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Federal Government provide more than $29 billion in research and development support.

As a result of this huge national investment, thousands of inventions are identified each year which form a valuable source of new products and technology development. Unfortunately, Government policies have inhibited the process by which such benefits are made available to the American consumer. Federal patent policies which were originally designed to protect the public interest by preventing the so-called give away, have in fact operated to discourage contractor bidding, eliminating incentives to innovate or disclose new ideas, and to delay the commercialization of inventions developed under Federal contract. It is ultimately the American public that suffers from these misguided policies through the failure of potentially significant inventions to reach the marketplace.

Together with Senators Stevenson and Cannon, I have introduced the bill referred to by Senator Stevenson, S. 1215, entitled "The Science and Technology Research and Development Utilization Policy Act," which would provide the framework for the establishment and implementation of a comprehensive Government patent policy.

This bill, with its somewhat cumbersome title, was drafted with the following objectives in mind:

First, the Government patent policy as well as the implementing regulations must be uniform in the sense that all agencies operate under the same general rules and procedures;

Second, the policy must permit some flexibility in policy implementation in recognition of the differing missions and statutory responsibilities of the various agencies engaged in research and development activities;

Third, the policy must be as simple as possible and avoid the heavy administrative burden and delay experienced by both the contractor and the Government under current Federal policies;

Fourth, the policy must provide the necessary incentive for private sector participation in Government contracts, and for the rapid development of new technology, in order to maximize the benefits to the public from its R. & D. investment;

Fifth, the policy must foster competition and prevent undue market concentration; and

Finally, the policy must protect the legitimate rights of the taxpayer to any inventions developed under Federal contracts where the specific nature of the research being performed demands full public access to the resulting inventions or precludes granting of exclusive rights of ownership to a private contractor.

S. 1215 is one step this country must take to reverse the national decline in industrial innovation and economic productivity. I firmly believe Americans have lost neither their willingness nor their ability to innovate. Rather, it is the system within which the innovation process functions which must be restructured, providing a more favorable climate for the traditional innovative spirit. The reform of our Government patent policy is the beginning but not the end of that process.

Mr. Chairman, we are indeed fortunate today to have this distinguished group of witnesses, most of whom have considerable practi

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cal experience working with the various Government patent policies.

I would also note that today's first witness, Mr. R. Tenney Johnson, is not only a close personal friend of mine, but a distinguished public servant, having served as General Counsel for three different Federal agencies, and Deputy General Counsel for two other agencies. Mr. Johnson's expertise in the area of Government patent policy is highlighted by his role as an advisor to the Commission on Government Procurement, and as a principal draftsman of President Kennedy's patent policy of 1963.

I look forward with great anticipation to his testimony as well as to those of other distinguished experts in this field.

Thank you, Mr. Chairman.

[The bill follows:]

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Entitled the "Science and Technology Research and Development Utilization Policy Act".

IN THE SENATE OF THE UNITED STATES

MAY 22 (legislative day, MAY 21), 1979

Mr. SCHMITT (for himself, Mr. CANNON, and Mr. STEVENSON) introduced the following bill; which was read twice and referred jointly, by unanimous consent, to the Committees on Commerce, Science, and Transportation and Governmental Affairs with instructions that if one committee orders the bill reported, the other has 60 days in which to act

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A BILL

Entitled the "Science and Technology Research and
Development Utilization Policy Act".

Be it enacted by the Senate and House of Representa

2 tives of the United States of America in Congress assembled,

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4 SEC. 101. FINDINGS.

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TITLE I-POLICY

The Congress, recognizing the profound impact of sci6 ence, engineering, and technology policy on the economic, 7 social, political, technological well-being, and the health and

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1 safety of the Nation as a whole, hereby finds and declares

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(1) The United States has recently experienced a decline in the process of industrial innovation and pro

ductivity which is integrally related to, and adversely impacts upon, domestic productivity, the rate of economic growth, the level of employment, the balance of trade, and the attainment of other national goals.

(2) The national support of scientific and technological research and development is indispensable to sustained growth and economic stability, and it is in the national interest to maximize the benefits to the general public from such investment.

(3) Scientific and technological developments and discoveries resulting from work performed with Government contracts constitute a valuable national re

source which should be developed in a manner consist

ent with the public interest and the equities of the respective parties.

(4) Current Federal policy with respect to the allocation of rights to the results of federally sponsored

research and development deters contractor participation in Government contracts, delays technological progress, and stifles the innovative process.

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(5) The present United States system for the acquisition of intellectual property rights resulting from

privately funded research and development, while fundamentally sound, is in need of modifications to diminish the existing uncertainty and the high costs incurred in enforcing proprietary rights.

(6) There is a need for the establishment and implementation of a flexible Government-wide policy for the management and utilization of the results of federally funded research and development. This policy should promote the progress of science and the useful arts, encourage the efficient commercial utilization of technological developments and discoveries, guarantee the protection of the public interest, and recognize the equities of the contracting parties.

16 SEC. 102. PURPOSE.

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It is the purpose of this Act to

(1) establish and maintain a Federal policy for the management and use of the results of federally sponsored science and technology research and development; and

(2) insure the effective implementation of the pro

visions of this Act, and to monitor on a continuing basis the impact of Federal science and technology

policies on innovation and technology development.

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