CASES ADJUDGED IN THE SUPREME COURT OF THE UNITED STATES AT OCTOBER TERM, 1912. BAUER & CIE v. O'DONNELL. CERTIFICATE FROM THE COURT OF APPEALS OF THE DISTRICT OF COLUMBIA. No. 951. Argued April 10, 1913.—Decided May 26, 1913. The right to make, use and sell an invented article existed without, and before, the passage of the patent law; the act secured to the inventor the exclusive right to make, use and vend the thing patented. While the patent law should be fairly and liberally construed to effect the purpose of Congress to encourage useful invention, the rights and privileges which it bestows should not be extended by judicial construction beyond what Congress intended. In framing the patent act and defining the rights and privileges of patentees thereunder Congress did not use technical or occult phrases, but in simple terms gave the patentee the exclusive right to make, use and vend his invention for a definite term of years. A patentee may not by notice limit the price at which future retail sales of the patented article may be made, such article being in the hands of a retailer by purchase from a jobber who has paid to the agent of the patentee the full price asked for the article sold. Henry v. Dick Co., 224 U. S. 1, distinguished. The patent law differs from the copyright law in that it not only confers the right to make and sell, but also the exclusive right to use the subject-matter of the patent. VOL. CCXXIX-1 (1) Argument for Plaintiffs-Appellants. 229 U.S. The words "vend" and "vending" as used in § 4952, Rev. Stat., in regard to the copyright protection accorded authors and as used in § 4884, Rev. Stat., in regard to the protection accorded inventors for their patented articles, are substantially the same, and the protection intended to be secured to authors and inventors is substantially identical. While Bobbs-Merrill Co. v. Straus, 210 U. S. 339, recognized that there are differences between the copyright statute and the patent statute, and disclaimed then deciding the effect of the word "vending" as used in the latter, this court now decides that the terms used in regard to the protection accorded by both statutes in regard to the exclusive right to sell are to all intents the same. The right given by the patent law to the inventor to use his invention should be protected by all means properly within the scope of the statute, and the patentee may transfer a patented article with a qualified title as to its use. Henry v. Dick Co., 224 U. S. 1. Where the transfer of the patented article is full and complete, an attempt to reserve the right to fix the price at which it shall be resold by the vendee is futile under the statute. It is not a license for qualified use, but an attempt to unduly extend the right to vend. Henry v. Dick Co., 224 U. S. 1, distinguished. While the patent law creates to a certain extent a monopoly by the inventor in the patented article, a patentce who has parted with the article patented by passing title to a purchaser has placed the article beyond the limits of the monopoly secured by the act. Adams v. Burke, 17 Wall. 453. THE facts, which involve the construction of § 4884, Rev. Stat., and the extent of the rights thereunder of patentees to control the price at which the patented article shall be sold by their vendees, are stated in the opinion. Mr. Edwin J. Prindle for plaintiffs-appellants: The inventor has the right to exclude every one from any making, using, or selling of the patented invention. Therefore, when he grants any right under the patent to anyone, he simply waives his right to exclude them from all making, using, or selling of the patented invention to that extent, and all ungranted right of exclusion remains in him. 229 U. S. Argument for Plaintiffs-Appellants. A notice of price restriction on a package is notice to all the world that the right to sell the article below the price stated on the package is not granted and does not pass from the inventor. Defendant's sale at a retail price below the amount named, of packages bought from jobbers and having the license restriction label on them, was an infringement. Price restrictions have been sustained in this court and in the lower Federal courts. Mitchell v. Hawley, 16 Wall. 544; Henry v. Dick, 224 U. S. 1; Bement v. National Harrow Co., 186 U. S. 70. The right of a patentee to restrict the price at which his article shall be sold by a license-restriction-notice attached to the article, of the same import as the notice in the present case, has been sustained by many of the lower courts in the United States and by the courts of England. Victor Talking Machine v. The Fair, 123 Fed. Rep. 424; New Jersey Patent Co. v. Schaefer, 144 Fed. Rep. 437; Rubber Tire Wheel Co. v. Milwaukee R. W. Co., 154 Fed. Rep. 358; Goshen Rubber Works v. Single Tube A. & B. Tire Co., 166 Fed. Rep. 431; Edison v. Ira M. Smith Co., 188 Fed. Rep. 925; Waltham Watch Co. v. Keene, 191 Fed. Rep. 855; Automatic Pencil Sharpener Co. v. Goldsmith Bros., 190 Fed. Rep. 205; Indiana Mfg. Co. v. Nichols, 190 Fed. Rep. 579; Incandescent Gas Co. v. Cantelo, 12 Rep. Pat. Cas. 262; Same v. Brogden, 16 Rep. Pat. Cas. 183; Badische Analin &c. v. Isler (1906), 1 Chancery, 611; McGruther v. Pitcher (1904), 2 Chancery, 306; National Phonograph Co. v. Mench, 27 T. L. R. 239; The B. V. D. Co. v. Wolf (unreported); The Fair v. Dover Mfg. Co., 166 Fed. Rep. 117; Edison Phonograph Co. v. Kaufmann, 105 Fed. Rep. 960; Edison Phonograph Co. v. Pike, 116 Fed. Rep. 863; National Phonograph Co. v. Schlegel, 128 Fed. Rep. 733; Ingersoll v. Shellenberg, 147 Fed. Rep. 522; Winchester Arms Co. v. Buengar, 199 Fed. Rep. 786; American Graphophone Co. v. Pickard, 201 Fed. Argument for Plaintiffs-Appellants. 229 U. S. Rep. 546; Lovell-McConnell Co. v. International Automobile League, 202 Fed. Rep. 219. Many of the foregoing cases are identical, in principle, with the facts in the present case. The patentee's control over selling was recognized by this court in Henry v. Dick, 224 U. S. 1. The right of the patentee to restrict the price at which his article shall be sold comes within the principle decided in Henry v. Dick, and the defendant in this case is a contributory infringer precisely as Henry was in that case. The patentee's monopoly of selling is coördinate with that of using his patented article and subject to the same degree of control. Adams v. Burke, 17 Wall. 453; Bement v. National Harrow Co., supra; Standard Sanitary Co. v. United States, 226 U. S. 20. Plaintiffs did not receive the full consideration for the patented article when they received the purchase money from the defendant or the jobber, and they have a continuing interest in the article. Patentee's control over the price of his article is reasonable, proper and consistent with sound public policy. Defendant's purchase from jobber instead of from plaintiffs does not relieve him from infringement, as he had notice through the price restriction on the label. Victor Talking Machine Co. v. The Fair, 123 Fed. Rep. 427; New Jersey Patent Co. v. Schaefer, 144 Fed. Rep. 437; S. C., 159 Fed. Rep. 171; Edison v. Smith, 188 Fed. Rep. 925; Automatic Pencil Co. v. Goldsmith, 190 Fed. Rep. 205. The Waltham Watch Case, 191 Fed. Rep. 855, has no bearing on the case at bar, and the language quoted had no reference to the distinction in the present case. So also as to the Folding Bed Case, 147 U. S. 659. There is no attempt in this case at monopoly or to restrict trade. The patentee only seeks to control the price 229 U. S. Argument for Plaintiffs-Appellants. of an article in an industry which he himself has created, and in which the public has had no previous rights or experience of free competition in the article. The public is just as free to purchase unpatented articles as it ever was, and the monopoly which the law gives the patentee is only the inducement which it held out to the patentee to make the invention and the just and proper price paid for his contribution of it forever to public knowledge at the expiration of the monopoly. The defense based on the copyright statute and BobbsMerrill v. Straus, 210 U. S. 339, does not apply. Judge Ray in his decision in the Waltham Watch Case argues at length that as the Supreme Court in the Bobbs-Merrill Case held that an author has no right to fix the price at which his book should be resold, it follows that an inventor is also without that right. This court in that case expressly refused to express an opinion as to whether, under the state of facts in the present case, its decision would be the same as it was in that case. These three separate rights of making, using and selling granted the inventor by the patent statute have always been treated as coördinate rights and never been treated as of different rank. The right to sell is always treated as coördinate with the right to make and use in the patent cases, while as decided in the Bobbs-Merrill Case, the right to sell under the copyright statute is merely incidental to the right of duplication. There are vital differences between the right to vend of the inventor and the right to vend of the author. And because of the differences in the nature of a patented article and an author's book, there are vital differences in what is involved in "vending" under the two statutes. The power of an inventor to subdivide the right to vend, |