Annual Report of the Commissioner of Patents To Congress for the Year ending December 31, 1888

Laid before the House of Representatives by the Speaker, January 31, 1889, referred to the Committee on Patents, and ordered to be printed.

Department of the Interior
United States Patent Office
Washington, D.C., January 31, 1889

To the Senate and House of Representatives of the United States of America in Congress assembled:

It is provided by section 494 of the Revised Statutes that
 

The Commissioner of Patents shall lay before Congress in the month of January annually, a report giving a detailed statement of all moneys received for patents, for copies of records or drawings, or from any other source whatever; a detailed statement of all expenditures for contingent and miscellaneous expenses; a list of all patents which were granted during the preceding year, designating under proper heads the subjects of such patents; an alphabetical list of all the patentees, with their places of residence; a list of all patents which have been extended during the year, and such other information of the condition of the Patent Office as may be useful to Congress or the public.

Since the date of my last report there has been little or no change in the conditions under which this Bureau existed. The country has passed through an exciting Presidential election, which, together with the consideration of political and economical questions involved, invariable attracts not only the attention of the people, but Congress itself, for months before as well as after the event, from matters of serious import in relation to many matters of public importance. Such appears to have been the result with reference to many needs of the Patent Office in relation to its business affairs as well as changes and modifications in the patent laws. The suggestions I then made were deemed pertinent to the condition of the Office, and as the conditions have changed only in becoming more pressing and urgent, I feel authorized in renewing them.

There are certain subjects which I regard as of paramount importance, to which the attention of Congress should be directed in order that appropriate legislation may be enacted, with a view to improving the law applicable to patent property and the condition of the Patent Office for the commodious and expeditious transaction of public business.

Room in the Patent Office

For several years the annual reports of my predecessors have called the attention of Congress to the utter inadequacy of room and facilities for conducting the business of the Patent Office. This building, I am advised, was constructed from the fund of the Patent Office -- a fund which was not raised by taxation upon the people, but was an accumulation from fees paid in by the inventors of the country, and it may not be inappropriate to say that the inventors themselves, as well as their representatives, attorneys, and others, are properly insisting upon the idea that this business ought to be at least so far devoted to the business of the Patent Office that ample room will be provided for its conduct, and facilities afforded which will secure the consideration of applications for patents, and the issuance of the same without unnecessary delay, expense, or inconvenience. But the building is now occupied by the Secretary of the Interior, the Commissioner of the General Land Office, and the Commissioner of Patents. The result is, owing to the increase in business of the Government in each of these various branches, that neither the Secretary of the Interior, the Commissioner of the General Land Office, nor the Commissioner of Patents has sufficient room to conduct the business with the dispatch and promptness which the public is entitled to expect. The various divisions of the Patent Office are crowded into narrow, inconvenient, and, in many instances, unhealthy limits. The records and drawings and other material, which should be conveniently arranged and made accessible in proper rooms, are stored in corridors and by-way places, where classification is almost impossible, and where access can only be had to the particular subjects desired after long search and delay. Not only this, but great quantities of valuable records, descriptions, specifications, and drawings are constantly exposed to the danger of conflagrations involving the safety of the entire building. It needs only an examination or investigation to demonstrate the absolute necessity that exists for making some change in the arrangement between the bureaus occupying this building in order that each shall have proper room and facilities to discharge its respective functions. The force under the control of the Commissioner of Patents is scattered and located in remote parts of the building on different floors to such an extent that in order to communicate with the various divisions, transfer records back and forth, and conduct the business, much more time and a greater amount of labor are required than would otherwise be involved. If some arrangement could be made by which the force could be located conveniently and compactly, in my judgment almost if not quite enough could be saved in the curtailment of expenses and saving of time to provide for the rental of another building which would meet the demands of either one of the other bureaus mentioned.

The Commissioner of Patents is not possessed of sufficient information to suggest what arrangement should be made, or whether it would be advisable for the Government to rent other buildings in which to locate any one of the bureaus, or whether such bureau should be transferred to some other of the public buildings; but the fact is pointed out that the Commissioner of Patents ought at least to be furnished in a building constructed out of the patent fund with sufficient room to conduct the business of the Patent Office conveniently, expeditiously, and without delay to its patrons.

I most urgently call the attention of Congress to this subject and request consideration.

Official Gazette

Under the present statute the Patent Office publishes 6,500 copies of the Official Gazette, of which 2,265 copies are sold and delivered under subscription at the price of $5 per year. Under the provisions of the act of May 18, 1872, 3,221 copies are distributed to public libraries, members of Congress, and public officers. This publication is one of the most useful and complete of the kind which has ever been published. Its usefulness and importance are well known to Congress, and need not be dwelt upon. It will not be inappropriate, however, to call attention to the mechanical features of the publication, the requirements involved for photolithography, and the method of printing the same. This work contains a complete illustrated and defined history of art, so far as covered by patents, in the United States, from the time of its first publication down to the present day. As is well known, the drawings which accompany every application for a patent are necessarily required to be reproduced and made a part of the patent itself when it is issued. Under the present system this photolithographic copy of the drawing, reduced in size, is published by the Office to meet a demand for copies coming from all parts of the United States and from foreign countries. It is not within my power at present to state the number of copies of patents, specifications, and drawings which are called for; but the demand is great, and the charges made for these copies furnish an important source of revenue to the Office. In order to meet this demand it is necessary, as just stated, that the drawing be reproduced of a size requisite to be made a part of the patent and to be conveniently sent to persons requiring copies. This involves the necessity of employing photolithography. It may not be generally known that the Official Gazette, excepting the front and closing pages, containing opinions and decisions of the courts and the Commissioner and the index, is a purely photolithographic production. The pages containing the drawings and the claims in type are photolithographed.

For several years Congress has appropriated about one hundred and thirty thousand dollars per year to provide for the production of copies of patents, designs, trademarks, pending applications, and for the reproduction of exhausted copies. This photolithographing is required by statute to be done by contract. On several occasions experiments have been made to have this work done elsewhere than in the city of Washington; but in every instance of which I am aware the experiment proved a failure, the work either not being up to the required standard of excellence or being so delayed as to practically interfere with the work of the Office and prevent the prompt issuing of patents. The inconvenience attending these experiments has been so serious that for several years Congress has inserted in the appropriation bills the requirement found in the act approved March 3, 1885, as follows:
 

Said photolithographing or otherwise producing plates and copies referred to in this and the two preceding paragraphs to be done under the supervision of the Commissioner of Patents, and in the city of Washington, if it can be done there at reasonable rates; and the Commissioner of Patents, under the direction of the Secretary of the Interior, shall be authorized to make contracts therefor.

The contracts entered into for the performance of this work have generally been made to run from the beginning to the expiration of the fiscal year. Prior to the 30th of June, 1887, the present Commissioner directed an inquiry to be made, and sent an agent to the principal Eastern cities to ascertain at what rates work of this character could be done in those cities, and received what is believed to be entirely reliable and satisfactory information that the rates fixed by the present contract for doing this work are below those which would be demanded elsewhere.To explain in greater detail the usefulness and manner of conducting this photolithographic work, I quote from the report of my immediate predecessor:
 

Under the practice which now obtains in this Office, on Friday morning of each week preparations are begun for the patenting of all applications which have been allowed and in which the final government fee has been paid during the week next preceding. To secure a proper reproduction of such cases, it is necessary that the original drawings be transmitted to the office where the work of photo-lithographing is performed. On each Friday morning the drawings which are ready are sent to the photolithographer, where the proof sheets are prepared. At noon of the same day these are returned to this Office and another lot of drawings taken. About four o'clock of the same day proof sheets of these last-mentioned drawings are returned, and other drawings again taken; and so this work of photo-lithographing continues day by day. Upon the return of the proof sheets to this Office careful comparison with the original drawings must be made by the employees here, and imperfect sheets (which amount to about five per cent of the whole) must be corrected and returned without delay.

From the fact that the original drawings must be sent to the photolithographer for reproduction, and when it is considered that these drawings constitute the only illustrated record in the Patent Office of the inventions involved -- as under the present rules of the Office models are dispensed with -- it is apparent that any loss or damage thereto would not only greatly embarrass the Office but result in serious injury to inventors. Doubtless, in view of these considerations, a requirement was inserted in the present contract that the original drawings and corrected proofs must be returned to the Patent Office within one and one half day from the delivery to the contractor of such original drawings.

It is not absolutely impracticable that the work of preparing the Official Gazette be performed elsewhere than in this city, provided the place be not too remote. This undoubtedly would be attended at times with serious inconvenience. For manifest reasons, however, the work of preparing the current issues of patents must be done in this city, and the proper reproduction elsewhere is simply impracticable, if not impossible. Inasmuch as proof sheets of the photolithographs of the current issues are used in the preparation of the Official Gazette, it need hardly be said that this work entire can be probably be more cheaply performed by one firm than by several independent firms or contractors.

I have no doubt that this work should and will in time be done by the Patent office itself. It should not be dependent upon contractors. When the patent system is revised, corrected, and improved, as it probably should and doubtless will be in the not distant future, this important subject will be at least carefully considered.

The appropriation of Congress for the present fiscal year was --
 

    For Official Gazette                              $44,000

    For copies of patents, designs, trademarks, 

        exhausted copies, etc.                         90,000

Laboratory

The attention of Congress has been in former reports of the Commissioners of Patents repeatedly called to the need in this Bureau of a laboratory containing the necessary apparatus for testing inventions relating to electricity,, and to conduct experiments pertaining to processes and products involving chemical results. This necessity is one which scarcely needs illustration or explanation when it is considered that many of the most important and valuable inventions relate to these two classes of art. Electrical processes and apparatus -- such as the telephone and improvements in telegraphy -- are so well recognized in importance and value as to require no comment, and yet the determination of whether a new invention has been made in these arts, or an improvement involving novelty and utility, can be reached only by means of proper testing apparatus. This is also especially true in the field of chemistry -- processes for the treatment of iron, producing by chemical means new qualities, and resolving crude iron into fine steel. Such subjects are being continually presented, and the examiner in charge is called upon to determine whether these results are accomplished by the processes claimed. The assertions of the applicants are supported by affidavits of parties in interest and by statements which appear to be reliable, and yet, in the absence of some means of testing the truth of the facts claimed, it is impossible for the Office to determine with that degree of certainty which should exist whether the inventor is novel and useful and should be covered by a patent.

I recommend that some reasonable appropriation be made to provide for the purchase, from time to time, of apparatus and material suitable for a laboratory for these purposes.

Employees

The business of the Patent Office is constantly increasing. Occasionally there is a slight falling off in the number of applications for patents; but this continues for a time only, when the increase begins again. The number of patents issued,however, is not an accurate criterion of the amount of business done in the Office. The examination of an application for a patent involves an examination of the state of the art for the entire world. The issuance of patents, as well as other publications, constitute prima facie a bar to an application the same as the issuance of a patent for the same invention in this country does. Consequently the mass of matter to be examined by the examiner in each class of art is increased each year by the patents and publications of the year. The field to be investigated and examined grows in extent year by year, increasing the time and labor requisite for a proper examination of an application for a patent. Besides this, the demands upon the Office for certified copies of records and drawings and for copies of patents are constantly increasing. The number of assignments and other instruments sent to the Office for record is also increasing, and the correspondence is accordingly increased. The number of applications requiring examination which were received during the last year was 41,351, which, in round numbers, averages 800 per week. The number of patents and certificates of registration of labels and trademarks during the same period was 21,892, averaging 421 per week, showing a percentage of not quite fifty per centum of rejected applications. It is evident that the number of applications will hereafter increase, as well as the general business of the Office. To transact this large and important business requires the necessary force and the requisite room and facilities. I have already referred to the crowded conditions of the force in the Patent Office. The model room, which originated in the suggestions of Thomas Jefferson, who insisted that the Government should establish a museum showing and illustrating the progress and advance of art from the beginning of the Government, has been curtailed and limited by the construction of rooms for examiners. The scientific library is packed and crowded within such narrow limits that its usefulness is greatly impaired. By the last appropriation made by Congress for the Patent Office the Commissioner was authorized to appoint two additional Principal Examiners to enable the organization of new divisions in the Office. It was not until the latter part of November that a room could be secured for carrying into effect this provision.

In my last annual report, resting under the confident expectation that the Bureau of Land Office would be removed and additional room and facilities extended to the Patent Office, I expressed the belief that, with the increased advantages, the present force would be competent to transact the business and keep up the work; but the changes contemplated did not occur, and today the conditions are less favorable than before. The necessity for largely increased room is not limited alone to the business, but the health and ordinary comfort of the employees are seriously involved. As heretofore stated, a great number of the rooms occupied by the employees are poorly ventilated, unhealthy, and are only adapted for storage.

Legislation

Attention was called in the Commissioner's last report to Congress to certain changes and modifications of the statutes relating to patents. Since such time experience has only confirmed me in the propriety of my former suggestions, and I herewith renew them in connection with others.

1. Date of the patent

Section 4885 of the Revised Statutes provides --
 

Every patent shall bear date as of a day not later than six months from the time at which it was passed and allowed and notice thereof was sent to the applicant or his agent; and if the final fee is not paid within that period the patent shall be withheld.

This provision enables an applicant who fails to pay the final fee within six months after the allowance of his application to prolong the monopoly of his patent the period of six months, and it not infrequently occurs that parties having what they regard to be valuable inventions permit their applications to forfeit in order that they may avail themselves of section 4897, which allows them to make a renewal application for the same invention upon the payment of a new fee, but without filing any new papers, the original application, specification, and drawings being used. A new allowance is thus obtained of an application for the same invention, and this allowance may remain for six months after the expiration of the intervening two years before the party takes out his patent. The result of this practice is that, unless the application is barred by a public use which may intervene, an applicant has it in his power under these statutes to prolong the term of the patent which he may secure for an almost indefinite period.

I respectfully suggest that section 4885 be amended so as to require that the term of the patent when issued shall begin with the date on which the application was passed and allowed, and notice thereof sent to the applicant or his agent, applicant of course being allowed six months within which to pay the final fee and take out his patent, and that all renewals authorized in case of a forfeiture for non-payment of final fee be limited to the same claims, except in case of inadvertence or mistake, and that when so renewed the term of the patent begin with the date of the original allowance. The justice of this provision, as well as its wisdom, will be apparent from a consideration of the fact that in issuing the patent there arises by implication a contract between the Government on the one hand and the patentee on the other that the latter shall have the exclusive enjoyment of the patented property for a definite period, at the expiration of which period the property becomes that of the public. The United States extends to patentees more liberal protection and for a longer time than any other Government -- 17 years --and it is neither just nor right to the public which is thus liberal and generous that there shall be found under this legislation methods by which the inventor can defeat the provisions which contemplate a termination of the monopoly, and be able to prolong its enjoyment for many years beyond the period contemplated by law.

2. Limitation of term of United States patent by foreign patent.

Section 4887, after declaring that no person shall be debarred from receiving a patent in this country for his invention or discovery, nor shall any patent be declared invalid by reason of the invention having been first patented or caused to be patented in a foreign country, provides --
 

But every patent granted for an invention which has been previously patented in a foreign country shall be so limited as to expire at the same time with the foreign patent, or, if there be more than one, at the same time with the one having the shortest term, and in no case shall it be in force more than seventeen years.

It is understood that the object of this legislation originally was to prevent an inventor from allowing the people of foreign nations to come into the free enjoyment of his invention at an earlier period than was permitted the people of our country, which earlier enjoyment resulted from the fact that the term of American patents, as just stated, is much longer than any allowed by foreign governments, so that it was impossible for an American inventor to take out a foreign patent without disclosing and making public his invention after the expiration of the shorter term in such foreign country. In the meantime the American people were excluded from the free enjoyment of the invention during the period intervening between the expiration of the foreign patent and the American patent. But I believe those conversant with the subject have never seen any wisdom in this provision of the law. A great deal of trouble and annoyance have resulted from it to inventors, both American and foreign, without, so far as is known, advantaging any one.

It is evident that the American patentee is entitled to 17 years of protection under the patent granted him by this Government. There ought to be no distinction between an American inventor who takes out a patent at home but none abroad and one who takes out patents in both his own and some other country. Yet the American patentee who omits to take out a patent abroad makes his invention public and free in all the countries of the world during the entire period, because his American patent becomes a publication which discloses the invention and prevents him from taking out any patents in foreign countries under the systems existing there, so that in such cases the people of foreign countries acquire the free use of an invention from the date of its publication in America, while the people of America submit to the monopoly enjoyed by the patentee during the entire period of 17 years. The consequence of these conditions is that if the American patentee takes out his foreign patent first his domestic patent is limited in term to the short duration of the patent abroad. If, on the other hand, he takes out his American patent first, he is barred from taking out any patent under the foreign systems, which provide that any publication of a patent shall bar a patent in those countries. This inequity of the law has forced inventors both in America and abroad, at much trouble and expense, to arrange, wherever it was possible, to have their foreign and domestic patents issue on the same day, so that neither of the conditions alluded to could attach.

It is also suggested, in view of the fact that the number of Americans taking out patents abroad very largely exceeds the number of foreigners who take out patents in this country, that these conditions of law have operated much more disadvantageously to Americans than to foreigners, and that therefore there should be some modification in the law.

These difficulties and others which need not be elaborated in this connection have become so well recognized, for they not only exist between Americans and foreigners, but between the different nations of Europe as well, that for some years past representatives of various governments have met together for the purpose of adopting and establishing articles of an International Union for the Protection of Industrial Property. Conventions were held in Rome and at Paris, and finally articles of a union were adopted on the 20th of March, 1883, acceded to by Belgium, Brazil, Spain, France, Guatemala, Italy, the Netherlands, Portugal, Salvador, Servia, and Switzerland, the latter state being assigned the position of intermediary, through whom those adhering to the Union were to communicate with other States in relation to its objects. Subsequently other states gave their adhesion and became members of the Union, viz: Great Britain, Tunis, Norway, Sweden, the Dominican Republic, and the United States. (A copy of the articles and protocols constituting this Union is attached to the last annual report of the Commissioner of Patents to Congress.)

The adhesion of the United States to this Union was ratified on March 29, 1887. The purpose of this Union is to provide that persons who have made applications for patents in one of the States of the Union shall have a definite period thereafter within which to file their applications in other countries as of the same date at which their original applications were filed, and that no publication or use of the invention during that period can deprive the applicants of their right of priority in all the States in which such applications were filed. It will be seen that this provision was intended to meet one of the very difficulties existing under section 4887 of the Revised Statutes, and which was heightened by the requirement that the term of the American patent should be limited by any patent issued to the patentee in foreign countries.

The advantages to American citizens under this Union are set forth in Article 4 of the Convention, to the effect that any person who has filed an application for a patent, or who has applied for the registration of a Trade Mark in the United States, shall be entitled to priority in other countries of the Union as against persons making similar applications within a period defined. A person having applied for a patent in this country is entitled to have his case considered, if filed in another country, the same as if filed simultaneously with the application here.

There is great advantage in this in all countries where the patent is granted to the first applicant, which is generally the case in Continental Europe and England; but it unfortunately happens under section 4887 that every patent granted in this country for an invention which has been previously patented in a foreign country is limited to expire with the foreign patent having the shortest term. It is well known that under the American system an examination of all applications must be made before the patent issues, and generally five, six, or seven months elapse after an application is filed before a patent issues. The result is that the American inventor who desires to avail himself of the advantages of the treaty is in danger of having his foreign patent granted first, for the reason, as just stated, that such foreign patent issues almost immediately after the application is filed, and therefore necessarily the term of his domestic patent is abridged by it.

This is the manner in which this condition of things affects the American inventor; but the foreign inventor who comes to this country for a patent is not thus injuriously affected, because there is no provision under the European system that their patents shall be limited by the duration of an American patent; and if there were such, it would produce no limitation, because the American term, as already stated, is generally much longer than the terms provided by most of the European States. In my opinion, there is no reason for continuing this limitation contained in the last clause of section 4887. While it stands it is almost a complete bar to the enjoyment of the privileges of this Union between the various States named and the United States. The repeal of this clause has been suggested in the reports of the Commissioners heretofore. It is a source of much vexation to the inventors and of trouble to the Patent Office; it is out of harmony with the spirit of our patent law, and, in my judgment, it ought to be repealed.

3. Caveats

Under section 4902 of the Revised Statutes, relating to caveats, it is provided that any citizen of the United States may file a caveat; also, that "an alien shall have the privilege herein granted if he has resided in the United States one year next preceding the filing of his caveat, and has made oath of his intention to become a citizen." Here is a denial by implication of the right of an alien who has not been a resident and made oath to file a caveat. But under the treaty or International Union, above mentioned, there is an expressed provision giving to citizens and subjects of foreign states the same rights and privileges with respect to industrial property that are by such foreign States, members of the Union, extended to the citizens of other States members thereof. It may well be doubted whether this treaty can effectuate itself as a law and authorize the citizen of one of these foreign States who has not resided here one year and made the oath to file a caveat, although by the law of such foreign State the privilege is freely extended to an American citizen. I recommend that section 4902 be so amended as to provide that so long as the United States remains a party to said International Union and said provision remains in force citizens of the States members of said Union which extend the same privilege to American citizens may be allowed to file caveats in the Patent Office without regard to residence or oath.

4. Assignments of patents

Section 4898 provides that an assignment, grant, or conveyance shall be void as against any subsequent purchaser or mortgagee for a valuable consideration without notice unless such instrument be recorded in the Patent Office within three months from the date thereof. In my opinion, this requirement operates unjustly in providing that an assignment, if recorded after three months from the date thereof, shall have no effect as constructive notice to a subsequent purchaser or mortgagee for a valuable consideration. This provision, in my judgment, should be modified so as to declare that while the assignment should be valid without recording for the period of three months from and after its date, thereafter it should be void against any subsequent purchaser or mortgagee for a valuable consideration without notice, unless it be recorded in the Patent Office prior to the date of such subsequent purchase or mortgage, so that should the assignee fail through forgetfulness or accident to file his instrument of assignment within three months he might still file it for record at a subsequent period, and it should then give constructive notice from the date of its actual filing.

5. Money paid into the Treasury by mistake

Section 4935 provides for the payment of fees to the Commissioner of Patents, or to the Treasurer, or any of the Assistant Treasurers of the United States, or to any of the designated depositories, national banks, etc. All moneys received at the Patent Office from every source whatever are required to be paid into the Treasury as received, without any deduction for any purpose. Section 4936 provides that the Treasurer of the United States is authorized to pay back any sum or sums of money to any person who has through mistake paid the same into the Treasury or to any receiver or depository to the credit of the Treasury, as for fees accruing at the Patent Office, etc.

The Commissioner of Patents has the unquestioned authority to correct a mistake occurring in his Office, and to refund to any individual who has paid money to the financial clerk through mistake or accident if such correction be made before the money has been covered into the Treasury or placed in a depository of the Treasury. Such corrections are occurring constantly by reason of mistakes in making change and from demands made on account of applications which either are not filed or are withdrawn on account of some impropriety or irregularity in their presentment; but when the money has been covered into the Treasury the Commissioner of Patents no longer has the power to correct such mistakes, and as it frequently occurs that the mistake is not discovered until after the money has been covered into the Treasury the party in interest is required to go through the somewhat tedious process of applying to the Treasury and furnishing proofs before he can obtain the correction of the mistake. Generally all evidence of the mistake is disclosed in the records of the Patent Office, and the Secretary of the Treasury is uniformly required to make examination and reference of the matter to this Office before acting on the application. The Patent Office is thus put to the same trouble of inquiry and examination as it would be were the whole matter in the hands of the Commissioner of Patents. The amounts involved are always small sums -- either the first filing fee of $15 or the $20 final fee, or some small sum involved in making change. I can see no reason why the Commissioner of Patents should not be authorized to make all corrections of mistakes of this character which occur in his Office and to refund the money, and I recommend that authority be given for that purpose.

6. The attorneys' fund

In this connection I desire to call attention to what may be regarded as equitable claims on behalf of a number of patent attorneys against the Patent Office resulting from a defalcation on the part of the late financial clerk, Mr. Levi Bacon. The claims grew out of the following facts and practice formerly prevailing in this Office: The statutes of the United States require that all payments be made into the Patent Office for copies, records, or work to be done, shall be tendered in advance or simultaneously with the delivery of the copies, records, or work; but persons were constantly sending for such copies of records from remote parts of the country, not knowing what the cost would be, and the Office had been in the habit of responding to such requests with an estimated cost of the work. Thus the delivery of the copies or other work desired was considerably delayed. On the other hand, many parties were in the habit of remitting a larger sum of money than would be required, and directing the Office to furnish the copies of records immediately and return the change. There grew up in the Office, in consequence of the difficulties attending this method of transacting the business, the practice of extending a credit to patent attorneys in good standing and requiring them to remit the amount of their accounts once each month; but after some years' experience considerable sums of money were lost in consequence of the death, disappearance, or inability of the attorneys to pay. In 1878 Mr. Commissioner Spear issued an order authorizing persons dealing with the Office to deposit with the financial clerk a special fund, to be drawn against as they saw proper. After the issuance of this order it was the practice of the financial clerk to receive the money thus deposited and place it in envelopes, upon the back of which was kept the account between the Office and the attorney. The fund was regarded as a private fund, at all times the property of the attorney, no part of which went into the public funds or into the Treasury except as it was drawn against, and the sum then so drawn was applied and paid over into the Treasury. The balance on hand was always regarded as the money of the individual, subject to his order and liable to be withheld at any time he might desire to have it returned. On the death of the financial clerk, Mr. Bacon, in June, 1887, it was found that the various balances which should have been in these envelopes were gone, and that no account could be given of this so-called "attorneys' fund," or "miscellaneous fund," as it was sometimes termed. At the same time it appeared that the Office had these various attorneys charged with copies, records, and other material furnished which should have been, and but for the defalcation would have been, paid for by the sums of money in the various envelopes to the credit of the parties in interest; but the moneys not being found, these accounts were regarded as just and valid claims against attorneys, and it was held that the facts that each at some previous time had had in the hands of the financial clerk sufficient money to provide for the payment of these accounts could not be regarded as liquidating the same. The Commissioner of Patents entertained the view that an officer of the Government could not incur a liability without the express provision of law, and that he had no authority to receive private deposits and make the Government liable for them, or to secure such deposits either by the money of the Government or by their equivalent in work, copies, etc. In his opinion the case was very much the same as though the attorneys had come to the financial clerk with a bill of large denomination, and, instead of tendering the exact sum which was due, entrusted him with the bill, allowing him to make change, and upon his failure to return the change should attempt to hold the Government liable for the difference. No doubt there were a number of these attorneys who deposited their money without much consideration. They find themselves now indebted in small sums of money to the Office, and they naturally insist that they were dealing with the Government, and that the Government ought to indemnify them for their loss. These claims have certainly strong equitable features. The practice grew up out of the order of Commissioner Spear, the money deposited by the attorneys was always made payable to the Commissioner of Patents, and all the correspondence, receipts, etc., were conducted in the name of the Commissioner. In my judgment, Congress should authorize the Commissioner of Patents to adjust these claims, subject to the approval of the Secretary of the Interior, and to pay them by the recognition of orders for copies, records, assignments, etc. This would restore the parties to all their rights without the payment of any cash by simply supplying these attorneys with what it was originally contemplated they should receive. The amount involved is about five thousand dollars.

7. Delay in prosecuting applications

I desire to call especial attention to the subject of the delays which occur in the Patent Office on the part of applicants in the prosecution of their applications for patents.

Section 4894 provides --
 

All applications for patents shall be completed and prepared for examination within two years after the filing of the application, and in default thereof, or upon failure of the applicant to prosecute the same within two years after any action therein, of which notice shall have been given to the applicant, they shall be regarded as abandoned by the parties thereto, unless it be shown to the satisfaction of the Commissioner of Patents that such delay was unavoidable.

Under this section applicants who desire to prolong their applications and postpone action therein have an ample opportunity to do so. There are two classes of persons who apply for patents -- one composed of those who are exceedingly anxious to obtain their patents at the earliest practicable moment, the other, of those who desire to prolong the issue of their patents to keep the applications pending in the Patent Office to the very latest date possible. The second class embraces the more powerful, rich, and influential parties, who are either the inventors or the assignees of the inventors. This section of the statute enables the second class of persons to keep their applications pending in the Office for years before their patents issue. In the meantime they are engaged in the manufacturing and putting upon the market the article or improvement, but warning the public that the patent is applied for, the effect of which is to give them the absolute control and monopoly of the invention and to deter all other inventors from entering upon the same field of invention and from manufacturing the article. The manner in which this delay is effected may be briefly explained: The applicant files his application and is allowed two years within which to complete or perfect it. Any action of the Office requiring change or modification or some formal correction can be followed under this section by a further delay of two years before the applicant is required to take any action in response. At the expiration of the two years he perhaps makes some amendment or change in the character of his claims. This involves a corresponding action on the part of the Office, and, however prompt and speedy this action may be,the applicant is permitted another two years before any responsive action can be compelled from him. And so the matter may be continued. There are applications now in the Office which have been kept alive nine or ten years, and the Office is powerless to compel speedier or earlier action on the part of the applicants.

These repeated actions and these long-continued delays cannot fail to suggest that a great deal of useless and unnecessary labor and consumption of time in the Patent Office are involved. Every application stands in its proper place upon the calendar of the Office, and when reached in its order it must be examined carefully to see whether any action has been had since the last-recorded action of the Office, so that a case which has remained for two years without responsive action from the applicant may probably be examined twenty or thirty times simply to ascertain that nothing has been done. When it is considered that this labor is multiplied by the number of applications which are thus delayed the amount of useless and unnecessary labor expended can be appreciated.

While calling attention to the fact that this two years' period in the case of original applications is too long, it will be a matter of surprise to know that in applications for reissues Congress has omitted to fix any period (except the duration of the original patent) within which they become abandoned for want of prosecution. A reissue application is always alive, and the applicant may file an amendment ten years after it was required by the office to be made and be entitled to have it considered and acted on.

I earnestly recommend that section 4894 be so modified that there shall be vested in the Commissioner of Patents a discretion to declare any application forfeited for want of prosecution whenever he shall be satisfied that such order should be entered. This power is possessed by all tribunals who have the control of litigation and matters of this character. Of course the exercise of this power should be guarded by proper restrictions, so that injury or wrong cannot be done, and no order of this kind should be made by the Commissioner until ample notice has been given to the applicant to show cause why his application should not be declared forfeited. The power to reinstate a case after it had been declared abandoned should and would be preserved under section 4894, whenever, in case of death, insanity, or other good and sufficient cause, it should be made to appear to the satisfaction of the Commissioner that the want of prosecution was unavoidable, and that the party was incapable of showing cause why the case should not be declared abandoned.

8. Renewal application where case was forfeited for non-payment of final fee.

Section 4885 provides that, after the Office has passed and allowed an application and nothing remains but the payment of the final fee to complete the issuance of a patent, if the fee be not paid within the period of six months the patent shall be withheld. I have already called attention the fact that very frequently the payment of this final fee is purposely omitted in order to permit the applicant to extend the period of his monopoly; but of course this is not always the case. The provision of section 4897, which enables a party who has failed to make such payment to file a renewed application within two years from the date of the allowance of the original application and obtains his patent, is a wise and just provision; but there is very much doubt and uncertainty as to the meaning of this section, in so far as it requires that "such second application must be made within two years after the allowance of the original application." It has been held by high authority that the effect of this provision is by construction to bar the invention as well as the application if the renewed application be not filed within two years. On the other hand, there is also high authority that such is not the effect, and that even if two years have elapsed after the allowance of the original application the new application may be made and may go to patent, notwithstanding the existence of the original application, its allowance, and its forfeiture for non-payment of the final fee. This section should be amended to remove this uncertainty. I am of the opinion that the limitation should be to the invention; and not only this, but that when an application for a patent has been allowed by the Office and the applicant has failed to pay the final fee within six months, and has also failed to renew the application within two years, the invention should be made public and become public property as of the date of the original allowance. I think this should be the result, from a proper consideration of the relations between the Government and the inventor. The inventor has conceived and presented a new invention. He comes into the Office for the purpose of donating that invention to the public after he shall have first enjoyed its exclusive use for the period provided by law. The Office has made a careful and thorough examination, has discharged all its part of the contract, and extended to the applicant the right to take out his patent upon paying the charges required. The public from this moment is entitled to its part of the consideration of the contract, and ought not to be deprived of it by the failure of the inventor to fulfill his. The inventor has become so far public as to be made known to the Patent Office. The law extends to the applicant the full period of two years within which to avail himself of all his rights and to enjoy his property. Failing in this, he ought not to have it in his power to conceal the invention as a lost art and to deprive the public of it. On the other hand, other inventors may invent the same thing and come into the Office, and by patenting the invention deprive the public of what they have already acquired right to by virtue of the allowance of the first application. In other words, when an invention has been made and disclosed to the Office, and the application has been passed to issue, that invention should be taken out of the field of patentability as to all future inventors, and ought not to be regarded as a concealed or abandoned invention. I therefore recommend the modification of the statute so as to provide that such second application must be filed within two years after the allowance of the original application, and if not so filed, the invention shall be regarded as abandoned to and as the property of the public.

9. Joint inventors.

Under the present statutes a patent may issue to a sole inventor or joint inventors, to an inventor and his assignee of a part interest, or to the assignee or assignees of the entire interest. Every patent issued to a sole inventor or to an inventor and his assignee of an undivided part, or to the assignees of the whole interest, is beyond challenge so far as an improper union of persons as patentees is concerned -- that is to say, the law authorizes the patent to issue to the inventor or to any person or persons to whom he desires that it shall issue, and this is the principle which underlies the statute authorizing the assignment, grant, or conveyance either of the original invention before patent has been granted or of the patent after it is issued; but while there is no express provision of law declaring that a patent issued to joint inventors is void, should it appear that they were not joint inventors, yet that is the well-settled law, as announced by the courts. The statute also requires that the assignees of the inventor shall be such by virtue of a written formal legal assignment; but in the case of a patent to joint inventors, when it turns out that by mistake or error of law one of them was not a joint inventor, but the sole inventor, the other does not become a patentee as an assignee under a formal legal assignment, although he does become one of the joint patentees with the full consent and wish of his co-patentee. Inasmuch as it is often one of the most perplexing and difficult questions coming before the Office or before the courts to determine whether an invention is actually a sole invention or a joint invention in which two or more persons contributed, there seems no reason why a patent which is thus issued to persons who supposed themselves to be joint inventors should be invalid. Under all other systems within my knowledge the patent is allowed to issue in the name of those persons who demand it in whatever capacity or relation they may make the demand, and it is only requisite that one or more of the patentees shall have been the true inventor. I am aware of no reason why such should not be the law in the United States; and when there is taken into consideration the amount of time, labor, and trouble involved in investigating the question as to whether there was or was not an actual joint invention, and other incidental questions which are constantly arising, as well as the injustice to the patentees themselves of having their patents declared void, I find ample reason for recommending a provision of law expressly providing that the patents shall not be held to be invalid by reason of the fact that the inventors described as joint inventors were not joint inventors, provided that either one of them thus described was in fact the true and sole inventor.

10. Examination of applications

There is no occasion to refer at any length to the distinctions between the English patent system and the American. The principal and important difference consist in the examination given to an application filed in this Office to ascertain the novelty and utility of the alleged invention, the object being to secure to the inventor for a limited period the precise subject-matter -- no more and no less -- of his invention, and also to protect the public against fraud and imposition which may be practiced in imposing upon them worthless and invalid patents, and in securing them against vexatious and oppressive litigation founded upon that class of patents. A patent issued under the American system gives to the inventor and the public an assurance as to its validity which cannot be secured under any other system. In the courts the patent constitutes the highest prima facie evidence. The Patent Office contains a vast collection of information on the state of the art which is inaccessible and unattainable elsewhere. Resort musts be had to this establishment whether the examination be had before or after the patent is granted. The applicant secures this examination and the issuance of his patent for $35. It is not required that he shall be represented by attorney, though in all complicated inventions, and especially valuable ones, prudence would suggest such representation.

Under the British system the English Patent Office is little more than a registration office. The patent when issued is but a certification, and is of no value as property. No one would invest in it until it should be submitted to learned and skilled experts, who, outside of the office, bear the same relation to the merits of inventions as the examiners of this Bureau system. Such examinations and opinions based upon them by English lawyers are far less safe and reliable and much more expensive to the inventor than the procedure in the United States Patent Office. When it is called to mind how easily associations and corporations can be formed to promote the introduction of patent property and to foist the same upon the public, and how easily legal opinions can be secured urging and supporting the validity of the patents involved in the scheme, the danger and disadvantages of the system become apparent, so that it is beneficial neither to the inventor nor to the public. The disadvantages are not so great to a compact people occupying a limited territory like England as to our own people. A patent granted in this country without examination would be practically valueless to the inventor. He could never introduce his invention or place it on the market. The opinion of eminent counsel at Washington would not be accepted in Chicago; that of New York attorneys would not avail in San Francisco. The inventor would need a fortune to begin with in order to secure the opinions or "examination" of counsel known and recognized in every district and locality before he could succeed in availing himself of the value of his patent. However, it is believed the system is too well established and too thoroughly understood and appreciated to be shaken by any objections that can be urged against it.

It may not be out of place to call attention to the practice in the Office relating to the subject of these examinations, for there appears to exist no little mis-apprehension relative to it. An impression prevails that the questions of utility and novelty of an invention are passed upon and finally determined by the various assistant examiners who make the preliminary search and examination. This is erroneous. There are 30 examining divisions in the Office, to each of which are assigned certain classes of invention and art. Each division is presided over by a Principal Examiner, selected and retained in view of his long experience and supposed capacity. Under him are a certain number of assistant examiners, to whom he distributes the applications assigned to the division under his charge. These assistants make the examination and report the result to the chief. All actions affecting an application, whether of rejections, allowance, or the requirement for amendments, are submitted to the Principal Examiner for his supervision and approval, and whatever action is had is that of the head of the division. If he allows the application, it goes to patent. From his requirement for amendment, or other action relating to the form of the application, an appeal lies to the Commissioner in person, without fee. If he [the examiner KWD] rejects the application, an appeal lies to the Board of Examiners-in-Chief -- a board composed of three experienced persons -- and they review the rejection. Should they affirm the decision of the examiner, an appeal lies to the Commissioner, and thence to the Supreme Court of the District of Columbia. Cases are argued in full before these appellate tribunals, whose action is not in any sense perfunctory. The records will show reversals by the appellate tribunals in the Office to occur with greater relative frequency than in the courts of law and equity.

It must be confessed that great power is lodged in the hands of the Principal Examiner. If he allows the patent, it issues without further question. It is certainly true, however, that the inventor, as a general rule, secures the benefit of this exercise of power. As already stated, ample provision is made for appeal if the rejected applicant feels aggrieved and believes his application has merits; but the unlimited power of the examiner is in the direction of allowing patents. If there should be any restriction, it should be in guarding against its improper or irregular use. This might be done by organizing a board of review, to revise and inspect the allowed applications, with the view of preventing the issuance of improper patents.

11. Compensation of Examiners

There is no doubt that the compensation allowed the corps of examiners is insufficient. Promotions are not rapid, and there is little temptation for examiners to remain in the service after mastering the practice and business of the Office. With this acquisition a bright active man can at once secure business or employment elsewhere which is much more remunerative. The members of the examining corps who have secured promotion, as a general rule, are men of education and high attainments, especially in the requisite knowledge of the sciences and the arts. In my judgment, the public interest, as well as justice to this class of employees, would be well subserved by increasing their salaries, so that they shall be commensurate with the character of their services and the responsibilities of the duties. Such an increase would tend to secure and retain men possessing high qualifications.

12. Interference proceedings

There is some reasonable ground for complaint against the present system of interferences as it exists and is conducted under the Statues and Rules of Practice of the Patent Office. An interference necessarily occasions delay, for such a proceeding is not instituted until the question of patentability has been favorably determined. In the Patent Office, just as in the courts, poor and uninfluential suitors are frequently confronted by the powerful and rich. There are the same opportunities for procuring false evidence, corruption, and exercising other evil influences which exist in other departments and in the courts. Such conditions can hardly be said to be defects, however, in the American patent system. All that can be said is that there are 30 organized divisions in the Office composed of a body of assistant examiners and clerks presided over by a principal, and consequently in the examination, allowance, and rejection of applications, or in the declaration of interferences, there are more persons who may be approached and affected by such influences. But the requirement and necessity for the number of divisions depend upon our patent system. The vast number of applications that are presented and the labor and research involved in their examination make necessary the number. These conditions are essential, or else the system itself must be abandoned. Not only this, but so long as this system is retained there must exist as incidental to it some procedure of interference. When there are pending in the Office two applications for patents for the same invention, what must be done? The very purpose of an examination is to prevent two patents being granted for the same invention, or the issuance of a patent for that which is old in the arts. Not only this, but in the supposed case, if a patent issue to the applicant who first filed his application and is denied to the later one, absolute injustice may be done. The first may have pirated the invention from the other. So, also, if an applicant is confronted by a patent already issued, he may insist that he was the first original inventor, or that the patentee stole the invention. Without some reliable mode of determining the question the later applicant would be remediless. If a remedy were to be provided which would enable him to go into courts of equity and file a bill against the patentee, vacate the patent, and then renew his rejected application and obtain a patent, this would impose hardships as great as, if not greater than, those now endured. The rejected applicant might have to prosecute his bill in equity in Maine or California -- the defendant's home -- while, himself a poor man, he might have to contest with powerful corporations. In the meantime the invention is made public and an opportunity afforded for the patentee, as well as others, to make a case, and the chances for fraudulent evidence, antedating his invention, and defeating him, would be greatly increased.

In every interference there are necessarily two or more persons, each claiming to be the original inventor. Their claims may be false or fraudulent, but each is entitled to the same treatment and consideration until the facts are established. Each is in the sense of the law an "inventor," and entitled to equal consideration, even though one of them may have secured the aid of a corporation or powerful assignee. Precisely the same conditions would arise if the contests were in the courts. It is doubtful if any system can be devised that would be more friendly and beneficial to poor inventors than the present. The truth is, the present system of declaring and conducting interferences, with all the objections to it and defects in it, not the creation of any one mind, but it has been evolved from years of actual and practical experience. It is always the case in such matters that it is much easier to criticise and point out defects, selecting the rare and exceptional cases where the system has miscarried, and ignoring the infinite multitude of cases where it has succeeded, than to present a remedy or propose a better system.

It has been suggested by some who are eminent for their familiarity with procedure in the Office that instead of retaining the present interference system, which proceeds, as far as possible, according to contested proceedings in the courts, upon pleadings and evidence, subject to cross examination, the ex parte procedure of the Patent Office be extended to this subject; that each applicant be required when he files his application to deposit with it his preliminary statement, under seal, not to be opened or inspected unless his application shall be put in interference; the form of the preliminary statement to be prescribed by the Office calling for a full and exact account of the applicant's conception of the invention, disclosure to others, names, places, dates, models, experiments, reduction to practice, etc. All such preliminary statements should be lodged with a single officer and kept unopened in the secret archives until called for in consequence of the declaration of an interference. Such proceedings when declared would go, as now, to be tried and determined by the Examiner of Interferences upon the preliminary statements filed by the parties, no preliminary statement to be amended except when the issue of the interference was so framed that the original statement was insufficient or not specific, when amended, to be so amended by answers in answer to interrogatories propounded by the Examiner of Interferences and not otherwise. The decision of the Examiner of Interferences would be made without any hearing of parties, but reserving to them the right of appeal to the Board of Examiners-in-Chief and the Commissioner, and of full argument and hearing, and also reserving to the defeated party the right within a reasonable time to file a bill in equity in such United States court as might be indicated, to establish that he was the first, true, and original inventor, annul the patent issued by the Patent Office, and secure a decree adjudging him entitled to the patent. This suggestion is submitted, not recommended, as coming from persons of great experience. But here evidently while some of the defects of the present system might be obviated, it would compel the serious contests to be carried in the courts and subject the inventor to all the expenses, annoyance, vexatious delays, and anxieties that attend litigations in the courts.

13. Trade Marks and interstate commerce

After the decision of the Supreme Court of the United States in the Trade Mark cases, (100 U.S. 82,) which held that the acts of Congress approved July 8, 1870, and August 14, 1876, were unconstitutional, and that Congress had no power to legislate upon the subject of Trade Marks per se, the act of March 3, 1881, was enacted under the provisions of the Constitution conferring upon Congress the power to regulate commerce. That power, it is conceded, extends to commerce with foreign nations, commerce with the Indian tribes, and interstate commerce; but for some cause not apparent in the enactment approved March 3, 1881, Congress saw proper to authorize the registration of only such trademarks as were used in commerce with foreign nations or with Indian tribes and left trademarks which might be used in commerce between the States wholly unprovided for. If there should be any reason why the latter class of trademarks should be excluded from the protection of Federal legislation, or left to the regulations prescribed by the States, or wholly omitted, it is not apparent. The attention of Congress has been called to this subject by my predecessors, and I respectfully renew the suggestion that the provisions of that act be enlarged so as to cover trademarks used in interstate commerce. This question has become more important in view of the Union hereinbefore referred to for the protection of industrial property. Some additional legislation by Congress is necessary in view of the new situation resulting from this treaty. Article 6 of the convention declares that "every trade or commercial mark deposited in the country of origin shall be admitted to deposit and so protected in all other countries of the Union." It is evident from this declaration that if the article were to be fully carried out in this country it would probably admit to registration trademarks which otherwise would not be admissible under the existing laws of Congress. In other words, the provision is more liberal than the act of March 3, 1881. It is more liberal than was the common law, because under each there were limitations which excluded trademarks which were not regarded as lawful in some sense, and which were calculated to mislead, or were regarded as in contravention of religious ideas, morals, etc. The definition of a trademark is substantially the same in all commercial countries; but practice varies in the application of these definitions and in respect to the character of marks which may be protected. For instance, the usage in southern Europe in respect to the employment of sacred names in relations which would be offensive and perhaps sacrilegious to much of the American sentiment. In a case where a representation of the Virgin Mary was claimed for soap this Office held that its use in such a connection was offensive to a great proportion of the people of the United States; and therefore that it was not entitled to protection; yet it is actually protected in France, where a different sentiment prevails. Instances of this kind are rare; but the statute should be framed to cover all cases likely to arise. If Congress, therefore, is inclined to make the law of trademarks conform to the provision of the Convention, the act of March 3, 1881, should be amended so as to admit to registration any trademark already lawfully registered in any of the countries of the International Union, subject, of course, to the conditions which require preliminary examination as to prior use and employment in the class of commerce over which the legislation of Congress extend.

Another question in connection with trademarks which will suggest appropriate legislation relates to the coercive features of the provisions of the treaty intended to give trademark property a protection which would be unknown to the common law or to the statutes of this country. These provisions will be found in articles 9 and 10 of the Convention, and may be briefly stated to include seizure upon importation of any article of merchandise bearing an illicit trademark or a false or fraudulent intimation of origin. Of course, it is to be understood that the practical operation of such legislation would apply in this country to goods imported from abroad, and would authorize the seizure in this country of such goods. The act of August 14, 1876, provided for the seizure by United States marshals of all appliances used for counterfeiting or the fraudulent imitation of registered trademarks. Section 2496 of the Revised Statutes, as amended March 3, 1883, refuses entry at the custom-house of foreign goods bearing simulations of the trademarks of domestic manufactures. These two acts contain all the protection afforded by the United States statutes to our citizens so far as coercive measures are concerned. Of course the common law and the statutes afford a civil remedy for infringement; but in view of the fact, that as between the owner of a trademark in one country and the infringer of it in another, the civil remedy is so expensive, it practically constitutes no protection. Every country seems to have felt the necessity of employing coercive measures to prevent fraud of this character. No act of Congress has ever contemplated the seizure of merchandise bearing counterfeit of simulated trademarks, and under the present laws the courts of Federal jurisdiction have no jurisdiction to enforce such seizures. Whether such legislation should be made is submitted to the consideration of Congress.

Under Article 6 of the Constitution of the United States this Convention is now a part of the supreme law of the land. The Government may withdraw from it when inclined to do so; but until such withdrawal its provisions must be recognized, and ought to be enforced by appropriate legislation empowering the proper officers to make the required seizures, and determining the due proceedings in our courts which are necessary to enforce the provisions of the treaty and protect the rights of individuals. It is true that under the general provisions of this treaty, as set forth in Article 2, there is only contemplated giving to the citizens and subjects of foreign States the same protection that our own citizens enjoy; but it is to be apprehended that while it is not expected the same procedure and method will be employed, yet the same ample protection will be afforded to citizens of foreign countries which would be demanded for our own citizens.

14. Restriction of some of the evils of the patent system.

The growth and development of the patent system of the United States, and of inventive genius stimulated by the rewards and prospects of rewards growing out of that system, are the subjects of constant comment and public consideration. That this system has been useful and beneficial is beyond question; but it is impossible it should not be accompanied by greater or lesser evils. The attention of the public has been for years constantly called to the fact that the inventor himself rarely secures the real reward of his invention. This undoubtedly proceeds from the fact that quite as much genius is required to develop a property or manufacture and place it advantageously upon the market in so great a country as this, and to make it remunerative, as is required to make the invention, and it is the misfortune of inventors, as a general rule, not to be possessed of business habits and business faculties. The result has been that nearly all the great and most useful inventions of modern times have fallen into the hands of men of capital or corporations, who alone have the means of capital or corporations, who alone have the means to bring them before the public, develop their useful qualities, and enable the people directly to see that they are useful and be produced at prices which remunerate. This condition of things cannot be remedied, and perhaps ought not to be. There should be no legislation which interferes with the right of property which is vested in the inventor from the moment he has created a new subject of invention. The entire system and theory of patent property rest upon the idea that that which a man invents in the sense of its being a new and novel creation is his individual property, which he owns by the right of creation and discovery. It is not the theory of the patent law that when the Government grants a patent to an inventor it confers upon him any such property as it does in the case of a patent for land, which belonging to the Government at one moment becomes the property of the patentee upon the execution of the instrument; but the patent in the former case recognizes the existence of the property in the individual, but in consequence of its intangible and incorporeal nature it is incapable of protection from invasion by some other persons, unless some distinct and specific remedy is afforded the inventor against such invasion and infringement. Letters Patent are mere evidence of the fact that, in the opinion of the Government, the patentee has invented a new, useful, and original invention, and the Government undertakes to protect him in the exclusive enjoyment of that property for a definite term. Now, any legislation which departs from this theory and proceeds upon the idea that the patentee should not be entitled to full protection is a mistake. Many suggestions have been made as to the best method of protecting the inventor and enabling him to realize, as far as possible, the value of his invention, at the same time protecting the public against vast and powerful and corporations in patent property exacting greater values than can be justified upon any fair or reasonable consideration, and which by buying in all the succeeding improvements in a certain line of invention are enabled for generations to perpetuate a monopoly which erects and locates itself all over the country in every business center under the provisions of a patent is able in nearly all cases to prolong its life after the patent expires by reason of the possession which it has taken of the market. New manufacturers are unable for years after the expiration of the patent to come into the market and compete with an organization which thus has such complete possession of the field of the manufacture.

It has been recommended that some legislation should be had looking toward the restriction of the extension of patents and patented property. In this direction I suggest for the consideration of Congress the propriety of providing that all patents hereafter issuing shall contain a condition that they may be extinguished by the Government at any time upon the payment of the owners of the property, whether the patentee or his assigns, a reasonable sum of money, such sum to be determined by arbitration or otherwise, as may seem appropriate to Congress. It is probably safe and accurate to say that patent property as a rule is not so valuable as is popularly estimated. The profits which are enjoyed by the owners of property of this character are rather the result of having control of the market and being everywhere firmly established in the business of manufacturing the patented article. It is well known that the licensees under patents make enormous profits in the manufacture of such articles as the barb-wire, after having paid the royalty to the patentee, and it is probably true of all the great concerns engaged in manufacturing patented articles that they would still be able to conduct a large and profitable business were the patent to be extinguished. In view of the fact, already suggested, that in rare instances only do the original patentees obtain any adequate remuneration for their inventions, it seems entirely proper that the Government at any time should have the power in its discretion to extinguish the patent by paying such sum as would be a reasonable consideration for the appropriation of private property for public purposes. Of course, but few inventions would be extinguished in this way, as their importance generally is not such as to justify interference by the Government.

15. Abridgement of patents.

I desire to call the attention of Congress to the necessity of making provision for the compilation and publication of a classified abridgement of patents. The necessity for this publication has been earnestly set forth in the Annual Reports of this Office since 1848, when Mr. Commissioner Ewbank first called the attention of Congress to the subject. I hereto append extracts from these reports for a full understanding of the matter. Year by year the need and demand for such a work are more and more forcibly felt. Each field of invention broadens, and the necessary examination to determine the utility, novelty and usefulness of the invention presented becomes more intricate and difficult. No better illustration need be cited to show that such an abridgement is almost indispensable than the publication of patents relating to electricity. Copies of all patents on this subject from the year 1790 to July, 1880, were compiled and bound for the Electrical Congress held at Paris in 1880. This publication has since been continued. It is doubtful whether the work of the Office could keep pace with the vast number of applications which have been filed since the impetus given to inventive genius by the electric light and telephone were it not for these volumes, whereby examinations are facilitated and accuracy secured. In 1881 Congress appropriated $10,000 to begin this work. Fourteen thousand patents relating to agricultural implements were abridged and the briefs made ready for publication. The appropriation, however, was not continued, and the material was boxed and stored away. An appropriation of not less than $20,000 will be required to continue the work of abridging patents and to publish the material already prepared. The ready sale to manufacturers and inventors of such an abridgement would speedily reimburse the Government for the moneys expended in compiling and publishing such a work, and it is believed that the revenues resulting from such sales would largely increase the receipts of the Office.

16. Exchange of publications.

Some provision should be made by Congress by which this Office can be furnished, for publication in the Official Gazette, with certified copies of all decrees, decisions, and judgments made by the Federal courts in patent cases. I recommend that authority be conferred upon the Commissioner of Patents to furnish the Official Gazette to the clerk of any Federal court, or to the library belonging to the court, in exchange for the decisions rendered by such Federal court.

I further recommend that the Commissioner be vested with authority to exchange the Official Gazette for any publication of a scientific or useful character published in this or any foreign country, which, in his judgment, would be desirable and valuable to the scientific library of the Patent Office.

17. Charge for certified copies

I recommend that paragraph 12 of section 4934 of the Revised Statutes be amended so as to read:
 

For certified copies of patents and other papers when written copies are required, 10 cents per 100 words; but when certified printed copies of patents are required, 25 cents for the printed copy and 25 cents for the certificate thereof.

The Office now sells a printed copy of a patent at the rate of 25 cents for one copy and 10 cents each, if twenty or more are purchased at one time. There does not appear any reason why the addition of a certification should increase the expense to the patrons of the Office, except so far as the cost of the certificate increased it.

Business of the Patent Office

Detailed statement of all moneys received for patents, for copies of records or drawings, or from any source whatever. [fn.: A large number of copies of patents are furnished to co-ordinate branches of the Government for which no charge is made. The receipts would be considerably increased if the Office received payment for these copies.]
 

Applications 

    Cash received                       $962,026.13

    Cash refunded                          5,068.80

                                       ____________

    Net cash                             956,957.33

    Certificates of deposit               44,239.00

                                       ____________

        Total cash and certificates    1,001,196.33

                                       ============



Copies

    Cash received                         81,142.62

    Cash refunded                          2,190.18

                                          _________

    Net cash                              78,952.44

    Certificates of deposit                  366.40

                                          _________

        Total cash and certificates       79,318.84

                                          =========



Recording assignments

    Cash received                         20,729.28

    Cash refunded                          1,518.06

                                          _________

    Net cash                              19,211.22

    Certificates of deposit                  271.00

                                          _________

        Total cash and certificates       19,482.22

                                          =========



Subscription to Official Gazette

    Cash received                         15,577.23

    Cash refunded                             96.72

                                          _________

    Net cash                              15,480.51

    Certificates of deposit                  153.70

                                          _________

        Total cash and certificates       15,634.21

                                          =========



Registration of labels

    Cash received                          4,392.00

    Cash refunded                          1,591.50

                                           ________

    Net cash                               2,800.50

    Certificates of deposit                   84.00

                                           ________

        Total cash and certificates        2,884.50

                                           ========



                   Aggregates



Cash received                         $1,083,867.26

Cash refunded                             10,465.26

                                       ____________

Net cash                               1,073,402.00

Certificates of deposit                   45,144.10

                                       ____________

    Total cash and certificates        1,118,516.10

                                       ============



                   Expenditures



Amount expended by this Office under the several appropriations 

from January 1, 1888, to December 31, 1888



Salaries                                              $635,309.28

Official Gazette                                        42,271.30

Photolithographing                                      72,856.59

Scientific Library                                       2,336.53

Transportation of publications to foreign governments      380.80

                                                       __________

    Total                                              753,154.50

                                                       ==========

Approximate amount expended by the Department of the Interior on account of this Office from January 1, 1888, to December 31, 1888. [fn.: A literal compliance with the provisions of the statute requiring "a detailed statement of all expenditures for contingent and miscellaneous expenses" is not possible, for the reason that the contingent fund for the several bureaus of this Department was consolidated by the act of March 3, 1883, and hence no part of that fund is disbursed by the Patent Office, and I am furnished only with an approximate sum, expended on behalf of the Patent Office.]
 

Stationery                                              $8,872.44

Postage on foreign matter                                1,049.00

Printing and binding                                   185,921.21

Watch force                                             16,690.00

Furniture                                                2,239.84

Carpets                                                    510.69

Ice                                                        536.67

Telephones                                                 468.00

Washing towels                                             142.71

Sundries                                                 3,623.72

                                                       __________

    Total                                              219,954.28

                                                       ==========



    Aggregate amount of expenditures                   973,108.78

                                                       ==========



                   Receipts over Expenditures



Total receipts               $1,118,516.10

Total expenditures              973,108.78

                              ____________

Receipts over expenditures      145,407.32

                              ============



Statement of balance in the Treasury of the United States on 

account of the Patent Fund



Amount to the credit of the fund January 1, 1888    $3,257,490.91

Amount of receipts during the year 1888              1,118,516.10

                                                     ____________

    Total                                            4,376,007.01

Deduct expenditures for the year 1888                  973,108.78

                                                     ____________

    Balance January 1, 1889                          3,402,898.23

                                                     ============



Summary of the Business of the Patent Office

Number of applications for patent for inventions           31,713

Number of applications for patents for designs                971

Number of applications for reissues of patents                113

                                                           ______

    Total number of applications relating to patents       35,797

                                                           ______



Number of caveats filed                                     2,251

Number of applications for registration of trade marks      1,314

Number of applications for registration of labels             729

Number of disclaimers filed                                     8

Number of appeals on the merits                             1,252

                                                           ______

    Total                                                   5,554

                                                           ______

    Total number of applications 

        requiring investigation and action                 41,351

                                                           ======



Number of patents issued, including designs                20,420

Number of patents reissued                                     86

Number of trade marks registered                            1,059

Number of labels registered                                   327

                                                           ______

    Total                                                  21,892

                                                           ======



Number of patents expired during the year                  11,687

Number of patents withheld for non-payment of final fee     2,881





                    Patents Issued



States and Territories    Patents   One to 

                            and     Every

                          designs



Alabama                       64    19,726

Arizona Territory             10     4,044

Arkansas                      69    11,630

California                   445     1,943

Colorado                     153     1,270

Connecticut                  759       820

Dakota Territory              89     1,518

Delaware                      33     4,442

District of Columbia         214       830

Florida                       39     6,910

Georgia                      122    12,640

Idaho Territory               12     2,717

Illinois                   1,661     1,853

Indian Territory               5        --

Indiana                      494     4,004

Iowa                         368     4,414

Kansas                       330     3,018

Kentucky                     218     7,562

Louisiana                     98     9,591

Maine                        152     4,269

Maryland                     283     3,303

Massachusetts              1,887       914

Michigan                     693     2,362

Minnesota                    277     2,818

Mississippi                   48    23,574

Missouri                     647     3,351

Montana Territory             31     1,263

Nebraska                     137     3,302

Nevada                        17     3,662

New Hampshire                141     2,460

New Jersey                   863     1,310

New Mexico Territory          23     5,198

New York                   3,634     1,398

North Carolina                55    25,450

Ohio                       1,353     2,363

Oregon                        66     2,648

Pennsylvania               1,990     2,152

Rhode Island                 209     1,323

South Carolina                42    23,704

Tennessee                    131    11,773

Texas                        239     6,660

Utah Territory                21     6,855

Vermont                       89     3,733

Virginia                      97    15,593

Washington Territory          26     2,889

West Virginia                 62     9,975

Wisconsin                    461     2,853

Wyoming Territory              6     3,464

United States Army             9        --

United States Navy            12        --

    Total                 18,884





Patents issued to citizens of foreign countries



Austria-Hungary                30

Belgium                        20

Brazil                          1

Canada                        281

Canary Islands                  1

Central America                 3

China                           1

Colombia, United States of      2

Cuba                            5

Denmark                         8

England                       523

France                        131

Germany                       355

Hawaii                          2

Ireland                        12

Italy                           4

Mexico                          7

Netherlands                     4

Newfoundland                    1

New South Wales                 6

New Zealand                     5

Norway                          6

Queensland                      1

Russia                         18

Scotland                       33

South Australia                 4

Spain                           2

Sweden                         13

Switzerland                    44

Turkey                          1

Victoria                       11

Wales                           1

    Total                   1,536



Comparative statement of the business of the Office form 1837 to 

1888, inclusive



Years Applica- Caveats Patents   Cash        Cash        Surplus

       tions    Filed  and      Received    Expended

                       Reissues



1837                    435   $29,289.08   $33,506.98

1838                    520    42,123.54    37,402.10   $4,721.44

1839                    425    37,260.00    34,543.51    2,716.49

1840     765    228     473    38,056.51    39,020.67

1841     847    312     495    40,413.01    52,666.87

1842     761    391     517    36,505.68    31,241.48    5,264.20

1843     819    315     531    35,315.81    30,766.96    4,538.85

1844   1,045    380     502    42,509.26    36,244.73    6,264.53

1845   1,246    452     502    51,076.14    39,395.65   11,680.49

1846   1,272    448     619    50,264.16    46,158.71    4,105.45

1847   1,531    553     572    63,111.19    41,878.35   21,232.84

1848   1,628    607     660    67,576.69    58,905.84    8,670.85

1849   1,955    595   1,070    80,752.78    77,716.44    3,036.54

1850   2,193    602     995    86,927.05    80,100.95    6,816.10

1851   2,258    760     869    95,738.61    86,916.93    8,821.68

1852   2,639    996   1,020   112,656.34    95,916.91   16,739.43

1853   2,673    901     958   121,527.45   132,869.83

1854   3,324    868   1,902   163,789.84   167,146.32

1855   4,435    906   2,024   216,459.35   179,540.33   36,919.02

1856   4,960  1,024   2,502   192,588.02   199,931.02

1857   4,771  1,010   2,910   196,132.01   211,582.09

1858   5,364    943   3,710   203,716.16   193,193.74   10,592.42

1859   6,225  1,097   4,538   245,942.15   210,278.41   35,663.74

1860   7,653  1,084   4,819   256,352.59   252.820.80    3,531.79

1861   4,643    700   3,340   137,354.44   221,491.91

1862   5,038    824   3,521   215,754.99   182,810.39   32,944.60

1863   6,014    787   4,170   195,593.29   189,414.14    6,179.15

1864   6,972  1,063   5,020   240,919.98   229,868.00   11,051.98

1865  10,664  1,937   6,616   348,791.84   274,199.34   74,593.50

1866  15,269  2,723   9,450   495,665.38   361,724.28  133,941.10

1867  21,276  3,597  13,015   646,581.92   639,263.32    7,318.60

1868  20,420  3,705  13,378   684,565.86   628,679.77   52,866.09

1869  19,271  3,624  13,986   693,145.81   486,430.78  206,715.03

1870  19,171  3,273  13,321   669,476.76   557,149.19  112,307.57

1871  19,472  3,624  13,033   678,716.46   560.595.08  118,121.38

1872  18,246  3,090  13,590   699,726.39   665,591.36   34,135.03

1873  20,414  3,248  12,864   703,191.77   691.178.98   12,012.79

1874  21,602  3,181  13,599   738,278.17   679,288.41   58,989.76

1875  21,638  3,094  16,288   743,453.36   721,657.71   21,795.65

1876  21,425  2,697  17,026   757,987.65   652,542.60  105,445.05

1877  20,308  2,869  13,619   732,342.85   613,152.62  119,190.23

1878  20,260  2,755  12,935   725,375.55   593,082.89  132,292.66

1879  20,059  2,620  12,725   703,931.47   529,638.97  174,292.50

1880  23,012  2,490  13,947   749,685.32   538,865.17  210,820.15

1881  26,059  2,406  16,584   853,665.89   605,173.28  238,492.61

1882  31,522  2,553  19,267 1,009,219.45   683,867.67  325,351.78

1833  34,576  2,741  22,383 1,146,240.00   675,234.86  471,005.14

1884  35,600  2,582  20,413 1,075,798.80   970,579.76  105,219.04

1885  35,717  2,552  24,233 1,188,098.15 1,024,378.85  163,710.30

1886  35,968  2,513  22,508 1,154,551.40   992,503.40  162,047.95

1887  35,613  2,622  21,477 1,144,509.60   994,472.22  150,037.38

1888  35,797  2,251  20,420 1,118,576.10   973,108.78  148,407.32

Statement showing the number of the first patent, design patent and reissued patent, and the number of the first certificate of registration of a trade mark and a label issued in each calendar year since July 28, 1836, when the present series of numbers of letters patent commenced, together with the total number of each issued during the year. The number of patents granted prior to the commencement of this series of numbering (July 28, 1836) was 9,957. [Divided for convenience of typing into two tables KWD]
 

     Number of first patent and certificate issued 

                 in each calendar year



Year         Patents  Designs  Reissues  Trade   Labels

                                         Marks



1836 July 28       1

1837             110

1838             546                 1

1839           1,061                 7

1840           1,465                20

1841           1,923                30

1842           2,413                36

1843           2,901        1       49

1844           3,395       15       60

1845           3,872       27       67

1846           4,348       44       78

1847           4,914      103       91

1848           5,409      163      105

1849           5,992      209      128

1850           6,981      258      158

1851           7,865      341      184

1852           8,622      431      209

1853           9,512      540      229

1854          10,358      626      258

1855          12,117      683      286

1856          14,008      753      337

1857          16,324      860      420

1858          19,010      973      517

1859          22,477    1,075      643

1860          26,642    1,183      874

1861          31,005    1,366    1,106

1862          34,045    1,508    1,253

1863          37,266    1,703    1,369

1864          41,047    1,879    1,596

1865          45,685    2,018    1,844

1866          51,784    2,239    2,140

1867          60,658    2,533    2,430

1868          72,959    2,858    2,830

1869          85,503    3,304    3,250

1870          98,460    3,810    3,784       1

1871         110,617    4,547    4,223     122

1872         122,304    5,442    4,687     608

1873         134,504    6,336    5,216   1,099

1874         146,120    7,083    5,717   1,591       1

1875         158,350    7,969    6,299   2,150     233

1876         171,671    8,884    6,831   3,288     465

1877         185,813    9,686    7,452   4,247     937

1878         198,733   10,385   *8,920   5,463   1,329

                                *sic, actually 8,020

1879         211,078   10,975    8,529   6,918   1,821

1880         223,211   11,567    9,017   7,790   2,176

1881         236,137   12,082    9,523   8,139   2,379

1882         251,137   12,647    9,994   8,973   2,581

1883         269,820   13,508   10,265   9,920   2,885

1884         291,016   14,528   10,432  10,882   3,791

1885         310,163   15,678   10,548  11,843   4,304

1886         333,494   16,451   10,677  12,910   4,695

1887         355,291   17,046   10,793  13,939   5,073

1888         375,720   17,995   10,892  15,072   5,453

1889         395,305   18,830   10,978  16,131   5,780





   Number of patents and certificates of registration 

          issued during each calendar year



Year       Patents  Designs  Reissues  Total Trade  Labels  Total

                                     Patents Marks         Certi-

                                                          ficates

1836 July 28   109

1837           436

1838           515             6

1839           404            13

1840           458            10

1841           490             6

1842           488            13

1843           494      14    11       510

1844           477      12     7       495

1845           476      17    11       504

1846           566      59    13       638

1847           495      60    14       569

1848           583      46    23       652

1849           989      49    30     1,068

1850           884      83    26       993

1851           757      90    25       872

1852           800     100    20     1,019

1853           846      86    29       961

1854         1,759      57    28     1,844

1855         1,891      70    51     2,012

1856         2,316     107    83     2,506

1857         2,686     113    97     2,896

1858         3,467     102   126     3,695

1859         4,165     108   231     4,504

1860         4,363     183   232     4,778

1861         3,040     142   147     3,329

1862         3,221     195   116     3,532

1863         3,781     176   227     4,184

1864         4,638     139   248     5,025

1865         6,099     221   296     6,616

1866         8,874     294   290     9,458

1867         12,301    325   400    13,026

1868         12,544    446   420    13,410

1869         12,957    596   534    13,997

1870         12,157    737   439    13,333     121            121

1871         11,687    905   464    13,056     486            486

1872         12,200    884   529    13,613     491            491

1873         11,616    747   501    12,864     492            492

1874         12,230    886   483    13,599     557     232    791

1875         13,291    915   631    14,837   1,138     232  1,370

1876         14,172    802   621    15,595     959     472  1,431

1877         12,920    699   568    14,187   1,216     392  1,608

1878         12,345    590   509    13,444   1,455     492  1,947

1879         12,133    592   488    13,213     872     355  1,227

1880         12,926    515   506    13,947     349     203    522

1881         15,548    565   471    16,584     836     202  1,038

1882         18,135    861   271    19,267     947     304  1,251

1883         21,196  1,020   167    22,383     902     906  1,808

1884         19,147  1,150   116    20,413   1,021     513  1,534

1885         23,331    773   129    24,233   1,067     391  1,458

1886         21,797    595   116    22,508   1,029     378  1,407

1887         20,429    949    99    21,477   1,133     380  1,513

1888         19,585    835    86    20,506   1,059     327  1,386

Herewith accompanying this report are lists or indexes, arranged in yearly form, of all patents granted during the calendar year 1888, properly classified under subjects of invention, and alphabetical lists of all patentees, with their places of residence. No patents were extended during the year.

Very respectfully, your obedient servant,

Benton J. Hall, Commissioner

 

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