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STATEMENT OF ARTHUR DICKEY, CHAIRMAN OF THE LEGISLA
TIVE COMMITTEE OF THE MICHIGAN PATENT LAW ASSOCIATION, DETROIT, MICH.
The CHAIRMAN. Mr. Arthur Dickey is the next witness. Mr. Dickey, I believe you represent the Michigan Patent Law Association.
Mr. DICKEY. That is right.
The CHAIRMAN. What is your official connection with that organization?
Mr. DICKEY. I am chairman of the legislative committee of the organization.
The CHAIRMAN. We will be very glad to hear you, Mr. Dickey. Do you have a prepared statement ?
Mr. DICKEY. I do not have a prepared statement.
Mr. DICKEY. Arthur W. Dickey, Detroit, Mich., a member of the Michigan Bar.
In the beginning, I wish to state, concerning the patent provisions of the bill, S. 1579, which have been considered by the Michigan Patent Law Association, it is our opinion that patents-that it is not necessary to include patents in the bill; in the present law and
The CHAIRMAN. Pardon my interruption, but Mr. Dickey, there was a gentleman here the other day from New York who represented some patent association and he at that time suggested an amendment for our consideration. Have you seen that amendment?
Mr. DICKEY. I just saw the modified form of the bill this morning here.
The CHAIRMAN. But you have not seen the suggested amendment by the gentleman who was here from New York ? Mr. DICKEY. I just glanced through the provisions of the bill. The CHAIRMAN. In line 18, page 4! Mr. DICKEY. Yes. The CHAIRMAN. It reads: Provided, however, That if, within ten days after the requisitioning under this Act of any property other than tangible personal property, the owner of the property shall file with the President a written declaration and consent that the property may be used by or for the Government for national defense or other governmental purposes on the basis of compensation to be determined in accordance with section 2 of this Act, the title to the property shall not be taken over or disposed of under the provisions of this Act unless the owner refuses to execute such leases, licenses, or other grants to the United States as may be necessary to give effect to the declaration and consent which he has filed.
Mr. DICKEY. That, I think, is entirely unnecessary, in view of the laws that are in existence at the present time, and have been.
As you well know, the ownership of the patents cannot do the Government any good. It can only do the owner, that is, the individual owner good, because all the Government needs or wants is the use of the invention that is described in a patent and that is always available. The patents are public documents, published for
all to read who wish, and the inventions are all described in those patents, both foreign and United States patents, so far as that goes, and if the Government desires to use any of those inventions, all it has to do is to read the patents and go ahead and use it. It can negotiate with the patent owner for å license if it desires. If it cannot reach an agreement with the patent owner, then it can use it in any event, and the patent owner can do nothing other than present his claim to the Court of Claims. The patent owner cannot hinder the Government in the use of the invention at all. He is relegated entirely and solely to his remedy before the Court of Claims.
Senator DOWNEY. Does that power mean that the United States Government could authorize some private corporation to use the invention for the purposes of national defense and in manufacturing for the Government?
Mr. DICKEY. Oh, yes, yes. I do not think there is any doubt about that. The Government can make a contract with any person it wishes to use any patented invention it wishes, and under such cases under the present law, the only recovery that the patent owner has is by his suit in the Court of Claims.
Senator DowNEY. Mr. Chairman, from my own information, I must admit that I have not myself understood why it is necessary to give the Government power to seize patents, because I have understood that the Government virtually has the power now.
Mr. DICKEY. It has; even in peacetime it has the power.
Senator DOWNEY. Would the effect of this bill be merely to give the Government the power to seize patents and sell them to some private individual?
Mr. DICKEY. Well, yes, sir; the ownership of the patent gives also the right to grant licenses. That is, the fee ownership of it, you see, and to dispose of it.
Now, if the Government takes the patent away from the individual owner, the patent owner, under this bill, it can keep it, for instance grant licenses wherever it desires, or sell the patent. It deprives the owner of his entire beneficial interest in that patent, except what he could get from the Government under the compensation clause here, which may or may not be adequate.
Now, if the patent owner is left with the patent, when this war or this emergency, and so forth, is over, then he is able to go ahead as he does in peacetime and to get his remuneration from the patent by granting licenses to others. He has the title still and he can do that.
If the Government takes the title, then it is forever gone, unless he can get it back from the Government, and that is quite a difficult undertaking
Senator DOWNEY. Do you not think that paragraph or sentence that the chairman read will cure that difficulty?
Mr. DICKEY. No; I do not think so, because it still leaves the Government in position to take the title to the patents, which, as I say, it does not need, unless the owner refuses to execute such a license, and there are comparatively few now or who have ever refused to do that, and you are going to find a very small minority who will ever do such a thing as that in any case, and the Government can take the title to that property.
Well, under the laws that exist at the present time, the Government can use that patent; can use that invention, and the owner has recourse in the Court of Claims, and that is all that is left. The Government already has the right to use the invention.
The CHAIRMAN. Judge Patterson, according to my recollection, and it has just been called to my attention by Colonel Watt, made mention of the fact they are particularly interested in that section of the bill pertaining to patents, in reference to foreign patents.
Mr. DICKEY. Well, they can handle foreign patents, if they wish, entirely separate and apart from the patents belonging to citizens of the United States. They did in the last war. They seized and administered them and retained titled to them, I believe, even after the war; and granted licenses under that.
Senator DOWNEY. I think they sold some of the foreign patents. Mr. DICKEY. Yes; they did.
There is no reason, if they are afraid of foreign patents, or patents owned by foreigners, for the confiscation or requisitioning of titles of patents owned by citizens. That places the citizen in the same class as an alien enemy.
Senator KILGORE. Mr. Chairman, may I ask a question. That is talking about foreign patents or inventions not patented in the United States but protected by treaty; is that what is meant?
Mr. DICKEY. No; I think what is meant there, Senator, is that patents owned by foreigners or alien enemies.
Senator Kilgore. We have a treaty covering patents owned by foreigners, for instance, Germany, to the effect that we will not infringe on their patents in consideration of their not infringing on the rights of the patentees in the United States! Mr. DICKEY. No; there is nothing like that that I know of. Senator KILGORE. We do not have any treaties on patents?
Mr. DICKEY. We have what are known as international conventions, which covers the filing of applications in different countries. That is, they provide the time within which they may be filed.
Senator KILGORE. In other words, a foreign invention to be protected as a patent in the United States would have to be patented in the Patent Office of the United States?
Mr. DICKEY. That is right.
Senator KILGORE. And if we had the idea of the invention in the United States-in other words, if we knew the formula or plan, for making whatever was covered by the patent, it would not be protected, and we could go ahead and make it with or without the consent of the inventor?
Mr. DICKEY. Yes; if it were not patented in the United States; assuming that there was a foreign patent, a British patent, or a German patent on a particular process or article, and there was no United States patent on that, the United States or anybody in the United States could use that foreign patent in the United States and the foreign government could do nothing about it, or the foreign owner could do nothing about it. He must have a United States patent to have protection.
Senator KILGORE. When the Secretary of War was talking about foreign patents, he mentioned patents owned by foreign nationals.
Mr. DICKEY. I think that is so; yes. I think that what he had in mind, and that is what they had in mind in the last war when they
seized patents; that is, the Alien Property Custodian, I believe, took them over, and you can do the same thing in this war, if you wish, as to foreign-owned patents. I do not see any necessity for putting the citizen owner of a patent in the same category as possibly an alien enemy owner or treating his property in the same way. I think that is rather unjust procedure.
The CHAIRMAN. Do you object to the paragraph altogether?
The CHAIRMAN. You have stated that the Government has power sufficient under the law at the present time to cover any rights it wants then?
Mr. DICKEY. That is right, and I have listened to a good many arguments about the matter and a good many statements, and I have not seen anything, yet, or heard described any situation yet, that requires the requisitioning of a patent owned by a citizen, that is, taking over the title of it.
Of course, the one thing of paramount interest is the condition that will obtain after this war is over, after the emergency is over.
Now, the title to a lot of these patents will get into the hands of the Government. They probably will not need them after the emergency is over. What is the Government going to do with them? They may have sold or disposed of them in the meantime. The owner can never get them back. He is lost. This gives the power and places the power in the President and in the agency which he may appoint, to transfer patents from one owner to another, completely without much, if any, recourse.
Now, the value of a patent is pretty difficult to determine; that is, the total value of it at any one given time. You can determine the value of its use for a period of time, perhaps; but you see a patent runs for 17 years from the date it is granted now and that patent may become valuable and it may be used by industry during the beginning of its life, or perhaps during the middle of its life, or perhaps nearing the end of its life, or may be during all of its life. It is impossible to say just how much use can be made of it.
Now, the effective life of the patent, most patent attorneys will agree, is not the full 17 years. It is a period considerably shorter than that, because industry comes along to a place where it can use the patent or the invention, and may use it for a year or two or three and drop it and that is all there is to it. That frequently happens.
So, as I said, it is pretty difficult to say what the value of the invention is at any one given period, and unless there is some finding and clear necessity to deprive citizens of their title in that sort of property, we do not thing it should be done, and so far as we have been able to see there has not been anything presented yet that requires that that be done. Senator DowNEY. Mr. Chairman, may I ask a question there? The CHAIRMAN. Certainly.
Senator DowNEY. Did the chairman state that the language which he read on page 4 was prepared by a representatives of one of the patent associations?
The CHAIRMAN. Yes; a gentleman who appeared here the first day of the hearing from New York.
Senator DOWNEY. What is his official position?
The CHAIRMAN. He is a member of the New York Patent Law Association, I think. That is my recollection. He made a suggestion in connection with that, at the time that Judge Patterson was here the other day, for the second time, and it is my recollection that we inquired of him as to whether or not he objected to that language of the proposed amendment and he said that he did not.
That was Mr. Byerly.
Senator Thomas, do you desire to ask any questions?
Senator KILGORE. I do have one more question I would like to ask on this section 2, Mr. Chairman. This section 2 as suggested says that if the Secretary of War, or the Secretary of the Navy shall, upon a written finding, find that such sale or disposition is necessary “to insure production in sufficient quantity of the patented commodity or articles for defense purposes,” it may be sold.
Mr. DICKEY. The Government can make a contract to have it produced in whatever quantities it desires without this and without owning the patent.
Senator KILGORE. That is what I am trying to get at. Is there any condition under which it would be necessary in order to get a manufacturer to produce something that it would be necessary to give him a patent on it, or to sell the patent to him?
Mr. DICKEY. No, no; not that I conceive of, with the authority that the Government has at the present time. And, that does not help the situation a bit, you see, because the Secretary of War and the Secretary of the Navy apparently can make that recommendtion and finding without any hearing and just upon their own initiative, so far as that goes. That is of no protection.
Senator KILGORE. In other words, it could be an ex-party summary proceedings, without any evidence of any kind ?
Mr. DICKEY. That is right.
STATEMENT OF KARL FENNING, CHAIRMAN OF THE COMMITTEE
ON PATENT LAWS OF THE NATIONAL COUNCIL OF PATENT LAW ASSOCIATIONS, WASHINGTON, D. C.
The CHAIRMAN. The next witness is Mr. Karl Fenning. Mr. Fenning, I believe that you represent the National Council of Patent Law Associations, with offices in the city of Washington.
Mr. FENNING. That is correct, Mr. Chairman. I am chairman of the committee on patent legislation of the National Council of Patent Law Associations, representing—it is a voluntary organization-representing all of the patent law associations in the country