Scientific American, v 43 (ns) no 3, p 32, 17 July 1880
Government Use of Patents
Inventors are to be congratulated upon three recent decisions of the courts which open the way to an efficient judicial remedy for use of patents by government officers. There has been a vague idea that obtaining a patent does not protect the inventor against gratuitous use of his invention by authority of the government. This view was founded upon English practice; an English patent is understood to be inoperative against the crown. But the reasons for this do not prevail in America. In this country a patent is a compact with the inventor to induce him to disclose his invention for the public benefit. In England patents are a preserved class of "monopolies" -- a privilege which the sovereign is allowed to give to favored persons.
Although the right of an inventor as against the government has been for some years recognized, to see how he could have a remedy has not been so easy. As long ago as 1858 a claim was preferred to the Secretary of War for payment for government use of the Sickles cut-off. The government contracted with Merrick & Son to build a steamboat. The contractors attached the cut-off to the engine without paying royalty, considering that government was entitled to the free use of the invention. Sickles applied to the Secretary of War, and that officer asked the opinion of the Attorney General. The Attorney General of the day, Judge Black, advised that the government was equally bound with an individual to pay a royalty; and that the Secretary might pay a reasonable one if there were an appropriation available. This "if" gravely embarrasses the inventor's right in most cases. What he has needed has been an efficient remedy in the courts. But the courts cannot render judgment against the government for wrongs done by its officers. Nor can they enjoin the government directly from using an invention; and if they could, or could stop the use by enjoining the officers personally, this is not what the inventor wishes; he wishes his invention used and a royalty paid.
In 1863, and again in 1868, suits were argued in the Court of Claims seeking to recover royalties for government use of inventions. In the first of these cases the Warden of the United States Penitentiary in the District of Columbia set up six patented broom making machines in the prison, and employed the convicts in making brooms. There was nothing like a bargain between him and the inventor; and the Court of Claims said that for want of some contract binding the government to pay, that court could not render any judgment. In the other case, a patented army tent was adopted by the War Department and a contract was made by direction of the Secretary, with the inventor, to pay him a royalty. For reasons connected with his participation in the rebellion the payments were stopped; but on proof of the special contract, he recovered judgment. Obviously these views gave no protection in all that large class of cases where executive officers were disposed to use inventions as if they were free to the government.
Three recent decisions present the subject in new aspects and indicate the law to be that if, upon request of the inventor, an officer competent to contract for use of an invention makes use of it without payment, the Court of Claims may award compensation to the inventor upon a theory of an implied promise to pay him, while if the invention is used against the inventor's consent, or by an inferior officer or contractor, the individual thus infringing is personally liable in substantial damages, recoverable in the circuit courts. In one of the cases, Lieutenant McKeever, being the patentee of an improved cartridge box, submitted it to the War Department in the hope that it might be adopted. But upon the theory that government is not bound to pay royalties, none was paid to the inventor. He brought suit in the Court of Claims. That court decided that the government has not the right to use an invention, and that the cartridge box had been submitted by the inventor to the department, the presumption must be that the government used it under an implied license and upon an obligation to pay a reasonable royalty. It could not be supposed that the inventor intended to give a gratuitous leave or that the Secretary intended a lawless infringement. A judgment for a substantial compensation founded on this theory of contract was therefore awarded.
Another suit was brought against an officer -- the Postmaster of New York -- who refused to enter into any contract with the inventor, believing and claiming upon English precedents that he ought not to do so. There was, therefore, no ground for a suit in the Court of Claims, but the Circuit Court held the officer personally liable for damages as an infringer. The patent in this case was for an improvement in canceling the letter stamps. It enabled the clerks to cancel the stamp on a letter by the same implement and stroke which imprinted the postmark. The device obviously diminished the time consumed in stamping letters by nearly one half; and the pecuniary saving realized in the New York office during the term covered by the suit was shown to have been $:63,000. That is to say, the office had saved, and presumably had remitted to the government at Washington, $:63,000 of postal moneys, which he otherwise must have expended in paying salaries of stamping clerks. The court adjudged him personally liable for this sum to the inventor. The fact that he had paid it over to government did not protect him. The inventor was declared entitled to his damages, and the task of coaxing the money back from the Treasury was left to the Postmaster.
The third of the decisions mentioned, earlier in date than the others, applies the same principles to the simpler and easier cases where certain contractors, because they were manufacturing for government, assumed to use, as they supposed government had the right to do, the complainant's invention without paying him. But the Circuit Court very promptly told them that they had no such privilege.
These decisions are subject to the ultimate approval of the Supreme Court in Washington. Should they be finally sustained they will enable an inventor to seek redress in the courts, whatever may be the way in which his invention is pirated under pretense of a use for government.
Secret processes in manufacture are not uncommon now and here, notwithstanding the reasonable cost of a patent and the facilities for obtaining it. In England, where the cost and trouble of procuring a patent is much greater than here, these secret processes and receipts are very common, and the visitor to manufacturing establishments is frequently interdicted from a thorough exploration. The practice is a perfectly proper one, as an inventor as much owns the product of his brain and skill as the money he has earned; but there is always more or less risk attending the attempt to keep secret any profitable knowledge. If only one man possesses the secret, it is liable to be lost by his sudden death, to be possessed again only by a re-discovery. And although a certain prominent public lecturer may have attached undue importance to what he calls "the lost arts," it is undoubtedly true that there have been lost to the world really valuable facts in mechanics and chemistry and other arts and sciences by these attempts at secreting facts.
But there are patents in use which belie the term. Anything that is patent is "known" or "seen," the terms being synonymous. Yet there are methods of manufacture, compositions of material, and machines for operation which have been patented and yet have never become known to the public. In some of these instances this withholding of public information is designed and intentional, the holders of the patents working it for their own profit, and believing that to be better for them than sharing it and receiving a royalty. It must be acknowledged that these are wiser than those who depend for their monopoly on their confidence in human nature -- in human fealty -- and run the risk of losing their advantage by death or unfaithfulness, for at the worst those who would share in the profits of the patented article may be compelled to pay fairly for it.
The number of these private patents which are held and used would surprise one who did not have good opportunities to ascertain the facts. And some of them are wonders of ingenuity and skill. One noted only a few days ago is a case in point. Among the productions of a busy concern recently inspected was that of drawer-knobs of wood. The extremely low price at which these knobs were sold was a surprise until the process of manufacture was witnessed; then it was apparent that the trifling price allowed a handsome margin for profit. A boy sat at a machine placing bored cubes of wood on a projecting pin that presented itself almost as fast as he could conveniently handle the blocks. Yet, every time he placed a block on the pin, a finished knob was thrown off, requiring only the insertion of a plug with which to secure the knob to the drawer, and varnishing to be ready to pack for the market. When the machine is prepared with the proper cutters it will turn almost any form of knob required, and being fed with the material in blocks it is absolutely automatic. "Only two of these machines were made," said the superintendent. "Where is the other?" was asked. "Out in the barn," was the answer. Here was a combination of self-acting tools that had been patented, and yet not used except in the concern where it originated, and so prolific was it in product that a second machine had been found unnecessary.
This is but a single instance of the use of an unknown though patented article. Some of the work done and some of the modes of work and action of these machines are very curious. It would quite astonish the reader if it was proper to describe the action of machinery seen in operation recently at a bolt-making concern. Some of the processes in the production of "bright goods" -- those from stiff polished wire --practiced in certain concerns, and some of the operations in sheet metals, although patented, are unknown to "the trade" generally.
There is another class of unknown patents which are very like undeveloped mines of legally enjoined enterprises, of no profit to the owners and of no use to the world. Some of these patents lie useless because the holders have not the wisdom, energy, or money to push them. There are men who are keen enough to see the failures and note the shortcomings of others and cover their unprotected openings, yet who cannot understand their own advantage. They can invent and discover, perfect and improve, but they hardly know what to do with their creation or improvement. To be of any profit to them it should be made of use to others; but they neglect proper means of publicity, and eventually the invention or improvement is forgotten until some "live" man brings it out in different forms, but perhaps no better shape, and claims the honors and reaps the profits. It is then, if ever, these slow coaches heave in sight. Then they begin to bluster about prior claims and prior discovery. But generally the enterprising reinventor takes all the honors, gives his own name to the invention, and gets the emoluments that attend on success. -- Boston Journal of Commerce.
The Relations of Cheap Patents to Industrial Prosperity
The factors of American prosperity are many.
We have a magnificent country, to begin with; a territory of continental scope, made fruitful by a climate unsurpassed in kindly adaptation to needs of varied agriculture and the requirements of industrial activity. Our mineral resources are unrivaled in richness and variety. Our complex population embodies no small part of the best pluck and energy and intelligence of all civilized nations. Our free institutions favor individual and associated activity in all legitimate directions. With us men are respected as men and honored according to their deeds; the thoughtful laborer, whose practical sense or constructive ability adds new force or utility or convenience to the common possessions, far outranks in popular estimation the thoughtless inheritor of wealth or social position, however honored or useful his ancestry may have been. The laws are framed to guard the rights and liberties of all; and each man's sphere of action is limited only by the inevitable limitations of his personal force, intelligence, and integrity.
Under such conditions progress and general prosperity would seem to be inevitable, so inevitable that minor conditions might be safely left out in taking account of the great factors of national well being. But other nations, which do not share our present prosperity, are not destitute of like conditions favorable to industrial success. Some in addition enjoy age, the prestige of power, long accumulated wealth, an industrial history covering many generations, and priority in the markets of the world, which unite to give them advantage over the most favorably situated new country with its newly established industries. In the front rank of such countries stands Great Britain, which for many years has been the workshop of the world, and still retains a commercial supremacy which tells immeasurably in favor of her mechanical industries, in giving them a commanding position in the world's markets. Yet the trade of Great Britain languishes under a serious depression, which threatens to become permanent through the increasingly successful rivalry of other industrial nations -- Germany, Belgium, France, and pre-eminently the United States.
The causes of this relative if not absolute industrial decline on the part of Great Britain is not far to seek. At a recent meeting of the Institution of Mechanical Engineers a prominent speaker charged the responsibility upon British inventors and engineers. They had failed to keep abreast of the times. They had allowed the inventors of other countries to displace their products even in British markets. The question was taken up at the August meeting of the London Association, and while the inaction of British inventors was admitted and deplored, the blame was traced to the working of the British patent system. Said the essayist of the occasion, Mr. John Standfield: "The chief cause of our commercial suffering and stagnation is a barbarous law, which to a very great extent prohibits science from developing the resources and strength of the empire." Just before Mr. Standfield had attributed the rise and progress of the British empire wholly to the inventive genius of its people, coupled with the manufacturing resources of the country, pointing out the fact that the great and important inventions patented in England during this century have not only contributed more to the greatness of the empire than all that was done in the previous five centuries, but have brought nearly all the wealth which England now possesses. Even where the sources of national wealth lay underground, in mines of coal and iron and copper, such wealth could never have been developed except for machinery invented for the purpose. But invention is now less active in England than in France, Belgium, and the United States, and England is losing ground in consequence. This loss of trade, says Mr. Standfield, "may be directly attributed to our (i.e. England's) driving abroad or suppressing a very large portion of the seeds of our prosperity. America is the only country that treats practical science fairly, and she is consequently our principal competitor." Further on Mr. Standfield says:
"The cheap patent law of the United States has been and still is the secret of the great success of that country ... The invention we suppress takes root freely in the United States, which, consequently, supplies our marts with large quantities of labor-saving tools, whereas if our laws were fair and equal we should supply their marts, and use the proceeds for purchasing their grain without impoverishing our country by a great loss of capital as at present."
In the subsequent discussion this point was dwelt upon at great length. How can it be expected, it was asked, that English engineers and inventors can compete with their brethren in the United States when the American can get twenty-five patents for the money which has to be paid for one in England? Very few inventors can pay the fees demanded by the English Patent Office. "The result is," said one speaker, "one-third of our inventors are driven to America, and another third are buried, the secret of their invention still with them." And this obviously covers but a part of the national loss, since the possible but never-to-be developed inventors in English workshops probably out-number many times the actual inventors who undertake to put their ideas into working shape. This was put very clearly by one of the speakers. "He had heard it said in every quarter of the globe that English workmen had little or no inventive genius, although they improved things very well, but upon examination he said it would be found that the names to most of the American patents were English names; and he felt certain that, if the cost of a patent in England were the same as in America, instead of 5,000 patents, the English should take out 45,000 to the Americans' 30,000. If placed on the same footing as the Untied States, a great impetus to trade would follow. It was evident that there was something wrong when America could pay �9 where England paid �6 per ton of iron, and 9s instead of 6s per day for labor, and yet beat the English in the open market. He thought it was the duty of the Board of Trade, when the country was losing its trade, to inquire as to the cause of it. There was only one reason for it, and that was the abundance of labor-saving tools used by the Americans, because their mechanics could get all their appliances protected so cheaply.
In the course of his remarks the essayist pointed out that by suppressing native genius through heavy patent fees, England had driven away many national industries in which she had once held a foremost place. The pianoforte trade was one, London being rapidly stocked with instruments made in New York. The watch and silk trades had been driven out of Coventry and Clerkenwell, while machine made watches were being developed in America, where labor was 50 per cent dearer. Said the speaker: "The American cheap patents and labor-saving tools alone account for Coventry's and Clerkenwell's misery and decay, and for England's serious loss of revenue and national income. If our workmen were allowed to become inventors they would prove quite as well able to design and manufacture machinery for the construction of cheap watches as the Americans. On the present system our best mechanics, if they have any ambition, are compelled to emigrate to America, where alone they can find an opportunity of utilizing their genius."
Further on the speaker said: "The American patent laws have given the inventors of such small but generally useful articles as sewing machines such a good opportunity of universally introducing their inventions that it is now not worth the while of any manufacturer here or elsewhere to attempt to compete with the American houses. There are 4,000 skilled artisans employed in the Untied States in this small manufacture alone. While American organs of numerous descriptions are not only excellent but cheap, there is not a single cheap English organ known to the public.
"What has occurred to our piano and watch trade is ow occurring -- if it has not already occurred -- in regard to the manufacture of locomotives and many other manufactures, to the partial ruin of our trade, wealth, and empire."
We might continue these forcible and instructive citations, but the limit of our space forbids. The arguments brought forward to prove from American experience not only the sound policy but the absolute necessity of lower patent fees in England are not needed here. The moral of the discussion, however, should not be overlooked by the friends of American industry. While our greatest rival in the industrial world is learning from our experience the wisdom of extending to inventors the encouragement which comes from a just and inexpensive recognition of their rights the American people must not be deluded by specious sophistries into an abandonment of the position taken by the framers of our Constitution with regard to inventions and letters patent therefor. The wisdom of granting patents for inventions is no longer a subject for discussion. The sound policy of carefully guarding the inventor's rights, against infringements, and of keeping down the fees for issuing the necessary papers, is equally well established. Yet as soon as Congress meets again we may expect a puzzling variety of covert assaults upon the patent system under the guise of bills for the amendment of the patent laws -- assaults which will demand the constant watchfulness of every friend of American industry. Inventors and their friends should see to it that they are not misrepresented at Washington by men uninstructed with regard to the uses and benefits of the patent system. They should take pains not to further the election of candidates known to be in sympathy with those who have sought and still seek to break down the legal safeguards of the property rights of inventors and patentees, as provided by the patent laws. They should take especial pains to lay before their representatives in both houses such information as will enable the framers of our laws to avoid the snares which clever agents of anti-patent associations are sure to weave in bills ostensibly drawn to "promote industry" and to "encourage invention," or protect the "innocent" users of what does not belong to them.