§ 2.38 p.m.
§ Order of the Day for the Second Reading read.
§ LORD LUCAS OF CHILWORTH
My Lords, the Bill to which I am asking your Lordships to give a Second Reading seeks to amend and bring into line with modern requirements the law relating to patents and designs. Although a grant for the use and exercise of an invention is known to have been given by the Crown five hundred years ago, the first Statute for regulating such grants was the Statute of Monopolies of 1624. It is a matter of passing historical interest that it is almost fifty years ago to-day that what may be regarded as the greatest invention of the modern age first saw practical expression. It was fifty years ago that Marconi first transmitted a wireless message. Some measure of the growth of patents, and the part they play in the industrial life of this country, will be seen when I tell your Lordships that the Patent Office has just issued the one-millionth patent of which about 90,000 remain in force to-day. During pre-war years patents were granted at the rate of about 20,000 a year. This figure will give your Lordships some idea of the volume of work carried out by the Patent Office.
In passing, I would mention something that is not usually known—namely, that the Patent Office maintains what is considered to be the finest technical library in the world, containing 320,000 volumes, which are of great use to research students and the like. The public have free access to this library, and 2,000 people a week avail themselves of this privilege. Modern use of patents and industrial designs is based upon the Patents and Designs Act, 1907. Since that date seven amending Acts have been passed. If this, the eighth, meets with the approval of Parliament, it is intended to present two Consolidation Bills—one for the consolidation of the law relating to patents, and the other for the consolidation of the law relating to registered designs, which in future will be separate Statutes.
It is hardly necessary for me to tell your Lordships that this whole subject is very technical and complicated. Point is given to that observation by the fact that the Departmental Committee which the 753 Board of Trade set up in 1944 to review the patent law and its procedure sat for eighty-one whole days, over a period extending just over three years. The Committee were presided over by the eminent patent lawyer, Mr. Kenneth Swan, K.C., and the members of the Committee were specially chosen for their suitability to deal with the highly technical matters covered by the Committee's terms of reference. I would like to take this opportunity, on behalf of His Majesty's Government, of paying tribute to the Chairman of that Committee, and to the members, for the very able manner in which they discharged their heavy and involved task. The Committee presented three Reports containing recommendations and, with one exception, the recommendations were unanimous.
The First Interim Report was published in 1945 (Cmd. No. 6618), and dealt mainly with conditions arising from the war. The recommendations contained in that Interim Report were given legislative effect by Section 1 of the Patents and Designs Act, 1946, and I need not trouble your Lordships further with that Report. The Second Interim Report (Cmd. No. 6789) was published in 1946, and the Final Report (Cmd. No. 7206) in September, 1947. These Reports have had the careful consideration of His Majesty's Government, and the recommendations contained in them are substantially accepted. The Bill which I have the honour to present to your Lordships this afternoon is intended to give effect to certain of these recommendations and to make other changes in the law which, in the light of past experience, having regard to modern requirements, His Majesty's Government deem necessary.
Before I deal with the Bill itself, I would pause to explain to your Lordships that although it contains a large number of amendments of varying degrees of importance to the existing law, no radical change is made in the fundamental principles of the present patent system. With your Lordships' permission I will quote from the Second Interim Report. Paragraph 9 says:The theory upon which the patent system is based is that the opportunity of acquiring exclusive rights in an invention stimulates technical progress, mainly in four ways: first, that it encourages research and invention; second, that it induces an inventor to disclose his discoveries, instead of keeping them as a 754 trade secret; third, that it offers a reward for the expense of developing inventions to the stage at which they are commercially practicable; and fourth, that it provides an inducement to invest capital in new lines of production which might not appear profitable if many competing producers embarked on them simultaneously. This history of industrial development seems on the whole to have justified this theory.I would then direct your Lordships' attention to paragraph 11 in which the Committee say:We are in favour of the retention of the present system in this country, and this view is supported by witnesses who have appeared before us, representing both inventors and the commercial users of inventions. Some witnesses also expressed concern at the harm that would be caused to our foreign trade if, by any radical change in our patent system, we rendered ourselves ineligible for continued membership of the International Convention for the Protection of Industrial Property.His Majesty's Government concur in that view, and I think it will be for the convenience of your Lordships if I explain that the International Convention for the Protection of Industrial Property is an agreement between most of the leading countries of the world, whereby each gives to nationals of the others the same privileges in respect of patents as they accord to their own.
The Bill contains fifty-one clauses and three Schedules. As your Lordships will see, the fifty-one clauses occupy thirty-two pages of the Bill, and the three Schedules occupy thirty-three pages. In the interests of your Lordships' time and patience, I do not propose to detain you at this stage with the contents of the Schedules. I intend, with your Lordships' permission, to concentrate upon the main provisions as set out in the clauses, and to leave to another stage—if your Lordships desire the Bill to proceed—the consideration of a large number of detailed provisions, many of them of a complicated and a technical character and, I am afraid, not easy to understand. In order to assist your Lordships in following the alterations of the law which it is proposed should be made, a White Paper (Cmd. No. 7645) has been prepared containing the texts of two draft Consolidation Bills incorporating the amendments now proposed by this Bill. In an effort still further to assist your Lordships, I propose to group together under five heads the more important provisions, and I will deal with them in the following order: first, changes in 755 the procedure in connection with applications for patents and in the system of dating patents; secondly, improvements in, and amplification of, the provisions respecting the abuse of monopoly rights or insufficient use of patented inventions; thirdly, the enlargement of the provisions relating to the user of patented inventions for the services of the Crown, and for preserving secrecy of certain inventions; fourthly, improvements in, and reducing the cost of, legal proceedings relating to patents; and, fifthly, changes in the law and procedure concerning the registration of designs.
Dealing with the first group of provisions, Clauses 1 and 10 alter the existing law by making it possible for the person or persons to whom the inventor has assigned the rights of his invention to apply for a patent. The "true and first" inventor need not be a party to application, but his name must be disclosed in the application. Your Lordships will appreciate that there is good reason for this: it frequently happens that the inventor, having assigned his rights in the invention, loses interest, or is no longer available to sign the application documents. Clauses 3 and 4 make important changes in the dates given to patents, and the consequential alteration in the Patent Office procedure will bring our practice substantially into line with that of most of the countries belonging to the International Convention. For the future, it is proposed that the date of the patent, both domestic and Convention, shall be the date upon which the completed specification is filed. This does not affect the filing of provisional specifications or the claiming of priority dates, but the claim to priority will have substance only in the event of intervening circumstances which make the priority date of material significance. No change is made in the time of expiry of the patent; the normal term of sixteen years will in future date from the date of the patent. Some postponement of the times for the payment of certain renewal fees will be involved, but this will remove the sense of grievance which some Convention countries have had in the past. The new system has many advantages, not the least being that it will encourage better and fuller disclosure of inventions and the best way of working those inventions to the ultimate benefit of the public.
756 There is one point relating to the application for a patent to which I think it would be proper for me to draw your Lordships' attention, as it concerns the only recommendation which did not command the support of the whole of the members of the Swan Committee. In paragraph 79 of the Second Interim Report of the Committee, the majority recommendation was made that jurisdiction should be conferred upon the Comptroller to enable him to reject applications for patents that appeared to him to be wholly lacking in inventive merit or, to use the technical term, "subject matter." His Majesty's Government have given this subject careful consideration and, whilst not necessarily concurring in the objections put forward by the two dissentient members of the Committee, have decided not to implement this recommendation. However, the grant of a patent can be opposed on new grounds, as set out in Clause 6 of the Bill, which are in line with the recommendations in paragraphs 85 and 87 of the Second Interim Report and substantially cover the lack of subject matter.
I now come to my second group of provisions, those relating to the abuse of monopoly rights or insufficient use of patented inventions. May I pause here to explain that the essential right given by a patent is not the right of the patentee himself to make or use an invention but the right to prevent others from making and using it? That is the exclusive or monopoly right, and it is against the abuse of this right that safeguards are needed. Clauses 15 to 23 of the Bill replace Section 27 of the present Act, and incorporate some important changes in the law relating to the abuse of monopoly rights. It will, I think, be for the convenience of your Lordships if I explain that the law as it now stands—and it is not proposed to alter it—enables a patentee to request the Comptroller to endorse his patent with the words "Licences of right," whereby the patentee invites all corners to take a licence, the terms of the licence to be agreed by the applicant and himself or, in default of agreement, to be settled by the Comptroller. The patentee receives as a reward for this action a reduction of 50 per cent. in the renewal fees.
There is a popular supposition that inventions are deliberately suppressed, either by the patentee or by those who 757 have acquired the patent rights, in such a way as to amount to a public mischief. The Swan Committee formed the opinion that the prevalence of this type of restriction had been much exaggerated. Whether or not that be the case, His Majesty's Government feel that with the object of encouraging the greater use of inventions the grounds on which an application may be made to the Comptroller for a compulsory licence under a patent, the patentee having refused to grant a licence, should be enlarged. May I cite, as an example, the case where the patentee may be exploiting an invention to the full extent of his ability, but where there may be still other uses of the invention, or demands for the patented article, which remain undeveloped or unfulfilled? Or it may be a case where the demands of the home market are sufficiently met and an export market is neglected; or, again, where a subsequent inventor has made an important advance on what is regarded as the master patent and is prevented or hampered in working his invention by reason of refusal of the master patentee to grant him a licence on reasonable terms. Clause 15 makes provision for the grant of licences in this and like cases.
Clause 18 contains a new provision which enables Government Departments to apply for the endorsement of a patent "Licences of right" where there exist any of the grounds upon which a compulsory licence may be granted. Clause 18 (2) provides for action based on the proceedings of the Monopolies and Restrictive Practices Commission. While the fact-finding functions of the Monopolies Commission extend over the field of patents and patent licence agreements, it is left to this Bill to provide the mechanism for applying sanctions or remedies when the Commission report adversely to the patentee. Clause 18 also provides that where, according to a Report of the Monopolies and Restrictive Practices Commission as laid before Parliament under the relative Act, or according to a Resolution of the House of Commons following such a Report, restrictive practices are disclosed in the granting of licences and use of patents such as would be against the public interest, the competent authority under the Act may apply to the Comptroller for cancellation or modification of the restrictive conditions or for the endorse- 758 ment of the patent "Licences of right." In order to facilitate application to the Comptroller under these provisions, it is further laid down in Clause 21 (6) that any finding in a Report of the Monopolies and Restrictive Practices Commission as laid before Parliament relating to the use of a patented invention shall be conclusive evidence in the proceedings before the Comptroller. It is hoped that these changes which I have outlined will result in a wider use of the compulsory licensing provisions of the Acts than has hitherto been the case and, therefore, in a much greater use of patented inventions for the national benefit.
I now come to Clauses 25 to 29, which relate to the use of patented inventions for the services of the Crown. I would first of all explain to your Lordships that it is a condition of the grant of a patent, inserted as a proviso in the Letters Patent, that the patentee shall supply the patented article on reasonable terms to any Government Department for the services of the Crown, upon penalty of revocation of his patent. Where a Government Department order articles from the patentee himself, the Bill provides that the terms of any agreement between the patentee and any other person which might prevent or restrict the supply of the articles for the services of the Crown are to be inoperative in respect of such supply. In the particular case of manufacture by the patentee himself, no general provision is made for any claim to compensation. It is considered that the patentee is remunerated by the price of the articles which is paid to him by the Crown, and that any agreement he may have made with others cannot override the known rights of the Crown, which are clearly set out in the Letters Patent.
A different set of circumstances arise and call for different treatment, however, where a Government Department, or any person authorised by that Department, is allowed to make and use a patented invention for the services of the Crown. Neither the patent rights nor the terms of any agreement entered into by the patentee with any third party can interfere with such use. The patentee may, however, in this case claim compensation for such use, and the compensation, in the absence of agreement between the patentee and the Crown, would be settled by the court. Further provision 759 is made in Clause 27, to enable any person who has suffered loss because his agreement with a patentee has been made inoperative by the action of the Crown to make a claim against the patentee for a share of this compensation paid by the Crown. If the parties cannot agree upon the share, it may be determined by the court.
Clause 26 extends the right of a Government Department to use a patented invention for the purpose of supplying articles to the Government of another country under an agreement entered into between the two Governments. During the late war, the rights of the Crown to use a patented invention were extended by Defence Regulations to cover a number of purposes in the national interest, and this emergency legislation has been now incorporated in the Bill by Clause 29, so as to be immediately available in the event of another war. As your Lordships will appreciate, it may, however, be necessary for the Crown to use patents not only during a war but also during a period when a war is in prospect. The existing Defence Regulations are due to expire in December, 1950. Clause 29, therefore, provides that any new period of emergency during which these special provisions would apply should be fixed by Order in Council. Of course, it is intended that they should apply only during a period of national emergency.
§ LORD LUCAS OF CHILWORTH
That is defined by the Order in Council. Secrecy can be imposed on a patent for an invention relating to a munition of war under the present provisions of the Patents Acts, but the procedure is cumbrous and can be resorted to only when the patent has been assigned, and the provisions have proved to be insufficient in recent years. Since September, 1939, provision for secrecy has been made by Defence Regulations. It is proposed to repeal the pre-war provisions, and Clause 30 makes permanent the war-time procedure. Under this procedure, the Defence Departments advise the Comptroller of inventions or classes of inventions which should be kept secret in the interests of the defence of the Realm. When the Comptroller receives 760 an application for an invention failing within one of these classes, he makes an order for secrecy and notifies the Department concerned. That Department will then obtain a copy of the specification from the applicant, or permission from the Comptroller to inspect the specification at the Patent Office when the specification has been accepted. The Department will then inform the Comptroller whether the secrecy order can be cancelled. Clause 30 also provides for compensation if a Government Department should make use of the invention which it has decided shall be kept secret, and compensation is then payable as if a patent had been granted.
§ VISCOUNT SIMON
In that case, is the compensation paid only so far as the patent is used, or is the compensation paid because the owner of the patent is being deprived of its full exploitation, even though the Government are not using it?
§ LORD LUCAS OF CHILWORTH
The group of provisions covered by Clauses 32 to 38 and 46 and 47, which have as their main object improvements in, and reducing the cost of, patent legislation will be considered by some to be the most important in the Bill. There can be little doubt that the complications and technicalities of litigation in connection with patents have resulted in the piling up of costs to such an extent that the scales of justice are weighted in favour of the wealthy litigant and against the small man, be he inventor or manufacturer, who cannot face the financial burdens of such litigation. This was the burden of the conclusions of the Swan Committee. This matter is of such importance that I hope your Lordships will bear with me if I quote what that Committee said upon this subject in their Second Interim Report. I quote from paragraph 99:The complaint and criticism which have been directed against the present method of dealing with patent actions have convinced us that there is a widespread, in fact a universal, feeling of dissatisfaction. The commonest and most familiar ground of complaint 761 is the high cost of patent litigation, the reason for which we shall examine in due course; but there is also undoubtedly a very general lack of confidence in the adequacy of the tribunal before which these patent cases come, and a feeling that the Judges charged with the task of deciding patent actions have not the necessary scientific or technical knowledge or experience to assess the value of the expert evidence or arrive at sound conclusions where the invention in question involves, as it frequently does, the discussion of highly complex chemical, electrical, mechanical or physical matters.Paragraph 100 says:It is a common occurrence in patent actions of this kind that a considerable time (perhaps several days) is taken up in instructing the Judge in the elements of the technology with which the invention is concerned, in order that the specification can be made intelligible to him. In cases of this character, in which highly paid counsel and experts are retained on either side, this process of instructing the Court in the science of the case makes a very serious addition to the total costs.Paragraph 101 says:But there are other disadvantages, no less serious, in entrusting the decision of such cases to Judges who have had no previous scientific training, however learned and eminent they may be as exponents of the law.After enumerating these other disadvantages, the Committee say in paragraph 106:All these points have been stressed in the criticisms directed against the existing system, and amongst those who have expressed their views on this subject, complete unanimity prevails as to the urgent need for having patent actions tried by Judges who have not only the legal, but also the scientific and technical qualifications necessary for dealing expeditiously and satisfactorily with such cases.That was the unanimous conclusion of the Swan Committee, which contained three eminent lawyers.
Clause 47 provides for the appointment of an additional puisne Judge. The Bill makes no express provision for such qualifications as were outlined by the Committee. It is left to my noble and learned friend, the Lord Chancellor, to make such an appointment. There were many other recommendations made by the Committee which had as their objectives to facilitate, simplify and cheapen legal proceedings which find expression in the Bill.
Clause 32 allows for provision to be made by rules of court for the appointment of scientific advisers to assist the court in infringement and other proceedings. An adviser would have an expert knowledge of the art involved, and his 762 function would not be to assist the court in the trial of matters in issue but to assist the court in elucidating the technical aspects of the case. By Clause 34, an exclusive licensee may bring proceedings for infringement of the patent, the patentee, if necessary, being joined as defendant. Clause 35 provides that any person may appeal to the court for a declaration that any action he is taking in relation to making, using or selling an article will not constitute an infringement of a patent. At present, manufacturers proposing to make a new article sometimes have considerable difficulty in determining whether or not they would be infringing patent rights. They may not wish to incur the trouble and expense of a speculative action for revocation of the patent, but if they go ahead with their manufacture, using or selling, they may waste capital and become involved later on in infringement proceedings. It is hoped that the procedure of declaratory judgments will enable them to resolve their doubts in a speedy manner.
Clause 36 provides that a dispute between a patentee and some other person on the question of whether a patent has been infringed may, by agreement between the parties, be submitted to the Comptroller for determination, the Comptroller being allowed to award up to £1,000 in damages, unless the parties agree to a higher limit. Under the law as it now stands, all questions of infringement are determined by the courts alone. I would particularly draw your Lordships' attention to Clause 38, which deals with disputes between an employer and an employee as to the ownership of an invention made by the employee. My Lords, such disputes can be many and varied, and at present unless the parties can agree as to their respective rights, the only recourse is an action in the Courts. His Majesty's Government consider that it should be possible to settle these disputes by a more simple and cheaper process, and this clause provides that the Comptroller may, at the request of either party, determine the matter in dispute unless he directs that it would more appropriately be dealt with by the courts.
It is provided in the Bill that all appeals from decisions of the Comptroller shall go to the Patents Appeal Tribunal, not only in regard to the matters which the Comptroller is empowered by the present Act to decide but also in regard to the 763 additional jurisdiction which it is proposed to give him in this Bill. The Tribunal consists of a Judge of the High Court, but proceedings before the Tribunal are much cheaper than those in the High Court. It is not essential for a person appealing to the Tribunal to be represented by counsel; he can be represented by his patent agent. Moreover, in many cases the parties to the appeal are the appellant and the Comptroller, and in such cases there is no award of costs, whether the appeal is successful or not. Provision is made in the Bill for appeals from decisions of the Tribunal to be made in certain cases to the Court of Appeal.
I now come to the fifth and final set of provisions, those relating to designs. At present these may be registered in one or more of fifteen classes fixed by Board of Trade rules. The classification is completely out of date, and it is a curious mixture of particular kinds of articles, and articles made of particular materials, based, it is thought, upon a catalogue which was produced for the Great Exhibition of 1851. The Bill proposes, in Clause 40, that in future the protection conferred by registration shall be limited to the article in respect of which the design is registered. It is also proposed to exclude from registration, by rules to be made if and when this Bill becomes an Act, certain articles which are primarily literary or artistic in character; these will be then subject to the Copyright Act. The copyright in a registered design is enlarged by the provisions of this Bill to cover importation not only for sale but also for use in any trade or business. By Clause 42 the Bill further abolishes the existing requirements to mark articles bearing designs with the prescribed registration mark; instead, it provides protection for the innocent infringer on the same lines as in the case of patents. The secrecy provisions applying to patents will be extended to designs; and, as I have told your Lordships, it is proposed upon consolidation to separate the Statute dealing with designs from that dealing with patents.
My Lords, that is the Bill to which I ask your Lordships to give a Second Reading. If your Lordships express your contentment with the Motion I am about to propose, you will, on the Committee stage, have the benefit of the wisdom and 764 learning of my noble and learned friend the Lord Chancellor. At the same time His Majesty's Government will have the benefit of the helpful and constructive criticism of noble Lords opposite, which is one of the prime reasons why this Bill was introduced in your Lordships' House. I am conscious that in presenting this highly technical and complicated Bill I have been doing so in the presence of many noble Lords, not only learned in the Patent Law but widely experienced in the use of patents and inventions. It may have crossed the minds of some noble and learned Lords that in my presentation I have treated in a somewhat cavalier fashion the established customs and usages of the law. If that is thought, may I pray in aid of my speech what was once so truly said of woman?—Be to her virtues very kind,Be to her faults a little blind.My Lords, I beg to move that this Bill be now read a second time.
Moved, That the Bill be now read 2a.—(Lord Lucas of Chilworth.)
§ 3.19 p.m.
§ VISCOUNT SIMON
My Lords, I think we are all grateful to the noble Lord for the clear and exhaustive explanation which he has delivered to the House of this undoubtedly complicated measure, and the masculine vigour with which he has presented the considerations which he has set before us do not need any apology by reference to the gentler—I will not say the weaker—sex, with which he concluded his remarks. But, notwithstanding this clear, and indeed confident, account of the subject matter of the Bill, I still feel that the House, or at any rate most members of the House, may be rather disposed to regard this measure as dealing with a topic suitable only for specialists—as a measure where experts rush in where angels fear to tread. Let me therefore say at once, as I am venturing to intervene in the debate, that I am not claiming to speak as an expert about this matter. It so happens, however, that I have had, both forensically and judicially, some occasional contact with this interesting and difficult subject, and I feel strongly that it is one which the House must be prepared to consider with care and thoroughness in the Committee stage.
Although it is true that patents, and perhaps still more designs, are topics 765 which call for very special examination and careful understanding, the real subject matter of this Bill, clearly, is how the claims of an individual, who has rights, are to be balanced with the public interest. That, perhaps, is the first duty of Parliament—at any rate in the sphere of domestic legislation. What are the rights of the individual and how far should he be entitled to claim to enjoy those rights without interference? On the other hand, what are the rights of the community in reference to that which the individual has under his control? A whole series of questions, which every Parliament, in the course of time, has to consider, may be largely grouped under that issue. The important thing with regard to this Bill is to see that before it leaves this Chamber we have made the proper adjustment between the claim of the individual inventor whose brains, study and skill have led him to a particular form of discovery, and the claims of the community to which he belongs to take advantage of, and to enjoy, that which is primarily the product of his own brain.
There is no need, of course, in this connection to introduce the familiar controversy as to the extent to which nationalisation should go, but I hope that I may have the approval of noble Lords opposite when I say that although—whether wisely or unwisely—many forms of work may be nationalised, there is one thing which no Government, however accomplished, would be able to nationalise; and that is human brains. The brain will remain the equipment of the individual who possesses it as the result of training, research and diligence sometimes almost unfathomable, That is the real question involved in any big piece of patent legislation, for nobody, I think, disputes that the inventor of a patentable invention should be recognised as having a special claim, a special right. It is a product just as much as anything which he may construct with his hands or grow in his garden; it is a product of his brain, but it is a form of property which we all recognise as being something which attaches to him.
On the other hand, if (as has happened again and again in the history of every civilisation, and certainly in ours) from time to time some inventor makes a discovery of value, though in a sense it is his and belongs to him, he ought 766 none the less also to be regarded as making a contribution for the general good. Therefore we need legislation to secure that the general interests of the country are properly served and supplied on reasonable terms as between the inventor and the community at large. So I venture to submit—and this is the way in which I have always regarded this subject—that one ought not to leave this matter simply to the specialists. It is possible to understand many of the provisions of a Bill of this sort—at any rate the main ones—if one takes a little trouble and is reasonably well equipped, without at all claiming to be (and it is something which I certainly do not claim to be) a specialist in the matter.
That leads me to say a word about one matter referred to in the Bill and touched upon in the interesting review of its contents made by the noble Lord, Lord Lucas—that is, the proposal to authorise in this connection the appointment of an addition Judge. It may be interesting to your Lordships to notice, if you look at the Explanatory Memorandum, which is a preface to the Bill, that the last paragraph runs thus:Clause 47 provides for the appointment of an additional puisne Judge who will deal primarily with patent cases.I speak in the presence of the noble and learned Viscount the Lord Chancellor, but I do not think he will be likely to differ from me when I say that if, in fact, Clause 47 said that, I should be against it. I do not think it is right for an Act of Parliament to provide that a Judge should be appointed to deal primarily with a particular kind of case. Broad divisions may be necessary, but I happen to belong to the school which thinks, whether rightly or wrongly, that while one may have the greatest respect for those who are experts in these complicated and difficult scientific questions—heaven knows I do not claim to understand more than a very small corner of them—there are still good reasons for saying that, for judicial purposes and also, I may add, for the arguing of such cases, it is just as well to rely on an adequate and broader equipment in addition to the special qualifications which, I dare say, are appropriate.
The clause, itself, is unexceptionable in form. The noble Lord did not tell us that it does not, in fact, carry out the recommendation of the Kenneth 767 Swan Committee, which recommended that there should be two such Judges. In their Report, the Committee go on to discuss a very difficult question: If there are Judges who are, so to speak, earmarked for this purpose, and one does not like a decision given by one of them, what is going to happen when the matter is taken to appeal? The case goes to the Court of Appeal wherein, as a rule, sit three Law Lords, and they will not be similarly selected because of special attainments in this department. Peradventure, the matter may even come to your Lordships' House in its judicial capacity. No one has greater respect for the legal members of your Lordships' House than I have, or has more occasion to entertain that feeling of respect. But that they are a crew of patent lawyers, I most emphatically deny. The truth really is that, at any rate on occasion, we have to apply this principle—not acceptable, I know, in all quarters—that if a man is really well qualified to understand one thing by the use of his judgment, brains, attention and comprehension, that is some reason why, if he works at it, he will understand something else if it is also adequately presented to him.
So, while far from saying that there should not be included among His Majesty's Judges some who have, through their scientific training, a ready acquaintance with these matters, I do not believe it is a sound principle to say: "How can a man try Admiralty cases unless he has had experience for so many years at sea?" I will not ask what, if that argument were carried further, would be the qualifications required in the case of a man trying divorce cases. It is obvious that real qualification for judicial office does not depend in all cases on a precise acquaintance with the exact subject matter with which particular cases may have to deal. However, I have no objection to Clause 47. If the noble and learned Viscount the Lord Chancellor tells us that he thinks an extra Judge is needed, I have not the slightest doubt that he, or any other occupant of the Woolsack, will see, in making a selection, that there is work of a very special kind to be done and it is well to include among the Judges some who are well qualified to do it. I altogether deny that patent cases cannot be well tried by a Judge who has a much 768 wider range than that, for if that were so—I will not recite the names, but half a dozen names occur to me at this moment, not excluding some members of your Lordships' House—there are a number who, in that view, would be regarded as not capable of trying patent cases when they have tried them well again and again.
We shall gladly give a Second Reading to this Bill, and also gladly join the noble Lord opposite in expressing our appreciation of the very notable service rendered by Mr. Kenneth Swan, K.C., and his Committee. All I wish to do at this stage is to call attention to two or three provisions in the Bill which I select as illustrating the importance of considering the exact enactment we are prepared to approve when we come to the Committee stage. If I offer a criticism, it is not because I do not appreciate the general value of these proposals it is only because, when we come to the Committee stage, the things especially to be considered then will be those on which there might be some doubt and difficulty.
Take first of all the group of clauses which deal with the abuse of patent rights—Clauses 14 to 23. Of course, it is perfectly right to revise the law on this subject, but I think the question will arise in Committee whether the present language of the Bill does not go too far in some respects. These clauses set out the grounds on which a person who is not the owner of a patent may none the less apply to the Comptroller of Patents, a very important official of the Board of Trade, for a licence to use the patent. Normally, if everything goes well, a man who owns a patent—he owns it only for sixteen years—will be prepared to grant a licence on suitable terms to others who would like to use it. He receives a royalty, the licensee obtains the right to use the invention which the patentee has made, and all goes as it should go, without litigation and without dispute. But there are cases where, for one reason or another, a man who wants to use a patent which does not belong to him cannot get leave to use it on what he considers to be reasonable terms.
Clause 15 provides that:At any time after the sealing of a patent, any person interested may apply to the comptroller for a licence under the patent upon any one or more of the grounds specified in the next following subsection.769 In the next subsection a series of grounds are set out in a list. Speaking quite provisionally, without wishing to assert a final view, but merely to raise the point on Second Reading, I venture to ask whether the phraseology of some of these alternative grounds is not such as needs reconsideration. Take the first one:that the patented invention, being capable of being commercially worked in the United Kingdom, is not being commercially worked therein or is not being so worked to the fullest possible extent.Let us consider that. A man is to be entitled to apply to the Comptroller because A.B. has a sealed patent. He says he is entitled to compel this patentee to give him a licence and his ground is that it is not being worked "to the fullest possible extent." I feel quite confident that there are a great many instances where, from the very nature of the case, one could not expect any reasonable person the day after, or the week after, he has obtained a sealed patent to use it "to the fullest possible extent." In some cases it might very well be that a considerable preliminary outlay is required. It may very well be that a patentee has to do his best to promote a demand for the article. I suggest that this phrase "to the fullest possible extent" is too stiff, and what, really is, or ought to be, meant is "to the extent that is reasonably practicable," which is quite a different test and, I venture to think, a much more appropriate one.
I am a little confirmed in my view if I remind the authorities of the wording in the principal Act—the Lloyd George Act of 1907. When Mr. Lloyd George, as a young Cabinet Minister, produced for the first time in the House of Commons his principal Bill of the Session, some people thought he did not show himself a very good free-trader in some of the clauses that Bill contained; but then he was never a purist in those matters. The main Act of 1907 contains phraseology which I think is worth comparing with the present wording. Look at Section 24 of that Act, which speaks of:the reasonable requirements of the public with respect to a patented invention have not been satisfied",and the default is described, I think, as a failure to manufactureto an adequate extent and supply it on reasonable terms.770 I will not speak longer about this because it is a Committee point, but I think the language used in Clause 15 of this Bill is a little too severe.
In the same way I very much doubt whether the next paragraph of the clause is phrased in the wisest terms. Paragraph (b) provides:that a demand for the patented article in the United Kingdom is not being met on reasonable terms, or is being met to a substantial extent by importation.The second part of that test means that the patentee holding a British patent has none the less so arranged matters that the patent is being applied, not inside this country but outside, and that the product is therefore being imported into this country instead of being made here. Of course, nothing is easier than to excite people on the argument that everything should be made in this country and not imported: though what would happen if anybody really tried to carry that cut is the same as would happen if everybody expelled his breath from his body and never drew any breath in. The truth of the matter is that, within reasonable limits, imports and exports have a relation to one another.
If I may suggest a purely imaginary case, let me suppose that the invention is one which could be best used in the tropics. Perhaps it is an invention connected with the preservation of tropical fruits. It may well be that the best thing is for it to be exploited in Jamaica or West Africa, or where you please, and the demand in this country should be met to a substantial extent by importation. If that is done, you may thereby organise an export which helps to pay for it. I am sure that what is meant here is what is not stated—namely, that this test is a good test only if what is found to be the fact is being done "contrary to the public interest." Perhaps when we come to the Committee stage some words of that kind might be considered for the purpose of qualifying the test. The same remark applies to paragraph (c). Similarly, I think that when we come to one or two other provisions of this part of the Bill it will be desirable to see whether the language is quite suitable. I mention merely paragraph (d), where I think the phrase should not be, "prevented or hindered,", but "prevented or unfairly hindered," because, within limits, in many cases you 771 are certain to be hindering the working of a patent here if you are importing to meet the demand.
I now turn to Clause 18. Here I must say I think it is fairly clear that the clause goes further than we would wish to go, and I hope, on reflection by the Government, further than they would wish to go. Clause 18 is a clause to which my noble friend opposite made some reference in his speech. It is the clause which provides:At any time after the sealing of a patent, any Government Department may apply to the Comptroller for the indorsement of the patent with the words 'licences of right' upon any one or more of the grounds specified in section fifteen of this Act;As my noble friend has reminded the House, "licences of right" is a phrase that is used to mean that, though you may be the exclusive owner of the patent, you are required to let anyone who chooses get a licence from you on terms which are either arranged or can be reasonably settled. It really turns the patent in that case from being what I may call a proprietary article into something which is to be supplied to everybody on royalty terms. How can a man the day after his patent is sealed be expected to be working it commercially to the fullest possible extent? I have already pointed to that difficulty under Clause 15. Yet if he is not doing so, under Clause 18 any Government Department may forthwith apply for the patent to be indorsed with the words "licences of right." As I understand it, Clause 18 does not seem to me to give due weight to an important paragraph in the Kenneth Swan Report. I may be wrong about this matter. I just offer the observation to my noble friend, and I am sure he will consider it.
If your Lordships turn to the Second Interim Report, from which the noble Lord has already quoted, on page 11 you will see that the members of the Committee deal with what they describe as "suggested remedies." The Report says:One proposal which has been widely discussed is to indorse all patents on grant with the words 'Licences of Right' in the same way as patents are at present voluntarily indorsed under the provisions of section 24. It is apparent that, if this proposal were adopted, it would radically alter the nature of a patent, and reduce it to a right to receive royalties for the use of the patented invention.772 They go on to argue that so drastic a step would really operate to discourage patentees, and to discourage the disclosure of inventions, and would run counter to what is necessary—namely, that the State should grant to the inventor for a certain time and under certain conditions exclusive use or, at any rate, exclusive ownership combined with a granted permission to other people to use it also. I appreciate that the Swan Committee were dealing with a wider proposition than the proposition found in Clause 18. At the same time, I think the considerations which they put forward need to be carefully weighed in connection with the more limited application which one finds in Clause 18. I would invite my noble friend, as representing the Government, to consider between now and the Committee stage whether they have not, as a matter of fact, put that rather higher than they should. That is all I wish to say at the moment about that part of the Bill.
There is, however, another very important part of this Bill, to which the noble Lord made reference, though I doubt whether what he said would necessarily convey fully all that is involved in the clauses to which I now want to refer. They have to do with a body called the Monopolies and Restrictive Practices Commission. That is a new body. I think if you set an examination paper to Members of Parliament of both Houses it is quite possible that they would not all get good marks if they were asked what that body is, and how it is composed. The fact of the matter is that we all agreed to set it up by legislation last year. My knowledge of the matter, I am afraid, has been largely derived from reading the Statute after it was passed. In that I am to blame. But under the Monopolies and Restrictive Practices (Inquiry and Control) Act, 1948, there is set up what is called a Monopolies and Restrictive Practices Commission. That Commission is provided for elaborately in the Act. It consists of a number of persons who are nominated by the Board of Trade; its procedure is to be decided by the Commission itself (I will refer to one or two things about that in a moment); and its principal duty is to consider some branch of supply or manufacture referred to it by the Board of Trade in order that it may make a report. The Monopolies 773 and Restrictive Practices Commission may make a report which can either be limited to saying: "Such and such are the facts, and that situation may be expected to operate against the public interest, because there is too much of a monopoly about it"; or, alternatively, they may say: "Those are the facts, and we do not say any more about it, but leave others to decide whether it is a good or a bad thing."
I must confess that when I refreshed my memory by reading this Statute of last year—more candidly, I should say, when I read it for the first time yesterday—I was much interested to know whether this inquiry (aimed, of course, at exposing the wickedness of monopoly) could possibly apply to nationalised industries, because the evil which is defined in the Act is that as much as one-third of a supply comes from one source. In nationalised industries the whole of the supply comes from one source. I thought how interesting it would be if the Board of Trade appointed a Monopolies and Restrictive Practices Commission to look into some of those matters and decide—what otherwise might be a rather difficult question for a prejudiced man to determine—whether such monopolies are good or bad things. However, I notice that that has been very ingeniously sidetracked in the Act of last year, because that Act contains this provision at the end of Section 2:Provided that a reference shall not be made under this subsection where the prevalence of the conditions in question"—that is, the monopoly—is expressly authorised by or under any enactment"—that excludes coal and railways, and will exclude iron and steel—other than the enactments relating to patents and trade markswhich brings in the analysis of a possible monopolistic effect in the case of the owners of the trademark.
The reason why I think these clauses need to be reconsidered is this. If your Lordships turn to page 16 of the Bill, Clause 21 (6), you will find it says:In any proceedings on an application made in relation to a patent under sections fifteen to twenty of this Act, any statement with respect to the making, using, exercising or vending of the patented invention … contained in a Report of the Monopolies and 774 Restrictive Practices Commission … shall be conclusive evidence of the matters stated.In other words, there is a body, no doubt a most admirable body, appointed by the Board of Trade. That body has, at the request of the Board of Trade, to investigate the alleged disadvantages of undue monopoly in some trade or other. It makes a report. The report may be accurate or it may be inaccurate, but whatever it says is not only to be evidence but is to be conclusive evidence of anything which is relevant for the purpose of applying Clause 15—that is to, say, whether it is an application by a man who would like a licence, or whether it is an application under Clause 18 by a Government Department. I cannot think that that is right. What makes it still more extraordinary to me is that when I look at the Monopolies and Restrictive Practices Commission and ask where the security is that this body has really got hold of the right end of the stick, I find that it is not required to hear persons interested (it may, but it is not required to do so); it is not required to sit in public; it may shut out everybody it likes except those whom it chooses to let in, and the whole report need not be presented to Parliament. I can only say that, for my part, not being at all in favour of the totalitarian system of government, I am not disposed to approve of a proposal which will invest with a sacrosanct and inspired character any statement made in the report of the Monopolies Commission when the Monopolies Commission act in those circumstances.
Another thing which is very odd to me is this. If your Lordships turn to page 14 of the Bill, apparently it is intended to act on the authority of such a report before ever Parliament has considered the report at all. Your Lordships will observe in Clause 18 that if such a report, in respect of some trade or supply, says that the circumstances are such as to create an undue monopoly, then action may be taken by "a competent authority"—which is merely Parliamentary language for a list of half a dozen Government Departments — merely because the report says so, even before the report has been presented to Parliament and without any regard as to the view which Parliament takes of the report.
775 There, again, I must say that I think we are in danger of elevating the doubtless careful pronouncements of this official body to a position which does not obtain even in our Law Courts. There has been no sort of judicial inquiry; there has been no right given to those who wish to object or to appeal; there has been no sitting in public and yet, according to the way in which this Bill is drawn—unless I quite misunderstand its purport—these very surprising results follow because of a statement in the report of the Monopolies Commission. That is a matter which we may have to consider rather carefully. If I am right in my reading, I cannot believe that your Lordships' House would not think that rather an extreme example of legislation: to permit a Government Department to do away with an individual's property and rights without the protection of the courts, without the protection of Parliament and, indeed, it may be, without hearing what he has to say. If I am wrong about that, I shall be very glad to be corrected, but at least I think it is sufficiently important to mention it at this moment.
There is one other matter which I would venture to mention briefly. I think we shall need to examine rather carefully the clauses which provide for the use of patented inventions for the services of the Crown. Here again, the general idea is perfectly right. Of course the community at large has a prior right to the right of any individual when the defence of the Realm or the safety of the State is involved. That goes without saying. That has always been so under our Patent Law. There is a section in the Act of 1907 which is very familiar to anybody who has had to do with this dismal subject—I think it is Section 29. It is the section which provides thatany Government Department may by themselves, their agents contractors or others, apply the use of an invention for the services of the Crown on such terms as may … be accepted by the Treasury after hearing all Parties interested.That is perfectly right, but in this new Bill—which we shall have to examine more in detail later on—Clauses 26 to 29 raise some quite serious questions. I particularly ask attention to the opening words of Clause 29, because really the matter is drawn so beautifully that unless one looks at it rather closely one thinks, 776 "That is reasonable enough." It begins with the words:During any period of emergency within the meaning of this section, the powers exercisable in relation to an invention by a Government Department, or a person authorised by a Government Department under section twenty-six of this Act shall include power to make, use, exercise and vend the invention for any purpose which appears to the Department necessary or expedient"—and then follows a whole list of things.
I may point out that the list is exceedingly wide. For instance, one of the purposes is in order to promote the productivity of industry, commerce and agriculture. I can well understand a school of thought which thinks that the best way in which to promote industry or agriculture is for the Government to acquire the use of a patent, not because it is necessary for the defence of the Realm or anything of that kind, but because, after all, they will manage these things much better than anybody else. Again, there is one paragraph which I am sure must give great comfort to Mr. Aneurin Bevan. That is paragraph (g), under which apparently the Department may, if it appears to the Government expedientfor assisting the relief of suffering and the restoration and distribution of essential supplies and services in any part of His Majesty's dominions …claim Crown user. Those are very wide powers. The noble Lord opposite quite correctly explained that that, or something like it, was to be found in the Emergency Regulations. Yes, but the Emergency Regulations were made for the purpose of a temporary emergency and as he pointed out, they will come to an end necessarily quite shortly.
Therefore, the question really is—and I set it to your Lordships, if I may respectfully do so, as a rather interesting case of "hunt the slipper"—what is "the period of emergency" under this clause? I need hardly say that the draftsman provided the answer. It is in subsection (2) and it says:In this section the expression 'period of emergency' means the period ending with the tenth day of December, nineteen hundred and fifty, and any other period beginning on such date as may be declared by Order in Council to be the commencement, and ending on such date as may be so declared to be the termination, of a period of emergency for the purposes of this section.777 Your Lordships will observe that an Order in Council is, of course, an instrument of the Government of the day. His Majesty and a number of Privy Counsellors meet in Council, the draft Order is before them, the Lord President mentions the name, and His Majesty says "Approved." There is no question at all of Parliament or the public being consulted. So it appears that a period of emergency under this clause may go on for ever: we are always to live in an emergency. That seems to me a rather serious matter, in view of the fact that the clause itself gives power to any Government Department to say, "It appears to us that it would be a very good thing, though you do not like it, if we were to take over this invention of yours and use it, because, after all, it is for the relief of suffering, and a well-constituted Government is able to do this sort of thing very much better than anybody else." I think there may be some members of your Lordships' House who would regard that as carrying the totalitarian principle which is inherent in Socialism rather far.
There are other observations I might make, but I desist because I have occupied too much time already. I do not want to be at all critical of the general purposes of the Bill. I have picked out these particular points because they are matters which we must consider very carefully in Committee. But the main object of the Bill, which is the bringing up to date in many respects of certain matters, will, I think, be uncontroversial. We want to shape this measure quite impartially and to make it as fine an instrument as we can. I hope that before it leaves this House it will be felt to have been backed not only by a Government speaker or one or two experts, but by the general approval and good sense of this House. I repeat that I am not in the least opposed to the general purposes of this measure. I urge only that our duty as ordinary members of Parliament—not as experts—is to take the trouble to understand the effect of some of these things and to ask whether, in some respects, they do not need modification.
§ 4.3 p.m.
§ VISCOUNT MAUGHAM
My Lords, I should like at the beginning to say that I entirely agree with the observations which the noble and learned Viscount, 778 Lord Simon, has made. These questions must be very carefully considered, and I am sure that noble Lords on the other side, and the noble and learned Viscount on the Woolsack, will not in any way grudge the time which will be required to examine with the greatest care, before it reaches the Statute Book, the provisions of this important Bill. With regard to Committee points, I will mention only one which it might be worth while adding to those which my noble friend has mentioned. It would come under Clause 6 of the Bill. Clause 6 states:An application for a patent may be opposed under Section eleven of the principal Act upon any of the following grounds …(a) that the invention, so far as claimed in any claim of the complete specification, was used in the United Kingdom before the priority date of that claim;…Provided that for the purposes of paragraph (a) or paragraph (b) of this Section no account shall be taken of any secret user.What I should like to have very carefully considered is whether those words are not rather too wide.
I can illustrate the matter by citing the case of the Haskell golf ball. Mr. Haskell was an American subject and came over here with this patent, which had a great effect on human entertainment. The patent, of course, had to run the gauntlet of there having been an "anticipation." A delightful old gentleman who used to live in St. Andrews had invented a golf ball which was constructed by putting a small piece of rubber, or something of the sort, in the middle of what was going to serve as the ball, and then winding round elastic. The only elastic which he could find was taken from the two sides of a pair of elastic-sided boots. He used the elastic, and asked Tom Morris to make the outside of the ball. He then went out on the links at St. Andrews, and played soma shots, to his entire satisfaction. However, it was rather difficult to obtain the proper rubber, and he did not pursue the matter. But Mr. Haskell had to meet the point that there had been an anticipation of the user by the fact that the object of the patent had been used on the links. It was, in fact, held to be an anticipation, and Mr. Haskell got nothing out of his invention in this country.
That is an example of the sort of case in which it is impossible entirely to safeguard an invention; that is, if the user, for the experiment on or improvement 779 of the invention has to be only of a semipublic nature. It has always been held that the user for experiment was not a user, and some such words ought, I think, to be inserted in this clause—or, at any rate, the matter should be further considered. If a man invents a new appliance for use in an omnibus or a railway train, or something of that sort, and it requires testing openly for the purposes of experiment it should not debar an application for the patent under Clause 6 of the present Bill. The same thing, of course, would apply to motor cars.
I should like to say something of a more general character before I sit down. It is partly in reference to what the noble and learned Viscount, Lord Simon, said as regards patents and inventions. It is a long time since the Statute of Monopolies was passed, and the whole of scientific knowledge has been entirely altered. It is little exaggeration to say that the whole future progress of the world's science depends upon research, and that tens of thousands—I dare say millions—of people in difference countries are now engaged in different kinds of research, some of which may result in a patent for which they deserve to be remunerated but a great deal of which will not produce any patentable invention. In the United States, in this country and, before the last war, in Germany, there were vast numbers of employees of large companies who were engaged in nothing but research for the purposes, if possible, of obtaining a patent.
I myself remember being concerned as a judge with a dyestuff patent of very great complexity. I think that the plaintiffs were an English company controlled by the great German fabric industry which was known all over the world. In connection with that case, I was told that there were about 2,000 people employed by the German parent company, simply for the purposes of investigating different combinations of materials which would enable them to produce new dyestuffs. They had had to work day after day with slight alterations of the quantities of material—and sometimes of the material itself—put into dyestuffs. The Germans, with a pertinacity worthy of a better cause, patented in this country thousands of these materials in the hope that, after the patents were obtained, at least one 780 of the thousands, or a much greater number, would be discovered to be a really useful article which would repay them for all the huge sums expended and for all the great trouble they had taken in connection with this kind of research.
Something of that sort is going on all over the world to-day in connection with chemical products, with flying machines, with products of atomic energy and with a number of other great inventions which may revolutionise civilisation in the future. I wish that my noble friend Lord Cherwell would tell your Lordships something about the position of inventions. His knowledge is infinitely greater than mine, and he could explain to your Lordships in detail that almost everything depends upon research. I believe that it would be a tremendous mistake to do anything which would make the task of the inventor greater than it is at present, or the rewards of the successful inventor less than they now are. One must not suppose that, because an inventor has produced his invention, and patented it according to these proposed clauses, he has done his work and will reap some reward. I could give your Lordships numbers of instances of the most ingenious and, apparently, the most simple invention, where the inventor can do nothing with it.
I will mention only one such example—an invention which we all have in every-day use and which, I imagine, the fair sex use more than we do—that is to say, the Zipp fastener. The inventor of the Zipp fastener travelled round England trying to get somebody to take it up. Nobody would take it up until at last a particular well-known tobacco manufacturer thought it would be useful for closing tobacco pouches. After that had been placed on the market, the world suddenly came to the conclusion that here was an invention which could be used for all kinds of businesses. I have said that because I hope very much that, in considering the clauses of this valuable Bill, we shall bear in mind that inventors, as a class, are among the worst paid, able people in the world. They have the hardest possible time and the rewards for their inventions are often nothing at all. Fleming, who invented the Fleming valve, could not find anybody to take it up, with the result that he could not afford at that time to pay the renewal fees. That 781 particular invention is in use in every radio set in the world. That is a single example which may be interesting to your Lordships.
I urge your Lordships, therefore, to realise that the granting of a patent is the granting of a limited monopoly for a limited time; so it must be looked at with considerable care. The position of the patentee or his assignee must not be made more difficult than is in the public interest necessary, The clauses which give people the right to attack an inventor's patent, or to obtain compulsory licences, and so on, ought to be looked at with great care. Speaking in wide and general terms, I think that this Bill is an admirable Bill, and it will do a great deal to help the inventor, subject to a careful scrutiny of some of the matters which have been referred to. I have not the smallest doubt that the Bill deserves a Second Reading, and I hope that, improved as it may be before it passes through this House, it will be able in a short time to improve the position of inventors, whose interests I have at heart.
§ 4.18 p.m.
§ LORD LUCAS OF CHILWORTH
My Lords, after listening to the noble and learned Viscount, Lord Simon—who I suppose is one of the most knowledgeable lawyers upon patents in this country, and who, in presiding over your Lordships' House in its judicial capacity, has delivered a judgment which has shattered the patent world—and to the noble and learned Viscount, Lord Maugham—who, I suppose, if I may be allowed respectfully to say so, enjoys the reputation of having been one of the most eminent Chancery Judges that this country has ever had—noble Lords in all parts of the House will realise that, when I stood at this Despatch Box earlier this afternoon, I felt like Daniel entering the lion's den. I cannot grumble at the quality of the lions I have had to face! As the noble and learned Viscount, Lord Simon, and the noble and learned Viscount, Lord Maugham, have said, most of the arguments that have been advanced require and deserve the close argument more appropriate to the Committee stage than to the winding up of a Second Reading. Every observation which both noble Viscounts have been pleased to make has only borne out what I have already said 782 —namely, that His Majesty's Government would have the benefit of their constructive criticism, which will be very seriously considered.
I would, however, detain your Lordships for just a minute on the point which the noble and learned Viscount made about the appointment of another Judge. He asked whether we are to have Admiralty Judges and Divorce Judges with scientific accomplishments appropriate to their branch. That, my Lords, I am not concerned with. What I am concerned with—and Lord Maugham referred to this—is the present piling up of costs in patent actions which may last, and have lasted within this past month, for up to thirty days, with counsel's fees at the rate of £1,000 per day. How can the poor and impecunious inventor or manufacturer have a chance of securing justice in those circumstances? I maintain that that must be the overriding consideration of His Majesty's Government, if I may say so without any disrespect for the old-established practices, and also the prejudices, which have hitherto existed. The reason why His Majesty's Government did not accept the Swan Committee recommendation for two additional Judges was because in the past the number of patent cases which have gone to the Court of Appeal represent only about 40 per cent. of the total; and if the other recommendations in this Bill meet with the approval of your Lordships, we hope that that percentage w ill be radically reduced.
§ VISCOUNT SIMON
I do not think I disagree with what the noble Lord is saving, but if the proportion is 40 per cent., whether you have this or not it means that 40 per cent. of the cases will go, on appeal, to a tribunal which does not consist of any of these experts.
§ LORD LUCAS OF CHILWORTH
Yes, except perhaps if your Lordships' House accepts the Committee's recommendation about the expert adviser. But if the noble Viscount would care to put down an Amendment on the Committee stage to increase the number of Judges from one to two, I am sure we should consider it very seriously.
783 On the case which the noble and learned Viscount raised on Clause 15—that of an invention not being worked to the fullest possible extent—may I direct his attention to Clause 17, which seems wholly to have escaped him up to the present? That clause sets out the considerations which the Comptroller will have to bear in mind in arriving at any decision on matters submitted to him under Clause 15. Clause 17 (2) specifically lays downSubject to the foregoing subsection, the Comptroller shall, in determining whether to make an order in pursuance of any such application, take account of the following matters, that is to say:In other words, the Comptroller does not, out of hand, give permission under Clause 15. He has to have regard to all the circumstances.
- (a) the measures already taken by the patentee or any licensee to make full use of the invention;
- (b) the ability of any person to whom a licence would be granted under the order to work the invention to the public anvantage; and
- (c) the risks to be undertaken by that person in providing capital and working the invention if the application is granted.…"
§ VISCOUNT SIMON
I agree that we may reserve this for Committee, and we are not at all likely to quarrel. But I think the noble Lord has been given the reference rather hurriedly, so may I point out that Clause 17 (2) (b) and (c) are not tests applying to the patentee at all. The tests there are as to whether the person who claims to be interested is a person who will, if he is granted the licence, be able to work it, or whether the risk which that person runs are such as are fully taken into account. With great respect, it has nothing to do with the patentee at all.
§ VISCOUNT MAUGHAM
May I add this?—that the trouble with the inventor is that he cannot get anybody to work his invention or to take it up. I cannot help thinking that such a clause as Clause 17 ought somewhere to have a proviso in it to say that the inventor is not to be blamed if he has been using his best endeavours to obtain somebody to work the patent.
§ LORD LUCAS OF CHILWORTH
Although this discussion would be of 784 interest to both noble Viscounts and to myself, I think perhaps in the interests of the patience of other noble Lords we had better postpone it until the Committee stage. The noble Viscount made reference to the Monopolies and Restrictive Practices Act. In relation to what it imposes this Bill follows strictly that Act. I think perhaps that will require close argument on the Committee stage. The only other point is the noble Viscount's question as to what constitutes an emergency. The emergency will be declared by Order in Council. If the noble Viscount can put forward any better suggestion as to who should declare an emergency, I am sure we shall be only too glad to consider it. I thank both Lord Simon and Lord Maugham for their support in principle of this Bill. His Majesty's Government look forward to having the help and criticism of both noble Lords on the next stage of the Bill.
§ On Question, Bill read 2a, and committed to a Committee of the Whole House.