Court Opinion

ID: 9418974
Source: CourtListenerOpinion
Date Created: 2023-08-02 22:44:09.04674+00
Date Added: 2024-06-11T17:22:13.847865
License: Public Domain

Mr. Justice Black,
dissenting.
The decisions in this case and Crown Cork & Seal Co. v. Gutmann Co., ante, p. 159, will inevitably result in a sweeping expansion of the statutory boundaries constitutionally fixed by Congress to limit the scope and duration of patent monopolies.
The area of the patent monopoly is expanded by the holding that the exclusive right granted an inventor to “make, use and vend” his patented commercial device, permits the inventor’s corporate assignee (and other “patent pool” participants) to control how, and where the *184device can be used by a purchaser who bought it in the open market.1
Petitioner bought amplifying tubes from the American Transformer Company, a licensed authorized to “manufacture . . . and sell only for radio amateur reception, radio experimental reception and radio broadcast reception.” The devices are of a standard and uniform type generally useful in many “fields.”
We are not here concerned with the right of respondents under the contract with the licensee, American Transformer Company. Respondents do not — in fact, could not — rely on.the contract made with the Transformer Company, in this suit against petitioner which in no way was a party to that contract. If the Transformer Company violated its contract respondents’ remedy was by suit against the Transformer Company for the breach.’. No question of malicious interference with contractual interests is presented. Respondents insist only that under their patents, they have the right to control the use of these widely used tubes in the hands of purchasers from one authorized by respondents to manufacture and sell them.
The mere fact that the purchaser of a standard and uniform piece of electrical equipment has knowledge that his vendor has contracted with an owner of a patent on the equipment not to sell the equipment for certain agreed purposes does not enlarge the scope or effect of the patent *185monopoly. The patent statute only gives the patentee the exclusive right to make, úse and vend his patented article. ,
Where a licensee — authorized to manufacture and sell — contracts with the patentee to attach a notice to each patented article (a machine) of “the conditions of its use and the supplies which must be used in the operation of it, under pain of infringement of the patent,” this Court has said: “The statutes relating to patents do not provide for any such notice and , . . [the patentee] can derive no aid from them . . . [inasuitagainstapurchaser from the licensee]. . . .
“The extent to which the use of the patented machine may validly be restricted to specific supplies pf otherwise by special contract , between the owúer 'of a patent and the purchaser or licensee is a question outside the patent law and with it we are not here concerned.”2
A patentee has no right under the patent-laws to fix the resale price of his patented article3 or to require .that specified unpatented materials be used in conjunction with it.4 The exclusive right to vend does not — any more than the exclusive right to- use — empower a patentee to extend his monopoly into the country’s channels of trade after manufacture and sale ¡which'passes title. It is not contended that petitioner did not obtain title to the tubes. .
The patent statute which permits a patentee to “make, use and vend” confers no power to fix and restrict the uses to which a merchantable commodity can be put after *186it has been bought in the open market from one who was granted authority to manufacture and sell it. Neither the right to make, nor the right to use, nor the right to sell a chattel, includes the right — derived from patent monopoly apart from contract — to control the use of the same chattel by another who has purchased it. A license to sell a widely used merchantable chattel must be as to prospective purchasers — if anything — a transfer of the patentee’s entire right to sell; it cannot — as to non-contracting parties — restrict the use of ordinary articles of purchase bought in the open market. “The words used in the statute are few, simple and familiar, . . . and their meaning would seem not to be doubtful if we can avoid reading into them that which they really do not contain.” 5 Petitioner is held liable for using an ordinary vacuum amplifying tube bought from one who had title and the right to sell. Notice to petitioner that the vendor was violating its (the vendor’s) contract. with respondents gave the latter no right under the patent and imposed no responsibility under the patent. Petitioner became the owner of the tubes.
At this time a great portion of the common articles of commerce and trade .is patented. A large part of the machinery and equipment used in producing goods throughout the country is patented. Many small parts essential to the operation of machinery are patented. Patented articles are everywhere. Those who acquire control of numerous patents, covering wide fields of industry and business, can — by virtue of their patents— wield tremendous influence on.; the commercial life of the nation. If the exclusive patent privilege to “make, use and vend” includes the further privilege after sale, to control — apart .from contract — the use of all patented merchantable commodities, a still more sweeping power can be exercised by patent owners. This record indi*187cates the possible extent of a power to direct and censor the ultimate use of the multitudinous patented articles with which the nation’s daily life is concerned.
This record shows that the General Electric Company system, the Radio Corporation system, and the American Telephone and Telegraph Company system are participants in a “patent pool.” This “patent pool” controls respondents’ patents. The record discloses that this “patent pool” operates under cross licensing agreements, in the United States and in foreign countries. It appears that the General Electric Company and the Radio Corporation have “agreed that the Radio Corporation shall not resell patented articles except as a part of the radio system,” and that the Radio Corporation “agrees to use care not to enter with any patent device, process or system into the field of the General Electric Company or to encourage or aid others to do so.” Throughout the entire agreement appears the manifest purpose of the “patent pool” participants to protect for each other certain allocated “fields.” in the production, sale and distribution of modern electrical necessities used in everything involving modern communications. Although the patent laws contemplate and authorize but one patent monopoly for one invention, many separate patents authorizing single patent monopolies are merged in this “patent pool.” Thus, all these separate patent monopolies are combined and in many respects are made .to function as one. The record shows that from this larger combination — completely outside the conception in the patent statutes of single and separate monopolies — allotments of sub-monopolies are made in the respective “fields,” from which emanate in turn other sub-monopolies. This Court has previously directed attention to the tendency of such combinations to stimulate patent law abuses, in the following language: “It was not until the time came in which the full possibilities seem first to have been appreciated of uniting, in one, many branches of business through corporate organiza*188tion and of gathering great profits in small payments, which are not realized or resented, from many, rather than smaller or even equal profits, in larger payments, which are. felt and may be refused, from a few, that it came to be thought that the ‘right to use . . . the invention’ of a patent gave to the patentee or his assigns the right to restrict the use of it to materials or supplies not described in the patent .and not by its terms made a part of the thing patented.” 6
. Articles manufactured under the patents thus controlled are widely used in the modern electrical field. The exclusive privilege to exercise the unrestrained power to determine the ultimate uses of all these important merchantable articles sold in the open, market, is a power I do not believe Congress has conferred. A power so far reaching — apart from contract — has not been expressly granted in any statute, and should not be read into the law by implication.
Second. The numerous patents acquired by respondents all relate to claimed inventions made between 1912. and 1916; yet, some of these patents do not expire until 1940. Patent No. 1448550 illustrates most of the patents involved. It is designated as the “continuation” of two *189earlier applications filed September 3, 1915 and November 2, 19l5. February 3, 1919 — more than four years after respondents’ commercial use — the “continuation” application was filed and March 13, 1923, the patent was granted. By this process of “divisionals” or “continuations” a seventeen year patent monopoly is permitted to begin in 1923, theoretically based on original applications which were filed in 1915.
Congress has provided that two years’ public use of an invention prior to application bars the right to patent7 and no patent rights are awarded for disclosures in an application which are not claimed.8 Here, however, approval is given patents for inventions — as the District Court found and the record shows — publicly used for more than two years before applications actually claiming the invention were filed. This approval is based on the fact that disclosures (unclaimed) were made in prior and separate applications which had not been preceded by two years’ public use. “Divisional” or “continuation” applications — unauthorized by any statute — are permitted to give priority from the date of original applications, in effect barring all other inventions from that date and nullifying the statute of two years’ public use. Thus for years respondents obtained no patent on their inventions for'lack of claim. No one else could safely -..obtain a patent because of the certainty that respondents would later claim under a “divisional” or “continuation.”
The statute provides no exception of public use by the inventor and, if he uses his completed invention in the ordinary conduct of his business — for more than: two *190years prior to his application — the discovery is abandoned to the public and he cannot thereafter obtain a patent.9 Such an exception — grafted onto the statute — would be directly contrary to its aim and purpose, and would enable inventors to obtain all the benefits of monopoly by simply making unclaimed disclosures, blanketing the field, and waiting until someone else attempted to claim a patent on the same invention. Then, by means of “divisional” or “continuation” applications, patent could be obtained. No such expansion of the patent statutes is justified.10 I believe the judgment of. the Court of Appeals should be reversed.

 The patented device here is an amplifying tube, and the opinion of the District Judge stated: “The amplifying devices required tubes which the defendant procured in the open market by purchase from authorized distributors; each tube carton bore a license notice reading as follows:
‘License Notice.
.'In connection with devices it sells, Radio Corporation of America has rights under patents having claims (a) on the devices themselves and (b) on combination of the devices with other devices or elements, as for example in various circuits and hookups.’ ” v

 Motion Picture Co. v. Universal Film Co., 243 U. S. 502, 509; see Keeler v. Standard Folding Bed Co., 157 U. S. 659.

 Bauer & Cie v. O’Donnell, 229 U. S. 1; Straus v. Victor Talking Mach. Co., 243 U. S. 490; Boston Store v. American Graphophone Co., 246 U. S. 8; cf. Bobbs-Merrill Co. v. Straus, 210 U. S. 339.

 Motion Picture Co. v. Universal Film Co., supra; Carbice Corp. v. American Patents Corp., 283 U. S. 27; Leitch Mfg. Co. v. Barber Co., 302 U. S. 458.

 Motion Picture Co. v. Universal Film Co., supra, at 510.

 Motion Picture Co. v. Universal Film Co. supra, 513-514.
In the agreement between the General Electric Company and the American Telephone and Telegraph Company, this appears:
“Article VIII.
“Acquisition of Patent Eights.
“Neither party shall acquire from others rights to do under United States patents or inventions, or rights to use secret processes, applicable to the fields of the other party, of such limited character that the other party does not, by the operation of this agreement, receive licenses thereunder of the scope and within the respective fields herein set forth, unless the party proposing to acquire such rights shall first have given the other party an opportunity to be represented in the negotiations and thereby to acquire rights for its field.”

 35 U. S. C., c. 2, § 31.

 Cf., The Corn-Planter Patent, 23 Wall. 181, 224; Miller v. Brass Co., 104 U. S. 350, 352; McClain v. Ortmayer, 141 U. S. 419, 423, 424; Buffington’s Iron Building Co. v. Eustis, 65 Fed. 804, 807; Ely Norris Safe Co. v. Mosler Safe Co., 62 F. (2d) 524, 526.

 “A single sale to another of such a machine as that shown to have been in use by the complainant more than two years prior to the date of his application would certainly have defeated his right to a patent; and yet, during that period in which its use by another would have defeated its right, he himself used it, for the same purpose for which it would have been used by a purchaser. Why should the similar usé by himself not be counted as strongly against his rights as the use by another to whom he had sold it, unless his use was substantially with the motive and for the purpose, by further experiment, of completing the successful operation of his invention?” Smith & Griggs Mfg. Co. v. Sprague, 123 U. S. 249, 257; International Tooth Crown Co. v. Gaylord, 140 U. S. 55; see A. Schrader’s Sons, Inc. v. Wein Sales Corp., 9 F. (2d) 306, 208.

 Cf., “The patent law was designed for the public benefit, as well as for the benefit of inventors....
"... A term of fourteen [now seventeen] years was deemed sufficient for the enjoyment of an exclusive right of an invention by the inventor; but if he may delay an application for his patent, at pleasure, although his invention be carried into public use, he may extend the period beyond what the law intended to give him.” Shaw v. Cooper, 7 Pet. 292, 320, 322.