Music Trade Review

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THE: MUSIC TRADE: REVIEW
THE FIXED PRICE AT WHICH PATENTED ARTICLES MAY BE SOLD. TRADE NOTES FROM CINCINNATI, 0.
Talking
Why the Feeling Prevails Among Many That This Ruling Tends ,to a Restraint of Trade Arises
from the Failure to Consider the Basic Principles Upon Which Patent Laws Rest—Some
Important Legal Citations of Interest in This Connection—Illuminating
Contribution to
The Review by Clarence N. Goodwin, of Chicago.
Machine to Accompany Party to the
Polar Regions.
(Special (o Tlic Review.)
Cincinnati, 0., April 21, 1906.
The R. Wurlitzer Co. has assumed the agency
for the Zonophone. Raymond Strief, manager
of the talking machine department, finds whole-
sale demand for Victor and Edison machines and
records on the increase. The latest records were
a feature of last week's popular concerts and
drew an immense crowd.
A high-class Victor instrument was sold to a
wealthy Cincinnati man for use on his yacht
during a recent bridal trip and will accompany
him and his bride to the polar regions this sum-
mer on a hunting tour. A number of Victor ma-
chines are being sold through the plan known
as the "One Man Band," which is the addition of
a drum to be used with the machine, and records
for dancing and rag time music. Twenty-five of
these combinations have been sold locally since
they were introduced at a recent concert in the
Wurlitzer store.
It has been uniformly held by the United
the general public must in the end equalize this
States Courts of Appeal, wherever the question
hy paying more than a fair price.
has arisen, that the patentee may fix the price at
It will be seen at once that the price which the
whieb articles mamiiictured under his patent, patentee shall receive is a matter entirely in his
may be sold to the public, and where notice is own hands by reason of the fact that he has a
given, the sale of a patented article at less than monopoly of manufacture and so has absolute
the license price is an infringement of the rights control of the price that he himself receives from
of the patentee and may be enjoined. The feel- jobber and dealer. In fixing, under his power to
ing among the many that these decisions are not control the sale, the price at which goods shall be
sound, but that the right claimed is contrary to sold to the public, he is not exercising the power
public policy as tending to the restraint of trade, primarily for his own benefit, but for the benefit
arises from a failure to apply to the question of the public and the dealer. By fixing a uniform
the basic principle upon which patent laws rect. price he protects the dealer against the demorali-
Anything in derogation of common right meets zation of trade which results from price cutting,
with public hostility unless clearly designed for and so gives him an inducement to handle the
the public good. Special privileges and mo- patented article. The benefit to the public is no
nopolies given to favored persons have
less direct. If the patentee acts intelligently for
time out of mind aroused public resent- his own interest he must fix the lowest price
ment. The patent law secures to the patentee possible, for he is fixing the price, not for him-
COLUMBIA CO. IMPROVEMENTS.
his heirs and assigns for the term of seventeen self, but for jobber and dealer, and the lower the
years the exclusive right to make, use and vend price the larger the market. In this way a
One of the features of the remodeled Columbia
his invention. ("Fed. Statutes," Vol. 5, p. 419, permanent benefit is given the whole public in- warerooms at 353 Broadway, is what is known
Sec. 4884.) The right given does restrain trade, stead of a temporary benefit to favored individu- as a dealer's booth. This is a large booth, fitted
manufacture and use for the period limited, and als. This finds a practical illustration in many up with every style of a talking machine made by
is a curtailment of common right, but the reason cases; among others, that of the Victor Talking the Columbia Phonograph Co., and arranged so
for the law rests on solid grounds of public policy Machine Co., which, after stamping out price- that every model shows off to the best advantage.
expressed in Article I., Section 8, of the Constitu- cutting, reduced the price of its records 40 per One of the ideas in creating this booth was to
tion of the United States, which provides: "The cent. These cases are not examples of benefi- enable dealers who do not carry a full line of the
Columbia product to bring their customers to the
Congress shall have power * * * to promote cent generosity, but rather of the exercise of hard
the progress of science and the useful arts by business sense in fixing the lowest price con- wholesale wareroom and use this booth in mak-
securing for limited times to authors and in- sistent with profitable manufacture, and making ing their sales, and receiving the assistance flf
ventors the exclusive right to their respective that price absolutely uniform. The stability the expert salesmen in their employ. It is the
writings and discoveries." The purpose of the assured by price control also permits of a con- aim of this company to do everything in their
provision clearly is to encourage invention as a stant improvement in quality, while it is a mat- power to further the interests of the dealers
means of accomplishing the declared purpose of
ter of general comment that the demoralization handling their product, and their recent improve-
the constitution, which is "to promote the gen- of price-cutting leads to the substitution of var- ments in their downtown warerooms were made
with this end in view.
eral welfare." It is to be noted, moreover, that nish and veneer for quality and worth.
the right given is for a limited period, and that
interested and delighted many hundreds of
after its expiration the invention becomes com-
EDISON BUSINESS PHONOGRAPH.
visitors. The instrument is electrically driven
mon property.
from the regular lighting circuit. By means of
Displayed With Great Success at the Office
The statute from which we have quoted above,
simple attachments the dictator may pause, be
Appliance Show in Chicago—Some Special
passed under the constitutional authority just
interrupted for hours, instantly repeat any of the
Features of Excellence That Commanded At-
noted, gives to the inventor in broad, simple lan-
words previously spoken, make corrections, give
tention—Those in Attendance.
guage the absolute dominion over manufacture,
instructions, and all with the certainty that an
use and sale. At first the inventor made use of
accurate letter will be written.
(Special to The Review.)
only his power to control manufacture, and to
The feature by which mistakes are caught is
Review Office, 195 Wabash avenue,
this no valid objection was or could be made.
very ingenious. There is a scale similar to that
Chicago, 111., April 21, 1906.
More recently he exercised his right to control
The office appliance show held in this city on a typewriter on the phonograph. A repro-
use, and this was opposed, not because it was marked the first public demonstration in Chicago duction of this scale appears on the leaves of a
not clearly given by statute, but because it had of the business phonograph of the National pad furnished with the machine. If under the
not been exercised, at least to any general extent Phonograph Co. It was coincident with the for- old regime the dictator made a mistake the type-
and therefore seemed an innovation, although mal opening of the business phonograph depart- writer operator wculd get the error down, no
in reality it was as old as the patent law T itself.
matter how hard her em-
The right was, of course, sustained by the courts,
ployer might correct it in
and still more recently the patentee made use
t he next breath. Now, with
of his third right, viz.: to control the sale of
t h i s scale arrangement,
his invention by fixing the price at which articles
when the dictator finds he
embodying it should be sold to the public, and
has made a mistake he
this also was for similar reasons opposed, but
stops the machine, notes at
was necessarily sustained by the courts on the
what point on the scale the
same grounds upon which the right to control
error commences, and then
manufacture and use had been sustained. The
on a similar point on the
subject is discussed and the authorities reviewed
scale on the pad marks
. by the United States Circuit Court of Appeals for
"M" for mistake. The op-
the Seventh Circuit in the case of Victor Talking
erator has the memoran-
Machine Co., et al. vs. The Fair, 123 Fed. Rep.
dum before her, and when
she reaches the point in-
424, in which Mr. Horace Pettit of Philadelphia
dicated stops until she has
appeared for the complainant.
heard the error, omits it
H is a mistaken notion that the control of the
and commences with the
price at which an article may be sold to the pub-
correction. Another fea-
lic works a hardship to the public, even for the
ture of the Edison machine
limited time during which the patent is in force.
is
the new combination re-
We have all come to see that railroad rebates and
producer and recorder.
special transportation rates to favored individu-
In charge of the exhibit
als is a matter against public policy for the
was C. L. Hibbard, man-
reason that if certain people are given rates that
ager of the Chicago branch
are unreasonably low this must be equalized by
niSIT.AY OF NATIONAL PHONOGRAI'II CO. AT CHICAGO.
of t h e Edison business
fixing rate's for the general public that are un-
reasonably high, and it is simply robbing Peter ment, advance information of which has already phonograph, assisted by Geo. B. Walker and a
to pay Paul, who is usually much abler to pay been given in these columns. In a large space competent staff. Nelson C. Durand, who is the
than Peter. In the same way, if a patented in the south end of the Coliseum the Edison general manager of the Edison business phono-
article is sold to favored individuals at prices commercial system, conducted with the business graph, who has been getting the new branch in
which do not allow a fair percentage of profit, phonograph, was exploited in a manner which full working order, was also in attendance.