The Providence news. (Providence [R.I.]) 1891-1906, 1894-12-22
THE TELEPHONE PATENTS.

III Woulu De Impossible tOpresent more
strongly the need Of thorough over
hauling of the patent Office, the patent
laws and the patent Office methods,
than it is presented in the decision of
Judge CARPENTER on the famous.Bell
Telephone case, which was rendered a
few days ago.
The decision was that what is known
as the " Berliner patent" is void because
1T is identical with the former patents
under which the Bell Company has
operated. The Bell Company owned the
Berliner patent, and had delayed its
issuance by multiplicity of legal
bubbles, intending to have it issued at
about the time the other patents ex-
pired, 80 that the Bell Telephone Conn
pany would be given monopoly In the
telephone business twice as long as the
patent laws contemplate.
The Berliner patent was issued in
1891, and the Government has been en-
deavoring to have it annulled ever since.
OhtbC Shhi EN- = dCtiSlOi 10 WI Al
reading, as it sets forth, with vigorous
and luminous language, the
methods by which this great
monopoly has fastened itself upon
the people and is bleeding them for its
own benefit. Some idea Of the fake
character of the Berliner patent, and
the gross colusion of the patent office,
may be gained by noting brief para
graph in Judge CARPENTERS decision.
The whole apparatus is shown in the draw
ings Of both patents, and is identically the
same -4H--beth, Fhu- trHuymftters -Eud
the receivers arc identical, I'm form.
and differ in function according as they
are placed at the transmitting, or at the re-
ceiving. end of the telephone wire. IL. there
fore, appears thai one of the functions OF the
device shown in the patent OF 1880, namely:
the function OF transmitting ar
ticulate speech. is identical with the sole
object or function OF the device covered by
the patent OF 1891, and that the device for
effecting the transmission is identical IN buth
patents. The patent therefore seems 10
me TO be void and beyond tue power of the
Solnm lssIoher 10 issue.
This decision ought to clear the field
for telephone competition, and it is to be
hoped that such competition will arise,
and that it will be of sufficient vigor to
force the BELL people down to a
reasonable basis. 1t lis instructive
to rehearse some of the main facts in the
financial history OF the Bell company,
which was organized in 1880 with an
authorized capital of $40 0,O00,0 900, Of
which S6,5c0, 600 was issued. This was
increased to s., $50, 600 by giving ri ght to
the National Bell Telephone Company
stock at par. From that day until re-
Gently subscription privileges at par
have been issued, and sundry extra and
valuable rights have been gwen TO
shareholders. The National Bell Tele-
phone Company had capital stock of
100000. When it concluded to reor-
ganze as the American Bell it sold 500
shares in its treasury for 5000 per share
to meet its immediate wants." 1t then
gave each shareholder six shares for one,
and turned the property over to the new
company for $4,000, 900, taking pay in
stock at par
Beside the numerous watermelons /"
that the Bell people have divided among
themselves, the regular and special
dividends have been large, averaging
14.72 per cent. mp to and including 1893.
The capital stock rose 10 10000, 900 in
1898, and the last Massachusetts Legis-
lature authorized a great increase.
People should not confuse this Ameri-
can Bell Telephone Company with any
of the subsidiary companies that
operate the telephone. They are
creatures Of the parent company, and
are under its control. Were it not for
the tribute they must pay the American
Bell the operating companies
could afford TO serve users
of telephones at rates far
below the present charges. Take the
Providence company for example. 1t
complies with all the exactions of the
parent company, and yet pays 8 per
cent. dividends TO its stockholders. II
1t was free agent, it could pay its s
per cent, aud furnish subscribers as
good service as they get now at a
greatly reduced rate.
Judge CARPENTER has rendered busi-
ness men great service, both in the
decision itself as il affects the telephone
monopoly, and in the very lucid aud in.
teresting expose Of the telephone ques-