Albuquerque morning journal. [volume] (Albuquerque, N.M.) 1903-1926, 1912-11-19
Supreme judicial Tribunal of
United States Holds 0waer
of Patent Cannot Control
Price of Its Products,
OPINION EXPECTED TO
BE EPOCH MAKING
Has Bearing on Many Cases
Now Pending and Is Expect
ed to Curb Combinations in
Restraint of Trade,

(By Morning journal Special Leased Wire.
Washington, NoN. 1S.-ln an epoch
making decision today in the So
called bath tub trust" case, the su-
preme court OF the United States laid
down the broad principle that there
can be no monopoly in the impatient
ed product of patented machine
without violating the sherman anti
trust law. Justice Mckenna de-
livored the unanimous opinion of the
court.
In accordance with this doctrine,
the court struck down as illegal the
license agreements by which manu-
facturers of S5 per cent of the sani-
tary enameed iron ware in the Unit
ed states were bound together in
combination. The license agreement
allowed the manufacturers to use
patented dredger, but only on condi-
tion that they abide by an attached
price list, would not sell to jobbers
who bought from independents
would not sell in certain territory,
and would not sell seconds.
Officials Of the department of JUS
tice were highly elated over the de-
AlTiVll WliAAil, II - Nitiiii'N'f 49, 80
an important bearing on several in
vestigations now under way as well
as on antitrust suits already filed
against the so-called moving picture
trust and the United Shoe Machin-
cry Company. The decision is re-
garded as important because of the
government claim that the patent
license agreement" plan was being
adopted by many concerns as re-
suit of the judicial ban upon the
pure trust plan" as eXenplified in
the case Of the Standard Oil Company
of Ohio; the holding company plan
as declared invalid in the Northern
Securities case and the combination
OF a holding company and manu- f.
featuring company as shown in the
Standard Oil and tobacco cases.
Justice McKenna in his opinion
said that the effect of the agreements
was to cover Independent and com /
petitive companies into combina-
ton subjected to rules and regula-
tons The trade was practically con-
trolled from producer to consumer /
said he. and the potency of the
scheme was established by the CO.
operation u 90 per cent VI tllt man
facturers and their fidelity was Sc
cured not only by trade advantages
but by what was practically pecu-
mary penalty, not inaptly termed in
ihe argument cash bail
Today's decision sustains the de-
,ree of the United States district
court for Maryland abrogating the
license agreements and paves the
way for the retrial Of the criminal
'uit against the bath tub trust, the
'irst trial Of which, at Detroit sew
raj months ago resulted in a dis
agreement Of the jury.
Edwin F. Grosvenor. special assist
int to the attorney general, who
prosecuted the case ana argued it in
he supreme court said tonight
ION the argument in the supreme
'ourt the main reliance of the de-
was the decision in Dick
ersus Henry, called the mimeograph
'ase. rendered by the supreme court
asst March There it was held that
he owner Of a patent on a mimeo-
,raph may compel the purchaser of
he patented mimeograph to buy
rom him all paper and ink which
S to he used on the mimeograph al
hough, of course. the paper and ink
re not covered By the ra.'nt.
The decision of today uses TO
Xtcnd the decision Of the DieH case ;
o the unpatented product of pa
ented machine. The defendant in
he bath tub case, owning patents on
machines used in the manufacture of
nameled ware attempted to fix ,
rices ana destroy competition in
ommercc IN the unpatented ware
The economic effect of the prose-
utiOn by Attorney General Wicker &
ham is interesting The combina- s
ION commenced opcra tions in July. I
80. Since the combination was J
roken up. the prices of the product {
ave fallen from 25 to 10 per cent, !
ct today nearly all the manufac- >
lrcrs engaged in the business are
unning their factories over time and }
ley are all making money at the re- 1
uced prices" I