Government experts from other agencies may be called in from time to time for consultation if it seems expedient or necessary.

The examiners of the several divisions of the Patent Office select the applications which seem to them to disclose inventions of importance to defense. The applications selected are viewed by a group of experienced examiners, organized as the Patent Office defense committee. This committee consults with experts from the defense agencies, such as the Army and Navy Patent Board, and the Office of Production Management, and in this way determines which of the applications should be held in secrecy.

In turn, the Patent Office cooperates with the State Department and the administrator of export control in determining whether licenses should be granted for filing applications for patents in foreign countries. The control over these foreign applications is based on section 6 of the act approved July 2, 1940, under which the President by proclamation requires licenses for the export of documents containing descriptive information as to a limited number of categories covered in the proclamation.

When a license is requested to file an application for patent in a foreign country, the administrator of export control notifies the Patent Office of the serial number of the application for patent filed in the United States corresponding to the proposed foreign application.

The Patent Office, with the aid of the Government advisory agencies, then determines whether or not the United States application should be held in secrecy under Public, No. 700.

The administrator of export control recommends grant or refusal of a license to file application in a foreign country according to the action of the Commissioner on the corresponding United States application.

Public Act 700 is deficient for its designed purposes for the reason that it may be easily evaded by filing applications corresponding to the United States application in foreign countries at any time before the order of secrecy is issued. It is also deficient because its sanction is merely the abandonment of the application involved, together with the forfeiture of the right to receive a patent in the United States. The reason that evasion may be accomplished by filing in a foreign country before an order of secrecy may be issued is that there is no control over the filing of the applications in foreign countries on most of the classes of inventions of importance to defense. No Presidential proclamation under the act of July 2, 1940, covers inventions relating to guns, torpedoes, and many other defense articles.

The amendment to Public, No. 700, proposed in the bill now under consideration, will, if enacted into law, prevent evasion of the purpose of the act by these devices.

Section 3 requires that a license must be obtained from the Commissioner of Patents to authorize filing an application in any foreign country. This will effect control of the export of applications not only in the few categories now under control by the administrator of export control, but will effectively control the filing of all applications in foreign countries.

Section 4 provides that a valid patent may not issue on an application filed in the United States Patent Office when the applicant has permitted an application to be filed for the same invention in a foreign country without the license required in section 3, and will be extremely effective in enforcing compliance with that section.

The present act, in our judgment, is not supported by sufficient sanction. If after an order of secrecy is issued the invention should be published or disclosed in contravention of the order, or if an application is filed in a foreign country without consent or approval, any right to a patent in this country is forfeited and the application is held abandoned.

The act, in our judgment, should be reinforced by adding penalties to this present insufficient sanction, and section 5 provides penalties consisting of a fine of not more than $10,000, or imprisonment of not more than 2 years, or both. The penalties are the same as those provided for offenses in violation of the President's proclamation and in the Espionage Act.

I am informed, Mr. Chairman, that the Secretary of War and the Secretary of the Navy are in substantial accord with the changes proposed by this bill. I believe that this bill if enacted into law will materially reinforce and strengthen Public, No. 700, making it more effective to accomplish its purposes in the interest of national defense. The CHAIRMAN. Mr. Lanham, do you want to make any further comments on the statement of the Commissioner?

Mr. LANHAM. I would like to suggest, in view of the statement with reference to the War and Navy Departments, that it might be advisable now, since they are primarily interested in national defense, to hear from the representatives of the War and Navy Departments.

The CHAIRMAN. I had that in mind, but I thought some member of the committee-does any member of the committee wish to ask Mr. Coe any questions?

Mr. LANHAM. I would like to ask him one question, not with reference to the number, but have inventions been submitted for patent since the enactment of Public, No. 700, which might be useful primarily in national defense?

In other words, does the necessity exist for such legislation by reason of the fact that some inventions are submitted to your office, which might well be kept secret in accordance with the purposes of this act, without disclosing the number?

Mr. COE. The answer is yes. There have been quite a few cases, not numerically large, because our purpose is to restrict the number of secrecy orders to a minimum, and I might further add that to indicate the necessity of this amendment, that there have been cases filed which we thought should be kept secret, and upon notification of the applicant, we were informed that applications already had been filed in a foreign country; it is that situation that we are trying to prevent. Mr. LANHAM. Does not that fact make it important to get the suggested amendments enacted as promptly as possible?

Mr. COE. In my judgment; yes.

The CHAIRMAN. Does any other member wish to ask a question?

Mr. HARRIS. You mentioned a moment ago in your statement that if this act is violated and this information on a particular patent was conveyed to a foreign country that this act gives the Patent Office authority to take away his patent rights here to this particular patent or to all rights?

Mr. COE. To the particular patent on which the order is violated. There is no general order issued. There is an order against the disclosure of a particular application. If, in spite of that order, the applicant goes ahead and files abroad, the present act provides that the

application becomes abandoned, which means that no patent can issue in this country.

The CHAIRMAN. If there is no other member who wants to ask any questions, I am calling Major Vanderwerker.

STATEMENT OF MAJ. FRANCIS H. VANDERWERKER, OF THE OFFICE OF THE JUDGE ADVOCATE GENERAL, UNITED STATES ARMY

Major VANDERWERKER. Mr. Chairman and members of the committee, the bill H. R. 3359 has not been formally referred to the War Department for its views, and consequently I am totally uninstructed as to the official attitude of the War Department with respect to the bill.

I might say that the War Department did, however, make and send to the Budget a report on S. 4410 of the Seventy-sixth Congress, which contained most of the provisions incorporated in H. R. 3359, looking to a strengthening of Public, No. 700. For some reason no action was ever taken by the Budget with respect to that report, I understand on the ground that inasmuch as the Seventy-sixth Congress was soon to die, there was insufficient time for the necessary action.

The CHAIRMAN. But we did want to get something formulated in that last session, and that is why we took the short-cut in getting it out.

Major VANDERWERKER. Surely.

The War Department was favorable to Public, 700, advocated its passage, and is naturally very interested in anything which will tend to strengthen its position with respect to the maintenance of necessary secrecy respecting inventions which are important to the national defense, and I feel reasonably sure that the War Department would give a fovarble report on the present bill.

Mr. LANHAM. Major, if you will pardon my interrupting with reference to the Budget, this bill would not involve any additional outlay of any consequence, would it?

Major VANDERWERKER. That is true, Mr. Lanham. However, we are required to send all of our reports through the Budget for clearance before they are submitted to Congress.

I happen to be a member, representing the War Department, on the Army and Navy Advisory Board, advisory to the Commissioner of Patents, in connection with the administration of Public, 700, and I can personally confirm his statement that we have run into situations in which we have entertained the idea of secrecy, only to find that secrecy cannot be had because either before the American application was filed, or after it was filed and prior to the issuance of the order of secrecy by the Commissioner, there had been a foreign filing, which, of course, did away with any need of American secrecy. The cat was out of the bag, so to speak, and as a member of that board, I feel that there is a need for the strengthening of Public, 700. As a member of the board, participating in the actual administration of Public, 700, I believe that there is need for this bill, and these additional provisions, and that if we are going to have half-way secrecy, we might as well not have any at all. We need complete secrecy or nothing, and I think that this bill is certainly in that direction, and probably all that we need, at least at the present time.

The CHAIRMAN. We have the law now, in other words, and it has not got the teeth in it that it should have.

Major VANDERWERKER. It is leaky, and it has not got the teeth that it needs.

Mr. LANHAM. Of course, it may be said in that regard that the bill was considered rapidly, and there was necessity originally for its speedy enactment, and we knew at the time that it would need amendment and expansion.

Major VANDERWERKER. It was stated, sir, at the hearings, and I think in the committee's report, that this was something to go ahead with and see how it worked, and we would probably find that it was not all that we needed; it might have leaks in it, or other difficulties, which we could later on correct as we discovered them.

Mr. LANHAM. This is simply an effort to correct those leaks.
Major VANDERWERKER. That is it exactly, sir.

The CHAIRMAN. May I interrupt you here?

I might say for the benefit of the new members on the committee and many of the public which are here today that you might perhaps infer from Mr. Lanham's and the major's conversation, and my own remarks in the beginning, that we just went through the prior bill that is now Public, 700 without very much consideration, but I do not want you to get that impression. We did have three or four very enthusiastic sessions here, and for a while there seemed to be quite a bit of interest, and there were members on the committee who are, unfortunately, not here now-I believe Mr. Wolverton and Mr. Church: Mr. Wolverton especially took a very deep interest in it. We had many representatives of industry here and we gave consideration to this in executive session, and they were unanimously for the bill at that time. We did not go as far into consideration of it as we might have gone by reason of the lack of time.

I do not want you to get the impression that we just went through it and did something here hurriedly. It was done in a short time, but not in the sense that we did not give it ample consideration.

Major VANDERWERKER. That is correct, sir.

I have nothing further to add.

The CHAIRMAN. Does any member of the committee wish to ask the Major any questions?

Well, if no one of the committee wishes to continue, I will call Lt. Comdr. K. C. Caldwell, for the Navy.

I believe when we considered this bill which is now Public, 700, Commander Jones then represented the Navy, and was very much in favor of it at that time.

Will you give your full name to the reporter, please?

STATEMENT OF LT. COMDR. K. C. CALDWELL, OF THE OFFICE OF THE JUDGE ADVOCATE GENERAL, UNITED STATES NAVY

Lieutenant Commander CALDWELL. Lt. Comdr. K. C. Caldwell, United States Navy.

Mr. Chairman and members of the committee: As the chairman has just indicated, I have followed here in the footsteps of my predecessor, who while not entirely an authority was at least informed on the original Public, 700.

I might say here that following in his footsteps and being associated with these questions that are arising. I understand that the Navy Department, of course, as was indicated by Major Vanderwerker, was very much in accord and favored the original legislation. Following its enactment there have been indications that there would be a need of additional matter to be incorporated to strengthen that original bill, that original act.

Now, the matter which is appearing here for consideration has come to my attention, as a representative or a delegate from the Navy Department, informally. I am not in a position to speak for the Navy Department, or in any way to tie their hands or indicate what would be their final view or comment and course of action on it. I do think personally that we have something here which is in line with the original intent, which was that of giving something or establishing something in the way of legislation which would control patents, and give needed secrecy.

The original intent being good, that is, Public, 700, then the amendments that are here before the committee and offered to us for comment and consideration, I think that they are good; that would be my personal reaction to them.

I feel very much the same as Major Vanderwerker, in connection with the bill. It strengthens the original act, and it implements it, and it gives a certain amount of control which is needed. I say personally I feel that it is something good.

Mr. CONNERY. On the basis of your own opinion, although you can not speak officially for the Department, you are inclined to believe that the Department would look with great favor upon this proposition?

Lieutenant Commander CALDWELL. I don't see why there should be any objection to it in its present form. I do not see that-I might say that I would not want this to force our hand on it, because it has been submitted to us informally, and there are others concerned than the Patent Division.

Mr. CONNERY. It is just as important to the Navy Department as it is to the War Department, to have this protection?

Lieutenant Commander CALDWELL. Yes; that is the case. It is something that we should have, because as Major Vanderwerker very clearly indicated, unless we have some way to implement it and to forestall those methods which are now available to the applicant to go around it, there may be evasion, though not necessarily purposely. There is this loophole which should be stopped. As to the question of implementing it, and making it otherwise more applicable, that also should be very good.

Mr. HARRIS. Has your Department found difficulties by the evasion of Public, No. 700?

Lieutenant Commander CALDWELL. Yes.

Mr. HARRIS. You know that for a fact?

Lieutenant Commander CALDWELL. Yes. I think Major Vanderwerker indicated that for the War Department, too.

Mr. LANHAM. May I suggest in view of the fact that we have heard from the Commissioner, and the two agencies of the Government primarily interested in this matter, that it might be well to inquire if there are among those present anyone who wishes to appear in opposition to this measure.