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January 23, 1947

OOMS, Commissioner of Patents. DORSEY v. SAME. CARTER v. SAME

The opinion of the court was delivered by: MORRIS

These proceedings were brought in this Court pursuant to Section 11, Title 35 U.S.C.A., and Rule 95, Title VIII of the Rules of this Court to review Orders Nos. 3937, 3938 and 3939 of Conway P. Coe, Commissioner of Patents, all dated May 18, 1945, disbarring from practice before the United States Patent Office for gross misconduct the petitioners Henry W. Carter, Vernon M. Dorsey and Roswell F. Hatch, respectively. The respondent in these proceedings here is the successor in office to the Commissioner of Patents whose action is sought to be reviewed. Upon motion of each petitioner, the order of disbarment was stayed by orders of this Court entered the 16th day of July 1945 pending review and final determination by this Court. By stipulation Volumes I, II and III of the printed record, containing testimony and printed exhibits, and numerous other exhibits, together with briefs of counsel, transcript of arguments of counsel, a photostat copy of report of Committee on Enrollment and Disbarment, opinion of Commissioner and copy of orders of disbarment were transmitted to this Court in lieu of a formally certified record of the proceedings in the Patent Office. Argument on the petitions for review commenced February 4, 1946, and consumed five days. Prior to arguments briefs for all parties were submitted and subsequent to the arguments a transcript thereof was received by the Court.

The proceedings in the Patent Office were initiated by a rule to show cause, directed to each of the petitioners, which read as follows:

 'Whereas it was found by the Supreme Court of the United States in its decision in the case of Hazel-Atlas Glass Company v. Hartford-Empire Company, 1944, 322 U.S. 238, 64 S. Ct. 997, 88 L. Ed. 1250, that fraud was practiced on the United States Patent Office during the prosecution of the patent application of Karl E. Peiler, No. 294792, which matured into patent No. 1,655,391 on January 3, 1928, which fraud consisted in the preparation and presentation to the United States Patent Office of an article entitled 'Introduction of Automatic Glass Working Machinery; How Received by Organized Labor,' naming one William P. Clarke as the author, who in fact was not the author of said article, and

 'Whereas it appears from said decision and the record of the case before the Supreme Court, and the record before the United States Circuit Court of Appeals, Third Circuit, in the case of Hartford-Empire Company v. Hazel-Atlas Glass Company, 137 F.2d 764, and the record before the District Court, Northern District of Ohio, West. Div., in the case of United States v. Hartford-Empire Company, 46 F.Supp. 541, and the records of the Patent Office, that you participated in the preparation of said article and/or the presentation thereof to the United States Patent Office during the prosecution of said patent application knowing that said article was not written by said William P. Clarke, and with the purpose of deceiving the Patent Office as to the authorship of said article and influencing the action of the Patent Office on said application; and that you thereby perpetrated or participated in the perpetration of a fraud on the United States Patent Office.

 'Now therefore, you are hereby ordered to show cause on or before November 9, 1944, why, in view of the above, you should not be suspended or excluded from further practice before the United States Patent Office for gross misconduct.

 'You are hereby notified that a hearing on this order to show cause will be accorded to you before the Committee on Enrollment and Disbarment of the United States Patent Office on November 9, 1944 in Room 1035 of the United States Patent Office in the Department of Commerce, 14th and E Streets, N.W., Washington, D.C., beginning at 10:00 A.M. on said date.'

 In addition to the three petitioners in these proceedings, who were designated as respondents in the proceedings in the Patent Office, there was another respondent, Robson D. Brown, who is now deceased.

 A hearing was had before the Committee on Enrollment and Disbarment of the Patent Office, consisting of seven members, such hearing commencing November 21, 1944, and consuming five days with one night session. Each of the respondents were represented by counsel, excepting Mr. Vernon M. Dorsey, who appeared pro se. On March 27, 1945, oral argument was heard by the Committee, with Commissioner Conway P. Coe attending. The Committee, in its report to the Commissioner of Patents, dated April 26, 1945, which discussed much of the evidence in the case and set out many excerpts therefrom, stated (all members agreeing):

 'As is clear from what has been stated in this report, it is our carefully considered opinion that the record made before us indubitably and conclusively shows and establishes that the respondents and each of them has been guilty of gross misconduct toward the Patent Office in connection with the so-called Clarke article, the most salient points of said misconduct being: First, the preparation and the presentation of the article to the Patent Office in such manner as to induce the Patent Office officials to believe that the article compared the commercial success of the specific invention of the Peiler application with the commercial success of the Owens machines, whereas, in truth, the comparison was of the commercial success of gob feeding machines in general -- of which there were several types other than Peiler's -- with the commercial success of the Owens machines; and, Secondly, the deliberate concealment from the Patent Office of the facts that (a) the so-called Clarke article was prepared by and on behalf of Hartford; (b) that the sponsorship of the article by Clarke and the notation thereon of Clarke's name as author was procured by and on behalf of Hartford, and (c) that the publication of the article in the National Glass Budget was procured by Hartford and on its behalf through Hatch. We hold and believe that in the perpetration of such concealment all of the respondents deliberately collaborated not only with each other but also directly or indirectly with Clarke, and that all of the respondents connived with each other with the intention of misleading and deceiving the officials of the Patent Office as to the true state of the said material facts concerning the connection of Hartford with the preparation and publishing of the article with Clarke's name appearing thereon as the author thereof, when in fact he was not the true author thereof, and all this for the purpose of securing favorable action by the Patent Office with respect to the claims in the Peiler application.'

 In its recommendation five members recommended disbarment and two members recommended that'respondents be not disbarred perpetually from practice before the Patent Office but that instead respondents and each of them be suspended from practice for a definite period of time, for instance, up to one year.' The Commissioner of Patents on May 18, 1945, addressed the following memorandum opinion to all counsel and to Mr. Dorsey, who had appeared pro se:

 'An order to show cause why he should not be disbarred from practice before the United States Patent Office was issued against each of the above named respondents. Answers were filed and a hearing had before the Committee on Enrollment and Disbarment of the Patent Office, at which time testimony and exhibits were introduced by the respondents. The Committee has made its report to me and in the report a majority of the Committee has recommended that all of the respondents be disbarred from practice before the Patent Office. A copy of the report is transmitted herewith.

 'That a fraud was practiced on the Patent Office, as charged in the orders to show cause, was found by the Supreme Court of the United States in the case of Hazel-Atlas Company v. Hartford-=empire Co., 322 U.S. 238, 64 S. Ct. 997, 88 L. Ed. 1250, which was a suit to set aside the judgment of the Court of Appeals for the Third Circuit sustaining the validity of the Peiler patent No. 1,655,391, which was granted on the Peiler application referred to in the orders to show cause.

 'In its Opinion in that case the Supreme Court said:

 "Here even if we consider nothing but Hartford's admission, we find a deliberately planned and carefully executed scheme to defraud not only the Patent Office but the Circuit Court of Appeals.'

 'I have given careful consideration to the Committee's report and to the entire record made at the hearing and I am convinced that each of the above named respondents participated in the scheme to defraud the Patent Office, as was found by the Committee, and I approve the recommendation of the majority of the Committee, that each of the respondents be disbarred from further practice before the United States Patent Office. Orders of disbarment have this day been issued.'

 Each of the petitioners here assigned a great many errors, all of which have been carefully considered. It would enlarge this opinion beyond reasonable limits to undertake to deal separately with each of such assigned errors. I shall undertake to discuss such matters as have been pressed in the briefs and oral arguments which seem to me necessary in the proper disposition on review of these proceedings.

 At the outset it is of first importance to make clear the function of this Court in the present proceedings. It is not that of the trier of the facts; it is to review what has been done in the disbarment proceedings and to determine whether or not the petitioners have had a fair hearing after due notice of the charge each was called upon to answer, and whether or not there is substantial evidence to support the action of the Commissioner of Patents.

 Each of the petitioners contended that improper consideration was given to the several decisions and records in the cases mentioned in the rules to show cause, in which they were not parties. I am in complete agreement with the proposition that they cannot be found guilty of gross misconduct upon any evidence in any of such cases unless such evidence has been properly admitted in evidence in these proceedings. The critical part of the evidence found in the records of the other cases and introduced into evidence in the present proceedings consists of communications written or received by the several petitioners, and as to such communications it has been conceded that they were written by the persons by whom they purport to have been written, and were received by the persons to whom they were addressed. There is, therefore, no question as to the proper admission of such communications against the writers thereof, or as showing knowledge of the matters therein contained on the part of those who received such communications. Of course, it follows that the trier of the facts could draw reasonable and legitimate inferences from these facts so established.

 Application Serial No. 294, 792, filed by K. E. Peiler in the Patent Office May 5, 1919, sought a patent for a method of and apparatus for feeding molten glass. This application, with many vicissitudes, delays and numerous interference proceedings finally eventuated in the issuance of patent No. 1,655,391, dated January 3, 1928, to the assignee Hartford Empire Company. One after the other of the patents or alleged prior claims asserted in interference with the Peiler application were acquired by the Hartford Empire Company, and such interferences were terminated, as they were no longer of an adversary nature. The question of patentability, however, remained. Accompanying an amendment, dated October 11, 1926, there was filed, among other things, an article entitled 'Introduction of Automatic Glass Working Machinery; How Received by Organized Labor, by William P. Clarke, President, American Flint Glass Workers' Union,' which had been published in the National Glass Budget, a trade publication, July 17, 1926. This article undertook to show how automatic and semi-automatic machinery had increasingly displaced skilled workers in the glass industry; how it had been the policy of the union leaders to encourage such workers to acquire skill to operate the machines which were displacing the skills which they had and thus prevent their unemployment. Excerpts from reports of its officers to the Bottle Blowers' Association constitute much of the material of the article. As the reports used the term 'Owens or automatic machines' to designate the automatic feeding accomplished by suction of molten glass into the molds and 'flowing or pouring devices' to designate all other types of automatic or semi-automatic feeding, the article deals with some emphasis on the difference between flowing or pouring devices and gob feeding. The distinction is stated in the article as follows:

 'Instead of employing a stream of glass which collects in the mold until the desired mold charge had accumulated, these new feeders cut off a suspended chunk or gob of glass which was pre-formed during suspension to correspond, to some extent, at least, to the shape of the mold cavity in which it was to be received.'

 The article states that such gob feeders had been put out by a number of manufacturers, including the Hartford-Fairmont Company, George E. Howard, Tucker and Reeves, W. J. Miller, and others. Excerpts from the reports above mentioned, as interpreted by comment in the article and shown by a chart, undertook to show that the production on gob feeders, which commenced in 1917 rose with great acceleration to the close of 1925, whereas production on Owens machines, which commenced in 1905, rose until the middle of 1919 and then leveled off.

 The evidence respecting the preparation, publication and filing of the Clarke article is voluminous. Such parts of it as appear to be critical in showing connection of the several petitioners with the preparation of said article, or with the filing thereof, and its purpose are quoted in the report of the Committee and, therefore, need not be set forth in full here. Each petitioner insists that this evidence does not show any wrongful act or intent on his part, and there is much testimony on behalf of petitioners denying any inferences drawn from such evidence that they were guilty of any misconduct in connection with the Clarke article. A discussion and correspondence was had between Brown and Carter in December 1925 with respect to the desirability of having an article describing the revolution produced in the glass business by the plunger gob feeding system. Brown suggested that such an article would be helpful in making a record before the Patent Office in connection with the principal Steimer case and also 'in our Peiler plunger case, where we hope to obtain claims covering the broad ideas of keeping suspended mold charges shaped by the action of a plunger.' He suggested that Carter write such article. Carter declined, as he did not have firsthand knowledge of the industry until 1921 and then only from the viewpoint of the patent specialist. He suggested that the article be written by Howard, who had written previous articles which were published in one of the glass journals. It is insisted in the testimony by Brown before the Committee that the article which he suggested finally became the Peiler affidavit, which dealt in detail with the various mechanical developments in the glass industry, and which was filed in the Patent Office, and had no reference to the Clarke article which was filed at the same time. In this connection, it is to be noted that Brown was resident patent counsel for Hartford and Carter was an official of the Owens Bottle Company, subsequently the Owens-Illinois Glass Company, which had a plunger licensing agreement with Hartford, whereby it had the right to use Hartofrd's feeder patents and to share in royalties from licenses.

 Hatch, who was employed by Hartford, and had charge of the Invention Department, 'which was primarily the contact between the engineers and the patent attorneys, and a number of other duties that went with it,' had a conversation 'not far from the beginning of 1926 and maybe a little before, or probably a little later' with Brown and secured authority to prepare an article which developed into the Clarke article. Both Hatch and Brown denied that at this time there was any intention to use such article, which was to be based upon reports of the Bottle Blowers' Union, in any patent proceedings. During the preparation of a draft by Hatch, he sought and received information from Carter, who in May 1926 advised the president of his company that Hatch had prepared the article 'with the idea of getting it printed under the name of some apparently unprejudiced authority and then calling the attention of the Patent Office Examiner to the article as published in the belief that the examiner will thereby be influenced to a more favorable consideration of Hartford's broad claims.' In that memorandum Carter also stated, 'Of course, we are equally interested with Hartford in securing these broad claims and, therefore, indirectly interested in getting the article published.' The intention of Hatch originally was to submit the article to a Mr. Maloney, President of the Bottle Blowers' Association to sponsor it for publication, but when Mr. Maloney declined on the ground that it might involve him with other glass manufacturers, Hatch sought to secure such sponsorship by Clarke, President of the American Flint Glass Workers' Union. Clarke would not agree unless the Owens Company, which he did not wish to offend, was agreeable thereto. In the memorandum of May 25, 1926, above referred to, Carter advised agreement with the article so that it would be sponsored by Clarke. Clarke was later advised that the Owens Company had no objection, and he agreed to go over the article, make such changes as he thought necessary, and sign it for publication.

 Hatch emphatically denies that he had ever told Carter that the article prepared by him was for the purpose stated in Carter's memorandum, and Carter in his testimony admits that he has no recollection that Hatch did so, and probably had the understanding about its purpose which he did from the correspondence which he had originally had with Brown. Hatch did, however, write to Carter on March 30, 1926, in which letter, among other things, he stated that he was enclosing a carbon copy of the article which he had been preparing for publication and:

 'The latest idea we have here is to persuade Mr. Maloney, the president of the Bottle Blowers' Association, to sponsor this article. I have become fairly well acquainted with him, and I think there is a reasonable chance that he will do as we wish. Of course, we do not care who assumes the authorship of the article, but we want some one not associated in any way with either of our companies, and whose name would carry some slight weight in the glass trade.'

 'The point I have in mind is that, if I can get the president of the association to publish this, I thought that he should base all of his statements on their printed records, except where such statements had a direct ...

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