In one respect, in our proposed substitute for section 212, dealing with accounting by joint inventors to one another in the licensing or sale of a patent, the recommendations in the American Patent Law Association report are identical with those of the coordinating committee. The only other matter of real substance or change where we suggested an amendment, as I recall now, was in section 102 (g). The suggestions of the coordinating committee and of our committee vary in language, but they are aimed at the same result. So that, I think we could say that we are in substantial agreement as to the substance of our recommendations with the coordinating committee, although in acting on the bill the laws and rules committee of the American Patent Law Association and its board of managers, and then the membership voting on it, was not bound by the action of the coordinating committee. In fact, our action was taken prior to the coordinating committee meeting, so that we did not have at that time the full benefit of all of the discussion which went on at that time.

Mr. ROGERS. What I was getting at is this: As I understand it, you represent the American Patent Law Association as a group, and their recommendations are set forth in your statement here. Did not your group also constitute a part of the coordinating committee?

Mr. ROSE. Yes, sir.

Mr. ROGERS. And you are in substantial agreement with them, but due to the fact that you adopted this before the coordinating committee had made its final report you were not able to get together on everything. Was there any substantial difference between your committee and the coordinating committee?

Mr. ROSE. The only substantial difference between our committee action and the coordinating committee's recommendations is that we have recommended the addition of the publication section. The coordinating committee thoroughly considered that question and voted against the addition of such a section. On that proposal our members voted, as the table here will show, 474 in favor of the addition of the publication section and 46 opposed.

Mr. BRYSON. So more of your own members voted against that proposal than voted against any of the others?

Mr. ROSE. Yes; more voted against it than against any of the others. That 46 votes opposed to the additional section was twice as many votes as there were against any other proposal or section in the bill.

I might add here for the benefit of the committee that the American Patent Law Association is a thoroughly national group in that it has 1,370 members who are spread all over the country and cover most all of the States of the Union as well as the District of Columbia and that the members of the various committees of the association are selected not only from Washington, where I happen to be from, but our membership includes, or my particular committee includes, members from various sections of the country, including Los Angeles, New York, Chicago, and so forth.

Mr. ROGERS. Is this association a part of the American Bar Association, or is that a separate group?

Mr. ROSE. It is not a part of the American Bar Association, but it is affiliated with the American Bar Association, as I understand it.

Mr. ROGERS. The American Bar Association does have a patent section?

Mr. ROSE. Yes, sir.

Mr. ROGERS. As do most States?

Mr. ROSE. Yes, sir.

Mr. ROGERS. Many of the members in your association may be in the other associations; that is, individual members may be members of the State patent section of the American Bar Association and your association?

Mr. ROSE. As a matter of fact, Mr. Rogers, I think over half of our members are members of the American Bar Association—that is, the patent section-and the reverse is also true, that a great number of the members of the various patent law associations throughout the country, local groups, and State goups are also members of the association.

Mr. ROGERS. Thank you.

Mr. BRYSON. All right; thank you very much, sir.

STATEMENT OF GEORGE E. FOLK, ADVISER TO THE COMMITTEE ON PATENTS OF THE NATIONAL ASSOCIATION OF MANUFACTURERS

Mr. BRYSON. Now, we have Mr. George E. Folk as the next witness. I believe Mr. Folk has lately had an operation on his eyes, and he has asked that someone read his statement for him.

Mr. FOLK. Yes, sir.

Mr. BRYSON. Mr. Folk, will you identify yourself for the record? Mr. FOLK. Mr. Chairman and members of the committee, the information you ask for is contained in the first paragraph of the statement which I filed and will be read to you by Mr. Fred Foulk, so that you will get the information.

Mr. BRYSON. All right.

Mr. FOULK (reading):

Mr. Chairman and members of the committee, my name is George E. Folk. I am adviser to the committee on patents of the National Association of Manufacturers, and I am speaking today for that association, a voluntary organization of more than 16,000 manufacturers, 83 percent of whose members have less than 500 employees each.

The NAM favors this bill, although it has several recommendations, mostly of minor importance, which it would like to see incorporated in the bill.

The committee on patents of the National Association of Manufacturers consists of approximately 150 members representing all classes of industry; the large size, the medium size, and the small companies. I am submitting herewith a list of the membership of the committee which states the names of the members and the companies they represent.

To my own knowledge the National Association of Manufacturers for many years has given continued and intensive study to our patent system with the view of improving it wherever possible. It has recognized the importance of inventions and patents in our economy. In 1938, at the time the Temporary National Economic Committee began its investigations, I was retained by the NAM as a consultant with respect to the investigations of the TNEC relating to patents. When the final report of the TNEC was submitted, I was requested to make an analysis and evaluation of the record insofar as it pertained to patents. This report was published in book form in 1942 under the title of "Patents and Industrial Progress" and was given wide distribution.

I continued my relationship as consultant to the NAM committee on patents, and that relationship still exists.

In 1942 our committee on patents undertook to make a survey and suggest constructive reforms that should be inaugurated in the patent system. In other words, the committee desired to take an affirmative stand which would reflect

its earnest wish to advance proposals for corrective legislation on patents. With this in view, a letter was sent to all of the members of the association's committee on patents for suggestions with respect to improving the patent system and also for suggestions on any other items that should be given consideration. The response was gratifying, and some fifty-odd suggestions were submitted for consideration.

These suggestions covered every phase of our patent system. As a result 11 proposals were made by our committee for improving the patent system, and the proposals were approved by the NAM board of directors. This report was given wide publicity and was distributed to the members of the association in April 1943. A continuing study of the patent system by our committee fully prepared it to cooperate with the National Patent Planning Commission, which was at the same time also studying the subject. This National Patent Planning Commission was appointed by President Roosevelt. It consisted of five eminent men representing research, industry, labor, agriculture, and the general public. We met with this Planning Commission and were in a position to answer its inquiries on different phases of the system and also at the request of the Commission submitted a written report on some nine items in which the Commission manifested special interest.

Our committee continued during the subsequent years its consideration of the patent system, especially the reports of the Government-appointed agencies which had made studies and recommendations on the subject. These agencies

were:

1. The Science Advisory Board, which had made a report in 1935. (This report was made an exhibit at the hearings of the TNEC.)

2. The Temporary National Economic Committee.

3. The National Patent Planning Commission.

The recommendations made by these agencies were classified by our committee as consisting of (a) desirable legislation; (b) legislation which was advantageous or disadvantageous, depending on the form in which it was embodied; and (c) undesirable legislation. The report of our committee on this subject was published and distributed to the entire membership of the association in July 1944.

Under date of April 20, 1945, President Truman requested Secretary of Commerce Wallace to undertake a study of the operation and effectiveness of the patent laws and to submit recommendations respecting legislative proposals. The committee appointed by Secretary Wallace submitted for consideration an agenda containing several hundred questions bearing on the patent system. These were give careful consideration by our committee and a reply thereto was submitted to Secretary Wallace's committee on December 21, 1945, in pamphlet form entitled "Comments on the Agenda of the Secretary of Commerce's Patent Survey Committee."

Our committee continued its interest and study of proposals for revision of the patent system and under date of June 18, 1946, made a review which was printed in pamphlet form entitled "A Review of Proposals for Revision of the United States Patent System." This pamplet and the afore-mentioned one received wide distribution.

Continuing its intensive study of the patent system and anticipating possible bills for a complete codification and revision of the patent system, our committee in 1948 prepared and submitted to the NAM board of directors a comprehensive report entitled "Recommendations on Proposals for Statutory Revision of the Patent System." This report was approved by the board of directors of the NAM.

Upon the introduction of the Wiley bill, S. 2518 of the Eighty-first Congress, our committee appointed a special subcommittee to consider this bill and its various features were given serious and extensive consideration.

Our committee at various times considered and passed upon a large number of other bills pertaining to patents and research. As an example of the more important ones, we called attention to the National Science Foundation bill, which was enacted into law; the atomic-energy bill, which was also enacted into law; and a bill for defining damages and profits in infringement suits, which was likewise enacted into law.

On January 10, 1950, Representative Joseph R. Bryson, chairman of Subcommittee No. 4 of the House Judiciary Committee, submitted a committee print for the use of the Committee on the Judiciary of the House of Representatives. In the foreword of the committee print, Mr. Bryson stated:

"The draft presented is intended primarily to serve as a basis for the expression of opinions. Criticisms and suggestions for improvement of anything con

tained in the draft, and suggestions of additional proposals for consideration, as well as support for anything contained in the draft, are especially invited. All comments received before May 1, 1950, will be carefully considered for the preparation of a bill to be introduced on the subject."

Upon the submission of this committee print, our committee on patents appointed a special subcommittee to consider it, since its importance was fully appreciated. This subcommittee consisted of some 25 members and was divided into 5 groups. To each group were assigned those specific portions of the print in which the members of that group were particularly interested and upon which they were well informed. These groups made their report to the full subcommittee, which in turn made its report to the full committee on patents.

The committee print embodied practically every suggestion for the revision of the patent laws that had been made during the previous 20 years. Practically all of these suggestions had previously been given consideration by our committee on patents. Thus we were prepared to submit constructive suggestions with respect to the committee print, as had been requested.

The committee on patents of the National Association of Manufacturers was invited to send a representative to the coordinating committee which was formed by various patent bar associations throughout the country and some of the leading trade associations. We accepted the invitation but reserved the right of independent action, and it is in line with such reservation that we submit this statement.

In July 1950 Mr. Bryson introduced into the House a bill for codification and revision of the patent laws, H. R. 9133 of the Eighty-first Congress. Our special subcommittee appointed to consider the committee print also considered this bill and reported to our full committee. After this report a questionnaire was sent to all the members of our committee on patents asking them to express any views that they might have on the bill.

It is unnecessary now to point out the exhaustive study of the bill made by the above-mentioned coordinating committee, inasmuch as that committee has already summarized its own activities.

No action was taken by Mr. Bryson's committee in the House of Representatives on H. R. 9133, but on April 18, 1951, a somewhat modified bill, H. R. 3760, was introduced by Mr. Bryson. The subcommittee appointed by our committee first studied the new bill, then later, in a 2-day session, May 15 and 16, our full committee gave a detailed consideration to the bill section by section. As a result of this intensive study certain changes in the bill were recommended by our full committee.

Subsequent to this meeting we attended a meeting of the above-mentioned coordinating committee. Some of our recommended changes were, in substance, approved by that committee, and we earnestly hope that they will be deemed acceptable to your committee.

H. R. 3760 contains numerous sections which consist merely of a codification and clarification of existing law without any substantive changes. The bill also contains sections which delete from present law certain obsolete provisions which obviously should not be carried over. Both such sections of the bill meet with our full approval. There remains certain other sections which we feel can be improved and we herewith submit such proposed changes for your consideration.

H. R. 3760

Section 100. Definitions: It is proposed that paragraph (b) be changed to read:

"(b) The term 'art' includes process and method whether of one or more steps, and a new use of a known art, machine, manufacture, composition of matter or material."

Section 101. Inventions patentable: It is proposed to substitute the word “art” for the word "process" in this section and throughout the bill wherever appropriate.

The term "art" is broader than the term "process," and no good reason is seen for the limitation contained in the bill.

Section 102. Conditions for patentability; novelty and loss of right to patent: While this section was approved, it was felt that the language of paragraph (g) thereof might be bettered. The substitute language proposed by the coordinating committee seems to effectuate this. That language reads:

"(g) before the applicant's invention thereof the invention was made in this country by another who had not abandoned, suppressed, or concealed it. In determining priority of invention there shall be considered not only the

respective dates of conception and reduction to practice of the invention, but also the reasonable diligence of one who was first to conceive and last to reduce to practice, from a time prior to conception by the other." Section 203. Disclaimer: As an improvement in language it is recommended that at the end of the second line a period be inserted after the word "invalid" and that the words "and the" be changed to "A."

Section 211. Ownership; assignment: Our committee proposed for the fourth paragraph of this section the corresponding paragraph of the committee print which reads as follows:

"An assignment, grant, or conveyance shall be void as against any subsequent purchaser or mortgagee for a valuable consideration, without notice, whose purchase or mortgage is recorded in the Patent Office within three months from its date, or prior to the recordation in the Patent Office of the said first-mentioned assignment, grant, or conveyance, unless the said firstmentioned assignment,, grant, or conveyance is recorded in the Patent Office within three months from its date, or prior to such subsequent purchase or mortgage."

This proposed change would protect the right of the original assignee even though he did not record within 3 months provided that the subsequent assignee had not recorded in the Patent Office within 3 months or prior to the recordation in the Patent Office of the first-mentioned assignee.

Section 212. Joint owners: This section makes a substantial change in the existing law with respect to the right of joint owners. Our committee disapproved of such changes and desired that the section be amended to set forth the existing law. The coordinating committee took the same position and recommended a change which in substance is the same as that recommended by our committee.

Section 244. Damages: While this section was approved by our committee it was its opinion that an endeavor should be made to clarify the section with respect to damages. This can be done by the slight changes recommended by the coordinating committee, which are as follows: Line 1, strike out "the Court" and insert "damages"; after "shall" insert "be" and change "award" to "awarded". Line 2, strike out "damages".

Section 250. Interfering patents: Our committee suggested the amendment of this paragraph in accordance with the language of the existing R. S. 4918. The section thus amended would read as follows:

"Any person interested in any one of the interfering patents or in the working of the invention claimed under either of them, may have relief against the owner of another by civil action, and the court may adjudge the question of the validity of any of the interfering patents, in whole or in part. The provisions of the second paragraph of section 146 of this title shall apply to actions brought under this section."

Mr. FOLK. I would like to state that at that meeting in May, a month ago, our committee passed a resolution unanimously instructing me to secure the changes we have suggested, but not to insist on them if such insistence would jeopardize the passage of the bill. In other words, they consider the bill as a whole a desirable one.

Mr. BRYSON. Yes.

Mr. FOLK. There is only one change I would like to especially call your attention to, and that is in sections 100 and 101, changing the word "art" to "process." I think if that is changed in the patent law industry will live to regret it. In the first place "art" and "process" are not synonymous, and especially with the definition which follows there is likelihood of getting a false impression of what a new process consists of. I hope it will be given serious consideration, but as I said we do not want to jeopardize the passage of this bill.

Mr. ROGERS. I think the words "useful process" and "art" are not synonymous in any particular and have two distinct meanings.

Mr. FOLK. Yes, some of the courts have held quite properly, as Mr. Federico pointed out, that "process" has been held by the court to come under the term "art," in new machine and composition of matter.