New-York tribune., 1922-09-09
Iasugl,ersy Begins Litigation
Against Chemical Foun-
dasioln in Wilmington;
President Advised Action
ssaaopoIy Is Charged q
cau,pIaint Alleges ssTrtlss'
WheetIled Alien Patents
fr0n(sarvan for S27O, 900

sstnernl Dsugnerty, On osAaiA VA
81 #.s.,..vnuans. began to-day legal pro-
ssaa,uvs 10 regain all patents ana
.srntsy rights now held by the
essm,,al Foundation, Inc, and OBJ
..;rsd BY ii through sale from the
alien Property Custodian. Patents and
.s.a,warks estimated to be worth
.arv millions Of dollars are involved.
The government seeks to have al
A..s returned to the Alien Property
rrs,odian In accordance with the re-
essst ~ President Harding dated
July last a., hv aha Ar
.o~ney General in the DistricS toult Oh
49, 1ynited States for the District OF
nsIaware. at Wilmington, IN Whicn
a..ss fbs Chemical Foundation IS IN
ssrrorased The defendant IS asked to
IN required TO account for all pronts
ls,iyad from these patents and trade
rxrss and other rights, and to pay the
same oyer 10 the Alien property Gus
fsdian. The amount Of these profits is
not estimated.
Urges Protection for All
-rha government requires that the
.nnrt In granting the relief sought will
- shape its DEGREES and impose such
sauifable conditions that the rights
IA interests of all licensees Of said
satents. either from the Chemical
foundation or the Federal Trade Com
,aIssion, may be protected. The bill
,ssciacaliy prays that the patents and
4her rights, as we'll as the income
serefrem, be returned to the govern
ssrs. to be held by the Alien Property
fsstodian and disposed Of by him as
sag provided by law or as may be pro-
Wded by any future legislation by
RE bill further prays that the
f6enaical Foundation be enjoined from
syasecuting the many suits Aereto-
sSys brought by it to recover license
s,ss under such patents and other
,;rhts heretofore paid to the United
sstss and now in the United States
TrsasurT. 1t also asks an injunction
sssinst the Chemical Foundation to
sTsvent 1t from disposing of or en-
sumbering the patents and other rights,
md from wasting income which it is
receiving from licensees for such
patents.
It is alleged in the bill that the
H eAemical Foundation has no other as
ssss of value except the patents and
4 rights which this suit seeks to re-
cover, and that it is now spending
ssrgs sums of money partly derived
from revenues from licensees of such
paterts and rights for salaries, legal
lees and in publicity and propaganda
cn hskslf Of and in creating public
sentiment favorable to the Chemical
Foundation 1t is alleged in the bill
mat the Foundation is creating u
dGfeit and that, aside from the prop
cry sought TO be recovered, it is in?
solvent.
Patents Worth Millions
& Ths bill alleges that the patents dis
+ Issd Of are worth many millions of
4 isasss and that the consideration OBJ
taissa was wholly and grossly made
Fasts. The government maintains that
these sales are sustained it would
fsnstitute coniscation of these prop
sEies and a violation of the trust
Ender which they were held.
The government makes broad and
general allegations of plan to create,
md the existence of, dye and chenli-
4 col monopoly in the United States,
\ OF of these products from Germans
II upon the declaration of war. The bill
81 q complaint shows that before June,
h 1918, considerable progress had been
made In the formation of such q
monopoly by limited number of cor
porations, chief among which were the
National Aniline and Chemical Com
pany, the General Chemical Company,
the Solvay Process Company, the
oemet-Solvay Company and the Bar
iett Company, sll of which in 1920
we're combined into the Allied Chen,i-
cal and Dye Corporation and E. I. du
Font de Nemours & Co.
ne government further alleges that
control Of the industry was effected by
msaha OF agreements between these
sufpoiabohs and other persons, firms
sau corporations, and by means of
taus organizations, among others the
- 9tnef,ean Dyes Institute. the American
sshemical Society, the Chemical Manu-
ssscturers Association of the United
as.ates' the Textile Alliance, Inc, and
aaen aailiated organizations. The gov
aninsnt alleges and charges that by
anS ~sshs OF such methods, agreements
saa organizations there had been eo-
sva,plsaed by June, 1918, "an organ
= Az ana united control and monopoly
Z .he manufacture, sale and distribu-
1 ~ oI oyes and the ingredients there
"a ana OF chemicals related thereto or
4 n.a. sa ~ connection Herewith in the
4 Conceived Conspiracy"
& ,.s.p sns Diii further sets forth that the
4 asohss nfms and corporations who
II ssa sS acquired control of the dyestnffs
a s..s. a. enemleai Industry in the United
q Ss, teaflng that at the end of war
u t ssst monopoly and control would be
a Nseo - .Lo ny German importations un-
sy ~ eney could obtain control of many
8 ss.aly-owned patents covering these
n h,yuuets III and could, through such con
-, prevent the importation of such
ssacss INTO the United States after
ia Gsat except upon the terms and con-
hss~s, Sas walch they as owners of the
'a might prescribe, conceived and
81 ;saea into a scheme, combination
n snnsplracy prior to or about No
81 49, 1910, to procure the seizure of
8 hsnas.s nasa.sniy-o"ned patents by the Alien
y b 5is, eustedian and the transfer
sss'eilsd by them. @S1V''
II faaNs1 etSf aleEeQ In2T in Dur-
II rrs ~ such plans such persons,
as y corporations as early as June,
n $50, ,aa,l,ough their representatives and
ss,y through Morris r. Poucher,
ass.shsing and acting for said con-
Is gnas, n., approached the Alien Prop
b sastoalan and certain of his as
u AL, A.. anc especially Francis P. Gar
a ssn sasan property Custodian; Joseph
b Aasase 1r., attorney for the Alien
n t.IelEy Custodian. and 1890 sIe