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Congress to invert this order of priorities to render the patent system a tool of private investors. It is said that patents must be awarded for participation in all research and development, even of the most pedestrian type, in order to foster investment in further research and development. It is darkly predicted that if patents are issued, as the Constitution requires, solely as a stimulus to high quality technological advancement, business will not invest in the work needed to convert inventions into marketable products or, in economists' parlance. "innovations".
To date only the Patent Office has capitulated." In defiance of constitutional and statutory restraints as explicated by the Supreme Court, the Patent Office has not only continued its operational policies unchanged but has joined forces with the patent owners on all fronts.
In implementation of this false philosophy, the Patent Office churns out tens of thousands of patents annually granting monopolies to prirate interests in trivial "inventions" often representing no advancement in technology at all.“
The small percentage of these patents which cover technology that finds wide commercial acceptance virtually all encounter litig:ition in the court: and of those, one quarter or less survive as actually comporting with the statutory and constitutional requisites of a valid patent. This high incidence of invalid patents among those of true commercial significance is symptomatie of a deep conceptual and philosophical division between the Patent Office and the courts as to the correct function of the patent system in contemporary society.
This division can be traced to at least two major defects in the patent granting process. The antiquated procedural handling of patent applications has not changed substantially since 1836. In addition, the false philosophy that private business interests are paramount dominates the Patent Office even as it also dominates the Department of Commerce of which the Patent Office is now a part.
S. 1321 is an informed major effort toward both modernization of Patent Office procedural machinery to put it on a par with that of other government administrative agencies and revision of Patent Office philosophy outlook to insure that private patent monopolies clearly satisfy all constitutional and statutory prerequisites.
S. 1321 is a refreshing and much needed departure from S. 643 of the 92nd Congress and anticipated patent “reform" bills soon to be introduced in this Congress' which, like the 1952 Act, were essentially written by the
2 With the exception, in the congressional context of the enactment of the apparently unconstitutional Public Law 91-577 which authorizes the grant of private patent monopolies for merely norel sexual reproduced plants and in the judicial context. of certain pronouncements by the United States Court of Customs and Patent Appeals. now preponderantly composed of ex-patent lawyer judges. Note the reversal of the Court of Customs and Patent Appeals decisions by the Supreme Court in Brenner 1. Manson, 383 U.S. 519 (1966), and Gottschalk v. Benson, U.S. - 34 L. Ed. 2d 273 (1972).
[T]he bulk of (patent lawyers'] services to clients consists of helping them obtain and defend the validity of patents. Qulte naturally then they tend to identify the good wtih more patents rather than fewer. just as does the Patent Office for a different but parallel set of reasons. Thus the Patent Office and the patent bar comprise a powerful. 'pro-patent' pressure group.
"Because no group of lawyers and no government agency specializes in fighting against patents, and no particular segment of the business community is uniformir harmed by patents, there is no 'antipatent' pressure group... M. Shapiro. “The Supreme Court and Administrative Agencies", The Free Press, N.Y.. 1968. p. 206.
4 "It is now truism among patent lawyers that 1 vou sit around the Patent Office long enough, and change your claims often enough. rou will eventually get some kind of a patent on almost anything'. M. Shapiro. "The Supreme Court and Administrative Agencies", The Free Press, N.Y., 1968, p. 189.
"In fact, ver few of the sevents thousand patents granted each year actually constitute genuinely novel and significant inventions. The vast bulk represent minor changes in the current art, fanciful gimmicks. molecular modifications, even plagarized versions of other patents", Green, “The Monopoly Makers", Grossman Publishers. N.Y., 1973. p. 305.
5 "The Act of 1836 established the pattern for our present sistem by providing statutory criteria for the issuance of patents and requiring the Patent Office to examine application for conformity therewith ... no basic changes have been made in its general character in the succeeding one hundred and thirty years", 1966 Report of the President's Commission on the Patent System. p. 1.
6 It is common knowledge that the American Patent Law Association plans to sponsor a patent law revision bill. The administration is known to be considering a bill which presumably will represent an unacceptable compromise between the views of the Department of Justice and the riews_of the Department of Commerce. the latter synthesized in turn from views of the Patent Office and those of the business groups (including the organized patent bar) to which Commerce is subservient.
patent bar in liaison with the Patent Office to accomplish by legislation enacted by an uninformed Congress? what this same pressure group has always failed to accomplish in the courts.
II. PROCEDURAL OBSOLESCENCE
In 1836 when the present examination process was instituted, it was natural and reasonable to provide for only an ex parte exchange between applicant and Patent Office with the evidence to be examined confined to that availavle in files of published material maintained by the Patent Office and that voluntarily supplied by the applicant. Means of communication and travel were then such that any thought of a more searching factual inquiry involving outside evidence and public participation would have been totally infeasible. During the ensuing 140 years, techniques for communication, travel and for the gathering and evaluation of evidence have advanced markedly. The federal government in establishing a plethora of other administrative agencies has taken full advantage of these advances to provide in almost every case for public inter partes adversary proceedings in which interested members of the public have a fair opportunity to be heard. In contrast, the Patent Office stagnated-largely because it was and is in the interests of the business community for it to do so—and society is penalized by a flood of illegitimate private patent monopolies resulting from secret ex parte, proceedings before an agency which unconstitutionally subordinates the public interest to private gain.
Every federal agency except the Patent Office that is charged with the duty of adjudicating applications for special licenses of franchises 8 has, by rule or statute or both, subpoena power to compel relevant testimony and document submission, a duty to provide for public hearings and to permit public participation in the submission of relevant evidence and a responsibility to sift all relevant evidence that may be submitted from any source.
The Patent Office, by contrast, has no public hearings and affords no opportunity for public participation in its adjudicatory process. It lacks even the power to compel patent applicants to disgorge all relevant facts of which they may be possessed. Its proceedings are secret. It has resolutely refused-the Freedom of Information Act notwithstanding—to make even its final decisions in the adjudication of cases publicly available. Its examiners are treated as part of an assembly line team whose product is patents—and the emphasis is not on the quality of the product but on quantity, with progressive imposition of quotas demanding the generation of more and more patents in less and less time.
The result is that nowhere else in our government are franchises so lightly granted or so little respected. The reason is obvious. Within the
But in a very real sense the Patent Office wrote the congressional statute of 1952 as part of its continued battle with the Supreme Court.
"It had help. The American patent bar is a relatively well-organized group comprehending most of the lawyers who specialize in patent matters, formed into regional associations with a national coordinating hierarchy. As soon as patent law revision was in the wind, this group created a task force of its most prominent leaders to help shape the legislation. This task force became so active in the statute drafting, that in the end Mr. Federico (a leading member of the Patent Office bureaucracy) did not so much draft legislation for a congressional committee as with the patent bar. Not only did he and three lawyers officially representing the organized patent bar do almost all of the drafting, but the drafts were circulated among all prominent patent lawyers and revised to conform to their desires. (Emphasis in original.]
"In any event the propatent forces had a free hand in writing the (1952) legislation mnopposed by any countervailing group. Of course the congressman on the subcommittee, and then those on the full Judiciary Committee, all of them lawyers, but none particularly expert on patent matters, did re lew the draft. Bu they made few changes, and the Committee's report and 'Revisor's Notes,' which accompanied and explained the bill, were written by Federico, either independently or in cooperation with the representatives of the patent bar. One of those representatives has proudly answered the question: Who wrote the patent laws of 1952? We did.'" M. Shapiro, "The Supreme Court and Administrative Agencies", The Free Press, N.Y., 1968, pp. 205-206, 207; emphasis added.
** "The patent is a privilege ... conditioned by a public purpose. ..'”, Blonder Tongue Laboratories, Inc. v. University of Illinois Foundation, 402 U.S.' 313, 344 (1971), quoting Mercoid v. Mid-Continent Investment Co., 302 U.S. 661, 666 (1944).
a Irons v. Schuyler, 465 F. 2d 608 (D.C. Cir. 1972). The paragraph of the affidavit of Patent Office Solicitor Martin quoted in the court's opinion was later shown to be factually inaccurate.
limits of human capability, other agencies act on the basis of all relevant facts after hearing from all interested parties. The Patent Office does not. Moreover, it realistically cannot without a substantial overhauling of its procedural machinery along at least some of the lines contemplated by S. 1321.
In this regard, the following provisions, among others, of S. 1321 are basic and are long overdue:
1. Section 1 which requires the title to be interpreted in light of the “constitutional purpose".
2. Section 3(d) establishing a Public Counsel independent of the agency whose duty it is to "assure as an advocate through the adversary process that high quality patents which meet the statutory and constitutional criteria therefor issue from the Patent Office" and Section 24 which makes it possible for the Public Counsel todischarge his duty by the exercise of a subpoena power to obtain relevant facts, documents and testimony for use in any patent application proceeding.
3. Section 23 affordmg full subpoena power to the agency itself.
4. Section 122 abolishing excessive secrecy and making patent applications, as well as Patent Office adjudications, open to public scrutiny.
5. Sections 132 and 134 ensuring that a complete written record of proceedings is maintained and made publicly available.
6. Sections 135 and 137 permitting any member of the public to participate fully in the adjudicatory process, inter alia, by submitting evidence or argument at any stage of each proceeding.
7. Sections 115 and 131 requiring applicants and their attorneys to submit an identification of all available prior art and other facts relevant to the equities of the application, thereby enabling the examiner to spend less time in searching out this material and affording him more time in which to evaluate the application-and insuring integrity in the patent granting process.
Pursuant to Sections 191–193, moreover, only those patent applications would be subjected to detailed examination on the merits for which the applicant or member of the public had paid a special so-called "examination fee". Thus, by relieving examiners of the obligation to examine fully all patent applications, more time would be afforded for intensive examination of those on which the fee is paid.
III. FALSE PHILOSOPHY The office of Patent Commissioner has long been a political plum awarded to patent lawyers in the service of business interests. Not surprisingly, the endeavor of the agency under these patent lawyer administrators has been to subsidize research and development by granting as many private patent monopolies as possible without regard to the constitutional and statutory prerequisites of validly patentable invention. The strategy of these Commissioners has been and is to join with the organized patent bar from which they came in importuning Congress to enact invalid legislation purporting to lower the constitutional patentability standard to the level to which the agency and the patent bar subscribe.
A classic example is found in the testimony of Wm. E. Schuyler, Jr. who was at the time of his 1969 nomination to the post of Commissioner and is now a Washington, D.C. patent lawyer representing a plurality of corporate clients. In his May 1969 confirmation hearings before this subcommittee, in response to an inquiry by Senator McClellan with respect to the mortality rate of patents in the courts, Mr. Schuyler expressed his belief, notwithstanding the Supreme Court's reiteration of the constitutional standard of invention in Graham v. John Deere Co., 383 U.S. 1 (1966), “that the Congress in 1952 intended to change the measure of the standard of invention which would be patentable when [it] enacted section 103 of the patent law. The Courts have not, in my view, followed that intention. ... I think if the Congress made clear that, in considering the present legislation, its intent is as I viewed it before that the courts will have more guidance in this a rea" (Hearing Before Subcommittee on Nominations of the Committee on the Judiciary, May 2, 1969, pp. 14-15). Consistent with this attitude, under
the administration of Commissioner Schuyler the agency standard of patentability reached a new low.10
There are a plurality of ways in which the Patent Office-organized patent bar pressure group seeks to induce congressional subversion of constitutional patent policy. Typical—and of special significance—is the continuing insistence upon legislative erosion of the constitutional patentability standardeffectively countered by S. 1321 1—and the related demand for statutory departure from the constitutional requirement that patents be granted to "inventors” to permit issuance of patents to corporations. Sections 111 and 116 of S. 1321 unfortunately and perhaps unintentionally succumb to this demand. A. The Constitutional Patentability Standard
The principle explicated by the Supreme Court in a consistent line of decisions beginning at least as early as 1885 12 that adjudication of patent validity requires reference to a constitutional standard remained unchallenged until it was reiterated in 1950 in Great A.&P. Tea Co. v. Supermarket Equip. Corp., 340 U.S. 147, 154.
After A.&P. patent owners recognized that a successful challenge to the constitutional origin of the patentability standard reiterated by the Supreme Court was essential to the validity of their then-pending "corrective" legislation which ultimately matured as Section 103 of the Patent Act of 1952.13
Immediately upon its enactment, Section 103 was advanced as a proper exercise of congressional prerogative which repudiated A.&P. to exclusively define the standard for patentable invention at a level below that which the Court had held to be expressed in the Constitution."
10 It is instructive to note that Commissioner Schuyler has not only returned to the lucrative private practice of patent law_but is also the founder and Chairman of the Board of Directors of "Intellectual Property Owners, Inc." (IPO), a “nonprofit corporation" financed by "membership dues' *deductible" as "business penses". The “members" of course are corporations and patent lawyers. In short, İPO is a tax-exempt patent lobby. The quotation from the copyrighted IPO 1973 publication, "The U.S. Patent System Needs Your HELP !" This publication describes four types of corporate membership with dues ranging from $10,000.00 to $500.00 annually. Individual dues are $100.00 annually.
Similarly, ex-Commissioner Edward J. Brenner is the founder and President of the Association for the Advancement of Invention and Innovation, another tax-exempt patent lobby.
11 This insistence has most recently taken the form of a protestation of lack of clarity in the $103 standard consequent from an alleged "conflict" between the Supreme Court's 1966 decision in Graham V. John Deere Co., 383 U.S. 1, and its 1969 opinion in Anderson's-Black Rock v. Pavement Salvage Co., 396 U.S. 57. The "conflict” actually does not exist on any fair reading of the two cases in context, the later decision in Anderson's-Black Rock being premised squarely and in terms upon $103 as explicated in Graham. To simulate "conflict” it has been necessary to change the whole thrust of Graham by focusing upon its passing reference to "secondary considerations ... surrounding the origin of the subject matter sought to be patented" which "may have relevancy" "as indicia of obviousness or nonobviousness” as the true test of $103 and then to see as inconsistent with that false test, the Court's refusal to find "relevancy" in the secondary considerations proved in Anderson's-Black Rock.
In short, the pretense of conflict is just that and the consequent lack of clarity in $103 is equally illusory. The problem of the organized patent bar is that $103 as it now exists does not comport with what the bar wants. Its requirement for a high standard of patentability is, if anything. too clear to be palatable.
19 "... This court, however, has repeatedly held that, under the Constitution and the Acts of Congress, a person, to be entitled to a patent, must have invented or discovered some new and useful art, machine, manufacture or composition of matter, or some new and useful improvement thereof, and that it is not enough that a thing shall be new, in the sense that in the shape or form in which it is produced it shall not have been before known, and that it shall be useful, but it must, under the Constitution and the Statute, amount to an invention or discovery." Hill v. Wooster, 132 U.S. 693, 700 (1890). quoting Thompson v. Boisselier, 114 U.S. 1, 11 (1885).
See also Pennock v. Dialogue, 27 U.S. 327 (1829); Atlantic Works v. Brady. 107 U.S. 182, 200 (1883); McClain v. Ortmayer, 141 U.S. 419, 428 (1891); Cuno Engineer. ing Corp. v. Automatic Devices Corp. 314 U.S. 84. 91 (1941): Graham v. John Deere Co., U.S. 1 (1966); Anderson's-Black Rock v. Pavement Salvage Co., 396 U.S. 57 (1969). And see Lear v. Adkins, 395 U.S. 653 (1969); and Blonder-Tongue Laboratories, Inc. v. University of Illinois Foundation, 402 U.S. 313 (1971).
Lack of invention was a defense recognized to strike at the root of the whole claim needing "no statute to ai or justify" it and “provable when it exists under any general denial", Reckendorfer v. Faber, 92 U.S. 347, 354 (1876), appropriately raised “gua sponte, if the objection was not taken by counsel", Slawson v. Grand Steel R.R. CO., 107 U.S. 649, 652 (1883).
13 See "Efforts to Establish a Statutory Standard of Invention", Study No. 7 of The Subcommittee on Patents. Trademarks and Copyrights of the Committee on the Judiciary. United States Senate. 85th Cong. 1st Sess.
14 See Rich, “The Vague Concept of 'Invention' As Replaced by Sec. 103 of the 1952 Patent Act”:. 46 J. Pat. ofc. Soc'y 855 (1964). See also Aitken, “PatentsStandard of Invention-Constitutional or Statutory", 24 Geo. Wash. L. Rev. 722 (1956).
The majority of the lower courts, having regard to A.&P. and similar Supreme Court ulings, correctly held that $103 only codified' existing law and hence did not purport to compromise the constitutional patentability standard. A comparatively few conflicting decisions tú fanned the flames of controversy.
This conflict came to a head when Graham, supra, reached the Supreme Court in 1965. Patent owner-petitioner Graham and various of his supporting amici uged that no patentability standard other than mere novelty is written into the Constitution, that $103 is the sole patentability standard, and that the Supreme Court was precluded from repudiating congressional intent as reflected by that statute.16
The Supreme Court in Graham, supra, rejected all of these arguments calculated to insulate the issue of validity from appellate scrutiny, reaffirmed A.&P. and emphasized once again that “[I]t must be remembered that the federal patent power stems from a specific constitutional provision" which is "both a grant of power and a limitation" that “Congress in the exercise of the patent power may not overreach the restraints imposed by the stated constitutional purpose” and that the patent system “by constitutional command must ‘promote the Progress of ... useful Arts'. This is the standard expressed in the Constitution and it may not be ignored. And it is in this light that patent validity requires reference to a standard written into the Constitution', A.&P. Tea Co. v. Supermarket Corp.", 383 U.S. at 5, 6. Further, the constitutionality of Section 103 was sustained only in view of the Court's finding that the statute "was not intended by Congress to change the general level of patentable invention” but “merely as a codification of judicial precedents ... with congressional directions that inquiries into the obviousness of the subject matter sought to be patented are a prerequisite to patentability". In sustaining $103, the Court said, “Approached in this light ... the emphasis on nonobviousness is one of inquiry, not quality, and, as such, comports with the constitutional strictures”, 383 U.S. at 17.17
Undaunted by the Supreme Court's refusal to depart from constitutional principle, the patent special interest groups intensified the campaign which they had waged since 1951 both in the courts and in the Congress." Seizing the very next opportunity, the American Patent Law Association in 1971 devoted 15 pages of a 28-page amicus brief in Blonder-Tongue to the contention that 35 U.S.C. 103 as construed in Graham and Adams 19 is "the sole test of patentability", the Constitution notwithstanding. Concurrentlyand with total disregard for the apparent unconstitutionaliy of the proposed statute-Congress was told by many "pro-patent" witnesses appearing at the May 11, 12 and 13, 1971 hearings on S. 643, S. 1253 and S. 1255, 92nd Cong., 1st Sess., that a "crisis” had overtaken the patent system requiring
16 See "The Standard of Patentability-Judicial Interpretation of Section 103 of the Patent Act", 63 Colum. L. Rev. 306 (1963).
18 "Since the passage of the 1952 Patent Act the conditions for patentability hare been exclusively defined by statute and it is the function of the federal courts to ascertain whether such conditions have been satisfied". Brief of the New York Patent Law Association as Amicus Curiae in Graham v. John Deere Co., p. 10.
"In that  Act Congress expressed the judgment that the progress of useful arts would be promoted by application of the standard of unobviousness, as stated in Section 103, as the test of patentability. ... It is a judgment in no way inconsistent with the Constitutional grant of power to Congress. And in this connection it must be borne in mind always that the role of the judiciary in reviewing the legislative judgment is a narrow one in any case'" (citations omitted). Brief of American Bar Association as Amicus Curiae in Graham v. John Deere Co., pp. 17-18.
"Whether a discovery is patentable is under Section 103 not related to any 'standard of invention' as it was by prior case law, now patentability is determined solely by" Section 103. "The constitutional word discovery' authorizes Congress if it so elects to protect erery original 'finding out of any stature, whether or not previously known to others or obvious from what others have done". Brief_ .4 micus Curiae in Support of Section 103 filed in Graham V. John Deere Co. by E. Ernest Goldstein, Professor of Law. University of Texas, p. 8.
17 These very same constitutional principles were reiterated by the Supreme Court in its 1969 opinion in Anderson's-Black Rock, supra, and adverted to in Lear, supra, 395 U.S. at 676, and Blonder-Tongue, supra. 402 U.S. at 333.
14 The campaign was successfully extended well to secure the appointment of "pro-patent" judges to the Court of Claims and the Court of Customs and Patent Appeals as well as a Commissioner of Patents who expressed his rejection of Supreme Court law at his confirmation hearings. See pn. 9-10, supra.
19 United States v. Adams, 383 U.S. 39 (1966).