Victor Talking Mach. Co. v. Strauss

• Decision Date: 11 January 1916
• Docket Number: 140.
• Citation: 230 F. 449
• Parties: VICTOR TALKING MACH. CO. v. STRAUSS et al.
• Court: U.S. Court of Appeals — Second Circuit

230 F. 449

VICTOR TALKING MACH. CO. v. STRAUSS et al.

No. 140.

United States Court of Appeals, Second Circuit.

January 11, 1916

Frederick A. Blount and Hector T. Fenton, both of New York City, for appellant.

Wise &amp Seligsberg, of New York City (E. E. Wise, of New York City of counsel), for appellees.

Before LACOMBE, COXE, and ROGERS, Circuit Judges.

LACOMBE Circuit Judge (after stating the facts as above).

This case presents the familiar one of the manufacturer of a patented article undertaking to extend its use and at the same time regulate the terms and conditions under which it shall be used. It seeks to accomplish this in part by a written contract entered into between itself and every so-called licensed dealer to whom it delivers the possession of instruments or records. This need not be recited, as in substance it is the same as a so-called 'license notice' which is attached to a conspicuous part of every machine. This notice varies only in its statement of the amount of royalty, which of course is different for different types of machine. The notice affixed to every instrument of the type known as Victrola XVI reads as follows:

'This machine is manufactured by us under our patents hereinafter noted, and is licensed for use only for the term of the patent having the longest term to run, and only with sound records, sound boxes and needles manufactured by us; and our records and sound boxes are licensed only for use with our machines. Only the right to use the said machine is granted to Victor distributors and dealers, for demonstrating purposes, with the right to the distributor to assign a like right to regularly licensed Victor dealers at the dealers' regular discount royalty, with the right to the dealers to convey the license to the public to use the said machine only when a royalty of not less than $200.00 shall have been paid, and upon consideration that all the conditions of license shall be strictly observed. A similar right is also granted to the distributor to convey to the public the right to use this machine under the same conditions. No license to use this machine is granted to the public until the full royalty shall have been paid. This machine is not licensed for use for public entertainments for profit; for a license for such public use an extra license fee of ten per cent. (10%) of the full royalty shall be payable. Title shall remain in the Victor Talking Machine Company; also the right to repossess the said patented goods upon the breach of any of the conditions upon the repayment by the Victor Company to the user of the royalty paid by him; less 5% per annum of the full royalty for each year, or fraction of a year that the user shall have had the use thereof. The Victor Company also reserves the right for itself and its representatives to inspect, adjust and repair this machine at all reasonable times while in the possession of the user, and to instruct the user in its use, but assumes no obligation so to do. All patent rights are reserved by the licensor except those hereby granted to the licensees upon the performance of the conditions noted. Any excess use, or violation of the conditions, will be an infringement of the said patents. The patents under which this machine is manufactured and licensed for use are, among others, as follows: (Here follows a long enumeration of the numbers and dates of issues of various patents); and other U.S patents under which this machine or parts thereof are manufactured.

'No license is granted to use this machine in any altered or changed condition or with any parts not manufactured by this company. This machine is licensed for use only in the condition, construction and arrangement in which it is put out by us, and any use of this machine, or parts thereof, in any other or altered construction or arrangement, will be construed as a violation of this license. This machine is licensed for use

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