FOREWORD Will the Defense Department patent policies be applied to the research and development activities of civilian agencies in the absence of contrary directions from Congress? This report on the Post Office Department's research and development program suggests that such civilian programs are quite likely to follow Defense Department policy with respect to patents unless and until Congress prescribes a different policy. The report was prepared by Clarence M. Dinkins of the subcommittee staff, under the supervision of Robert L. Wright, chief counsel of the Subcommittee on Patents, Trademarks, and Copyrights, as part of the subcommittee's study of the U.S. patent system conducted pursuant to Senate Resolution 53 of the 86th Congress, 1st session. It is the sixth of a series dealing with Government patent practices, the purpose and scope of which are more fully described in the forewords of the recently issued reports on the patent practices of the Tennessee Valley Authority and the National Science Foundation. This report deals with the practices of an agency which was specifically authorized by Congress in 1949 to establish a research and development program, but was not given any specific directions as to how to deal with patent rights. While the purpose of the program is to improve postal service equipment and to introduce new devices which will make the operation of the Post Office Department more efficient and economical, the devices which are being developed may have a much wider application. For example, the Department is presently engaged in developing through private contractors letter and parcel post sorting machinery, which may be used by other Government agencies or commercial businesses handling large volumes of mail and packages, such as mail-order houses. The Post Office Department is relatively new to research and development work, and, in the absence of a directive by Congress, quite naturally turned to the Armed Services Procurement Regulations as a convenient guide for its disposition of patent rights. However, it seems clear that those patent regulations were not designed for use in connection with the development of inventions which may have a wide use in the performance of governmental and commercial functions. For example, one ASPR patent clause which the Post Office Department has adopted prohibits the use of any invention produced under its research contracts "in competition with the contractor or the contractor's commercial licensees." As indicated by the testimony given on behalf of the Railway Express Agency in the recent hearings held before the Senate Post Office and Civil Service Committee concerning fourth-class mail size and weight limitations, the Railway Express Agency regards the Post Office Department's parcel post service as one which competes directly with the service that the Railway Express Agency offers the public. Yet the parcel post service will be a principal user of the machinery in question. Is the parcel post service to be barred from using any of these machines if the contractor chooses to license their use to the Railway Express Agency? Although the Post Office Department's General Counsel views this competitive restriction as no limitation on the Department's right to see that such inventions are made freely available to the Government for its "own use to provide governmental services to the public," it is difficult to understand why a restriction against "competitive" use has any place in a patent clause dealing with research and development of a public service character. The kind of public services that the Government provides should be determined by Congress, free from contractual restrictions which merely reflect the varying views of administrative officials. Unlike a number of other agencies engaged in research for civilian purposes, the Post Office Department also leaves title with the contractor in all cases. While the Department's authority to make this choice may be clear, in the absence of a contrary legislative command, the fact that it has chosen a patent policy primarily developed in aid of the procurement of military supplies suggests a need for specific congressional mandates as to the disposition of patent rights by each civilian agency with extensive research and development responsibilities. JOSEPH C. O'MAHONEY, Chairman, Subcommittee on Patents, Trademarks, and NOVEMBER 5, 1959 PRELIMINARY REPORT AS TO THE PATENT PRACTICES OF THE POST OFFICE DEPARTMENT I. LEGAL AUTHORITY AS TO PATENTS In 1949 the Department was granted statutory authority to establish a research and development program in the following terms: 39 U.S.C. 847-Research and development program; establishment; administration; investigations and studies. (a) The Postmaster General is authorized and directed to establish in the Post Office Department a research and development program which shall be administered by the Postmaster General through such officers and employees as he may designate. (b) The investigations and studies under this program shall be for the purpose of improving existing equipment, supplies, methods, procedures, means and devices used in the Postal Service and of introducing new types of equipment, supplies, methods, procedures, means, and devices for use in such service in order that the businesses of the Post Office Department may be more efficiently and economically operated. (August 16, 1949, ch. 439, sec. 1, 63 Stat. 608.) 39 U.S.C. 847a-Same; utilization of facilities of National Bureau of Standards; assistance from other departments. In carrying out its functions under section 847 of this title, the Department is authorized, pursuant to section 686 of Title 31, or other applicable law, to utilize the research and testing facilities of the National Bureau of Standards and to procure advice and assistance from any department or independent establishment in the executive branch of the Government. * * * (August 16, 1949, ch. 459, sec. 2, 63 Stat. 608.) The foregoing provisions do not expressly deal with the disposition of patent rights to inventions which may be made in carrying out research and development contracts. The Department believes authority to dispose of such rights is derived from the general authority to enter into contracts. Sections 847 and 847a of title 39, United States Code, are regarded as setting to rest any question on that score, and, at best, conferring cumulative authority. In a letter to Senator O'Mahoney of January 23, 1959, the General Counsel stated the Department's position as follows: *** we believe general authority to enter contracts implicitly confers with it authority to agree to such terms and conditions as are reasonably believed necessary to carry out the purpose of the contracts. Sections 847 and 847a require the establishment of a research and development program. |