general electric argued october decided november attorney general james fowler knoxville charles neave new york city general electric fred wood new york city westinghouse electric mfg chief justice taft delivered opinion bill equity brought district northern district ohio enjoin general electric company westinghouse electric manufacturing company westinghouse lamp company violation act july stat comp bill made two charges one general electric company business making selling incandescent electric lights devised carrying plan distribution throughout number socalled agents exceeding restrain interstate trade lamps exercise monopoly sale thereof second achieving illegal purpose contract license defendants westinghouse electric manufacturing company westinghouse house lamp company westinghouse lamp company corporation whose stock owned westinghouse electric manufacturing company selling agent may treat two one reference hereafter defendants general tric company shall call electric company westinghouse company government alleged system distribution adopted merely device enable electric company fix resale prices lamps hands purchasers agents fact wholesale retail merchants lamps passed ordinary channels commerce ordinary way restraint unlawful agents avowed purchasers handling lamps resale price agreements electric company answered distributors bona fide agents legal right market lamps pass directly consumer agents prices system prescribed agreed upon agents limitation sought resale prices upon purchased agents second question case involves validity license granted march electric company westinghouse company make use sell lamps patents owned former charged license effect provided westinghouse company follow prices terms sale time time fixed electric company observed westinghouse company regard lamps manufactured license adopt maintain conditions sale observed electric company distribution lamps manufactured district upon full hearing dismissed bill want equity appeal section act february known expediting act stat comp prior litigation three defendants porations government sued dissolve illegal combination restraint interstate commerce electric lamps violation act enjoin violation consent decree entered cause combination dissolved subsidiary corporations surrendered charters properties taken general electric company defendants enjoined fixing resale prices purchasers except owner patents permitted fix prices licensee sell lamps manufactured patent decree entered new sales plan one complained submitted attorney general attorney general declined express opinion legality plan adopted operation since government insists circumstances tend support government view new plan mere evasion restrictions decree intended carry evil result condemned prior litigation really conflict testimony sense variation facts difference inference drawn therefrom evidence included stipulation certain facts certain witnesses defendants testify written contracts license agency made general electric company westinghouse company general electric company owner three hanaman basic patent use tungsten filaments manufacture electric lamps coolidge patent covering process manufacturing tungsten filaments tensile strength endurance greatly increased third langmuir patent use gas bulb intensity light substantially heightened three patents cover completely making modern electric lights tungsten filaments secure general electric company monopoly making using vending total business electric lights year relative percentages business done companies general electric per cent westinghouse per cent licensees per cent manufacturers licensed per cent plan distribution electric company divides trade three classes first class sales large consumers readily reached general electric company negotiated salaried employees deliveries made factories warehouses second class sales large consumers contracts general electric company negotiated agents deliveries made stock custody agents third sales general consumers agents similar contracts agents second class called agents agents third class called agents agent appointed general electric company execution delivery contract appointment lasts year stated date unless sooner terminated provides company maintain consignment custody agent stock lamps sizes types classes quantity length time remain stock determined company lamps consigned agents kept respective places business may readily inspected identified company consigned stock part returned company may direct agent keep account books records giving complete information dealings tion company lamps consigned stock remain property company lamps sold proceeds lamps held trust benefit account company fully accounted agent authorized deal lamps consignment three first distribute lamps company agents authorized company second sell lamps stock consumer extent requirements immediate delivery prices specified company third deliver lamps stock purchaser written contract company agent may authorized company deliver lamps prices terms stated contract agent authority dispose lamps except provided control attempt control prices purchaser shall sell lamps agent pay expenses storage cartage transportation handling sale distribution lamps expenses incident thereto accounting therefor collection accounts created transportation include freight lamps consignment company agent agent guarantees return company unsold lamps custody agent within certain time termination agency agent pay company later month amount equal total sales value less agent compensation company lamps sold first collections made second customers accounts past due comply guaranty agent due prompt payment lamps sold stock third agent pay company value company lamps lost missing damaged stock custody basic rate commission payable agent certain special supplemental additional compensations prompt efficient service agent becomes insolvent fails make reports remittances fails obligations appointment may terminated terminated either end year otherwise consigned lamps remaining unsold delivered manufacturer appears evidence since although specific agreement effect company assumed risk fire flood absolescence price decline carries whatever insurance carried stocks lamps hands agents pays whatever taxes assessed relevant circumstances confirm view relation agent company real one agents large distributors recommend company efficient reliable distributors localities respectively familiar act agents company appoints agents usually retail electrical supply dealers smaller places sales agent authorized make consumers immediate delivery purchasers written contract manufacturer case agents plan course devised purpose enabling company deal directly consumers purchasers doubtless intended avoid selling lamps owned company jobbers dealers prevent sale middlemen consumers different competing prices question whether view arrangements made company ordinarily usually merchants buying manufacturer selling public persons treated agents owners lamps consigned contracts regarded really purchasers restriction prices sales made restraint trade violation law find nothing form contracts practice makes agents anything genuine agents company delivery stock agent anything consignment agent custody sale obliged pay money stock held sold guarantees account made must turn paid whether gets term occurs frequent form pure agency known sale del credere commission conflict agent obligation account lamps lost missing damaged stock reasonable provision secure careful handling goods intrusted find nothing agreement pay expense storage cartage transportation except freight original consignment handling sale distribution lamps inconsistent relation agent expense course covered amount fixed commission agent power deal lamps way inconsistent retained ownership lamps company delivered purchasers title passes directly company purchasers evidence purchaser company agents put obligation sell price deal lamps purchased except independent owner circumstance agents regular business wholesale retail merchants prior arrangement bought lamps sold owners prevent change relation company find reason record hold change case good faith actually maintained said system distribution complicated involves large number agents distributed throughout entire country size comprehensiveness scheme brings within law question suit act circumstance combination effected secures domination large part business affected control prices usually important proof monopoly violating act patent law patentee given statute monopoly making using selling patented article extent monopoly articles sold territory sold limited grant patent comprehensiveness control business sale patented article necessarily indication illegality method long makes effort fasten upon ownership articles sells control prices purchaser shall sell makes difference widespread monopoly adopts combination others steps scope patent rights seeks control restrain sold patented articles subsequent disposition comes within operation act validity electric company scheme distribution electric lamps turns therefore question whether sales company agents consumer fact company agents time consignment distinction law fact agency sale clear reasons already stated find ground inference contracts made company agents intended language makes government relies contention different conclusion case dr miles medical john park sons case bill equity brought miles medical company enjoin park sons company continuing alleged conspiracy number wholesale retail dealers proprietary medicines induce persons entered certain agency contracts number country break contracts agency medical company great injury company agency concerned sale proprietary medicines prepared secret methods formulas identified distinctive packages company extensive trade throughout certain foreign countries practice sell medicines jobbers wholesale druggists turn sold retail druggists sale customer fixed price sales jobbers wholesale dealers also prices jobbers small dealers defendants inaugurated rate cutprice system caused great damage complainants business injuriously affected reputation depleted sales remedies bill demurred ground methods set forth bill attempt made control sales prices consumers illegal common law act deprived bill equity issue considered plan distribution miles medical company resembled many details plan distribution present case except medicine secret formula patented article certain vital differences led circuit appeals declare language contracts agency false purport merely used conceal really sales agents conclusion sustained certain allegations bill inconsistent contracts agency effect medical company sell agents medical packages consigned however without reference telltale allegations bill found contracts operation plain provision purchases agents necessarily made contracts indefinite amount consignments contracts sale rather agency therefore held showing made attempt miles medical company plan distribution hold purchasers purchase full price obligation maintain prices resale whole effect miles medical case made plain case boston store american graphophone ed ann cas chief justice white reviewed various cases general subject spoke miles medical case follows dr miles medical park sons decided general law owner movables case proprietary medicines compounded secret formula sell movables lawfully contract fix price product afterwards sold one time sell retain part yet hold project seller cause control movable parted subject owned another thus make seller unwarrantedly take place law land movables decided power make limitation price future exerted consistently prohibitions restraint trade monopoly contained law case standard sanitary manufacturing sustain contention government first question number manufacturers one owned patent enameled iron ware plumbing fixtures made combination accept licenses make patented commodities sell interstate trade jobbers refuse sell jobbers agree maintain fixed prices sales plumbers attempt like miles medical case control trade articles sold fasten upon purchasers nad bought full price complete owners obligation maintain resale prices opinion therefore nothing matter principle authorities requires us hold genuine contracts agency like us however comprehensive mass whole effect violations act owner article patented otherwise violating common law act seeking dispose articles directly consumer fixing price agents transfer title directly consumer first charge bill sustained second electric company owner patents entirely controlling manufacture use sale tungsten incandescent lamps license westinghouse company right impose condition sales prices fixed licensor subject change according discretion contention also made license required westinghouse company conform matter prices might vend patented articles also follow plan already explained electric company adopted distribution appear provision express license plan set therein even construction urged government correct think result must owner patent may assign another convey exclusive right make use vend invention throughout undivided part share exclusive right exclusive right patent within specific part assignment transfer short one license giving licensee title patent right sue law name infringement waterman mackenzie gayler wilder moore marsh wall crown nye tool works conveying less title patent part patentee may grant license make use vend articles specifications patent royalty upon condition performance reasonably within reward patentee grant patent entitled secure well settled already said patentee makes patented article sells exercise future control purchaser may wish article purchase passed beyond scope patentee rights adams burks wall bloomer mcquewan mitchell hawley wall hobbie jennison keeler standard folding bed question different one arises consider patentee grants license one make vend patented article may limiting licensee exercise right sell patentee may make grant license another make use patented articles withhold right sell licensee case acquires interest articles made owns material may use sells infringes right patentee may held damages enjoined patentee goes licenses selling articles may limit selling limiting method sale price think may provided conditions sale normally reasonably adapted secure pecuniary reward patentee monopoly one valuable elements exclusive right patentee acquire profit price article sold higher price greater profit unless prohibitory patentee licenses another make vend retains right continue make vend account price licensee sell necessarily affect price sell patented goods seem entirely reasonable say licensee may make sell articles patent destroy profit wish obtain making selling thereby sell outright licensee articles latter may make sell vest absolute ownership restricts property interest licensee goods makes proposes sell question considered case bement national harrow combination manufacturers owning patent make float spring tool harrows licensed others make sell products patent condition continuance license sell products less price favorable terms payment delivery purchasers set forth schedule made part license held valid use patent rights owners patent objected made monopoly speaking justice peckham said page object laws monopoly rule exceptions conditions nature illegal regard kind property imposed patentee agreed licensee right manufacture use sell article upheld courts fact conditions contracts keep monopoly fix prices render illegal speaking contract said page provision regard price licensee sell article manufactured license also appropriate reasonable condition tended keep price implements manufactured sold recognizing nature property dealt providing value far possible parties legally entitled owner patented article course charge price msy choose owner patent may assign sell right manufacture sell article patented upon condition assignee shall charge certain amount article question case came writ error appeals new york raised federal issue whether contract license kind wide operation sales harrows invalid violation law held argued however bement national harrow effect overruled claim based fact one cases cited justice peckham case fastener eureka specialty decision circuit appeals sixth circuit opinion written circuit judge lurton afterwards justice question considered whether owner patent machine fastening buttons shoes metallic fasteners might sell machines subject condition used fasteners manufactured seller patented machine revert breach condition purchaser machine held licensee use unpatented fasteners contrary condition breach contract license infringement patent monopoly similar case came reported henry dick ann cas opinion also delivered justice lurton case complainant sold patented machine embodying invention called mimeograph claims patent embrace ink materials used working upon machine however inscribed notice styled license restriction reciting machine might used stencil paper ink supplies made dick company henry company dealers ink sold purchaser use working machine ink made dick company held majority use ink purchaser prohibited use rendered liable action patent law infringement seller ink liable contributory infringer case overruled motion picture patents universal film ann cas patent case covered part mechanism used motion picture exhibiting machines feeding film machine regular uniform accurate movement expose film excessive strain west license agreement contained covenant part licensee every machine sold sold restriction condition exhibiting projecting machines used solely exhibiting projecting motion pictures motion picture patents company overruling dick case based ground grant patent exclusive right use mechanism produce result appropriate material materials pictures upon machine operated part patented machine combination produced patented result overruling dick case disapproval fastener case motion picture film case carry overruling bement harrow co case cited case bement harrow sustain decision fortiori argument ruling former case much broader needed decision latter price patented article sells certainly circumstance direct relation germane rights patentee unpatented material patented article may used indeed already said price fixing usually essence secures proper reward patentee think decisions holding restrictions price patented articles invalid apply contract license like one case cases boston store american graphophone ann cas straus victor talking machine ann cas bauer ann cas standard sanitary manufacturing straus cases really instances application principle adams burks wall already referred patentee may attach article made consent condition running article hands purchasers limiting price one becomes owner full consideration shall part consider condemn restriction put patentee upon licensee prices latter shall sell articles makes make legally license authority bement harrow shaken cases reviewed reasons given sustain validity license granted electric company westinghouse company decree district dismissing bill affirmed