Evening star. [volume] (Washington, D.C.) 1854-1972, 1913-05-26
CUT RATES UPHELD
BY SUPREME COURT
Thousands of Patented Arti-
cIes Affected by Decision
Favoring Retailers.

Patented articles sold under price
restrictions by manufacturers maye be
resod by retailers at cut rates. The
Supreme Court 20 held today in the
case of a newly patented nerve tonic.
Safety razors. talking machines and
thousands of other patented articles
are affected by the decision
With the exception of a decision by
Judge Ray in the federal court in
New York. the manufacturers had been
successful in suits in federal courts to
uphold their price restrictions lnas-
much the decision of the lower fed
eral courts is final In patent cases. the
Supreme Court had not had an oppor
tunitN TO pass upon the question before
today. The opportunity presented today
arose through doubt by local judges as
to what was the law.
Local Druggist Center of Fight.
local druggist had sold the patented
nerve tOnic at cut rates. The manu-
facturer sued him for alleged infringe
ment Of the patent jim that he had
violated the notice each bottle that
each package was for sale and use at
not less than 81. and any sale for less
would be an infringement of the patent
Supreme Court the question of whether
the acts of the druggist in retailing
1T less than the price fixed III the notice
cons ,ituted an infringement of the
patent
Justice Day announced tie court deci-
sion. lie said tha; the patent law gave
the owner the exclusive right to ''Nend
articles lie explained the question was
whether the owner thus got right to
keep up the price. In substance he de-
clared the right to keep up the price
was not the same as to 'vend' or sell
and so not granted by the patent law to
patent owners.
Justices Mckenna. Holmes, Lurton and
Van Devanter disSented.
Justice Day in his decision dis
tinguishes" the famous "mmeograph
case" of more than year ago. but
many lawyers who heard the decision
regarded the term as a polite phrase
for reserving that case.
Justice Day said that in the "mimeo-
graph case the restriction dealt with
the use of the machine. namely. speci-
fed what materials could be used upon it,
and was qualified sale consequently.
He declared that in the case before
the court today 1t would be a perNersIon
,f terms to call the transaction in any
sense a license to use the invention
He added that there was no showing of
a qualified sale for less than value
for limited use with other articles upon
which profit. was expected to be reaped.
but was complete sale wherein all
title of the paten- owner had been
transferred to the retail dealer.
Upholds Rights of Vender
.kttef dlSnoSlnS oi the 'iHliheoSfdpH
case. Justice Day said in conclusion:
THE real question is whether in the
exclusive. right secured by statute To
..yend'' a patented article there is includ-
ed the right. by notice, to dictate the
price at which subsequent sales of the
article may be made
..'rhe patentee relies solely upon notice
quoted to control future prices in the re-
sale by purchaser of article said to
he of great utility and highly desirable
for general use. The appellee and the
iobbers from whom he purchased We're
neither the agents nor the licensees of
the patentee.
They had the title to and the right
to sell The article purchased without
accounting for the proceeds to the
patentee and without making any fur
thef payment than had already been
made in the purchase from the agent
of the patentee.
Upon such facts now pre-
sented we think the right to yend
secured in the patent statute is not
distinguishable from the right of vend-
ing given in the copyright act.
..In both instances il was the Intention
of Congress 10. secure an exclusive right
to SELL and there is no grant of a pryi-
lese to keep up prices and prevent COM
petition by notices restricting the price AT
which the article may be resold. The
right to vepd conferred by the patent law
has been exercised and the added restric-
lion is beyond the protection and purpose
Of the act.