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with the exotic metals, the refractory metals, and a whole industry sprang up almost overnight. I don't think it follows that that has to be.

Mr. McKay. I don't think it has to be, but I think it has been. There are striking examples on both sides.

Dr. SEAMANS. I really think there has to be a proper balance between the two, and here is where the judgment comes in on how we manage our programs. In planning what we do, we must also take into account what industry is already doing in R. & D., and not just duplicate that.


Mr. Duncan. That raises the point really that has left me unsatisfied here this morning. Most of your research that you are sponsoring, both in and out, is what we call applied research.

Dr. SEAMANS. That is right.

Mr. Duncan. You have an objective that you have in mind. Let me just ask a side question, here, since you have agreed to that.

Do you have anv people just thinking about new sources of energy? Dr. SEAMANS. We could bring in people here that can get into ideas

Mrotic as you woui.could bring inking about

Mr. Duncan. But that isn't what you are doing. You are concentrating on the applied research; isn't that right? You have listed a set of objectives, both near and far term, haven't you?

Dr. SEAMANS. In all of ERDA we have the full spectrum. In our physical research program we have high energy physics. There is nothing that is applied about that.

Mr. Duncan. Do you hire and sponsor some of that?

Dr. SEAMANS. That is in our budget. Then you get into certain work in materials that is nondirective. You really cannot say that it is going to give you a better structure for a particular application.

Mr. DUNCAN. I didn't find any reference to that in the justifications, perhaps because I didn't study it carefully enough. Is it in there?

Mr. GREER. It is under Mr. Evins' committee.
Dr. SEAMANS. What is the total amount?
Mr. GREER. A little over $206 million.
Dr. SEAMANS. $206 million in our budget.


Mr. DUNCAN. Since that is in the other committee, let's stick to this applied research we have talked about here this morning. You have used the term "frequently advancing the state of the art." Then we got into a discussion with the chairman about proprietary information and how you protect it, or do you protect it as it moves into the public domain. You responded you had considerable flexibility as you negotiated the contracts to give some exclusive rights, for instance, or some requirements on industry to put their patents into the public domain on licensing procedures. You have to have flexibility to do that.

How can you advance the state of the art if you aren't fully advised as to what the state of the art is? If industry itself, for example, taking advantage of your flexibility, doesn't feel, as Mr. McKay suggested some industries don't feel, that they can reveal their "trade secrets,”

their patented material, and the patents aren't sometimes very complete protection either, how can we advance the state of the art if we don't have some assurances from industry that they know what the state of the art is? Aren't we then doing what these gentlemen say, spinning our wheels and working it all over again?

Dr. SEAMANS. I think we must know what is going on, and I think if we do our job correctly, that industry will inform us of programs that they have underway that are of a highly proprietary nature. I know that in a number of cases I have visited industrial plants and reviewed work where relatively few outside people have been admitted to see what they are doing. If you take advantage of that, then those doors will be closed and that is it.

Mr. DUNCAN. Does the Freedom of Information Act impede your ability to do that?

Dr. SEAMANS. No, it does not, because that is not Government funds. Mr. DUNCAN. But presumably your purpose in being there is to find out what the state of the art is, and I think that is something you have to know in order to determine, in order to shape the contracts, the proposals that you put out.

Dr. SEAMANS. Sure.

PROTECTION OF INDUSTRY'S RIGHTS Mr. DUNCAN. Have you enough flexibility to be able to assure industry that those so-called trade secrets are not going to be put in the public domain?

Dr. SEAMANS. What I was talking about was a case of just receiving information, where I was admitted into the lab, shown the progress of the work and the results they are achieving.

Mr. Duncan. It seems to me we have to be able to do that, to go to industry and industry have confidence that the work they have done, which they have done for the profit motive, is going to be protected, but then we likewise have to be able to say “OK, if you want us to help you on this, from this point on you are going to have to rely on your patent protections, whatever they might consist of, and your ability to derive revenue from the licensing of those,” because from that point on when Government money goes in the pressures are going to be irresistible, then the competitive forces of the market come into play as those procedures and products get onto the market.

Dr. SEAMANs. Let me just clarify one point. If we enter into a joint arrangement with a company, and patents come out of it, then we can jointly—the Government and industry—share in the licensing arrangements that come out of that.

Mr. DUNCAN. Regardless of the extent? In other words, you do enter into agreements with respect to any further developments in this area?

Dr. SEAMANS. Yes. Mr. DUNCAN. You would jointly share the benefits. Dr. SEAMANS. Right, on an equitable basis. Mr. DUNCAN. And to the extent you share those benefits, then I think the law also requires access to those procedures and processes on a licensing basis, don't they?

Dr. SEAMANS. Yes, they do.
Mr. Evans. Will you yield for a question.
Mr. Duncan. Yes.

INDUSTRY'S WILLINGNESS TO DISCLOSE INFORMATION Mr. Evans. I think the gentleman from Oregon has raised a good point. Could you tell the committee what your experience has been in relation to industry's willingness to open its doors to you or your people to disclose to you on a confidential basis the state of the art ?

Mr. YATES. What arts are we talking about?
Mr. EVANS. The scientific and industrial arts that are involved.

Mr. DUNCAN. Any of these, geothermal, conversion, nuclear, all of these objectives they have delineated in the justifications.

Dr. SEAMANS. My personal view is that they have been very forthcoming when dealing with the senior people in ERDA, which I think is the right way to do it. If I might I would like to have Dr. White comment on this, because he recently joined us from Standard Oil of Indiana, and he might give us a point of view here you will find interesting.

Mr. Duncan. We have always been great competitors.

Dr. WHITE. Generally I would certainly agree with Dr. Seamans that we are experiencing very good reception on this score. I was interested that Dr. Gouse was just down at Exxon Laboratory in Baytown, Tex., last week and came back and reported that he had been shown a new development which I had not even heard about before that may be quite significant which is entirely proprietary. There is no ERDA funding in it. Mr. YATES. Can you tell us the field it is?

Dr. WHITE. Coal gasification to methane in one step which I didn't believe could be done and I am still a little skeptical but what he said was quite impressive. He was not shown all the technical details but the general scope of that project was shown to him as a matter of interest as to what the state of the art is.

Mr. Evans. If the gentleman will yield, could you state it then in the other fashion? You say generally you are well received ?

Dr. WHITE. Yes.
Mr. Evans. Are you ever declined? Are the doors ever shut on you?

Dr. WHITE. I am not aware of a place where we have actually asked to go in and have the door shut.

Mr. Evans. Dr. Seamans, is that true with you?
Dr. SEAMANS. It is true with me, yes.


Dr. WHITE. One other technique that tends to help in this regard, is that we do have the practice, when we have a proposal either from outside or from one of our in-house labs, and we are trying to assess whether it is an advance in the state of the art, of sending that out for review. We send it out under confidentiality to not only academic but also industry people, sometimes competing firms, and the persons who gets it does it on an individual secrecy basis. We sometimes come back with the kind of answer that this really doesn't represent much

of an advance, as we already have in our laboratories stuff that is ahead of this. We are very alert to that sort of flag.

Mr. DUNCAN. None of you have been cited for contempt yet for failure to reveal those communications with industry.

Dr. WHITE. There is a procedure where the proprietary results of industry sent to us and clearly marked are kept proprietary until at least some contract is signed. Mr. DUNCAN. The Freedom of Information Act protects you? Dr. WHITE. Yes.

Dr. SEAMANS. Since you brought that up, we have a recent case. I forget the details of it, but the subcommittee chaired by Mr. Moorehead was investigating it, and they wanted the names of the reviewers. We had already provided the names, not the names themselves but the background of each one of the inside and outside reviewers. We did finally decide that it was all right for the committee to have those names, but in working with the committee we have made it clear that we think it would hurt the process if those names became public.

I really feel that strongly, because pretty soon people will not be willing to serve in this advisory role.

UNSOLICITED PROPOSALS Mr. DUNCAN. One more question then. Somebody mentioned here earlier that you get a lot of proposals from the colleges.

Do I understand then that your research projects are both initiated inside and outside of your agency? You don't define your objectives and put out invitations ? That is one way of doing it.

Dr. SEAMANS. I am sure that on a dollar basis far and away the largest amount of our effort is initiated in-house but it would be wrong I think to imagine that we have all the ideas for new work, and so we review the unsolicited proposals we receive. Mr. DUNCAN. Mr. Chairman, I have no further questions.

Dr. WHITE. You might be interested in knowing that in fossil energy alone we receive 15 unsolicited proposals a week from both academic and private industry. Mr. YATES. What does that mean; what kind of proposals ?

Dr. WHITE. All the way from basic research to "Help us. We have brought it up to a pilot plant stage. We are now ready to spend $50 million, and please give us $49 million."

Mr. McKay. I think that those who are expecting themselves to be pushed along in the academic community are going to come to you because they see no other way at the present time. But there are many companies who are solvent themselves, and they are moving along, but who are scared to death to come and tell you what they have got. You probably don't get them to come and see you unless they have had some experience. Exxon may be badgered to the point that they figure they have got to come around to show you some things. Mr. Yates. Are you saying that Exxon ought to be badgered more? Mr. McKay. That might be one conclusion.

PROPRIETARY DATA Mr. DUNCAN. Will you send me a copy on proprietary rights? Mr. Yates. I think we ought to insert the information in the record. Mr. Duncan. There might be a couple of illustrative forms you use. [The information follows:]

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