The Secretary of the Interior no longer signs the patents and has no jurisdiction to grant or refuse them.

Thus it will be seen that the Secretary of the Interior is not required to know anything about patents or patent law. He is not selected because of any qualifications for the granting of patents or supervision over the Patent Office. The Secretary of the Interior has less influence over the Patent Office than over any other bureau of the Interior Department, because there are appeals to him from all the other bureaus. Nor is the Patent Office related to any other bureau of the Interior Department.

The Secretary of the Interior has recently moved out of the Patent Office Building, thus severing physical contact with the Patent Office, which is but a type of the lack of mental contact between the office of the Secretary of the Interior and the Patent Office.

The experience of many commissioners over a period of several generations has shown that, no matter how pleasant the personal relations may be, the Commissioner of Patents can not expect any real benefit to the Patent Office to flow from its connections with the Interior Department. There is nothing in common between the interests of the Interior Department and those of the Patent Office and, consequently, nothing to produce any advantage from the amalgamation of the Patent Office into the Interior Department.

Your committee believe that to make the Patent Office an independent bureau would greatly increase the respect of the public and Congress and the courts for it and would make it easier to procure enlarged appropriations and better salaries than under present conditions.

As to appropriations, under present conditions the demands of the Patent Office for equipment, personnel, and salaries are necessarily subjected to comparison both by the Secretary of the Interior and by Congress with those of several other unrelated bureaus, each pressing its own demands and criticizing any apparent preference. In the opinion of your committee this operates as a severe handicap. In estimating the needs of the Patent Office there should be no discussion of the demands, for example, of the Pension Office or the General Land Office. As an independent institution, the needs of the Patent Office would be judged on their necessity and the appropriation be determined by consideration of general policy.

As to personnel, the enhanced dignity and independence of the Patent Office would render all positions of importance in it more attractive, and particularly would make it easier to secure and retain in office men of the necessary qualifications to fill the difficult office of commissioner.

A copy of a proposed bill for making the Patent Office an independent bureau is annexed to this report, and its enactment is recommended by your committee.

INCREASE IN FORCE AND SALARIES OF THE PATENT OFFICE.

The third proposal which your committee recommends is a substantial increase in the force and salaries of the Patent Office. The patents granted by the United States Patent Office are of less average probable validity than formerly, because the number of applications for patent and the field of search are constantly increasing, while the examining force for many years has been insufficient and has not been increased proportionately. The inducements are so unattractive that 25 per cent of the examining force has resigned within the past three years. Your committee finds that the Patent Office is suffering both from lack of examiners and from inadequate compensation.

The salaries of the Patent Office examiners have been increased only 10 per cent since they were fixed in 1848, when they were approximately the same as those of Members of Congress. At the time the salaries of the examiners in chief were fixed they were the same as those of Federal district judges. During the past 70 years the compensation for technical service in almost all other directions has been increased very largely. Congress, in creating new positions, is willing to pay technical men salaries more nearly approximating the usual compensation of such men in private service, but, having started a position at a given salary, is very loath to increase the salary. A principal examiner, to pass the entrance examination for the Patent Office, must have an education equivalent to that of a college graduate, and yet his salary is so low ($2,700 a year) that it is practically impossible for him to give his own sons a college education.

Your committee believes that salaries should be paid to the examiners proportionate to those paid for equally high technical work in other departments

created recently-such. for example, as are paid in the Army and Navy and in the office of the Attorney General. The examiners are passing upon questions often involving millions of dollars, and they can not be at their best in this vitally important work unless their salaries are large enough for them to live comfortably and without strain. The chances of making mistakes in the granting of patents are great enough even under the most favorable circumstances, and they should not be increased by compelling the examiners to work for inadequate salaries. The inducements should be such as to present compensation and a career which would attract and hold men of the highest ability. The payment of adequate salaries and the creation of provisions tending to hold out attractive prospects to the examiners would also tend to raise the dignity of the Patent Office and to increase its standing in the estimation of the public and of Congress and the courts, and so would tend to enhance the value to the public of the patent system.

The work of the Patent Office has grown so much more rapidly than has the examining force that the examination to determine whether or not the invention claimed in an application for patent is novel is imperatively restricted to the field of search where it is most likely that the invention will be found. Many patents are granted which would not be granted if the examiner had time to make a thorough search. One of the Assistant Commissioners of Patents is compelled to devote a large amount of his time to speeding the work of the examiners in order to prevent further falling behind in the number of unexamined cases. Money is often invested on the strength of patents, only to find later than the patent is upset in the courts, because the Patent Office search did not go far enough to discover that the invention had already been disclosed in some earlier patent or publication. The granting of a patent with invalid claims or claims which are too broad or which are nebulous is a menace to the art to which it relates, and until such a patent has been adju dicated and its effect judicially determined, it tends to prevent manufacturing and commerce in that art. Such a patent may, in this way, cost the public many millions of dollars besides the cost of establishing its invalidity or its true breadth or meaning by litigation, and the prevention of the granting of such patents by any reasonable increase in the examining force of the Patent Office would, in many cases, be a very large saving. The inducement to inventors and investors in patents is consequently lessened, the standing of patents before the courts and the public is impaired, and the production of inventions discouraged.

Your committee accordingly recommends a substantial increase in the salaries of the Patent Office officials, and in the number and salaries of the examiners, as provided in the draft of a bill for that purpose which is attached hereto.

While your committee believes the Patent Office so fully justifies its exist. ence that it would be an exceedingly profitable investment, even though all expenses were paid from the public income, the Patent Office has always been self-supporting and the increase in salaries and examining force which the committee recommends can easily be entirely taken care of by the Patent Office income, if necessary.

COMPENSATION FOR INFRINGEMENT OF PATENTS.

While an injunction can ordinarily be obtained against an infringer in a case where a patent is adjudged valid, except where it would interfere with Government work, a money recovery has not heretofore been generally possible except under most favorable circumstances. In a case where it can not be said that the entire salability of the article depends upon the invention, it has been necessary to show just how much of the price of the article is at tributable to the invention, and as it is ordinarily impossible to make such a separation, and as most patent cases are ones in which it can not be said that the whole salability of the article depended upon the invention, it has resulted that recovery of money is seldom obtained in a patent suit.

Recently there have been two or three decisions in which the courts have taken a more liberal attitude, holding in effect that where an invention has been used by an infringer a reasonable royalty may be awarded to the patentee based on a mere estimation or on opinion evidence, even though no exage computation can be made. This is analogous to the attitude of the courts in personal-injury cases and is entirely just and reasonable. While, as stated. there have been two or three decisions to this effect, it may take a generation to induce United States courts generally to adopt this position, if at all, and

the committee therefore proposes that the law be amended to provide, that as damages to the complainant, the court, on due proceedings had, may adjudge and decree to the owner payment of a reasonable royalty or other form of general damages. Such an amendment has been provided in the attached bill amending section 4921, the Revised Statutes of the United States, and reading as follows:

"If proof is not offered or, in the absence of adequate proof of the amount that should be awarded as damages or profits, the court, on due proceedings had, may adjudge and decree to the owner payment of a reasonable royalty or other form of general damages."

This proposed amendment would enable the patentee in all suits where the patent has been found valid and infringed to recover at least a reasonable royalty, and would provide a money recovery in the great majority of patent suits where no recovery would otherwise be possible. The committee believes that the comparative certainty of financial return would answer one of the most common and strongest reproaches against the patent system, namely that a patent does not ordinarily pay the inventor any money, and it believes that the incentive to invent would accordingly be greatly increased. There are some cases in which it seems to many who are familiar with such matters as though the courts were inclined to go to the other extreme and award damages out of all proportion. Where a complainant has shown that profits have been made by the use of an article patented as an entirety, the infringer is liable for all the profits unless he can show--and the burden of proof is on him to show-that a portion of them is a result of some other invention used by him. If the infringer can not show what proportion of the profits is due to such other invention, then all his profits must go to the complainant. Any rule by which the entire profits are given to a patentee in the absence of proof that they are all due to the invention of the patent sued upon is unfortunate and sometimes very unjust. The proposed amendment to the statute would permit a court under these circumstances to do substantial justice, even though it could not be mathematically exact. In other words, the amendment to the statute would enable a court to avoid Too little.

CONCLUSION.

Your committee, believing that the American Patent System is vitally useful in our system of Government, therefore recommends that the reforms herein discussed be enacted into law. Your committee also recommends that this report be approved by the National Research Council and the committee be continued for the purpose of arousing and coordinating interest in and support for the necessary legislation of various national societies, manufacturing interests, bar associations, and other elements of the public.

Respectfully submitted.

L. H. BAEKELAND, Acting Chairman.

WILLIAM F. DURAND, Chairman (absent in France).
M. I. PUPIN.

R. A. MILLIKAN.

S. W. STRATTON (see reservation below).

REID HUNT.

FREDERICK P. FISH (see reservation below).
THOMAS EWING.

EDWIN J. PRINDLE.

Approved, except the separation of the Patent Office from the Interior Department.

JAMES T. NEWTON, Commissioner of Patents.

RESERVATION BY DR. STRATTON.

I agree to the terms of the report with the exception of that portion which refers to the establishment of the Patent Office as a separate Government institution. It is not quite clear in my own mind that this would be the best thing to do, since in general it is best for all Government establishments to be represented in the Cabinet.

S. W. STRATTON.

RESERVATION BY MR. FISH.

I entirely concur in the substance of the conclusions set out in the above report. I think, however, that the words "if proof is not offered, or" in that portion of proposed section 4921, which deals fith damages and profits,should be omitted so that the sentence in which those words appear should read:

"In the absence of adequate proof of the amount that should be awarded as damages or profits, the court, on due proceedings had, may adjudge and decree to the owner payment of a reasonable royalty or other form of general damages."

I do not think that a statute should directly or indirectly contemplate a condition in litigation in which "proof is not offered.” I believe that the clause which I suggest would accomplish the desired purpose and that the courts in applying the clause would be embarrassed if the phrase "if proof is not offered" were in the statute.

I think also that general damages by way of a reasonable royalty or otherwise should not be awarded unless it appeared that actual damages or actual profits, due to the unlawful use of the invention, could not be determined and that there should not be any language in the statute which implied that no effort be made to determine such actual damages and profits.

FREDERICK P. FISH.

[H. R. 5011, 65th Congress, 1st Session.]

A BILL To establish a United States Court of Patent Appeals, and for other purposes. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That there is hereby created a United States Court of Patent Appeals, which hall consist of seven judges, of whom five shall constitute a quorum, and shall be a court of record with jurisdiction as is hereinafter limited and established. Such court hall prescribe the form and style of its seal and the forms of its writs and other process and procedure as may be conformable to the exercise of its jurisdiction as shall be conferred by law. It shall have the appointment of the marshal of the court, who shall have the same powers and perform the same duties under the regulations of the court as are now provided for the marshal of the Supreme Court of the United States, so far as the same may be applicable. The court shall also appoint a clerk, who shall have the ame powers and perform the same duties now possessed and performed by the clerk of the Supreme Court of the United States, so far as the same may be applicable. The salary of the marshal of the court shall be $3,500 a year, and the salary of the clerk shall be $5,000 a year, both to be paid monthly in twelve equal payments. The costs and fees now provided by law in the Supreme Court of the United States shall be the costs and fees in the United States Court of Patent Appeal; and the same shall be collected, expended, accounted for, and paid over to the Treasury Department of the United States in the same manner as is provided by law in respect to the costs and fees in the Supreme Court of the United States. The court shall have power to establish all needful rules and regulations for the conduct of its business within its jurisdiction as conferred by law.

SEC. 2. That the President of the United States, by and with the advice and consent of the Senate, shall appoint a chief justice of said United States Court of Patent Appeals, and as vacancies occur shall in like manner appoint others to fill such veancies from time to time. The acceptance of that office by a circuit or district judge of the United States shall vacate his office as circuit or district judge.

SEC. 3. That upon the taking effect of this act the Chief Justice of the Supreme Court of the United States shall designate from among the circuit and district judges of the United States six judges to sit as associate judges of the United States Court of Patent Appeals, three of them to sit for three years from the first day of the first term thereof, and three of them to sit for six years from the first day thereof, as associate judges of the ame court for six years from the first day of the first term thereof. And after that, as the periods expire for which such de ignations shall have been made, the Chief Justice of the Supreme Court of the United States shall fill the vacancies thus occurring by designation of the same or other judges from among the circuit and district judges of the United States, to sit for periods of six years each. In case of the death, resignation, or disability of any associate

judge of the said court or of his resignation of his seat in said court, the Chief Justice of the Supreme Court shall designate another circuit or district judge of the United States to sit for the unexpired period for which his predecessor has been designated. The designation of a judge to sit as associate judge of the United States Court of Patent Appeals must be with his consent, and his service in that court hall not vacate his office as circuit or district judge, as case may be.

SEC. 4. That a term of the United States Court of Patent Appeals shall be held annually at the city of Washington, beginning on the second Monday of October in each year, and the same may be adjourned from time to time as the court shall order. If at any time for the meeting of the court a quorum of the judges shall not be present, the judges present may adjourn the court and, if necessary, adjourn again from time to time until a quorum appear. If at any sitting of the court the chief justice shall be absent, the associate judge senior in commission as circuit judge, or senior in age in case of commissions of even date, shall preside. If no circuit judge shall be present, the associate judge senior in commission as a judge of a district court of the United States, or senior in age in case of commissions of even date, shall preside. Until it shall be otherwise provided by Congress the sessions of the court shall be held in a building or rooms to be provided by the marshal of the District of Columbia, under the direction and approval of the Attorney General of the United States. The court shall by order authorize its marshal to employ such deputies and assistants for himself and the clerk of the court and such criers, bailiffs, and messengers as the business of the court shall require, and to pay the salaries of such employees at rates of compensation not exceeding those paid for similar services in the Supreme Court of the United States, and to pay all other necessary incidental expenses of the court. The chief justice and each of the associate judges shall be entitled to employ a clerk, whose salary, at a rate not exceeding that allowed to clerks of the Chief Justice and associate justices of the Supreme Court, shall be paid as part of the expenses of the court. The court shall have power, in its discretion, to appoint a reporter and to fix by order his salary or other compensation and direct the form and manner of the official publication of its decisions.

SEC. 5. That the Chief Justice of the United States Court of Patent Appeals shall receive a salary of $12,000 per year. The circuit judges of the United States, sitting as associate judges of the same court, shall each receive the salary allowed him by law as a circuit judge, and in addition thereto, during the time of his service as associate judge of the United States Court of Patent Appeals, but no longer, such additional sum as will make his entire compensation during that service $11,500 per annum. The district judges, sitting as associate judges of the United States Court of Patent Appeals, shall each receive a salary allowed to him by law as district judge, and in addition thereto, during the term of his service as associate judge of the United States Court of Patent Appeals, but no longer, such additional sum as will make his entire compensation during that service $11,500 per annum. All the said salaries shall be payable in twelve equal monthly installments. The time during which any judge shall serve in said court shall be deemed continuous service with that in any other court of the United States, before or after such service within the meaning and intent of section seven hundred and fourteen of the Revised Statutes. The additional compensation received by a circuit or district judge while sitting as associate judge of the United States Court of Patent Appeals shall not be taken into account in determining the amount to be received by him after retirement.

SEC. 6. That the United States Court of Patent Appeals shall have jurisdiction to hear and determine appeals and writs of error from final judgments and decrees in the district courts of the United States in cases arising under the laws of the United States relating to patents for inventions, and from final judgments and decrees in cases arising under the laws of the United States relating 10 patents for inventions rendered by any other court having jurisdiction under the laws of the United States to hear and decide such cases in the first instance: Provided, however, That it shall have no jurisdiction in cases originating in the Coutr of Claims. All such appeals shall be taken within six months after the entry of the order, judgment, or decree sought to be reviewed. The practice, procedure, and forms to be observed in the taking, hearing, and determination of such appeals and writs of error shall conform to the practice, procedure, and forms observed in like cases in the Supreme Court of the