hearings. He has asked me to read the following statement: The subcommittee today is commencing what is presently contemplated as the final series of hearings on legislation for the general revision of title 35. There are significant differences of opinion concerning what reforms of the patent system are necessary and prudent. These differences have been reflected in the previous deliberations and actions of this subcommittee, and will undoubtedly occur in the further processing of this legislation. I have in the past supported, and will continue to support, such measures as are required to modernize the American patent system. I have in the past opposed, and will continue to oppose, measures which would reduce the incentives of the patent system, or make the system so cumbersome that it is less effective in achieving the objectives for which it was created. A major factor contributing to the inconclusive nature of the prior action of the subcommittee has been the failure of the executive branch to formulate an administration position on patent law revision. On September 21, 1972, the Minority Leader and I addressed a joint letter to the President urging him to direct further efforts to produce an administration bill, including a statutory clarification of the rights of patent owners with respect to the licensing of their inventions. Substantial progress has been made. I understand there is now an administration position on the issues being considered in these hearings. I have been assured that the executive branch will expeditiously complete the remaining work on the preparation of an administration bill. With the cooperation of the executive branch, the bar, and other interested parties, it should be possible for the subcommittee to report a patent revisions bill prior to the adjournment of the current session of the Congress. Mr. Chairman, I ask unanimous consent to have printed at this point in the record the letter of the chairman and the minority leader to the President of the United States. Senator HART. It will be printed. [The letter referred to follows:] The PRESIDENT, The White House, Washington, D.C. SEPTEMBER 21, 1972. MY DEAR MR. PRESIDENT: The 92nd Congress will be adjourning shortly without acting on the legislation to modernize the American Patent System. As you indicated in the Message on Science and Technology "a strong and reliable patent system is important to technological progress and industrial strength". We concur in your judgment that "we must make the most effective |