Stanley Forman Reed

“ Furthermore, even though defendants had no substantial evidence to overcome the prima facie conclusion of Sherman Act violation, they had the right to lay facts before the court that were pertinent to the court's decision on the terms of the decree; for example, the purpose of the concerted action, or the reason for making new patents available to the licensees, or willingness to license all applicants for the patent privilege. Such rights, however, did not require the trial court to admit evidence that would not affect the outcome of the proceedings. ”

“ Defendants offered to prove that royalties based on unpatented gypsum board were compensation for patent licenses and installment payment for prior infringement damages. Such proof would not affect the fact that such a royalty added to the cost of producing unpatented board.
Proof was offered that covenants against transfer of licenses, for price maintenance and for equality of license terms, and bulletin orders against rebates by selling other products at a cheaper price when patented articles were sold, were to protect the licensor's monopoly under its letters patent. ”

“ Defendants' offer of proof did not deny such effort to systematize sales. Their explanation was that the efforts were to enforce legitimate license agreements and were not calculated steps in conspiracy or monopoly. We think the Government's request that the decree's injunctions reach gypsum products, as defined in its proposed decree, is reasonable and should be allowed. See U.S. proposed decree, Article II, § 4, and Article V.
(d) The Government asks that the decree forbid standardization of trade practices through concerted agreement. ”

“ Notwithstanding our adherence to trial court responsibility in the molding of a decree as the wisest practice and the most productive of good results, we have never treated that power as one of dsicretion, subject only to reversal for gross abuse. ”

“ It seeks to extend the injunctions against violations of the Sherman Act to cover gypsum products instead of being limited to gypsum board as defined in the decree; and to include clude interstate commerce generally instead of limiting the territorial scope of the decree to the eastern portion of the United States. It also seeks changes that forbid specific practices, in addition to price fixing, such as standardizing products, classifying customers, or adopting delivered price systems, all pursuant to the principal conspiracy. ”

“ A full exposition is impracticable. Stress was laid on the available evidence to rebut our finding of an industry plan to stabilize prices. [6] Evidence was offered to show the licenses were for settlement of alleged infringements, and individual in character and were not used as a subterfuge to gain price control. Such evidence would not affect our determination, set out above, that price-fixing licenses made in knowing concert by standardized price requirements violated the Sherman Act by their very existence. ”

“ We think that the United States Gypsum Company should be required to license all its patents in the gypsum products field to all applicants on equal terms. Whether the term for compulsory licensing of new patents is to be five years, or for a longer period with the privilege to the appellees to move for a limitation for such new patents, as provided in the suggested decree, Art. ”

“ Good intentions, proceeding under plans designed solely for the purpose of exploiting patents, are no defense against a charge of violation by admitted concerted action to fix prices for a producer's products, whether or not those products are validly patented devices. ”

“ Thereafter counsel for plaintiff and counsel for certain of the defendants submitted forms of final decrees for the consideration of the Court and also suggested findings of fact, the latter to be considered in the event the Court should deem it necessary to make any findings of fact additional to those originally found by it and to those stated in the opinion of the Supreme Court. ”

“ The Government accepts the finding of Article III of the decree but objects to Article V (2) and (3) because, read together, they allow agreements through price fixing by license between United States Gypsum and Pacific Coast licensees. The complaint of Sherman Act violation was restricted to the eastern territory of the United States. The evidence applied only to that area. ”

“ United States, 326 U.S. 1, 22, 65 S.Ct. 1416, 1425, 89 L.Ed. 2013; cf. International Salt Co. v. United States, 332 U.S. 392, 399-401, 68 S.Ct. Ct. 12, 16-17, 92 L.Ed. 20. And see United States v. Crescent Amusement Co., 323 U.S. 173, 185, 65 S.Ct. ”