The Salt Lake tribune. [volume] (Salt Lake City, Utah) 1890-current, 1911-01-05
GUT RATE DRUG
CASE IS ARGUED
Supreme Court of United States
Hears Controversy Involving
Alleged Restraint of Trade.
CHARACTER OF CONTRACT
Is POINT In CONTENTION
Decision WouId Have Far
Reaching Effect on Patent
Medicine Business.

WASHINGTON. Jan i.--Do con.
tracts to prevent "cut rates in pro
priotarv medicines violate tho Sher.
man antitrust law or the common law
in restraint of trade7 The question
was argued today before the supreme
court of the United States. Upon the
decision OF the court is said TO depend
the continuation of ''cut rates IN
proprietary medicines in the United
States. II probably will be several
weeks before the court will announce
its decision
he question was brought before the
court by the DR.. Miles Medical com
pany of rlkhart. Ind A few years
ago that company entered into certain
contracts with dealers in medicines
throughout The country. These were
not contracts Of sale, so the company
now contends, but contracts of con
signment, under which the dealers did
not become the owners of the medi.
cInes, but did become agents of the
company. One of he conditions of the
contracts was that the dealers should
sell only to certain persons and ut GER
tain prices.
injunction Is DeNleds
John d. Park & Sons company Of
Cincinnati, o., did not enter into a
contract with the DR.. Miles Medical
company. but the latter charges the
Cincinnati firm with inducing Others
who did make contracts to break
the conditions concerning persons and
prices The manufacturing company
went into the courts asking for IN in
junction against the Cincinnati firm to
prevent It from procuring contract VIC
]atiops and from selling the medicine
at cut rates
Justice Lurton then on the circuit
bench, announced the opinion of the
United States circuit court of appeals
for the sixth circuit, in which the in
junction requested by the manufac-
turer was denied. The case was ap-
pealed to the supreme court. and Frank
+. Reed and Edward S. Rogers pre-
sented brief in support of the po-
sition taken by the DR.. Miles Medical
company. Alton B. Parker and vii.
liam j. SHREDDER fled brief for the
John D. Park & Sons company.
in the brief for the manufacturer it
was urged that the lower court had
erred In holding that even If the con
tracts were construed as contracts of
consignment or agency, that they were
void because In restraint OF trade, both
at common law and under the Sherman
antitrust law.
Restraint Is Denied.
In the first place it was argued in
the brief that contracts between a
principal and an agent were not in re.
straint of trade, whatever conditions
were included in the contracts. Further
more, il was contended that the medi-
cines embodied trade secrets. and from
the very nature of the articles the
owner of the secrets was entitled to a
monopoly therein.
Tn the brief prepared by Mr.. Parker
and Mr. SHREDDER it was argued that the
courts could not insure an unnecessary
monopoly in proprietary medicines. II
was argued that the manufactures was
asking for a protection granted only
to patented articles, without subscrib-
inc to the condition imposed upon
patented articles, namely, that they
viii become available to the public
after few years. Extended arguments
were presented i'll the brief to show
that the contracts violated the common
law and the Sherman act.