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A considerable investment may be made. Then if the life of that controlling patent is extended, industry suffers.
In view of the number of patents
Mr. LEWIS. What you have to balance there is the deprivation of the veteran against the possibility of loss to industry.
Mr. STEPHENS. Yes, sir.
Mr. STEPHENS. In view of the number of patents, it is extremely difficult now to keep abreast of the valid patents that you are interested in and the ones which have expired or are invalid, and anything which will further confuse the system is looked upon with great anxiety by the members of the patent profession, for whom I am now speaking
Mr. KEATING. Not by the lawyers, is it?
Mr. STEPHENS. I am speaking only for the lawyers. I am not speaking for myself at this moment.
Mr. KEATING. I thought it was the businessmen that were injured by this. The more confusing it is, the better for the lawyers, is it not?
Mr. STEPHENS. If there were no trouble and confusion in the world there would be no lawyers, and that is the only answer I can give you on that.
But the lawyers must advise industry and they must advise them in the best manner of which they are capable.
Mr. Bryson. You understand, Mr. Stephens, that the present committee is new, entirely new. There is not a man on the committee that has ever served on the Patent Committee.
I do not want to get your mind off your trend of thought but there are a lot of things that we do not understand.
I would like to ask now, how did the patent law ever determine the life of a patent at 17 years! That is the first time I have known that number of years to be used in any statute. How did you determine that?
Mr. STEPHENS. It was arbitrarily arrived at. Many years ago one bill was pending in Congress saying that the term of a patent should go 15 years. Another bill was pending saying it should be 20 years; and 17 years was arrived at simply as a compromise. No one knows how long it takes to exploit patent rights, but over a period of years, it has just been said that 17 years is a reasonable time.
Incidentally, the purpose of the association and the purpose of my being here is to give the members of the committee the benefit of the knowledge with respect to patents that we have. If we cannot do that, then there is no purpose of our appearing before the committee; so we ask you to let us give you any information which you may desire.
In the bills pending, Representative Grant's bill, Å. R. 65, and Representative Stratton's bill, H. R. 1984, refer to patent rights for both civilians and veterans, no distinction being made between the two.
In other words, any civilian or serviceman who might have a patent would come under either of these two bills.
The other two bills before the committee, Representative O'Hara's bill, H. R. 124, and Representative Rich's bill, H. R. 1107, relate in particular to rights which may be held by veterans or men serving
in the Army and Navy, Marine Corps, or Coast Guard during the past World War.
The members of my association feel in general that all patent rights were curtailed during the war, the same as all private rights and efforts were curtailed during the war. In other words, while it is true that a serviceman suffered by not being able to exploit his patent rights, it is also true that a civilian owner of a patent could not exploit his patent rights because (1) he may have been engaged in war service, such as by working in a shipyard, and (2) industry was geared to the war effort and materials and labor were not available to the manufacturer to use and sell an invention which was set forth in his patent.
In other words, everyone suffered by virtue of the war, and who can say that a veteran suffered more than a civilian, in general ?
Mr. KEATING. Perhaps the test should not be that, but was the contribution of the veteran such to his country that he is entitled to some extra consideration by reason of that?
Mr. STEPHENS. Perhaps that is so.
However, the position of the association is that the patent system is so complex in its existence now that when we begin to tamper with it by extending certain patents the injury to the public is liable to be much greater than any good which may be achieved by a few individuals, and we are not willing to extend patent rights or recommend the extension of patent rights to anyone because of the war.
We have all suffered because of the war. Consequently, these general bills, which would give privileges to all holders of patents by virtue of the war, are opposed by us in principle.
And secondly, we include in them the veterans' bills as a matter of principle. That has been the consistent position of the profession over the years, beginning with World War I and right on through. In other words, unless there is particular hardship shown, we object to any tampering with this complex system.
That is my statement on behalf of the association. I will be glad to answer any questions you may have.
Mr. LEWIS. Mr. Chadwick.
Mr. CHADWICK. Mr. Stephens, speaking from ignorance and not information on the subject, I am at a loss to understand how the proposition, so far as it affects the veteran's case, is as serious as you suggest. You have to watch the expiration date of the patent, which is an established fact. Now, under this act, as I understand it, from a very hasty reading, there is a period of uncertainty about 6 months within which a patentee can file, possibly extended a little longer than that in the case of men already in the service.
Now, why is that such a serious burden on industry at large?
Mr. STEPHENS. As it turned out after the last war, there were only six patents which were extended by virtue of the legislation which was passed. If only a few patents are extended, the chances of the burden on industry because of confusion and uncertainty would be very little. But I do not know, sitting here, how many patents would be extended under this.
Suppose we say that there are 20,000 patents which might be extended. The figure may be entirely wrong. But assuming that
when a client comes to an attorney and says, "Here is a patent owned by someone else. I want to make it. When will I be able to make it?” Then it will not appear generally on the face of the patent what the expiration date is.
We might say, “Well, a patent lasts for 17 years," and then find out that "By golly” that patent does not last 17 years, but is not going to expire for another 6 years."
That is not much of a burden on one patent, but we have goodness knows how many patents which are alive at this point. Perhaps Mr. Frederico will be able to tell you or give you an estimate of how many patents will be effected by this legislation.
Mr. Bryson. How many did you say were extended after the last war?
Mr. STEPHENS. Six patents.
Mr. STEPHENS. But the legislation was only taken advantage of, as I understand it, by three people, each of whom had two patents, so only six patents were affected.
Mr. KEATING. Is not the ownership of a patent a matter of record in the Patent Office?
Mr. STEPHENS. Yes, sir.
Mr. KEATING. So that in the case of patent A where your client, the manufacturer, thought he might go into business on the 13th of next December, making that product, would it not be a matter of comparative ease to determine whether that patent was owned by someone who was entitled to take advantage of this law?
Mr. STEPHENS. Yes. And when we are speaking of one patent that is just a little bit of trouble, but when we are dealing with hundreds of thousands of patents that we work with every day, the problem is greatly multiplied.
Mr. KEATING. But you do not work with 100,000 every day. You, as I see it-you correct me if I am wrong-a specific client coming to you and saying, "I want to go into business at a certain fixed time in the future making this product which is now covered by a patent; can I do it?" And you could determine that the 17 years is up on the 13th of next December, but you would also determine that that patent is now owned by a veteran and you would tell your client, “You are not safe in going into business on that date, because the patent is owned by a veteran, and you cannot go into it until we are sure, either (a) that veteran does not make application for this extension or (b) until his extended time has expired."
Now, what is there difficult about that situation?
Mr. STEPHENS. There is no difficulty as long as the records will show in some way or another that the patentee, or the owner of the patent, is a veteran. I presume the Patent Office would have to establish a separate record to show that, and perhaps mark the copies of the patents.
Mr. Bryson. Mr. Stephens, could we not, if we conclude to give some consideration to the veterans, provide in the law that any veteran patentee, if he intends to take advantage of this extension, must file evidence that he is a veteran in the official Patent Office record by a certain time?
Mr. STEPHENS. Sir, that becomes a matter of the administration of the Patent Office.
Now, please understand me. I am not sitting here arguing against the passage of any particular veterans' bills. I am sitting here saying that the members of my association object in principle to the extension of any patents. We do not think it is a good thing. We only think that if it is done it should be done under the most rigid and careful circumstances.
I am trying to answer your questions as to the mechanics of it, but I find that I seemingly get into the position of attempting to oppose particular bills. I am not authorized to do that. I am just declaring the principle of the association against these bills for the reasons given, and incidentally, I would like to tell you gentlemen that I served in the Navy for approximately 4 years, and I am speaking as a lawyer now, not as a veteran. I am not personally asking for the passage of any of this legislation or opposing. the passage of any of this legislation.
Mr. KEATING. I appreciate that and I think we should be grateful to you for giving us the benefit of your experience here. I realize that it is not a pleasant task to oppose any legislation which is of benefit to the veterans. I am anxious to get, however, the position of your association.
Do I understand, then, that they are simply presenting a principle to us to the effect that we should go slow in extending the 17-year period on patents, rather than taking specific opposition to these bills except as they violate that principle?
Mr. STEPHENS. That is correct. In other words, if any bills extending patents are to be recommended by your committee, we feel that they should be great exceptions, that we are so violently against the passage of any bills extending patents that we feel that it should only be done in a most particular way.
We do not like the idea, yet we do not want to see injustice done.
Mr. CHADWICK. Mr. Stephens, there is one thing that occurs to me in trying to think through your problems. I have not had a chance to read these bills in great detail but the ones that I have looked at contain no express provision under which the veteran may waive the right to extend the patent short of the extension period as provided in the bill.
Would that aid you, generally, to put in a section of that sort?
Mr. STEPHENS. No. Anyone can refuse to exercise his rights. I do not know whether these bills individually set a time within which the veteran must apply for his rights, and if, failing to apply within that time, he shall not get them.
Mr. CHADWICK. Yes.
Mr. STEPHENS. Such a limitation, of course, should be in any legislation which is passed.
In other words, the less the uncertainty, the better off we, as the public, are.
Mr. KEATING. Now, pursuing that just a moment, Congressman Chadwick's suggestion, why would it not be of assistance to you in advising corporation A if corporation A could purchase from this veteran a waiver of his rights, if he had a right to waive? Then there would be something tangible which the concern that wanted to go into business could acquire.
Mr. STEPHENs. That right already exists. An inventor can sell his patent rights, exchange them, or treat them just as though they were ordinary property, so that would not help any in this legislation.
Is that all?
Mr. LEwis. Thank you very much.
Mr. STEPHENs. Thank you very much, gentlemen, for letting me uppear.
r. IEWIs. Mr. Hitzeman, do you care to say anything? Mr. HITZEMAN. Yes, if you please, sir.
STATEMENT OF HARRY H. HITZEMAN, PATENT LAWYER, CHICAGO, ILL.
Mr. HITZEMAN. I have listened with considerable interest to every person who has spoken here, and, starting with Mr. Stephens’ statements, it is my opinion that the expression of the Patent Office is an expression of big business, as contrasted with small business or the individual inventor. There is not any difficulty in finding out through the Patent Office whether or not a patent has been extended, and more than today there is any difficulty in finding out who owns it. All you do is consult the record, and that could be done. The Patent Office has promulgated rules of practice for prosecuting and issuing patents, and they could devise simple rules to carry out any procedure under any of these bills that the Congress passes. However, I have given you gentlemen a prepared statement which I wrote yesterday, which sets forth my views fully. I appear here as a patent lawyer and someone who owns patents and represents a lot of clients who own patents. I know that I have, and they have, suffered as a result of the last 5 years' curtailment of the use of patents. Now, two of the Congressmen have advocated passing bills that benefit only veterans of this war. It is my opinion as a lawyer that that would be unconstitutional, because it is class legislation, for one thing. Secondly, it is my further opinion that a great many of us fought just as hard to win this war at home here as the men and women that put on a uniform to do it. Mr. KEATING. There is plenty of precedent— Mr. HITZEMAN. Sir? Mr. KEATING. Is there not plenty of precedent for special laws applying to those who have served in the armed forces? Mr. HitzEMAN. Yes; but the constitutionality of that—for example, this last clause, to extend the patent for two or three times the length—I doubt very much, if you please, whether or not the courts would uphold that as constitutional. I do not claim to be the greatest lawyer in the conntry, but I do know a little about class legislation and the unconstitutionality of it, and I think in a particular instance like extending the patent laws solely for the benefit of a veteran it might be very well held unconstitutional by the Supreme Court. I was a veteran in the First World War, and yet in this war I could have put on a uniform and fought, but I worked 20 hours a day, more than i day, to help win this war, and I suffered on account of the fact that I could not use my patents, and I am just representative of a lot of other people that are in that position.