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provide for review of such inventions to deteraine their classification as
Any invention reported to either DOE or the PTO found to
contain Restricted Data will be classified in accordance with Chapter 12 of
the Atomic Energy Act.
Paralleling the Atomic Energy Act, the Invention Secrecy Act (35 USC
181-188) allows the PTO to disclose patent applications believed to have
classified subject matter to defense agencies, including DOE.
O's process for making these inventions available and for the
application of secrecy orders under Section 181 have been recently described
to this Subcommittee in the testimony of the Assistant Commissioner of
Patents, Honorable Rene Tegtmeyer. Both the Invention Secrecy Act as
implemented by the PTO, and the Atomic Energy Act, provide somewhat different
but similar restrictions for the handling of inventions or patent applications
classified as Restricted Data or placed under secrecy order.
The secrecy order requires the applicant, before disclosing to others,
to obtain permission from the Pto, which in turn forwards the request to
the agency sponsoring the secrecy order.
This enables DOE to determine if
proper security clearances have been obtained.
Violation of the secrecy
order by the applicant subjects him to criminal penalties (35 USC 186), and
may result in the invention being held abandoned (35 USC 182).
Data must be handled in the manner provided for in Chapter 12 of the Atomic
Energy Act and DOE Order 5650.2, dated December 12, 1978.
Data 18 handled in violation of these requirements, the applicant is also
subject to penalties as provided in Chapter 18 of the Atomic Energy Act.
A patent application circulating under secrecy order within DOE but not
bearing any security markings is handled as if it contains information
classified at not less than the level of "Confidential."
Finally, the Invention Secrecy Act in Section 183 provides that the
owner of any invention who is damaged by the application of a secrecy order
may obtain compensation from the Federal Government.
There is no parallel
provision in the Atomic Energy Act for compensation resulting from the
classification of an invention as Restricted Data.
As to your inquiry regarding patent applications in which the Government
has rights because it was made or conceived by an employee or under a
contract or subcontract, such applications which contain Restricted Data
are filed by DOE with the appropriate classification markings under cover
of a DOE letter requesting that a secrecy order be imposed thereon.
applications have been filed on classified inventions generated by employees
or under our contracts dating back to the days of the Office of Scientific
Research and Development (OSRD) established in 1941 and continuing with the
Atomic Energy Commission (AEC) and its successor agencies, the Energy
Research and Development Administration (ERDA) and now DOE.
With respect to privately developed inventions and patent applications
filed in the PTO, the PTO refers these applications to DOE under Section
151d of the Atomic Energy Act (42 USC 2181d) and Section 181 of the Inventions
When such a patent application bears no security markings,
but is found to contain Restricted Data by DOE, a request for issuance of a
secrecy order is made to the PTO.
In specific response to the inquiries for statistical information, we
have sponsored 1,117 secrecy order renewals in the last year.
924 were issued on OSRD/AEC/ERDA/DOE generated inventions under Government
of the remaining 193, 117 were issued at the request of foreign
governments under mutual security agreements.
The other 76 renewals were
on privately owned patent applications.
Of those patent applications not owned by DOE on which renewals have
been issued, the average age is 8 years for those secrecy orders requested
by foreign governments, and 11 years for the secrecy orders on privately
In view of the large numbers of DOE-owned patent
applications involved, we have provided the requested information by age of
the secrecy orders in a particular time period in the following ten-year
DOE has requested the PTO to issue new secrecy orders in the last five
Regarding the question of whether DOE sponsors secrecy orders on non
Restricted Data inventions, we sponsor many such secrecy orders on our own
patent applications covering inventions that are not Restricted Data but
contain National Security Information.
As you know, Executive Order 12065
does not permit classification of non-government research and development
as National Security Information unless (a) it reveals classified information
to which the producer was given prior access, or (b) the government acquires
a proprietary interest in the product. Accordingly, the Department presently
sponsors no secrecy orders on privately owned patent applications that do
not contain Restricted Data.
In regard to DOE procedures for evaluating requests from inventors for
compensation under the Atomic Energy Act, Section 157 of the Atomic Energy
Act (42 USC 2187) provides for the designation of a Patent Compensation
Board to consider applications for compensation, awards and royalties based
upon claims under the Atomic Energy Act.
In addition, the Board has been
given authority to consider claims based upon the Invention Secrecy Act (35
Since its inception, the Board has considered 40 applications.
Thirty-eight of the 40 applications were for awards and just compensation
were made for compensation and award under Sections 151, 153 and 157 of the
Atomic Energy Act of 1954, as well as under 35 USC 183.
The claim was
Bettled for $120,000, and all rights in and to the invention were assigned
to the Government without stipulation of which of the several allegations
were relevant to the settlement.
Mr. PREYER. Let me ask you one of the basic questions involved in all of this; a due process question. If we amend the Atomic Energy Act to provide criteria under which information might be classified as restricted data, that is, it would not be publicly available or already publicly acknowledged by the Government, would it be advisable to create a procedural structure for adjudication of disputes which might arise under such criteria?
I am assuming that many of the due process elements that are included in the Administrative Procedure Act would not be appropriate in such a setting, for example, public hearings, on-the-record testify, et cetera. Are there some procedural safeguards which could be implemented to protect the rights of those with property rights in the information without endangering national security? There is no compensation, for example, under the Atomic Energy Act the way there is under the Invention Secrecy Act-could such a process be more efficient and time saving than either the Government injunctive remedy or individual lawsuit? That is an easy question.
Mr. SEWELL. Mr. Chairman, I will take that easy question and turn it over to Mr. Fygi.
Mr. Fygi. Thank you. Your question has several dimensions and assumptions. Foremost among them is that there is at issue with respect to weapon design information a proprietary aspect which, in our reading of the 1954 act, the Congress then resolved concluding that there was to be no such private proprietary interest in weapon design information. In fact, that was among the reasons that the Compensation Board was established in the 1954 act, to provide compensation in the transition, as it were, conceptually from the scheme of the 1946 act. Now that doesn't resolve the entirety of the question, of course, because many of these issues arise in the context of information which is restricted data but is not necessarily directly related to weapon design. For example, some restricted data involves the design of nuclear vessel propulsion plants. Some such restricted data involves the design and technological features associated with isotope separation and other means of uranium enrichment.
As to those types of issues, perhaps there might be some merit in an approach such as you have suggested. But there also would be some costs, I believe, in that the ultimate classification judgments, for example, those that were at issue in the Progressive case, were not only dependent upon technological and scientific fact, but sound judgment in anticipation of what events might occur as a result of proliferation of that type of information. So it is a mixed question of judgment and fact. The judgment was not without its political aspect in the international context. Indeed in this case those judgments were made at exceedingly high levels of Government.
I would propose then that were such a scheme in place that tended to provide an administrative process of some elaborateness for resolving these disputes as they are called, that you would establish such a scheme at the expense of the imposition of that level of judgment that I just described. In other words you would have an ALJ or something like that making decisions that properly are made by a Cabinet Secretary.