William Howard Taft

“ The extent of his monopoly in the articles sold and in the territory of the United States where sold is not limited in the grant of his patent, and the comprehensiveness of his control of the business in the sale of the patented article is not necessarily an indication of illegality of his method. As long as he makes no effort to fasten upon ownership of the articles, he sells control of the prices at which his purchaser shall sell, it makes no difference how widespread his monopoly. ”

“ Conveying less than title to the patent or part of it, the patentee may grant a license to make, use, and vend articles under the specifications of his patent for any royalty, or upon any condition the performance of which is reasonably within the reward which the patentee by the grant of the patent is entitled to secure. It is well settled, as already said, that where a patentee makes the patented article, and sells it, he can exercise no future control over what the purchaser may wish to do with the article after his purchase. ”

“ The agents under the second class are called B agents, and the agents under the third class are called A agents. Each B agent is appointed by the General Electric Company by the execution and delivery of a contract for the appointment, which lasts a year from a stated date, unless sooner terminated. It provides that the company is to maintain on consignment in the custody of the agent a stock of lamps, the sizes, types, classes, and quantity of which and the length of time which they are to remain in stock to be determined by the company. ”

“ The question is whether, in view of the arrangements made by the company with those who ordinarily and usually would be merchants buying from the manufacturer and selling to the public, such persons are to be treated as agents or as owners of the lamps, consigned to them under such contracts. If they are to be regarded really as purchasers, then the restriction as to the prices at which the sales are to be made is a restraint of trade and a violation of the Anti-Trust Law. ”

“ There is no evidence that any purchaser from the company or any of its agents is put under any obligation to sell at any price, or to deal with the lamps purchased except as an independent owner. The circumstance that the agents were in their regular business wholesale or retail merchants, and under a prior arrangement had bought the lamps and sold them as their owners, did not prevent a change in their relation to the company. ”

“ The agent guarantees the return to the company of all unsold lamps in the custody of the agent within a certain time after the termination of his agency. The agent is to pay over to the company not later than the 15th of each month an amount equal to the total sales value, less the agent's compensation, of all of the company's lamps sold by him-that is, first, of the collections that have been made ”

“ There are 400 of the B agents, the large distributors. They recommend to the company efficient and reliable distributors in the localities with which they are respectively familiar, to act as A agents, whom the company appoints. There are 21,000 or more of the A agents. ”

“ A combination of manufacturers owning a patent to make float spring tool harrows licensed others to make and sell the products under the patent on condition that they would not during the continuance of the license sell the products at a less price or on more favorable terms of payment and delivery to purchasers than were set forth in a schedule made part of the license. ”

“ There is no conflict in the agent's obligation to account for all lamps lost, missing, or damaged in the stock. It is only a reasonable provision to secure his careful handling of the goods intrusted to him. ”

“ The licensee in such a case acquires an interest in the articles made. He owns the material of them and may use them. But if he sells them he infringes the right of the patentee, and may be held for damages and enjoined. ”

“ The bill made two charges, one that the General Electric Company, in its business of making and selling incandescent electric lights, had devised and was carrying out a plan for their distribution throughout out the United States by a number of socalled agents, exceeding 21,000, to restrain interstate trade in such lamps and to exercise a monopoly of the sale thereof ”