PREVENTING PUBLICATION OF INVENTIONS AND PROHIBITING INJUNCTIONS ON PATENTS THURSDAY, MARCH 20, 1941 HOUSE OF REPRESENTATIVES, The committee met, pursuant to adjournment, at 10 a. m., Hon. Charles Kramer (chairman) presiding. The CHAIRMAN. We will now adjourn this matter over until early in April, subject to my call, and you will all be given ample notice of the reconvening of the hearing. I understand that the Army and the Navy have not passed through their reports yet, at least we have not received them yet, so that at that time we will know more about where we are. (Thereupon, at 10:15 a. m., the above hearing was adjourned, subject to call.) 183 PREVENTING PUBLICATION OF INVENTIONS AND PROHIBITING INJUNCTIONS ON PATENTS TUESDAY, APRIL 22, 1941 HOUSE OF REPRESENTATIVES, The committee met at 10 a. m., Hon. Charles Kramer (chairman) presiding. The CHAIRMAN. Gentlemen, we will continue with the hearings on H. R. 3360 this morning. I will call as the first witness, Mr. Dorr, chairman of the advisory council to the House Committee on Patents. STATEMENT OF JOHN V. N. DORR, CHAIRMAN OF NATIONAL ADVISORY COUNCIL TO THE HOUSE COMMITTEE ON PATENTS AND PRESIDENT OF THE DORR CO., INC., ENGINEERS The CHAIRMAN. Will you give your name for the record, Mr. Dorr? Mr. DORR. My name is John V. N. Dorr. The CHAIRMAN. Whom do you represent? Mr. DORR. I am chairman of the National Advisory Council of your committee. The CHAIRMAN. And what is your business? Mr. DORR. I am president of the Dorr Co., Inc., engineers. The National Advisory Council to your committee feel that H. R. 3360, on which you are holding this hearing, is unwise, and that the substitute proposed by the Department of Justice is still more unwise. A subcommittee of the council, consisting of William Hammatt Davis, member of the United States Mediation Board, Lawrence Langner, Richard Eyre, and myself have prepared another bill to be presented which has met with the approval of our council. And it is believed that this bill will take care of the indicated purpose of the bills presented and at the same time protect the rights of the inventors. The members of the council are John V. N. Dorr, chairman, inventor, and industrialist, New York City; Maj. Edwin H. Armstrong, professor and inventor, New York City; Thaddeus F. Bailey, inventor and industrialist, Canton, Ohio; Kenneth B. Condit, dean of engineering school, Princeton, N. J.; William A. Considine, lawyer, represents Consumers' League, Newark, N. J.; Robert Cushman, lawyer, Boston, Mass.; William H. Davis, lawyer, member United 315217-41- -13 States Mediation Board, New York City; Richard Eyre, lawyer, New York City; Karl Fenning, editor and lawyer, United States Patents Quarterly, Washington, D. C.; Hon. Learned Hand, Federal judge, United States Circuit Court of Appeals, New York City; A. F. Kwis, lawyer, former president, American Patent Law Association, Cleveland, Ohio; Leonard Lyon, lawyer, Dayton, Ohio; J. Vincent Martin, lawyer, Houston, Tex.; Greer Marechal, lawyer, Dayton, Ohio; Edward S. Rogers, lawyer, unfair competition, Chicago and New York; Walter A. Schmidt, chemist and industrialist, Los Angeles, Calif.; Lawrence Langner, executive secretary, chartered patent agent. Mr. DORR. Mr. Richard Eyre, who was the former chairman of the Council, which I have had the honor of taking over recently on account of his illness, will now present the bill which is proposed as a substitute. The CHAIRMAN. We will next hear from Mr. Eyre. STATEMENT OF RICHARD EYRE, MEMBER OF THE NATIONAL ADVISORY COUNCIL TO THE COMMITTEE ON PATENTS OF THE HOUSE OF REPRESENTATIVES, LAWYER, NEW YORK CITY Mr. EDELSTEIN. I take it that the list of members of the National Advisory Council, as given by Mr. Dorr, was by way of introduction as to who comprised the National Advisory Council? The CHAIRMAN. The chairman would like to advise the member from New York that a resolution adopted at a previous meeting gave authority to the chairman to arrange for the setting up of the Advisory Board as has been indicated. Mr. EYRE. Mr. Chairman, my name is Richard Eyre, a member of the firm of Bartlett, Eyre, Keel & Weymouth, 36 West Fortyfourth Street, New York City, and, as Mr. Dorr has said, a member of the National Advisory Council to this committee. On February 26 I testified before this committee at the hearing at which H. R. 3360 was first considered. At that time I opposed the bill in principle, and expressed the opinion that nothing had occurred or was threatening which tended to show that national defense was being or would be obstructed by patent injunctions. I also expressed the opinion that if it should happen that the enforcement of some injunction would interfere with national defense, the court in the exercise of its customary discretion and power would limit or suspend the injunction to prevent any such evil effect. I also expressed the view that the bill as drawn would deprive patent owners of vital rights, and would do so in cases where the infringement was not in any way necessary to national defense. Since that time much water has run over the dam; but, speaking for myself, I have seen no reason to change these views. General Shea, of the Department of Justice, in his testimony given at a later hearing, has cited some ten instances of patent situations which he said were illustrations of situations in which control of patents and licenses have hampered and even completely obstructed the production of essential materials for the national defense. Studying these carefully, I have been unable to find that General Shea discloses anything that tends to evidence the necessity of a special bill to limit injunctions in patent-infringement cases. As to most of the situations described by General Shea, the theory of the Department of Justice seems to be that if many years ago an act of this kind had been enacted, then certain bottlenecks in nationaldefense industry would not have developed. I cannot subscribe to that conclusion. I feel sure that if such a bill had become a law many years ago, our industrial situation for national defense would be in much worse condition than it is today. Manufactures which have started and been developed because of inventions from foreign countries would not have been developed to anything like the point that they have been. I believe that General Shea must have been misinformed. I understand that others will discuss this subject in some detail and I will leave it to them. But, curiously enough, General Shea's expressed theory is not one that is consistent with the substitute bill which General Shea submitted, because that substitute bill is limited to the period of he emergency. I would like to register, however, our earnest opposition to the patent-condemnation feature of section 2 of General Shea's substitute bill. This provision gives the President the right to acquire for the Government the complete ownership of any patent by merely filing a declaration to that effect in the Patent Office. It leaves to the owner of the patent only the right to sue in the Court of Claims. I quote: for any compensation to which he may be entitled under the Constitution. Mr. EDELSTEIN. Is there anything holier in a patent than there is in land? Mr. EYRE. No, sir. Mr. EDELSTEIN. If the Government can condemn land why cannot it take over and condemn patents? Mr. EYRE. I just happen to be coming to that right now in my prepared statement. The Government retains the right to raise every legalistic defense that can be made against the validity or scope of the patent it has taken away from the inventor or his assignee. I can see this as nothing less than a frontal attack upon patentees and inventors and the laws which have been passed to protect an inventor and encourage invention in accordance with the constitutional provisions relating to inventors. Such a law would be a negation of the idea that a patent right is a property right. What would be said if a provision substantially similar to this section 2 but applicable to other properties, such as real estate, bonds, stocks, buildings, bank deposits, copyrights, and so forth, were proposed? Why should patent property alone be selected? It has been suggested that provisions for condemning land, for example, for Government use are familiar. But when the Government. condemns land it is because it is deemed necessary for its own use. Mr. EDELSTEIN. Isn't such legislation deemed necessary because of the emergency? Speaking for myself, I cannot see any distinction |