the second patentee fails to contest the priority within the time limit or a reasonable extension thereof, all rights of the second patentee to any invention common to the two patents shall lapse.

If the law provides that the winning party may have all profits, damages and costs inuring to the benefit of the party first filing, the interference will be by such procedure placed on a basis that will eliminate hundreds of such litigations now carried on for purposes of delay only, or in which inventors or manufacturers have become inextricably entangled without knowing how to escape the meshes. The large accomplishment is that the monopoly exists and operates for the benefit of the rightful patent owner during the interference.

EXTRACT FROM THE SUMMARY OF PROCEEDINGS OF THE SECTION OF PATENT, TRADE-MARK AND COPYRIGHT LAW OF THE AMERICAN BAR ASSOCIATION, CHICAGO, ILL., AUGUST 23-24, 1943

REVISION OF INTERFERENCE PRACTICE

In concluding the report of the patent law revision committee, Chairman Keith referred to the action of his committee in disapproving a proposal of Mr. Henry M. Huxley, of Chicago, that the present interference practice be revised to provide for the taking of testimony before an examiner having power to rule on admissibility. He suggested that the matter be taken up in connection with the report of the special committee on revision of the interference practice. Mr. Daniel G. Cullen, of Detroit, who presented the report of the special committee, stated that they regarded the Huxley proposal as so inconsistent with their own recommendations that if their report should be approved there would be no need to vote on the Huxley proposal.

It will be recalled that last year the association, upon recommendation of the section, adopted a resolution approving in principle amendment of Revised Statutes 4904 (35 U. S. C. 52) to provide that interferences shall be instituted in the Patent Office; that preliminary motions shall be there heard and decided; and that thereafter priority shall be awarded to the senior party unless a junior party files a complaint in the court for the district of which the senior party is an inhabitant or, optionally-if an adverse party resides in a foreign country, or adverse parties reside in a plurality of districts not in the same State-in the district court for the District of Columbia. The amendment further provided that the court thus having jurisdiction shall determine questions of priority, patentability of the invention, the right of the parties to make the claims, and the form of the claims, as well as questions of infringement between the parties; and that the court shall have power to grant injunctions to become operative upon issuance of the patent. The amendment provided for grant of the patent only after final determination of the question of priority.

Last year the committee pointed out that to fully carry its recommendations into effect it would be necessary to draft amendments to related statutes and the section accordingly referred the matter to a special committee, headed by Mr. Otto Barnett, of Chicago. Mr. Barnett, who had been confined to his house for some weeks by illness, was fortunately able to appear briefly during the discussion and was heartily welcomed by the section. At his request Mr. Daniel G. Cullen presented the committee's report. The following is a summary of his remarks. The committee analyzed the action by the section last year as constituting approval of two main propositions:

(1) that testimony in interferences be taken before a court rather than before the Patent Office; and

(2) that in the court proceedings questions of infringement be heard and decided.

While retaining these main propositions the committee had added provisionsinitially advocated by Mr. Dean S. Edmonds, of New York-for an initial administrative award by the Patent Office based on ex parte showings under oath, to be followed by grant of patent in normal course to the recipient of the award without awaiting termination of priority proceedings. The purpose of this is to prevent delay in the grant of patent to the party whose prima facie case indicates he is the first inventor and so remove in most cases the opportunity now afforded the loser to hold up the grant of patent to the winner by resorting to the many technicalities of the present interference practice.

The committee also added a provision that applications for patent shall be rejected on applications of earlier filing date disclosing the same invention and that no priority proceeding shall be established unless the junior applicant makes a prima facie showing of invention prior to the filing date of the earlier application. The underlying purpose of this procedure is to enable the junior applicant to elect whether or not he wishes to contest priority. The committee was of the opinion that the present practice encourages interferences because they are initially declared by the Patent Office and it requires positive action on the part of an applicant to withdraw. It is their belief that under the new procedure many applicants who have no rightful place in a priority contest will refrain from taking the positive action required to provoke one.

Mr. Cullen pointed out that the need for revision of the interference practice is urgent in view of the widespread approval of the 20-year bill, and pointed out that if that measure is passed and the interference practice is not revised many patents involved in interferences will issue for terms far less than the 17 years now provided. He also referred to the report made to the association by the committee appointed by President Morris to consider "current patent problems." This report appears on page 87 of the advance program of the Chicago meeting. The committee, headed by former Judge Hugh M. Morris, of Delaware, concluded that there is but one alleged abuse of the patent system that "cries aloud for curative legislation" and that is the interference practice.

There was appended to the committee's report a request by the section chairman that members not attending the Chicago meeting should write Chairman Barnett a statement of their views. Mr. Cullen reported that but three letters had been received objecting to the report of the majority of the committee and these advocated holding the matter over for another year for further study. He also called attention to the dissenting opinion of Mr. Karl B. Lutz, a member of the committee.

Mr. Cullen moved that the section adopt the recommendations of his committee as reproduced in the printed report and that like action be taken by the house of delegates.

Mr. John F. Robb, of Cleveland, while favoring the committee's recommendations if nothing better could be agreed upon, urged that the administrative award constituted nothing but a "subinterference" and was open to the same objection as the present practice in that the award would be made by personnel of the Patent Office who lack the experience in weighing testimony possessed by the courts. He thereupon moved that the motion be amended by striking out the portions of the recommendations providing for an administrative award.

During the discussion Mr. Merrill M. Blackburn, a member of the committee, stated that they had thoroughly considered Mr. Robb's proposal but felt that it would have the objectionable result of forcing inventors to rush into the Patent Office with applications on immature ideas.

Several members referred to the fact that the National Patent Planning Commission had taken no action with respect to interferences and urged that this foreclosed action by the section, in view of the resolution adopted the previous day with respect to the report of the commission. It was pointed out by the chairman that the commission's report concluded with a statement that the subject of interferences would be reexplored by the Patent Office Advisory Committee. Mr. A. Arnold Brand, of Chicago, a member of the Committee on Revision of the Interference Practice, stated that the committee had considered the commission's report and construed it to mean that the commission was looking to the patent bar for improvement of the interference practice.

Mr. Harold B. Hood, of Indianapolis, inquired if paragraph 4a of the recommendations was intended to provide that upon rejection on an earlier filed application the filing date of such application would be disclosed. Mr. Edmonds, of New York, pointed out that section 5b of the recommendations provide for disclosure of filing dates only after the junior party had satisfied the Patent Office. by ex parte showing that he had made the invention prior to the senior party's filing date. It was also pointed out that the committee had not attempted to embody in its draft of legislation all the details of the practice but had left many of these to be taken care of under the Commissioner's rule-making power as at present.

The question was raised as to whether anyone who received a patent by administrative award would as a practical matter be able to collect royalties or recover for infringement while priority proceedings were pending. It was pointed out by Mr. Henry J. Savage, of New York, that the same situation has existed since amendment of section 4904 Revised Statutes (35 U. S. C. 52) by the act of August 5, 1939.

After further discussion Mr. Robb's motion was voted upon and defeated.

Mr. Ira Milton Jones, of Milwaukee, moved that the report be amended to provide that, in the event of final decision on priority adverse to a patentee, the patent be referred back to the Patent Office for cancelation or reprosecution. The motion was voted upon and lost.

Chairman Barnett urged that the report be approved so that Congress would have before it not only proposed legislation based on the recommendations of the National Patent Planning Commission but also legislation embodying other changes in the patent system recommended by the patent bar.

It was pointed out that the association last year endorsed legislation revising the interference practice and that if no action were taken on the legislation now proposed it would be the duty of the legislative committee to urge enactment of last year's draft.

In reply to an inquiry as to the probable effect of section action on the efforts of the legislative committee, Chairman Chester L. Davis of that committee replied that approval of the proposed legislation by the section would be a big step forward. He stated he is constantly greeted "on the Hill" by the inquiry, "What is wrong with the patent men? Why don't they get together?"

The section thereafter voted to adopt the report of the committee and to recommend to the house of delegates approval of the legislation drafted by the committee.

The house of delegates referred the matter to the board of governors without action.

Hon. FRANK W. BOYKIN,

Chairman, Committee on Patents,

ROBB & ROBB, Cleveland, Ohio, March 17, 1944.

House of Representatives, Washington, D. C.

DEAR SIR: I am not advised as to whether you have concluded accepting suggestions in reference to the revision of the interference practice, H. R. 3264 subject matter of your hearing February last. I might say, however, that, since I wrote you last I have received a copy of Mr. Byerly's statement before the committee at the hearing, and I wish to go on record as advocating, in lieu of the administrative award procedure of H. R. 3264, simple legislation such as proposed by Mr. Byerly under his discussion entitled "Issuing Patents on Both Interfering Applications." This is the simplest practice which can be adopted, and, in my judgment, would be the best practice by which to abolish interferences in the Patent Office and all jurisdiction of any phase of adjudicating priority of invention of the Patent Office therein.

Mr. Byerly implements into statutory wording the practice which was outlined in my marked portion of the digest of my thesis, printed copy of which I enclosed to you with my letter of February 23, 1944.

I definitely hope that your committee will decide that the employment of the administrative award system of H. R. 3264 is unnecessary and undesirable for improvement of the Patent Office procedure.

My only suggestion as to Mr. Byerly's proposal above mentioned, and the last proposal he gives in his paper, is that the time for action on the part of the junior patentee be cut down to either 60 or 90 days so as to reduce the element of delay, which is crucial respecting patents for any important inventions. Respectfully yours.

JOHN F. ROBB.

Hon. FRITZ G. LANHAM,

CAESAR & RIVISE,

Philadelphia 7, Pa., March 8, 1944.

House of Representatives Patents Committee,

Washington, D. C.

DEAR CONGRESSMAN LANHAM: You will recall that at the hearing before the Committee on Patents I made a brief statement and was kindly accorded the privilege of submitting a statement for the record.

By way of background I wish to state that I have had more than 21 years of active patent experience, including 5 years as an examiner in the Patent Office. Since 1930 I have been chairman of the patents committee of the Technical Association of the Pulp and Paper Industry. I have written many articles on the subject of patent law and have written four textbooks on patent law and procedure,

two of which were in collaboration with my associate, Mr. Caesar. Two of these books were on the subject of interference law and practice, and one of these books is now in its third volume. In the preparation of our books we have read several thousand of the actual records and briefs, both in the Patent Office and of the courts, and have come to the conclusion that in an unusually large percentage of cases the decision of the Patent Office is correct.

I am connected with the firm of Caesar & Rivise, which is engaged exclusively in the practice of patent, trade-mark, and copyright law. Our work is done exclusively for individual inventors and small industrial establishments, which are based for the most part on patentable inventions. It has been our observation that the individual inventor and the small industrial establishments have a great deal of confidence in the Patent Office and prefer to have matters tried by the tribunals of the Patent Office rather than by the courts. As a matter of fact, with all due respect to the courts, the small businessman has a much greater confidence in decisions of the Patent Office than he has in those of the courts, and is very reluctant to go to court.

I am herewith enclosing a copy of a talk, which I gave before the Technical Association of the Pulp and Paper Industry at its recent annual meeting, on the subject of Patents in the Post-war World. You will note that pages 8 and 9 are devoted to H. R. 3264. I would suggest that you print these pages as part of my statement. You may, however, if you wish, print the whole article.

I am also enclosing a copy of chapter IV of Richard Spencer's book entitled "The United States Patent Law System," which book was awarded the Charles C. Linthicum Foundation prize in 1930. I am in thorough accord with all the arguments against H. R. 3264 contained in this chapter, and would suggest that you print this chapter as part of the minutes of the hearing.

I note that the proponents of the bill contend that the courts are best able to decide questions of fact. This contention clearly does not apply to such a technical subject matter as patents. The judges in a large number of cases have frankly admitted their lack of the necessary training and ability to hear and decide patent cases.

Furthermore, to follow this contention to its natural conclusion would require that all contested matters requiring the decision of administrative agencies such as trade-marks, complaints before the Federal Trade Commission, tax matters, labor relations, etc., be transferred to the courts. Such a change would be a windfall to lawyers, but it would produce chaos.

I shall be pleased to render any assistance that you and the committee may wish on the subject of patent law.

Cordially yours,

CAESAR & RIVISE, By C. W. RIVISE.

CHAPTER IV FROM THE UNITED STATES PATENT LAW SYSTEM,

BY RICHARD SPENCER

(This book was awarded the Charles C. Linthicum Foundation prize in 1930)

SEC. 8. PRIOR PROPOSALS.-Commencing with the year 1891 considerable agitation has been raised in an effort to have interference proceedings transferred for decision to the courts of the United States. One proposal 3 advocates issuing a patent to the earliest applicant and allowing priority and title to the invention to be worked out by procedure similar to that now followed under section 4915 of

1 The subject matter in this chapter is taken from one of a series of articles written jointly by the author and Jo. Baily Brown, Esp., of the Pittsburgh bar. See, for example, an article entitled "Interference Revision" (Journal of the Patent Office Society, January 1930, XII, No. 1, p. 5 et seq).

2 The earliest found mention of this proposal was contained in the Annual Reports of the Commissioner of Patents to Congress for the years 1891, 1892, and 1898.

See also, Vaughan, Economics of our Patent System. (Published, 1925, by the Macmillan Co., New York.)

It is interesting to observe that a referendum vote on this question was taken in 1929 by the patent section of the American Bar Association and resulted in 212 votes being cast in favor of retaining interferences in the Patent Office and only 60 votes in favor of transferring them to the courts (Report of the Patent, Trade-Mark and Copyright Section of the American Bar Association, October 24, 1929).

3 A Proposed Substitute for Interference Proceedings in the United States Patent Office. An article prepared by Karl Fenning, Esq. (Journal of the Patent Office Society, February 1925, VII, No. 6, p. 257).

the Revised Statutes (appendix, p. 207). Another school of thought favors issuing the patent to the first party to file and thereafter granting patents to subsequent applicants only upon a proper showing, and then upon condition that the later applicant bring suit against the earlier patentee within a certain period in order to determine the question of priority.5

SEC. 9. OBJECTIONS THERETO.-Both of the above plans have been given careful consideration but it has been decided that the responsibility of conducting and deciding interferences cannot prudently or advantageously be avoided by, or removed from, the Patent Office. The statutes and the basic theory of our patent system place upon the Commissioner of Patents the responsibility of issuing patents to the first inventor of patentable subject matter claimed. Where two applicants claim the same invention, the Commissioner cannot discharge his duty without deciding which is in fact the first inventor. To depart from that system would be to change fundamental principles for special cases. Furthermore, questions of priority together with the complex collateral questions that must arise in interference contests are best settled by the expert officials of the Patent Office as a part of the examination system of granting patents. While there may be special cases where a court's action would be preferable, a greater uniformity is probably obtained by having all such issues decided by the same technical bodies, and is probably productive of better results in the aggregate than if interferences were carried through numerous courts scattered throughout the land, and decided by judges having such cases only at rare intervals.

Most patent attorneys prefer the United States district courts to the Patent Office as a forum of litigation. But that is beside the question. It is only where the Patent Office abuses its discretion, or commits plain error, that the courts have any logical basis for assuming the discharge of the statutory ministerial duty placed upon the Commissioner. Remedy for cases of abuse or error is provided under sections 4915 and 4918 of the Revised Statutes (appendix, p. 210), and the proposed substitutes for Patent Office interferences, would be less satisfactory. Nothing has been suggested that woul more effectively discharge thee present obligation of the Commissioner of Patents to issue patents only to the applicants that are found by him on examination to be entitled to them.

The proposition of issuing patents to all interfering applicants and then requiring litigation amongst them to determine who should have the patent, substantially ignores the interest of the public, which would be uncertain for years of the outcome of such litigation. Investigation of priority can best take place before issue of patents. The difficulties of venue and the hardship of trial in far distant places under various proposed plans would be greatly increased by court trials of interferences after issue of patents.

The wide criticism of the interference practice in the Patent Office is in large part based on grievances arising out of special cases. It is and always will be a difficult and technical practice, because abtruse, complicated things can seldom be made simple. But there is an exaggerated idea abroad as to the burden that interferences impose on the Patent Office, and upon the parties. The carrying on of interferences is not a major problem of the Office, on the contrary it is a very small and constantly decreasing proportion of patent litigation generally.

The Commissioner of Patents, Hon. Thomas E. Robertson, writes on this general subject as follows: 7

"It is believed by some that interferences are hopelessly delaying applications for patents. This conclusion is not borne out by the facts. Last year out of 93,592 patent applications filed only 1,519 interferences were declared, and of these only 239 went to final hearing, most of the rest being decided on the record within about 3 months without motions, testimony, or appeals. Our examining corps comprises 610 members, exclusive of the Board, and since it takes only 10 examiners to decide all interferences, including motions and final hearings, it is obvious that the work of the 600 cannot be greatly delayed by the 10. Moreover, as you will note from the figures, at least 95 out of every 100 cases are not delayed at all by interferences since they are not involved in any. Grievous as the delays

4 Patent Law Reforms. An address by the chairman of the patent, trade-mark and copyright section of the American Bar Association. (Reported in the Journal of the Patent Office Society, June 1926, VIII, No. 10, p. 461.) 5 Another plan that, to the author, appears more meritorious than those just mentioned, appeared subSuent to the writing of this treatise, in an article entitled "Proposed Patent Legislation" (Journal of the Patent Office Society, July 1930, XII, No. 7, p. 313 et seq.).

6 See footnotes, p. 19, supra, and p. 79, infra.

7 Extract from a letter written by Hon. Thos. E. Robertson, Commissioner of Patents, to Jo. Baily Brown, Esq,, under date of May 28, 1929.