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Senator Dill. Is there any law. now that prohibits it? Is there any court decision that says you can not?
Lieutenant Commander DODD. The question is one which, from the strict standpoint of law, has not been definitely decided.
Senator Dill. Has a case gone to the courts? Has the Government tried to sue on its patents at any time?
Lieutenant Commander DODD. No, sir. The road has been traveled this far: The Attorney General quite recently has given the matter his earnest consideration and has not yet announced his opinion. The question that he was considering is as to the Government's legal right to sue on a patent.
The CHAIRMAN. Has there been an opinion by any other Attorney General on that question?
Lieutenant Commander DODD. No, sir.
The CHAIRMAN. This is the first time the Attorney General has given it his consideration?
Lieutenant Commander DODD. This is the first time the Attorney General has given it his consideration.
Senator BROOKHART. On that proposition you would recommend the same procedure against either plaintiff or defendant in these collateral suits? That is, if either one is infringing the Government's patents, you would proceed against either?
Lieutenant Commander Dodd. Yes; certainly. Senator BROOKHART. I think Congress must define the policy, whether anybody that is using them shall be sued, or how much to charge them.
Lieutenant Commander Dodd. Yes; that is for Congress to decide.
Senator Dill. They can only grant licenses that are nonrevocable and nonexclusive.
Lieutenant Commander Dodd. At the present time, sir, the Navy Department, having submitted the matter to the Attorney General, and having an opinion from the Attorney General that it is legal to cross-license under a definite form of cross-license agreement, a copy of which I have here—this particular form has been approved.
The CHAIRMAN. By whom?
Lieutenant Commander Dodd. By the Attorney General, sir. The Attorney General has said that it would be legal to enter into cross-license agreements under this particular form. And since the Attorney General has rendered that opinion we have had a definite policy of entering into cross-license agreements on this form, but no other.
Senator Dill. Is this form the one which provides that the person who makes the cross license, that the Navy Department is to have the right to all future licenses of the patentee, and he will have none of the Government's. We were told yesterday by the representative of the Radio Protective Association, manufacturers of radio parts, that they were offered an agreement under which all their patents
, present and future, were to be used by the Government, and they were to have the present patents of the Government, but no future patents?
Lieutenant Commander Dodd. That is correct, sir. That is the terms of this agreement.
Senator Dill. Has anybody taken any such licenses?
Lieutenant Commander Dodd. No one has taken any other licenses. I have here a list of the cross-licensees.
Senator Dill. Has any firm taken any such license?
The CHAIRMAN. Enumerate a few of them, and put the rest in the record.
Lieutenant Commander DODD. Yes, sir. The Atwater Kent Manufacturing Co., the Splitdorf Electric Co., the Wired Radio Corporation, the Pathe Radio & Phonograph Corporation, the Zenith Radio Corporation.
(The list of cross-licensees of the Navy Department is printed in full, as follows:) Acme Apparatus Co.
Mohawk Electric Corporation. Advance Automobile Accessories Co. Mu-Rad Radio Corporation. American Bosch Magneto Corporation. Music Master Corporation. Atwater Kent Manufacturing Co. Pacent Electric Co. (Inc.). Brandes Product Corporation.
Pfanstiehl Radio Co. Bremer-Tully Manufacturing Co. Philip E. Edelman. Buckwalter Radio Corporation.
Pilot Electric Manufacturing Co. C. D. Tuska Co.
Premier Electric Co. Colin B. Kennedy Co.
Reichman Co. Crossley Radio Corporation.
Sagamo Electric Co.
Sonora Phonograph Co. (Inc.).
Stewart-Warner Speedometer Corpora-
The Operadio Corporation. General Phonograph Corporation. Waltert Manufacturing Corporation. Hartman Electric Manufacturing Co. Wired Radio (Inc.). Jewett Radio & Phonograph Co. Zenith Radio Corporation. Kellogg Switchboard & Supply Co. Pathe Radio & Phonograph CorporaKodel Radio Corporation.
tion. The CHAIRMAN. So Mr. Schuette's organization was not asked to do anything that others were not already doing?
Lieutenant Commander Dodd. I have the documents in that case. I will read
Senator KEAN (interposing). I do not think that is necessary. I think we know that.
Senator Dill. Insert that into the record.
Lieutenant Commander Dodd. I was going to read to you the letter which the Secretary of the Navy wrote to Mr. Schuette.
The CHAIRMAN. It is short, and you may read it.
Lieutenant Commander DODD. It is short, and I will read it. [Reading:)
DEPARTMENT OF THE NAVY,
Washington, D. C., July 2, 1928. Radio PROTECTIVE ASSOCIATION (INC.),
134 South La Salle Street, Chicago, Ill. Sirs: Referring to your letters of April 14, 1928, and May 8, 1928, regarding the granting to you of a license differing in several respects from the standard Navy form for cross licenses approved by the Attorney General, you are advised that the subject has received careful consideration, and that the conclusion has been reached that the Secretary of the Navy does not have the authority to enter into a cross-license agreement under the terms suggested by you.
Should the Radio Protective Association desire a cross-license under the standard form mentioned above, the Navy Department will be very glad to enter into such agreement with your company. Very respectfully,
CURTIS D. WILBUR,
Secretary of the Navy.
Senator Dill. Where does the Navy Department get its authority to make these cross-licenses?
Lieutenant Commander Dodd. The Navy Department did not embark upon this policy of cross-licensing until it had submitted the question as a matter of law to the Attorney General and received an affirmative answer from the Attorney General, with a specific form.
Senator Dill. I come back to my question. Where is the authority? Where does the Attorney General find the authority? Is it a specific statute or decisions of the courts which make the law, or what is it?
The CHAIRMAN. In the Attorney General's opinion did he quote his authority?
Lieutenant Commander Dodd. He went into it very much in detail, sir, and gave his opinion on the question that the granting of a license was not a parting with Government property; that it was merely a legitimate use of Government property; and while no—
Senator Dill (interposing). Then he simply decided it on the right of ownership?
Lieutenant Commander Dodd. On the right of ownership; yes, sir.
Senator Dill. What I want to get at is why they would have authority to grant a cross-license by which they get all future patents of the cross-licensee and the cross-licensee is not to get any of their future patents, and would not be able to make what you might term a mutually binding agreement.
Lieutenant Commander Dodd. You will find the authority for that in the authority which any Government official has in the disposition of Government property, of obligating Government property. It is questionable whether any Government official has the authority to obligate in any way Government property which is not yet in being.
Senator DILL. That is what I want to get into the record.
Lieutenant Commander Dodd. And that is the reason why no Government official has been given that authority.
Senator Dill. But owing to the advantages which will be gained on the licenses now owned, he assumes that the ownership gives you authority to make those licenses?
Lieutenant Commander DODD. Yes, sir.
Senator Dill. I am not complaining of the licenses, but only want to get at the facts of it.
Lieutenant Commander Dodd. Yes, sir.
The CHAIRMAN. In these matters the Government has certainly been efficient. Senator Dill. I think it has certainly protected its own interests
. I may be wrong, but I understood Colonel McMullen, of the War Department, to say that the department heads with whom the Attorney General had consulted, had recommended, or rather agreed that the Government had such a right in monopoly of radio ownership in patents that it could sue on infringements, and made such recommendations to the Attorney General. I may have misunderstood him.
Lieutenant Commander DODD. The recommendation the Navy Department made to the Attorney General was that, for the purpose
of settling the question, it might be considered advisable to bring
Senator BROOKHART. The Navy Department is also of the opinion that the Von Bronck patent is valid, is it not?
Lieutenant Commander Dodd. The Navy Department has studied carefully all the cases where the Von Bronck patent has been in suit, and finds the reasoning of the Supreme Court of Canada very persuasive. However, the Navy. Department is not prepared to say that they consider it an open and shut proposition at the present time, because there is no way of predicting how the suit would turn in a court in the United States of appellate jurisdiction.
The CHAIRMAN. If the Attorney General should rule, which I now understand he has under consideration, that the Navy Department has a right to sue a citizen for infringement, would it be the disposition of the Navy Department to sue alleged infringers?
Lieutenant Commander DODD. It would not be the disposition of the Navy to sue. If, on the other hand, there was a definitely established policy that the patent represented Government property and that any custodian of that property who did not realize for the Government the full benefits of that property and was lax in his duty, then, of course, the Navy Department would sue; I mean, would start suit.
Senator Dill. That is just what Senator Couzens asked you. If they are infringing, will you sue?
Lieutenant Commander Dodd. At the present time?
The CHAIRMAN. No; if the Attorney General should rule that you had the authority to sue an alleged infringer, would you sue?
Lieutenant Commander Dodd. No, sir. The CHAIRMAN. Why not? Lieutenant Commander Dodd. Because of the question of policy, which it is not the function of the Navy Department to decide, sir.
The CHAIRMAN. Oh, I know; but the Navy Department usually determines its own policy. If the proper authority of the Government should say to the Navy Department, “You have complete authority to sue on the Von Bronck patent, or any other patent; you will use your judgment as to whether you will sue or not, what would be the policy of the Navy Department with reference to Government property? I understand you to say it would be not to sue.
Lieutenant Commander Dodd. Not to sue.
The CHAIRMAN. In face of the fact that this Government property was being used or infringed? In other words, you might as well say to a citizen, “You may go on the Government's private property and take possession and the Navy Department will not sue, or take any action.” It is a complete analogy.
Lieutenant Commander DODD. The Navy Department's policy has been to protect the Government in its right to use, to make, and have made for its own use these inventions.
The CHAIRMAN. We understand that. We have had testimony to that effect, and it is commendable, and that is true of any Navy property. But this is property the same as a navy yard; and I can not conceive of not starting a policy which would protect a patent ownership the same as you protect the real property in the navy yard. I just do not get the reasoning why you say that is a policy which the Congress should determine, rather than a department of the Government which is responsible to protect Government property. Just why?
Lieutenant Commander DODD. Because of its far-reaching effect, sir. If the Government is to maintain a patent monopoly, to sue infringers of patents, and to exercise its patent monopoly to the fullest extent and build up a patent front, it will have very, very far-reaching effects.
Senator BROOKHART. Is that not all the more reason the suit should be brought?
The CHAIRMAN. Of course, even in that event if there is no reason why you can not license the use of it and get an adequate revenue the same as you would, perhaps, by lease or sale or surplus property of the Government
Lieutenant Commander DODD (interposing). I think I see what the Senator means, please, sir. I understood I was being asked as to the disposition of the Navy Department, and I first said if it becomes the duty of the Navy Department to sue the Navy Department will sue, sir. If you put it on the ground of the disposition, the Navy Department would be disposed to wait until this question of farreaching policy had been decided some place besides in the Navy Department.
Senator Dill. But the question was, if the Attorney General ruled that you had the right to go ahead and bring the suit, with the Canadian decision in front of you, which you say is very persuasive in its reasoning, would the Navy Department attempt to protect its interests and its ownership in a patent such as the von Bronck patent? You say recommendations have been made to this attorney general; he has it under advisement now; it is for him to say what the policy shall be.
Lieutenant Commander Dodd. Yes, sir.
Senator DILL. Once he says that it is perfectly proper for the department to do this, then what is to be the attitude of the Navy Department about these patents, and about suing?
Lieutenant Commander Dodd. I can answer that by saying that the Navy Department has already recommended that in that event this question of policy be raised by bringing a suit.
Senator Dill. That is what I have been trying to get you to say. Senator WAGNER. Commander, it is not clear in my mind how you distinguish between an individual protecting his rights under a patent, and the Government protecting its rights under a patent. În each case there is an infringement. Why should an individual enforce his rights, and the Government not enforce its rights? You said that had something to do with a far-reaching policy?
Lieutenant Commander Dodd. Yes, sir.
Senator WAGNER. What is the distinction? I do not see it very clearly.
Lieutenant Commander DODD. A patent monopoly is something which is given by the people through the Government to an individual to recompense him for the disclosure to the people of his invention; it is a reward to the inventor. If by a circuitous route that patent monopoly gets around and vests in the Government, there are plenty of analogies whereby through a merger of that nature the right is extinguished.