Gass ~r^S7 Book / ' - ' DEBATES BEFORE PARLIAMENT RELATIVE TO THE ENACT- MENT OF A COMPULSORY WORKING CLAUSE INTO THE BRITISH PATENT STATUTES 931 fsAa WASHINGTON GOVERNMENT PRINTING OFFICE 1912 "^ C-AJ-^/J i' '\'^V V x'^^ Gathered by CLARENCE E. KAY, Ci.erk, AND Printed for the Use of the Committee on Patents of the U. S. House of Representatives April 22, 1912 6 W5 PATENTS AND DESIGNS BILL. [Commons, Mar. 19, 1907.] The president of the Board of Trade (Mr. Lloyd-George, Carnarvon Boroughs), in asking leave to bring in a bill to amend the law relating to patents an designs, said: ^^This bill introduces a good many im- provements which have been found necessary in the working of the patent laws in this country. The main object is to simplify and cheapen procedure. The bill will make provision for the grant of patents of addition, there will be additional checks against invalid patents, and a cheaper procedure for the revocation of patents. These will be introduced in the interest of the poor inventor, for, although it often suits a rich and powerful company to have compli- cated and expensive machinery, it very often involves ruin for a poor inventor. I propose, therefore, to introduce a series of conditions which, I hope, will effect a considerable cheapening of procedure. I do not know that we can ever make the patent laws cheap as long as the fees of counsel and experts are high, but something can be done in order to meet the difficulty. I also propose to introduce later on a consolidation bill, and if that bill goes through the grand committee on trade I think it will be possible to amalgamate it with the present bill. But the main object of this bill, after all, is to prevent the pat- ent laws from being used for the hindrance and suppression of British industrial development. The object of the patent laws is to reward ingenuity, and by so doing to encourage invention and to promote British industry. Unfortunately, however, they have been used in many respects to discourage the British inventor and to destroy many British industries. What is happening at the present moment ? Out of 14,700 patents issued last year, 6,500 are foreign! I do not object to that, but a good many of these patents have been taken out not for the purpose of working the patents in this country but for the purpose of preventing their being worked. That I consider to be an abuse of a privilege conceded* by British laws. There is a still worse abuse, on the whole I think it is the worst. The British inventor who takes out a patent is very often a poor man who has been able to get his patent financed up to a certain point. After he has started and set up works and purchased machinery there comes a poAverful for- eign syndicate which lias found tliere is something in liis patent which they imagine is covered by an invention they have already patented — for these patents are very often in exceedingly vague terms. This syndicate then brings to bear the whole machinery of their powerful organization to crush the inventor. He is brought before the court of first instance, and if he wins there he is taken to the court of appeal, and then dragged up to the House of Lords, by which time all the capital he has been able to raise for the purpose of working his patent 4 .PATENTS AND DESIGNS BILL. is expended in law costs, and the patent which ought to have been an encouragement to his ingenuity has simply become a trap for his ruin. That I consider to be a thoroughly flagrant abuse of the privileges conferred by British institutions upon foreigners on equal terms with Britons, and I think it ought to be put an end to. The mere fact that it has not been put an end to is in itself a proof of the long- suffering of the average Briton. An attempt was, I think, made by the late Government to deal with this problem. I am not criticising their method — for after all in these things we must proceed experi- mentally — when I say that the attempt was a failure, because of the very expensive character of patent litigation. Mr. Levinstein, who took a great interest in this question, brought an action under the act in order to expose the futility of the machinery. It cost him about £4,000, and that naturally discouraged further experiment in the same line. Therefore, there is very little use trusting to that act. It is much too expensive. The suitor has to go before the judicial com- mittee of the privy council, a very costly proceeding. It is clear, therefore, that some other means must be found for putting an end to the abuse. I propose to apply three or four methods. In the first place, I propose to simplify the procedure of compulsory license, and instead of the applicant having to go before the judicial committee of the privy council, as at present, he will go, first of all, before the controller and afterwards before a judge specially selected by the Lord Chancellor, who will be habitually dealing with patent cases. This method will tend very considerably to shorten the hearing of cases, because they will be dealt with by an expert judge. A second method is that any applicant can go to the controller three years after the granting of any patent and apply for the revocation of the patent on the ground that it has not been adequately worked within the United Kingdom. There is another point of great importance. Big foreign syndicates have one very effective way of destroying British industries. They first of all apply for patents on a very considerable scale. They suggest every possible combination — for instance, in chemicals — which human ingenuity can possibly think of. These combinations the syndicates have not tried themselves. They are not in operation, say, in Germany or elsewhere. But the syndicates put them in their patents in obscure and vague terms so as to cover any possible invention that may be discovered afterwards in this country. What happens ? A British inventor makes a bona fide dis- covery. He attempts to patent it. He probably secures a patent. But the moment he does so this powerful foreign syndicate brings an action against him for infringement of patent. They include possibly as many as 15 or 16 counts in their indictment ; they employ the ablest and consequently the most expensive counsel at the British bar and the best scientific experts. The result is that the poor British in- ventor, before there is time for his invention to take root or to become a success, is simply overwhelmed by this tremendous combination. In that way many British industries have been wiped out. There are two ways in which the bill proposes to meet that state of things. One is by compulsory working and the second by forcing powerful syn- dicates — home, of course, as well as foreign — to deposit samples, where the patent office demand them, or else their application will be refused. There is another way in which foreign patents work in restraint of British trade. Before a manufacturer, say, in the boot trade — a trade PATENTS AND DESIGNS BILL. 5 in which this grievance has been particuhirly felt — can use the patent he is obhgecl to sign a kind of lease for 20 years, during which period he is prohibited from using any other machinery. There may be a considerable improvement in machiner}^ (hscovered meanwhile by a British inventor or by some other foreign inventor, but the manufac- turer, under the concUtions of his lease, mil not be allowed to put the improved machinery into his works. It was thought that such con- , ditions, acting in restraint of trade, could be set aside; but according to the decision of Mr. Justice Wills the patentee has the right to impose any conditions, however unreasonable, he pleases. There are many people in this country working under these impossible conditions, which at any time may have the most serious consequences to the industries of tliis country. I propose that in future these conditions shall be nugatory. I have not time now to deal with the objection that this is a protective measure. I think it is in the interest of free trade. I am not afraid of foreign competition as long as British trade is free to fight it. I would free British trade from impossible condi- tions abroad and from equally stupid tariff systems at home. At the present moment many British industries are bound hand and foot by the working of the patent system. Many British industries have been completely wiped out by privileges conceded by British institutions to foreigners. I propose that these bonds shall be cut, and that the British industry shall be made perfectly free to engage on equal terms in the severe struggle with its competitors." Motion made and question proposed '^That leave be given to bring in a bill to amend the law relating to patents and designs" (Mr. Lloyd-George). Mr. BoNAR Law (Camberwell, Dulwich). I wish to- Mr. Speaker. Does the honorable gentleman rise to oppose ? Mr. BoNAR Law. No, sir. Mr. Speaker. Then the honorable gentleman can not speak under the 10-minutes rule. Question put, and agreed to. Bill ordered to be brought in by Mr. Lloyd-George and Mr. Kearle}^. PATENTS AND DESIGNS BILL. '^To amend the law relating to patents and designs," presented accordingly, and read the first time; to be read a second time upon Monday next, and to be printed. [Bill 121.] [Commons, April 17, 1907.] Order for second reading read. Mr. Bowles (Lambeth, Norwood) said that early that morning, about 12.15, the patronage secretary put down certain bills for dis- cussion for "to-morrow." Amongst those bills was the patents bill, which appeared in the orders of the day. What he desired to ask was whether when those bills were put down by order of the house for one day it was competent for the Government after the house had adjourned to secure their advance by one day. Mr. Speaker. I must take the responsibility for having made the alteration. The truth is that it escaped the patronage secretary 6 PATENTS AITD DESIGNS BILL. and myself that it was past midnight, and consequently ''to-morrow" became "to-day." I think the house generally understood that we should take this bill on Wednesday. Motion made, and question proposed, ''that the bill be now read a second time." \ Sir F. Cawley (Lancashire, Prestwich), in supporting the second reading, said the first patent, as far as he could discover, was granted in 1626 and recited that — Because much time and labor and money has been spent by Walter Drummond, and because the invention may be of use and advantage to the State, the King grants a monopoly, but should the said Walter Drummond fail to reduce to practice within three years his scheme of patent, the said patent shall then lapse. From that it was perfectly clear that the patent had not been granted to the inventor for his ingenuity alone, but also for his services to the State in introducing a new manufacture to the realm. It appeared to him that those conditions were just, and ought to govern our present practice, and that no patent should be granted without a patentee's being required to work his invention in this country. If, however, all countries did as we did, that was, grant a patent to anybody and everybody who applied there would be nothing to object to; but when all other countries took a different view he thought there was not much to be said for our present practice. In Germany, if a patent was not worked within three years, it could be revoked and declared void. In France, if a patent was not worked within two years it could be revoked. In fact, in practically every industrial country, including Japan, patentees had to work their patents, or to get them worked within a certain time of their being granted, or their grant might be revoked. We were the only country in Europe that allowed a patentee to take his grant away and work it where he liked or sell it to whom he liked. The result of this careless liberality was that foreigners came here and got patents granted them without ever having the slightest intention of working them in this country. They not only did this, but, aided by powerful associations and syndicates, particularly in Germany, they used these patents to filch our trade away, and in this, he was sorry to have to say, they had often been successful. In 1903 we had granted nearly 8,000 patents or monopolies to persons residing out- side this country; in fact, more than half the patents taken out here, and the mostimportant ones, had been taken out by foreigners. We granted a larger number of patents (about 5,000 more) than Germany did every year, although the population of Germany was one-third greater than our own. Some of these patents were only taken out for blocking purposes, and were unscrupulously used when our manufacturers wished to make any article which would compete with a German production. Others which were of importance were taken abroad and were used to start industries there by new and improved processes, and so superseded industries carried on in this country. Thus our manufacturers suffered great injury and our workpeople lost their employment. Although a patent lasted only 14 years, it was long enough to establish the industry abroad, and once established there, with trained labor, experience, and an organ- ized system of distribution, it was no easy matter to get it back again. What they said was that the granting of a patent, which PATENTS AND DESIGNS BILL. 7 was really a monopoly, was in the nature of protection, and that for every monopoly granted there should be a quid pro quo to the State granting it. We got no quid pro quo for the monopolies we gave, but we allowed tlie person to whom the monopoly was granted to produce his patented articles solely abroad; in other words, we ran contrary to the doctrine of free trade, not for our own benefit, but for the benefit of the foreigner. Most patents that were granted to Englishmen were ])robably worked in this country, but they had to remember that we had no monopoly of genius in this country, and that as the population of America and other European countries was 440,000,000 and that of the United Kingdom was only 40,000,000, we could not expect to produce the same number of inventions as they did, and when we considered also that they were advancing in their manufacturing capacity by leaps and bounds, it followed that the number of patents granted to foreigners would greatly increase, and that if the present state of affairs was allowed to continue we should not only lose our share of the new industries which were so rapidly springing up, but we stood a very great chance of losing the supremacy we still held in old ones. The great industrial progress of Germany had recently figured very largely in discussions on our fiscal system. That Germany had made enormous strides could not be denied, and in his opinion the advantages that she had enjoyed through our absurd leniency in regard to patents had been one great factor in the success which she had attained, in some degree, at our expense. The chemical industry of Germany had increased rapidly, and now amounted, with allied industries, to something like 70,000,000 per annum, and part of that trade had been taken away from this country. Was it not quite time there should be some close investi- gation to see the cause. When it was considered that the process of manufacturing aniline colors from coal tar was discovered in this country, that the industry was commenced and flourished in this country, that w^e were the greatest producers of the raw material from which the colors were made, that we had cheap fuel and a favor- able, geographical position, and that we were also the greatest con- sumers of the finished article, and that we had allowed this enormous trade to be taken away from us, it was, he thought, humiliating There were in Germany engaged in this manufacture five firms, who, employed something like 26,000 hands, and had an aggregate capital whose market value was something like £16,000,000 sterling. Most of the labor employed in these works was unskilled labor, and was the very kind of work which would absorb our unemployed if we only insisted that there should be a quid pro quo for the monopolies we granted and that they should not be taken away and used to find work for foreign labor in foreign countries at the expense of our fellow countrymen. It Avas a well-known fact that the foundation of the aniline color industry in Germany had been laid by the manufac- ture of alizarine, for which a number of patents for working it com- mercially had been obtained in this country, with the result that everyone was able to make and sell in that country, whilst in this coun- try it was a close monopoly, and our dyers were charged an enormous price for an article which could be just as well made by us as by Germans. The patent for this article has now lapsed, but the busi- ness had been so firmly established in Germany both by the scientific process of manufacturing and by the organizations for distribution 8 PATENTS AND DESIGNS BILL. that we had not been able to wrest the trade from them. But he would like to call the special attention of the house to the question of artificial indigo. We employed something like 200,000 people in India on the indigo plantations. The Germans had discovered an artificial indigo which, on account of its much lower price, was superseding the vegetable product. The capital employed would, he supposed, be lost, and German labor and German capital employed in its stead. In this case it would be seen that we were losing an industry which had found employment for thousands of our Indian fellow subjects, through granting the Germans a British patent or monopoly without imposing upon them any obligation to work it in this country. Had we said to them as they said to us: ^^If we grant you a patent or monopoly for the sale of this article, you must, in return, manufacture the article here," we would by now have had large works in this country giving employment to numbers of laborers. By our patent laws, as they were at present, we were benevolently fostering great industries in Germany, to the detriment of the manu- facturers, consumers, and working classes of this country. The sup- porters of this measure wanted no interference with free trade. All they asked was just and equitable treatment. They held that mo- nopolies should not be granted to foreigners to be used to handicap us in that competition which was every day becoming more acute. Honorable members opposite seemed to think that this was a ques- tion of protection. It was not a question of protection. We had been granting thousands of patents to foreigners and getting nothing in exchange. What was now proposed to be done was to say to the inventor: ''We are going to grant you a monopoly of the strictest kind possible, but if we do that the country at least ought to have some recompense for having done it." The patent ought not merely to be a prize to the inventor who applied for it. The country where the man was granted protection ought at least to have some share in the benefit. If a man obtained a patent in this country he ought to manufacture the goods here. He thought this bill would go some distance toward stopping foreigners from obtaining an advantage in our markets and giving nothing in exchange. Mr. Cave (Surrey, Kingston) said that when the second reading of the bill was moved many honorable members waited to see whether the senior member from Merthyr Tydvil would move the amendment of which he had given notice. Clause 10 of the bill, against which the amendment was obviously directed, appeared to most members of the house to do nothing but justice to British inventors. But honorable members opposite seemed to think that there might be found in it some trace of that fiscal reform or fair trade of which they were so much afraid. However, it seemed that the honorable member who had given notice of the amendment was not bold enough to move it, and he therefore proposed to put before the house some general criticisms of the measure. Under the new rules just passed the bill would probably be sent to a standing committee, so that he and many others might have no chance of criticizing the details. They must, therefbre, call attention to the defects of the bill on the second reading; He recognized that the intention of the bill was to improve the patent laws, and also that there were many clauses which would be of real use to inventors in this country. He did not intend to vote against the second reading. But he was a little bit PATENTS AND DESIGNS BILI^ 1) afraid that, in attomptin<^ to iinprovo the patent hiws and tlie posi- tion of the inventor, the bill might make that position worse in some respects than it was now. There were clauses in the hill which would cast on the inventor, and especially the inventor of moderates means, a heavy burden which he would not be very well able to bear. The eiFect of these clauses would be to discoura(]je the takin<]^ out of patents, and thus many small inventors would be d(!prived of th(^ benefits of their ingenuity. He instanced clause 2 with respect to the ''deposit of samples in the case of chemical inventions" as a serious matter. There were inventions in chemistry which related to intermediate processes and which could not be exemplified by samples ; and there were other inventions of which samples could not be provided without considerable expense. Unless great care was taken that clause would be found impossible to work. Having taken the opinion of others on the question, he did not think that particular provision was necessary, and he was inclined to say that on the whole it would be better not to have it in the bill. A matter of more importance was clause 6, ''grounds of opposition." It provided that the grant of a patent might be opposed on the ground — That the invention has been described or claimed in any complete specification for a British patent which is or will be of prior date to the patent the grant of which is opposed, or that the invention has been published in this country prior to the date which the patent would bear if granted, or on the ground that the nature of the inven- tion or the manner in which it is to be performed is not sufficiently or fairly dwscribed and ascertained in the complete specification. If this provision were passed, almost any application for a patent might be opposed, there being thousands of old specifications lumber- ing up the patent office which might be cited in opposition to new applications. He was afraid that the clause might lead to many useful patents meeting with serious and formidable opposition. That would cause very serious expense which many small inventors would not be able to bear. It would be found that an application for a patent, instead of being, as now, a simple and not very expensive matter, would become in many cases very expensive indeed, with the result that inventors would be discouraged from taking out patents. The same observation applied to clause 9 with reference to ''power of comptroller to revoke patents on certain grounds." They knew what the competition in trade was — the competition of large firms against small ones and of foreign against British firms. These firms would pay almost any sum in order to get rid of a patent which interfered with their operations. There would be a temptation to large firms to use clause 9 as an engine of oppression against men who could not a.Tord the cost of defending their inventions. If so, clauses 6 and 9 would throw on inventors a very serious burden indeed. He knew that was not intended, but he thought that would be their elect, and they ought therefore to be carefull}^ considered in committee. Another important point was as to the tribunal which was to have the decision of these matters. Under the bill, as it stood, questions as to the grant of patents, questions of revocation, and others, which involved a very careful considera- tion of facts and of law, and very often of scientific questions which could only be determined by a skilled judge or arbitrator, were to be decided by the comptroller. He had not a single 10 PATENTS AND DESIGNS BILL. word to say against the comptroller or against the way in which he exercised his functions at the present time, but he was an official with administrative duties. He had charge of a very important department in which he was certainly engaged in work mainly of an administrative character. He was appointed for that purpose, and no doubt he found the work heavy enough. Now it was proposed to throw on that official, who was not a judge, the duty of deciding the difficult and intricate questions which arose on appli- cations for and revocations of patents. Only recently there was an application for revocation of a patent which occupied seven or eight days in hearing before a learned judge. Similar cases would arise under the clauses of this bill, and was it really intended that cases of that kind should come before the comptroller, who, though a very competent official, could not properly undertake the work? He did not think that inventors and others interested would be satisfied wdth that proposal. There was to be an appeal to one judge, whose decision was to be final. He thought every case of importance would be appealed. There was no branch of the law where appeals were more frequent or so certain to occur as in patent cases. If in every important case there would be an appeal, why did not the Government take their courage in both hands and provide at once that those cases should come before a judge ? Half the ex- pense would be saved, a hearing would be had once for all, and a decision would be obtained satisfactory to the litigants. Another point was that it was not very satisfactory to have appeals taken from the comptroller to a law officer. He did not think it was right to give judicial powers to the law officers of the Crown; only a judge should exercise them. If a patent court, such as he had suggested, were set up those appeals from the comptroller's decision which now went to the law officers would also go direct to the court. Again, let them take the question of actions for infringements of patents. As many members knew, a person could bring an action for infringement and choose his court — usually the chancery division. But the result was that those patent cases which were foreign to the ordinary work of the chancery division came now before one judge and now before another; and although the cases were disposed of with great ability, still that was not the best way of securing consistent decisions. These cases also should go to a patent court for which there would then be ample work. There were also the interlocutory applications in patent cases, which also ought to go before the patent judge. He did not say that the patent court must necessarily be always presided over by the same judge, who might in that case get into a groove, but the judge might be appointed for a year, and another judge for another year. He hoped that the Government would consider, before the committee stage, the suggestions he had made and dis- cover a method by which they could be given effect to. It was true that clause 17 provided that all appeals from a decision of the comp- troller should be made to such judge of the high court as the lord chancellor might select for the purpose, and that the decision of that judge should be final. But that did not meet the matter at all, because that provision was confined to appeals under this bill and would not apply to the existing patent litigation which was very heavy indeed. The views which he had expressed were, he knew, PATENTS AND DESIGNS BILL. 11 held by many men of experience in the legal profession and by com- mercial men who had a real interest in the matter. Mr. Pickersgill (Rethnal Green, S. W.) said he desired briefly to call the attention of the president of the board of track^ to an aspect of the bill which seemed to him had been overlooked by the board. Clause 16 made void conchtions or contracts which extenchMl far beyond use of a patented article and would in many cases most seriously hamper the licensee in his trade. He was not sure that clause 16, as drawn, covered the whole ground, and he thought it should be amplified in committee. His main point, however, was that clause 16 was not retrospective. He wanted to point out how very serious would be the position in which those persons would be who were bound by existing contracts and by conditions similar to those which this bill would make void in the case of future contracts. If the bill became law those persons would be left in a much worse position than they were now in; that was to say, they would be bound by onerous and oppressive conditions and yet have to com- pete with men who coming after the passing of this bill would not be hampered in a similar manner. Something ought to be done in the interests of those persons. Possibly a remedy might be found by extending clause 11, which related to petitions for the revoca- tion of patents. He suggested that upon a petition for the revoca- tion of a patent the court should take into account the conditions of existing contracts similar to those which this bill would make void in the case of future contracts. That might be one of the grounds on which a patent might be revoked. Of course, he was aware that the mere revocation of a patent would not of itself put an end to the existing contract or relieve the party to the contract from the onerous conditions. But in the case he was supposing it would work out in this way. If clause 11 were altered in the direction he had indicated the effect would be that, through fear of the patent being revoked, such pressure might be brought to bear on the owner of the patent that he would be willing to come to reasonable terms with the persons bound by these contracts. He hoped that if not in this way in some other way means would be found in committee to meet the cases of many persons in the country, especially in the boot and shoe manufacturing industry, who at the present time were bound by the most onerous and oppressive conditions. Sir F. Channing (Northamptonshire, E.) said that he approved of some of the suggestions which had been made by the honorable and learned member for Kingston in regard to clauses 10 and 17, and as to the constitution of a patent court, and he hoped that the latter suggestion would be embodied in the bill at a later stage or in sub- sequent legislation. As to the general scope and character of the bill he was convinced that the president of the board of trade had endeavored in a comprehensive way to cover many of the difficulties that had arisen in regard to patent law and to adjust in an equitable manner confficting interests. They were all anxious to give the greatest possible encouragement to invention. It w^as part of the life- blood of a free-trade country to encourage invention, and there was no taint of protection in giving an inventor a guaranty that he w^ould be protected in the use of his idea and his property rights in it during a reasonable period. The points which had been referred to by the honorable member for Bethnal Green were of grave importance in 12 PATENTS AND DESIGNS BILL. framing a law dealing with patents in a free-trade country. The manufacturers of a free-trade country ought to, and he believed did, welcome every invention to which they could obtain access from abroad which would help to develop their industry, earn them larger profits, and help the community in which they lived. We in this country welcomed ideas and improvements from abroad, but the position of the boot and shoe industry at the present moment was of singular interest and vividly illustrated what might indeed happen in a free-trade country in regard to other trades. They were all aware that the old-fashioned methods of hand-sewn work of 20 or 30 years ago had begun to disappear for some years past, and it became a matter of life and death to that industry to avail itself of all new inventions in machinery, and especially those produced in America. In the Eastern States of America, where this was the leading trade, the application of machinery to it had been carried to the highest possible point. It had become almost imperative that the manufacturers should acquire that machinery for use in this country at any cost and risk to themselves. \| In consequence of this necessity they had placed themselves, it might be said unwisely and without sufficient regard to their own interests or to the interest of the community, under the most onerous condi- tions to acquire the right to use this machinery. So restrictive and so prejudicial to the great industries of this country and to the high- est interests of trade and commerce generally were these conditions that he contended that there ought to be in a bill like this some machinery for dealing with conditions which were wholly prejudicial to our trade. What had happened was this: These American manu- facturers of machinery required for the purposes of the boot and shoe industry had bound themselves together and had accumulated a large amount of capital. They had brought their capital and their ideas to this country. Nobody grudged them that. He welcomed the access of American capital and manufactures to this country. But whilst we welcomed new ideas and fresh stores of raw material from every part of the world and the influx of capital and the products of industry, and whilst we wished to guarantee the fullest patent rights which the law granted the inventor for the use of his inventions, there was another side to the question. It was one thing to do that, but it was quite another for an American company or syndicate to come over here and patent not only its ideas but all the ideas of the American protectionist trusts and to introduce the most tyrannical form of monopoly, restricting the commercial and industrial enter- prise and freedom of our manufacturers and reducing them to the position of having sold all their liberties as industrial men. Our manufacturers would not grudge these men payment for the use of their ideas or their full rew^ard for that use. That would be w^holly inconsistent with the law^ and traditions upon which the whole edifice of British trade had been founded. But the conditions which had been imposed in this coercive fashion when it was almost a matter of life and death for the British manufacturer to accept anything which was in the nature of an improvement of the machinery imported were most oppressive. Our manufacturers entered into agreements which were to last for 20 years, 6 years beyond the length of the life of a patent in this country, and they agreed to continue to pay the royalty on any improvement or new attachment whether it was patented or PATENTS AND DESIGNS BILL. 13 not which might be added to that machinery solely at the will of the manufacturing company. Without the consent and without the leave of the manufacturer, the American syndicate might come and attach to the machinery any alleged improvement and they obtained a fresh lease of their royalty upon the machinery. Under their contract they not only took the right to have the royalty during the period of the patent, but they could })rolong the life of their royalty and levy a toll upon the industry for an indefinite number of years. Another group of cove- nants was also very serious and gave the syndicates and companies far more extended privileges than those which the patent laws of this country had ever given to any inventor. The patent law debarred no one from any access to a new invention, but these companies not only provided that their machines should be used in a fair way, but the users of them were debarred from using any other machines in connection with the machines which had been leased by the company, and that again was extended by this process of adding improvements and attachments. If the business of a manufacturer was successful and some work came in he had no option. He could not go to a Biitish maker of machinery oi to one in Belgium, Germany, or else- where, but was bound forever, or at least during the period of the lease or the prolongation which the syndicates obtained under these covenants, to go on obtaining machinery from and dealing with these companies. That seemed to him a tremendous and improper expan- sion of any right which it was intended to give to any invention by the patent laws of this country. Not only that, but if a firm of manu- facturers under good advice had expended a large sum in obtaining machinery from Germany, that had to be stopped and machines used which came under the conditions of the hiring company. Further- more, if one of these manufacturers had taken a machine from the company which only carried out one of the many operations of the industry, he was bound to use no machinery from any other source for any of the other operations, but to obtain every detail of the machinery used from the syndicate, and any other machinery was agreed to be scrapped. Reference had been made to the revoking of patents, and there were many processes for declaiing them to be invalid, but undei these contracts it was provided that a man should continue to pay fees and royalties in cases in which patents relating to the machine which he had hired had been revoked or otherwise declaied to be invalid. It seemed to him that this was a monstrous and intolerable state of things which should be dealt with in a decisive manner by legislation. He had seen several leases of machmery containing these provisions, and he was assured that some of the leases actually contained covenants and provisions requiiing the lessee to assent to any subsequent condition which the company might impose. He contended that these conditions which had been pressed on a great industry amounted to duress. There ought to be a full and entire remedy for this state of things, and his honorable friend the member for Bethnal Green had said that clause 16 ought to be made retrospective. They who were old members of the House of Commons were well aware how very difficult it would be to get the House of Commons, not to say another place, to assent to a proposal canceling existing contracts. Of course, such a course presented gieat difficulty. In clause 11 of this bill some atcempt, howevei, seemed to be made to move in that direction. If they had the power 14 PATENTS AND DESIGNS BILL. to revoke a patent, not only because the owner of it was not using it and affording proper advantages and facilities to the public who might use it, it seemed to him that they ought to have a clear and effective provision in this clause, and he hoped that in the course of the bill through committee such additions might be made to clause 16, which seemed very good as far as it went, to prevent as regarded future contracts all the injuries to which he had 'alluded. In regard to syndicates holding such a powerful position, they ought definitely and in teems to bar out such provisions as had been imported into these contracts. It was in the interest of the industry of the whole community that such a state of things should not exist. If the bill were to pass in its present form there were points which some of his friends and himself thought were not covered by clause 16, and if some of the other clauses were not amended the position would be intoler- able. He appealed to his right honorable friend to exercise all the ingenuity in his power to defeat what seemed to be a protectionist conspiracy to utilize the open door and the generous hearts of a free- trade country and to endeavor to secure equal opportunity for the development of a great industry so far as it depended on the free use of inventions, whether of this country or abroad, to all men who car- ried on their business in this country. Viscount Turnour (Sussex, Horsham) hoped he would not disturb the harmony which had been the feature of the discussion of the bill that afternoon by commenting on one or two remarks that had fallen from the honorable member who opened the discussion. The hon- orable member had assured them that many goods were sold more cheaply in Germany than in this country. His only comment on that was that it was a remarkable admission for a free trader and a member of the Free Trade Party to make in the House of Commons. He understood that one of the great planks of the free-trade platform was that everything was sold more dearly in a protectionist than in a free-trade country. Apparently, however, the honorable member did not share the views of the great majority of his party. The hon- orable member went on to say that the house in passing this bill would be saying in effect to the inventor: ''We are giving you pro- tection and we expect the country to obtain some advantage thereby." He quite agreed with the honorable member, and he only hoped that at some future date the house in passing a fuller measure of protection would say the same thing to the manufacturers of this country. He thought the honorable gentleman, if it was not impertinent to say so, had spoilt an otherwise excellent speech by the remarks he had made use of at the end in which he said this bill had nothing what- ever to do with fiscal reform, and he could not help thinking of the words used by the present secretary of state for India in 1900 when he said — In this era of militarism which they promise us, domestic reform, constitutional, fiscal, or any other reform will be very slow in coming, but real and deep danger is the loss of our industrial supremacy. Great rivals are springing up against us in all the markets of the world. He did not treat any kind of fiscal reform as one would treat the plague, as the honorable member who opened this discussion appeared to treat it. Then he thought they on that side of the House had listened with great interest to the remarks which had fallen from the honorable member for Northamptonshire, and, although he did not PATENTS AND DESIGNS BILL. 15 intend to follow him into all his arguments about the state of the boot trade in Northam])tonshire, he could not help thinking that that was rather a doleful afternoon for the free importers, because first they had the member for Prestwich telling them that goods were sold more cheaply in Germany than in this country and then they had the honorable member for East Northants giving a (k)leful picture of the state of the boot trade in Northamptonshire and the way in which our American rivals had got the better of us. lie did not wish to turn the debate into a free-trade and ))rotectionist discussion; he only desired to make a suggestion with regard to clause 2 to the right honorable gentleman in charge of the bill. His honorable friend the member for the Kingston Division of Surrey objected to clause 2 on the ground that it might inflict hardshi}) on the poor inventor. He was not sure that he agreed with his honorable friend. It appeared to him that there could be no objection to clause 2 if the right hon- orable gentleman gave to the comptroller full discretion in the matter. Mr. Lloyd-George. He has got it already. Viscount Turnour said he had not seen it. If the comptroller had discretion, it was discretion of a very limited character. His sugges- tion was that the comptroller should be given an unfettered discretion in these matters, because he thought that would get over the difficulty which honorable members on both sides of the house felt. The onl}" other point he wished to refer to was on clause 10. It was with diffi- dence that he made the remark, but it seemed ta him that the effect of the clause would be to throw on the comptroller the onus of defining the meaning of a treaty with, of course, an appeal to the judge. He believed that in previous bills introduced into the House to amend the patent laws the promoters had been very careful to avoid putting that onus upon either the comptroller or the judge. In his opinion it made it rather dangerous if it was intended to give this power to the comptroller or the judge, but no doubt the right honorable member had good reason for putting what he had into the bill. He hoped the bill would pass through all its stages very quickly and become law, and that it would remove one of the many unfair restrictions from which inventors and manufacturers in this country suffered at the present moment. If it was not impertinent to do so he would like to congratulate the right honorable gentleman on, he would not say the fu-st, but one of the first steps w^hich he had taken in the direction of protection. ^fr. Mond (Chester) said the bill made inroads on the rights of patentees in a manner which he thought was scarcely realized. He did not think there was any necessity to reply to the noble lord opposite. The fact that certain goods might be produced more cheaply in a protectionist country, the general fiscal system of the country not being the only consideration in the case, was too ele- mentary to be discussed. To his mind the bill was in no way a step in the direction of protection. He washed to draw attention to clause 9, which, as at present drafted, would lead to the curious result that part of the procedure under it would have to take place before the comptroller and part before a judge; that was to say, if it was desired to revoke a patent on some grounds, application would have to be made to the high court, Avhile, if certain other grounds were taken, the application would have to be made to the comptroller, so that there would have to be two petitions floating at the same time. It was admitted that inventors were the most poorly paid people in 16 PATENTS AND DESIGNS BILL. the country. What was really the grievance of members of the boot trade ? They seemed to have entered into some imprudent arrange- ment and now came and asked the house for a bill to cancel that arrangement and to alter the law in a very important particular in order that they might get out of an unprofitable contract. Clause 16 referred to the avoidance of certain conditions attached to the sale of patented articles. A patented article in this bill was defined as an article made by a patent process. A man made a bleaching powder with a patent and another made it without a patent. Supposing the latter made a contract with a customer to sell to him for 10 years, that contract was not included in the provision. But supposing the man who manufactured by a patented process made a similar con- tract, it could at any moment be canceled as being void in law. He submitted with very great diffidence whether that was not the right interpretation of the very complicated language of clause 16. It was a point to which he seriously drew the attention of his right honorable friend. Under the clause an article made under a process which happened to be patented thereby became a patented article. That might not be the intention of clause 16, but the clause as it now stood was very dangerous indeed. An industry should not have more hardships placed upon it without very serious deliberation, and they ought not to interfere with the right of contract between business people exercised in a business way. Another important point was as to the compulsory working clauses. A great many people were very enthusiastic about the compulsory working clauses. He had some experience of similar clauses abroad, and he did not flatter himself that they would be any more efi^ective here than they had been elsewhere. Their efl^ect abroad had been absolutely nil. He had taken the trouble to look up both the French and the German compulsory working clauses, which provided that where the inventor did not make efforts for the working of his invention in two years, or did not work it for two consecutive years, he lost the right to his patent. Surely it ought to be that somebody should be allowed to continue the monopoly and right to the patent if the patentee did not exercise it in his country or refused to grant reasonable licenses to somebody else. If he exercised the right in some other country, that seemed to him to be a point quite apart and one which seriously conflicted with section 5 of the convention of 1883. As far as he could see, the clause as now drafted seriously contravened that convention, and it appeared to him that the patent office, already overworked, in making an order ,< would have to study every convention to find out whether the order f affected any one of the conventions. He was an English patentee, and he carried on his manufacture in Sweden because of the water power obtained there. Consequently, he would be robbed of the benefit of his invention as far as England was concerned. The bill took away the right of the patentee to go to the House of Lords on a question of the revocation of a patent. After all, patents were very valuable property, and why should the patentee, less than any other subject in England who had the right to go to the highest court of appeal, be under the control of one judge and debarred from taking his appeal to the House of Lords in order to get a decision on a point which might involve millions of money ? He could understand its being done with the idea of saving expense, but patents which were worth anything were, as a rule, worth spending money upon. He PATENTS AND DESIGNS BILL. 17 thought that tlie powers of tho com])t roller would really have to be altered, and if his right honorable friend the })resident of the board of trade could see his way to constitute, once and for all, a coin{)etent court to deal with patent cases, he would confer one of the greatest boons on inventors, patentees, and commercial men, and he was sure it would save an enormous amount of money. At that stage of the bill he would not <^o into further technical points. He thought the bill could very well be referred to a committee, but he hoi)ed that the points he had raised would be very carefully considered, and that they would have when the bill was i)asse(l something which would approach finality. The}" all knew that people connected with patents found it very dillicult to understand the patent laws of the country, which were very expensive and discouraging. He hoped that some of the suggestions thrown out by the honorable and learned member opposite would be carried out and that on the committee stage of the bill the Government would carefully consider, as he had no doubt they would, the amendments which would be placed before them by ex})erts who had devoted the best part of their lives to the subject. Mr. J. D. White (Dumbartonshire) said that anyone familiar with the working of the j^atent system had recognized the necessity of legislation along the lines of this bill. In any legislation dealing with the relation of home and foreign patents it was necessary to bear in mind that we could not differentiate as against foreigners, because, by the international convention of 1883, the subjects of States which w^ere parties to that convention were to be treated on the same basis as our own people. With reference to the actual })roposals of the bill, he thought that a great deal was to be said in favor of the require- ment, as regards certain chemical patents, that the board of trade should have power to require samples to be deposited. This would do a very considerable amount toward lessening the evils which arose from what were commonly called ''paper anticipations." There was a difficulty which he was bound to point out, and it was that the bill proposed that samples might be required to be deposited not merely with a complete specification, but also with a provisional specification. The object of the provisional specification system was to enable the inventor to obtain priority of time and to develop his invention, which he described subsequently at length in his com- plete specification, and until he had developed his invention he might be seriously hampered if he had to deposit a sample with his pro- visir lal specification. The clause relating to restrictive conditions in ' ae use of patented articles was of great importance. It had been all along the case that the patentee had been regarded as ha^dng the field entirely to himself, and that if people used his patent he could impose upon them any conditions he liked. The hardship of that was that where restrictive conditions were imposed and there was a ])reach of those conditions, it was treated by the court not as a breach of contract, but as an infringenaent of the patent, and the whole system of injunction was brought to bear to strengthen the patentee in his position, which was a far stronger and more exclusive one than it was intended by the law to give him. He was glad that this clause IG, which had been so much discussed, had been put into the bill. He would suggest one amendment for the consideration of the right honorable gentleman. The clause dealt only with the restrictions as regarded the use of an article by persons engaged in a trade or indus- 40296—12 2 18 PATENTS AND DESIGNS BILL. try. It seemed to him that this was a highly undesirable limitation, and that there should be an end, once and for all, of these restrictive conditions as regards the use of patented articles, whether they were used in the case of a trade or industry or in the ordinary course of daily life. He suggested that these words of limitation which limited the effect of the clause to articles used in trade or industry should be struck out. Clause 10 seemed to be one of the most important in the bill, but he doubted whether he could support it as it stood. It re- ferred to the revocation of patents worked outside the United Kingdom. He did not put his objection to the clause on the ground of free trade or protection, because that question did not really come in, as patents were certainly not questions of free trade or protection, but monopo- lies which were necessary to protect inventors and experimenters in the result of their labors. Therefore, as it was not a matter of free trade or protection, he proposed to discuss it on other lines. In the first place, he would like to consider what would be the effect in this country. A large number of foreign inventions w^ere brought over to this country. He instanced the case of typewriting machines from the United States. Those machines were sold here at about the same prices as in the United States. Had they any quarrel with that ? If this clause were put into operation it might lead to certain parts of these American typewriting machines being made in this country, but it would increase the cost of production and the price of these articles to the general public. He ventured to think that very grave difficulties would arise under this clause in regard to articles manu- factured exclusively or mainly outside the United Kingdom. He did not know what ''mainly outside" meant, and probably they would require a long series of legal decisions to find out. The great difficulty which the inventor had to face was obtaining capital to work his invention. He was very much afraid that if this clause became law they would find powerful syndicates attempting to freeze out poor inventors by threatening that unless they sold their patents at breaking-up prices they would take steps for an action for revoca- tion. Those considerations weakened the argument in favor of clause 10. He thought the object of that clause could be met suffi- ciently by a satisfactory system of compulsory licenses. He wished to congratulate the president of the board of trade on the changes he proposed to introduce in regard to compulsory licenses in giving those who sought them an easier, cheaper, and more rapid tribunal than the privy council. That would in itself almost be enough. There was another thing which would do a great deal in the same direction, and he would commend it to his right honorable friend. As all those familiar with patent-law actions knew, anyone bringing an action for infringement generally went lor an injunction, and if an infringement was established an injunction was granted as a matter of course. In almost all other patent cases an injunction was looked upon as an exceptional remedy, and it was never granted unless the ordinary remedies would be inadequate. The judges several cen- turies ago, in the reign of James I, treated the infringement of a patent as a contempt of the royal prerogative upon which the patent was founded, and it was dealt with by the star chamber. The star chamber had long disappeared, but the injunction was still wielded by the courts in the same wholesale fashion. He suggested to the right honorable gentleman that the law should be altered in such a manner PATENTS AND DESIGNS BILL. 19 that an injunction should not be granted unless, for one thing, it could be shown that ordinary remedies would not meet the case. If this question of injunction were dealt with it would be an important contribution toward what they all desired. Supplemented by that he thought the system of compulsory licenses which was now pro- posed would effect the desired end. He was glad to see that the Government were dealing with several matters with reference to designs and were laying it down that no designs were to be marked as registered except where there was a subsisting copyright. He would like to go a step further. At present an article might be marked as registered just before the copyright expired. It seemed to him highly desirable that when any person marked a design as registered he should in addition give the year and the number of the registration. That would enable the public to verify the claim and to find out in a simple manner how long a design had still to run. The same argu- ments applied to the case of patents. He thought it was a rather serious oversight in the Government bill that the provision which applied to designs did not apply to patents. Section 105 of the act of 1883 applied to both patents and designs. As the law stood, people could not mark an article as patented unless the patent had been granted, but once granted they could go on marking it patented after the patent had expired. It would be a very good thing if this were so amended as to restrict the marking of any articles as patented to an article which was covered by a subsisting patent, and when the patent expired the right to mark an article as patented ought to cease. In all patents the date and number ought to be given as part of the marking, because without that information it was often impos- sible to find what particular patent was referred to. A typewriting machine might be marked as patented, although the only thing i covered by the patent might be some simple adjustment for the rib- | bon. There was a patent case in the House of Lords not long ago concerning a bottle containing mineral water, ginger ale, which had been marked as patented. The patent did not refer to the bottle, which was of a common type, or to the liquid, which, he might add, was well known to a large number of members of the house. What was referred to was a part of the machinery used in aerating the liquid. How was it possible to find out under the present system what the patent really was ? Therefore he thought anyone who marked an article as patented should be required to give the date and number in order that the public might be able without much trouble to ascertain its duration and scope. For many years we had treated the term '^true and first inventor'' as covering a person who imported an invention from a foreign country. The importation of inventions which the importer had come across abroad was a thing of the past, and the effect of that arrangement now was that a person abroad, instead of acting as a British applicant and making the required declaration as to his being the true and first inventor, had the alternative of communicating it to an agent in this country, who could then obtain a patent in his own name for the invention as a '^communicated" one, and it had been held repeatedly that in the case of a '^communicated" invention no inquiry could be made as to the circumstances under which the communicated invention had been obtained. In the result, if anyone stole an invention and tried to patent it in the ordinary way, he would very rightly be defeated, but 20 PATENTS AND DESIGNS BILL. if he crossed the channel and posted it to an agent, the agent could obtain in his own name a patent for it which could not be challenged on the ground of theft. He hoped that his honorable friends would not think that he was showing people how to steal patents. What was contrary to public morals was not calling the attention of the house to the evil, but the fact that the evil existed. He hoped that when the bill went into committee that evil might be removed, and that they might put applications from abroad on precisely the same level in respect of the requirements as to good faith and originality as applications from people in this country. He considered that a patent should not be granted unless the applicant, or one of the appli- cants, made the ordinary declaration that he believed himself to be the true and first inventor, and that the patent should be upset if a false declaration had been made. He had risen to commend the bill, and hoped that his right honorable friend would not look upon him as a sort of inverted Balaam because he had tried to temper his commendation with suggestions for improvement. He congratu- lated his right honorable friend on the way in which he had under- taken the important and difiicult task of reforming the patent laws and hoped that the measure would have the happy result of pro- moting the industrial development of the country. Mr. Jesse Collings (Birmingham, Bordesley) said that as this ques- tion was regarded as one of the greatest importance in the large manufacturing city which he represented, he would like to say a few words upon it. He congratulated the president of the board of trade upon dealing by an amending bill with the present unsatisfactory state of the patent laws. He rejoiced that the right honorable gen- tleman had not been frightened by the absurd cry of protection . The debate upon this and other bills would be simplified if Liberal members would cease to describe themselves as free traders. They were nothing of the kind. They were simply free importers. He had always been for free trade, but we had not got it. It mystified the question when undue and misleading terms were used. The bill was designed to secure not protection but fair play for British traders against the unfair competition of foreigners. The honorable member for East Northamptonshire seemed to have protection on the brain. The honorable gentleman's speech satisfied the opposition completely in the direction of protection as they understood it. Nothing could be more satisfactory to them than the principles the honorable member had laid down. The honorable member for Kingston had made an important speech, and he hoped the president of the board of trade would give careful attention to the suggestions which he had made. He was sure the right honorable gentleman was alive to the importance of sparing the inventor, and especially the poor inventor, unnecessary expense in connection with legal proceedings. The poor inventor when opposed by a rich rival or by a syndicate often had not only his purse but his heart broken. He hoped the Government would adhere to clause 10 of the bill, which required that articles patented should be manufactured largely, if not exclu- sively, in this country. If the British Government gave a man a monopoly to supply 42,000,000 of people in this country with a par- ticular article that man should be compelled to manufacture a large proportion, if not all of them here, so as to employ British labor in their production. That was absolutely fair. If that was protection. PATENTS AND DESIGNS BILL. 21 all who supported the bill were protectionists. It would be advan- tageous if the Government would define more clearly tlian was done in the bill what proportion of patented i^oods should be made in this country, so as to insure that tJie proportion was substantial. From the point of view of the British inventor and the British workman the arguments of the honorable member for Chester were unsound, and he hoped the president of the board of trade would resist any blandisliments as to alleged protection or anything else and keep in view what would be fair to British inventors, traders, and workmen. He congratulated the right honorable gentleman upon taking this long-delayed amendment of the law in hand, and was confident that the ramifications of its benefits would extend to inventors, commercial men, and workmen. The inventor too often had the advantages whicli would reward his genius and inventive capacity filched from him by the power of gold. He hoped Parliament would protect the individual against that power. ^Ir. Astbury (Lancashire, Southport) said that the honorable member for the Kingston division had raised a number of points which were deserving of consideration. The main object of the bill so far as policy was concerned was contained substantially in the two clauses wliich provided for compulsory working and compulsory licenses, and so far as those two clauses were concerned, with the ex- ception of some possible criticism as to the court before which these matters were to come, he was of opinion that they supplied a long- needed want in connection with the great industries of the country. It was an extraordinary thing that from a land where Perkins's mauve was invented, the color industry should have passed to a for- eign country and that the country which produced the electro magnet and the induction coil should have been passed by other countries in the race for the discovery, application, and completion of electrical inventions. He believed that very largely the reason for this was to be found in our patent system and its administration. Surely the object of our patent laws ought to be in the first place to encourage invention as far as possible in order that scientific research and people ^ who were acquainted with science should be more encouraged in the country and be induced to take more part in developing our indus- tries. The next object, however, was that the monopoly given by a patent should be a monopoly which should be confined to carrying out the intention of the original framers of the statute of monopolies, that it should be subservient to the purpose of introducing and work- ing these patented inventions in this country. iVt present the industries of this countr}^ were largely handicapped by the fact that patents could be obtained with great facility by foreign firms and rich corporations, and manj^ minor patents could be taken out subsequent to the main invention, with the result that, having regard to the great expense of patent litigation, be the patents good or bad, 99 out of 100 of the small traders of the country could not suffer the expense of fighting these great foreign corporations and the inven- tions remained for years unworked here. He wished to add his testi- mony to the courage and ability of the right honorable gentleman in charge of the bill in taking up a subject which not only bristled with difficulty but on which there was an enormous difference of opinion. The question of compulsory working had two sides, and there were a large number of people in the country, many of them 22 PATENTS AND DESIGNS BILL. well qualified to speak, who were bitterly opposed to the notion that we should improve our position by putting the compulsory clause into operation. He was not one of those. He believed that the monopoly which the Crown granted to an inventor ought prima facie to be a monopoly which should be given to and utilized for the benefit of our own industries and our own land. It was said that if that were done it would be a hardship upon the English patentee. He had heard from the honorable member for Chester and others outside the house that if patents could be revoked because they were only worked outside the country many English inventors who had facilities for working abroad and not at home would be deprived of their patents. The first answer to that was that they were absolutely negligible in number, and, secondly, that if that was the case they ought to be deprived of their grants on the same grounds as a for- eigner, if the main object was that the industries of this country should benefit from the monopoly granted. He was far from saying that the bill entirely carried out the object which the right honorable gentleman had, but he knew from the way in which the right hon- orable gentleman had met the views of many who had seen him that he was only too anxious in committee that any further improvements that could be suggested in this respect should be adopted. With regard to compulsory licenses, there was a class of people who believed that the right way to effect what they desired was by way of compul- sory licenses rather than by way of compulsory working. His own view was that that was wrong. The right view, as it seemed to him, was that the best results would be obtained by a combination of the two remedies, because there was a vast difference between enforcing compulsory licenses — after litagation and after difficulties which must arise in the case of a complicated invention — and the simple expedient which said that if the monopoly was granted and it turned out that at the end of three years this country had not benefited from it as it should that monopoly should cease. With regard to compulsory licenses, a question had been raised with regard to the so-called unrea- sonable contracts which were said to have become a practice chiefi}^ in the boot trade. He did not think the house ought to be asked to say that clause 16 should be made retrospective. It was hardly in accordance with sound administration that the house should lay down that a large number of existing contracts should be made void. But so far as he could judge from the provisions of clause 11, any person who was unable to obtain a license except on terms which were unrea- sonable or injurious to trade could apply for and obtain a compulsory license, and if the terms suggested in the contracts mentioned were of the character described the remedy for those who were bound by such existing contracts was to be found under clause 11. With regard to the machinery of the bill, under the designs part of it there was a matter he desired to refer to which was of very great moment to Lancashire, and in which he believed most Lancashire members took a great interest. More than 50 per cent of the total designs registered in this country every year were textile designs under the last two classes in the designs act. In 1905 the house, in the trade- marks amendment act, established a separate system of cotton marks with a keeper or registrar of those marks in Lancashire who was conversant with the requirements of the firms interested in these mat- ters. The proportion that cotton marks bore to the total trade- PATENTS AND DESIGNS BILL. 23 marks of the country was nothing hke so large as the proportion which textile designs bore to designs as a whole. Textile designs were of two classes, either printed or woven, and every year there were registered 10,000 textile designs, of which 7,000 were printed designs. Of these 7,000, more than 6,000 were registered from Man- chester, and more than half of the woven designs were from that center. The universal desire in the textile industries was that there should be a branch registry for textile designs established in Man- chester on the same lines as was done in the case of cotton marks. He trusted that the right honorable gentleman in charge of the bill in committee would allow a clause to be added to the bill with that object. There was also another matter which he regarded as very important in the administration of the law and the clauses of this bill in relation to patents. The honorable member for Kingston had sug- gested with great force that this very difficult and constantly increas- ing matter of scientific litigation should now be placed in the hands of a tribunal which was especially conversant with the matters it would have to deal with and designed for that purpose. The bill as drawn provided that certain matters on appeal from the comptroller of patents should be taken to a judge nominated by the lord chancellor rather than to the law officers of the Crown. Their duties with regard to patents were really almost intolerable at the present time, and if the bill passed in its present form the number of appeals would be quadrupled or more, making it quite impossible for the law officers to attempt to deal with them. He suggested that there should be established a scientific or patent and trade-marks division of the high court in the same way as there was established an admiralty division. Cases in the admiralty division were tried with great facility and dispatch, because of the constant practice there and the continuity in the administration of the law and in its interpretation. Some similar court for scientific industrial matters would be a great step forward and a necessary step if full advantage was to be obtained from the objects and provisions of this bill. But he did not think that it would be desirable that one permanent judge should be ap- pointed to that court. He agreed entirely with the honorable and learned member for Kingston, and for this reason: That it was undesirable in these scientific matters that the law and its adminis- stration should get stereotyped and cramped. They wanted the elasticity of different minds coming to these matters from time to time, and if a division could be established and a judge nominated to sit in it annually by the lord chancellor, it would mark a very great step forward in the administration of our patent laws. If that were done, that judge, sitting in chambers, could take all the matters that the law officers at present took, and the same people would have the same right of audience before him when exercising this jurisdic- tion. It was considered very undesirable by many who were acquainted with the administration of the patent law that the comp- troller should have extended powers, such as were suggested in clause 6, of refusing the original grant of a patent. He suggested that there the law should remain as it was, and that under clause 9 the comp- troller should not have power to revoke any patent except on the grounds on which at the present time he could refuse the original grant. He would suggest further that the questions under clause 10 should go before a judge of the high court and not before the comp- 24 PATENTS AND DESIGNS BILL. troller. It would be a most delicate and difficult jurisdiction to administer, and he believed it would be cheaper and much more effi- cient in the long run that these matters should go, in the first instance, before a judge of the high court instead of before the comptroller. Mr. Meysey-Thompson (Staffordshire, Handsw^orth) said he rose in no spirit of opposition to the bill. There was so much that he thought good in it that he desired not to obstruct it, but to help it forward and make it as effective as possible. He saw, in looking through the bill, that there was no provision for extending the period of protection to the patentee, and he urged that something should be done in that direction. He was quite aware that a patentee -could apply to the' court for such an extension, but he had no guaranty that he would get it. That bore very hardly, especially on the poor patentee with no great weight of capital with which to bring his invention forward. It took some time to perfect his invention, and a considerable time to bring it before the public, and just about the time when it began to pay his patent lapsed and somebody else got the benefit of his brains, energy, and enterprise. The benefits accruing from the inventor's brains, energy, and enterprise should, however, be secured to him, and he asked the president of the board of trade to consider whether it would be possible to introduce a clause increasing the facilities for and reducing the cost of obtaining an extended period of protection. The president of the board of trade (Mr. Lloyd-George, Carnarvon Boroughs) thought the Government had every reason to be satisfied with the reception accorded to the bill in the course of the discussion. There had been substantialh^ no criticism of any leading principle of the bill. The criticism had been directed against points of detail, very important points, no doubt, but all points which, he thought, could be successfully attended to without in any way destroying the general structure of the measure. He might say, for his part, that he would welcome any suggestions in committee, and no pride of paternity would prevent him from giving them favorable consideration so long as the leading principle of the bill was not altogether extermi- nated. He would refer to only two or three leading points that had been raised in the course of the debate. As to the suggestion of the honorable and learned member for Handsworth, it seemed to be fair, under the circumstances he had mentioned that they should have, at any rate, the power to apply to some tribunal to grant an extension of the patentee's monopoly and privilege. The patentee could now, under section 25 of the consolidating act, apply to the pri^^ council. The only criticism that might be passed on that process was that it was a very expensive tribunal, and he was prepared to consider whether it was possible to simplify and cheapen the method of apply- ing for an extension under these circumstances. They wanted, if it were possible, to cheapen the whole process. At the present moment it was almost prohibitive, and it was certainly prohibitive for the poor inventor, who was either denied justice altogether or compelled to part with his patent to the first capitalist that came along. That was a very unfortunate state of things. He was glad to observe that legal gentlemen inside and outside the house showed for the poor inventor a keen anxiety which was very creditable, and he was very glad to see that the honorable member for Chester had also joined them. He desired to say, before he proceeded to any of PATENTS AND DESIGNS BILL. 25 the other ciiticisms, how much lie tlianked his lionorable and kuuiied friend, the member for Southport, than whom there was no hi«^her authority, either inside the house or out of it, on these mattei's, not only for the suggestions he had mack^ that afternoon, but also for tlie very great assistance lie rendered to him before he introduced the bill. The noble lord the member for Horsham had suggested that they should not make the deposit of samples under clause 2 compul- sory in all cases. As a matter of fact, that was provided for already. It was never intended that every patentee of a chemical invention should be compelled to deposit samples. It was left entirely in the discretion of the registrar, and the provision w^as much more elastic than the German regulations in that respect. Clause 6, which had been criticised, was entirely in the interests of the inventor. It was in- tended to cover a case of this kind: They might have an application for a patent which had not been covered by any previous grant. It was, how^ever, thoroughly well known that it was a process in respect of which a patent had been issued in another country and full par- ticulars of which had been published in this country. But, although that was known to all the parties, it could not be referred to in the hearing before the comptroller, and the result was that the comp- troller was obliged to grant a patent which was in itself an invalid patent, and when they came to the subsequent hearing before the court, the whole grant had to be revoked. It would be better if, in the first instance, a patent of that kind could be alluded to, and that the comptroller should have discretion, in a clear case of that sort, to refuse a patent. The present system was simply a premium on litigation. Sir E. Carson (Dublin University) asked whether the appeal in that case w^ould go to the law officers or to the judge. Mr. Lloyd-George said his own Interpretation was that it would go before the law officers, but he was prepared favorably to consider the suggestion which had been thrown out that it would be far better if the whole of the appeals were taken before the special judge who was to be allocated to this purpose. He might sa}" that it was rather his intention, even before the debate of that afternoon, to introduce an amendment to that effect in the bill. He thought it would be an improvement. With regard to clause 10, there again the criticism had not been directed against the principle. The honorable member for Merthyr had put down an amendment, and then, very character- istically, if he might say so, having seen it well advertised in the press, ran away from it. He was not at all surprised, because he knew his honorable friend pretty well. But apart from this firing at a long distance there had been no hostile criticism. The honorable member for Chester brushed aside at once very effectively the suggestion that this had anything whatever to do with the merits of the great fiscal controversy. Therefore he would not go into that, as he had not been challenged. All the criticisms against section 10 had been criticisms upon points of detail. Those would be thrashed out in committee, and he did not think it would serve any useful purpose for him now to give a final answer to suggestions which had been thrown out, and which he had to consider very carefully, because he agreed with the honorable member for Southport that this w^as a very difficult problem altogether. Then he came to the point with regard to the allocation of a special judge. He was not at all surprised that the honorable 26 PATENTS AND DESIGNS BILL. member for Richmond did not agree altogether upon that, because it would be a very serious thing if they had a judge who was not quite adapted to the work — and accidents of that kind had hap- pened — a judge who w^ould be set up in a kind of special statutory court, and who could not well be moved. The point would be con- sidered very carefully; but they had felt that on the whole the best plan was to proceed experimentally, and to get a special judge assigned for the purpose. Of course he could see the advantage of it. If they went to different judges to try patent cases, they had to waste an enormous amount of time in explaining to them the very elements which a judge trying these things constantly would take for granted. Having a special judge they would save time, and that meant saving expense. He was sure they would save at least two-thirds of the time spent on these cases if they had a judge specially versed in them. They proposed, therefore, to start by allocating a judge especially for the purpose, and he was not sure that something might not be done during the committee stage in the way of altering the rules and things of that kind, which would in effect set up a special court, without doing it in so many words. Now he came to the important question which had been raised with regard to clause 16 — the avoidance of certain conditions attached to the sale, etc., of patented articles. It was no secret that that was put in very largely owing to the remarkable character of the contract which was forced upon the boot and shoe industry by an American firm. Nine-tenths of the boot and shoe manufacturers of this country were practically bound hand and foot by that contract. It would be a very serious matter if another invention was to come in, effecting a great saving of time and expense, and they could not take advantage of it, for they might be beaten out of the market altogether. That was a state of things which they could not possibly contemplate, and it made no difference at all whether the firm was British or American. After all, a patent was a privilege granted by the Crown, and Parliament had a right to declare the con- ditions under which the monopoly should be granted. He had been pressed to make the clause retrospective, but it was a very serious thing to introduce into an act of Parliament a provision which would invalidate contracts, and nothing but a great public necessity would justify it. In this case he did not think it ought to be done, except under conditions which would protect the inventor as well. The possessor of these patents had entered into a large number of contracts with manufacturers, and no doubt when he came to settle the terms upon which he let his machines be made he would take into account the security which that contract gave him for a good many years to come. It was an asset. He might have raised a considerable amount of capital, and if he knew that the contract he was entering into was void, he probably would have asked for a bigger royalty, and at any rate he was entitled to reconsider his position with those who entered into the contract with him. After all, they must be fair to all parties. He was not sure that, if they said that certain clauses in a contract should be void, it would be quite fair to future purchasers of that machine. When the syndicate owning the patent knew that they could not enter into a similar contract they might say that in future they would demand a higher royalty. It would be unfair to those who entered into contracts in future if they had to pay more for the machine than those who had entered into the contract already and PATENTS AND DESIGNS BILL. 27 had been liberated by act of Parliament, lie agreed that something ought to be done. His honorable and learned friend thought that clause 1 1 met the case, but he was not sure that it met the whole case, and he was prepared to consider any amendments that might be moved to meet it so long as those contracts were invalidated under conditions which would be perfectly fair to both parties. In regard to a special office in Manchester, though he could not at present give a pledge, he rather thought they would be able to meet the case. It would be a great convenience to the Manchester manufacturers to be able on the spot to examine the designs instead of coming up to London. He would consider it very fully, and he thought it could be accomplished. He had now dealt with nearly all the criticisms passed on the bill, including those of the honorable member for Bordesley. He agreed with the right honorable member that what they wanted was fair play and justice to British industries. [Sir Howard Vincent: Hear, hear.] He thought that would appeal to the honorable and gallant gentleman. At present some of the powerful foreign trusts were able to bring pressure to bear, by their great financial resources, to prevent bona fide inventions taking root in this country to begin with. They crushed them in their infancy by legal action. It was a case where they practically drove some branches of British industry out of the field altogether, as it were, because they were never allowed to start at all. He trusted that when this bill was passed they would be able to put an end to that practice forever. Mr. Bonar Law (Camberwell, Dulwich) said that, as the only mem- ber on the opposition side of the house who had been connected with the board of trade, he naturally followed closely measures which came from that department. On personal grounds he had legitimate cause of grievance against the president of the board of trade. It was the duty of the opposition to oppose, and his colleagues had no reason to complain that their activity in that respect had been interfered with by the members of the Government. His colleagues had opposed, and had enjoyed their opposition. He also would have enjoyed opposing, but he had not had the opportunity, for hitherto he had only been able to play the very uninteresting role of supporting the measures brought forward by the right honorable gentleman. That really pointed to what was a recognized fact, that trade questions were not in any sense party questions; and he was sure the right honorable gentleman would admit that from the opposition he had received not only no factious obstruction on trade questions, but a measure of support which was not usual. In regard to this bill, he entirely approved of the objects which the right honorable gentleman aimed at, and to a very large extent of the methods by which he intended to carry them out. In regard to the court before which these patent cases were to be tried there was a good deal to be said for the view of the honorable member for Chester. The issues involved in these cases were often enormously large, they could be taken from one court to another, and it seemed unfit that a question that involved millions should be finally settled by one judge. But in all these cases there was a balance of advantage and disadvantage, and personally he thought the balance of advantage on the whole distinctly was that the cost of securing patents should be made as low as possible. There- fore, it was at least worth while trying to have such cases tried before one judge, who, as the right honorable gentleman had promised, 28 PATENTS AND DESIGNS BILL. would be specially devoted to the work and specially competent to develop it. The second point to which he wished to refer was that mentioned in clause 2 of the bill, which had relation to the conditions on which patents for chemicals were to be granted in future. He did- not think the right honorable gentleman was perfectly just to hia noble friend on this point. He did not think the bill, as it at present stood, gave the protection which the right honorable gentleman thought it gave. What ought to be done was to give the comptroller power, provisionally at least, to grant protection long enough to enable the inventor to secure sufficient financial support from capitalists. As the right honorable gentleman had pointed out in introducing the bill, Germany had practically a monopoly in many branches of the chemical industry. Where that monopoly was due to superior methods, there was no ground for complaint. It was the fair spoil of Germany's bow and spear. But, however obtained, that monopoly had been confirmed and strengthened by this country's patent laws. They had this effect — that a syndicate or large capitalist would take out a patent to cover much ground without working it at all. There- fore, inventors were prevented from going in that direction at all. In Germany the patentee was not allowed to cover the same amount of ground, and, therefore, the field was left much more open to com- petition. We should adopt the same system in this country. As to the clause preventing contracts similar to those which now prevailed in the boot trade in this country, he admitted that it was a strong measure to interfere with contracts deliberately entered into by busi- ness men who knew what they were doing. But these contracts were in a special position. The man who made these conditions was only able to make them by means of the special privilege given by our laws ; and, therefore, it was reasonable to take care that that especial privi- lege was not used detrimentally to the interests of this country. But he agreed that it would be unfair to make the clause retrospective and it seemed to go further than was necessary to meet such cases. If that were true, and if he was right in his view, the industries affected would certainly make representations to the board of trade, and he was sure that the department would give them every consideration. The only other point in the bill was as to compulsory working. The right honorable gentleman showed that he was disappointed that the honorable member for Merthyr had not brought forward his amend- ment, but if the president of the board of trade was disappointed, he himself was much more disappointed. If the president of the board of trade had not made an epoch-making invention, he had certainly become the apostle of a new faith on the other side of the house. He had looked forward in this debate to something in the nature of a heresy hunt ; and it would have been very interesting if the honorable member for Merthyr had persisted, for a heresy, to be effective, must come from one's own household. With the best will in the world toward the right honorable gentleman, he was bound to say that he could not see his way to defend him against the honorable member for Merthyr, for in this matter the right honorable gentleman was undoubtedly a heretic. This was essentially a bill that sapped the whole theory on which our present fiscal system rested. A^hat was the root theory of our present fiscal system ? That it was our interest to get any products consumed in this country from any quarter of the world where they were produced to the best advantage, without PATENTS AND DESIGNS BILL. &9 regard to wliotlier or not they were produced in this country. The right honorable gentk^man said that a ])atent was entirely different; that it was a monopoly, and that we had a right in granting the monopoly to see that it was used to the advantage of this country. That w^as true. But the question was not one of right. We had a right to put on an import duty if we thought it to our advantage. It was merely a (]uestion of interest. Apply that princij)le to a ])atented article. Leave it to the free j^lay of economic forces, and what hap- pened ? The foreign patentee ])r()duced in this country if it paid him, and he produced abroad if it paid liim. Let him j)roduce abroad, and let us pay for it by those goods which we could ])ro(luce with advantage here — since goods must always be paid for with goods. If that were sound theory, why com})el the foreign patentee to produce here? There could be only one answer — that, in the opinion of the right honorable gentleman, it w^as in the interest of this country that these things should be produced at home. If that were so as regarded the question of principle, there was no difference whatever whether the result were produced in one way or another. If it were right to pro- duce the result by patent laws, it was equally right to produce it by import duties. The right honorable gentleman had pointed out that America alone had not insisted upon patents being worked in America. He felt sure that everyone in the house knew the reason for that, because it was perfectly obvious. When he was at the board of trade he happened to see a document wdiich came from a member of the American Government dealing with the compulsory working of patents. This w^as the substance of what the writer said: ^'What is your object," asked the writer, ''in having things compulsorily made? It is to get them made in the United States. What is the most effective way of securing that end ? Why fool about with patent laws ? If you want them made in the L^nited States put on a duty, and the things w^ill be made in the United States." The right honor- able gentleman's system, then, was more protective than the system of the United States, for he made the production in this country universal. The right honorable gentleman really adopted the prin- ciple which insisted that the system should be applied not only to the articles which we were adapted to produce, but that the articles which we were not able to produce should be made in this country provided they were the objects of a patent. [''No."] For the views which he personally held on this question he had received the greatest possible encouragement from the present Government. That encouragement had come from tw^o quarters. First, from the secretary of state for war, who was supposed to represent high thinking in the cabinet, although he did not know whether his colleagues in the cabinet took that view. A few weeks ago the right honorable gentleman made the curious statement that the law of free trade depended on circumstances; it was not applied at all times; it was a question of the conditions of the country that imposed it and the conditions of the country which wished to trade. That was an important admission. Let honorable members cast their minds back to their election speeches at the general election. [Cries of ''Order."] Was that too great an effort? Then let them try to imagine what those speeches would be like if subject to the condition laid down by the secretary for war. They could not talk about the consumer paying the duty, nor about the universal advantages of free trade; and then he w^ould like to hear a speech from 30 PATENTS AND DESIGNS BILL. the riglit honorable gentleman and to enjoy the privilege of answering him. Secondly, the opposition had received another encouragement from the president of the board of trade, who represented the prac- tical spirit in the Government. The right honorable gentleman had lived up to the precept of the secretary for war. He had treated every question in his department as being one of expediency; he had looked at every question and had dealt with it from its own point of view, and nothing else. What was the result ? Last session the right honorable gentleman passed a bill, a beautiful bill, which had the effect, and it was intended to have the efTect, of protecting the shipping industry, not against foreign competition, but against unfair foreign competition, which was the only kind of protection the opponents of the Government had any sympathy with. Now, in this bill which the right honorable gentleman was piloting through the house he had gone a long step further, for it undoubtedly, in principle, sapped the foundation on which the whole of our fiscal system was based. [Ministerial cries of ^^No, no."] The solicitor general (Sir W. Robson, South Shields) said that in this bill the Government were concerned about the general trade of the country, and they were dealing with the patent law, which was essen- tially a protectionist law, with sufficient and excellent excuse. It was necessary to give a particular kind of protection here in order to stimulate invention; and the fact was that the patent law was pro- tectionist in a more severe degree than any tariff could possibly be, because it was practically prohibitive against the manufacture of cer- tain things except under certain conditions. That being so, this bill proposed to restrict the rights of monopolists whom the patent law had created; yet because the Government proposed to restrict the rights of monopoly they were told that they were deserting the cause, of free trade. Sir Howard Vincent. Never mind that. Sir W. Robson said the honorable gentleman asked for an applica- tion of the free play of economic forces to patent articles; but patent articles were wholly withdrawn from the free play of such forces. That was one of the reasons why the Government had introduced these clauses. Under the existing law proprietors of foreign patents had attached as conditions in the exercise and use of inventions in this country certain very onerous terms, such as — If you use our machine you can use no other for creating this particular commodity. and— You shall not avail yourself of any other invention. There might be a new device invented which would revolutionize the trade of the country, but many manufacturers were incapacitated from availing themselves of that invention. There was not only this prohibition of the free play of economic forces, but there was also a serious impediment to trade and invention, by the use to which a par- ticular class of foreign monopolist had put his patent. It could not be said, therefore, that the Government were deserting the cause of free trade when they restricted the power of such a monopolist as that, and asked for a fairer latitude to be given to the trader who was obliged by law to go to that particular vendor for the machinery that he wanted. On one occasion he had seen an agreement which im- posed restrictions on the British users of a particular class of machine. PATENTS AND DESIGNS BILL. 31 The contract was made for 20 years, though the period of the })ateiit was for 14 years only, so that the American inventor by that device had in effect secured a prolongation of his patent. It was clear, therefore, that this legislation of the Government made for more freedom and less protection. Sir Howard Vincent (Sheiiield, Central) said that he did not care what the party supporting the Government called themselves as long as they brought in bills like this, designed to assist the manufacturing industry of the country. He thought that the whole-hearted su])port of the opposition should go out to the Government in their present effort, and he thanked the president of the board of trade for the great pains he had taken to master a difficult subject and to protect our inventors. Nothing could be more unfortunate in our manufacturing industry than to see how impossible it was for our inventors to derive profit from their inventions, especially in the case of men with re- stricted means. Any measure which simplified the patent law and secured to a man the product of his own invention was one to be approved. He was quite sure that the great mass of the people of Sheffield would be grateful to the president of the board of trade for the pains he had taken in regard to this matter. Mr. Radford (Islington, E.) said that as nearly all the things he had intended to say had been already said, he had very little to trouble the house with. He did not propose to discuss whether clause 10 was free trade or protection, but he wished to point out one or two impor- tant results of it. For the first time in this country there was going to be introduced what was known as compulsory working. That system had been tried in many countries abroad, but it had been abandoned as a failure where tried. There was no compulsory work- ing in the United States nor in the Commonwealth of Australia. If manufacture or compulsory working of the patent was to be enforced in this country, he thought it would be a serious matter for the poor inventor. He would like to remind the house how far they had advanced since 1902. In that year a conservative government passed a patents act under which it was provided that if a manu- factured article was manufactured mainly or exclusively outside the United Kingdom the patent might be revoked, but only in cases where the reasonable requirements of the public had not been satisfied. It was left for a liberal government in 1907 to bring forward a pro- posal, with the support of the right honorable gentleman, the member for the Bordesley division, that a patent should be revoked, although the demands of the public were satisfied, simply because the patented article was manufactured abroad, and he thought that was an advance wdiich ought to be noted by the house. It was the habit of our colonies periodically to go through our statute book and adopt those measures which they thought advantageous to themselves, and it was extremely likely, if this bill became law, that in the course of a few years nearly all our colonies would adopt it. Then in our colonies a condition of the validity of a patent would be that the patented article should be manufactured in the colony where it was granted. He did not know whether manufacturers here were prepared to face that contingency. It appeared to him to be a heavy responsibihty to take. Further than that, foreign countries would retaliate by having an equivalent of clause 10 in their patent laws. The result would be that everv manufacturer who set out with the intention of 32 PATENTS AND DESIGNS BILL. supplying the world would have to be prepared to establish a factory in every British colony and in every foreign country. That would involve a great addition to the cost of manufacture, and, of course, an enliancement of the price to the consumer. He doubted whether clause 10 was well advised, and he hoped that it would receive further consideration. Clauses 6 and 9 afforded grounds for litigation which made him shudder, and he appealed to the right honorable gentleman in the interest of the poor inventor to reconsider that matter. He had known poor inventors who had become rich as the result of their inge- nuity and prudence, but he was satisfied that if clauses 6 and 9 remained in the bill in their present form, the fortunes which inventors had hitherto made would in future be transferred to rich corporations. Question put, and agreed to. Bill read a second time, and committed to a standing committee. Referring to the following instruction of which the honorable mem- ber for Kingston had given notice, ' 'That it be an instruction to the committee that they have power to insert in the bill provisions for establishing a special tribunal for the hearing of all actions and proceedings relating to patents" — Mr. Speaker. If by that the honorable member intends the allo- cation of all patent matters to one particular judge, that can be done under the bill as it stands now, but if he goes beyond that, and intends to constitute a special division of the high court of justice to deal with patent matters, that would be beyond the scope of the bill. In reference to the following notices — Mr. Watson Rutherford. After second reading of patents and designs bill, to move, That it be an instruction to the committee to insert provisions that the patent granted in the United Kingdom to or on trust for any foreigner as a communication from abroad shall be ipso facto determined on the determination of the patent in the foreigner's own country from any cause whatever. Lord Balcarres. After second reading of patents and designs bill, to move, That it be an instruction to the committee that they consider the desirability of hearing counsel and examining witnesses with regard to Part II of the bill — Mr. Speaker. These instructions being mandatory are both out of order. No mandatory instructions can be given to a committee of the whole house or to a standing committee. Mr. Rawlinson (Cambridge University) said he understood that the bill did not give power to relegate all patent matters to a judge. The present state of the law was that every application for a revocation was bound to go before a judge. This bill proposed to abolish that system and invest the comptroller with power to deal with such cases. The instruction of which his honorable and learned friend had given notice was that there should be a judge to whom all matters under this bill should be referred. At present the bill only gave the judge power to deal with certain cases under the bill. Mr. Speaker. An amendment can be moved in the committee stage to transfer to a judge those matters proposed to be sent to the comptroller. Mr. Cave said that what he desired was that the committee should have power to consider the question of referring to a judge, or a division of the high court, not only arising matters under this bill, but all patent matters. While that was no doubt outside the clauses of the bill, he thought it was within the general scope and intention of the bill. PATENTS AND DESIGNS BILL. 33 Mr. Speaker. I think tliat is beyond the scope of the bill which is to ''amend the law relating to patents and designs." The honorable member proposes to go beyond that. [Commons, August 9, 1907.] As amended (by the standing committee), considered. New clause: A defendant in an action for infringement of a patent, if entitled to present a peti- tion to the court for the revocation of the patent, may without presenting such a peti- tion apply in accordance with the rules of the supreme court by way of counterclaim in the action for the revocation of the patent.— (Mr. Lloyd-George.) Brought up and read the first and second times, and added to the bill. New clause: Rules may be made under the principal act for regulating the matters dealt with in subsections 2 and 3 of section 47 and in section 48 of the principal act, which relate to the form and manner in which applications for the registration of designs are to be made, and on the coming into operation of any such rules the said enactments shall be repealed. — (Mr. Lloyd-George.) Brought up and read the first time and second time, and added to the bill. Mr. Lloyd-George, in moving a new clause (procedure on petitions for extension of term of patent), said that he submitted it to the house in redemption of a pledge which he had given in committee to the honorable and gallant member for Handsw^orth. It did not go quite as far as the clause proposed by the honorable and gallant gentleman in committee, but it went as far as they could safely do at present. New clause: The following section shall be substituted for section 25 of the principal act: (1) A patentee may, after advertising in manner provided by rules of the supreme court, his intention to do so, present a petition to the court praying that his patent may be extended for a further term, but such petition must be presented at least six months before the time limited for the expiration of the patent; (2) any person may give notice to the court of objection to the extension; (3) on the hearing of any petition under this section the patentee and any person who has given such notice of objection shall be made parties to the proceeding, and the comptroller shall be entitled to appear and be heard, and shall appear if so directed by the court; (4) the court in considering its decision shall have regard to the nature and merits of the invention in relation to the public, to the profits made by the patentee as such, and to all the circumstances of the case; (5) if it appears to the court that the patentee has been inadequately remunerated by his patent, the court may by order extend the term of the patent for a further term not exceeding 7, or, in exceptional cases, 14 years, or may order the grant of a new patent for such term as may be specified in the order and contain- ing any restrictions, conditions, and provisions the court may think fit.^ — (Mr. Lloyd- George.) Brought up and read a first time. Motion made and question proposed, ^'That the clause be read a second time." Mr. Meysey-Thompson (StafTordshire, Handsw^orth) said tliat in rising to speak on this new clause he wished first of all to acknowl- edge the ability and courtesy displayed by the president of the board of trade mth regard to this question. On the first occasion on which lie called the attention of the house to the necessity of reduc- ing the cost and increasing the facilities for the extension of the period of protection in the case of small patentees, the president of the board of trade immediately and very courteously adopted the 40296—12 3 34 PATENTS AND DESIGNS BILL. suggestion and declared his intention of embodying a clause in the bill to cover what he advocated. Afterwards, when in committee he brought forward his new clause, the president of the board of trade gave the matter his most careful consideration and eventually he brought in the clause as it now stood, to which he would give his cordial support. Naturally, he would have preferred the new clause in its original form as he introduced it, namely, that the authority who was to deal with the extension of the period of protection should be the comptroller of the patent office, since his object was especially to reduce the cost of and to simplify the process of extension which he honestly thought would be best accomplished by the clause as it stood in his name on the paper. Briefly the case was as follows: At present an application by a patentee for an extension of the period of protection must come before the judicial committee of the privy council, a process which costs the patentee at least £500 and fre- quently a much larger sum. This put it quite out of the reach of the small patentee. By this new clause he proposed that the comp- troller of the patent office, who originally caused the patent to be granted, and who might if he thought fit, refer the application to the president of the board of trade, should have power to grant an extension of the period of protection. This would be a very simple and inexpensive process. In the new^ clause adopted by the presi- dent of the board of trade the authority to grant the extension should be a judge of the supreme court instead of the comptroller of the patent office. This, he thought, would be more expensive than his own proposal. Still, being convinced that the president had done his level best for this new clause, and as he understood from him that under this clause the cost would be reduced from £500 to something like £50, or possibly £25, he thought that a very sub- stantial boon would be conferred upon a large class of workingmen who were eminently deserving of their encouragement and support. These were the class of men who lent dignity to labor, who instead of merely trying to get through their day's work with as little trouble as possible threw themselves heart and soul into their employment; who studied how they could improve the machinery with which they daily worked; spent their leisure hours in trying to develop such small improvements, and applied for a patent to protect the result of their energy and ingenuity. Surely these people w^ere deserving of help, and it was with the object of making it easier for them to reap their just reward that he had put forward his new clause. They all thought that their geese were swans, but in this ease he preferred to compare his new clause to the ugly duckling of the fable who grew up into a swan, and he hoped that now that the ugly duckling had struggled through its earlier and most dangerous period of existence under the ger ial and generous support of the president of the board of trade and was now fledged it might accom- plish the object that they had in view, namely, to bring increased profit and pleasure to many who were entitled to all the assistance which they had it in their power to give them. He therefore thanked the president for his adoption of the clause, and had great pleasure in supporting the proposed clause and withdrawing his own, w^hich had been so generously met by the clause the right honorable gentleman had now introduced. PATENTS AND DESIGNS BILL. 35 Mr. Staveley-Hill (StafTonKshiro, Kinj^svvinford) said ho had read with caro the clause which the lionorable and galhint inember for Handsworth had proposed in committee, and agreed with every particidar in it, but he t]iouo:ht they ought to fall in with the clause now suggested by the president of the board of trade. He wanted to know, however, whether they were assured that the procedure pro- posed under the new clause would be removed from the judicial committee of the privy council to the supreme court. Mr. Lloyd-George said it would be removed to the supreme court and the case would be considered by specially ap])ointed judges. Question put and agreed to, and clause added to the bill. Mr. J. D. White, in moving a clause (exemption of innocent infringer from liability for damages), said that his object was to give the public some protection. As things at present stood, a patentee was under no obligation whatever to notify the public that there was a patent for the article, and the object of the amendment was that even if the article was marked '' patent" it should not be deemed to con- stitute notice of the existing patent unless the word was accompanied by the 3'ear and number of the patent. If a patentee wished to secure damages for the infringement of his patent, the first thing he should do was to communicate with the infringer. It seemed to him to be an abuse of the system to mark an article with the word ^'patent" so as to prevent competition after the patent had really expired. Of course the amendment provided that nothing in the new section should affect any proceedings for an injunction. He would like to make two small amendments in the clause which had been suggested to him. In the first line, after the word ^'damages/' to insert ^4n respect of any infringement" ; and in the third line to strike out the second, ^^the" and substitute ^^such." New clause: A patentee shall not be entitled to recover any damages in an action for infringe- ment commenced after the commencement of this act from any defendant who proves that at the date of the infringement he was not aware of the existence of the patent, and the marking of an article with the word "patent," "patented," or any word or words expressing or implying that a patent has been obtained for the article stamped, engraved, impressed on, or otherwise applied to the article, shall not be deemed to constitute notice of the existence of the patent unless the word or words are accom- panied by the year and number of the patent. Provided that nothing in this section shall affect any proceedings for an in junction. — (Mr. J. D. White.) Brought up and read a first time. Question proposed, '^That the clause be read a second time." Lord II . Cecil said he could not believe that the Government would accept such a provision. In the case of saccharine and other chemi- cal patented articles which were row imported into this country, how on earth were they to mark them as proposed by the clause ? A common defense w^as that the infringer of a patent did not know that the imported article was imported or was a breach of a patent or that he thought that it was made in such a way that it did not infringe the patent. It was no defense for taking away another man's property to say that it was taken in ignorance. Surely it would be a monstrous proposition that under no circumstances was a patentee to be able to recover damages under this clause for infringement of the patent of any chemical material, because such material could not be stamped. 36 PATENTS AND DESIGNS BILL. Mr. Lloyd-George, in accepting the new clause, pointed out that the matter was discussed very fully and at very great length upstairs, and he recognized at that time the difficulty of the question. The general if not the unanimous feeling of the committee was in favor of some- thing of this kind being inserted in the bill. The object was to secure that every patented article should contain some notification, not only of the fact that it was patented, but of the date on which the patent was granted. The Government therefore accepted a clause dealing with the question. At the time they accepted it they were satisfied that it met the exigencies of the case; what they meant to deal with was this, that at present there was no doubt that the patentee could go on manufacturing a patented article and selling it as patented long after the patent had expired, say, 60 or 70 years after. He thought they ought to take the American precedent and mark the product, but of course if they could not, as in the case of chemicals, mark the product, they must mark the bag. Lord R. Cecil said the bulk in the bag was split up and the product sold retail in small quantities. Mr. Lloyd-George admitted that of course that might be done, but said he was not satisfied with the clause of the bill as it passed away from the committee, and he thought after consulting his advisers that this proposed new clause was the fairest way of carrying out the inten- tion he had. Mr. Astbury (Lancashire, Southport) asked the right honorable gentleman to make three alterations in the clause, otherwise he thought it would be wholly unworkable. First of all, it ought to be limited to patents granted after the passing of this act. It was not fair that people who already possessed and were working patents should have their trade interfered with retrospectively. Secondly, he suggested that after the word '^ aware," in line 4 of the amendment, the words ^^or could not with reasonable diligence have become aware" should be inserted; and thirdly, that after the words ''marking of an article," in the same line, the words ''or the case of or covering in which the article is contained" should be inserted. If these changes were made he thought the clause would be much more operative and valid than it was at present. Mr. Cave said that this was an entirely new departure in the patent law of this country, and would seriously affect a great many people. Mr. Lloyd-George said it was not a departure from the practice which prevailed in other countries. Mr. Cave said the effect of the clause was this: A patentee might get an injunction against infringement, but he could not get damages unless he proved that the infringer knew of the existence of the patent. That opened a door to fraud, because a man who had knowl- edge might go on infringing, and when the action came on he might say he did not know of the patent. It was sometimes very difficult to prove knowledge, though knowledge existed. The profits from an infringement might be very large, and yet if the infringer chose to say that he was not aware that he was infringing the patent and was doing so innocently, he was to keep the profits he had made and deprive the patentee of them. He thought the right honorable gen- tleman was hasty in accepting the clause, which was not of such a nature that it should be adopted at short notice. Mr. Lloyd-George said that the chambers of commerce had asked for this. [Cries of "No!"] PATENTS AND DESIGNS BILL. 37 Mr. Cave said another point was that there were certain patents, such as patents for chemical processes, on which a mark could not be put as suggested by the clause. He knew the right honorable gen- tleman was anxious to do what was fair, but he did not think he should accept this clause. Mr. Napier (Kent, Faversham) objected to the amendment. As to the infringer not knowing whether he was infringing a patent or not, he often did not know because he did not choose to know. If this amendment was carried it would distinctly encourage the multiplying of that class of person who made articles and made them purposely without inquiring whether there was any patent which would hinder him from making that article. This was, in his opinion, a very dan- gerous clause. Lord Balcarres (Lancashire, Chorley) said he sympathized with his honorable friend in the desire he had embodied in this clause, and he thought the}^ wanted it in a different form — something more drastic, but, at the same time, something workable. There were a good many things which could not be marked, such as chemicals, which could only be marked on the bags. Flour was another article which could not be marked except in the bulk, either with the word ^^ patent" or '' patented," or with the date of the granting of the patent. As soon as the article was sold retail that safeguard went. He thought the object of the clause was good, and was not surprised that the chambers of commerce should desire something of this sort. Sir F. Channing (Northamptonshire, E.) thought the danger of the patentee suffering from this clause was illusory. If a notification were placed on an article or upon the case containing it, it would be a warning against infringement and the best possible protection to the patentee. Mr. Austen Chamberlain hoped the president of the board of trade would reconsider his decision on the subject. It was to secure a monopoly that a patent was granted by the State, and it was impor- tant that it should be duly carried out, and the patentees should be able to carry out their patent rights on reasonable terms. This clause, however, might involve great hardship to an inventor. A person might become rich and make a large sum out of the invention of another, and they ought not, he thought, to prevent an inventor from recovering damages when use was made of his invention without any license from him. The onus was put upon the patentee, and he thought that the possible result would be that the patentee would be subjected to great hardship. The result of the clause might very often be that the man who could more easily afford to lose would make a profit to which he was not entitled, at the expense of the man who ought to make the profit. Mr. Bowles (Lambeth, Norwood) said he could not believe that the president of the board of trade was going to press this clause, which must press most hardly on the great majority of patentees. The great majority of patentees at the present time were not working in accordance with this section. That was to say, they did not mark the patent with the date of patent and the number. If this clause were passed, every one of the patents now in existence would be at the mercy of anyone who chose to infringe them. If the person did not know or it could not be proved that he knew that he was infring- ing a patent, he thought it would be a most improper thing to proceed 38 PATENTS AND DESIGNS BILL. with a clause like this with so attenuated a house. The right honor- able gentleman could not really have contemplated the results of this clause, and therefore under the circumstances he hoped he would give more time to its consideration with the view to safeguarding existing patents. Mr. Gordon (Londonderry, S.) said he could not see any means by which the purchaser of an infringement of a patent could know that it was an infringement, and if this clause were accepted he would be allowed to go scot free until the patentee had found him out. He suggested that the right honorable gentleman ought not to open the door to frauds of that kind. Mr. Berridge (Warwick and Leamington) said that if the clause was passed in its present form the very remarkable result would fol- low that a premium would be given to people to go about infringing patents without caring whether they were doing so or not. Question put. The House divided: Ayes, 138; noes, 34. (Division List No. 399.) AYES. Ainsworth, John Stirling. Asquith, Rt. Hon. Herbert Henry. Baker, Joseph A. (Finsbury, E.) Balfour, Robert (Lanark). Barnes, G. N. Barran, Rowland Hirst. Barry, Redmond J. (Tyrone, N.). Beale, W. P. Bell, Richard. Benn, W. (T'w'r. Hamlets, St. George). Birrell, Rt. Hon. Augustine. Black, Arthur W. Bowerman, C. W. Brace, William. Branch, James. Brigg, John. Burns, Rt. Hon. John. Burt, Rt. Hon. Thomas. Byles, William Pollard. Campbell-Bannerman, Sir H. Carr-Gomm, H. W. Causton, Rt. Hon. Richard Knight. Cheetham, John Frederick. Cherry, Rt. Hon. R. R. Clynes, J. R. Collins, Stephen (Lambeth). Corbett, C. H. (Sussex, E. Grinstead.) Cowan, W. H. Cox, Harold. Crooks, William. Dalziel, James Henry. Davies, Timothy (Fulham). Duckworth, James. Duncan, C. (Barrow-in-Furness). Dunn, A. Edward (Camborne). Edwards, Clement (Denbigh). Edwards, Enoch (Hanley). Elibank, Master of. Erskine, David C. Essex, R. W. Fen wick, Charles. Ffrench, Peter. Fuller, John Michael F. Gladstone, Rt. Hon. Herbert John. Gooch, George Peabody. Greenwood, G. (Peterborough). Grey, Rt. Hon. Sir Edward. Haldane, Rt. Hon. Richard B. Hardy, George A. (Suffolk). Harvey, A. G. C. (Rochdale). Hazel, Dr. A. E. Hazleton, Richard. Henderson, Arthur (Durham). Henderson, J. M. (Aberdeen, W.). Henry, Charles S. Holden, E. Hopkinson. Horniman, Emslie John. Idris, T. H. W. Jones, Sir D. Brynmor (Swansea). Jones, William (Carnarvonshire). Kearley, Hudson E. Kekewich, Sir George. King, Alfred John (Knutsford). Laidlaw, Robert. Lambert, George. Lamont, Norman. Lardner, James Carrige Rushe. Lehmann, R. C. Levy, Sir Maurice. Lewis, John Herbert. Lloyd-George, Rt. Hon. David. Lupton, Arnold. Macdonald, J. M. (Falkirk B'ghs). Maclean, Donald. Macnamara, Dr. Thomas J. MacVeagh, Jeremiah (Down, S.). McCallum, John M. McKenna, Rt. Hon. Reginald. McKillop, W. McLaren, H. D. (Stafford, W.). Maddison, Frederick. Markham, Arthur Basil. Marks, G. Croydon (Launceston). Massie, J. Micklem, Nathaniel. Morgan, G. Hay (Cornwall). PATENTS AND DESIGNS BILL. 39 Morley, Rt. Hon. John. Morreil, Philip. Morton, Alpheus Cleophas. Nicholls. George. Nolan, Joseph. Norton, Capt. Cecil William. O'Brien, Patrick (Kilkenny). O' Grady, J. Pearce, Robert (Staffs, Leek). Philipps, Owen C. (Pembroke). Price, C. E. (Edinburgh, Central). Rainy, A. Rolland. Rea, Russell (Gloucester). Richards, T. F. (Wolverhampton). Ridsdale, E. A. Roberts, G. H. (Norwich). Robertson, Sir G. Scott (Bradford). Robertson, J. M. (Tyneside). Robson, Sir William Snowdon. Rowlands, J. Russell, T. W. Seddon, J. Sherwell, Arthur James. Shipman. Dr. John G. Silcock, Thomas Ball. Simon, John Allsebrook. Sinclair, Rt. Hon. John. Snowden, P. Stanger, H. Y. Strauss, E. A. (Abingdon). Sutherland, J. E. Taylor, Austin (East Toxteth). Torrance, Sir A.M. Ure, Alexander. Verney, F. W. Walker, H. De R. (Leicester). Walters, John Tudor. Ward, John (Stoke upon Trent). Waring, Walter. Waterlow, D. S. White, George (Norfolk). AVhite, J. D. (Dumbartonshire). White, Luke (York, E. R.). White, Patrick (Meath, North). Whitley, John Henry (Halifax). Whittaker, Sir Thomas Palmer. Williams, Llewelyn (Carmarthn). Wilson, Henry J. (York, W. R.). Wils(m, J. H. (Middlesbrough). Wilson, P. W. (St. Pancras, S.). Wilson, W. T. (Westhoughton). Yoxall, James Henry. Tellers for the ayes — Mr. Whiteley and Mr. J. A. Pease. NOES. Astbury, John Meir. Balcarres, Lord. Beach, Hon. Michael Hugh Hicks. Berridge, T. H. D. Bowles, G. Stewart. Boyle, Sir Edward. Brunner. J. F. L. (Lanes., Leigh). Cavendish, Rt. Hon. Victor C. W. Cecil, Lord John P. Joicey-. Chamberlain, Rt. Hon. J. A. (Wore). Chaplin, Rt. Hon. Henry. Corbett, T. L. (Down, North). Douglas, Rt. Hon. A. Akers-. FelL Arthur. Forster, Henry William. Gordon, J. Harrison-Broadley, H. B. Hunt, Rowland. Meysey-Thompson, E. C. Mildmay, Francis Bingham. Moore, William. Morpeth, Viscount. Napier, T. B. Nicholson, W. G. (Petersfield). Nield, Herbert. Radford, G. H. Rawlinson, John Frederick Peel. Scott, Sir S. (Marylebone, W.). Sloan, Thomas Henry. Staveley-Hill, Henry (Staff'sh.). Talbot, Lord E. (Chichester). Thomson, W. Mitchell- (Lanark). Valentia, Viscount. Younger, George. Tellers for the noes — Lord Robert Cecil and Mr. Cave. Mr. Rawlinson (Cambridge University) said that he desired to amend the clause by inserting after the word ^infringement" the words ^^of a patent granted after the passing of this act," the object being to exclude patents noAv in existence. Amendment proposed to the proposed clause — In line 1, after the word "infringement," to insert the words "of a patent granted after the passing of this act." — (Mr. Rawlinson.) Question proposed, '^That those words be there inserted." Mr. Lloyd-George. I accept that. Question put, and agreed to. Mr. Kawlinson said he had a further amendment, the object of which was to get over the difficulty which was present in all infringe- ment cases showing that a man had knowledge of the fact that he was infringing a patent. The object of the amendment was perfectly simple. He begged to move. 40 PATENTS AND DESIGNS BILL. Amendment proposed to the proposed clause — In line 4, after the words "where he is not aware," to insert the words "or had reasonable means of making himself aware." — (Mr. Kawlinson.) Question proposed, '^Tliat those words be there inserted." Mr. Lloyd-George said he could not accept these words, as he was not quite sure that the form of words was the best that could be found for the purpose, but he would accept the amendment in sub- stance and would either accept these words or find alternative words which effected the same purpose. Proposed clause, as amended, added to the bill. The following amendments were proposed and agreed to without discussion: In page 1, line 15, after the word "devolve," to insert the words "on his personal representatives. ' ' — (Mr. Lloyd-George . ) In page 2, line 8, to leave out from the word "the" to the word "principal," in line 10.— (Mr. Cave.) In page 2, lines 13 and 14, to leave out the words "required by the comptroller," and to insert the words "in any particular case the comptroller considers it desirable so to require." In page 2, line 16, to leave out the words "applicants have," and to insert the words "applicant has." In page 2, line 18, to leave out the word "have," and to insert the word "has." In page 2, line 20, after the word "inventions," to insert the words "are such as to constitute a single invention and." — (Mr. Lloyd-George.) In page 2, line 32, after the word "on," to insert the words "or modification of." (Mr. Astbury.) In page 3, line 14, after the word "an," to insert the word "extended." In page 3, line 36, after the word "wholly," to insert the words "and specifically." In page 3, line 36, to leave out the words "or described." — (Mr. Lloyd -George.) In page 4, line 28, to leave out the word "for," and to insert the word "after." In page 4, line 30, to leave out the word "substituted " and to insert the word "added." In page 4, line 30, after the word "words," to insert the word "or." In page 4, line 31, to leave out the words "described or," and to insert the words "wholly and specifically." — (Mr. Cave.) Amendment proposed to the bill — In page 4, line 33, after the word "opposed," to insert "being a specification deposited pursuant to an application made 50 years or less before the date of the application for such last -mentioned patents' or has been described in any such specifi- cation published before the date of the application." — (Mr. Lloyd-George.) Question proposed, '^That those words be there inserted." Mr. Cave thought there had been some oversight in connection with this amendment. He had had the advantage of a conversation with the right honorable gentleman, and he understood him to drop entirely the power of the comptroller to deal with the position of patents thus described. Mr. Lloyd-George said it was an oversight. He was quite willing his amendment should end with the words '4ast-mentioned patent." Mr. J. Ward (Stoke-on-Trent) hoped the right honorable gentleman was not going to give away the whole purport of the bill in order to get it through that afternoon. These matters were very fully discussed in detail in committee, and he was surprised to find that things agreed to were now in the final stages being abandoned. It looked to him as though they were losing the best part of the bill. Mr. Lloyd-George assured the honorable member there was nothing vital in the words he was omitting. Amendment, by leave, withdrawn. PATENTS AND DESIGNS BILL. 41 A^mendment proposed and agreed to without discussion — In page 4, line 33, after the word "opposed," to insert the words "l)y a specification deposited pursuant to an apphcalion made 50 years or less before the date of the application for such last-mentioned patent." — (Mr. Lloyd-Cxeorge.) In page 4, line 33, after the word "opposed," to insert the words "or described in any specification which has been published before the date of such application." — (Mr. Astbury.) In page 4, line 33, to leave out from the word "opposed " to the word "or, " in line 35.— (Mr. Cave.) In page 4, line 39, to leave out subsection (2). — (Mr. Cave.) In page 5, lines 15 and 16, to leave out the words "eight or section nine of the princi- pal act," and to insert the words "three of the patents, designs, and trade-marks amendment act, 1885." In page 5, line 24, to leave out the words "or the comptroller." — (Mr. Lloyd-George.) Amendment proposed to the bill — In page 5, line 25, to leave out the words "or the comptroller." — (Mr. Lloyd-George.) Mr. J. Ward said he must protest against striking out the words ^^or the comptroller." He remembered tliat in committee there was a discussion of nearly three hours on these very words. Mr. Lloyd-George said this was not the clause tq which the honor- able member was referring, and when they reached that clause he would adhere to the words relating to the comptroller. In this instance the omission of the words was purely a drafting matter. He was told by the draftsman that to retain the words would m^ake interpretation of the clause diflicult, and it was necessary to leave them out. Mr. J. Ward. I hope I can trust you. Amendment agreed to. Mr. Cave moved to leave out clause 14, which, lie said, operated very hardly on a patentee wlio, having got capital and plant together, and having a fair prospect of getting some profit out of his patent, might find himself, at aiiy time within four years, in the position of having to defend his patent at very great expense indeed. Of course, if the opponent lost he might have to pay the costs, but in many cases the patentee was not a wealthy man, and would rather surrender his patent and climb down, possibly on terms, than run the risk of very heavy litigation. He did not think that was right or wise. He thought it far better to act on the English ])rinciple that a patent once granted was good unless it was held bad in an action specially fra^med for that purpose, and that this important power of revocation should be exercised not by the comptroller, but only by a court of law. Questions of patents raised points of very great technical difficulty which taxed the capacity of even the judges for the high court; and, with the greatest respect, he thought tlie duty of revoca- tion ought not to be left to the comptroller. The house ought to be very careful about interference with the rules designed for the protec- tion of inventors, on whom a great part of the industries of the country depended. Mr. Staveley-Hill seconded the amendment. Mr. Speaker. I wid first of all put the question to omit the first line and a half of the clause, and if both sides agree upon that, then I will put the whole clause. Amendment proposed — In page 5, line 39, to leave out from the beginning to the word "any," in line 40. Question put, and agreed to. 42 PATENTS AND DESIGNS BILL. Amendment proposed — In page 5, line 40, to leave out from the word "any " to the end of the clause. — (Mr. Cave.) Question proposed, ^^That the word ^any' stand part of the bill." Mr. Lloyd-George said this was a matter which had been very carefully considered, the clause having no doubt met with opposition from some quarters. Out of about 17,000 patents granted, a very small percentage really became operative, and a large number were retained on the register simply for the purpose of blocking other perfectly bona fide inventions, thoroughly practical, which would serve an excellent purpose if they were patented. What the clause proposed was that there should be a simple procedure for getting rid of these blocking patents, and there were thousands of them simply cumbering the register at present. He was prepared, however, to assent to one or two modifications of the clause, recognizing that they must introduce some security into the life of a patent. If a consider- able sum of money was spent on buildings and developments, it might be thought rather hard that the patent should be upset simply by a decision of the comptroller. But anyone who seriously wanted to upset a patent of that kind would not go to the comptroller under this section, for the simple reason that the ground would be very limited. Any man who wanted to upset a patent would put about 20 or 30 counts into his petition, and would not risk the whole thing on the very narrow ground stated in the section. He was perfectly prepared to accept the amendment of his honorable friend the member for Launceston, cutting down the four years to two years. If the honorable gentleman felt that there was any real danger as to security, he did not mind going beyond the court of first instance. That would insure complete protection. He would cut down the limit of time from four years to two, and allow the petitioner to carry an appeal from the court of first instance to the court of appeal and the House of Lords. These modifications could not be made now, but they might be made in another place. Lord R. Cecil feared the procedure proposed would very much increase the cost of proceedings in patent actions. He could not himself see the advantage of approaching the matter by way of the comptroller instead of the court. Under the present procedure, once they obtained the fiat of the attorney general, they could go to the court and then to the House of Lords. Mr. Lloyd-George admitted that this might be the case if the patent was a genuine one, but the object there was to get at patents which were not bona fide. In those cases there w^ould be an application before the comptroller, and there would hardly be any defense at all. Lord R. Cecil thought that when the parties concerned were rich and foreign pirates, whose object was to ruin their competitors, they would probably carry the case to the highest court of appeal. His experience was that these attempts to meet hard cases always put weapons into the hands of the rich, which they used against the poor. He trusted the amendment would be accepted. Mr. J. Ward (Stoke-on-Trent) hoped the president of the board of trade would not concede another point in regard to the clause. A poor patentee if he had a useful patent ought to be able to secure it, although he might not have the financial resources necessary to work PATENTS AND DESIGNS BILL. 43 it. A rich syndicate might come along and take out a patent for precisely the same mechanism. Lord R. Cecil. They could not do it. Mr. J. Ward said the bill presupposed that such a thing could be done. Amendment negatived. Amendments proposed — In page 6, lines 4 and 5, to leave out the words "a patent may be opposed,'' and insert the words "the patent might have been opposed.'' In page 6, line 5, at end, to insert the words ""Provided, That when an action for infringement or proceedings for the revocation of the patent are pending in any court, an application under this section shall not be made except with the leave of the court." In page 6, line 10, after the word ■'application," to insert the words ''but the comptroller shall not make an order revoking the patent unless the circumstances are such as would have justified him in refusing to grant the patent had the proceedings been proceedings in an opposition to the grant of a patent." — (Mr. Lloyd-George.) Amendments agreed to. Amendment proposed to the bill — In page 6, line 10, at end, to insert the words "(3) On the hearing of such petition the comptroller and court shall have the same powers of requiring amendment of specification, and shall be guided in their decision by the same principle as in the case of an opposition to the grant of a patent.'' — (Mr. Radford.) Question proposed, "That those words be there inserted." Mr. Lloyd-George assured the honorable member that the words he suggested were not necessary. Amendment, by leave, withdrawn. Lord R. Cecil moved to leave out clause 15. The proposal in this clause with relation to the revocation of patents worked outside the United Kingdom was really a crude form of protection, affording no help to the poor patentee. It would have no advantage at all, except that it would be to some extent protective in its action. He believed the inevitable result would be what always happened when protective measures were resorted to; it would hit those by whom it was imposed. The clause provided — At any time not less than four years after the date of a patent any person may apply to the comptroller for the revocation of the patent on the ground that the patented article or process is manufactured or carried on exclusively or mainly outside the United Kingdom. In other words, the patentee was to be compelled in the first four years of the patent to make a substantial use of it in the United Kingdom. They were told on the first and second reading of the bill that this clause was directed against the ''rich pirate," but he believed that it was the poor man who would be hit, the man who had patented a meritorious invention, and then had difficulty in collecting enough money to start manufacture within the prescribed time. He begged to move. Mr. Napier seconded the amendment. Amendment proposed to the bill — In page 5, line 19, to leave out clause 15. — (Lord R. Cecil.) Question proposed, ''That the words 'At any time not less than four years after the date of a patent,' stand part of the bill." Mr. Lloyd-George said that the clause was the pith of the bill. He pointed out that in many instances the privilege granted by the Crown in respect of patent rights, instead of being used to start 44 PATENTS AND DESIGNS BILL. British industries, was used to prevent other persons from estabhshing industries in the United Kingdom, causing thereby an increased cost in the production. This clause, indeed, was purely in the interests of free trade, freedom of commerce, and industrial freedom. Mr. Bowles expressed the hope that what had fallen from the right honorable gentleman would have the effect of converting some of his own friends to join in the opposition to a clause which restricted to one country in the world the operations of a man who had secured a patent. [Cries of "No!"] That was his interpretation of the clause. The right honorable gentleman had the courage to tell the house that, instead of restricting, it increased a man's freedom. It was quite clear that the effect of the clause, so far as it had any effect at all, would be protective. There were other objections to the clause, but for that one alone he thought it ought to be rejected. Lord R. Cecil asked leave to withdraw the amendment. Amendment, by leave, withdrawn. Amendment proposed to the bill — In page 6, line 20, after the word "patent," to insert the words "granted after the commencement of this act, and in case of a patent previously granted at any time not less t]jan four years after the date of such patent and two years after the commencement of this act." — (Mr. Astbury.) Question, "That those words be here inserted," put, and agreed to. Mr. G. Croydon Marks (Cornwall, Launceston) moved to add to the clause the words, "for meeting or supplying a continuous demand existing for such patented article or process in the United Kingdom." The object of the amendment was to protect a patentee who might manufacture the article in America or Germany when there was a demand for it there, though during the first four years of the patent there might be no demand for the article in this country. Was a man to lose his rights in the patent in this country because he did not manufacture the article here at a time when there was no demand for it ? He held that it would not be fair to the patentee to deprive him of his rights in that way. Germany was about to alter her laws in regard to compulsory worldng of the patent in Germany, and France also was going to take the step of not compelling the working of a patented article in France. But why should we cut off the patentee's rig!it in his patent after four years because there was no demand for the patented article or process in the United Kingdom? Let them take the case of machinery for operating on fiber such as jute. At present that process was carried on in India, but why should a patentee lose his patent at the end of four years because there was no continuous demand for the article here ? A new fiber might be dis- covered in this country, such as from cabbage leaves, which might be treated with the patent machinery here, but a man should not be compelled to manufacture it until there was a known demand for it. He begged to move. Lord Balcarres seconded the amendment. He said he was very much interested in those processes which would be seriously affected by the bill as it stood, and representations had been made to him by manufacturers against the clause. Under the clause as it stood, wealthy foreign syndicates would have a right to keep their patents alive here. The comptroller had got to decide whether a process was mainly carried out inside or outside the United Kingdom; but there might be some articles, such as those made of steel, which involved PATENTS AND DESIGNS BILL. 45 20 or 30 different patented processes. The duties imposed on the comptroller were already extremely difficult without his having to decide whether there was a continuous demand for a certain patented article or process in this country. The scheme of the amendment was one which ought to receive attention. Amendment proposed to the bill — In page 6, line 23, after the word "Kingdom," to insert the words "for meeting^ or supplying a continuous demand existing for such patented article or process in the United Kingdom." — (Mr. Croydon IMarks.) Question proposed, ^^That those words be there inserted." Mr. Lloyd-George said that it had been asked why, if there was no demand in this country for a certain patented article, should anyone go to the expense of setting up workshops for the manufacture of the article ? But, after all, this was a great exporting country, and it was our interest to manufacture for the whole world, and a patent might be wanted here for some article which was used for export purposes. From any point of view he could not accept the amendment. Mr. Barnes said that if the right honorable gentleman considered this matter, he would see that it really cut to the root of the question and defeated the object for which the bill had been introduced. The honorable member for Launceston had mentioned the jute industry, but that industry was started in this country, and a large number of manufacturers who had exploited the industry here now took advantage of the cheap labor in India and manufactured the jute there. Mr. G. Croydon Marks asked leave to withdraw his amendment. Amendment, by leave, withdrawn. Mr. Rawlinson moved to insert at the end of clause 15 the words ^'or His Majesty's dominions beyond the seas." He took it that the object of the bill was to prevent a man taking out a patent in England and then manufacturing that article in France or Germany because he could get cheaper labor there. He put it that if the patent were to be kept alive in England it should be worked in England for the benefit of British workmen; and he thought that a similar advantage should be extended to the colonies, so as to give the colonies a certain preference. With that object, he ventured to press this amendment upon the House. It did not establish protection or colonial prefer- ence, but it gave the colonies some sort of preference. Mr. Napier seconded the amendment on the ground that it would^ he thought, not give a preference at all, but would slightly limit the protectionist character of the clause. It w^ould, at all events, enlarge the area from which the people of this country would be entitled^ possibly, to buy patented articles. ♦ Amendment proposed to the bill — In page 6, line 23, at the end, to insert the words "or His Majesty's dominions beyond the seas." — (Mr. Rawlinson.) Question proposed, ^^Tliat those words be there inserted in the bill.'^ Mr. Lloyd-George expressed his utter amazement that the honorable and learned gentleman should play so absolutely into the hands of his foes. Did he realize that this would give immunity to American patents ? All that would have to be done would be to set up a factory across the border in Canada, and every American industry would instantly be contracted out of the clause. Did he also know that in 46 PATENTS AND DESIGNS BILL. Canada there was a compulsory working law ? That operated against the British patent and the American patent, and the Americans were obliged to set up factories in Canada, and they had done it. He could not conceive anything more dangerous than the inclusion of this amendment, which would cut out instantly every American patent. The acceptance of the amendment would make the clause absolutely futile. He hoped the honorable and learned gentleman would strengthen his hands by withdrawing his amendment. Lord R. Cecil said the speech made by the right honorable gentle- man was too striking for him not to say a word or two in reply. The right honorable gentleman was an advocate of free trade, and he as one who was in favor of promoting the free exchange of commodities practically said to his honorable friend if he pressed the amendment it would destroy the whole protective effect of this clause. The house would observe how the right honorable gentleman adopted the whole of his friend's argument. As to the argument against cheap labor, it was rather an old friend, and was directed against unfair competi- tion. They did not want protection to bolster up industries, but it was needed to prevent unfair competition. He should support this amendment. Mr. J. Ward said he fancied he had heard all these speeches before. He had heard them in the committee, and he thought they were dealt with very effectively then. He did not understand that there was any protection in the policy proposed. What was suggested was that when we were creating a monopoly and when the article w^as manu- factured the products of the monopoly should not be protected in this country under the patent laws. If the article could be produced more cheaply in other countries, then it would not be produced in this country; but they wished to provide that our fellow countrymen would not be prevented from competing if it could be produced here. They were not applying a protective tax, but it was an extension of free trade, as it gave our people the opportunity of making these things if they could make them. If they could not, the modification of the patent law would not affect the matter. Mr. Hills (Durham) supported the proposal of the board of trade. The amendment looked attractive at first sight, but we could not treat the Empire as one until it was one in reality. The objection to cheap labor was a very important one, and, although at first sight he was inclined to look with favor on the amendment, he thought on consideration it was a bad one. Mr. Rawlinson said that after the very able speech of the right honorable gentleman and the sound principles which he had enunci- ated, he would ask leave to withdraw the amendment, as he felt the country was safe in the right honorable gentleman's hands on this point. Amendment, by leave, withdrawn. The following amendments were proposed, and agreed to without discussion — In page?, Iine25, after the word "manufacture," to insert the words '^ and supply." — (Sir M. Levy.) In page 7, line 25, after the word "article," to insert the words "or any parts thereof which are necessary for its efficient working on reasonable terms." — (Sir M. Levy.) In page 7, line 26, after the word "extent," to insert the words "in the United King- dom." — (Mr. Astbury.) In page 7, line 27, after the word "existing," to insert the words "trade or."-^(Mr. Astbury.) PATENTS AND DESIGNS BILL. 47 In page 7, line 28, after (ho word "new," to insert (he worchs "trade or." — (Mr. Astbury.) Mr. Cave moved an amendment to prevent subsection (h) of clause 16 being retrospective. This subsection provided that the reasonable requirements oi the country shall not be deemed to have been satisfied if any trade or industry in the United Kingdom is unfairly prejudiced by the conditions attached to the purchase, hire, or use of the patented article or to using or working tlie patented process by virtue of any contract with the patentee '^whetlier" macie before ''or after'' the passing of the act. The honorable member said he also intended to move to leave out the words ''or after'' so as to restrict the subsection to a contract made before the passing of the bill. Unless this were done, they would make a man pay a penalty for something which was perfectly legal before the passing of this measure. Lord R. Cecil seconded the amendment. Amendment proposed to the bill — In page 7, line 38, to leave out the word "whether." — (Mr. Cave.) Question proposed, "That the word 'whether' stand part of the bill." Mr. Lloyd-George hoped the honorable member would not press this amendment, as full provision was made for compensation later on in the bill. Amendment negatived. Amendment proposed to the bill — In page 9, line 13, to leave out from the first word "and," and to insert the words *' After the expiration of the prescribed period the comptroller." — {Mr. Lloyd-George.) Amendment agreed to. Amendment proposed — In page 9, line 14, to leave out the w^ords "law officer," and to insert the word "court." — (Mr. Lloyd-George.) Question proposed, "That the word 'law ofiicer' stand part of the bill." Mr. Rawlinson asked whether if they carried this it would affect the discussion of the amendment which he had placed upon the paper to leave out subsection 1 of clause 26. Mr. Lloyd-George said he was told that it would not affect such a discussion . Lord R. Cecil asked whether the right honorable gentleman intended to go any further to-night, having regard to the fact that they were now approaching the discussion of clause 23, which was a most con- tentious clause, or whether the right honorable gentleman proposed when this amendment was agreed to to defer the discussion of clause 23 to another day. Mr. Lloyd-George said it was not late, and there were many members now in the house who desired to discuss clause 23 who might not be present on another occasion, and he therefore thought they might be allowed to go on. Amendment agreed to. Amendment proposed — In page 9, lines 15 and 16, to leave out the words "of the comptroller." — (Mr. Ast- bury.) Amendment agreed to. 48 PATENTS AND DESIGNS BILL. Mr. Cave moved the omission of clause 23, which, he said, avoided certain conditions which were now freely entered into between patentees and business men. The boot trade was quoted as a burning example in favor of this claim, and it was said that there were cases when the right to use a patent connected with the manufacture of boots had been refused except upon conditions that the licensee should use it for all boots which he might manufacture. But he believed that in spite of this condition the licensee had in fact made substantial profits. He knew it was said that the right had been abused. But where business men had found this particular mode of dealing most convenient — both parties to the bargain entering into it with knowl- edge of what they were about — it was a great mistake for Parliament to intervene and say it should be void. Apart from that, the clause was retrospective and avoided existing contracts. There was a com- pensation provision, but no compensation would make up for the avoidance of a contract entered into in the ordinary course of business and upon the faith of which important arrangements might have been made. By subsection (5) the insertion by the patentee in a contract made after the passing of this act of any condition which by virtue of the clause was null and void was made a ground on which the patent might be revoked. Even if the principle of the clause was assumed to be right, it was wrong to go so far as to say that if a man, by inadvertence, inserted one of these conditions in a contract, with A he should be unable to sue B for some flagrant infringement of the patent. That was a monstrous penalty to impose on a contractor. The purpose of the clause was to a great extent already met by clause 16. The whole of clause 23 was very objectionable, and he strongly held the view that there should be no attempt to deal with the mis- chief which was said to exist in the drastic way proposed. Mr. Staveley-Hill seconded the amendment. He trusted that the president of the board of trade would look at this clause in the light in which it was regarded by many in the country. In the legal profession there was a common saying that '4iard cases made bad law." He thought, although this clause was directed to meeting hard cases, it would establish a very bad principle in English law. If it remained in the bill, it would constitute an interference with the freedom of contract between people who were quite able to conduct their business in their own way. They were not here legislating for children or minors but for grown persons who knew their own mind and were able to conduct their own affairs. Not only would it interfere with freedom of contract, but in some trades would bring about a state of things which would inflict great injustice on patentees. It would also act ''in restraint of trade." Therefore he hoped if the right honorable gentleman was not prepared to accept the motion of his honorable friend he would at least consider whether the clause could not be modified. Amendment proposed to the bill — In page 9, line 21, to leave out clause 23. — (Mr. Cave.) Question proposed, ''That the words proposed to be left out, to the word 'any,' in page 2, line 22, stand part of the bill." Mr. George White (Norfolk, NW.) said he would not have asked the Government to pass a general law affecting the commercial interests of the country merely because the existing law pressed hardly upon PATENTS AND DESIGNS BILL. 49 a small industry, but they must judge of the necessity for a change in the law by the magnitude of the industry if it were so affected from the consequences of it, whether they were serious or not. There was a trade with which he was connected and which had grave complaint against the existing law. It was a large industry, and so far as machinery was concerned was practically in the hands of a syndicate which had attained its power in a way which would be prevented in the future if this clause was retained in the bill and became law. Seven or eight years ago the machinery of this trade was largely supplied by the United Machinery Co. That company was bought up by an American syndicate, and in addition to buying the machines which the company provided, it took care to buy up also such other machines as it conceived were absolutely necessary to the carrying on of the business. Consequently it became possessed of a monopoly, and upon the basis of that monopoly altered the conditions upon which the machinery could be obtained by this industry and made them of a very restrictive and tyrannical nature. A large part of the trade were not free agents in the matter at all. He himself was free from these contracts, because the firm with which he was connected obtained the bulk of its machines before the American syndicate established its monopoly. These leases extended the term of the patent to 20 years, and so got round the patent act, and they made additions to the machines, each addition extending the term of the lease, and thus the whole thing became a perpetual burden on the manufacturer. Three-fourths of the boot manufacturers of the country were unable to take up any other machines than those supplied by the syndicate. Very grave injustice was thus done to the whole industry and it would be largely removed by the passing of this clause. Lord R. Cecil said that the fundamental idea of the patent laws was to give the inventor a monopoly, in order to encourage inventions. A patentee might exact any terms he liked. Anyone might reject his machines, but no one did, because even with the restrictions placed by him on their use it was more profitable to use them. It was argued that the contracts of the syndicate referred to by the last speaker involved a restraint of trade which was against public policy ; but that doctrine had been so relaxed that it was now almost impossible to frame a contract which would be pronounced against public policy on that ground. It was held now that it was more in the interest of public policy that grown free men should be allowed to make what contracts they chose amongst themselves. That was the danger which attached to this clause. It was extremely widely drawTi; it was devised to deal with one particular case, and one case only, for he did not know of any other case of a like nature. Under this clause if there were put into an agreement any provision that the purchaser was only to use the patentee's article, the agreement was void. One could see at once how very hardly that might bear in particular cases. A man might have acquired a reputation for a particular kind of goods produced by a particular kind of machinery, and he might sell his machine to a comparatively ignorant user on the terms that he should use it and none other. He could im.agine many cases in which a perfectly reasonable provision of that kind might be made which would do no harm to anyone, even in the view of the honorable member for Norfolk, and to say in the particular 40296—12 4 50 PATENTS AND DESIGNS BILL. terms which this clause laid down that all such conditions and agree- ments were to be void was a somewhat dangerous form of legislation. Here was a hard case, and something must be done to settle it, and they did the something, and found out afterwards that it in itself was something very hard. He was satisfied that this clause, if accepted, would do the greatest possible injury to the industries of this country, and he therefore asked the president of the board of trade not to insist upon it. Mr. Lloj^d-George said he did not propose to enter very fully into this question, not because it was late in tlie session or late in the evening, but because they had dealt with it twice already very exhaustively. There had been a very considerable discussion on it on second reading, and he specially drew attention to this clause when he introduced the bill. There was also a full discussion upstairs, where two days were entirely devoted to the clause. The noble lord was not present on the first occasion, but he did not make that a cause of complaint, though he must be excused from again entering extensively into the question. His honorable friend had gone a little further by explaining one special case which had lately precipi- tated the action of the legislature in this matter. Tf a privilege were abused, surely the legislature which granted that privilege had a right to come in and say the limits w^hich were allowed when the monopoly was granted were being exceeded. This was a case in which for the first time they saw in their sheer nakedness the methods of the American trusts. The noble lord had argued a good deal about general principles as to trade, and he did not disagree with the principles he had laid down. He absolutely agreed with the noble lord about the fulfilling of contracts and as to men of mature judg- ment exercising caution. That was the only w^ay to develop a manly action. But this was not a case in which they had two traders on equal terms to begin with. This was a case in which one man had a monopoly which the community had given him and the other man was left without any defense at all. The boot industry in this country was practically compelled to take a certain machine. Those engaged in the industry were good business men and well able to hold their own in competition, but they were really obliged to sign a con- tract, and a more monstrous contract had never been submitted to an industry. Did the noble lord realize the extent of one of the clauses which was inserted in the contract? It compelled the use of this particular machine, and no other. Supposing there was another patent, either British or foreign, which revolutionized the trade as completely as this one did, and which it was just as necessary for the boot industry to utilize, nine-tenths of the industry would not be able to use the new machine for 20 years to begin with. That was not all. If an improvement of the invention for which a contract had been entered into was taken up at the end of 19 years, the trade was bound to take the improvement, and the lease was renewed for another 20 years. At the end of another 19 years there might be another improvement, and the boot industry would have to take that up for a further period. There was nothing in the contract to prevent a series of slight improvements which might be invented, enabling an equal number of extensions of the lease of its exclusive use to be made, conceivably obliging the boot trade to continue using the same riiachine for 300 years. The industry could not survive it, and the PATENTS AND DESIGNS BILL. 51 legislature was therefore bound to interfere in the general interest, not to protect individual bootmakers who had entered into a bad bargain, but in order to protect a very powerful industry, and to say that this country really could not stand the use of a privilege con- ferred by the Crown for the purpose of hampering a whole trade. The American Legislature had found it necessary to introduce a provision of this kind, and he knew of no country under the sun which would tolerate this kind of thing. In (^anada, he believed, it had been held by the judges to be a contract in restraint of trade. The judges, no doubt, here held it was not in the ordinary sense such a contract; but, at any rate, the legislature ought to come in and say that it was very prejudicial to the trade of the country. He therefore proposed this clause. There were one or two modifications which would be proposed later on. Question put. The House divided: Ayes, 79; noes, 13. (Division List No. 400.) AYES. Baker, Joseph A. (Finsbury E.). Balfour, Robert (Lanark). Barnes. G. N. Bell, Richard. Benn, W. (T'w'r Hamlets, St. George). Berridge, T. H. D. Bowerman, C. W. Branch, James. Brigg, John. Burns, Rt. Hon. John. Burt, Rt. Hon. Thomas. Byles, William Pollard. Carr-Gomm, H. W. Clarke, C. Goddard (Peckham). Corbett, C. H. (Sussex, E. Grinstead). Cornwall, Sir Edwin A. Cowan, W. H. Craig, Herbert J. (Tynemouth). Cremer, Sir William Randal. Crooks, William. Davies, Timothy (Fulham). Duncan, C. (Barrow-in-Furness). Dunn, A. Edward (Camborne). Edwards, Clement (Denbigh). Elibank, Master of. Essex, R. W. Fenwick, Charles. Ffrench, Peter. Findlay, Alexander. Fuller, John Michael F. Gooch, George Peabody. Hardy, George A. (Suffolk). Harvey, A. G. C. (Rochdale). Hazleton, Richard. Henderson, Arthur (Durham). Henry, Charles S. Idris, T. H. W. Jones, William (Carnarvonshire). Kearley, Hudson E. Kekewich, Sir George. King, Alfred John (Knutsford). Lambert, George. Lehmann, R. C. Jjloyd-George. Rt. Hon. David. Lupton, Arnold. Macdonald, J. M. (Falkirk B'ghs). MacVeagh, Jeremiah (Down, S.). McCallum, John M. McKenna, Rt. Hon. Reginald. McLaren, H. D. (Stafford, W.). Morton, Alpheus Cleophas. Nolan, Joseph. Norton, Capt. Cecil William. Price, C. E. (Edinburgh, Central). Ridsdale, E. A. Robertson, J. M. (Tyneside). Rowlands, J. Russell, T. W. Sherwell, Arthur James. Shipman, Dr. John G. Simon, John Allsebrook. Smeaton, Donald Mackenzie. Snowden, P. Stanger, H. Y. Torrance, Sir A. M. Verney, F. W. Walker, H. De R. (Leicester). Walters, John Tudor. Ward, John (Stoke-upon -Trent). Waring, Walter. Waterlow, D. S. White, George (Norfolk). White, J. D. (Dumbartonshire). White, Luke (York, E. R.). White, Patrick (Meath, North). Whitley, John Henry (Halifax). Wills, Arthur Walters. Wilson, Henry J. (York, W. R.). Wilson, W. T. (Westhoughton). Tellers for the ayes^ — Mr. Whiteley and Mr. J. A. Pease. 52 PATENTS AND DESIGNS BILL. NOES. Astbury, John Meir. Bowles, G. Stewart. Brunner, J. F. L. (Lanes., Leigh). Cecil, Lord John P. Joicey-. Cecil, Lord R. (Marylebone, E.). Corbett, T. L. (Down, North). Gordon, J. Harrison-Broadley, H. B. Marks, G. Croydon (Launeeston). Napier, T. B. Nield, Herbert. Radford, G. H. Rawlinson, Jn. Frederick Peel. Tellers for the noes — Mr. Cave and Mr. Staveley-Hill. Bill, as amended (by the standing committee), to be further con- sidered upon Monday next. ADJOURNMENT. Motion made, and question, ''That this House do now adjourn'^ (Mr. Whiteley), put, and agreed to. Adjourned at a quarter before 9 o'clock till Monday next. [Commons, August 13, 1907.] Considered in committee. Motion made and question proposed, ''That clause 1 stand part of the bill." Lord Balcarres (Lancashire, Chorley) said that he hoped the president of the board of trade would tell the committee something concerning the intentions of the Government regarding this measure. Mr. Lloyd-George said that he should be glad to explain briefly what it was proposed to do. He hoped honorable members would allow him to send the bill up to the House of Lords and let them consider the question of the incorporation of the patents and designs bill, as finally amended by them, in it. Of course it would be no use getting the consolidation bill through at all unless the patents bill which the house had just read a third time was incorporated in it. If honorable members agreed to that step, the bill would come down there afterwards, as amended by the House of Lords, for consideration. Lord Balcarres thought that the course taken with regard to this bill was really somewhat inconvenient. He understood that this bill, like all consolidation bills, ought to be referred to a select committee. The bill was now before a committee of the whole house, but it was manifestly out of the question for the House of Commons to attempt to consider the whole of the 80 clauses which were now before them. They might accept the assurance which would, no doubt, be given that there was not a line or a word in the bill which was different from or inconsistent with any existing statute. It was well known that during the last ten or a dozen years there had been cases in which consolidation bills in respect of various statutes had made consider- able alterations of the law, but that had invariably been put right in select committees of the House of Commons. The right honorable gentleman asked them now pro forma to discuss the 80 clauses in this bill, and it was obvious that at 1 o'clock in the morning they could not do it. As that was impossible they were to pass the 80 clauses and give the right honorable gentleman the third reading of the bill with the same dispatch as was shown in the case of the measure just disposed of. They were to send the bill to the House of Lords to- PATENTS AND DESIGNS BILL. 53 gether with the bill which the right honorable gentleman has just piloted through the house and ask for a select committee to be set up in another place. The lords were to be asked to in- corporate in this consolidation bill the 30 or 40 clauses of the bill just passed, and, though the right honorable gentleman might regard it as a simple form of procedure, he submitted that really it was a rather cumberous method. The patents and designs bill was going to be amended by agreement in various respects in the Lords. This bill therefore would have to come down again after consideration; the 80 clauses would have to be reprinted and the whole matter would have to go to a select committee of the House of Commons. They could not, he submitted, pass the bill without letting a committee consider it in some form, because a measure of this kind undoubtedly required very careful and detailed expert examination. It was not right that a bill should be ])assed through Parliament in the last few hours of a session which really required weeks of work, and it might be found on examination that there were certain points in the bill which the house had just passed that conflicted with existing statutes. All these matters needed the most careful explanation, and it was in the interests of sound legislation that he ventured to press these points on the atten- tion of the right honorable gentleman. The Lords would require a few hours to consider the bill, and it would be very late in the session — almost at the very end — before it could come back to the House of Commons. Under the circumstances he ventured to suggest to the right honorable gentleman that it would be a very great advantage if he would consider the propriety of deferring the consolidation of the patent laws, eminentl}^ desirable as it was, until next session, when he was sure it would be treated as a purely formal and noncontroversial matter. Mr. Lloyd-George said that of course he would not be disposed to press a matter of this sort if the opposition were not prepared to accept it. He had understood, however, that in the case of this bill there was not only an agreement, but a desire not to oppose the bill. They had just given a third reading to a bill amending the patent laws, and he thought it was very important that the ordinary layman who was interested in patents should be able to read those laws for him- self. One thing was absolutely certain, and that was that he could not do it now. The consolidation bill could not be taken, however, unless the members of the opposition really assented, and he would be gald to know what their desire in regard to the measure really was. Lord Balcarres said it was not a question whether the opposition objected or not. They did not object to the consolidation of the patent laws, but, on the other hand, they thought it was a tiling that ought to be carried out. As a matter of fact they considered it not only advisable, but imperative. The only question which exercised their minds was whether that consolidation should be effected during the last hours of the session, or whether it would not be better to post- pone it till there was ample time for experts to consider the whole matter, the importance of which he thought no one denied. Mr. Lloyd-George said that if the opposition did not object to the bill he would suggest that they should let it go to the House of Lords and there would be ample time before it came back to the House of Commons to consider wdiether they should proceed with it or not. If 54 PATENTS AND DESIGNS BILL. they sent both bills up to the House of Lords, then they would know the final form which would be assumed by the bill to wliich they had given a tliird reading that night and they would be in a better position to consider the question of consolidation. Mr. Forster (Kent, Sevenoaks) said that the opposition did not object to the consolidation bill, but what they wanted to know was whether there was an understanding that the patents and designs bill was to be included in the consolidation bill, and that if the latter was passed through the House of Commons it should be carefully reviewed before it actually became the law of the land. Under the bill which the house had just passed amending the patent laws various machin- ery proAdsions were set up, and he was not certain that all liis legal friends were satisfied that these would work smoothly. One of the objects in passing a consolidation bill was to save expense, and they would not do this unless the provisions of the bill were carefully considered. This they all hoped and believed would be satisfactorily done in another place, but the House of Commons at any rate would not be willing to accept the bill without further examination. All he wished was to have it recognized that when the bill came back it must of necessity be subjected to examination by the House of Commons. Mr. Claude Hay said that the president of the board of trade made a very proper statement when he said that the object of this bill was to insure that the poor inventor who was concerned in patents should have a cheap vade mecum of the law. The first function of the House of Commons was to have the first hand in framing legislation of this kind, but if they adopted the suggestion of the right honorable gentleman and took this bill in committee in the early hours of the morning because it was to be sent to another place, then it would be dealt with by the other house, with the result that the House of Com- mons would have lost control of the bill. He was quite sure that the committee would recognize the truth of that statement, because the House of Commons would only, under those circumstances, be able to deal with such amendments as the House of Lords might pass. Therefore it was a very serious thing to agree to the idea that the com- mittee stage of the bill should pass practically sub silentio, throwing the whole duty of considering the measure on another place. If any- thing went wrong in another place in respect of this bill, the burden would not rest on the House of Commons but on the other chamber. Being a member of the House of Commons he preferred that the re- sponsibility should rest on the House of Commons, and he thought they should do all they could to insure that the bill had an easy pas- sage through that house. He appealed to the right honorable gen- tleman to adjourn the consideration of the consolidation bill until the other chamber had had a full opportunity of considering and amending, with the full consent of the House of Commons, the patents and designs bill which had only a few moments ago passed its third reading. If the right honorable gentleman agreed to put back this measure for a time, every facility would be placed in his way of passing a fully matured consolidation bill through the House of Commons. Otherwise it would belike producing a cheap book — badly edited — and instead of making the law more intelligible to the inventor they would run the risk of making it more difficult to understand. The opposi- tion were taking a perfectly reasonable course in asking the right hon- PATENTS AND DESIGNS BILL. 55 orable gentleman to adopt this plan, and he was convinced that the best results would be secured if their suggestion was adopted. Mr. Cave said the consolidation bill had over 80 clauses, and the new bill had about 50. Everybody who understood the matter knew that the effect of the new bill would be to necessitate alterations in a great many clauses of the consolidation bill. Of course, any amendments actually made by the Lords in the consolidation bill would come before the Commons for consideration, but supposing the Lords omitted to alter the clauses of the consolidation bill which ought to be altered in order to give effect to the new bill, how could the Commons deal with that matter ? The House of Commons could only deal with amendments made by the other house, and could not insert new amendments after the bill had been returned from the other house. He did not know what machinery the Lords had for dealing with such complicated matters, or whether they were depend- ent on the private efforts of members, but in any case words might be omitted which ought to be inserted and this house would then be unable to insert them. Was it not possible to postpone the committee stage of the consolidated bill in this house until they got the amended patents bill back ? Then when they got that back and knew what the Lords' amendments were, they might in a few days put the proper clauses into the consolidation bill and go on with that bill. He was very much in favor of consolidation, but he was against consolidation in a hurry. Mr. Gordon said that in a measure like that there might be mistakes which honorable members might be able to point out. He was most anxious to see a consolidation bill. He would like to have the law consolidated. It would be in the interests of everyone concerned that it should be ; but he certainly thought it would be better to go slowly and let the bill which had been passed go up to the House of Lords and come back first. If that could not be done, they need only wait till next session, when a consolidation bill could go through without any w^aste of time or trouble. All he wanted was that if they were to have a consolidation bill, the bill should be of such character that it would carry out the object intended, and that was to have the law accurately stated in a compendious form. Question put, and agreed to. Remaining clauses agreed to. Bill reported without amendment, read the third time, and passed. [August 20, 1907, second reading.] Order of the day for second reading read. Lord Granard. The bill which I have the honor to introduce to your lordships' notice is, I fear, one of a very complicated and com- plex character, and I doubt whether I shall be able to explain it adequately. If I fail in that respect, however, there are many noble lords who are lawyers and are much better able to explain its provi- sions. The bill has for its object the remedying of the difficulties in the present law as regards patents and designs. It is well to remem- ber in discussing this bill what the origin of patents has been. As your lordships are aware, the Crown originally claimed a right of bestowing monopolies on certain industries and subjects, and when in later years, I think in the time of the Stuarts, it was abolished, 56 PATENTS AND DESIGNS BILL. monopolies were reserved for the purpose of bestowing them on in- ventors in order to encourage them to foster and create new inventions. That system worked well for a considerable time, but for some time past foreigners have been taking out patents in this country with no intention whatever of working them here. It may be of interest to your lordships to know how many patents have been taken out in this country and how many of those patents have been taken out by foreigners. During last year there were something like 14,700 orders, and of these 6,500 were granted to foreigners. In some industries this significant proportion is still more apparent. I would venture to draw your lordships' attention to the industries of dyes and saccharine. In the cases of dyes I think 95 per cent of the total patents were taken out by foreigners, and in the case of saccharine the number, I think, was something like 92 per cent. A lot of for- eigners take out these patents without any intention whatever of working them in this country, and under the bill which I have the honor of presenting to your lordships we hope to afford a remedy for this. We intend to ask a foreigner who takes out a patent and there- fore obtains a monopoly in this country to give us adequate reasons why he does not work the patent in this country, and, if he is unable to do so, we shall either insist upon his granting a compulsory license or in some way revoke his patent. There has been a certain amount of criticism on this clause, and it has been directed so far as I can make out on two points. One line of argument is that it savors of protection. I do not know how your lordships can agree with this argument, for it seems to me to be strongly in favor of free trade. At the present moment the man who works a patent in this country is certainly at a great disadvantage, for foreign patentees take out patents in this country with no intention of working them here. Surely it is fair to ask a foreigner who obtains a monopoly to give some adequate return for the monopoly the State grants him, and I do not think it is unfair in any way to ask him what we suggest in this bill. As your lordships are aware, in the bill which I think the board of trade brought in in 1902, the question of compulsory licenses was considered. It was hoped that by that bill compulsory licenses would be taken out, but, as a matter of fact, the result has not been at all satisfactory. The mode of procedure was very expensive. The appeal was to the privy council, and I understand that that is a tribunal very expensive to plead before. No poor inventor of any sort or kind would be able to pay the amount necessary. Under the present bill, we propose if possible to make this somewhat cheaper. The appeal will be to a single judge, and that single judge will be ap- pointed by the noble lord who sits on the Woolsack, and his decision will be final. Another section which has been to a certain extent talked about is section 24. Its object is to prevent unfair conditions and restric- tions being attached to the acquisition of patented articles. There has been a certain amount of ground for complaint in that respect, and it has especially been brought before us very forcibly in regard to the boot trade. They are bound in that trade to enter into agree- ments which they are forced to keep under which they may only use one particular machine, although many better machines may come out in the future. They are tied down to these original machines during the time their contract exists, and they are not allowed to use PATENTS AND DESIGNS BILL. 57 any other of any sort or kind. There are a great many other minor improvements in the law of patents. There is, I have pointed out, the simphfication of the patent laws, the cheapening of procethire, and the securing of a diminuition in the number of invalid orders. There is a provision for the revocation of patents and another provi- sion that a patent is not to be invalid by reason of an invention having been published which was not within the knowledge of the man who invented the patent. There are also provisions made as regards patent agents. There are, as your lordships' doubtless know, a certain number of what are known as registered patent agents, over whom the board of trade have absolute control, and the comptroller can refuse to deal with these people. As regards vmrecognized patent agents, he has no power whatever. Under the bill at present before 3^our lordships this is intended to be remedied, and the comptroller will be able to refuse to recognize unregistered patent agents who have been guilty of disgraceful professional conduct, and also to refuse to have anything to do with foreigners who have not a place of business in this country. The latter part of the bill deals completely with designs, and the. provisions of this part of the bill have been approved by the whole of the chambers of commerce. I do not know that there is very much more that it is necessary for me to say. Perhaps I might say that this bill has been welcomed in the House of Commons almost uni- versally. The colleague of the noble lord opposite, Mr. Bonar Law, who was at the board of trade with him, made, if I remember right, one great complaint against the Government. He said that while all his colleagues had ample opportunity of criticizing measures of the Government, he was in the unfortunate position of always having to agree with the measures brought forward by my right honorable friend the president of the board of trade. I only hope that the noble marquis, whose colleague Mr. Bonar Law^ was at the board of trade, may take the same view and give this bill a favorable considera- tion on second reading. Moved, ''That the bill be now read 2^" The Marquis of Salisbury. I am afraid I owe your lordships a very humble apology for once more presenting myself to address you. I do so upon a very much less exciting topic, but one which is not less important in its character. I can onlv promise I will be very short. The nobis earl who has explained this bill has expressed the hope that the amicable relations which subsist between the repre- sentatives of the board of trade and the ex-representatives of the board of trade in the House of Commons will be found to be true in this house also. I do not think he has reason to complain of my atti- tude during the last two years in respect of board of trade business, and, as regards this bill, there is no reason why there should be any great difference of opinion between us. On its principle and on most of its details I think it will be found that no great difference of opinion exists in your lordships' house, but I am bound to say that I think the way in which this bill has been presented to the house does call for comment, and, indeed, for serious complaint. I ask your lord- ships, Is it a proper thing to present for the first time to the House of Lords a bill of this enormous importance upon the 20th of August at II o'clock at night? This bill with all its merits, is a bill of detail, and any matters of dispute in it are all matters of detail which under 58 PATENTS AND DESIGNS BILL. happier circumstances would be far better discussed in your lord- sliips' house than anywhere else, because in your lordships' house are contained men of great experience, both in industrial matters and in matters of law, men whose equal, with al] respect to the House of Commons, are not to be found in that branch of the legislature. I think that it is almost wanton, if I may use such a phrase, of His Majesty's Government to use the House of Lords so badly in respect of this most important bill. There is no really no reason in the world why the bill should not have been brought before us at an earlier period of the session. Why was it not introduced in your lordships' house ? That would have been an easy and proper method. I am sure if it had been introduced in your lordships' house in the earlier part of the session, it would have been sent to a select committee which would have thrashed out its details, brought to bear upon it first-class knowledge, and turned out a first-class bill. But as it is^ what are we to do ? I look around. One or two legal luminaries are still here, but where, for example, is the Lord Chief Justice ? He is known to be a great authority on patent law. He is not here. Where is Lord Coleridge ? He is not here. He was always introduc- ing a patent bill when I was in the House of Commons. The same thing may be said of those who are engaged in industry. Where is Lord Avebury ? He is on the associated chambers of commerce and on the board of trade advisory committee. He is not to be found. Discussion in your lordships' house under these circumstances is nothing less than a farce, and is not deserving of the name of a real discussion by a legislative assembly. I have made my protest, and I earnestly hope the members of the Government who sit in your lord- ships' house, and who, I am sure, can not approve of such treatment, will exercise their influence on the Government next year and see that bills of this kind, which are preeminently those which ought to be introduced here, are introduced here at an earlier part of the session. I do not propose on the present occasion to say much as regards the bill itself. There are considerable difficulties which I think ought to be explained when we get into committee. I will only enumerate them more for the purpose of giving notice of the kind of thing which ought to be discussed in committee than with the view of dwelling upon them. There is, for example, the question under clause 3, which makes it incumbent under certain circumstances upon an inventor of chemicals who seeks a patent to produce samples of his work. It is alleged that that will press very hardly upon the poor inventor who very often has not access to the machinery to produce a sample. There is a question in clause 4 as to cognate orders — a most difficult and intricate matter. It is alleged that great confusion may arise in respect of the fact that your cognate patent is antedated to the same date as the original patent. Then there is the more important clause, clause 7. The noble earl knows that that is a question which excites a good deal of feeling. Under clause 7 the comptroller, in the first instance, at any rate, has power to refuse the patent altogether if he thinks it has been completely anticipated. Hitherto, if a man has taken a patent out under those circumstances, he has taken it out at his own risk, and no one has had the right to stop him altogether. When the proper time comes I shall be prepared, I think, to explain to your lordships how it is that such a change in the law may act with considerable hardship upon inventors, but I will content myself for PATENTS AND DESIGNS BILL. 50 the moment with saying that a very important document was, I think, prepared and presented to the board of trade, signed by an enormous number of persons of great importance in the world of invention, inckiding a most eminent member of your lordships' house — Lord Kelvin — which protested against the conditions of clause 7. Then there is the question of the single judge. I quite agree for my own part that there is a great deal to be said for referring these ques- tions to a single judge, but there seems to be a necessity that there should be some means when we reach important and intricate matters of patent law, to refer the decision to a higher court of appeal. I shall be very glad as regards the other clauses of the bill, when we come to them, if the noble earl is able to explain upon what prin- ciple the words "exclusively or mainly manufactured in this country" will be interpreted. I am not opposed to the principle of this clause, but I think some of the words are so vague that they will give rise to very expensive litigation. I should also like to ask in connection with that clause what are the positions of foreign treaties which are referred to in the latter part — whether in foreign treaties, w^hich, of course, are very much complicated by the existence of the most- favored-nation clause, it will be possible for this clause to operate at / all. I may just say one word as to compulsory licenses, and it shall only be one word. The noble lord said that the section in the act of 1902 had failed. He was quite right in that observation, but I would call to his notice the fact that it failed because of the ex- pense and the expense alone. It does not, however, follow that because the clause in the act of 1902 failed, the principle of com- pulsory licenses is a bad principle. I am glad, therefore, to find that the principle still appears in the bill, although the tribunal is no longer the privy council but a single judge. There only remains one word to be said in regard to clause 24. That clause is a very novel clause. I do not deny that the argument the noble earl used just now has a great deal in it. I am not at all prepared to say that the Nation has not the right, in return for the monopoly which it grants, to impose certain conditions upon the use of that monopoly. That appears to me perfectly defensible in theory, and, indeed, it may be defensible in practice, too. But I think we ought, before we part with that clause in committee, to have some account of the reasons which have led the Government to put it in the bill. Until I have heard those reasons I should like to reserve my opinion as to whether the clause deserves the complete support of your lordships' house. It will be seen from the observations I have ventured to make that none of the objections to' which I have called attention are objections of principle. They are all matters of detail, and if I have detained your lordships for a few moments, it is for the purpose of giving notice to my noble friend of those matters which seem likely to arise when we get into committee and not for the pur- pose of stopping the passage of the bill. The Lord Privy Seal (The Marquis of Ripon). I must admit that the noble lord has some cause of complaint. All I can say is that the bill was very carefully considered in the other house. I believe it was six weeks in grand committee. That is one of the reasons why it comes up to us so late. I have alw^ays been very pes- simistic, whether I sat on this side or on the other side of the house, with reference to the dates on which bills come up to this house. 60 PATENTS AND DESIGNS RILL. If the bill, however, be late here, there is no doubt that the noble marquis thoroughly understands it, and that he will be prepared when we get into committee to make any observations he desires. I am quite sure my noble friend behind me will be equally ready to make a reply. The bill is a very important one, and it does deserve good consideration. I regret that a bill of this kind should have come up at this period of the session, but it is not the first occasion on which things of this sort have happened, and I am afraid it is not likelv to be the last. Viscount St. Aldwyn. It is very difficult to say much after the generous apology the noble marquis has made, but, as a past presi- dent of the board of trade, I would venture to sav this much in addi- tion to what he has said as to whether a way might have been found out of the difficulty. This is not a party measure, and it is a bill the details of which can really be discussed only by experts such as lawyers or gentlemen concerned in some industrial occupation. It is a bill which, of all others, I should have thought, speaking with some little officieJ acquaintance of the subject, might have been introduced in your lordships' house earlier in the session. I hope the noble marquis opposite will, at any rate, use his influence next year to see that something of the kind will be done as regards meas- ures of a similar character to the present bill. On question, motion agreed to. Bill read 2^, and committed to a committee of the whole house on Friday next. [Lords, August 23, 1907.] House in committee (according to order). Clauses 1 to 6 agreed to. Clause 7 : The Marquis of Salisbury, in moving to omit clause 7, said the proposal in this clause was a perfectly new one, which had never yet found its way into patent legislation. Under it the comptroller, who, though an admirable official of the board of trade, was not a judicial officer in any sense of the word, had a right to stop abso- lutely an application for a patent if he thought it had been wholly anticipated. As a matter of fact, there was no more difficult issue to try as whether a patent had been wholly anticipated. The experience of the courts showed in case after case and time after time that patents which had the appearance of having been wholly anticipated, so far from having been in fact anticipated had been sustained by the high- est courts, and had been of the greatest use to the community and to the industries of the country. At a more congenial period he could have gone into that subject at great length; but he might mention one case in order to illustrate his meaning to their lordships. A patent was applied for which had for its object the disinfecting of clothes by means of superheated steam. When the specification was looked at that patent appeared to have been completely and absolutely anticipated by a former patent. The one which it was alleged antici- pated it was a complete and disastrous failure, for the reason that when the pressure of steam was put on the machine it burst,, and therefore it did not succeed. As far as the description of the patent was concerned, the new patent was precisely the same as the old, only in this case when the pressure of steam was put on it did not PATENTS AND DESIGNS BILL. 61 burst, and the result was just the difference between compkHe failure and complete success. It would have been exceedingly difficult to have told that beforehand upon the terms of the specification; but when the case came to be tried by the superior courts after the new patent had been in use for some time, the patent was sustained. He only mentioned that in order to illustrate that the issue of whether a patent had been anticipated or not was a most difficult one, and was not one which ought to be intrusted to the comptroller of his own motion to interpret and decide upon. This clause had attracted a great deal of attention. It was not in the original bill of His Majesty's Government, but it was put in in grand committee of the House of Commons. A letter had been written to the Times pro- testing in the warmest way against it, and signed by a large number of gentlemen, including Lord Kelvin, Sir Douglas Fox, Prof. Silvanus Thompson, and many other eminent men who had great experience of inventions and patents. And, lastly, the London Chamber of Commerce had communicated with him through their representative, begging him to use his best endeavors to induce their lordships to prevent the passing of this clause. He need not remind their lord- ships that the London Chamber of Commerce was a very important body, and that they had a special connection with patents, and upon the strength of their suggestion he had ventured to place this amend- ment before their lordships. No ultimate injustice would be done, even if the clause were struck out, because the granting of the patent afterwards could be opposed, if it was desired to oppose it, on behalf of any aggrieved party. That was not touched by this clause, nor was the right to have a patent revoked hereafter if the aggrieved party desired to have it revoked. The object of the amendment was only to prevent the comptroller taking the tremendous responsibility of stopping on his own motion the granting of a patent. Amendment moved — To leave out clause 7. — (The Marquis of Salisbury.) The Lord Chancellor. I feel confident that if the noble marquis had been in the habit of considering patents and specifications, he would not have lent his ear to those who oppose this clause. Patents are monopolies granted by the State in order to benefit those who are real inventors; but there is a class of patents taken out which are show patents, and to which I refrain from attaching a still more serious epithet. They are patents which have been partly anticipated; they are not new at all, but previous specifications have, in the words of this clause, "wholly and specifically" claimed them. But there are poor people who can not aTord to fight those who have got a patent; and the consequence is that by means of these bogus patents those people who obtain them frighten those who are poor and who can not contest with them in courts of law, and thereby they require them to take out licenses and make some sort of payment rather than have a litigation. That is the plain fact. One of the purposes of this bill is to put an end to practices which I will not stigmatize fur- ther than I have already described them — and I think that is a most meritorious object. This is what the clause says: Provided, That the comptroller, if satisfied that the invention claimed has been wholly claimed or described in any specification to which the investigation has ex- tended may, in lieu of requiring references to be made in the applicant's specification as aforesaid, refuse to grant a patent. 62 PATENTS AND DESIGNS BILL. The noble marquis is quite mistaken if he thinks there is much difficulty about that. The Marquis of Salisbury. I think there is. The Lord Chancellor. I have had a great deal to do with speci- fications, and I do not think there is any difficulty in deciding whether there is ground for saying that an invention has been previously claimed. The whole thing is set out in print; you can see it at any time. But let me tell this to the noble marquis: The comptroller, himself a skilled offixial, has had the power of refusing patents since 1883 in cases where there has been opposition, and there is an appeal to the law officer. It is not the comptroller alone, but there is an appeal to the law officer. I venture to think that nothing can be more desirable than to give an opportunity, in such obvious cases as these, of preventing what is really altogether an abuse of the sys- tem of patents for the sake of profit, and which has been a source of real complaint on the part of the trading classes. The Marquis of Salisbury said that, having been a law officer, no doubt the noble and learned lord knew as well as he did that in any case where a patent was alleged to have been anticipated, and the comptroller thought so, the patentee had to put on his own speci- fication, in black and white, the other patents which were said to anticipate his, so as to give such notice to the public as to enable them to resist an unfair patent. That was under the act of 1892. The noble and learned lord had also forgotten to remind their lordships that unless he was very much mistaken — he spoke under correction — in the report of the royal commission on this subject, on which the Lord Chief Justice sat, as well as other persons of great eminence on these subjects — Lord Justice Fletcher Moulton amongst others — it was definitely recommended that this power should not be given; and there was a specific recommendation of that committee upon which the act of 1892 was founded. The house had not had a real opportunity of dealing with this bill. He had cut down his observa- tions to a minimum; but the bill was presented to their lordships' house on August 22 with these new principles introduced. It ought to have come to their lordships earlier in the session, and to have been sent to a select committee. That would have been the proper pro- ceeding, and he thought their lordships were entitled to insist that a totally new clause should not be put into an act of Parfiament, to the Erejudice of every great interests and in the teeth of a protest signed y such influential persons as he had mentioned, and by the cham- ber of commerce, without some better opportunity for consideration than had been afforded. If His Majesty's Government had treated their lordship's house properly, and had sent the bill in in proper time, it would then have been sent to a select committee; and not only would he not then have resisted it, but he would not even have dared to raise his voice, because then there would have been the Lord Chief Justice, Lord Avebury, Lord Collins, and others who knew very much more about the matter than he did, who at present were away on their holidays and therefore not able to take part in this discussion. He thought His Majesty's Government ought to give way. The Lord Chancellor. I hope I have not said anything that can legitimately cause pain to the noble marquis. The Marquis of Salisbury. Not at all. PATENTS AND DESIGNS BILL. 63 The Lord Chancellor. The noble marquis has said that this bill ought to have come before your lordships' house before. We all wish it had; and we all know the causes why it has not. I have had occasion to say before that until you alter the causes you will never be quite certain of being able to prevent these things happening. In regard to what the noble marquis has said about the recommen- dation of the committee, that is quite true. They thought the prac- tice would be stopped by an additional sealing fee being put on. It has turned out, however, that the additional sealing fee has not had the effect of stopping these sham patents. In regard to the point about notice of previous patents, all that the noble marquis says is perfectly true; but that has not prevented the abuses — because the point is that you have got a patent and, whatever the patent is, you prevent or terrorize poor people from using the old invention unless they are prepared to come to terms with you. The thing is wrong on the face of it ; and no one has ever denied that the practice is carried on. I am quite satisfied that this is a fair thing to do, and I hope the noble marquis will not press his amendment. On question, amendment negatived. Clause 7 agreed to. Clauses 8 and 9 agreed to. Clause 10: The Earl of Granard. There are several amendments standing in my name on this clause, but they are simply drafting amendments rendered necessary in consequence of some inadvertence on the report stage of the bill. The Marquis of Salisbury. Why does the noble earl strike out '' wholly and specifically" in line 31 ? The Earl of Granard. In answer to the noble marquis, if "wholly and specifically" were allowed to remain in the clause, instead of widening its operation it would curtail it. I can give an example. If these words were allowed to remain it would not be possible for anybody to object to any part of an invention being taken. Drafting amendments agreed to. Clause 10, as amended, agreed to. Clauses 11 to 14 agreed to. Clause 15: The Earl of Granard. As the clause stands at present, it will not come into operation until the expiration of a year from the com- mencement of this act; that is to say, not until January 1, 1909. The intention of this amendment is that it should come into operation at the end of 12 months after the passing of the bill. I may mention that the word '^ commencement" was accepted inadvertently in the House of Commons on the report stage. Amendment moved — In page 6, line 23,' to leave out from the word '' patent" to the word "of," in line 26, and insert the words "and not less than one year after the passing." — (The Earl of Granard.) The Marquis of Salisbury said that there was a difference of opinion between the noble earl and himself as to the opening words of this amendment as it stood, whether clause 15 should apply to the question of patents granted before the commencement of this act. He did not feel that their lordships would care that he should raise that point at that hour of the night in a house not very numerously 64 • PATENTS AND DESIGNS BILL. attended. It was a very important point, and, personally, he was very much astonished that His Majesty's Government had lent themselves to limiting the rights of the persons who had got their patents before the passage of this act. It was a very strong measure; but he would not attempt to contest it at the present moment. On question, amendment agreed to. Drafting amendments agreed to. Clause 15, as amended, agreed to. Clauses 16 to 22 agreed to. Clause 23 : The Earl of Granard. I beg to move to leave out the words ''did not arise from any misconduct on the part of the patentee," and to insert the words 'Hhat no undue delay has occurred in making the application." We are of opinion that it is very improbable that omission would arise from any misconduct on the part of the patentee, and that what really should disqualify the application from obtaining restoration of the patent is undue delay in applying for such resto- ration. Amendment moved — In page 10, lines 4 and 5, to leave out the words "did not arise from any misconduct on the part of the patentee," and to insert" the words "that no undue delay has occurred in making the application." — (The Earl of Granard.) The Marquis of Salisbury. Who judges? The comptroller? The Earl of Granard. The comptroller; yes. On question, amendment agreed to. Clause 23, as amended, agreed to. Clause 24 : Drafting amendment agreed to. The Lord Chancellor. The next amendment is one that I move and it arises in this way. There is a provision that certain conditions to the sale of patented articles shall not be valid. I will tell your lordships exactly the sort of thing that happens. People who live abroad, and take out patents in this country, do not work them in this country, but manufacture the patented articles in, say, America or anywhere they please, and then they sell the right to use the patent here, and they affix conditions — for instance, conditions that all the machinery for the purpose of making the patented articles shall be bought from them in America, and all sorts of other conditions of an oppressive kind. Thereby they use the patent, not merely for the legitimate protection of themselves, but for the purpose of either preventing people in the United Kingdom from making the patented articles, or of attaching all kinds of irrelevant and oppressive condi- tions to the permission to make them. That is thought to be unfair; and the consequence is that certain conditions are proscribed here, as, for example, to require the purchaser or the licensee to acquire from the seller or the licensor any article or articles not protected by the patent. I have just given an illustration of that with regard to buying machinery. Still it is necessary to keep as much freedom as is consistent with preventing abuse of the patent; and accordingly we propose, in accordance with a sort of undertaking given in the House of Commons, that this subsection shall not apply if the seller, lessor, or licensor proves that at the time the contract was entered into the purchaser, lessee, or licensee had the option of purchasing the article or obtaining a lease or license on reasonable terms without PATENTS AND DESIGNS BJU^. 65 such conditions, and also that the contract entitles him to relieve himself of the liability to observe any such condition on giving notice and paying compensation. That seems to be the best and fairest way of enabling reasonable conditions to be made, or enabling prac- tically any conditions to be made, provided there is a free opportunity for each party to contract. It is a technical and somewhat difficult matter — ^but the object is to prevent the imposition of these abso- lutely preposterous conditions by persons who sell from abroad — or indeed in this country also — patented articles. Amendment moved — In line 30, after the word "policy," to insert the words "Provided, That this subsec- tion shall not apply if (i) the seller, lessor, or licensor proves that at the time the con-- tract was entered into the purchaser, lessee, or licensee had the option of purchasing the article or obtaining a lease or license on reasonable terms, without such conditions as aforesaid; and (ii) the contract entitles the purchaser, lessee, or licensee to relieve himself of his liability to observe any such condition on giving the other party three months' notice in writing and on payment in compensation for such relief in the case of a purchase, of such reasonable sum, or in the case of a lease or license of such rea- sonable rent on royalty for the residue of the term of the contract, as may be fixed by an arbitrator appointed by the board of trade." — (The Lord Chancellor.) The Marquis of Salisbury said he certainly did not rise in any way to contest the principle of this clause, but he thought the clause as it stood in the bill went much too far. However, the amendment pro- posed by His Majesty's Government was certainly a considerable concession. He wanted to be as brief as possible, but there were two points to which he would like to call the noble and learned lord's attention. In the first place, there was the compensation mentioned in the second subsection. That compensation was said to be '^such reasonable sum or such reasonable rent or royalty" — so that the word '^ reasonable" was attached to ''compensation." If the noble and learned lord would look at the second subsection, the correspond- ing compensation had no such word as '^ reasonable" sum attached to it. Then, in the case of contracts made before the passing of this act where the terms of the contract could be broken in return for com- pensation, the word appeared alone without the word ''reasonable." Here, again, he considerably felt at a loss in discussing the matter with the noble and learned lord, but he suggested to him that anybody seeing the section when it passed into an act of Parliament would have their attention at once drawn to the point that the ''compensation" mentioned in the first subsection was differently worded from the "compensation" mentioned in the second and third subsections. The Lord Chancellor. I do not mind leaving out the word "reasonable"; I think that will cover it. The Marquis of Salisbury was obliged to the noble and learned lord, but were they to understand that the word "compensation" in this connection meant the full amount which the person who received the compensation had lost by the operation of the clause ? It Avas not, he presumed, compensation such as might be thought sufficient by the official of the board of trade whose business it was to make the act work but not to care so very much about justice to the parties. He did not mean to say that there were such persons at the board of trade, but it was a conceivable case. The compensa- tion he wanted was full compensation corresponding to the loss to the individual whose contract was broken. Would he get the full value ? He had a contract; the contract was broken; he lost by it; would the 40296—12 5 66 PATEI^TS AND DESIGNS BILL. compensation correspond, so far as human ingenuity could make it^ to his loss ? The Lord Chancellor. I will omit the word '^reasonable" in both places. I do not think it either adds to or detracts from the value of the clause. With regard to the question which the noble marquis put, he touched upon a very difficult subject, the measure of damages. What I think would be given would be what the arbi- trator thinks, under the circumstances, it is fair to give, remembering what it is given for, namely, a man reheving himself of an obligation; he would have to compensate the other person whatever is fair. The Marquis of Salisbury. The same sort of damages as a jury would give ? The Lord Chancellor. Very much the same thing. In fixing damages, in nearly all cases you must consider what is reasonable, right, and fair, and in this case you would have to compensate this person for the alteration in his position in consequence of notice having been given. That is the way it would be put to himself by the arbitrator; and I think it would be very difficult to go nearer to it. There is nothing that I know, either in the wording or the inten- tion, to make any unfair limit. The Marquis of Salisbury. I think I must be satisfied with that. I should not have asked the noble and learned lord the ques- tion but that there had been an observation by one of his colleagues in another place which led people to doubt what ''full compensation" was intended to cover. The Lord Chancellor. Those words were not before him. The Marquis of Salisbury said he could absolutely rely on what the noble and learned lord had told him. There was just one other ques- tion he wanted to put with reference to the word "and.'^ This was a much more important question. Should not the word be "or"? He thought they were entitled to some consideration from His Majesty's Government. After all, this was the case of two men wishing to make a contract; the two persons were perfectly free agents. It was not like the oppression by a rich man of a poor man, but it was a case of dealings between two business men, each of whom was perfectly capable of making a bargain. It was said that not- withstanding that hard terms were inserted. They could see that hard terms might be inserted in such a contract, and they accepted the principle of the Government clause, but if it could be shown that there was a reasonable alternative given to these hard terms, then this restrictive clause should not apply. What were reasonable terms ? Surely, if the seller could prove that the man with whom he was dealing could, in the alternative of those terms, have bought in the open market freely, that ought to be quite sufficient; or, if he could, on the other hand, show that he had offered the purchaser an arrangement which did not involve these restrictive terms, that ought to be perfectly sufficient. But why couple them both together? Why make the double condition? Surely, it w^as quite sufficient in the case of business men, who were perfectly able to make a bar- gain between themselves, to go as far as he had described, and to allow either of the alternatives. He begged to move, as an amend- ment to the amendment, to leave out the word "and" and insert the word "or." PATENTS AND DESIGNS BILL. 67 Amendment moved to the proposed amendment — To leave out the word "and," at the end of subsection (i), and to insert the word "or." — (The Marquis of Salisbury.) The Lord Chancellor. I think if the noble marquis will just look at the clause he will see that he can not maintain that. He begins by admitting that there may be cases — in fact, everj^body knows there are numerous cases — in which these oppressive and imfair conditions are imposed upon persons who are not offered a fair alternative. If that is the case, would it be sufficient to say that that still may be imposed upon a person who is not offered a fair alternative if he is unable to get out of it by paying compensation? That is the effect of the noble lord's amendment, because either the first or the second limb of my proposed words would suffice to exclude the effect of the section. It is necessary, to my mind, in order to prevent the subsection applying, that there should be, in the first place, proof that the man could have got a license on fair terms and, secondly, might have got out of it upon giving notice and paying com- pensation; and, if you say that he may still be oppressed if he got out of it by paying compensation, you put him to this alternative — that he is either to pay compensation in any event, or to pay com- pensation for getting out of what is unfair. That can not be right. On question, original amendment agreed to, with the omission of the word "reasonable'' in lines 3 and 4. Drafting amendment agreed to. Lord Balfour of Burleigh, who had an amendment in page 11, line 23, after the word "from" to insert the words "buying or," said that he did not desire to move the amendment, because an amendment inserted by the noble lord in charge of the bill met his point. Drafting amendments agreed to. Clause 24, as amended, agreed to. Clauses 25 and 26 agreed to. Clause 27, with drafting amendment, agreed to. Clause 28: The Marquis of Salisbury, in moving to insert a proviso giving leave to appeal under certain conditions, said that he had been in communication with the lord chancellor upon this point, but, unfor- tunately, owing to the demands upon his lordship's time, they were not able to bring their conversation to a conclusion. He had there- fore put the amendment upon the paper, but he would not press it if the noble lord did not wish him to do so. He thought, considering the enormous importance of the issues involved, and the very large sums of money in question, there ought to be some possibility of bring- ing these cases to the superior courts if the court of appeal should think it right. He knew that in all cases of revocation there was an appeal granted now, but there were cases which did not involve revocation but yet were very important, as, for example, the case of a petition under clause 16 with regard to a compulsory license. That might be a decision of very great importance. He would say nothing more, except that if the noble and learned lord was willing to accept his amendment he would take it on any terms he liked. It was a matter much more for the noble and learned lord than for himself. 68 PATENTS AND DESIGNS BILL. Amendnieiits moved — In page 12, line 35, after the word "and" to insert the words "save as hereinafter provided." In line 39, after the word "opposed" to insert the words "unless the court of ap- peal shall give leave to appeal upon such condition as to costs or otherwise as they shall think just: Provided, That in considering any application for leave to appeal the court of appeal shall have regard to the interests involved in the proceedings and the finan- cial position of the parties thereto." — (The Marquis of Salisbury.) The Lord Chancellor. This is one of the sort of points on which I wish, so to speak, both ways. In appeals, you have always got to consider, in the first place, that it is very hard if the decision of one judge produces unfairness or injustice. On the other hand, you have to remember that the rich man can kill the poor man by constant appeal. It is extremely difficult to draw the line between the two. I am quite certain that the noble marquis and I have exactly the same purpose in view. Will he just look and see what things are un- appealable — I mean unappealable to the court ? In the first place, decisions of the comptroller under clause 15 — that is, for the revoca- tion of patents outside the United Kingdom — when a man takes out a patent outside England and never works it in England, but merely uses it to prevent industry in England. There is no appeal if it is proved that the patent ought to be revoked for not being worked outside the United Kingdom; and I think that is a fair issue enough to leave to the one judge. The Marquis of Salisbury thought there was an appeal under that, because it involved revocation. The Lord Chancellor. The only appeals in which decisions would be final would be, in the first place, decisions under the comp- troller. They would not be appealable. The next are decisions under clause 16, where the judge gives a compulsory license on the ground that the patentee takes out his patent in this country and works it wholly abroad, and will not allow anybody to work it in England at all — which is a usual rule. We give the judge power to say: "You shall allow it to be worked in this country; it is an English patent, and we will not allow you to use it for the purpose of pre- venting British industry." There is no appeal against that, and I do not see that there is anything very hard in such a case. The next is the decision of the juage under clause 17. Clause 17 i? a clause for merely extending the term of a patent from 14 years to some- thing further. Theie is no appeal against that, aiid there is no apr peal against the decision of the comptroller (and this is the last, I am glad to say) under clause 23; that is, in regard to lapsed patents being restored. After all, they are not really fighting points as to whether there has been infringement of the patent. It is only those four points which are unappealable. I will not say we are abso- lutely right, but it seems to me not unreasonable to say finis litem at an early stage. The Marquis of Salisbury thought that the noble and learned lord — if he might say so with respect — put the point not quite fairly. It was quite true that it was in the eyes of a true-born Britisher an outrage that a patent could not be worked in England, but that was not the appeal which would go to the appeal court. Somebody would have to decide what was the interpretation of being ''wholly or mainly manufactured in the United Kingdom." That must be a PATENTS AND DESIGNS BILL. 69 matter of the most immense intricacy — indeed, lie could not attach any meaning at all to the word "mainly," but then he was not a lawyer. He could not conceive how it would be interpreted. It might be said that '^mainly" meant that of all the articles in (|uestion the majority were made outside the United Kingdom. If that was the meaning of ''mainly/' then the clause would work a great hard- ship; but if it meant that of the supply in England the larger num- ber had been made abroad, that would not be so bad. But it seemed to him a word of the vaguest possible kind, and likely to lead to any amount of litigation. Taking clause 16, he found that somebody would have to interpret what the words "manufactured to aii ade- quate extent " meant. Was not that a wonderful word for an act of Parliament? "WTio in the world knew what an "adequate extent " could be? And, again, there was the expression "suj:>ply on reasonable terms." He did not want to insist, but he did not think the noble and learned lord ought to import any prejudice from the kind of subject which these clauses dealt with. No doubt they were designed to prevent injustice to British subjects, but that was no reason why they should put in an act of Parliament very vague terms and then not allow any appeal to a proper tribunal to say what they meant. The Lord Chancellor. I do not deny that there may be cases of hardship arising upon this or upon an}^ other clause in any other act of Parliament. It is a choice of evils — whether you will protract litigation or whether you will risk error now and then. I think we must draw the line somewhere. The Marquis of Salisbury. I do not press it. Amendment, by leave, withdrawn. Clauses 31 to 33 agreed to. Clause 34, with consequential amendment, agreed to. Clauses 35 to 43 agreed to. Clause 44, with consequential amendment, agreed to. Clause 45 agreed to. Clause 46, with drafting amendment, agreed to. Clauses 47 to 49 agreed to. After clause 49 : The Lord Chancellor. I move to insert a new clause, which is only for the purpose of applying to Scotland the expression "rules of the supreme court." It appears that my countrymen in Scot- land have not been as diligent as they are reputed to be, and your lordships may be able to make them work, I hope, by putting in that this refers to Scotland. Amendment moved — To insert the following new clause: "The expression 'rules of the supreme court' shall in this act (except in sec. 28) as applying to Scotland mean act of sederunt; and notwithstanding anything contained in the patents, designs, and trade-marks acts, 1883 to 1902, or in this act, the expression 'court' in sections 16 and 17 of this act shall, in reference to proceedings in Scotland thereunder, mean any lord ordinary of the court of session. "^ — (The Lord Chancellor.) Lord Balfour of Burleigh said the amendment sounded quite reasonable, but they would look at it when it was in print. The Lord Chancellor. Before I put this clause the noble lord has handed in an amendment to clause 48, relating to the Isle of Man. I will put that first. On question, amendment agreed to. 70 PATENTS AND DESIGNS BILL. On question, new clause after clause 49 agreed to. Clause 50, with drafting amendment, agreed to. In the schedule: Drafting amendment agreed to. Standing committee negatived. The report of amendments to be received on Monday next, and bill to be printed as amended. [No. 211.] PATENTS AND DESIGNS (CONSOLIDATION BILL.) House in committee (according to order) . The Earl of Granard. My lords, I do not know whether it will be convenient to the house to move these amendments altogether. They are all in conformity with the existing law. Would that meet with the wishes of noble lords opposite ? The Marquis of Salisbury said that, having regard to the way in which business was done, he did not think it mattered much. Amendments moved en bloc, and agreed to. Standing committee negatived. The report of amendments to be received on Monday next. [Commons, August 26, 1907.] Amendments reported (according to order). The lord chancellor said there was a misprint in the bill, the word ^'reasonable" occurring twice. He did not think it was necessary to do more than to tell the house, so that with the authority of the house they might have it corrected. Then (standing order No. XXXIX having been suspended) bill read 3^ and passed, and returned to the Commons. Amendments reported (according to order) . The Marquess of Salisbury said that this was a yet further example of the remarkable manner in which business was done in respect of this patents bill. One of the invariable rules in respect of consoli- dation bills was that they should be sent to be considered by a select committee; but this consolidation bill, involving matters of tre- mendous importance and interest, had never been considered by a select committee either of their lordships' house or of the House of Commons. It had been pushed through in a hocus-pocus manner, and amendments without the least possible kind of supervision were to be stuck in at the last moment altogether. He presumed that was the manner in which the Government put the amendments. He advised them to do so because there was no time to do it otherwise, but he desired to enter his protest against the manner in which the bill was being carried through. The Lord Chancellor. Will your lordships allow me to point out that I think the noble marquess on this occasion is a little mis- taken ? I do not think it is the case that every consolidation bill should go to a committee. On the contrary, consolidation bills are always treated in a quite exceptional way. They are taken on the faith of the officers and parliamentary draftsmen, and the minister is expected to see that they have been carefully considered, but, being consolidation bills, they do not affect more than the putting together of things Parliament has obviously already agreed to. That course has been adopted in regard to this bill. I will not deny, PATENTS AND DESIGNS BILL. 71 if the noble marquess insists, that he is riglit al)()ut the select com- mittee. The Marquess of Salisbury. I only spoke according to the infor- mation that has been given me. I can not pretend to liave first-lumd knowledge of the subject. The Lord Chancellor. I will not aflirm any more than the noble marquess. Now let me explain what this bill is. It is proposed now to bring the bill which your lordships have just read a second time, and w^hich was amended in committee, into the consolidation bill, and there is not a single novel point in the whole bill. I have felt it my duty to inquire Avhether everything proper has been done. The parliamentary draftsmen have been carefully through the amend- ments to see that they are correct. They have also been checked by the clerks in the parliamentary oflice, and they have been examined by two of the comptroller's examiners. The bill is purely a consoli- dation bill, and I hope under these circumstances we shall be allowed to have a third reading. Amendments moved en bloc, and agreed to. Then (standing order No. XXXIX having been suspended), bill read 3^, with the amendments, and passed, and returned to the Commons. [Lords, August 27, 1907.] Lords amendments considered. The president of the board of trade (Mr. Lloyd-George, Carnarvon Burghs) said that most of these amendments were purely drafting amendments, and there were one or two of substance, but they were amendments which carried out things which he himself had promised before the bill had left that house. Lords amendments agreed to. Lords amendments considered. Mr. Lloyd -George said the amendments were considerable in num- ber and would take a long time to read. He would suggest, therefore, that they should be taken by the house en bloc. They had been most carefully considered and the Government were prepared to accept them. Lord Balcarres (Lancashire, Chorley) said he had not the slightest intention of opposing the right honorable gentleman's suggestion to take the mendments en bloc. He thought, however, upon the question that the amendments be considered he might be permitted to make some observations upon the methods which had been adopted by the Government to pass this bill. The house would recollect that w^ien they had finished passing the patents bill proper at between 2 and 3 o'clock in the morning the consolidation bill was brought before them and passed, 20 clauses being taken at a time. They did not object to the bill going through, but they pointed out that the consolidation bill was one which ought to be considered b}^ a select committee. That course, however, was not followed, 3^et had the bill been introduced earlier in the session, as it ought to have been, it could then have been fully and properly considered by a committee. As it was, however, the House of Lords, having passed the patents bill, were called upon two or three minutes later to consider a con- solidation bill. There also, in that house, the bill was not going through the proper ordeal of a select committee, but the lords had 72 PATENTS AND DESIGNS BILL. a^Cn-^u^ placed in it, he would not like to say how many, amendments, all of which had been agreed to in a very few minutes. However, he was quite prepared to accept the right honorable gentleman's statement that these amendments had been carefully considered by the Govern- ment, and he did not propose to object to their being taken en bloc, but at the same time he felt bound to point out that in neither house had the bill passed through stages through which it was desirable that such bills should pass. Lords amendments agreed to. [Commons, April 18, 1907.] Mr. MoND (Chester) . I beg to ask the president of the board of trade whether he can state whether clause 10 of the bill to amend the law relating to patents and designs is at variance with any treaty, agree- ment, or engagement with any foreign country or British possession; and, if so, what foreign countries or British possessions. Mr. Lloyd-George. I am advised that the provisions of the clause would not be at variance with any existing treaty, agreement, or arrangement. [Commons, April 15, 1907.] Lord R. Cecil (Marylebone, E.), I beg to ask the president of the board of trade whether he will cause to be printed and circulated, before the second reading of the patents bill, a memorandum, similar to the memoranda circulated on other Government bills this session, showing its effect on existing legislation. Mr. Lloyd-George. I have already made arrangements for a memorandum of the kind described by the noble lord to be printed and circulated before the second reading of the patents and designs bill. O LBAg^l2 Deacidified using the Bookkeeper process Neutralizing agent: Magnesium Oxide Treatment Date: Oct. 2003 PreservationTechnologies A WORLD LEADER IN PAPER PRESERVATION .111 Thomson Park Drive Cranberry Township, PA 16066 (724)779-2111