Your committee further feels that the punitive provisions of section 5 of this act are very severe, but beyond calling attention to such fact makes no specific recommendation. MEMORANDUM IN RE H. R. 3360 The patent committee of Illinois Manufacturers' Association do not object to this legislation insofar as it may be designed to prevent interference with our national defense. The bill as drawn, however, attempts to cover too much territory, and, if enacted, might operate to work a real hardship on many American patentees and in effect render valueless a large portion of those advantages and incentives to progress provided by our American patent system. For example, let us consider a patent isued on a plastic product. This plastic product may have among its various fields of use, some utility in connection with the national-defense program. Under the bill, H. R. 3360, no injunction could be obtained in any suit for infringement of the patent on that plastic if either of the armed services, where the Director General of the Office of Production Management or certain other parties certify that the use of the invention covered by the patent was necessary to the national defense or required by the public interest or public safety. Thus even though this plastic product of the patent be useful and desirable in the manufacture of many articles, the owner of the patent could not sue an infringer who was using the plastic to make an ash tray or a cup and saucer or costume jewelry. It is obvious that an infringement suit of this character would be in a field entirely apart from and remote from any use of the patent for defense purposes, yet under the wording of the bill no injunction could be obtained. Nor does your committee feel that the provision in the bill for recovery of reasonable compensation for the infringing act take care of the situation. Those who would conduct infringing practices of the character mentioned relying upon this bill if enacted as drawn, would be concerns having little responsibility who would be in effect "judgment proof" at the time an award of reasonable compensation was made. For the foregoing reasons your committee is opposed to the enactment of H. R. 3360 unless it be amended as follows: Page 2, lines 1 and 2, erase the words "or required by the public interest or public safety." Page 2, line 2, after the word "upon" insert "infringing manufacture, use or sale of". Page 2, line 3, after the word "patent" insert "for the purpose of National Defense". It is believed by the patent committee of Illinois Manufacturers' Association that enactment of this legislation with amendments as herein suggested would serve every purpose intended to be served by the framers of the bill and fully prevent any possible interference with our national defense. Our File 50-778. Hon. CHARLES KRAMER, WATSON, BRISTOL, JOHNSON, & LEAVENWORTH, House of Representatives, Washington, D. C. DEAR MR. KRAMER: Your proposed bill, H. R. 3360, introduced February 17, 1941, has come to our attention. While we agree that in the emergency, patents should not be used to impede the national defense, nevertheless it seems to us that the law should not be so phrased as possibly to permit what amounts to disregard of patents even in cases where (using the phrase of the Canadian Patent Act) the reasonable requirements of the public are met by the patent owner or its licensees. Might we suggest, therefore, that on page 2 of the proposed bill, in line 2 after the comma, the words "and whenever the patent owner or its licensees are unable or unwilling reasonably to supply the defense requirements," be inserted. We should also very much like to see the act include a definition of the term 'reasonable compensation" appearing in lines 6 and 7 of page 2 of the bill. Very truly yours, 315217-41--21 CLAIR V. JOHNSON. PROPOSED AMENDMENTS TO H. R. 3359, SUBMITTED BY FRANCIS M. SHEA, ASSISTANT ATTORNEY GENERAL, FOR THE JUSTICE DEPARTMENT, FEBRUARY 25, 1941 A BILL To amend the Act relating to preventing the publication of inventions in the national interest, and for other purposes Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That the Act of Congress approved July 1, 1940 (Public, Numbered 700, Seventy-sixth Congress, third session, ch. 501), be amended by adding the following sections: "SEC. 3. No person, in respect of any invention made in or brought into the territorial jurisdiction of the United States, and no citizen or resident of the United States, or corporation organized within the United States or directly or indirectly controlled or beneficially owned by any citizen or resident of the United States, or the legal representatives or assigns of any such citizen, resident, or corporation, in respect of any invention, shall file or cause or authorize to be filed an application for patent or for the registration of a utility model, industrial design, or model in any foreign country except when authorized in each case by a license obtained from the Commissioner of Patents under such rules and regulations as he shall prescribe. This section shall not apply to any application corresponding to an application filed in the United States Patent Office which is assigned to the Government of the United States and held under the provisions of the Revised Statutes, section 4894 (U. S. C., title 35, sec. 37). "SEC. 4. Notwithstanding the provisions of sections 4886 and 4887 of the Revised Statutes (35 U. S. C., secs. 31 and 32), any person or corporation and the successors, assigns or legal representatives of any such person or corporation shall be debarred from receiving a United States patent for an invention if such person, corporation, or such successors, assigns or legal representatives shall, without procuring the authorization prescribed in Section 3 hereof, have made or consented to or assisted another's making application in a foreign country for a patent for such invention where authorization for such application is required by the provisions of Section 3, and any such United States patent actually issued to any such person, corporation, successors, assigns, or legal representatives so debarred or becoming debarred shall be invalid. "SEC. 5. Whoever violates any order of the Commissioner made pursuant to the Act approved July 1, 1940 (Public, Numbered 700, Seventy-sixth Congress, third session, ch. 501), or whoever with knowledge of such order publishes or discloses any information in respect of the invention to which such order relates or files or causes or authorizes to be filed, an application for patent or for the registration of a utility model, industrial design, or model in a foreign country except as provided in Section 3 hereof shall be punished by a fine of not more than $10,000 or by imprisonment for not more than two years, or both. "SEC. 6. If any provision of this Act or of any section thereof or the application of such provision to any person or circumstances shall be held invalid, the remainder of the Act and of such section and application of such provision to persons or circumstances other than those as to which it is held invalid shall not be affected thereby." SEC. 2. This Act shall take effect thirty days after its approval. BENJAMIN KAHN, New York, March 10, 1941. Hon. CHARLES KRAMER, Chairman, Patents Committee, House of Representatives, Washington, D. C. SIR: I wish to advise you that I am in complete agreement with the purposes of the bill and believe its passage would aid greatly in reducing vital sources of knowledge to potential or real enemies. I know that certain foreign nations withhold the publication of patents in the interest of their national defense, and I see no reason why the United States. should openly disclose its publications on matters vital to its national defense, especially during the period of emergency. Very truly yours, BENJAMIN KAHN. E. F. WENDEROTH, NEW YORK, N. Y., February 19, 1941. Please attend hearing. Our personal view is approval of H. R. 3359 subject to proviso that where a person has applied for a license to file foreign applications, and such license has been refused, the Commissioner of Patents shall withhold the issue of the United States patent until the applicant is afforded the opportunity of filing such foreign applications. Regarding H. R. 3360, we are sympathetic to the intentions of this measure but must leave it to the experts in United States practice to determine best methods of achieving result desired. LAWRENCE LANGNER. BAILEY & LARSON, Hon. CHARLES KRAMER, Washington, D. C., February 19, 1941. Chairman, Committee on Patents, House of Representatives, Washington, D. C. MY DEAR CONGRESSMAN: I have your note of February 17, 1941, advising that the House Committee on Patents will hold a public hearing on Thursday, February 20, 1941, on H. R. 3359 and H. R. 3360. Because of prior engagements I doubt whether I shall be able to attend the hearing, but I should like to advise you that in this emergency I am heartily in favor, at least in principle, of these two bills. Sincerely yours, ROBERTS B. LARSON. OFFICE OF PRODUCTION MANAGEMENT, Re: H. R. 3360. The Honorable CHARLES KRAMER, Chairman, Committee on Patents, House of Representatives, Washington, D. C. DEAR MR. CHAIRMAN: In the absence of Mr. Biggers, your letter of February 27, 1941, was referred here for consideration. A systematic inquiry made among members of our staff reveals no particular instance in which thus far production for national defense has been unduly delayed or hampered by the assertion of patent rights. The enactment of a law substantially in the form of this bill would, however, constitute a deterrent against the possible assertion of such rights in the future in any way which would interfere with the interests of national defense. It is respectfully suggested that, because of the vagueness of the term, "Chief of any established defense agency of the United States," this clause be stricken and that the power of recommendation be confined to the Secretaries of War and Navy and the Directors of the Office of Porduction Management. Doubtless you are already considering the advisability of confining the suspension of injunction right to those machines, processes, or articles which are required or produced for the purpose of national defense or public safety. Respectfully, JOHN LORD O'BRIAN, General Counsel. HENNINGER & PILLARS, Hon. CHARLES KRAMER, Washington, D. C., February 25, 1941. Chairman, House Committee on Patents, House of Representatives, Washington, D. C. DEAR MR. KRAMER: Mr. Gerald Toye has turned over to me your letter to him as president of the Patent Lawyers Club. Our organization met last Tuesday, February 16, and we discussed the two bills; namely, H. R. 3359 and H. R. 3360, relating to patents on which your committee is now holding hearings. I am attaching hereto individual letters with respect to these bills in which I have tried to express as nearly as possible the sentiment of the Patent Lawyers Club. You will note that we have approved of H. R. 3359 in substance while suggesting several modifications. On the other hand, we have disapproved of H. R. 3360. Very truly yours, Hon. CHARLES KRAMER, PATENT LAWYERS CLUB, PATENT LAWYERS CLUB OF WASHINGTON, D. C., Chairman, House Committee on Patents, House of Representatives, Washington, D. C. DEAR MR. KRAMER: The Patent Lawyers Club met in regular meeting last Tuesday, February 18, 1941, and discussed H. R. 3359, with the result that the following resolution was adopted with respect to this bill: Be it resolved, That the Patent Lawyers Club be placed on record as having considered and approved in principle House bill 3359, and further that the club be placed on record in suggesting that as drawn, and with particular reference to section 3, the provisions of the bill appear to be indefinite, ambiguous, and entirely too broad in scope. That the club further recommends the embodiment in the bill of provisions to the effect that no license should be refused by the Commissioner of Patents unless the refusal of such license is necessary to national defense. That, furthermore, the bill should provide for suitable appeal procedure in case a license is refused by the Commissioner of Patents. That it be furthermore recommended that the word "person" as employed in section 3 be changed to conform with the language embodied in section 4. The membership of the Patent Lawyers Club recognizes the necessity for exercising control over information contained in patent applications relating to public safety or defense during times of national emergency to the end that such information be kept from falling into the hands of an enemy or a potential enemy. Insofar as H. R. 3359 is designed to accomplish this broad objective, we approve the bill. We believe, however, that the language of the bill is broader than it should be. Section 3 of the bill states that "No person shall file," etc. It is our belief that this section should be amended to conform more nearly to the language used in section 4 of the bill. As written, section 3 would apply to any person whosoever, making it necessary for any person, no matter of what citizenship or residence, to obtain a license from the Commissioner of Patents before filing an application for a patent or for the registration of a utility model, industrial design, or model in any foreign country. The language of section 3 should be modified so as to include in its scope only those persons or bodies who, by virtue of citizenship or residence, are under the jurisdiction of the United States or any of its subdivisions. It is the feeling of the members of the Patent Lawyers Club that section 3 of the bill should be modified to limit the effect thereof to patent applications and the like pertaining to public safety or national defense. As written, it is entirely within the discretion of the Commissioner of Patents to grant or deny a license for foreign filing without any regard to the subject matter of the application for patent or the like. Therefore, it is our suggestion that section 3 be amended by inserting in line 11 thereof a sentence somewhat as follows: No license shall be refused by the Commissioner of Patents unless the filing of such application for a patent or for the registration of a utility model, industrial design, or model be detrimental to the public safety or national defense. The definition of persons or groups coming under the language of section 4 appears to be somewhat faulty. According to the language, it appears that any corporation directly or indirectly controlled by or beneficially owned by any citizen or citizens or resident or residents of the United States, etc., will be affected no matter where such corporation may be located or doing business; whereas, there is a serious question whether a corporation located within the United States but controlled by foreign interests is within the language of the section. For example, consider the case of corporation A existing and doing business in Canada, but directly or indirectly controlled by citizens or residents of the United States, which would come within the meaning of the language as now written; on the other hand, corporation B, located and doing business within the United States, but controlled by foreign interests, may not come within the language of section 4. It is the suggestion of the Patent Lawyers Club that the word domestic be inserted before "corporation" in line 9 of section 4. It was the consensus of opinion that the words “any citizen or resident of the United States and any domestic corporation directly or indirectly controlled by or beneficially owned by any citizen or citizens or resident or residents of the United States, and the legal representatives and assigns of any citizen, or such corporation," be used in both sections 3 and 4 in place of the language now defining those subject to these sections of the bill. Furthermore, it was the sense of our group that the bill be further amended to provide for an appeal from the decision of the Commissioner of Patents upon his refusal to grant a license. Very truly yours, Hon. CHARLES KRAMER, PATENT LAWYERS CLUB, PATENT LAWYERS CLUB, Washington, D. C., February 25, 1941. Chairman, House Committee on Patents, House of Representatives, Washington, D. C. DEAR MR. KRAMER: The Patent Lawyers Club discussed H. R. 3360 with the result that its members adopted the following resolution: Be it resolved, That the Patent Lawyers Club be placed on record as having totally disapproved in substance H. R. 3360. It was the unanimous opinion of the Patent Lawyers Club that H. R. 3360 is entirely without present justification. Under the present law. no injunction can be obtained against the United States Government or its agent (manufacturers) for the infringement of a patent, and a patentee's sole recourse is a claim for compensation in the United States Court of Claims. This follows from the Court of Claims Act of 1910 as amended in 1918. The granting of injunctions is a matter of judicial discretion and it is the opinion of the Patent Lawyers Club that no court would grant an injunction in any case wherein it could be shown that to do so would be prejudicial to the general public welfare. The bill is in no way limited for the protection of production by or for the Government and, in fact, such limitation would render the bill parallel with the present law. It must, therefore, be assumed that it is the object of the bill to bring within its scope situations not covered by the present law. The bill, therefore, amounts virtually to a compulsory license law with respect to anything which the Commissioner of Patents may certify as necessary to the national defense or required by the public interest or public safety. Accordingly, under the bill the Commissioner of Patents may certify that the manufacture of shoestrings for Japan or window shades for Borneo may be required by the public interest. It is also believed improper to vest control over courts in an administrative official as the bill attempts to do in the clause reading "Any certificate issued in accordance with this act shall be binding upon the courts." Very truly yours, Hon. CHARLES KRAMER, PATENT LAWYERS CLUB, THE PATENT LAW ASSOCIATION, Chairman, House Patent Committee, Washington, D. C. SIR: Being advised that your committee has before it two bills to amend the act of July 1, 1940, relating to preventing the publication of inventions in the national interest, and for other purposes, and being advised that a hearing on these bills is set for tomorrow, February 20, it becomes my duty to advise you that the Patent Law Association of Pittsburgh in a meeting held yesterday, February 18, having before it the bill S. 4410, deemed section 3 (d), conferring inquisitorial powers upon the National Defense Secrets Board, to be too sweeping and comprehensive. The association adopted a resolution that section 3 (d) |