Hartford-Empire Co. v. United States

Owens was not to sell or license any of its gob feeding machinery and was not to engage in the pressed and blown glass fields that had previously been reserved to Corning.

"[7] After 112 days of trial and a 12,000-page record, the district court found "that this violation of the laws was as deliberate as any that I can find in a review of anti-trust cases.

"[9] The court stated of these agreements: "This plainly is an illegal, cooperative effort upon the part of Corning and Hartford to use the patent strength of each to protect the exclusive fields of the other.

The limited term for which the licenses were issued permitted Hartford to retain such a measure of control over its licensees that it was unnecessary to more than warn them.

Future distribution of machinery must be "put on a basis of outright sale at reasonable prices" to all comers, including all licensees and outsiders.

[29]The majority added that Congress had failed to enact proposals for forfeiture or cancellation of patents used as an instrument to violate the antitrust laws.

If he discloses the invention in his application so that it will come into the public domain at the end of the 17-year period of exclusive right, he has fulfilled the only obligation imposed by the statute.

Congress has repeatedly been asked, and has refused, to change the statutory policy by imposing a forfeiture or by a provision for compulsory licensing if the patent is not used within a specified time.

In his view: The District Court's decree, taken as a whole, is an effective remedy, admirably suited to neutralize the consequences of such violations, to guard against repetition of similar illegal activities, and to dissipate the unlawful aggregate of economic power which arose out of, and fed upon, monopolization and restraints.

They planned their monopolistic program on the basis of getting and keeping and using patents which they dedicated to the destruction of free competition in the glass container industry.

The decree as modified leaves them free, in a large measure, to continue to follow the competition-destroying methods by which they achieved control of the industry.

That memorandum which discussed plans for suppression of a number of competitors, with particular reference to possible prosecutions under the Sherman Act, read in part as follows:

He criticized the majority's wrong assumptions as to "the respective functions of trial and appellate courts in framing the decree, as well as to the criteria by which are to be gauged the quantity and quality of relief needed to be effective.

"[40] He said that "the number, character and detail of the revisions" by the majority suggest "that it is the business of this Court to rewrite the decree, substituting its own judgment for that of the District Court when there is difference concerning the wisdom or need of a particular provision," but that is based on the, majority's "misconception that men who have misused their property, and acquired much of it, by violating the Sherman Act are free for the future to continue using it as are other owners who have committed no such offense, and that consequently the appropriate relief affecting such use is the least restriction which possibly will prevent repetition of past violations.

It is wholly incongruous in such circumstances to say that the privilege of the trespasser shall be preserved, and the rights of all others which he has transgressed shall continue to give way to the consequences of his wrongdoing.

The dissent objected to the majority's having "undertake[n] the long distance writing of the detailed provisions for relief, amounting to a framing of the decree, in [these] Sherman Act proceedings.

and he suggested that Congress had "intended to put some teeth in the antitrust laws" along the lines of the district court's so-called drastic order that Justice Roberts found unlawfully confiscatory.

Hartford had presented to the court a supposedly objective article describing the merits and unobviousness of the patented invention, but had itself ghost-written and paid the ostensible author (a union official).

"[51] ● In still another contemporaneous commentary, Walter J. Derenberg summarized the Supreme Court majority's holding as that "even in case of gross abuses of patent rights no relief of a 'confiscatory' character should be granted in a civil proceeding under the Sherman Act.

"[52] Despite the substantial modifications of the decree, Derenberg said, "the majority opinion still remains precedent breaking in that for the first time the court sanctioned the relief of compulsory licensing on a basis of reasonable royalties of all existing and future patents pertaining to the machines and methods" that the conspirators used to effectuate their antitrust violation.

[53] ● A 1954 Note in the Yale Law Journal[54] explained that following Hartford-Empire, district courts refused under any circumstances to decree compulsory licensing without royalties.

"[62] It pointed out that other Supreme Court antitrust decisions sustain divestiture and dissolution in appropriate cases despite hardship and economic loss.

[68] The defendants argued that they had cancelled the objectionable patent licenses and they moved for the entry of consent decrees that, they alleged, would include all the relief that the Government requested in the complaint with respect to the remaining issues.

The court does not now know and cannot pre-judge what the testimony in this case will disclose; therefore, he cannot anticipate what form of relief he would deem to be wise, expedient, and necessary to be entered into a decree, if it be found that some or all or substantially all of the allegations of the complaint are sustained.

The Court considered an automatic award of royalty-free licensing "inequitable without special proof to support such a conclusion," but said that in an appropriate case "royalties might be set at zero or at a nominal rate.

"[84] According to Contreras, the incandescent lamp bulb case against General Electric[85] was notable not only because it required dedication of GE's vast aggregation of lamp patents—"arsenal of a huge body of patents"—but also because the court held that “it is advisable to require the defendants to license whatever machinery patents they have without possessing the correlative right to demand licenses in return.

[87] Then another antitrust suit against AT&T, alleged that it illegally limited the connectivity of its network to MCI and other carriers, and blocked competing manufacturers from providing equipment to Bell operating companies.

In 1948, a district court entered a consent decree establishing that Securit and other glass-manufacturer defendants violated the Sherman Act by conspiring to exploit patents covering technology for tempering flat glass panes in a restrictive manner.

The district court found a violation but refused to order compulsory reasonable royalty licensing or to allow the Government to challenge patent validity.

[96] "The consent decree entered in" the Xerox case,[97] Contreras states, "is notable, not least because the enforcement action in question was brought by the FTC rather than the DOJ.

Hartford gob feeder
Owen J. Roberts delivered the majority opinion
Justice Hugo Black dissented from the majority's modification of the relief that the trial court ordered
Justice Wiley Rutledge dissented