Hobbs v. United States Atomic Energy Commission
Decision Date | 20 December 1971 |
Docket Number | No. 30159.,30159. |
Citation | 451 F.2d 849,171 USPQ 713 |
Parties | James C. HOBBS, Petitioner, v. UNITED STATES of America, ATOMIC ENERGY COMMISSION, Respondent. |
Court | U.S. Court of Appeals — Fifth Circuit |
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Richard B. Montgomery, Jr., New Orleans, La., B. D. Watts, Cleveland, Ohio, H. Struve Hensel, New York City, for petitioner.
William D. Ruckelshaus, Asst. Atty. Gen., Robert V. Zener, Atty., Dept. of Justice, Washington, D. C., Joseph F. Hennessey, Roland A. Anderson, Asst. Gen. Counsel, John A. Horan, Atomic Energy Comm., John N. Mitchell, Atty. Gen., Morton Hollander, Chief, Appellate Section, Dept. of Justice, Alan S. Rosenthal, Atty., Dept. of Justice, Washington, D. C., for the United States.
Before WISDOM, BELL, and AINSWORTH, Circuit Judges.
This appeal concerns a claim against the government for just compensation for the Atomic Energy Commission's allegedly unlawful taking of James C. Hobbs's rights in certain inventions essential to the production of The Bomb. The matter is before this Court for the second time.
The gas involved in the production of fissionable material had never before been producd in quantity. It was highly corrosive. It had to be handled at subatmospheric pressure. Its mixture with moist air or grease would render it highly dangerous. The valves required had to be leakproof. Each valve of the thousands used on miles of pipe had to meet the unheard-of test of resisting leakage of air sufficient to increase the pressure in the pipe a micron of mercury, equivalent to one atmosphere increase in over eighty years. No known valve was suitable for Oak Ridge. James C. Hobbs had the inventive ability to design valves that proved to be suitable. They were vital to the war effort and may have greater value in developing peaceful uses for nuclear fission.
On December 14, 1942, the federal government contracted with M. W. Kellogg Company for Kellogg to design and build a plant at Oak Ridge, Tennessee, for the production of fissionable material for the world's first nuclear weapons. The government entered into a similar contract with Kellex Corporation, a subsidiary incorporated for purposes of the contract. On June 25, 1943, the United States contracted with Crane Company for Crane to manufacture valves and fittings required for the gaseous diffusion plant under the direction and supervision of Kellex.
James C. Hobbs, a mechanical engineer who had several inventions to his credit, agreed to work for Kellex as a part-time general consultant on September 9, 1943. Although Kellex's contract with the government required it to assign rights to all patentable discoveries over to the government and to secure patent waiver forms from all employees, Hobbs, at the time of his initial employment, and repeatedly thereafter, refused to waive or assign any patent rights he might have. The government was so informed on March 3, 1945.
Although the exact urgency of the situation existing at Oak Ridge in the fall of 1943 is unclear, it appears that development of a gate valve (G valve) was essential to the completion of the project. At a conference held in Chicago on November 4-6, 1943, Hobbs first submitted a design for the G valve. He was soon given full responsibility on behalf of Kellex for the work on the development of special valves to be used at Oak Ridge including the G valve and instrument valve (H valve). The design for the G valve was eventually frozen about January 1, 1944, and the design for the H valve was approved sometime during June 1944. Hobbs developed both in cooperation with the employees of Crane.
On February 15, 1945, Hobbs filed an application for a patent on the G valve. After prolonged negotiations between Hobbs and the Patent Office, the Office issued Hobbs Patent No. 2,520,364 on August 29, 1950. On March 26, 1946, Hobbs filed an application for a patent on the H valve. The Patent Office issued Patent No. 2,617,621 on this valve on November 11, 1952.
The Oak Ridge plant was equipped with over five thousand G valves and over 51,000 H valves made by Crane. Three additions were later made to the Oak Ridge plant and additional plants were built at Paducah, Kentucky and Portsmouth, Ohio. A version of the G valve furnished by M. L. Bayard Company and the Linde Company was employed in the new plants. A version of the H valve for use in the new plant was furnished by Hoke Incorporated and Fulton-Sylphon Control Division of Robertshaw-Fulton Controls Company. G valves purchases from Crane amounted to $6 million and H valve purchases $500,000. $19 million worth of Bayard and Linde G valves and $300,000 worth of Hoke and Fulton-Sylphon H valves were purchased between 1949 and 1955.
The present proceedings were commenced on October 9, 1956, when Hobbs filed an application with the Patent Compensation Board of the Atomic Energy Commission for compensation under the Atomic Energy Act of 1946, 42 U.S.C. § 1801 et seq. (1952 ed.), 60 Stat. 755 et seq. (1946), seeking compensation for the alleged taking and use by the government of the valves described in the G valve and H valve patents issued to Hobbs. The Board denied compensation and the Commission refused review. In re Hobbs, 136 U.S.P.Q. 489 (1963). The Board held "that the inventions of Applicant Hobbs were made under such circumstances and conditions as would give to the Government, through its contract with the Kellex Corporation, shop rights." Id. at 496-497. This Court reversed the Commission and remanded the case. Hobbs v. United States, 5 Cir. 1967, 376 F.2d 488. The Board held additional hearings, and again denied compensation. In re Hobbs, 165 U.S.P.Q. 99 (1970). The Commission adopted the opinion of the Board. The Board's opinion contains 108 separate findings of fact, some self-contradictory both as to the standards applied and the results reached. Its "Conclusions of Law", however, are succinctly stated:
Id. at 145. Hobbs's petition for review is before this Court under Section 189 (b) of the Atomic Energy Act of 1954, 42 U.S.C. § 2239(b), directing review in accordance with 28 U.S.C. §§ 2341-2352 and 5 U.S.C. §§ 701-706.
Although the case is here for review under the 1954 Act, the substance of Hobbs's claims is governed by the 1946 Act.1 Hobbs v. United States, 5 Cir., 1967, 376 F.2d 488. See also N. V. Philips' Gloeilampenfabrieken v. Atomic Energy Commission, 1963, 114 U.S.App. D.C. 400, 316 F.2d 401; Anderson v. United States Atomic Energy Commission, 7 Cir. 1963, 313 F.2d 313. The key provisions of the 1946 Act drastically limited the patentability of inventions used in the production of atomic energy:
60 Stat. 768.2 Section 11(d) provides for the Commission's acquisition of patents:
(d) Acquisition of Patents. — The Commission is authorized to purchase, or to...
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