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. And not on any specific statute?

Lieutenant Commander DoDD. Not on any specific statute.

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 a suit.

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." 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.

Senator WAGNER. In other words, there is no right, is your theory; the Government has no right?

Lieutenant Commander DODD. That is one of the ways of looking at it.

Senator WAGNER. An enforceable right.

Lieutenant Commander DODD. That is one of the ways of looking at the question.

Senator DILL. Then why license these people to use the patent? Lieutenant Commander DoDD. Because that question has not been decided, and until it is decided there is always the possibility of suing them

Senator DILL (interposing). Has the Government any direct licenses? Lieutenant Commander DODD. No, sir.

Senator DILL. Always cross licenses?

Lieutenant Commander DODD. Always and only cross licenses. Senator DILL. Does the Government own any patents other than those taken from the Alien Property Custodian?

Lieutenant Commander DoDD. Yes, sir.

Senator DILL. Does it own any others besides those?

Lieutenant Commander DODD. Yes, sir.

Senator DILL. I am not speaking of those that it takes from its employees.

Lieutenant Commander DoDD. No, sir. I understand you to speak of the sole right and title to patents.

Senator DILL. Yes.

Lieutenant Commander DODD. Yes; the Government has some of those.

The CHAIRMAN. Where did it get those?

Lieutenant Commander DODD. It got those from the circumstances surrounding the invention; that is, those circumstances surrounding the general employer and employee relation.

Senator DILL. But I asked you whether there were any other than those in the employer relation; whether they have gotten any outside of the employer relation and from the Alien Property Custodian? Have you got any patents of this kind: Consider I am an independent and private citizen, and suppose I secure a patent, will the Navy buy one from me?

Lieutenant Commander DODD. In some individual cases.
Senator DILL. It has some?

Lieutenant Commander DODD. It has bought some. About four, sir. And the reason for that purchase was because those inventions were of a technical military nature and the Government wished to keep them secret.

Senator DILL. I am not criticizing; I am just trying to get facts. Lieutenant Commander DoDD. Yes, sir.

Senator BROOKHART. Has the Attorney General ruled that the Government has the right to buy a patent?

Lieutenant Commander DODD. Yes; the Government has the right. Senator BROOKHART. Then I see no reason, if it becomes the owner, why it should not protect it, as Senator Wagner suggested, the same as an individual. I can see a difference in that position and in the policies of how much license fee we are going to charge for the use of it. But if it is in the hands of the Government, it seems to me they ought to protect it and prevent anybody else from using it and holding peo

ple up and make them pay a license on a patent which is inferior to the Government's rights.

Senator DILL. Let me ask you this question: Supposing Congress were to pass a resolution requesting the Navy Department to protect any rights it has in patents, would that be an expression of policy? Lieutenant Commander Dodd. Yes, sir.

Senator DILL. I say request, because in our resolutions we usually use the word "request" instead of "direct."

Lieutenant Commander DODD. That would establish the policy so far as the Navy Department is concerned.

The CHAIRMAN. In other words, you would like to have that action before you proceed?

Lieutenant Commander DODD. Yes; because that is action that will have very far-reaching effect.

The CHAIRMAN. Now that having been settled, if you were a Member of Congress, how would you vote on a matter of that kind? Do you believe Congress should instruct in such matter?

Lieutenant Commander DODD. I should think that it should be optional whether the Government sues or not, for this reason: There is a certain type of patents, or inventions which they cover, that do not flourish until the patent monopoly runs out. They then come into their own and the public benefits thereby. There is another type of patent which only flourishes under the protection of the monopoly. Therefore, if you adopt one policy to cover both, whether that policy is that the monopoly should be exercised, or that the patent should be dedicated to the public-that is what it would amount to no matter which one of those policies were adopted, there would be a certain type of patents which would suffer thereby. And, therefore, it should be optional as to whether the Government prosecutes infringers and thereby maintains this patent monopoly. The CHAIRMAN. The patent that does not flourish until after the expiration of the 17 years is the one that you think would be affected by the policy of Congress compelling the enforcement of patent rights? Lieutenant Commander DODD. Ye

es,

sir.

The CHAIRMAN. The one that flourishes during the life of the patent

Lieutenant Commander DODD. Should be protected.

The CHAIRMAN. That, you think, the Government should exercise its rights over?

Lieutenant Commander DODD. Yes, sir.

The CHAIRMAN. So that you believe that legislation should be enacted which would make it optional with the department to exercise that feature?

Lieutenant Commander DoDD. Yes, sir.

Senator DILL. Coming back to these cross licenses, there is one more question I should like to ask you. As I understand, when firms cross license any patents they may secure, for the use of the Government, that, of course, does not give the Government any right to cross license again what they have secured by cross license? In other words, Atwater Kent gives the Government the use of any patents that he may secure; now, the Government in the use of those patents could not give away any patents that were given to it?

Lieutenant Commander DODD. No, sir; the patents are all nontransferrable.