COMMISSIONER LEHMAN:  Next, I would like to call
       Mr. Harold C. Wegner.
 
       MR. WEGNER:  Thank you, Mr. Assistant Secretary,
       Deputy Commissioner, Deputy Assistant, and Madam Solicitor. 
       Thank you for this opportunity to appear.
 
       My name is Harold Wegner.  I am Professor of Law
       and Director of the Intellectual Property Law Program at the
       George Washington University National Law Center; Director
       of the Dean Dinwoodey Center for Intellectual Property
       Studies; and of counsel to the law firm of Foley & Lardner. 
       My address for this hearing is Foley & Lardner, Suite 500,
       3000 K Street N.W., Washington, D.C. 20007.
 
       All of the comments I make today are on my own
       personal behalf and do not necessarily reflect the views of
       any organization with which I may be associated.
 
       First, if these proposed rules were final rules,
       they would be the best example of positive rulemaking that
       the Office has had in many, many years, reflective of both
       the talent and attitude of a superb staff that you put
       together in just the last couple years.  So if these were
       final rules, they would be excellent.
 
       They are only provisional rules, and you have
       given us the opportunity of looking at options and
       variations.  I think most of the possible weak spots that
       could exist have been explained in your proposed rulemaking
       and have been adequately addressed by the several
       commentators who have taken time to diligently make
       comments.
 
       With our permission, in these remarks I would like
       to discuss some of the points that strike out, which strike
       me, which have struck many of the people here today.  Kate
       Murashige maybe said it best:  Why is it that we have had
       Rule 62 practice in so many continuing cases?  And, why
       couldn't we simplify this earlier?
 
       The reason we couldn't encourage voluntary
       refiling of cases earlier was, the public has a right to
       have a time to practice an invention.  Now, we have a cap at
       20 years.  Now, we can liberalize.
 
       What we are talking about, basically today, is
       fees and beans.  Fees for the office and bean counting.  Why
       did the strict, hard-ball approach evolve in the late 1970s
       to force refilings of cases?
 
       This goes back to the late era of Edward Brenner,
       when he went to Congress and said, we are cutting the back
       log, we are cutting the pendency.  And pendency was counted,
       bean counting was counted from the actual time of pendency
       of an application.
 
       So if you had a first application pending for 10
       years and then had a continuation that was pending only six
       months, the pendency was six months for the bean counting.  
 
       Now is the time to make a sea change and get away
       from the bean counting.  To start fresh, to start counting
       how we are doing, measuring from the first filing date. 
       Let's replay the down, let's start the game over, and let's
       look at accounting procedures that measure the term of the
       patent from the first filing date.
 
       Let's also get rid of the bean counting in terms
       of promoting examiners by how many refilings they can force,
       and let's see their actual production.  How many cases can
       be allowed?
 
       These reforms are essential.  Otherwise, it will
       never work, to say let's have a more liberalized practice to
       permit continued prosecution because examiners, the bread on
       their home table, their promotions, are based upon how many
       disposals, how many cases they have.  So every time a
       continuation is filed, they get another disposal widget,
       another credit.
 
       We have to replay the down, start all over again,
       and have a new system.
 
       Having said that -- and let's do that -- then,
       let's abolish Rule 62 altogether, and replace it by a simple
       form.  Just like you pay a certain fee for a Notice of
       Appeal, you would pay a certain fee to erase finality and
       maybe set a three-month period, to make a voluntary
       amendment, to start procedures all over again.
 
       We can do that, now, because we have the 20-year
       cap, so let's take advantage of that and move forward.
 
       Also, the constructive suggestions of several of
       the speakers on restriction practice should be noted and
       taken into account.
 
       I very much value the opinions of Richard
       Donaldson and what he said about measuring the diligence
       during the appeal period.  He is on all-fours.  He is
       exactly right, and that was very constructive.
 
       Mr. Irving talked about the Patent Office giving
       guidance on Hilmer.  With due respect, you don't have the
       authority to do that.  That is up to the courts to decide. 
       The best you can do is to give a warning, to say there is an
       uncertainty, here.
 
       And with due respect to this noted speaker, there
       are other arguments that can be made the other say, and
       whether he or I favor a particular solution, we are limited
       in what we can do in the rulemaking, in the comments, by
       what the statute permits.
 
       I would only say, the Hilmer problem with respect
       to provisionals, is a serious remaining problem and should
       be dealt with by legislation.  I am not proposing what that
       legislation should be.
 
       I do agree with Mr. Irving that, if it is his
       suggestion, that a PTC application filed anywhere in the
       world, but actually filed before June 8th, this is under the
       old law and 35 U.S.C. 363 makes this absolutely clear, and
       there is no dispute on this issue so I would think one
       sentence to this effect is very good, because this is fine.
 
       Some people are talking about how we are losing
       rights under the Constitution.  The Constitution is best
       served by a strong system.  Investments are best served by
       having certainty.  That includes certainty as the third
       party rights.  That includes having everyone get their
       patents granted as soon as possible.
 
       What we have in this legislation is really a net
       21-year term, when we count the provisional filing year. 
       And the net pendency today is much less than 21 years, so
       what we are doing is giving a bonus to the diligent who push
       their applications through.
 
       There are some who suggest that it is not bad if
       we have patents expiring 30 or 40 years after the filing
       date.  Let's look at the cost.
 
       In addition to the problems that are raised for
       industry, the uncertainties.  Maybe a Phillips made $300
       million in the bonus round by having this extension.  What
       happened to American industry during that period?
 
       Where did competitors go?  Did they go to Holland? 
       Did they go to Japan, to Taiwan, to compete for the world
       market because patents were expired in those countries?
 
       Why should we punish American industry?  If we
       want to encourage American jobs, we should encourage jobs at
       home.  So when patents expire abroad, how dare we let these
       patents linger on for 30 or 40 year?
 
       But let's look at administrative costs.  If we are
       going to stretch a patent out an extra 20 years through this
       gamesmanship, this means that the prosecution is churning
       for 20 years.  We, the taxpayers, are paying for that.  We,
       who have our applications held up because of a backlog, can
       thank the people who are letting their cases linger in the
       Patent Office for 20 or 30 years for this benefit.
 
       Mr. Newtson made a very important comment.  We
       must simply.  I think the problem is more macroscopic.  It
       is not limited to provisionals.
 
       The first thing we should do is find a big trash
       barrel and take this big volume known as the Manual of
       Patent Examining Procedure, or Nightmare from Hell:  How to
       Reject the Case, and throw it away.
 
       Throw it away, and let's reinvent the manual, and
       let's teach examiners and attorneys, alike, how to allow
       cases.  How they should construct their cases.  We refer to
       objects of the invention.  Those aren't statutory
       requirements for anything.
 
       Let's just take the manual and get a trash barrel
       and throw it away.
 
       Mr. Armitage was the first speaker to touch on
       inventorship.  That is a very important point and I am
       supplying my comments separately on this.  
 
       Germany doesn't require inventorship nomination
       for 16 months.  There is no reason we should punish
       applicants by requiring an accurate inventorship nomination
       any earlier than the Germans do.
 
       Submarine patents, Mr. Wolstenholme mentioned an
       isolated cancer.  It is a cancer, I think it probably is a
       minority of the cases, but it is growing.  It must be cut
       out.  This is a cancer on the Constitution.          It is a cancer
       on our patent system.
 
       Finally, Mr. Litzsinger raised some very
       interesting points.  We must protect the rights of the
       individual inventors.  We do that best by following the
       suggestion of Mr. Newtson and simplifying applications.
 
       We do that best by having an open prosecution with
       sunshine.  There are abuses by applicants, some attorneys,
       and examiners, alike.  Let's have sunshine prosecution. 
       Let's have the 18-month bill put into law.  Let's have open
       prosecution.  Let's expose the frauds where they exist.  Let
       the chips where they may.
 
       Let's get patents in the hands of the inventors
       cheaply, efficiently, without forcing them to go through the
       harassment and problems of patent persecution.
 
       Let's get the cases allowed quickly.  But we must
       have a fixed term that expires at a certain date.  The U.S.
       Congress itself, in a predecessor to 35 U.S.C. 102(d),
       enacted a law that capped U.S. patent terms under certain
       circumstances to expire as of the earliest counterpart
       foreign patent expiration date.
 
       The idea is, at some point in time, there will be
       a generic industry.  If there is a generic industry, there
       will be a generic industry, let that be in the United States
       and not abroad.
 
       There is a case called Ex Parte Mushettes
       application, where one of your predecessors, about 124 years
       ago, 125 years ago, denied a patent extension in one case
       because he said that if he granted an extension of steel
       making process patent in the United States, the patent had
       already expired in the United Kingdom, and then all generic
       competition would go abroad.  Steel would be made abroad,
       instead of here at home.
 
       Isn't that crazy?  Isn't that anti-American?
 
       So let's honor the Constitution, let's strengthen
       the patent system, and let's proceed with the simplification
       of the system.  And I applaud your legislative and
       rulemaking initiatives. 
 
       Thank you very much for your time.  Do you have
       any questions, sir?
 
       [No response.]