[Trade Journal]
Publication: Verbatim Record of the Proceedings of the Temporary National Economic Committee
Washington , DC, United States
vol. 1, no. 12, p. 321-352, col. 1-3
VERBATIM RECORD
of the
Proceedings of the
TEMPORARY NATIONAL
ECONOMIC COMMITTEE
VOLUME 1
December 1, 1938 to January 20, 1939
CONTAINING
Economic Prologue
Automobile Patent Hearings
Glass Container Patent Hearings
Presentation on Patents by Department of Commerce
Published 1939 by
THE BUREAU OF NATIONAL AFFAIRS, INC.
WASHINGTON, D. C.
·
·
Appendix
______________
VERBATIM RECORD
of the Proceedings of the
Temporary National Economic Committee
Vol. 1, No. 12 WASHINGTON, D. C. Dec. 19, 1938
APPENDIX
MONDAY, DECEMBER 19, 1938.
THE OFFICE OF THE TEMPORARY NATIONAL ECONOMIC COMMITTEE MADE PUBLIC DECEMBER 19, 1938, TEXTS OF EXHIBITS RE-CEIVED IN EVIDENCE IN THE HEARINGS IN THE WEEK BEGINNING DECEMBER 12, NOT HERETOFORE PUBLISHED. A SUMMARYOF EXHIBITS INTRODUCED AT THE HEARINGS FOLLOWS:
Pamphlet, prepared by the Department of Justice for use of the Temporary National Economic Committee for use in connection with the study of patent practices in the glass container industry.
Referred to in Verbatim Record, Dec. 12, Page 194. The pamphlet consisted of 27 pages of text, illustrations and charts describing the process of manufacturing glass containers and giving certain general economic facts regarding that industry in the United States. This Exhibit No. 112, was printed in the appendix of the issue of Dec. 12.
Charts prepared by the Department of Justice indicating the major inter-company relationships in the glass container industry, Exhibit No. 113. Referred to in Verbatim Record, Page 196. Printed on Page 197 of Dec. 12 issue.
Schedule of royalty fees charged by the Hartford-Empire Company, Exhibit No. 114. Referred to in Verbatim Record Page 202, and printed on Page 203 of the Dec. 12 issue.
Schedule of receipts from royalties and license fees by the Hartford-Empire company, from 1923 to 1937 inclusive, Exhibit No. 115. Referred to in Verbatim Record, Page 202, and printed on Page 202 of the Page 204, Dec. 12 issue.
Chart showing percentage production in the output of the various products of the glass container industry, Exhibit No. 116. Referred to in Verbatim Record, Page 204. Printed on Page 205, Dec. 12 issue.
Chart contrasting the output of five large companies in the glass container industry as compared with the remaining companies. Exhibit No. 117. Referred to in Verbatim Record, Page 204. Printed on Page 204, Dec. 12 issue.
Photostatic reproduction of 17 pages of a license and lease agreement dated Aug. 2, 1935, from the Hartford-Empire Company to the Florida Glass Manufacturing Company of Jacksonville, Fla., Exhibit No. 118. Referred to in Verbatim Record, Page 206. Printed on Page 322, Dec. 12 issue.
Photostatic reproduction of 40 Pages of contract or general agreement between the Hartford-Empire Company and the Northwestern Glass Co. Exhibit No. 119. Referred to in Verbatim Record, Page 206. Printed on Page 326 of Dec. 12 issue.
Photostatic reproduction of 30 pages of a contract between the Hartford-Empire Company and the Laurens Glass Works, Inc., of Laurens, S. C., dated June 9, 1924, Exhibit No. 120. Referred to in Verbatim Record, Page 207. Printed on Page 333 of Dec. 12 issue.
Photostatic reproduction of 30 pages of a contract between the Hartford-Empire Company and the Whitall-Tatum Company of Millville , N. J., dated Jan. 21, 1935. Exhibit No. 121. Referred to in Verbatim Record, Page 208. Printed on Page 338 of this issue.
Agreement covering use of patented "Stackers and Conveyers", between the Hartford-Empire Company and the Owens-Illinois Glass Company, a printed pamphlet of 24 pages, Exhibit No. 122. Referred to in Verbatim Record, Page 208. Printed on Page 341 of this issue.
Letter of four typed pages, dated August 26, 1932. Addressed to S. S. Searcy, San Antonio, Texas, Attorney, by the Hartford-Empire Company, Exhibit No. 123. Referred to in Verbatim Record, Page 211. Discusses price policies of the Three Rivers Glass Company. Printed on Page 343 of this issue.
Memorandum as to the history and policies of the Hartford-Fairmont and Hartford-Empire Companies, dated March 26, 1928, taken from the files of the latter company. A photostatic reproduction of six pages. Exhibit No. 124. Referred to in Verbatim Record, Page 211. Printed on Page 343 of this issue.
A memorandum, "Policy of the Hartford-Empire Company," a pamphlet of 30 pages, dated Feb. 18, 1930. This pamphlet, taken from the files of the company, discusses the development of its patent and license policies and summarizes its attitude in such fields. Exhibit No. 125. Referred to in Verbatim Record, Page 216, and printed on Page 345 of this issue.
A letter dated April 1, 1935, taken from the files of the former Illinois Glass Company, Alton, Ill., addressed to Mr. R. H. Levis of that company and signed by Mr. W. E. Levis, discussing action taken at a directors meeting of the Hazel-Atlas Glass Company at Wheeling. Referred to in Verbatim Record, Page 250, as Exhibit No. 126. Page 252 of the Dec. 13 issue.
Schedule of Owens-Illinois Glass Company payments to and receipts from the Hartford-Empire Company, from 1924 to 1937. Exhibit No. 127. Referred to in Verbatim Record, Page 255. Printed on Page 275, of the Dec. 12 issue.
Letter dated Jan. 13, 1933, from Mr. William E. Levis, Owens-Illinois Glass Company, to Mr. F. Goodwin Smith of the Hartford-Empire Company, discussing applications for licenses for the making of beverage bottles. Exhibit No. 128. Referred to in Verbatim Record, Page 263. Printed on Page 275 of the Dec. 14th issue.
Letters exchanged between Aubrey L. Romine and the Owens-Illinois Glass Company, regarding the purchase of machinery for a glass manufactory, Exhibits Nos. 129 and 130, and letters from the company to Mrs. Len Smith of Los Angeles and to the Sparks Construction Company, New York City, regarding the sale or license of like machines, Exhibits Nos. 131 and 132. Printed on Pages 263 and 264, of the Dec. 14 issue.
Letters from Mr. William E. Levis dated Aug. 2, 1932, to Mr. R. H. Levis of the Illinois Glass Consolidated Corporation, Alton , Ill. , discussing sale of Owens-Illinois debentures and possible investment by the Illinois Company in common stocks of the Hazel-Atlas Glass Company and in the preferred stock of the Thatcher Manufacturing Company. Exhibit No. 133. Referred to in Verbatim Record, Page 264. Printed of Page 275 of the Dec. 14th issue.
Memorandum, dated April 12, 1930, stating that the Hartford-Empire and Owens-Illinois companies shared expenses of suits brought by the first company against competitors in the glass industry over alleged patent infringements. Exhibit No. 134. Referred to in Verbatim Record, Page 265, and printed in this issue on Page 349.
Photostatic reproduction of six pages of a contract, July 1, 1932, between Hartford-Empire and Owens-Illinois, a license agreement on suctions inventions. Exhibit No. 139. Referred to in Verbatim Record, Page 269, and printed on Page 350 of this issue.
Summary by Chairman O'Mahoney
of the Temporary National Economic
Committee, of the evidence
educed as to the patent situation
in the glass container industry,
made public Dec. 15, following
the adjournment of the hearings.
IN so far as evidence has been presented to date, and without attempting to be inclusive, let me note a few points developed at these hearings into the patent situation in the glass container industry which have impressed me. I should stress that these points are not made critically nor with reference, at this time, to the economic and social advantages or disadvantages of the practices mentioned.
First, may I emphasize the Committee's appreciation of the candid quality of the testimony we have heard . Our best chance for a just solution of basic problems rests on this candor. In investigations, it is often difficult to get facts, not because of untruthfulness of witnesses, but because of what may be natural reluctance to be fully expressive in terms which we all can understand. Here, I have observed an intention on the part of witnesses to lay the cards on the table, and I believe this attitude is generated by a desire to assist the members of the Committee in understanding a broad economic problem which every one must acknowledge is, at best, difficult. Cooperation takes on real meaning when it is expressed in such concrete terms.
EFFECT ON COMPETITION
1. Here is an industry in which com-petition is substantially affected by patent control. Here is an industry I say this without invidiousness where the method of employing patents has resulted in a sort of private NRA.
2. This control is employed to adjust and allocate production. According to the witnesses, an overall industry over capacity is maintained , but is carefully supervised.
3. Although the witnesses expressly disavowed any attempt directly to regulate price, it is clear that indirectly, at least, prices are stabilized through production control and that prices are further stabilized through the practice of producers to follow the prices of the largest producer of particular classes of glass containers.
4. Through the refusal to grant licenses, persons desiring to enter the industry have not been allowed to do so by those in control of the patents.
5. As a result of litigation, rendered possible by the present state of the law of patents, certain producers have been eliminated from the business, or have been purchased wholly or in part, by large interests following litigation or other pressures. No comment is intended here with respect to the justification of the litigation or the other pressures.
6. It should be pointed out that persons with financial means and responsible connections have apparently been excluded from this industry.
The effect of this exclusion in some instances has been to limit the number of producers in given geographical areas.
A TEXAS CASE IS CITED
8. Those in control of patents are, as a result of the present state of the law, in a position to issue or refuse what amounts to a "certificate of convenience and necessity" to those who may desire to enter the industry. For example, we find that in one instance in Texas producers with Texas money, Texas raw material and Texas labor, were unable, because they could not secure a license from a corporation in Connecticut, to establish a Texas business. This incident tends to illustrate the extent to which development of natural resources of the West and South is hindered by artificial restraints.
9. The industry illustrates group or corporate control of patents as distinguished from their control by an individual. It should be pointed out that neither the corporate power nor the patent grant, both of which are privileges extended by public agencies, are subject to Federal supervision as such. I say this without intending to indicate whether or not there should be such supervision but simply to raise the question.
10. In some cases the evidence seems to indicate that the original intention of the patent grant as stated in the Constitution to promote the progress of science and useful arts has been obscured.
QUESTION OF POWER
The testimony elicited during these few days necessarily suggests many questions to those who have been following it. It may be asked, for example, whether or not patentees should be allowed to retain the power to attach restrictions as to production or price in any license that may issue for the use of devices protected by patent.
Another question is whether or not Congress should allow patents to issue upon basic processes many years after such processes have been in active use in an industry. Again, should there be any distinction in the treatment which Congress should accord to a natural person, an inventor, who himself develops a device and that which should be accorded to a group?
Those who have studied the patent law will probably be in general accord with the constitutional theory that patents like copyrights should be granted as a stimulus to industry and genius to "promote the progress of science and the useful arts," and I am sure the evidence which has been presented to this Committee will be widely studied throughout the country with a view to determining whether or not the present law does not lend itself toother purposes.
Perhaps I should say that this summary reflects only my own opinion. It should further be noted that the Department of Justice and other agencies are making additional patent studies, so that, of course, no conclusions are possible.
Appendix
(Exhibit No. 118)
(Received in evidence Dec. 12. Verbatim
Record Page 206)
License and lease No. M. F. 26 from
Hartford-Empire Company to
Antonio Scalise, doing business
as the Florida Glass Manufacturing
Company, dated August 2, 1935,
Miller Feeder No. 75.
PREAMBLE THIS LICENSE AND LEASE, made this 2nd day of August, 1935, between the HARTFORD-EMPIRECOMPANY, a corporation organized under the laws of the State of Delaware and having a place of business at Hartford, Connecticut, hereinafter designated as LICENSOR, and Antonio Scalise, doing business as the Florida Glass Manufacturing Company and having a place of business at Jacksonville, Florida, herein-after designated as LICENSEE.
WITNESSETH: That whereas the Licensor owns or controls certain Letters Patent of the United States set forth in Schedule E annexed hereto and certain applications now pending for Letters Patent of the United States, relating to the manufacture of glassware, and
WHEREAS the Licensee is engaged in manufacturing glassware, having a plant for that purpose at Jacksonville, Florida, and desires to use machinery embodying inventions shown in said letters patent and patent applications in said business at said plant, which machinery is described in Schedule A annexed hereto, hereinafter termed "the leased machinery"
NOW, THEREFORE, in consideration of the covenants and royalties herein after set forth, it is hereby mutually agreed as follows:
SECTION 1. EXTENT OF LICENSE AND LEASE
The Licensor hereby leases to the Licensee and hereby licenses the Licensee to use the said leased machinery. PROVIDED, HOWEVER, that this license and lease is limited (not absolute) , and confers only the right to use said leased machinery in continental United States, and in the manner and for the purpose hereinafter set forth, and not otherwise.
It is agreed between the parties hereto that no obligation whatsoever rests upon or is assumed by the Licensor that other machinery and equipment of the Licensee or of others will operate successfully or efficiently in conjunction with the said leased machinery of the Licensor.
(Secs. 2-3 deleted)
SECTION 4. TERM
The term of this license and lease, unless sooner revoked or terminated as provided elsewhere herein, shall be for an initial period of Eight (8) years from the date of this license and lease, with privilege, if claimed by the Licensee in writing before the expiration of the said initial period, of one renewal for a supplemental period of Eight (8) years, upon all the conditions hereof, except as to installation and further renewal, and without additional license fee for such renewal.
SECTION 5. LICENSOR RETAINS TITLE
It is understood and agreed that the licensor and its successors and assigns, holds and at its own option, shall continue to retain throughout the term of this license and lease, complete title to said leased machinery.
SECTION 6. PLACE AND NATURE OF USE
Said leased machinery and all improvements thereon shall be used only for manufacturing the glassware defined as "Permitted Ware" in Schedule "C" annexed hereto, and only at said plant of Licensee located at Jacksonville, Florida, or at any other plant owned by the Licensee. Said leased machinery and all improvements thereon shall be used for delivering glass to only one forming machine, and not otherwise.
SECTION 7. PROHIBITION OF ASSIGNMENT
The said leased machinery shall be used only by the Licensee or its operatives. Neither the said leased machinery nor this license and lease shall be transferred, assigned or sub-let by the Licensee, except to the purchaser of the entire business of the Licensee. If either be otherwise transferred, assigned or sub-let, or if the Licensee discontinues for a period of more than one year the production of glassware under this license and lease, or is adjudicated bankrupt, or receiver is appointed over it, or if the Licensee makes any general transfer or assignment for the benefit of creditors, then and in any such case this license and lease may, at the option of the Licensor, be terminated.
SECTION 8. CHANGES, ADDITIONSAND IMPROVEMENTS
No changes and no additions other than reasonable and necessary repairs and other than necessary or proper safety appliances, shall be made in or to said leased machinery except by consent of both parties to this license and lease, or except as provided in Section 16 hereof for the event of injunction, and except as provided in this Section for improvements; and all changes and additions when made, shall become the property of the Licensor. Complete title to all patent rights at anytime possessed during the term of this license and lease by the Licensee covering such changes and additions shall be transferred to the Licensor.
In such event the Licensor will, upon written request of the Licensee, furnish to the Licensee with reasonable promptness, such parts as may be needed to apply the said improvements to the said leased machinery and at prices similar to those charged by Licensor for such parts to other similar licensees. Such improvements shall be used by the Licensee only in or upon the said leased machinery, and only during the term of this license and lease. All parts displaced from said leased machinery by the said improvements shall be returned to the Licensor.
The word "improvements" when used in this license and lease, shall be held to mean only (1) substitution of new parts for old parts of said leased machinery; or (2) changing old parts thereof; or (3) addition of new devices which are intended and adapted to become integral portions of such machinery and to perform only one or more of the original functions of such machinery; and not otherwise.
SECTION 9. ACCOUNTING.
The Licensee shall keep proper books of account during its entire operation under this license and lease, showing the length of time that said leased machinery is operated each day, and the number, kinds and sizes of glassware produced each day by said machinery, and all other facts necessary or advantageous for carrying out the purpose of this license and lease, together with a semi-annual statement showing the detailed cost of such production for the preceding six months, all in such form, within reasonable limits, as shall be specified by the Licensor.
Such books shall at all reasonable times be open to the inspection of the Licensor, or its duly authorized agents. The Licensee shall, on or before the tenth day of each month, furnish to the Licensor upon blanks provided by the latter, properly certified detailed statements giving in itemized form all the data mentioned in this Section , so far as may be required by the Licensor, for the preceding calendar month, except as to said costs of production, which shall be reported semi-annually, as above provided.
SECTION 10. ROYALTIES.
The Licensee shall pay to the Licensor during the term of this license and lease, royalties on all merchantable glassware produced by or with the aid of said leased machinery from the completion of its installation, at rates per gross, for the respective items of ware, as provided in Schedule "D" annexed hereto.
All of said royalties shall be paid monthly, at the Licensor's office in New York funds, on or before the fifteenth day of each month, for and upon all merchantable glassware manufactured by the Licensee under this license and lease, during the preceding calendar month.
SECTION 11. MINIMUM ROYALTY.
The said Licensee shall pay in royalties a minimum royalty under this license and lease of not less than Fifteen Hundred (1500) Dollars per year to be payable in New York funds, on or before the fifteenth day of January, for the year last preceding, during the entire term of this license and lease, including the said supplemental period, if entered upon, of Eight (8) years, subject to the provisions of Section 18.The first and last payments hereunder shall be prorated according to the number of months. during which such minimum royalty shall have actually been accruing in the first and last calendar years respectively.
SECTION 12. INSURANCE-TAXES-LIABILITY FOR INJURY.
The Licensee shall also at its own expense, procure and place in the hands of the Licensor good policies of insurance against fire to the amount of the full insurable value of said leased machinery, payable in case of loss to the Licensor; shall also pay all taxes assessed against said leased machinery, and shall hold and save the Licensor harmless against any and all damages and costs resulting from injury occurring to any of the said Licensee's employees or others on account of or in connection with said leased machinery, subsequent to the installation thereof.
SECTION 13. OPERATION OF MACHINERY.
The Licensee shall keep, use and operate said leased machinery and all parts thereof in a careful, safe, prudent, and proper manner; shall maintain the same in good order, damage by fire excepted as hereinafter set forth; shall not without consent of the Licensor, add to or subtract from such leased machinery as supplied by the Licensor, excepting necessary or proper safety appliances, or allow changes to be made therein, or interfere with the proper operation thereof, or remove or deface any plates, dates, numbers or inscriptions placed thereon by the Licensor.
Licensee shall make prompt repairs or renewals when the same are necessary, but shall not be required to purchase the necessary parts from Hartford, nor shall Hartford be obliged to furnish such parts.
(Sec. 14 deleted)
SECTION 15. ACKNOWLEDGING VALIDITY OF PATENTS.
(a) So long as this License remains in force, the Licensee agrees not to dispute the validity of the Letters Patent under which this License is granted, some of which are set forth in Schedule E annexed hereto, so far as these patents apply to the methods and machines which are hereby licensed to the Licensee.
(b) In case a final decree shall declare to be void all or substantially all of the Licensor's patents embodied in and relating to the said leased machinery, so that the Licensee is thereby evicted from all or substantially all of the benefits of this license and lease, then and in that case the Licensee may at its option revoke and terminate this license and lease, in which event the Licensee shall thereupon restore to the Licensor all of the said leased machinery and its appurtenances as provided in Section 19 hereof, and shall thereupon be relieved from paying further minimum royalties. PROVIDED, however, that until such revocation and restoration the Licensee shall continue to be bound by all the covenants and provisions of this license and lease.
SECTION 16. PROTECTION OF LICENSEE FROM INFRINGEMENT CLAIMS-LIABILITY FOR NON-PERFORMANCE
(a) The Licensor will at its own expense save and hold the Licensee harmless against damages and costs recovered in any suits or claims brought against the Licensee for alleged infringement of patents based on the use of the said leased machinery, but only to the extent of the royalties which shall have been paid by the Licensee during and for the period of infringement and before the judgment for such recovery, said period not to exceed, however, the twenty-four months immediately preceding such judgment. The Licensor shall, upon the written request of the Licensee, defend any such suits or claims, unless or until the Licensor shall elect to effect a settlement thereof. The Licensee shall promptly inform the Licensor of any such suit or claim, or any threat or probability thereof, coming to the knowledge of the Licensee, and shall, at the Licensor's expense, full and freely aid the Licensor in defending the same; and shall further promptly inform the Licensor of any infringement of the Licensor's patents coming to the knowledge of the Licensee.
(b) The Licensor shall have the right to intervene in and defend, as a party thereto, any suit brought against the Licensee during the term hereof which involves any contention that the making, selling or use of such leased machinery, or any improvement or part thereof, constitutes an infringement of any patent.
(c) In case the Licensor shall be delayed in the performance of, or be rendered unable to perform all or any part of this license and lease, by reason of strikes, unavoidable accident, the non-arrival of machines or materials, or if the installation or operation of said leased machinery shall be delayed or stopped by the process or order of any court of competent jurisdiction, the Licensor shall not be liable to the Licensee for any losses, delay or damage incurred thereby, except for damages recovered for infringement as set forth and limited above in this Section, PROVIDED, however, that if the right of the Licensee to use the said leased machinery, or any part thereof, shall be suspended by reason of an order, decree or injunction issued by any court of competent jurisdiction, then during the continuance of restraint by such order, decree or injunction, or until the Licensor shall have substituted other machinery or parts as hereinafter set forth, which said Licensor agrees to do as promptly as reasonably possible, the minimum royalty asset forth in Section 11 hereof shall be waived.
(d) In the event of such an order, decree or injunction being issued against any part or parts of said leased machinery, the Licensor reserves the right to substitute with reasonable promptness other machinery or parts for those involved in the injunction and at no cost or charge to the Licensee excepting any licensing fee or royalty which the Licensor may have to pay for the right to make, and license the Licensee to use, such other machinery or parts. The part or parts so substituted shall be of an efficiency substantially equal to that of the part or parts so involved in said order, decree, or injunction and shall immediately become subject to all the provisions of this license and lease.
(e) In the event that such order, decree or injunction shall become permanent against any part or parts of said machinery, and no substitution of machinery or parts shall have been made with reasonable promptness as above stated ,then in that event this license and lease shall cease and terminate in all its provisions.
SECTION 17. RIGHT OF REVOCATION.
In case the Licensee shall violate or fail to observe any of the conditions set forth in Sections 1, 3, 6, 7, 8, 9, 10, 11,12, 13, 15 , 20 and 21 of this license and lease, or shall cause the same to be violated, the Licensor shall have the right at its option, to revoke and terminate absolutely, this license and lease upon giving written notice to the Licensee of said revocation at least thirty (30) days before the time when such revocation is to take effect.
Except as provided in Sections 15, 16, 18 and 21, no termination or revocation whatsoever of this license and lease under any section hereof, nor the use of the remedy of injunction, accounting or repossession shall, however, affect or in anyway discharge the liability of the Licensee hereunder, to pay and to continue to pay to the Licensor, the minimum royalty provided by Section 11 hereof, for and during the entire term of this license and lease, including its supplemental eight-year period if entered upon, nor shall any royalties paid by said Licensee be returned.
SECTION 18. COMMUTATION OFMINIMUM ROYALTIES.
It is further agreed that in the event of such revocation set forth in Section 17,the Licensee, in lieu of said obligation therein provided to pay the said minimum royalties throughout said entire term, may at its option wholly discharge said obligation by paying to the Licensor within sixty days after said revocation, a lumpsum equal to fifty (50) per cent of the total minimum royalties which would under this license and lease be payable during the remainder of said term, including its said supplemental period if entered upon; and provided further, that the Licensee may at any time during said term, including said supplemental period, revoke and terminate this license and lease in its option, by giving written notice to the Licensor sixty (60) days beforehand of its intention so to revoke and by paying to the Licensor within said sixty days a lumpsum in discharge calculated as above set forth in this Section.
SECTION 19. RE-POSSESSION OFTHE MACHINERY.
Upon the termination of this license and lease at the end of its initial or supplemental period, or sooner as herein provided, the Licensee shall return to the Licensor the said leased machinery and all appurtenances thereof, covered by this license and lease, in good condition, reasonable wear and use excepted, by delivering the same properly crated and packed f. o. b. cars at any convenient freight station near the plant of the Licensee. If said Licensee shall fail so to deliver the machinery, the Licensor is hereby authorized to enter upon any premises where the said leased machinery maybe and take possession thereof and remove it.
SECTION 20. INSPECTION.
Duly authorized agents or employees of the Licensor shall at all reasonable times be allowed access to the said leased machinery for the purpose of inspecting the same and its operation and use, and the Licensee shall afford all reasonable facilities therefor.
SECTION 21. FIRE LOSS.
(a) In the event that the said leased machinery shall be damaged by fire so as to cause a suspension of production therewith the Licensee shall immediately give written notice to the Licensor as to the extent and nature of the damage to the said machinery and as to the plans and intentions of the Licensee relative to repairing the damage and resuming operations under this license and lease.
(b) In the event of such damage by fire, the Licensor, if so requested in the said notice, shall at its own expense, and to an extent not exceeding the amount of insurance received, provide the Licensee with the machinery or parts thereof necessary to repair or replace the damaged machinery or parts. The Licensee shall at its own expense promptly and diligently proceed to install the said machinery or parts thereof. From the time when said notice is received by the Licensor and thereafter during only such time, not exceeding six months, as may be necessary for providing and installing the said machinery or parts, the minimum royalty set forth in Section 11 hereof shall be waived.
(c) If the Licensee shall not within six (6) months after the occurrence of the fire rebuild or otherwise repair the damage and resume operation under this license and lease, or if the Licensee shall fail to resume the payment of royalties when due, then in any of these cases the Licensor shall have the right at its option to revoke and cancel this license and lease.
(Sect. 22 deleted)
SECTION 23. WAIVING OF CONDITIONS.
None of the terms of this license and lease shall be held to have been waived or altered unless such waiver or alteration is in writing, signed by an officer of the Licensor, expressly authorized thereto.
IN WITNESS WHEREOF each of the parties hereto has caused this license and lease to be executed in duplicate, in its name and behalf, as of the day and year first above written, the Hartford-Empire Company, by Arthur T. Safford, Jr., Secretary, and Antonio Scalise, doing business as the Florida Glass Manufacturing Company, Licensee, both thereto duly authorized.
SCHEDULE A.
Annexed to License and Lease No. M. F.26, Dated Aug. 2, 1935.
Description of machinery licensed and leased.
Miller Feeder No. 75 A certain feeder located at the plant of Licensee known as the Miller Feeder, and to which will be attached Hartford-Empire number plate designating said feeder as Type No. 10, Serial No. 75.
(Schedule B deleted)
SCHEDULE C.
Annexed to License and Lease No. M. F. 26, Dated Aug. 2, 1935.
Specification of glassware which maybe made.
PERMITTED WARE.
The ware to be produced hereunder shall comprise (except as expressly excluded below under "Exclusions") all the articles named under this heading of Permitted Ware and made of the compositions of glass now commonly used for such articles, whether flint, blue, amber or green (but excluding opal), and not exceeding one hundred twenty-eight (128) ounces in weight.
1. Milk and cream bottles; PROVIDED, however, that Licensee shall not produce in any calendar year on any and all feeders licensed to it by Licensor more than Twenty-one Thousand (21,000) gross of such bottles, and PROVIDED further that the first and last year's production hereunder shall be prorated according to the number of months during which this License and Lease shall have been in effect in the first and last calendar years respectively.
2. Cheese jars for dairies.
3. Bottles for pressure beverages, not to include, however, bottles for carbonated water nor siphon bottles; PROVIDED that Licensee shall not produce in any one calendar year on any and all feeders licensed to it by Licensor more than a total of Seven Thousand (7,000) gross of these bottles, the manufacture of which is hereby permitted, and PROVIDED further that the first and last year's production hereunder shall be prorated according to the number of months during which this License and Lease shall have been in effect during the first and last calendar years respectively."
4. Bottles for proprietary medicines, but not to include prescription bottles.
5. Liquor ware.
6. Wines.
7. Beers.
8. Containers for foods, limited, however, to the following: (a) Mayonnaise; (b)Peanut Butter; (c) Honey; (d) Preserves; (e) Syrups.
Finishes having distinctive screw threads known as the "G" 70mm, and the 87 5/16 mm. wide-mouth Mason finishes capable of hermetically sealing on a sealing shoulder with regular standard Mason "G" and wide-mouth caps or on the top edges with glass or metal lids and screw thread bands shall not be formed on any of the articles the production of which is permitted above under the heading "Permitted Ware."
EXCLUSIONS.
The following articles are expressly excluded and shall not be produced under this license:
(a) Bulbs and tubing and cane all when for use in the manufacture of incandescent electric lamps or for any other permanently sealed enclosure for electrical purposes.
(b) Signal and optical ware.
(c) Ware intended and adapted for use where the heat resistance, physical strength, chemical resistance or electrical properties of such ware are of substantial value, provided such ware is made from glass having a linear coefficient of thermal expansion of less than .000006 per degree Centigrade, or containing more than five per cent boric oxide, or having an electric strength or thermal endurance or chemical resistance higher than a glass containing 80 per cent silica, 10 per cent sodium oxide, 5 per cent boric oxide and5 per cent calcium oxide.
(d) Ware intended and adapted forholding food in the process of cooking or sterilizing, other than ware intended and adapted for packages for storage and sale of goods or for transportation of goods .
(e) Mold-blown articles of glass insofar as the same are or may be used for electrical purposes or in connection with electric illumination.
(f) Ware which is pressed and not blown.
(g) Nursing bottles.
(h) Tumblers; fruit jars; lantern globes; gas globes; chimneys; vault lights; battery jars and battery containers; fish globes; display jars; tablet jars; insulators and drawn tube and cane.
Definition of Fruit Jars The term "fruit jars," as used herein, shall mean fruit jars for domestic (household) use, which, as defined herein, shall mean generally the term as used in the glass industry the intent being to include all kinds and sizes of the regular Mason jar with sealing shoulder with screw thread that fits regular Mason fruit jar caps; Lightning style fruit jars; and other sealing jars, intended to be shipped to the trade to be sold empty to the ultimate consumer, either with or without caps; but not to include jars manufactured for packers to be filled by them before selling to their trade.
(i) Marbles and Lithographers' balls.
(j) Vacuum bottles.
SCHEDULE D.
Annexed to License and Lease No. MF26, Dated August 2, 1935.
PROVIDED, however, that the following rates of royalty shall apply to milk and cream bottles
The royalty rates on milk and cream bottles shall be twenty cents (20c) per gross for the one quart size; fifteen cents (15c) per gross for the one pint size; and twelve cents (12c) per gross for the one-half (1/2) pint size and ten cents (10c) per gross for the one-quarter (1/4) pint size, and for other sizes a royalty proportioned by weight of product to the royalty for the nearest size of bottle for which rates are specified in this paragraph.
The quart referred to above is the so-called United States standard quart containing thirty-two (32) fluid ounces, and the pint is of sixteen (16) fluid ounce capacity.
SCHEDULE E.
Annexed to License and Lease No. MF-26, Dated August 2, 1935.
LIST OF PATENTS.
1,326,460, Dec. 30, 1919; 1,382,993, June 28, 1921; 1,382,994, June 28, 1921; 1,414,561, May 2, 1922; 1,421,810, July 4, 1922; 1,473,587, Nov. 6, 1923; 1,516,220, Nov. 18, 1924; 1,519,885, Dec. 16,1924; 1,524,638, Jan. 27, 1925; 1,558,790, Oct. 27,1925; 1,564,909, Dec. 8. 1925; 1,573,742, Feb. 16, 1926; 1,574,709, Feb. 23, 1926; 1,574,739, Feb. 23, 1926; 1,588,393, June 8, 1926; 1,589,304, June 15, 1926; 1,590,924, June 29, 1926; 1,596,438, Aug. 17, 1926; 1,600,962, Sept. 21, 1926; 1,603,974, Oct. 19, 1926; 1,604,000, Oct. 19, 1926; 1,608,967, Nov. 30, 1926; 1,626.705, May 3, 1927; 1,628,324, May 10, 1927; 1,629.409, May 17, 1927; 1,631,107, May 31, 1927; 1,644,893, Oct. 11, 1927; 1,655,391, Jan. 3, 1928; 1,656,869, Jan. 17 , 1928; 1,662,436, March 13, 1928; 1,732,773, Oct. 22, 1929; 1,735,837, Nov. 12, 1929; 1,737,165, Nov. 26, 1929; 1,760,254, May 27, 1929; 1,760,255, May 27, 1929; 1,760,435, May 27, 1929; 1,781,340, Nov. 11, 1930; 1,788,413, Jan. 13, 1931; 1,816,309, July 28, 1931; 1,864,275, June 1, 1932; 1,864,276, June 21, 1932; 1,864,277, June 21, 1932; 1,864,278, June 21, 1932; 1,864,279, June 21, 1932; 1,873,021, Aug. 23, 1932; 1,873,022, Aug. 23, 1932.
It is recognized, however, that this Schedule E may not be complete in its recital of all the patents under which the License is granted.
February 6, 1936.
Florida Glass Manufacturing Company
Jacksonville, Florida
Gentlemen: After reviewing the milk royalties which you paid us for the twelve months ending December 31, 1935, we have decided to offer to you as a milk bottle licensee, the opportunity to apply as a royalty to your milk bottle production, our standard blown and pressed and blown ware rates instead of the present milk bottle rates. From our analysis of your royalty reports for this last year, this will result in a royalty saving to you.
The application of these rates will workout as follows:
The pressed and blown rate for quart milks is 20 cents per gross and the quart milk bottle weighs 25½ ounces. Taking the standard pressed and blown ware rate, a quart weighing 25½ ounces falls into the bracket "Over 20 oz. wt. and not exceeding 26 oz. wt.", and will carry a royalty of 18 cents per gross or 2 cents less than the royalty figured on the milk bottle rate.
For pints weighing 15½ ounces, the rate works out the same 15 cents under each schedule; for half pints, the standard blown ware rate based on a 10 ounce weight is 1 cent more. So long, therefore, as your annual production retains the same general proportion of quarts, pints and half pints as in the past, we believe the offered rate will result in a decided advantage to you.
You of course will desire to check your own figures. Our figures as applied to your production, show that based on your 1935 figures, the offered rate will realize a royalty saving of $66.86.
If this change appears desirable to you, will you be good enough to sign both copies of this letter and return one of them to us for our files.
In consideration of the mutual advantages accruing to Hartford-Empire Company and Florida Glass Manufacturing Company from the foregoing change, Hartford and Florida agree that Schedule D of License and Lease No. M-26 and 27 dated August 2, 1935, is hereby amended by striking out the proviso in said Schedule commencing with the words, "Provided, however," and continuing through the words "fluid ounce capacity," inclusive. This change shall take effect as of January 1, 1936.
Yours very truly,
HARTFORD-EMPIRE COMPANY.
By (S) ARTHUR T. SAFFORD, JR.
Jacksonville, Florida,
February 10, 1936.
Florida Glass Manufacturing Company hereby enters in and agrees to the foregoing.
FLORIDA GLASS MANUFACTURING COMPANY.
By (S) A. SCALISE.
May 7, 1936
Florida Glass Manufacturing Co.
Jacksonville, Florida
Attention: Antonio Scalise
Gentlemen: We have decided to make an adjustment of our standard Feeder Royalty Rates for Blown and Pressed and Blown glassware in weights of One and One-half (12) Ounces or less as shown in the Schedule of your Feeder Royalties attached to both copies hereof.
It is understood that all other royalty rates now in force remain unchanged.
This adjustment is to become effective May 1, 1936, but will not go into effect until you sign this letter as requested below to show your acceptance of the adjustment and the conditions upon which it is made.
The same adjustment subject to the same conditions is being offered to all Licensees.
Therefore, please sign both copies of this letter, returning one copy to us for our files. This will then serve to amend your Feeder Royalty Rates to agree with the attached Schedule.
Very truly yours,
HARTFORD-EMPIRE COMPANY.
By (S) Arthur T. Safford, Jr.,
Secretary.
Jacksonville, Florida,
May 12, 1936.
Florida Glass Manufacturing Company hereby accepts the foregoing amendment subject to all the conditions thereof.
FLORIDA GLASS MANUFACTURING COMPANY
By (S) A. Scalise
Jacksonville, Florida,
May 12, 1936.
Schedule of Feeder Royalties attached to letter to Florida Glass Manufacturing Company dated May 7, 1936:
March 31, 1937.
Florida Glass Manufacturing Company,
Jacksonville, Florida.
Attention: Mr. Antonio Scalise
Gentlemen: In accordance with Mr. A. M. Pease's discussion with you when he visited you recently in Florida, it is in order to amend Schedule C of your Licenses and Leases Nos. MF-26 and 27 dated August 2, 1935, and covering Miller Feeders Nos. 75 and 76, and also to amend Schedule C of the Forming Machine Agreement of the same date.
The purpose of this amendment is to increase the limit on your production of milk and cream bottles and to add Orange Juice Bottles to your Field of Ware. Therefore, it is hereby agreed that Schedule C of the above agreements under the heading "Permitted Ware" shall be amended by rewriting paragraph 1 thereof as follows :
"1. Milk and Cream Bottles intended and adapted for use by dairies, PROVIDED, however, that Licensee shall not produce in any calendar year on any or all machines licensed to it by Licensor, more than Twenty-seven Thousand, Five Hundred (27,500) gross of such bottles."
Said Schedules C shall be further amended by the addition thereto of the following item:
"9. Orange Juice Bottles for dairies."
* * * * * *
Please sign both copies of this letter in the spaces provided below, returning one copy of the letter to us for our files.
This amendment is to take effect as of January 1st, 1937.
Very truly yours,
HARTFORD-EMPIRE COMPANY.
ARTHUR T. SAFFORD, JR.,
Secretary.
Jacksonville, Florida,
March 31st, 1937.
Florida Glass Manufacturing Company hereby concurs in and accepts the foregoing, subject to all conditions thereof.
FLORIDA GLASS MANUFACTURING COMPANY
By A. SCALISE.
(Exhibit 119)
(Received in Evidence, Dec. 12. Verbatim Reports, Page 206.)
General agreement between
Hartford-Empire Company and the
Northwestern Glass Company,
dated August 1, 1933.
September 6, 1938
Northwestern Glass Company
5801 Marginal Way
Seattle, Washington
Attention: Edw. S. Campbell, President
Gentlemen: According to the letter of Mr. A. M. Pease dated August 10, bleach bottles are to be added to your Field of Ware.
Therefore, it is agreed that schedule C of the General Agreement dated August 1 ,1933, shall be and is hereby amended under Permitted Ware by the addition to Item 5 Miscellaneous (Containers) of the following:
Bleach Bottles
If you would be good enough to sign both copies of this letter in the space provided below and return one copy to us, this will serve to formally amend the General Agreement in the above manner,
Very truly yours,
HARTFORD-EMPIRE COMPANY.
By (S) Arthur T. Safford, Jr.
Secretary
Seattle, Washington
September 1938
Northwestern Glass Company hereby agrees to and concurs in the foregoing.
NORTHWESTERN GLASS COMPANY
By (S) Edw. S. Campbell,
President
May 23, 1938.
Northwestern Glass Company
5801 East Marginal Way
Seattle, Washington
Attention: Edward S. Campbell,
President
Gentlemen:
Attention has been directed to the fact that O'Neill Feeder No. 15, formerly in operation at your plant, has been converted to a Meyer Feeder.
It is desired to make note of this change in the feeder construction in the contract and in our records, and rather than rewrite any of the papers relating to this feeder, the matter can best be covered by a simple amendment.
The type number of the feeder and the serial number should be changed from Type No. 33 and Serial No. 15 to Type No. 43 and Serial No. 3. One of the service men will install a new number plate in accordance with the change, or if one of our service men does not call at the plant in the next month or so, we will forward the plate directly to you to be substituted for the plate now on the feeder.
Before being changed, the feeder was covered by Individual License and Lease No. O-R-1, dated January 9, 1934. It is hereby agreed that said License and Lease shall be amended by changing the number thereof to MY-R-2 and by changing the description of the "glass feeding machine" to apply to one Meyer Feeder, Type No. 43. Serial No. 3.
Also it is agreed that Schedule A of the General Agreement, dated August 1, 1933, shall be amended in Paragraph 1 to apply to one O'Neill Feeder Type No. 33, Serial No. 16, and to 2 Meyer Feeders, Type No. 43, Serial Nos. 2 and 3.
Inasmuch as we have title to the feeder in question under the Bill of Sale dated August 1, 1933, and under Section 10 of the Agreement relating to changes, additions and improvements, no new Bill of Sale or amendment of the original Bill of Sale is necessary.
It would be appreciated if you would indicate your confirmation of and concurrence with the foregoing by signing both copies of this letter in the space provided below, returning one copy to us for our files.
Very truly yours,
HARTFORD-EMPIRE COMPANY.
ARTHUR L. SAFFORD, JR.,
Secretary
Seattle, Washington
Northwestern Glass Company hereby agrees to and concurs in the foregoing.
NORTHWESTERN GLASS COMPANY
By EDWARD S. CAMPBELL
President
May 7, 1936.
Northwestern Glass Company
Seattle, Washington.
Attention: Mr. Edward S. Campbell
Gentlemen: We have decided to make an adjustment of our standard Feeder Royalty Rates for Blown and Pressed and Blown glassware in weights of One and One-half (1 1/2) Ounces or less as shown in the Schedule of your Feeder Royalties attached to both copies hereof.
It is understood that all other royalty rates now in force remain unchanged, including the rates on Purely Pressed ware.
This adjustment is to become effective Mar 1, 1936, but will not go into effect until you sign this letter as requested below to show your acceptance of the adjustment and the conditions upon which it is made.
The same adjustment subject to the same conditions is being offered to all Licensees.
Therefore, please sign both copies of this letter returning one copy to us for our files. This will then serve to amend your Feeder Royalty Rates to agree with the attached Schedule.
Very truly yours,
HARTFORD-EMPIRE COMPANY.
By (S) Arthur T. Safford, Jr.
Seattle, Washington
May 12, 1936
Northwestern Glass Company hereby accepts the foregoing amendment subject to all the conditions thereof.
NORTHWESTERN GLASS COMPANY
By (S) Edward S. Campbell
(Note: Table at bottom of this page)
(No address named)
On July 16th Mr. A. Pease wrote to you stating that you would be permitted to manufacture certain bottles for spring water.
This letter is for the purpose of formally amending your license and lease agreement in accordance with the above-mentioned letter.
It is hereby agreed between Hartford-Empire Company and Northwestern Glass Company that the General Agreement dated August 1, 1933, as amended or modified by letters dated October 18, 1933, March 2, 1934, June 6, 1935, and June 17, 1935, shall be further amended by adding to Schedule C under the heading "Permitted Ware" the following item
"(12) Bottles for spring water; PROVIDED, however, that such bottles shall not exceed one quart capacity"
Would you be good enough to indicate your concurrence in the foregoing by signing both copies of this letter in the space provided below, returning one copy to us for our files?
Very truly yours,
HARTFORD-EMPIRE COMPANY.
A. T. Safford, Jr.
Secretary
JRH:RLB
Seattle, Washington, Aug. 5, 1935.
Northwestern Glass Company hereby agrees to and concurs in the foregoing.
NORTHWESTERN GLASS COMPANY
By Edward S. Campbell, Pres.
June 17, 1935
Northwestern Glass Company
Seattle
Washington
Attention Mr. Edward S. Campbell
Gentlemen:
Mr. Pease has referred to us the matter of providing for a further amendment in the General Agreement to include candy jars and soaps within the Permitted Ware of Schedule C.
Therefore, it is hereby agreed between Hartford-Empire Company and Northwestern Glass Company that the General Agreement dated August 1, 1933, as amended or modified by letters dated October 18, 1933, March 2, 1934 and June 6, 1935, shall be further amended by adding to Schedule C under the heading "Permitted Ware" the following items
(10) Candy Jars
(11) Bottles for Soaps
Would you be good enough to indicate your concurrence in the foregoing by signing both copies of this letter in the space provided below, returning one copy to us for our files?
Very truly yours,
HARTFORD-EMPIRE COMPANY.
A. T. Safford, Jr.
Secretary
JRH:RLB
Seattle, Washington
June 21, 1935
Northwestern Glass Company hereby concurs in and agrees to the foregoing.
NORTHWESTERN GLASS COMPANY
By Edward S. Campbell
Pres.
June 6th, 1935
Northwestern Glass Company
Seattle
Washington
Attention Mr. Edward S. Campbell
Gentlemen:
In accordance with the letter of Mr. A. M. Pease dated June 4th, directed to Mr. Marsh, we are writing this letter to formally amend the General Agreement to add the items referred to in that letter.
Therefore, it is hereby agreed between Hartford-Empire Company and Northwestern Glass Company that the General Agreement dated August 1, 1933, shall be amended as to Schedule C by adding to said Schedule under the heading "Permitted Ware," the following items
(7) Crystal Bath Salts
(8) Disinfectants and insecticides, not to include, however, chlorine bleach solutions, such as Purex and Clorox ,or other similar bleach solutions
(9) Bottle for Lubricating Oils
Would you be good enough to indicate your concurrence in the foregoing by signing both copies of this letter in the space provided below, returning one copy to us for our files?
Very truly yours,
HARTFORD-EMPIRE COMPANY.
A. T. Safford, Jr.
Secretary
JRH:RLB
Seattle, Washington 6/12/35
Northwestern Glass Company hereby concurs in and agrees to the foregoing.
NORTHWESTERN GLASS COMPANY
By Edward S. Campbell
Pres.
March 2, 1934.
Northwestern Glass Company
Seattle
Washington
Attention Mr. E. S. Campbell
Gentlemen:
Upon recent consideration of the requirement for payment of minimum royalties in your contract, it was decided that it might be of advantage to you to permit a "spread" of royalties on your feeders.
This would relieve you of the obligation to pay a minimum royalty on any feeder for any year in which the total earned or production royalties on all feeders equals or exceeds the total mini-mum royalties on all your feeders, irrespective of the amount of earned royalties on any particular feeder.
It, therefore, is agreed between Hartford-Empire Company and Northwestern Glass Company that the minimum royalties provided for in Section 13 of the General Agreement dated August 1, 1933, in any one year shall be payable only in the amount that the total production royalties payable under the terms of Section 12 of said Agreement on all feeders now or hereafter licensed under said Agreement are less than the total minimum royalties payable on such feeders under the terms of said Section 13.
The foregoing amendment shall take effect as of January 1, 1934.Would you be good enough to sign both copies of this letter and return one of them to us for our files?
Very truly yours,
HARTFORD-EMPIRE COMPANY.
A. T. Safford, Jr.
Secretary
JRH:RLB
Seattle, Washington
March 1934.
Northwestern Glass Company agrees to and accepts the foregoing.
NORTHWESTERN GLASS COMPANY
By Edward S. Campbell
President.
October 18th, 1933.
Northwestern Glass Company,
Seattle, Washington.
Gentlemen :
Our Licensing Committee has recently concluded it to be advisable to reduce the royalty rates on purely pressed ware. In your case this will apply only to bowls for moth bait which is the only ware you are permitted to make by the purely pressed method.
Therefore, Hartford-Empire and Northwestern hereby agree that the General Agreement between Hartford-Empire Company and Northwestern Glass Company, dated August 1, 1933, shall be amended in respect to Schedule D thereof, by striking out the present paragraph entitled "Rates of Royalty" and inserting in place thereof the following:
(Table of Rates of Royalty at bottom of this page.)
This amendment shall take effect as of October 1, 1933.Would you be good enough to sign both copies of this letter in the space provided below and return one of them to us for our files?
Very truly yours,
HARTFORD-EMPIRE COMPANY,
A. T. Safford, Jr.,
Secretary.
ATS:RLB
Seattle, Washington,
October 24, 1933.
Northwestern Glass Company agrees to and concurs in the foregoing amendment.
NORTHWESTERN GLASS COMPANY,
By (Signed) Edward S. Campbell.
GENERAL AGREEMENT Between HARTFORD-EMPIRE COMPANY AND NORTHWESTERN GLASS COMPANY
This Agreement made and entered into this 1st day of August, 1933, between Hartford-Empire Company, a corporation of Delaware having its principal place of business at Hartford, Connecticut, (hereinafter called "Hartford") and Northwestern Glass Company, a corporation of Washington having its principal place of business at Seattle, Washington, (herein-after called "Northwestern").
WHEREAS Hartford is the owner of patents , patent applications and patent rights relating to glass-working machines and the manufacture of glassware, some of which are set forth in Schedule E annexed hereto, and is engaged in the development and the commercializing of inventions relating to such machinery and manufacture,
WHEREAS Northwestern is engaged in the manufacture of glassware and desires a certain license under Hartford's patents, patent applications and patent rights relating to the feeding of molten glass and the right to acquire certain of Hartford's equipment,
NOW, THEREFORE, in consideration of these premises and the covenants and royalties hereinafter set forth, the parties agree as follows
Section 1 Form of Individual License and Lease.
The Two (2) O'Neill and the One (1) Meyer Feeder described in Schedule A annexed hereto (hereinafter termed "original leased machines") are hereby agreed to be from the date hereof and are hereby leased and the use thereof licensed under this General Agreement. The leasing and licensing of said original leased machines, and the leasing and licensing of all Hartford Single Feeders furnished by Hartford to Northwestern under the terms of Section 2 below shall be evidenced for each of said machines and feeders by the issuance by Hartford to Northwestern of an individual license and lease in substantially the following form +
NORTHWESTERN GLASS COMPANY
Feeder License and Lease No. ___
This License and Lease No. ___ made the ____, day of 19 ___, between Hartford-Empire Company (hereinafter called "Licensor"), a corporation of Delaware having its principal place of business at Hartford, Connecticut, and the Northwestern Glass Company (hereinafter called "Licensee"), a corporation of having its principal place of business at Seattle, Washington, in consideration of the mutual covenants herein set forth and referred to
WITNESSETH
That the Licensor hereby leases to the Licensee and licenses the Licensee to use a certain glass feeding machine described as follows
This said License and Lease is made in pursuance of and with express reference to a certain General Agreement between Licensor and Licensee dated __________ 1933.
It is agreed between the parties hereto that the said machine shall be taken, in-stalled, held, licensed, leased, used, operated and returned subject to all the provisions of said General Agreement in so far as such provisions are by such Agreement made applicable to said machine and such provisions are expressly made a part of this License and Lease.
HARTFORD-EMPIRE COMPANY
By ____________________
In Presence Of
____________________
____________________
NORTHWESTERN GLASS COMPANY
By ____________________
____________________
____________________
Section 2 Substitution of Hartford Single Feeders. Northwestern shall have the right, at any time during the term of this General Agreement, to substitute a Hartford Single Feeder for each of said original leased machines, and upon such substitution shall discontinue permanently the use of the original leased machine for which substitution was made. Upon such substitution Northwestern agrees to return at once to Hartford the original leased machine for which substitution was made. Thereupon it shall be relieved from any further obligations for royalties of any sort thereafter accruing upon the original leased machine so substituted for, discontinued and returned.
If Northwestern shall elect so to substitute a Hartford Single Feeder for one of said original leased machines then in that event Hartford shall furnish to Northwestern for each of said original leased machines substituted for, permanently discontinued and returned a Hartford Single Feeder substantially as described in Schedule A annexed hereto, and such Hartford Single Feeder shall be leased and the use thereof licensed under this General Agreement. The license fee payable for each such feeder shall not be in excess of the amount charged by Hartford to others and shall be payable according to Hartford's standard terms.
As soon as the Hartford Single Feeder shall be furnished by Hartford to North-western in accordance with the terms of this Section an individual license and lease in the form set forth in Section 1shall be executed , and such feeder shall become a "substituted leased machine," as that phrase is hereinafter used.
Section 3 Preparation for Installation of the Hartford Single Feeder. Northwestern agrees, upon receiving drawings and lists showing locations and dimensions of the Hartford Single Feeder, to furnish and have ready proper floor space, foundations, connection between tank and forehearth, piping, shafting, tools, motor, power, and such other adjuncts and equipment as are required to the complete satisfaction of Hartford.
Section 4 Delivery and Installation of the Hartford Single Feeder. Hartford, as soon as reasonably possible, after the provisions of Section 3 shall have been complied with, shall furnish the Hartford Single Feeder to be obtained under the terms of Section 2 above f.o.b. rail shipment at place of manufacture, and shall aid in installing said feeder as provided in Schedule B annexed hereto. Northwestern agrees to proceed diligently with the installation of said feeder as soon as the same is furnished, and to accept it and pay royalties to Hartford as called for as to substituted leased machines by Sections 12 and 13 of this General Agreement.
Section 5 Extent of Agreement. Hartford hereby leases to Northwestern and hereby licenses Northwestern to use the said original leased machines and said substituted leased machines; PROVIDED, however, that such leasing and licensing is limited (not absolute) and confers only the right to use said original leased machines and said substituted leased machines in continental United States and in the manner and for the purpose hereinafter set forth, and not otherwise.
It is agreed between the parties hereto that no obligation whatsoever rests upon or is assumed by Hartford that other machinery and equipment of Northwest-ern or of others will operate successfully or efficiently in conjunction with said original leased machines and said substituted leased machines of Hartford.
Section 6 Title. It is understood and agreed that Hartford retains a complete title to all of said original leased machines and said substituted leased machines, and at its own option shall continue to retain complete title to such machines.
Section 7 Term. The term of this General Agreement and of all individual licenses and leases issued hereunder for said original leased machines and substituted leased machines, unless sooner revoked or terminated as provided elsewhere herein, shall be for an initial period of eight years from the date of this General Agreement, including the privilege, if claimed by Northwestern in writing before the expiration of said initial period, of One (1) renewal for a supplemental period of Eight (8) years upon all the conditions hereof.
Section 8 Place and Nature of Use. Said original leased machines and substituted leased machines and all improvements thereon shall be used only for manufacturing the glassware defined as Permitted Ware in Schedule C annexed hereto and to the extent and for sale only in the territory therein provided and only at the plant of Northwestern located at Seattle, Washington, or at any other plant owned by Northwestern. Each original leased machine and each substituted leased machine and all improvements thereon shall be used for delivering glass to only one forming machine at any one time.
Said original leased machines and said substituted leased machines shall be used only by Northwestern or its operatives.
Section 9 Prohibition of Assignment. Said original leased machines or said substituted leased machines, the individual licenses and leases covering them, or this General Agreement shall not be transferred, assigned or sub-let by Northwestern, except to the purchaser of its entire business. If any of them be otherwise transferred, assigned or sub-let by Northwestern, or if Northwestern discontinues for a period of more than one (1) year the production of glassware under this General Agreement, or is adjudicated bankrupt, or if a receiver is appointed over it, or if Northwestern makes any general transfer or assignment for the benefit of creditors, then and in any such case this General Agreement and all individual licenses and leases hereunder, or any one or more of them, may, at the option of Hartford, be terminated.
Section 10 Changes, Additions and Improvements. No changes and no additions, other than reasonable and proper repairs and other than necessary or proper safety appliances, shall be made in or to said original leased machines and said substituted leased machines, except by consent of both parties to this Agreement, or except as provided in Section 18 hereof for the event of injunction, and except as provided for in this Section for improvements; and all changes and additions when made to said original leased machines or to said substituted leased machines shall become the property of Hartford and fall within the provisions of this General Agreement. Complete title to all patent rights at any time possessed during the term of this General Agreement by Northwestern covering such changes and additions shall be transferred to Hartford.
Northwestern shall, during the term of this General Agreement, be given the benefit for the purposes set forth herein of any and all improvements for use in and upon said original leased machines and said substituted leased machines which may be devised, developed or acquired by Hartford if and when said improvements shall, with the express consent of Hartford, have been used commercially in the United States upon feeders of the same type as said original leased machines or said substituted leased machines in the making of glassware. In such event Hartford will, upon written request of Northwestern, furnish to Northwestern with reasonable promptness such parts as may be needed to apply the said improvements to said original leased machines or said substituted leased machines and at prices similar to those charged by Hartford to other similar licensees. Such improvements shall be used by Northwestern only in or upon said original leased machines or said substituted leased machines, and only during the term of this General Agreement.
The word "improvements," when used in this General Agreement, shall be held to mean only (1) Substitution of new parts for old parts of said original leased machines, or (2) Changing old parts thereof or (3) Addition of new devices which are intended and adapted to be-come integral portions of said machines and to perform only one or more of the original functions of said machines, and not otherwise.
Section 11 Accounting. Northwestern shall keep proper books of account during its entire operation under this General Agreement showing the length of time that each of said original leased machines and each of said substituted leased machines is operated each day, and the number, kinds and sizes of glassware produced each day by said machines, and all other facts necessary or advantageous for carrying out the purpose of this General Agreement.
Such books shall at all reasonable times be open to the inspection of Hartford or its duly authorized agents. Northwestern shall, on or before the Tenth (10th) day of each month, furnish to Hartford, upon blanks provided for by the latter, properly certified detailed statements giving in itemized form all the data mentioned in this Section so far as may be required by Hartford for the preceding calendar month.
Section 12 Royalties. Northwestern shall pay to Hartford during the term of this General Agreement royalties on all merchantable glassware produced by or with the aid of each of said original leased machines and said substituted leased machines at rates for the respective items of ware as provided in Schedule D annexed hereto. All of said royalties shall be paid monthly at Hartford's office in New York funds on or before the Fifteenth (15th) day of each month for and upon all merchantable glassware produced by Northwestern under this General Agreement during the preceding calendar month.
Section 13 Minimum Royalty. Northwestern shall pay in royalties a minimum royalty of Fifteen Hundred Dollars ($1500) per year upon each original leased machine and each substituted leased machine, which royalty shall be payable in New York funds on or before the fifteenth (15th) day of January for the year last preceding during the entire term of this General Agreement, including the said supplemental period, if entered upon, of Eight (8) years, subject to the provisions of Section 20.
The first and last payment of the minimum royalty shall be prorated according to the number of months during which such minimum royalty shall have actually been accruing in the first and last calendar years respectively. For each substituted leased machine the minimum royalty shall commence to accrue as of the same date when the minimum royalty of the original leased machine for which it is substituted shall cease, as provided in Section 2 above.
Section 14 Insurance, Taxes and Employees Liability. Northwestern shall also, at its own expense, procure and place in the hands of Hartford good policies of insurance against fire to the amount of the full replacement value of said original leased machines and said substituted leased machines payable in case of loss to Hartford.
Northwestern shall also pay all taxes assessed against the original leased machines and the substituted leased machines and shall hold and save Hartford harmless against any and all damages and costs resulting from injury occurring to any of Northwestern's employees or others on account of or in connection with said original leased machines or said substituted leased machines.
Section 15 Operation of Machinery. Northwestern shall keep, use and operate said original leased machines and said substituted leased machines and all parts thereof in a careful, safe, prudent and proper manner; shall maintain the same in good order, damage by fire excepted, as hereinafter set forth; shall not, without consent of Hartford, and except as provided below in this Section, add to or subtract from said original leased machines or said substituted leased machines, excepting necessary or proper safety appliances, or allow changes to be made therein or interfere with the proper operation thereof or remove or deface any plates, dates, numbers or inscriptions placed thereon by Hartford.
Northwestern shall promptly notify Hartford of the need of any repairs or renewals of said substituted leased machines and Northwestern shall at its own expense effect such repairs and renewals, purchasing the necessary renewal parts from Hartford; PROVIDED, however, that as to said original leased machines Northwestern shall make prompt repairs or renewals when the same are necessary, but shall not be required to purchase the necessary parts from Hartford or shall Hartford be obliged to furnish such parts.
As to renewal parts for said substituted leased machines Hartford agrees to furnish them promptly at prices not in excess of the prices charged by responsible outside parties for parts of similar design, material and workmanship. If Hartford declines or neglects so to furnish such parts Northwestern may procure them elsewhere.
Section 16 Inherent Defects. Hartford shall remedy and make good, without charge, any inherent defects appearing in the materials of each one of the substituted leased machines during one year from the date of its installation.
Section 17 Acknowledging Validity of Patents.
(a) So long as this General Agreement remains in force Northwestern agrees not to dispute the validity of the Letters Patent under which licenses are herein granted, some of which are set forth in Schedule E annexed hereto, so far as these patents apply to the methods and machines which are hereby licensed to Northwestern.
(b) In case a final decree shall declare to be void all or substantially all of Hartford's patents embodied in and relating to the original leased machines or the substituted leased machines so that Northwestern is thereby evicted from all or substantially all of the benefits of this General Agreement, then and in that case Northwestern may, at its option, revoke and terminate this General Agreement, in which event Northwestern shall thereupon restore to Hartford all of the original leased machines and said substituted leased machines and their appurtenances as provided in Section 21 hereof, and shall thereupon be relieved from paying further royalties, minimum or otherwise, thereafter accruing; PROVIDED, however, that until such revocation and restoration Northwestern shall continue to be bound by all the covenants and provisions of this General Agreement.
Section 18 Protection of Northwestern from Infringement Claims-Liability for Non-Performance.
(a) Hartford will, at its own expense, save and hold Northwestern harmless against damages and costs recovered in any suit or claims brought against North-western for alleged infringement of patents based on the use of the original leased machines or the substituted leased machines, but only to the extent of the royalties which shall have been paid by Northwestern during and for the period of infringement and before the judgment for such recovery said period not to exceed, however, the Twenty-four (24) months immediately preceding such judgment. Hartford, shall, upon written request of Northwestern, defend any such suits or claims unless or until Hartford shall elect to effect a settlement thereof. Northwestern shall promptly inform Hartford of any such suit or claim or any threat or probability thereof coming to the knowledge of Northwestern and shall, at Hartford's expense, fully and freely aid Hartford in defending the same, and shall further promptly inform Hartford of any infringement of Hartford's patents coming to the knowledge of Northwestern.
(b) Hartford shall have the right to intervene in and defend as a party thereto any suit brought against Northwestern during the term hereof which involves any contention that the making, selling or use of the original leased machines or the substituted leased machines or any improvement or part thereof constitutes an infringement of any patents.
(c) In case Hartford shall be delayed in the performance of or be rendered unable to perform all or any part of this General Agreement by reason of strikes, unavoidable accident, the non-arrival of machines or materials, or if the installation of said substituted leased machines or the operation of the said original leased machines or the substituted leased machines shall be delayed or stopped by the process or order of any court of competent jurisdiction, Hartford shall not be liable to Northwestern for any loss, delay or damage incurred thereby, except for damages recovered by infringement, asset forth and limited above in this Section; PROVIDED, however, that if the right of Northwestern to use any original leased machine or any substituted leased machine or any part thereof shall be suspended by reason of an order, decree or injunction issued by any court of competent jurisdiction then during the continuance of restraint by such order, decree or injunction or until Hartford shall have substituted other machinery or parts, as hereinafter set forth, which Hartford agrees to do as promptly as reasonably possible, the royalties applicable to each machine, the use of which is so suspended, shall be waived.
(d) In the event of such an order, decree or injunction being issued against any original leased machine or any substituted leased machine or any part or parts thereof Hartford reserves the right to substitute with reasonable promptness other machines or parts for those involved in that injunction, and at no cost or charge to Northwestern. The part or parts so substituted shall be of an efficiency substantially equal to that of the part or parts so involved in said order, decree or injunction , and shall immediately become subject to all the provisions of this General Agreement.
(e) In the event that such order, decree or injunction shall become permanent against any original leased machine or any substituted leased machine or any part or parts thereof and no substitution of machinery or parts shall have been made with reasonable promptness, as above stated, then in that event this General Agreement shall cease and terminate in all its provisions as to the particular leased machine or substituted leased machine against which such order, decree or injunction shall become permanent.
Section 19 Right of Revocation. Incase Northwestern shall violate, fail to observe or refuse to perform any of the conditions set forth in Sections 2, 4, 5, 8, 9, 10, 11, 12, 13, 14, 15, 22 and 23 of this General Agreement, or shall cause the same to be violated, Hartford shall have the right, at its option, to revoke and terminate absolutely this General Agreement, or any individual license and lease issued hereunder as to any original leased machine or any substituted leased machine, upon giving written notice to Northwestern of said revocation at least Thirty (30) days before the date when such revocation takes effect. Except as provided in Sections 17, 18, 20 and 23, no termination or revocation whatsoever of this General Agreement under any Section hereof nor the use of the remedy of injunction, accounting or re-possession shall, however, affect or in any way discharge the liability of Northwestern hereunder to pay and to continue to pay to Hartford the minimum royalty provided by Section 13 hereof for and during the entire term of this General Agreement, including its supplemental Eight (8) year period, if entered upon; nor shall any royalties paid by Northwestern be returned.
Section 20 Commutation of Minimum Royalties. It is further agreed that in the event of such revocation set forth in Section 19 Northwestern in lieu of said obligations therein provided to pay the said minimum royalties throughout said entire term may, at its option, wholly discharge said obligation by paying to Hartford within Sixty (60) days after said revocation takes effect, a lumpsum equal to Fifty per cent (50% ) of the total minimum royalties which would under this General Agreement be payable during the remainder of its term, including its said supplemental period, if entered upon, and provided further, that Northwestern may at any time during said term, including said supplemental period, revoke and terminate this General Agreement in its option by giving written no-tice to Hartford Sixty (60) days before-hand of its intention so to revoke and by paying to Hartford within said Sixty (60) days a lump sum in discharge calculated as above set forth in this Section.
Section 21 Re-Possession of Machinery. Upon the termination of this General Agreement, at the end of its initial or supplemental period, or sooner, as herein provided, Northwestern shall return to Hartford the original leased machines and the substituted leased machines and all appurtenances thereof covered by this General Agreement or any individual license and lease hereunder in good condition, reasonable wear excepted, by delivering the same properly crated and packed f . o . b. cars at any convenient freight station near the plant of Northwestern in which said leased machinery is located. If Northwestern shall fail so to deliver the machinery Hartford is hereby authorized to enter upon any premises where the original leased machines and the substituted leased machines may be and take possession thereof and remove them.
Section 22 Inspection. Duly authorized agents or employees of Hartford shall at all reasonable times be allowed access to the original leased machines or the substituted leased machines for the purpose of inspecting the same and its operation and use and Northwestern shall afford all reasonable facilities therefor.
Section 23 Fire Loss.
(a) In the event that the original leased machines or the substituted leased machines shall be damaged by fire so as to cause a suspension of production therewith Northwestern shall immediately give written notice to Hartford as to the extent and nature of the damage to the machines and as to the plans and intentions of Northwestern relative to repairing the damage and resuming operations under this General Agreement.
(b) In the event of such damage by fire, Hartford, if requested in said notice, shall, at its own expense, and to an extent not exceeding the amount of insurance received, provide Northwestern with the machinery or parts thereof necessary to repair or replace the damaged machinery or parts. Northwestern shall, at its own expense, promptly and diligently proceed to install the said machinery or parts thereof. From the time when said notice is received by Hartford and thereafter during only such time not exceeding Six (6) months as may be necessary for providing and installing the said machines or parts the minimum royalty set forth in Section 13 hereof as to the particular original leased machine or substituted leased machine damaged shall be waived.
(c) If Northwestern shall not, within Six (6) months after the occurrence of the fire, rebuild or otherwise repair the damage and resume operation under the General Agreement, or if Northwestern shall fail to resume the payment of royalties when due, then in any of these cases Hartford shall have the right, at its option, to revoke and cancel this General Agreement.
Section 24 Waiving of Conditions. None of the terms of this General Agreement shall be held to have been waived or altered unless such waiver or alteration is in writing, signed by an officer of Hartford expressly authorized thereto.
IN WITNESS WHEREOF the parties have hereunto set their hands and seals, acting herein by their respective officers duly authorized therefor.
HARTFORD-EMPIRE COMPANY,
By Roger M. Eldred,
General Manager.
Attest:
Arthur T. Safford, Jr.
Secretary.
NORTHWESTERN GLASS
COMPANY,
By Edward S. Campbell,
President.
Attest:
Joseph M. Gangler,
Secretary.
SCHEDULE A
Annexed to General Agreement between Hartford-Empire Company and Northwestern Glass Company, Dated August 1, 1933.
MACHINES COVERED BY AGREEMENT
1. The Two (2) O'Neill Feeders and the One (1) Meyer Feeder now located on the tank at the plant of Northwestern. To the two O'Neill Feeders, after the execution of this Agreement, will be attached Hartford-Empire Company number plates designating these feeders as Type No. 33 and Serial No. 15 and 16 respectively. To the Meyer Feeder likewise will be attached a plate designating this feeder as Type No. 43 and Serial No. 2.
2. The Hartford Single Feeder equipped with parts shown below adapted to cover range of ware specified elsewhere in this contract, Class 144:
Shear Cam Plunger Lever
Plunger Cam Spout Casing
Drop Guide Tube Clamp
Ring Holder Plunger Chuck
Tube Holder Shear Shanks
Orifice Support
Not including the following parts
Spout Arch Blocks
Orifice Ring Plunger
Tube Shear Blades
Spout Cover
One plain sub base.
One set metal parts forehearth front section.
One set clay parts for forehearth front section.
One interceptor mechanism.
One drive mechanism excepting motor, but including chains and sprockets adapted to cover range of ware specified elsewhere in this contract.
One machine synchronizer.
One set single feeder operating tools.
SCHEDULE B
Annexed to General Agreement between Hartford-Empire Company and Northwestern Glass Company, dated August 1, 1933.
INSTALLATION OF HARTFORD SINGLE FEEDERS
(1) Hartford will furnish free of charge to Northwestern such general supervision as Hartford may deem necessary in connection with the installation of the Hartford Single Feeders.
(2) Hartford will, if requested in writing a competent by Northwestern, furnish machinist to direct and assist in the said installation.
(3) Hartford will, if requested in writing by Northwestern, furnish a competent operator to instruct Northwestern's operators in the operation of the said machinery for a period not exceeding Two (2)weeks from the time the said machinery is installed.
(4) Northwestern will pay to Hartford the entire cost incurred by Hartford under (2) and of instructions under (3), including the traveling and living expenses of the men furnished, plus ten per cent (10%) of the entire cost.
SCHEDULE C
Annexed to General Agreement between Hartford-Empire Company and dated Northwestern Glass Company, August 1, 1933.
Specification of Glassware Which May Be Made.
PERMITTED WARE
The ware to be produced hereunder shall not be sold, shipped to or distributed in or to any place outside of the territory consisting of the States of Washington, and Montana and of Oregon, Idaho, Alaska, and such ware shall comprise only(except as expressly excluded below) the articles named under this heading of Permitted Ware and made of the compositions of glass now commonly used for such articles, whether flint, blue, amber or green (but excluding opal), and not exceeding One hundred twenty-eight (128) ounces in weight, said articles to be either blown or pressed and blown, except as provided in item 6 herein:
(1) Beers and wines.
(2) Flasks and liquor ware.
(3) Food and food condiments for the following purposes:
(a) Vinegar; (b) Cider; (c) Syrup; (d) Olive Oil; (e) Salad dressings, including mayonnaise; (f) Flavoring extracts and seasonings; (g) Relishes; (h) Olives; (i) Oysters and clams; (j) Preserves; (k) Pickles; (1) Peanut Butter; (m) Salmon Eggs; (n) Fruits; (o) Fish; (p) Honey; (q) Cheese; (r) Catsup;(s) Coffee; (t) Chicken; (u) Horse Radish.
(4) Beverage Bottles:
(a) Sodas; (b) Fruit Juices.
(5) Miscellaneous paste, vaseline, polishes, paint, shellac, ammonia, bluing, glue, ink and glass floats; Jars for machine parts.
(6) Bowls for moth bait, whether blown, pressed and blown, or purely pressed.
There are also specifically excluded, without however, being limited to the Exclusions mentioned below, all the articles included within the following list:
1. Bulbs and tubing and cane all when for use in the manufacture of incandescent electric lamps or for any other permanently sealed enclosure for electrical purposes
2. Signal and optical ware.
3. Ware intended and adapted for use where the heat resistance, physical strength, chemical resistance or electrical properties of such ware are of substantial value, provided such ware is made from glass having a linear coefficient of thermal expansion of less than .000006 per degree Centigrade, or containing more than five per cent boric oxide, or having an electric strength or thermal endurance or chemical resistance higher than a glass containing 80% silica; 10% sodium oxide; 5% boric oxide and 5% calcium oxide.
4. Ware intended and adapted for holding food in the process of cooking or sterilizing, other than ware intended and adapted for packages for storage and sale of goods or for transportation of goods.
5. Mold-blown articles of glass in so far as the same are or may be used for electrical purposes or in connection with electric illumination.
6. Ware which is pressed and not blown, except as provided in item 6 under Permitted Ware.
7. Tumblers; lantern globes; gas globes; chimneys; vault lights; battery jars and battery containers; fish globes; display jars; tablet jars; insulators and drawn tube and cane.
8. Fruit Jars for Domestic (Household) Use.
"Fruit jars for domestic (household) use," shall mean generally the term as used in the glass industry the intent being to include all kinds and sizes of the regular Mason jar with sealing shoulder with screw thread that fits regular Mason fruit jar caps; Lightning style fruit jars; and other sealing jars, intended to be shipped to the trade to be sold empty to the ultimate consumer, either with or without caps; but not to include jars manufactured for packers to be filled by them before selling to their trade.
9. Marbles and Lithographers balls.
10. Vacuum Bottles.
11. Milk Bottles and Nursing Bottles.
SETTLEMENT AGREEMENT
This Agreement made this 1st day of August, 1933, between Hartford-Empire Company, a corporation of Delaware having its principal place of business at Hartford, Connecticut, (hereinafter called "Hartford"), and Northwestern Glass Company, a corporation of Washington, having its principal place of business at Seattle, Washington, (hereinafter called "Northwestern"),
WITNESSETH
WHEREAS Hartford is engaged in the manufacture of glass-working machinery and in the licensing of machinery and methods for the manufacture of glassware, and further, owns many inventions, applications for letters patent and patents of the United States relating to the manufacture of glassware, and
WHEREAS Northwestern is engaged in the manufacture of glassware, and prior to the date hereof has used certain glass feeding machines which Hartford claims infringe certain patents of Hartford,
WHEREAS Northwestern desires to effect a settlement for its past infringing uses of Hartford's patents.
NOW, THEREFORE, in consideration of these premises and the covenants and payments hereinafter set forth, the parties agree as follows
Section 1 Payment of Damages.
(a) Northwestern hereby agrees to pay to Hartford the sum of Fifteen Hundred Dollars ($1,500), said sum to be paid in Three (3) installments of Five Hundred Dollars ($500) each the first of said installments being due upon the execution of this Settlement Agreement, the second of said installments being due October 1, 1933, and the third and last of said installments being due December 31, 1933. Northwestern will execute a note payable to Hartford for the sum of Fifteen Hundred Dollars ($1,500), payable in the amounts and at the times herein specified.
(b) In the event that Northwestern shall fail to pay any of its installments when the same shall become due Hartford shall be entitled to revoke the General Agreement between Hartford-Empire Company and Northwestern Glass Company of even date herewith, or any individual license and lease issued there under and to take possession of the machinery covered by said agreement or by any of said individual licenses and leases in the manner provided for in Sections 19 and 21thereof; PROVIDED, however, that this right of revocation and repossession shall in no way affect any other remedy Hartford may have for the collection of any of said installments.
Section 2 Release. Hartford hereby releases Northwestern from any and all claims and demands by Hartford in law or equity for profits and/or damages arising from infringement occurring prior to the date hereof of patents of Hartford in so far as said infringement consisted in the making, using or selling by Northwestern of Three (3) certain glass feeding machines, Two (2) being known as O'Neill Feeders and One (1) as a Meyer Feeder, said Feeders being more specifically described in Schedule A of the Agreement referred to above.
Section 3 Transfer of Feeder Inventions. Northwestern hereby sells, assigns and transfers to Hartford all its right, title and interest to and in any inventions, applications for letters patent of the United States and United States patents now owned or controlled by it and relating to the feeding of molten glass.
Furthermore, Northwestern, at the request of Hartford will execute such further documents as shall be necessary to vest title to such inventions, patent applications and patents in Hartford.
IN WITNESS WHEREOF the parties have hereunto set their hands and seals, acting herein by their respective officers duly authorized therefor.
HARTFORD-EMPIRE COMPANY
By Roger M. Eldred,
General Manager
Attest
Arthur T. Safford, Jr.
Secretary
NORTHWESTERN GLASS COMPANY
By Edward S. Campbell
President
Attest
Jos. M. Gangler
Secy.
BILL OF SALE
In consideration of the sum of One Dollar ($1.00) and other valuable considerations, receipt of which is hereby acknowledged, Northwestern Glass Company, a corporation of Washington having its principal place of business at Seattle, Washington, hereby agrees to sell, assign and transfer and does by these presents sell, assign and transfer to Hartford-Empire Company of Hartford, Connecticut, all right, title and interest to and in Three(3) certain glass feeders. Two (2) being known as O'Neill Feeders and One (1) as a Meyer Feeder now located in its plant at Seattle, Washigton [sic] Washington.
To said O'Neill Feeders, in accordance with an Agreement of even date herewith, shall be affixed Hartford-Empire Company number plates designating these feeders as Type No. 33, Serial No. 15 and 16, and likewise to said Meyer Feeder will be attached a plate designating this feeder as Type No. 43 and Serial No. 2.
IN WITNESS WHEREOF said Northwestern Glass Company, by its President duly authorized therefor, hereunto sets, itshand and seal this 1st day of August, 1933.
NORTHWESTERN GLASS COMPANY
By Edward S. Campbell
President
Attest
Jos. M. Gangler, Secy.
[Original of note sent to Northwestern 2/5/34]
Seattle, Washington
7/24, 1933
For value received, the Northwestern Glass Company promises to pay to Hartford-Empire Company, or order, at its place of business at 333 Homestead Avenue, Hartford, Connecticut, the sum of Fifteen Hundred Dollars ($1500), without interest. Said principal sum is to be paid in Three (3) installments of Five Hundred Dollars ($500) each the payment of the first of which shall be made upon the execution of a certain Settlement Agreement between Northwestern and Hartford, and the payment of the second installment to be made on the first day of October, 1933, and the payment of the third and last installment to be made on December 31, 1933.
It is expressly understood and agreed that on failure to pay any one of said installments when due the entire unpaid balance of said principal sum shall mature and become payable in full in Thirty (30) days from date such unpaid installment becomes due.
NORTHWESTERN GLASS COMPANY
By ___________________
President
In Presence Of
___________________
(Exhibit No. 120)
Received in Evidence, Dec. 12. Printed
in Verbatim Record. Page 207)
License and lease No. HSF-20, from
Hartford-Empire Company to
Laurens Glass Works, Inc., dated
June 9, 1924; renewed June 9, 1932.
LICENSE AND LEASE NO. HSF-20 made this ninth day of June, 1924, between the HARTFORD-EMPIRE COMPANY, a corporation organized under the laws of the State of Delaware, and having a place of business at Hartford, Connecticut, hereinafter designated as LICENSOR, and the Laurens Glass Works, Inc., a corporation organized under the laws of the State of South Carolina, and having a place of business at Laurens, South Carolina, hereinafter designated as LICENSEE,
WITNESSETH: That whereas the Licensor is the owner of certain Letters Patent of the United States and of certain applications now pending for Letters Patent of the United States, relating to the manufactures of glassware, and WHEREAS the Licensee is engaged in manufacturing glassware, having a plant for that purpose at Laurens, South Carolina, and desires to use machinery embodying inventions shown in said letters patent and patent applications in said business at said plant:
NOW, THEREFORE, in consideration of the covenants and royalties hereinafter set forth, and a license fee of Twenty-five hundred (2,500) Dollars to be paid by said Licensee to said Licensor in the following manner, Twelve hundred and fifty (1250) Dollars to be paid upon the execution and delivery of this license and lease, and the balance of Twelve hundred and fifty (1250) Dollars within sixty (60) days after the "Single Feeder" described in Schedule "A" annexed hereto, hereinafter termed the leased machinery, is ready for shipment to Licensee; and in consideration of the covenants of the parties hereinafter set forth, it is hereby mutually agreed as follows:
SECTION 1. EXTENT OF LICENSE
AND LEASE
(a) The Licensor hereby leases to the Licensee and hereby licenses the Licensee to use the said leased machinery. PROVIDED, HOWEVER, that this license and lease is limited (not absolute), and confers only the right to use said leased machinery in continental United States, and in the manner and for the purpose hereinafter set forth, and not otherwise.
(b) It is agreed between the parties hereto, that no obligation whatsoever rests upon or is assumed by the Licensor that other machinery and equipment of the Licensee or of others will operate successfully or efficiently in conjunction with the said leased machinery of the Licensor.
SECTION 2. PREPARATION FOR
INSTALLATION.
The Licensee agrees, upon receiving drawings and lists showing locations and dimensions of said leased machinery, to furnish and have ready proper floor space, foundations, connection between tank and forehearth, piping, shafting, tools, motor, power and such other adjuncts and equipment as are required, to the complete satisfaction of the Licensor.
SECTION 3. DELIVERY AND
INSTALLATION
(a) The Licensor, as soon as reasonably possible after the provisions of Section 2have been complied with, shall deliver said leased machinery f. o. b. at place of manufacture, and shall install said leased machinery as provided in Schedule "B" annexed hereto.(b) The Licensee agrees to proceed diligently with the installation of said leased machinery as soon as the same is delivered, and to accept the machinery and pay royalties to the Licensor as called for by Sections 10 and 11 of this license and lease.
SECTION 4. TERM
The term of this license and lease, unless sooner revoked or terminated as pro-vided elsewhere herein, shall be for an initial period of Eight (8) years from the date of this license and lease, with privilege, if claimed by the Licensee inwriting before the expiration of the said initial period, of one renewal for a supplemental period of Eight (8) years, upon all the conditions hereof, except as to installation and further renewal, and without additional license fee for such renewal.
SECTION 5. LICENSOR RETAINS
TITLE
It is understood and agreed that the Licensor and its successors and assigns, retains, and at its own option, shall continue to retain throughout the term of this license and lease, complete title to said leased machinery.
SECTION 6. PLACE AND NATURE
OF USE.
(a) Said leased machinery and all improvements thereon shall be used only for manufacturing the glassware defined in Schedule "C" annexed hereto, and only at said plant of Licensee located at Laurens, South Carolina, or at any other plant owned by the Licensee.
(b) Said leased machinery and all improvements thereon shall be used for delivering glass to only one forming machine, and not otherwise.
SECTION 7. PROHIBITION OF
ASSIGNMENT.
The said leased machinery shall be used only by the Licensee or its operatives, and only at the plant or plants aforesaid. Neither the said leased machinery nor this license and lease shall be transferred. assigned or sub-let by the Licensee, except to the purchaser of the entire business of the Licensee. If either be otherwise transferred, assigned or sub-let, or if the Licensee discontinues for a period of more than one year the production of glassware under this license and lease, or becomes bankrupt, or a receiver is appointed over it, or if the Licensee makes any general transfer or assignment for the benefit of creditors, then and in any such case this license and lease may, at the option of the Licensor, be terminated.
SECTION 8. CHANGES, ADDITIONS
AND IMPROVEMENTS
(a) No changes and no additions other than reasonable and necessary repairs and other than necessary or proper safety appliances, shall be made in or to said leased machinery except by consent of both parties to this license and lease, or except as provided in Section 16 hereof for the event of injunction, and except as provided in this Section for improvements; and all changes and additions when made, shall become the property of the Licensor. Complete title to all patent rights at any time possessed during the term of this license and lease by the Licensee covering such changes and additions shall be transferred to the Licensor.
(b) The Licensee shall, during the term of this license and lease, be given the benefit, for the purposes set forth in Section 6, of any and all improvements for use in and upon said leased machinery, which may be devised, developed or acquired by the Licensor, if and when said improvements shall with the express consent of the Licensor, have been used commercially in the United States upon said leased machinery in the making of glassware. In such event the Licensor will, upon written request of the Licensee, furnish to the Licensee with reasonable promptness, such parts as may be needed to apply the said improvements to the said leased machinery and at prices similar to those charged by Licensor for such parts to other similar licensees. Such improvements shall be used by the Licensee only in or upon the said leased machinery, and only during the term of this license and lease. All parts displaced from said leased machinery by the said improvements shall be returned to the Licensor.
The word "improvement" when used in this license and lease, shall be held to mean only (1) substitution of new parts for old parts of said leased machinery; or (2) changing old parts thereof; or (3) addition of new devices which are intended and adapted to become integral portions of such machinery; and not otherwise.
SECTION 9. ACCOUNTING.
(a) The Licensee shall keep proper books of account during its entire operation under this license and lease, showing the length of time that said leased machinery is operated each day, and the number, kinds and sizes of glassware produced each day by said machinery, and all other facts necessary or advantageous for carrying out the purpose of this license and lease, together with a semi-annual statement showing the detailed cost of such production for the preceding six months, all in such form, within reasonable limits, as shall be specified by the Licensor.
(b) Such books shall at all reasonable times be open to the inspection of the Licensor, or its duly authorized agents. The Licensee shall, on or before the fifteenth day of each month, furnish to the Licensor upon blanks provided by the latter, properly certified detailed statements giving in itemized form all the data mentioned in this Section, so far as may be required by the Licensor, for the preceding calendar month, except as to said costs of production, which shall be reported semi-annually, as above provided.
SECTION 10. ROYALTIES.
(a) The Licensee shall pay to the Licensor during the term of this license and lease, royalties on all merchantable glassware produced by or with the aid of said leased machinery from the completion of its installation, at rates per gross, for the respective items of ware, as provided in Schedule "D" annexed hereto.
(b) All of said royalties shall be paid monthly, at the Licensor's office, in New York funds, on or before the fifteenth day of each month, for and upon all glassware manufactured by the Licensee under this license and lease, during the preceding calendar month.
SECTION 11. MINIMUM ROYALTY.
The said Licensee shall pay in royalties, a minimum royalty under this license and lease of not less than fifteen Hundred (1,500) Dollars per year, to commence ninety (90) days after said leased machinery is ready to ship to Licensee, and to be payable in New York funds, on or before the fifteenth day of January, for the year last preceding, during the entire term of this license and lease, including the said supplemental period, if entered upon, of Eight (8) years, subject to the provisions of Section 18. The first payment hereunder shall be prorated according to the number of months during which such minimum royalty shall have actually been accruing in the first calendar year.
SECTION 12. INSURANCE.
The Licensee shall also at its own expense, procure and place in the hands of the Licensor good policies of insurance against fire to the amount of the full insurable value of said leased machinery; payable in case of loss to the Licensor; shall also pay all taxes assessed against said leased machinery, and shall hold any save the Licensor harmless against any and all damages and costs resulting from injury occurring to any of the said Licensee's employees or others on account of or in connection with said leased machinery, subsequent to the installation thereof.
SECTION 13. OPERATION OF
MACHINERY.
The Licensee shall keep, use and operate said leased machinery and all parts thereof in a careful, safe, prudent, and proper manner; shall maintain the same in good order, damage by fire excepted as hereinafter set forth; shall not, without consent of the Licensor, add to or subtract from such leased machinery as supplied by the Licensor, excepting necessary or proper safety appliances, or allow changes to be made therein, or interfere with the proper operation thereof, or remove or de-face any plates, dates, numbers or inscriptions placed thereon by the Licensor. The Licensee shall promptly notify the Licensor of the need of any repairs or renewals of said leased machinery, and the Licensee shall at its own expense effect such repairs and renewals, purchasing the necessary renewal parts from the Licensor. The Licensor agrees to furnish promptly such renewal parts at prices not in excess of the prices charged by responsible outside parties for parts of similar design, material and workmanship. If the Licensor declines or neglect so to furnish such parts, the Licensee may procure them elsewhere, but they shall not be installed on such machinery until they have been inspected and approved by a representative of the Licensor. The Licensee shall pay for the time and expenses of such representative.
SECTION 14. INHERENT DEFECTS.
The Licensor shall remedy and makegood without charge, any inherent defects appearing in the materials of said leased machinery, during one year from date of installation.
SECTION 15. ACKNOWLEDGING
VALIDITY OF PATENTS.
(a) Licensee hereby acknowledges the validity of any and all patents that maybe issued upon the said patent applications of the Licensor and of any and all other patents now or during the term of this license and lease, owned, controlled or leased by the Licensor, covering or relating to the said leased machinery, or to the methods or processes performed by the said leased machinery, and waives all rights to justify any breach of this license and lease on the Licensee's part by denying the validity of such patents, or any of them, excepting as to the claim or claims of said patent or patents which may be final decree of a court of competent jurisdiction, within the judicial circuit wherein said plant is located, including appellate courts if appeal is taken, have been declared void, this exception being limited to the particular claim or claims thus declared void.
(b) In case such final decree shall declare to be void all or substantially all of the Licensor's patents embodied in and relating to the said machinery, so that the Licensee is thereby evicted from all or substantially all of the benefits of this license and lease, then and in that case the Licensee may at its option revoke and terminate this license and lease, in which event the Licensee shall thereupon restore to the Licensor all of the said leased machinery and its appurtenances as provided in Section 19 hereof, and shall be thereupon relieved from paying further minimum royalties. PROVIDED, however, that until such revocation and restoration the Licensee shall continue to be bound by all the covenants and provisions of this license and lease.
SECTION 16. PROTECTION OF
LICENSEE FROM INFRINGEMENT
CLAIMS
(a) The Licensor will at its own expense save and hold the Licensee harmless against damages and costs recovered in any suits or claims brought against the Licensee for alleged infringement of patents based on the use of the said leased machinery, but only to the extent of the royalties which shall have been paid by the Licensee during and for the period of infringement and before the judgment for such recovery, said period not to exceed, however, the twenty-four months immediately preceding such judgment. The Licensor shall, upon the written request of the Licensee, defend any such suits or claims, unless or until the Licensor shall elect to effect a settlement thereof. The Licensee shall promptly inform the Licensor of any such suit or claim, or any threat or probability thereof, coming to the knowledge of the Licensee, and shall, at the Licensor's expense, fully and freely aid the Licensor in defending the same; and shall further promptly in-form the Licensor of any infringement of the Licensor's patents coming to the knowledge of the Licensee.
(b) The Licensor shall have the right to intervene in and defend, as a party thereto, any suit brought against the Licensee during the term hereof which involves or in any way affects the validity of any patent embodied in said leased machinery or in any improvement thereof furnished by the Licensor.
(c) In case the Licensor shall be delayed in the performance of, or be rendered unable to perform all or any part of this license and lease, by reason of strikes, unavoidable accident, the non-arrival of machines or materials, or if the installation or operation of the said leased machinery shall be delayed or stopped by the process or order of any court of competent jurisdiction, the Licensor shall not be liable to the Licensee for any loss, delay or damage incurred thereby, except for damages recovered for infringement as set forth and limited above in this Section, PROVIDED, however, that if the right of the Licensee to use the said leased machinery, or any part thereof, shall be suspended by reason of an order, decree or injunction issued by any court of competent jurisdiction, then during the continuance of restraint by such order, decree or injunction, or until the Licensor shall have substituted other machinery or parts as hereinafter set forth, which said Licensor agrees to do as promptly as reason-ably possible, the minimum royalty as set forth in Section 11 hereof shall be waived.
(d) In the event of such an order, decree or injunction being issued against any part or parts of said leased machinery, the Licensor reserves the right to substitute with reasonable promptness other machinery or parts for those involved in the injunction and at no cost or charge to the Licensee excepting any license fee or royalty which the Licensor may have to pay for the right to make, and license the Licensee to use, such other machinery or parts. The part or parts so substituted shall be of an efficiency substantially equal to that of the part or parts so involved in said order, decree or injunction and shall immediately become subject to all the provisions of this license and lease.
(e) In the event that such order, decree or injunction shall become permanent against any part or parts of said leased machinery, and no substitution of machinery or parts shall have been made with reasonable promptness as above stated, then in that event this license and lease shall cease and terminate in all its provisions, and if the said event occurs during the first Three (3) years of the term of this license and lease, the Licensee shall be entitled to receive back the said license fee of Twenty-five hundred (2,500) Dollars paid by it, after deducting therefrom such proportion thereof as the elapsed time under this license and lease shall bear to the said Three years.
SECTION 17. RIGHT OF REVOCATION
(a) In case the Licensee shall violate or fail to observe any of the conditions set forth in Sections 1, 3, 6, 7, 8, 9, 10, 11, 12, 13, 20 and 21 of this license and lease, or shall cause the same to be violated, the Licensor shall have the right at its option, to revoke and terminate absolutely, this license and lease upon giving written notice to the Licensee of said revocation at least thirty (30) days before the time when such revocation is to take effect.
(b) Except as provided in Sections 15, 16, 18 and 21, no termination or revocation whatsoever of this license and lease under any Section hereof, nor the use of the remedy of injunction, accounting or re-possession shall, however, affect or in any way discharge the liability of the Licensee hereunder, to pay and to continue to pay to the Licensor, the minimum royalty provided by Section 11 hereof, for and during the entire term of this license and lease, including its supplemental eight year period if entered upon, nor shall any royalty paid by said Licensee be returned.
SECTION 18. COMMUTATION OF
MINIMUM ROYALTIES
It is further agreed that in the event of such revocation set forth in Section 17,the Licensee, in lieu of said obligation therein provided to pay the said minimum royalties throughout said entire term, may at its option wholly discharge said obligation by paying to the Licensor within sixty days after said revocation, a lump sum equal to fifty (50) per cent of the total minimum royalties which would under the license and lease be payable during the remainder of said term, including its said supplemental period if entered upon ;and provided further, that the Licensee may at any time during said term, including said supplemental period, revoke and terminate this license and lease in its option, by giving written notice to the Licensor sixty (60) days beforehand of its intention so to revoke and by paying to the Licensor within said sixty days a lumpsum in discharge calculated as above set forth in this Section.
SECTION 19. RE-POSSESSION OF
THE MACHINERY.
Upon the termination of this license and lease at the end of its initial or supplemental period, or sooner at herein provided, the Licensee shall return to the Licensor the said leased machinery and all appurtenances thereof, as covered by this license and lease, in good condition, reasonable wear and use excepted, by delivering the same properly crated and packed f. o. b. cars at any convenient freight station near the plant of the Licensee. If said Licensee shall fail so to deliver the machinery, the Licensor is hereby authorized to enter upon any premises where the said leased machinery may be and take possession thereof and remove it.
SECTION 20. INSPECTION
Duly authorized agents or employees of the Licensor shall at all reasonable times be allowed access to the said leased machinery for the purpose of inspecting the same and its operation and use, and the Licensee shall afford all reasonable facilities therefor.
SECTION 21. FIRE LOSS
(a) In the event that the said leased machinery shall be damaged by fire so as to cause a suspension of production there-with the Licensee shall immediately give written notice to the Licensor as to the extent and nature of of the damage to the said leased machinery, and as to the plans and intentions of the Licensee relative to repairing the damage and resuming operations under this license and lease.
(b) In the event of such damage by fire the Licensor, if so requested in the said notice, shall at its own expense and to an extent not exceeding the amount of insurance received, provide the Licensee with the machinery or parts thereof necessary to repair or replace the damaged machinery or parts. The Licensee shall at its own expense promptly and diligently proceed to install the said machinery or parts thereof. From the time when said notice is received by the Licensor and thereafter during only such time, not exceeding six months as may be necessary for providing and installing the said machinery or parts, the minimum royalty set forth in Section 11 hereof shall be waived.
(c) If the Licensee shall not within six (6) months after the occurrence of the fire rebuild or otherwise repair the damage and resume operation under this license and lease; or if the Licensee shall fail to resume the payment of royalties when due, then in any of these cases the Licensor shall have the right at its option to revoke and cancel this license and lease.
SECTION 22. BUREAU OF STATISTICS
If the Licensor shall undertake to establish and conduct a bureau for the collection, preservation and use of data relating to the operations and purposes of its licenses and leases, then in that case the expense of maintaining such a bureau shall be defrayed by proportionate assessments to be made by the Licensor monthly upon its Licensees. The proportion to be assessed upon the Licensee shall be the same as the proportion which the number of such licenses and leases held by this Licensee at the time of making such assessments shall bear to the total number of similar licenses and leases then held by all the Licensees of the Licensor in the United States. This Licensee hereby agrees to pay the amount so assessed upon it for each month within fifteen days from the date of receiving statements therefor from the Licensor.
SECTION 23. WAIVING THE
CONDITIONS.
None of the terms of this license and lease shall be held to have been waived or altered unless such waiver or alteration is in writing, signed by an officer of the Licensor, expressly authorized thereto.
SCHEDULE A.
Annexed to License and Lease No. HSF-20, Dated June 9, 1924, between Hartford-Empire Company and Laurens Glass Works, Inc., of Laurens, S. C.
LIST OF MACHINERY AND ACCESSORIES FURNISHED. SINGLE FEEDER NO. 38
1 Hartford Single Feeder equipped with parts shown below adapted to cover range of ware specified elsewhere in this contract, (Class 144) Shear Cam, Plunger Cam, Drop Guide, Ring Holder, Tube Holder, Orifice Support, Plunger Lever, Spout Casing, Tube Clamp, Needle Chuck, Shear Shanks.
Not including the following parts: Spout, Orifice Ring, Tube, Spout Cover, Arch Blocks, Needle, Shear Blades.
1 Plain Sub-Base-Class 144.
1 Set Metal Parts for Forehearth Class144.
1 Set Clay Parts for Forehearth Class144.
1 Interceptor Mechanism Class 144.
1 Drive Mechanism excepting Motor, but including Chains and Sprockets adapted to cover range of ware specified elsewhere in this contract Class 144.
1 Machine Synchronizer Class 144.
1 Set Single Feeder Operating Tools Class 144.
SCHEDULE B
Installation of Machinery:
1. The Licensor will furnish free of charge to the Licensee such general supervision as the Licensor may deem necessary in connection with the installation of the leased machinery set forth in Schedule "A" annexed hereto.
2. The Licensor will, if requested in writing by the Licensee, furnish a competent machinist to direct and assist in the said installation.
3. The Licensor will, if requested in writing by the Licensee, furnish a competent operator to instruct the Licensee's operators in the operation of the said machinery for a period not exceeding two weeks from the time the said machinery is installed.
4. The Licensee will pay to the Licensor the entire cost of installation under (2) and of instructions under (3), including the traveling and living expenses of the men furnished, plus 10% of the said entire cost.
SCHEDULE C.
Specification of glassware which maybe made.
PERMITTED WARE.
The ware to be produced hereunder shall comprise (except as expressly excluded below under "Exclusions") all the articles named under this heading of Permitted Ware and made of the compositions of glass now commonly used for such articles, whether white, blue, amber or green, and not exceeding thirty (30) ounces in weight.
Blown bottles, in so far as the same are included within the classes of glassware now commonly known in the glass industry as Pressure Ware for (a) artificially carbonated drinks, such as sodas, ginger ales, mineral waters and other soft drinks; (b) malt beverages, such as Bevo, Pablo and other beer substitutes; (c) uncharged waters, such as Poland, Pluto and similar waters.
Laurens Glass Works, Inc., by (signed) Albert Dial, Pres. Mgr.; Hartford-Empire Company by (signed) F. Goodwin Smith, 1st Vice Pres.
EXCLUSIONS
The following articles are expressly excluded and shall not be produced under this license:
(a) Bulbs and tubing and cane all when for use in the manufacture of in candescent electric lamps or for any other permanently sealed enclosure for electrical purposes.
(b) Signal and optical ware.
(c) Ware intended and adapted for use where the heat resistance, chemical resistance or electrical properties of such ware are of substantial values, provided such ware is made from glass having a linear coefficient thermal expansion of less than .000006 per degree Centigrade, or containing more than five per cent boric oxide, or having an electric strength or thermal endurance or chemical resistance higher than a glass containing 80% silica; 10% sodium oxide; 5% boric oxide and 5% calcium oxide.
(d) Ware intended and adapted for holding food in the process of cooking or sterilizing, other than ware intended and adapted for packages for storage and sale of goods or for transportation of goods.
(e) Mold-blown articles of glass in so far as the same are or may be used for electrical purposes or in connection with electric illumination.
(f) Ware which is pressed and not blown.
(g) Milk bottles and nursing bottles.
(h) Tumblers; fruit jars; lantern globes; gas globes; chimneys; vault lights; battery jars and battery containers; fish globes; display jars; tablet jars; insulators and drawn tube and cane.
SCHEDULE D
Annexed to License and Lease No. H. S.F.-20, dated June 9, 1924, between Hart-ford-Empire Company and Laurens Glass Works, Inc., of Laurens, S. C.
RATES OF ROYALTY
November 24, 1924.
Laurens Glass Works, Inc.
Laurens, S. C.
Gentlemen: I thank you for your letter of the 22nd and in reply let me say that we hereby grant to you an extension of the field of ware specified in your licenses from us, HSF-20 and HSF-21 as follows:
You are authorized to make under the said licenses a total of not over 4000 gross per calendar year under both of said licenses, of panel bottles not exceeding 14 ounces in weight. The said bottles are to be sold chiefly to the Globe Medicine Company or to the Standard Drug Company, or both, both of Spartansburg, S. C. But you are also authorized, until further notice, to sell a part of such total of 4000 gross per year to small users of such bottles in your vicinity.
I trust this will be satisfactory to you.
Sincerely yours,
_______________
General Counsel.
HKS-GP
August 22, 1929
Laurens Glass Works, Inc.,
Laurens, South Carolina.
Gentlemen:
This letter, upon your acceptance below, constitutes a formal confirmation of the agreement reached by Mr. Easterby and Mr. Eldred in regard to additional fields of ware for Laurens.
It is now agreed that Hartford Single Feeder Licenses and Leases No. HSF-20, HSF-21, HSF-65, and HSF-99 between Hartford-Empire Company and the Laurens Glass Works, Inc., are amended in such a fashion as to include the following ware within Schedule C "Specification of Glassware Which May Be Made" of all the above-mentioned licenses.
1. Flasks and Liquor Bottles.
2. Blown Jars for (a) Mayonnaise (b) Shrimps (c) Salad Dressings (d) Pickles.
Very truly yours,
HARTFORD-EMPIRE COMPANY By F. Goodwin Smith, Pres't.
August 22, 1929. The foregoing amendment is hereby accepted and agreed to. LAURENS GLASS WORKS, INC. By C.D. Easterby, Pres.
March 1, 1933
Mr. E. D. Easterby, President
Laurens Glass Works
Laurens, South Carolina
Dear Mr. Easterby:
Mr. Pease advised you on February 24th of our willingness to broaden your Field of Ware in certain respects. The various kinds of ware which you are permitted to make appear to be scattered through numerous papers so we consider it advisable to incorporate your entire Permitted Ware into one paper.
Therefore, will you note your concurrence in the form provided below on both copies of this letter and return one of them to me for our files?
Hartford-Empire Company and Laurens Glass Works hereby agree that Schedule C of Licenses and Leases Nos.
HSF-20 dated June 9, 1924
HSF-21 dated June 9, 1924
HSF-65 dated August 10, 1925
HSF-99 dated July 12, 1926
are hereby amended with respect to Schedule C thereof so that said Schedule C shall now read as follows Specification of glassware which maybe made.
PERMITTED WARE
The ware to be produced hereunder shall comprise (except as expressly excluded below under "Exclusions") all the articles named under this heading of Permitted Ware and made of the compositions of glass now commonly used for such articles, whether white, blue, amber or green, and not exceeding Seventy-two (72) ounces in weight.
1. Blown jars in so far as the same are included within the classes of glassware now commonly known in the glass industry as Pressure Ware for
(a) Artificially carbonated drinks, such as sodas, ginger ales, mineral waters and other soft drinks
(b) Malt beverages, such as beer and beer substitutes
(c) Uncharged waters, such as Poland, Pluto and similar waters.
2. Panel Bottles; Provided that a total of not over Four Thousand (4,000) gross of such Panel Bottles (not exceeding Fourteen (14) ounces in weight) shall be produced in any one calendar year upon all feeders licensed by Licensor to Licensee, and that such bottles shall be sold chiefly to the Globe Medicine Company or to the Standard Drug Company, or both, of Spartansburg, South Carolina.
3. Flasks and Liquor Bottles.
4. Blown jars for mayonnaise, shrimps; salad dressings; pickles and peanut butter.
5. Bottles for vinegars; ciders and syrups; Provided, however, that the Licensee shall not produce an aggregate of over Ten Thousand (10,000) gross of such bottles in any one calendar year under all licenses and leases outstanding between it and the Licensor.
Very truly yours,
HARTFORD-EMPIRE COMPANY
A. T. Safford , Jr., Secretary.
Laurens, S. C., March 11th, 1933.
Laurens Glass Works hereby concurs in and agrees to the foregoing amendment.
LAURENS GLASS WORKS, (Signed) E. S. Easterby, President.
ATS:RLB
Laurens Glass Works,
Laurens,
South Carolina.
Attention Mr. E. D. Easterby
Gentlemen:
This letter, upon your acceptance, will formally amend your Licenses and Leases by the addition of Shoo Fly Flasks to your Field of Ware in accordance with the letter of Mr. Pease dated October 24, 1933.
Therefore, would you please note your concurrence in the form provided below on both copies of this letter and return one of them to us for our files?
It is hereby agreed between Hartford-Empire Company and Laurens Glass Company that Licenses and Leases Nos. HSF-20, HSF-21, HSF-65 and HSF-99 (all amended March 1st, 1933) shall each be amended in respect to Schedule C Specification of Glassware Which May Be Made by the addition thereto of the following:"
6. Blown Shoo Fly Flasks for Castor Oil and Turpentine, not exceeding Four (4) ounces in capacity."
Very truly yours,
HARTFORD-EMPIRE COMPANY,
JRH:RLB A. T. Safford, Jr.
Laurens, S. C., November 1st, 1933,
Laurens Glass Works hereby concurs in and agrees to the foregoing amendment.
LAURENS GLASS WORKS, By (Signed) W. D. Easterby, President.
March 2, 1934.
Laurens Glass Works, Laurens, S. C.
Attention Mr. E. D. Easterby
Gentlemen:
Upon recent consideration of the requirement in your Licenses and Leases for the payment of minimum royalties, it was decided that it might be of advantage to you to permit a "spread" of royalties on your feeders.
This would relieve you of the obligation to pay any minimum royalties in any year in which the production royalties equal or exceed the minimum royalties on all your feeders.
It, therefore, is hereby agreed between Hartford-Empire Company and Laurens Glass Works that the minimum royalties provided for in Section 11 of Licenses and Leases Nos.
HSF-20 dated June 9, 1924
HSF-21 dated June 9, 1924
HSF-65 dated August 10, 1925
HSF-99 dated July 12, 1926
and in any subsequent License and Lease covering a feeder, shall be payable only in the amount in which the production royalties payable under Section 10 of said Licenses and Leases for any one year on all feeders, are less than the total of the minimum royalties for such feeders specified in Section 11 of said Licenses and Leases.
This agreement shall be effective as of January 1, 1934.
Would you be good enough to sign both copies of this letter and return one of them to us for our files?
Very truly yours,
HARTFORD-EMPIRE COMPANY,
A. T. Safford , Jr., Secretary.
Laursens [sic] Laurens, S. C., March 7, 1934.
Laurens Glass Works concurs in and accepts the foregoing.
LAURENS GLASS WORKS, By (Signed) E. D. Easterby, President.
May 7, 1936.
Laurens Glass Works, Inc.,
Laurens, South Carolina.
Attention : E. D. Easterby, President
Gentlemen: We have decided to make an adjustment of our standard Feeder Royalty Rates for Blown and Pressed and Blown glassware in weights of One and One-half (12) Ounces or less as shown in the Schedule of your Feeder Royalties attached to both copies hereof.
It is understood that all other royalty rates now in force remain unchanged.
This adjustment is to become effective May 1, 1936, but will not go into effect until you sign this letter as requested below to show your acceptance of the adjustment and the conditions upon which it is made.
The same adjustment subject to the same conditions is being offered to all Licensees.
Therefore, please sign both copies of this letter, returning one copy to us for our files. This will then serve to amend your Feeder Royalty Rates to agree with the attached Schedule.
Very truly yours,
HARTFORD-EMPIRE COMPANY,
By (S) Arthur T. Safford, Jr., Secretary.
Laurens, S. C., May 9, 1936 Laurens Glass Works, Inc., hereby accepts the foregoing amendment subject to all the conditions thereof. LAURENS GLASS WORKS, INC., By (S) E. D. Easterby, President.
Schedule of Feeder Royalties attached to letter to Laurens Glass Works, Inc., dated May 27, 1936.
Rates of Royalty
The weights below specified are the weights of the finished articles Blown or Pressed and Blown:
(Exhibit No. 121)
(Received in evidence Dec. 12, page 208)
The contract between the Hartford-Empire Company and the Whitall Tatum Company of Millville, New Jersey, covering royalties.
January 21, 1935.
Whitall Tatum Company,
Millville, New Jersey.
Attention Mr. George S. Bacon
Gentlemen:
To carry out the changes in lehr royalties which Mr. Pease mentioned in his letter to you of January 10th, an amendment to your General Lehr Agreement dated September 19, 1933 is necessary.
For this purpose this letter will be sufficient, and we should be obliged if you would note your concurrence in the form provided below and return one copy of this letter (of which two are enclosed) to us for our files.
Therefore, Hartford-Empire Company and Whitall Tatum Company hereby agree, in consideration of the mutual ad-vantages accruing to each, that the General Lehr Agreement of September 19,1933 shall be amended, effective as of January 1, 1935, by rewriting Section 9 thereof to read as follows
"SECTION 9"
Royalties Minimum Royalty-Reports"
(a) Whitall Tatum shall pay to Hartford during the term of this General Lehr Agreement a royalty of Two and One-half Dollars ($2.50) per machine for each day, or any part thereof, during which each of said leased machines is used. Such royalty shall be paid monthly at Hartford's office in New York funds on or before the fifteenth day of each month for the use of said leased machines during the preceding calendar month.
"(b) Whitall Tatum shall pay a minimum royalty under this General Lehr agreement of not less than Four Hundred Dollars ($400) per year on each machine, payable in New York funds at Hartford's office on or before the fifteenth day of January for the year last preceding during the entire term of this General Lehr Agreement.
"PROVIDED that in the event Whitall Tatum shall pay in any one year under paragraph (a) of this Section 9 royalties in the sum equal to or exceeding Four Hundred Dollars ($400), multiplied by the number of machines under license for that year, no royalties shall be payable under this paragraph (b) for that year.
"(c) Whitall Tatum shall, on or before the tenth day of each month, furnish to Hartford, upon blanks provided by the latter, a properly certified statement showing the number of days that the leased machines are operated during the preceding calendar month."
Very truly yours,
HARTFORD-EMPIRE COMPANY
JRH:RLB A. T. Safford, Jr.
Secretary
Millville, New Jersey
Jan. 26, 1935
Whitall Tatum Company hereby concurs in and agrees to the foregoing amendment.
WHITALL TATUM COMPANY
By George S. Bacon
Vice-President
GENERAL LEHR AGREEMENT
Between
HARTFORD-EMPIRE COMPANY
And
WHITALL TATUM COMPANY
THIS AGREEMENT made this 19th day of September, 1933, by and between Hartford-Empire Company, a corporation organized under the laws of the State of Delaware and having its principal place of business at Hartford, Connecticut,(hereinafter called "Hartford"), and Whitall Tatum Company, a corporation organized under the laws of the State of New Jersey and having its principal place of business at Millville, New Jersey, (hereinafter called "Whitall Tatum"),
WHEREAS the parties hereto entered into a certain Supplemental Lehr Agreement dated October 1, 1925, which provided for the licensing of lehrs by Hartford to Whitall Tatum,
WHEREAS pursuant to said Agreement cetrain [sic] certain lehrs have been licensed by Hartford to Whitall Tatum under certain Licenses and Leases.
WHEREAS the parties have entered into a certain general Feeder Agreement of even date herewith providing for the licensing of Hartford Single Feeders to Whitall Tatum, and
WHEREAS the parties wish to cancel said supplemental Lehr Agreement and said Licenses and Leases and to enter anew agreement with respect to the Licensing and leasing of said lehrs,
NOW, THEREFORE, in consideration of these premises and the covenants and royalties hereinafter set forth, the parties agree as follows
Section 1 Cancellation of Outstanding Agreement and Licenses
(a) The Supplemental Lehr Agreement between Whitall Tatum and Hartford-Empire Company dated October 1, 1925, is hereby cancelled.
(b) The following Licenses and Leases, dated as below, and covering Hartford Lehrs as specified , are hereby cancelled
SECTION 2 FORM OF LICENSE AND
LEASE.
The Hartford Lehrs referred to in Section 1 above, to-wit Nos. 32, 82, 83, 110, 111, 114, 115, 157, 142, 166, 180, 184, 185,186, 199, 200, 233, 234, 232, 239, 249, and further described in Schedule A annexed hereto, (hereinafter called "leased machines") are hereby agreed to be from the date hereof and are hereby leased and the use thereof licensed under this present General Lehr Agreement by Hartford to Whitall Tatum, and shall here-after be entirely subject to the terms of this General Lehr Agreement, and shall no longer be subject to the agreements or licenses and leases above named in Section 1.
The leasing and licensing of all the lehrs above designated shall be further evidenced for each of said leased machines by the issuance by Hartford to Whitall Tatum of an individual license and lease in substantially the following form
WHITALL TATUM COMPANY
Lehr License and Lease No.
This License and Lease No. , made this day of 1933, between Hartford-Empire Company, a corporation organized under the laws of the State of Delaware and having its principal place of business at Hartford, Connecticut, (hereinafter called "Licensor") , and Whitall Tatum Company, a corporation organized under the laws of the State of New Jersey and having its principal place of business at Millville, New Jersey, (hereinafter called "Licensee"), in consideration of the mutual convenants herein set forth and referred to,
WITNESSETH
That the Licensor hereby leases to the Licensee and licenses the Licensee to use a certain glass annealing device or lehr described as follows
(Insert description and number of lehr)
This said License and Lease is made in pursuance of and with express reference to a certain General Lehr Agreement between the Licensor and Licensee dated .
It is agreed between the parties hereto that the said lehr shall be taken, held, licensed, leased, used, operated and returned subject to all the provisions of said General Lehr Agreement, in so far as such provisions are by such Agreement made applicable to said lehr and such provisions are expressly made a part of this License and Lease.
HARTFORD-EMPIRE COMPANY,
By Roger M. Eldred,
General Manager.
WHITALL TATUM COMPANY,
By G. C. Tatum,
President.
In Presence of
A. T. Safford , Jr.
H. V. Brumley
M. S. Osborn.
SECTION 3 EXTENT OF
AGREEMENT.
(a) Hartford hereby leases to Whitall Tatum and hereby licenses Whitall Tatum to use the said leased machines; PROVIDED, HOWEVER, that this General Lehr Agreement is limited (not absolute), and confers only the right to use said leased machines in continental United States, and in the manner and for the purpose hereinafter set forth, and not otherwise.
(b) It is agreed between the parties hereto that no obligation whatsoever rests upon or is assumed by Hartford that other machines and equipment of Whitall Tatum or of others will operate successfully or efficiently in conjunction with the said leased machines of Hartford.
SECTION 4 TERM.
The term of this General Lehr Agreement, unless sooner revoked or terminated as provided elsewhere herein, shall be for an initial period of Eight (8) years from the date of this General Lehr Agreement with the privilege, if claimed by Whitall Tatum in writing before the expiration of the said initial period, of One (1) renewal for a supplemental period of Eight (8) years, upon all the conditions hereof, and without additional licensee fee for such renewal.
SECTION 5 HARTFORD RETAINS
TITLE.
It is understood and agreed that Hartford and its successors and assigns, retains, and at its own option shall continue to retain throughout the term of this General Lehr Agreement complete title to said leased machines.
SECTION 6 PLACE AND NATURE
OF USE.
(a) Said leased machines and all improvements thereon shall be used only for the annealing or treatment of the glassware defined as "Permitted Ware" in Schedule C annexed hereto, and only at plants of Whitall Tatum located at Millville, New Jersey, or at any other plant now or hereafter owned by Whitall Tatum.
(b) The said leased machines are designed, developed and adapted especially for use with other glass machines controlled by the Licensor. The grant of rights herein to use such leased machines and to use the said patent rights therein embodied, is therefore restricted and limited as follows: in case the said leased machinery shall at any time be used by the Licensee for the annealing or treatment of glassware produced by the aid of any feeding machinery not then controlled or under license from the Licensor, and such use shall continue after the Licensee shall have received from the Licensor written notice of objection to such use, then in such case the Licensor reserves the right, in its option, to revoke and cancel this license and lease, upon paying to the Licensee the amount of one year's minimum royalty hereunder.
SECTION 7 PROHIBITION OF
ASSIGNMENT.
The said leased machines shall be used only by Whitall Tatum or its operatives, and only at the plant or plants aforesaid. The said leased machines, the individual licenses and leases covering them, and this General Lehr Agreement shall not be transferred, assigned or sub-let by Whitall Tatum, except to the purchasers of its entire glass manufacturing business. If any one of them be otherwise transferred, assigned or sub-let, or if Whitall Tatum discontinues for a period of more than One (1) year the treatment of glassware under this General Lehr Agreement, or is adjudicated bankrupt, or a receiver is appointed over it, or if Whitall Tatum makes any general transfer or assignment for the benefit of creditors, then and in any such case this General Lehr Agreement may, at the option of Hartford, be terminated.
SECTION 8 CHANGES, ADDITIONS
AND IMPROVEMENTS.
(a) No changes and no additions other than reasonable and necessary repairs and other than necessary or proper safety appliances, shall be made in or to said leased machines except by consent of both parties to this General Lehr Agreement, or except as provided in Section 13 hereof for the event of injunction , and except as provided in this Section for improvements; and all changes and additions when made shall become the property of Hartford. Complete title to all patent rights at anytime possessed during the term of this General Lehr Agreement by Whitall Tatum covering such changes and additions to said leased machines shall be transferred to Hartford.
(b) Whitall Tatum shall, during the term of this General Lehr Agreement, begiven the benefit, for the purposes set forth in and permitted by Section 6, of any and all improvements for use in and upon said leased machines, which maybe devised, developed or acquired by Hartford, if and when said improvements shall, with the express consent of Hartford, have been used commercially in the United States upon said leased machines in the making of glassware, or upon machines of identical type used by other licensees of Hartford. In such event Hartford will, upon written request of Whitall Tatum, furnish to Whitall Tatum with reasonable promptness, such parts as may be needed to apply the said improvements to the said leased machines and at prices similar to those charged by Hartford for such parts to other similar licensees. Such improvements shall be used by Whitall Tatum only in or upon the said leased machines, and only during the term of this General Lehr Agreement. All parts displaced from said leased machines by the said improvements shall be returned to Hartford.
The word "improvements," when used in this General Lehr Agreement shall beheld to mean only (1) substitution of new parts for old parts of said leased machines; or (2) changing old parts thereof; or (3) addition of new devices which are intended and adapted to become integral portions of such machines and to perform only one or more of the original functions of such machines; and not otherwise. Furthermore, the said word "improvements" shall not be held to include machines of size or capacity greater than said leased machines, even though of similar or identical function or functions.
SECTION 9. ROYALTIES MINIMUM
ROYALTY-REPORTS.
(a) Whitall Tatum shall pay to Hartford during the term of this General Lehr Agreement a royalty of Five Dollars ($5.00) per machine for each day during which each of said leased machines are used.
PROVIDED, however, that the royalty per machine for each of said leased machines for any one calendar month shall not exceed One Hundred Dollars ($100). Such royalty shall be paid monthly at Hartford's office in New York funds on or before the fifteenth day of each month for the use of said leased machines during the preceding calendar month.
(b) Whitall Tatum shall pay in royalties a minimum royalty under this General Lehr Agreement of not less than Six Hundred Dollars ($600) per year on each machine, payable in New York funds at Hartford's office on or before the fifteenth day of January for the year last of this preceding during entire term General Lehr Agreement,
PROVIDED, that in the event that Whitall Tatum shall pay in any one year under the paragraph (a) of this Section 9 royalties in a sum equal to or exceeding Six Hundred Dollars ($600) multiplied by the number of machines under license for that year, no royalties shall be payable under this paragraph (b) for that year.
(c) Whitall Tatum shall on or before the tenth day of each month furnish to Hartford upon blanks provided by the latter, properly certified statement showing the number of days that the leased machines are operated during the preceding calendar month.
SECTION 10. INSURANCE.
Whitall Tatum shall also at its own expense procure and place in the hands of Hartford good policies of insurance against fire upon such leased machines to the amount of the full insurable value thereof, payable in case of loss to Hartford; shall also pay all taxes assessed against said leased machines, and shall hold and save Hartford harmless against any and all damages and costs resulting from injury occurring to any of Whitall Tatum's employees or others on account of or in connection with said leased ma-chines, subsequent to the installation thereof.
SECTION 11. OPERATION OF
MACHINERY.
Whitall Tatum shall keep, use and operate said leased machines and all parts thereof in a careful, safe, prudent, and proper manner; shall maintain the same in good order, damage by fire excepted as hereinafter set forth; shall not, without consent of Hartford, add to or subtract from such leased machines as supplied by Hartford, excepting necessary or proper safety appliances, or allow changes to be made therein, or interfere with the proper operation thereof, or remove or deface any plates, dates, numbers or inscriptions placed thereon by Hartford. Whitall Tatum shall promptly notify Hartford of the need of any repairs or renewals of said leased machines, and Whitall Tatum shall at its own expense effect such repairs and renewals, purchasing the necessary renewal parts from Hartford. Hartford agrees to furnish promptly such renewal parts at prices not in excess of the prices charged by responsible outside parties for parts of similar design, materials and workmanship. If Hartford declines or neglects so to furnish such parts, Whitall Tatum may procure them elsewhere , but they shall not be installed on such machines until they have been inspected and approved by are presentative of Hartford. Whitall Tatum shall pay for the reasonable time and expenses of such representative.
SECTION 12. ACKNOWLEDGING
VALIDITY OF PATENTS.
So long as this General Lehr Agreement remains in force, Whitall Tatum agrees not to dispute the validity of the Letters Patent under which this General Lehr Agreement is granted, some of which Letters Patent are set forth in Schedule C annexed hereto, so far as these patents apply to the methods and machines which are hereby licensed to Whitall Tatum.
In case a final decree shall declare to be void all or substantially all of Hartford's patents embodied in and relating to the said leased machines, so that Whitall Tatum is thereby evicted from all or substantially all of the benefits of this General Lehr Agreement, then and in that case Whitall Tatum may at its option revoke and terminate this General Lehr Agreement, in which event Whitall Tatum shall thereupon restore to Hartford all of the said leased machines and their appurtenances as provided in Section 16 hereof, and shall thereupon be relieved from paying further royalties; PROVIDED, however, that until such revocation and restoration Whitall Tatum shall continue to be bound by all the covenants and provisions of this General Lehr Agreement.
SECTION 13. SUITS FOR
INFRINGEMENT.
(a) Hartford will at its own expense defend any suits or claims brought against Whitall Tatum for alleged infringement of patents based on the use of the said leased machines, unless or until Hartford shall elect to effect a settlement thereof. Whitall Tatum shall promptly inform Hartford of any such suit or claim, or any threat or probability thereof, coming to the knowledge of Whitall Tatum, and shall, at Hartford's expense, fully and freely aid Hartford in defending the same; and shall further promptly inform Hartford of any infringement of Hartford's patents coming to the knowledge of Whitall Tatum.
(b) Hartford shall have the right to intervene in and defend, as a party thereof, any suit brought against Whitall Tatum during the term hereof which involves any contention that the making, selling or use of such leased machines, or any improvement or part thereof constitutes an infringement of any patent.
(c) In case Hartford shall be delayed in the performance of, or be rendered unable to perform all or any part of this General Lehr Agreement, by reason of strikes, unavoidable accident, the non-arrival of machines or materials, or if the installation or operation of the said leased machines shall be delayed or stopped by the process or order of any court of competent jurisdiction, Hartford shall not be liable to Whitall Tatum for any loss, delay or damage incurred thereby, PROVIDED, however, that if the right of Whitall Tatum to use the said leased machines, or any part thereof, shall be suspended by reason of an order, decree or injunction issued by any court of competent jurisdiction, then during the continuance of restraint by such order, decree or injunction, or until Hartford shall have substituted other machines or parts as hereinafter set forth which Hartford agrees to do as promptly as reasonably possible, all the royalties set forth in Section 9 hereof shall be waived.
(d) In the event of such an order, decree or injunction being issued against any part or parts of said leased machines, Hartford reserves the right to substitute with reasonable promptness other machines or parts for those involved in the injunction and at no cost or charge to Whitall Tatum excepting any license fee or royalty which Hartford may have to pay for the right to make, and license Whitall Tatum to use such other machines or parts. The part or parts so substituted shall be of an efficiency substantially equal to that of the part or parts so involved in said order, decree or injunction and shall immediately become subject to all the provisions of this General Lehr Agreement.
(e) In the event that such order, decree or injunction shall become permanent against any part or parts of said leased machines, and no substitution of machines or parts shall have been made with reasonable promptness as above stated, then in that event this General Lehr Agreement shall cease and terminate in all its provisions.
SECTION 14. RIGHT OF REVOCATION.
In case Whitall Tatum shall violate or fail to observe any of the conditions set forth in Sections 3, 6, 7, 8, 9, 10, 11, 17 and 18 of this General Lehr Agreement, or shall cause the same to be violated, Hartford shall have the right at its option, to revoke and terminate absolutely this entire General Lehr Agreement or any individual license and lease issued hereunder upon giving written notice to Whitall Tatum of said revocation at least thirty (30) days before the time when such revocation is to take effect.
Except as provided in Sections 12, 13,15 and 18 no termination or revocation whatsoever of this General Lehr Agreement under any section hereof, nor the use of the remedy of injunction, accounting or repossession shall, however, affect or in any way discharge the liability of Whitall Tatum hereunder, to pay and to continue to pay to Hartford, the minimum royalty provided by Section 9 hereof, for and during the entire term of this General Lehr Agreement, including its supplemental period if entered upon, nor shall any royalties paid by Whitall Tatum be returned.
SECTION 15 COMMUTATION OF
ROYALTIES.
It is further agreed that in the event of such revocation set forth in Section 14, Whitall Tatum, in lieu of said obligation therein provided to pay the said royalties throughout said entire term, may at its option wholly discharge said obligation by paying to Hartford within sixty days after said revocation a lump sum equal to Fifty (50) per cent of the minimum royalties (provided by Section 9) which would under this General Lehr Agreement be payable during the remainder of said term, including its said supplemental period if entered upon; and provided further, that Whitall Tatum may at anytime during said term, including said supplemental period, revoke and terminate this General Lehr Agreement in its option, by giving written notice to Hartford sixty (60) days beforehand of its intention so to revoke and by paying to Hartford within said sixty days a lump sum in discharge calculated as above set forth in this Section.
SECTION 16 RE-POSSESSION OF
THE MACHINES.
Upon the termination of this General Lehr Agreement at the end of its initial or supplemental period or sooner as herein provided, Whitall Tatum shall return to Hartford the said leased machines and all appurtenances thereof, covered by this General Lehr Agreement, in good condition, reasonable wear and use excepted, by delivering the same properly crated and packed f. o. b. cars at any convenient freight station near the plant of Whitall Tatum. If Whitall Tatum shall fail to deliver the machines, Hartford is hereby authorized to enter upon any premises where the said leased machines may be and take possession thereof and remove them.
SECTION 17 INSPECTION.
Duly authorized agents or employees of Hartford shall at all reasonable times be allowed access to the said leased machines for the purpose of inspecting the same and their operation and use, and Whitall Tatum shall afford all reasonable facilities therefor.
SECTION 18 FIRE LOSS.
(a) In the event that the said leased machines shall be damaged by fire so as to cause a suspension of production there-with Whitall Tatum shall immediately give written notice to Hartford as to the extent and nature of the damage to the said leased machines, and as to the plans and intentions of Whitall Tatum relative to repairing the damage and resuming operations under this General Lehr Agreement.
(b) In the event of such damage by fire, Hartford, if so requested in the said notice, shall at its own expense and to an extent not exceeding the amount of insurance received, provide Whitall Tatum with the machines or parts thereof necessary to repair or replace the damaged machines or parts. Whitall Tatum shall at its own expense promptly and diligently proceed to install the said machines or parts thereof. From the time when said notice is received by Hartford and thereafter during only such time, not exceeding six months, as may be necessary for providing and installing the said machines or parts, all the royalties set forth in Section 9 hereof shall be waived.
(c) If Whitall Tatum shall not within six (6) months after the occurrence of the fire rebuild or otherwise repair the damage and resume operation under this General Lehr Agreement; or if Whitall Tatum shall fail to resume the payment of royalties when due, then in any of these cases Hartford shall have the right at its option to revoke and cancel this General Lehr Agreement.
SECTION 19 WAIVING THE
CONDITIONS.
None of the terms of this General Lehr Agreement shall be held to have been waived or altered unless such waiver or alteration is in writing, signed by an officer of Hartford expressly authorized thereto.
IN WITNESS WHEREOF the parties here to have hereunto set their hands and seals, acting herein by their respective officers duly authorized therefor.
HARTFORD-EMPIRE COMPANY,
By Roger M. Eldred,
General Manager.
Attest:
Arthur T. Safford, Jr.,
Secretary.
WHITALL TATUM COMPANY,
By T. C. Tatum,
President.
Attest: H. V. Brumley
SCHEDULE A
Annexed to General Lehr Agreement Dated
September 19, 1933.
LIST OF MACHINES
AND ACCESSORIES FURNISHED
(a) Hartford Lehrs Nos. 32, 82, 83, 110, 111, 114, 115, 142, 166, 180, 184, 185, 186, 199, 200, 232, 239, Class 133, Type D.
(b) Hartford Lehr No. 157 Class 133, Type E.
(c) Hartford Lehr No. 249, Class 133, Type F.
(d) Hartford Lehrs Nos. 233, 234, Class 133, Type G, equipped to anneal or treat ware specified elsewhere in this General Lehr Agreement.
INCLUDING
1. Motors to suit Whitall Tatum's current characteristics.
2. Motor Drive Chain and suitable speed change sprockets.
3. Control system including
(a) Built-in Pyrometer System.
(b) Draft Gauges.
3. Burner equipment for oil or gas (city or natural).
5. Bottle spacers suitable for hand setting-in to give any three rankings across Lehr. 8, 10 and 12 provided unless otherwise specified.
15-foot tunnel extension added April,1936, to Lehr No. 180.
(Exhibit No. 122)
(Received in evidence December 12,
page 208)
The Consolidated Stacker and
Conveyor Agreement between the
Hartford-Empire Company and
the Owens-Illinois Glass Company.
CONSOLIDATED STACKER AND
CONVEYOR AGREEMENT
Between
HARTFORD-EMPIRE COMPANY
And
OWENS-ILLINOIS GLASS COMPANY
THIS AGREEMENT, made and entered into as of the first day of October, 1935, between Hartford-Empire Company, a corporation of Delaware, having its principal place of business at Hartford, Connecticut, hereinafter called "Hartford," and Owens-Illinois Glass Company, a corporation of Ohio, having its principal place of business at Toledo, Ohio, herein-after called "Owens."
WITNESSETH:
That for and in consideration of One Dollar ($1.00) and other good and valuable considerations in hand paid by each of the parties to the other, receipt whereof is hereby acknowledged, and of the mutual covenants herein contained, it is agreed by and between the parties, Hartford and Owens, as follows:
Section 1. Existing Stackers. The Standard License and Lease form set forth in Schedule A annexed hereto constitutes the terms and conditions between Hartford and Owens relating to Hartford Lehr Stackers now owned by Hartford and in use at the plants of Owens and respectively identified by serial numbers as follows: 73 Stackers 82, 83, 84, 85, 119, 120, 121, 122, 124, 141, 135, 4, 20, 21, 22, 27, 28, 75, 76, 77, 89, 91, 103, 104, 123, 18, 25, 26, 30, 33, 34, 23, 54, 55, 56, 57, 61, 65, 63, 64, 70, 71, 72, 142, 143, 144, 145, 146, 147, 138, 139, 152, 151, 153, 159, 160, 131, 155, 94, 95, 96, 106, 107, 108, 117, 118, 109, 110, 111, 105, 9, 81, 116.
It is understood that receipt by Hartford of the "single sum" referred to is hereby acknowledged and Section 2 and Schedule B of said Standard License and Lease form are inapplicable to such stackers inasmuch as they are already installed.
Section 2. Existing Conveyors. The Standard License and Lease form set forth in Schedule A annexed hereto shall likewise constitute the terms and conditions between Hartford and Owens relating to Hartford Conveyors now owned by Hartford and in use in the plants of Owens and respectively identified by Serial numbers and type letters as follows:
Conveyors RV 36, 37, 38, 35, 48, 49, 50, 51, 53, 54, 63, 65, 52, 55, 56, 57
WVQ-77, 82
ZUQ-96, 101
To make Schedule A applicable to the Hartford Conveyor the words "Hartford Conveyor" shall be used instead of the words "Hartford Lehr Stacker" and Schedule B hereof shall constitute a further description of such conveyors. It is understood that receipt of the "single sum" referred to is hereby acknowledged and Section 2 and Schedule A of said Standard License and Lease form are inapplicable to such conveyors inasmuch as they are already installed.
Section 3. Licensing and Leasing of Aditional [sic] Additional Stackers and Conveyors. Upon the acquisition by Owens of any additional Hartford Lehr Stackers or Hartford Conveyors from Hartford a brief description or identification of such stackers and/or conveyors shall be added to Schedule B of this agreement by an amendment signed by duly authorized officers of Hartford and Owens and such stackers and/or conveyors shall thereupon be taken, installed, held, leased, licensed, used, operated, and returned subject to the terms set forth in Schedule A.
The amount payable for any such stacker and/or conveyor is not to be excess of the lowest amount charged by Hartford to others under similar circumstances and shall be payable according to the Hartford then existing standard terms.
Section 4. Extension of License and Obligations to Subsidiaries of Owens. A subsidiary of Owens is hereby defined as any corporation or association of which Owens owns over fifty percent of the voting capital stock or has equivalent ownership. The rights acquired by Owens hereunder are hereby extended to each and every present and future glassware manufacturing subsidiary of Owens, which rights, however, shall continue only so long as Owens holds such rights and such subsidiary remains a subsidiary of Owens. While any such subsidiary is enjoying such rights it shall be bound to Hartford for the obligations arising from the exercise of such rights. Owens shall be responsible to Hartford for the performance by every such subsidiary, while it remains an Owens subsidiary, of all such obligations to Hartford of such subsidiary.
IN WITNESS WHEREOF the parties hereto have hereunto set their hands and seals, acting herein by their respective officers duly authorized therefor.
HARTFORD-EMPIRE COMPANY,
By F. Goodwin Smith,
President.
Attest:
Arthur T. Safford, Jr.,
Secretary.
Signed October 14, 1935 10:10 A .M.
OWENS-ILLINOIS GLASS
COMPANY,
By William E. Levis,
President.
Attest: Owens-Illinois Pacific Coast Company hereby accepts the rights extended to it by the foregoing Agreement as a glassware manufacturing subsidiary of Owens and binds itself to Hartford for the obligations arising from its exercise of such rights, but upon the condition that it shall not be responsible for the acts or covenants of Owens or any other subsidiary of Owens.
OWENS-ILLINOIS PACIFIC
COAST COMPANY,
By Harold Boeschenstein,
Vice President.
Attest:
E. F. Martin,
Asst. Secretary.
SCHEDULE A
Annexed to Consolidated Stacker and
Conveyor Agreement
Between
HARTFORD-EMPIRE COMPANY and
OWENS-ILLINOIS GLASS COMPANY
Dated: October 1, 1935
HARTFORD LEHR STACKER
LICENSE AND LEASE NO. H. L. S.
Preamble
THIS LICENSE AND LEASE, made this....day of........ 19...., between the HARTFORD-EMPIRE COMPANY, a corporation organized under the laws of the State of Delaware and having a place of business at Hartford, Connecticut, hereinafter designated as LICENSOR, and .................a corporation organized under the laws of the State of ...........and having a place of business at.........., hereinafter designated as Licensee,
WITNESSETH: That in consideration of the covenants hereinafter set forth, and of the payment to the Licensor of the single sum of....., the said sum being in full for royalties covering the entire term of this license and lease, to be paid by said Licensee to said Licensor in the following manner......, to be paid upon the execution and delivery of this license and lease and the balance of......, within sixty (60) days after the "Hartford Lehr Stacker" described in Schedule "A" annexed hereto, hereinafter termed the leased machinery, is ready for shipment to Licensee, it is hereby mutually agreed as follows:
SECTION 1. EXTENT OF
LICENSE AND LEASE.
The Licensor hereby leases to the Licensee and hereby licenses the Licensee to use the said leased machinery. PROVIDED, HOWEVER, that this license and lease is limited (not absolute), and confers only the right to use said leased machinery in continental United States, and in the manner and for the purpose hereinafter set forth, and not otherwise.
SECTION 2. DELIVERY AND
INSTALLATION.
The Licensor, as soon as reasonably possible after the provisions of Section 1have been complied with, shall deliver said leased machinery f. o. b. at place of manufacture, and shall aid in installing said leased machinery as provided in Schedule "B" annexed hereto.
SECTION 3. TERM.
The term of this license and lease, unless sooner revoked or terminated as provided elsewhere herein, shall run until the expiration of the latest United States patent owned by the Licensor and embodied in said leased machinery.
SECTION 4. LICENSOR RETAINS
TITLE.
It is understood and agreed that the Licensor and its successors and assigns, retains, and at its own option, shall continue to retain throughout the term of this license and lease, complete title to said leased machinery.
SECTION 5. PLACE AND
NATURE OF USE.
(a) Said leased machinery shall be used only at plants owned by the Licensee.
(b). The said leased machinery is designed, developed and adapted especially for use with glass-annealing lehrs controlled by the Licensor. The grant of rights herein to use such leased machinery and to use the said patent rights therein embodied, is therefore restricted and limited as follows: In case the said leased machinery shall at any time be used by the Licensee for the handling of glassware, into, upon or in connection with any lehr or other glass annealing machinery not then controlled or under license from the Licensor, and such use shall continue after the Licensee shall have received from the Licensor written notice of objection to such use, then in such case the Licensor reserves the right, in its option, to revoke and cancel this license and lease.
SECTION 6. PROHIBITION OF
ASSIGNMENT.
Neither the said leased machinery nor this license and lease shall be transferred, assigned or sub-let by the Licensee, except to the purchaser of the entire business of the Licensee. If either be otherwise transferred, assigned or sub-let, this license and lease may, at the option of the Licensor, be terminated.
SECTION 7. RIGHT OF REVOCATION.
In case the Licensee shall violate or fail to observe any of the conditions set forth in Sections 5, 6 and 9 of this license and lease, or shall cause the same to be violated, the Licensor shall have the right at its option, to revoke and terminate absolutely, this license and lease upon giving written notice to the Licensee of said revocation at least thirty (30) days before the time when such revocation is to take effect.
SECTION 8. REPOSSESSION OF
THE MACHINERY.
Upon the termination of this license and lease at the end of its term, or sooner as herein provided , the Licensee shall return to the Licensor the said leased machinery and all appurtenances thereof and all changes and additions made thereto, covered by this license and lease, in good condition, reasonable wear and use excepted, by delivering the same properly crated and packed f. o. b. cars at any convenient freight station near the plant of the Licensee. If said Licensee shall fail so to deliver the machinery, the Licensor is hereby authorized to enter upon any premises where the said leased machinery may be and take possession thereof and remove it.
SECTION 9. INSPECTION.
Duly authorized agents or employees of the Licensor shall at all reasonable times be allowed access to the said leased machinery for the purpose of inspecting the same and its operation and use, and the Licensee shall afford all reasonable facilities therefor.
SECTION 10. WAIVING THE
CONDITIONS.
None of the terms of this license and lease shall be held to have been waived or altered unless such waiver or alteration is in writing, signed by an officer of the Licensor, expressly authorized thereto.
IN WITNESS WHEREOF each of the parties hereto has caused this license and lease to be executed in duplicate, and its name and behalf, as of the day and year first above written, the Hartford-Empire Company by........., Licensee, by ........., both thereto duly authorized.
SCHEDULE A.
Annexed to License and Lease No. HLS..
Date...... 19......
List of Machinery and Accessories
Furnished.
Stacker No.....
1. 1 Hartford Lehr Stacker, Class....Type.....equipped with parts shown below
2. 1 Ware Spotter
3. 1 Timer Valve
4. 3 Index Cams
5. 12 Tong Blanks
SCHEDULE B.
Of Schedule A.
Installation of Machinery.
1. The Licensor will furnish free of charge to the Licensee such general supervision as the Licensor may deem necessary in connection with the installation of the leased machinery set forth in Schedule "A" annexed hereto.
2. The Licensor will, if requested inwriting by the Licensee, furnish a competent machinist to direct and assist in the said installation.
3. The Licensor will, if requested inwriting by the Licensee, furnish a competent operator to instruct the Licensee's operators in the operation of the said machinery for a period not exceeding two weeks from the time the said machinery is installed.
4. The Licensee will pay to the Licensor the entire cost incurred by the Licensor under (2) and of instructions under (3), including the traveling and living expenses of the men furnished, plus 10% of the said entire cost.
SCHEDULE B.
Annexed to Consolidating Stacker and Conveyor Agreement between Hartford-Empire Company & Owens-Illinois-Glass Company
Dated: October 1, 1935.
List of machinery and accessories furnished.
Conveyor No ......
1 Hartford Ware Conveyor, Class...Type..... as identified by the following description:
Z Silent Chain V Pneumatically controlled,
Y Universal silent chain intermittent Geneva drive
X Malleable iron chain U Continuous drive
W Individual paddles T Uphill run
or supports for ware S Downhill run
R Slats on roller chain Q Dead plate with
ware pusher
(Exhibit No. 123)
(Received in Evidence, Dec. 12, Page 211.)
Letter from the Hartford-Empire
Company, dated August 26, 1932,
addressed to Mr. S. S. Searcy,
attorney, San Antonio, Texas.
August 26 , 1932.
S. S. Searcy, Attorney-at-law,
San Antonio, Texas.
Dear Mr. Searcy:
I received your courteous letter of August 23rd, and should like to employ you on behalf of Hartford-Empire Company in its contemplated suit against Three Rivers Glass, Company.
In this afternoon's mail there came another letter from Three Rivers Glass Company, as a result of which it may be necessary for us to change our opinion, but for the present we are still contemplating bringing suit.
There are a great many factors which I believe would be of considerable assistance to you in understanding the picture and in bringing the suit. For this reason I should like to meet you in St. Louis sometime between September 5th and September 10th.
If you could meet me there I could give you the contracts and the papers involved ,and also explain to you the whole situation. We could also meet one another and assure ourselves to our own satisfaction as to the calibre of the persons with whom we are respectively dealing.
Therefore, would you be good enough to either wire or write me if you can possibly meet me in St. Louis between the stipulated dates, and tell me what day is best for you? I have selected St. Louis as being the half-way point between San Antonio and Hartford, but if any other business should carry you North to some other point I could perhaps meet you there.
I enclose herewith opinions of the Circuit Court of Appeals in the cases of Hartford-Empire Company v. Hazel-Atlas Glass Company and Hartford-Empire Company v. the Nivison-Weiskopf Company, and also would like to refer you to Hartford-Empire Company V. Obear-Nester Company, 39 F. (2d) 769 and Homer Brooke Glass Company v. Hartford-Fairmont Company, 255 Fed. 901, affirmed 262 Fed. 427. These, I believe, will give you an adequate background of the glass art and the kind of machines which we call Feeders.
Hartford-Empire Company is engaged in the development and manufacturing of machines for making glass articles, and our two principal sources of income are from what we call Feeders and Lehrs.
These machines we lease and license under a standard form in which we retain title and in which, the licensee agrees to return the machinery in the event we revoke its license. The licensee pays royalties on each article of glass manufactured with the Feeder, but in the case of the Lehr there is a flat monthly amount payable for the use of the lehr. We have a provision in the contract that if the licensee fails to pay its royalties we are entitled to revoke its license.
In August, 1929, Three Rivers Glass Company was operating four machines which infringed our patents. They came to us and wanted a license under our patents and agreed to pay damages for their past infringing use. They also wanted a license to make milk bottles, but by reason of our prior commitments we were not in a position to give them a license for milk bottles.
We finally licensed them to use three Feeders, but the fourth Feeder we did not license, and since then they have continued to make milk bottles on a machine which we believe, to infringe our patents. We have not brought suit against them for this infringement mainly on account of the expense involved in bringing such a suit for just one machine, and also because we have been fully engaged in trying suits and arguing appeals in cases in the Third , Sixth and Eighth Circuits opinions to which I have referred you above.
In 1930 Three Rivers Glass Company substituted our Hartford Single Feeders for their other Feeders. Since then they have been consistently behind in their payment of royalties. Last Fall we told them that we were going to revoke, and at that time they promised most faithfully to keep up their payment of royalties, and we permitted them to continue, They are far behind now and we have sent them notice that their license is revoked, the revocation to take effect September 1st.
We control 90% of the glass feeding machines used in this country, although there are certain other methods of making glass-ware. In return for the various manufacturers paying us royalties we render to them general engineering service and are in much closer contact with them than if we were merely a selling house. We get all their problems and hear all their troubles, and wherever possible try to assist them.
Three Rivers Glass Company has been a perpetual thorn in the side of all the manufacturing companies. It won't assist the other manufacturers in any manner in maintaining general price levels. It isn't because they are more efficient than anyone else (which is a justifiable reason of course for lowering the price), but because they are just simply selling at an actual loss in order to stay in business.
We should like, for reasons of the general commercial situation and also because we feel there is no hope of Three Rivers ever paying us, as they should, to take the machinery out of their factory. This may, of course, seem to you to be a hard-boiled attitude, and of course it seems that way to the Three Rivers Company. We would prefer not to take such a drastic step, but the fact that they are using an infringing feeder, that they are always behind in their royalties and in their paying for spare parts, and the fact that they are a perpetual nuisance to the other manufacturers makes it imperative for us to proceed against them.
I am having prepared copies of the contracts and all of the correspondence which might possibly relate to this matter, and this material I could bring with me when I saw you.
We have also pending in the District Court for the Eastern District of Pennsylvania a similar suit which is to be tried in October, and I enclose herewith a copy of the complaint in that case.
Your suggestion that the suit be brought in Federal Court I believe is very wise, and a suit for specific performance of the contract to return the Feeders is the kind of action which seemed most advisable in Pennsylvania.
I enclose herewith a copy of our Standard Hartford Single Feeder contract which is practically the same as the one which Three Rivers entered into for its Three Hartford Single Feeders, and I also enclose herewith a Hartford Lehr Contract. These will give you the opportunity of seeing on what basis we make our legal claims for the return of the Feeders.
You, of course, know your courts and their slant toward any particular question, so that if during the course of our dealings with you you feel it is wiser to do one thing or the other I should not want you to refrain from giving your opinion.
Very truly yours,
HARTFORD-EMPIRE COMPANY
Secretary.
(Mr. H. T. Safford, Jr., left before he was able so sign this letter. R . L. B.)
(Exhibit No. 124)
(Received in evidence Dec. 12, Page 211.)
Memorandum as to Hartford-Fairmont
and Hartford-Empire
history and policy, extracted from
the files of the company.
March 26, 1928.
Memorandum as to Hartford-
Fairmont and Hartford-Empire
History and Policy.
For Mr. Safford
HISTORY
The Hartford-Fairmont Company was organized in 1912. You can get the best background for the history of this company by reading my brief and findings in our Board of Tax Appeals case in the appeal of the Hartford-Fairmont Company. I want to add also some further considerations of this history.
(1) The glass industry (excluding sheet and plate glass with which we have nothing to do) was in 1912 in a backward state mechanically and just about right for change to automatic machine processes in order to meet the change of American industry toward mass production. Our development, therefore, came at the moment when it was needed and the result has been that the glass industry has absorbed from us a very large amount of expensive machinery.
(2) Our process had one important rival The Owens Bottle Company the most powerful glass concern in the world. Its process was entirely different from ours. It came into commercial use about 1905 and dominated the industry until about 1917 when our process began to get a foot-hold. Up to 1924 there was sharp conflict between us and Owens, with some patent litigation. In 1924, after long negotiation, the two companies got together in a cross-licensing arrangement and have since then worked in exceptionally close understanding. There is, however, no combination between the two.
(3) We began our commercial expansion in 1917 when our first feeders were put into production. It was at once apparent that if we put out these machines broadcast, without restriction, we would disorganize the whole industry which was then divided into a large number of small units and most of these manufacturers would not be able to refrain from using practically all the savings produced by these machines in fighting with each other. In fact, our first group of licensees said so expressly and urged us to take measures to prevent such a result.
(4) Consequently we adopted the policy which we have followed ever since of restricted licensing. That is, to say,
(a) We licensed the machines only to selected manufacturers of the better type, refusing many licensees whom we thought would be price-cutters, and
(b) We restricted their field of manufacture, in each case, to certain specific articles, with the idea of preventing too much competition.
(c) In order to retain more complete control of the situation, we retained title to the machines and simply leased them for a definite period of years, usually 8 or 10 years, with the privilege of renewal of a smaller additional term.
(5) In specifying the various fields of ware for a given licensee, we have, with a few exceptions, based the classification upon the use of the article rather than shape or other physical characteristic. Glass containers have so many shapes that it is practically impossible to classify them by shape and very often numerous different shapes will be used for the same purpose, so that use of the container is the basis for our classification except in a few cases.
(6) Quite early in our history we foresaw that the glass industry, like others, would doubtless go through a process of combination, which as a matter of fact has occurred. We felt it to be to our best interest, as well as for the best interest of the whole industry that we should use our influence to steady the industry as much as possible, with a long-distance view towards its general prosperity. The men at the head of our concern took this long-distance view deliberately and have ever since maintained it. For example, although the Hartford-Fairmont Company was organized in 1912, it paid its first dividend on its common stock in 1924. Up to that time it had put back into development all of its profits and considerable amount of cash received from sale of patents abroad.
(7) We have thus gradually evolved the theory of what may be called a "glass equipment concern." In this change of the industry to mechanical equipment, two courses were theoretically possible for the manufacturer.
(a) He might at his own expense develop automatic machinery and protect the same by patents for his own benefit. Such development and patent protection is an extremely expensive process and if the manufacturers generally had followed this course, there would have been a very large duplication of effort and expense.
(b) On the other hand, the manufacturer might select some outside concern, like the Hartford-Empire Company, entrust to it the work of developing and protecting machinery of the glass industry generally and support that concern in its development by paying a proportionate contribution which in this case was best measured by royalties on production.
(8) The latter course was the one which the manufacturers very wisely chose. The result has been that the Hartford-Empire Company has now become the most important glass equipment concern in this country and probably in the world. This means that H-E has a duty toward the whole industry not only of developing and supplying machines immediately needed, but of keeping in advance of that need by inventing further improvements. It also must act as a source of service and information for its licensees in all technical matters relating to their business and must help to steady, as far as possible, the general glass industry. H-E has done this to the best of its ability; has spent enormous sums in machine development and patent litigation, as well as in research along mechanical, physical and chemical lines.
(9) As to the foreign situation, we have pursued a somewhat different policy. In most cases we have sold our foreign patents outright, it being too difficult to establish a workable licensing system abroad where we could not be in touch with our licensees and could not give them service. We have sold foreign patents in some 15 or 20 countries and have especially close working arrangements with British Hartford-Fairmont Syndicate, a London concern, and St. Gobain Glass Company in Paris. We have still a number of foreign patents unsold, especially in Central Europe.
(10) One special line of recent development has been in refractories. Glass is melted in a large tank holding from 200 or 300 tons of molten glass and the tanks built of ordinary fire brick wore out rapidly, usually lasting not more than a year, with a very large expense to the manufacturer for replacement and especially for loss of overhead and business during the replacement.
(11) In combination with Corning Glass Works with whom we have rather close working alliance we have gone into a development of glass tank refractories of a much higher quality and the two companies have joined in erecting a plant for making these refractories in Louisville, Ky., by means of the Corhart Refractories Company and are just beginning production.
GENERAL CONTRACT POLICY
It will be easily understood that with the foregoing history, the contract relations of H-E are very complex and numerous. They involve several different classes of contracts
(a) The ordinary standard licenses of feeders, forming machines, lehrs, stackers, conveyors and the like which are almost always represented by printed forms which differ usually only in the field of ware permitted.
(b) Contracts which have arisen as the result of conflict or duplication of development between H-E and other important companies. These are specially represented by our contracts with Owens and with the Corning Glass Works, which, broadly speaking, are in the nature of cross-licenses.
(c) Contracts which have arisen as the result of our acquisition of other concerns and processes, illustrated by our contracts by which we purchased patents and assets of the Howard Feeder Company and the patents, assets and licenses of Tucker, Reeves & Beatty.
(d) A fourth class, which is much like the first one, or what are known as "General Agreements." These arise simply where some licensee becomes so large that instead of issuing to that licensee a separate printed license for each machine, we make a general agreement with the licensee and simply issue a short form single page license to cover each machine taken. These General Agreements usually raise two or three important special questions. For example, the licensee in such case usually wants to be assured that he will get as many more machines as he may want, and secondly, that he will be able to get on reasonable standard terms our future developments along his line.
(12) One particular feature requires considerable attention, namely the so-called "exclusives." In the early history of the Company and in order to secure business, we granted to certain interests the exclusive right in certain of our machines for particular fields of ware. For example, we granted to four milk bottle manufacturers the exclusive right in certain of our feeders and forming machines for milk bottles. These concerns were later taken over by one concern which still holds that exclusive. We also granted exclusives on certain high qualities of glass and certain special lines of ware of the Corning Glass Works, such as bulbs, glass cooking ware, signal ware, etc.; also exclusives on lantern globes and one or two other minor lines of ware.
We have had so much trouble with these exclusives when dealing with other parties that our policy is now decidedly against them. We found that in making cross-licenses and adjustments of patent conflicts, these exclusives frequently stood in the way of such adjustments and caused us a great deal of trouble. It is, in fact, necessary to have these exclusives constantly in mind in considering any proposed contract.
(13) Another special feature is the so-called "most favored" provision. In number of the "General Agreements" the licensee has insisted that he get as favorable rates and terms as any other licensee of ours under like conditions. Also that if we later make such more favorable terms to others, then the same shall ipsofacto, come to him.
This, as you see, means that we must constantly be on our guard in granting new licenses or in widening old ones, because whatever concessions (generally speaking) we grant to a particular licensee, must at once be granted to all those enjoying the "most favored" provision.
(Exhibit No. 125)
(Received in evidence, Dec. 12, page 216)
Policy of the Hartford-Empire
Company, dated Feb. 18, 1930,
taken from the files of the
company, discussing the development
of the patent and licensing
policies of the company
MEMORANDUM ON POLICY
of
HARTFORD-EMPIRE COMPANY
February 18, 1930
The history of the Company shows a rapid growth. The first real royalty returns were received December, 1917 $11,392. Gross royalty returns for 1929 were $1,972,307.
The Company has been forced by trade and production conditions to develop many types of machines. First, the original paddle feeder then the paddle-needle feeder then the single feeder then two distinct types of full automatic forming machines which greatly increased output and speed of the feeders then an entirely new lehr then the paste mold machine, intended for greater bulb and paste mold tumbler production then a rather radical type of an individual section forming machines which has great merit in a limited field, but which did not prove toto be "universal" then automatic stackers, transfers, conveyors, etc., as well as very important developments of new refractory materials then some original work in furnace design and electric melting.
The business conducted by the Hartford-Empire Company may be divided into four distinct and important divisions, as follows:
(1) THE EXECUTIVE OPERATING DIVISION.
This Division handles all negotiations, and financial and legal matters. It includes the Accounting, Service, Installation, and Manufacturing Departments.
(2) THE PATENT DIVISION.
This Division handles all patent matters and inventions and patent litigation. It is responsible for the creation, filing ,and prosecution of all applications to patent issue.
(3) THE DEVELOPMENT DIVISION.
This Division consists of highly trained mechanical and technical engineers and inventors, as well as the drafting force. It is responsible for all invention and development work.
(4) FOREIGN DIVISION. This Division handles all foreign correspondence and shipments, and foreign patent work, and carries on preliminary negotiations for sale or license of patent rights or machines in foreign countries thus far in seventeen such countries.
POLICY OF A DEVELOPMENT
DIVISION
The question to be considered is a question as to the development of general equipment.
How far a general development and equipment company, like Hartford-Empire, should go in spending time and money in inventing and developing machines and processes for the glass industry, beyond immediate and specific needs where definite savings or income can be reasonably estimated.
To put it differently, all developments may be classified as follows:
CLASS A.
Continual minor improvements to Hartford equipment now in operation.
Examples: Forehearth improvements, giving better temperature control better shearing mechanism, feeder clay parts, lehr belts etc. etc. (Note) Licenses demand this kind of engineering work. It reduces their costs, retains their support, insures the maintenance of present royalty rates for Hartford, and often increases total royalty returns.
CLASS B.
Machines or apparatus of new design to be used with established machines, and which will give the whole unit much greater speed and efficiency, as well as a larger range of articles. Example: Canfield H. Paste Mold Machine Hartford Individual Section Machine also Automatic Stackers, Automatic Conveyors, and Automatic Take-Outs. These types should invariably increase royalty income.
CLASS C.
Specific equipment providing an entirely new source of incomes. Example: Hartford Lehr.
CLASS D.
Tank design, reductions in melting cost, and glass compositions. These have a distinct relation to machine equipment. In fact, any advance in furnace construction or glass composition may require a complete change in machines and auxiliary equipment. (Note) It therefore seems essential that Hartford should keep in close touch with all progress in tanks, melting and glass composition. It should be able to make contributions along these lines, as they are parts of the total production chain. Hartford has already protected itself to a degree in this field.
CLASS E.
General Research work and study and experiments covering means of producing an entirely new or radical process of fabricating glassware, which process, if successful, will supersede present methods, and will secure higher royalty rates.
During the last five years all development undertakings of every nature by the Development Division show a direct cost of $927,000 and an overhead expense (salaries and expenses not directly chargeable to these specific undertakings) of $259,000. Incidentally, the lead men of this Division have assisted in an advisory capacity and otherwise to all other Divisions.
Direct charges $ 927,000
Indirect charges 259,000
________
Total $1,186,000
Direct receipts from
development work put
into use $1,375,387
Total cost 1,186,000
Profit $ 189,387
Several of these development undertakings, to the cost of $75,000 and more, are still in process of completion, may yet have considerable earning power.
COMMERCIAL SITUATION
Prior to 1905 practically all glassware was produced by hand. At that time the Owens Suction Machine came into commercial use. By 1913 the Owens machine was producing a little less than 1/3rd of the country's total production of containers, estimated as 19,000,000 gross.
Now that total is about 30,000,000 gross, divided as follows:
40% made by suction machines.
35% "Hartford gob feeders.
25% "outside" feeders and by hand.
(Note) "Outside" feeders are gob feeders which infringe our rights, or any other form of automatic feeders controlled by others.
Thus in the last twenty-five years, and mainly in the last ten or twelve, the whole glass industry has become mechanized. This change has carried with it all the new problems necessarily arising from such a radical advance.
SITUATIONS WHICH HARTFORD WAS
FORCED TO RECOGNIZE.
Class A. Division Minor Improvements.
There can hardly be any grounds for criticism for development and engineering work falling under Class A.
Class B. Division Forming & Handling Machines.
As regards Class B. On the success of the Hartford feeder in 1918, it became clear that the then existing Forming Machines could not meet the speeds or capacity of the feeders. The Illinois Glass Company refused to take any interest in our feeders until we had efficient Forming Machines with feeders. Hartford then developed two types of Forming Machines, and immediately the Illinois Glass Company entered into a general agreement with Hartford.
The paste mold bulb and tumbler machine ("H machine") was undertaken for two reasons. First, as a more efficient machine to supersede the Canfield F. machine for bulbs. Second, to produce at a lower cost paste mold tumblers, which tumblers then had a considerable market. During the three year development of this machine two adverse things happened; (a) the Corning 399 bulb machine came into being; and (b) the "hot mold tumbler" captured a large part of the paste mold tumbler market. The "H" machine thus became obsolete. This is a good example of the unexpected changes in the industry.
The Individual Section Forming Machine developed by Hartford was under-taken because of a demand by Hartford's licensees for a four-mold machine especially adaptable for small orders. This machine, although it earned us last year $25,000 in royalties, has not proved to be a universal machine. It has, however, to some degree increased our feeder royalties. Certain types of ware can be made on it which can not be made on any other machine. Many original principles have been developed in it, applicable to other machines. These principles are now our property and are an important link in the development of any future Forming Machines by Hartford or by outsiders.
Some of the values of this type of machine have lately been depreciated by the Owens Plural Mold Process, for sucking up and forming of two, three, or four bottles at a time.
We do not consider this Individual Section Machine development as a loss, even though the machine itself will never show a cash profit.
Also falling under Class B. the Hartford company has developed Automatic Stackers (which automatically handle the ware from forming machines into lehrs) as well as Automatic Conveyors, and Take-Outs. These have proved not only profitable themselves, but have increased feeder royalties because they have insured a higher percentage of ware packed.
Because of the advent of the Knox-O'Neill machine, Hartford is again being forced to develop for its licensees a Forming Machine which, with Hartford feeders, will produce containers at less cost. Hartford would have much preferred to spend this money in more radical developments in furnaces or fabricating processes. But to meet an emergency, and to appease Hartford's licensees, it seemed to Hartford that it must furnish its licensees as soon as possible a new Forming Machine which would fulfill their requirements.
Class C. Division Specific Equipment to Earn New Income.
The Hartford Lehr speaks for itself as an outstanding development, exceptionally profitable. Domestic lehr royalties in 1929 amounted to $157,000. Foreign sales of lehr rights have amounted to $204,000. This lehr development represented as much of an advance in the art of fabricating glass as the feeder did over the hand process.
Class D. Division Tanks, Glass , Etc.
There are many sound reasons why we should apply money to Class D. The prestige of Hartford is such that many licensees have remained loyal and paid royalties without established patent protection. This is because of their belief that Hartford as a general equipment and development company stands ready to advise and assist them in all problems of fabrication of glass containers.
For example it is recognized to day that the cost of melting glass is excessive and represents far too high a ratio to the other costs. Our engineers know that substantial savings may be made by radical developments in tank design, by improved means of heat application, involving problems of combustion, by the use of improved refractories, and by the development of improved glass formulas for the increase of tensile strength and reduction of weight.
Hartford's expenditures in the development of new and better refractories seems entirely justified. Hartford has already acquired options on fairly valuable rights covering electric melting, and now owns rights for melting by revolving tanks.
Class E. Division Research & Experimental.
Hartford recognizes that the art of fabricating glass by the gob feed method is well established, and that there is probably no chance for radical developments along this line per se.
Hartford also recognizes that the big Owens Suction Machine is well established, and that there is probably no chance for radical development there.
On the other hand, Hartford in looking towards the future has a very strong incentive for carrying on considerable research and experimental work along two distinct lines.
One line is a combination of methods somewhat approaching gob feeding, known as the Howard Auto-Blow.
Another line is a simplification of and elimination from the big Owens Suction Machine method.
The preliminary work done on these lines justifies further research and experiment. If Hartford's patent position should fail, then it should have ready a new process which so far exceeds the gob feed process that Hartford will not only maintain its licensing position, but increase the royalty rates.
Hartford always has very practical considerations for developing, if possible, a radical suction method clear from Owens patents. If this can be accomplished commercially Hartford would be relieved of paying Owens a tribute of some $500,000 a year.
Hartford feels justified , therefore, in making a budget allowance for Division E.
REMARKS.
It should be thoroughly understood that Hartford's development problems are of a universal nature. They are not confined to any one specific set of problems pertaining to any one article.
When a manufacturing company undertakes to create for itself improved machinery, that machinery merely (a) has to meet a certain specific and comparatively narrow line of product; (b) under one particular set of conditions; and (c) will be developed and used practically by the same personnel that is directing the main production work of the company.
Equipment developed by Hartford, on the other hand, must produce efficiently all kinds of glass containers of various shapes, capacities and weights. Hartford could not afford to consider any particular manufacturer's problem in regard to one particular article unless the manufacturer guaranteed to reimburse Hartford for the full cost of the development plus a profit.
The Hartford feeder is now delivering glass from 1/2 oz. up to 5 lbs. The container manufacturers are not interested in Hartford equipment unless it will handle their entire line of ware. This adds many burdensome problems to the development and engineering staff of Hartford. You many have a most efficient means for producing a 5 oz. bottle. You may have a most efficient means for producing a 16 oz. or 20 oz. bottle. But a machine to produce both must be a compromise.
ACTION REQUIRED TO MEET
CONDITIONS.
It is impossible to meet such diverse conditions without a very general (as distinguished from specific) knowledge of glass and mechanical problems. In other words, that knowledge must approach much more nearly that which results from general research.
The element of time adds a further uncertainty. The average time between the first conception of a new machine and its final commercial success is about 3 years. This period permits of important changes in the whole art. Only fairly general knowledge, experience, and experiment can qualify an organization to meet the contingencies that thus arise.
LACK OF PRECEDENTS FOR POLICY
It is difficult to make convincing the proper policy for the Development Division (which in itself is really a Development Company) because such companies are exceedingly rare. Precedents are almost wholly lacking, and Hartford has been obliged to chart its own course in a large and fast changing field of conditions. The main fact, however, that Hartford has come up from insignificance, beginning with a few patent applications and no income, to its present position of large income, wide range of patents, and its unique standing in the industry, all in the course of less than fifteen years, and apparently has made only a few serious mistakes, and none fatal, is a fair evidence that its policy in general has been substantially correct.
It has been by no means an easy or routine task to steer a correct course during the enormous changes in methods, combinations and business conditions arising in this period. Hartford has followed one definite policy, namely, that the future success of the Company could not rest on feeder income alone, but that the growth and asset position of the Company could only be insured by a development of methods and equipment applicable to the entire art of fabricating glass containers. Hartford has considered that the entire chain comprised the furnace link, the melting link, the feeding link, the forming link, the annealing link, with such auxiliary equipment as was applicable to each of these links. and that it would be a shortsighted policy to merely confine our efforts to the feeding link alone.
Hartford feels that this policy has justified itself, even though the profits over the past five years have probably been less than if Hartford's policy had merely concentrated on one line. Hartford is definitely convinced that the narrower policy would have been unsatisfactory to its licensees, and would not have assured Hartford of their support. Neither would Hartford's organization have developed its potential ability or knowledge of glass fabricating problems. Neither would the value of the capital stock of the Hartford-Empire Company have approached its present considered value, a recent sale in the open market having taken place at $62 a share.
Hartford points to the example of what took place in the Owens Company.
This Company years ago thought that their suction machine would for all time dominate the industry. They therefore practically abandoned development and research work as too costly. When the original Hartford feeder came into being, they took no stock in it, did not recognize the future of gob feeding, and deliberately let gob feeding come into commercial use. They thus sacrificed welfare and profits.
After gob feeding was established the Owens Company spent $1,000,000 in building a Forming Machine for gob feeders. A few were built, but have been abandoned.
LONG DISTANCE POLICY
The Management at Hartford feels that, if we are to have the same success in the future that we have had in the past, and if we are to provide for a long future of satisfactory income, we must keep in the forefront of development.
We believe that a certain proportion of our development budget must go to pure research and experimental work.
Three years is the normal period from invention to commercial sucess [sic] success of a machine or process. Hartford must be ready to supply improvements when needed, or others, more prepared, will get the business. Hartford must therefore look ahead and be ready.
All licensees have an inherent dislike to paying royalties, but they will pay royalties if they are assured that Hart-ford will apply some of those royalties to an extensive development program. They probably would prefer to have Hartford do development work for them ,rather than attempt it themselves, and they recognize that Hartford has built up a strong organization, skilled and adapted to such work.
They therefore have a right to expect Hartford to be continually working on methods and equipment to reduce their costs.
It is a most difficult thing for Hartford intelligently to budget the costs or results to be obtained under Classes D and E until such developments have passed through the experimental stage, and have received the general report of the Patent Department, and a design has taken a definite form.
An example of this is the Howard Auto-Blow. Howard is now experimenting with crude and inexpensive apparatus in testing out an invention which seems to be based on sound fundamentals.
Two practical glass problems have arisen in actual experiments. Howard thinks he can overcome these problems, but just when or how remains to be seen. It may be two weeks, or it may take three months. His solution may be quite simple, or fairly complicated. No one knows. But we all agree that, if successful, his contribution will be very valuable and far in excess of any cost involved during the experimental stage.
The same consideration must be given Peiler and Canfield, who have produced some very interesting preliminary experiments applied to suction.
It is quite a simple matter to make up the Development Company budget in advance, by quarters of a year. It is not a simple matter to make up the budget for the entire year, except of course we do, and always have, decided at the first of each year that we will allocate to the Development Company for the year a total amount of money. This total has been fairly rigidly adhered to barring one or two exceptional cases, but at the end of each year we have found that we have spent much more money on Projects 2 and 3 than we anticipated, and much lesson Projects 4, 5, and 6.
PATENT DIVISION
The question here is: How far should we go in prosecuting inventions to patents, beyond those inventions which clearly cover machines in commercial use.
THE MAIN
PURPOSE IN SECURING
PATENTS
In taking out patents we have three main purposes:
(a) To cover the actual machines which we are putting out, and prevent duplication of them.
The great bulk of our income results from patents. Between a feeder protected by patents, and one not so protected, there is the cash difference between one ordinary manufacturing profit of say $1,500, and a royalty return of at least $30,000 over 8 years. This theory also applies to other equipment.
(b) To block the development of machines which might be constructed by others for the same purpose as our machines, using alternative means.
We have in mind such machines as the Hillman machine; the Roirant type of machine; the Knox-O'Neill machine; improved stream feeders; vacuum and pressure feeders; ribbon feeders; and auto-blow methods of feeding, as well as various types of pure forming machines.
To ignore this form of protection may result in a competitor's having an estoppel or hold on our own developments.
(c) To secure patents on possible improvements of competing machines, so as to "fence in" those and prevent their reaching an improved stage.
There is also another, rather minor, purpose in securing patents. It corresponds with research in machine developments. Occasionally patentable ideas will appear which deal more with general principles. They may have no immediate and apparent application. But they may so relate to the possible future as to merit some time and expense.
UNCERTAINTY AS TO PATENT
FUTURES
Nothing is more plain from our actual 17 years' experience than the uncertainty as to the future practical value of a given patent claim. In estimating this we are faced with several unknown quantities.
(a) We do not know what claims by other inventors may be in the Patent Office.
(b) We can not tell what "anticipations" of domestic and foreign patents may finally be cited against us when we get into Court.
(c) We can not tell what will be the final form of the machine we are trying to cover, or what form of words will best cover it.
It has happened several times that we have actually developed an efficient machine to a working stage before our Patent Department could determine and formulate its real patentable features, or decide whether the machine was free from patents owned by others.
Take our lehr. Several large concerns attempted for years to develop a self-heating lehr. Then our lehr came along and swept the market. But it was not until after it had been considerably developed that our Patent Department and inventors finally analyzed the features that were patentable and that made our lehr superior.
This shows how uncertain the future is as to patent claims, and how unsafe it is to take a particular claim and asume [sic] assume it will be the one which three, five, or ten years later we shall be glad to rely upon in Court.
Thus the only safe thing to do is to cover all possible forms of claims, well knowing that many of them will be superfluous.
CONCRETE EXAMPLES
The "Plunger Principle"
The following examples illustrate the foregoing. The most striking is our experience with the "plunger" principle, as exemplified by our paddle-needle feeders and single feeders an experience which still rouses active emotion and disputes in our organization.
In the early days of 1912 and 1913, Mr. Peiler developed definite ideas as to both the paddle feeder and the plunger feeder. For various reasons, those then in charge deemed it wisest to proceed with the commercial development of the paddle feeder. Mr. Peiler had demonstrated with tests the feasibility of both paddle and plunger. It was a case in which, as it has now turned out, the poorer of two alternatives was selected for the commercial development. The better (plunger feeder) principle was pushed aside for the time by the paddle feeder development. The plunger feeder was not actively worked upon again until1916 and later.
For various reasons unnecessary to mention, no patent application was filed during 1913, 1914, 1915 and 1916 upon the plunger feeder.
The result of this failure to file on this alternative form, gave others a chance to obtain positions in the plunger feeding art which put us to great expense in interference proceedings and made necessary the purchase of Howard and Miller, and has caused us a tremendous amount of work and added expense in our suits.
There is no doubt that had the conditions been but slightly different, we would have lost the benefit of Peiler's work on this principle.
Example 2. The Lott Patents.
A different example is that of the Lott patents. We probably could have bought these in 1918 for around $15,000. Their future importance was not seen. We turn-ed down this purchase under definiteorders to reduce expenditures . And yetthese patents finally became the main in-ducement in forcing us to go into the"Owens General Agreement", under whichwe have paid Owens large sums up to dateand will continue to pay still more in thefuture. There are a number of other pat-ents in this class.Example 3. Heavier Than Glass Patent.The "HeavierThan Glass Patent" which,in its inception was not given more thanordinary value, has now a quite importantbearing on the entire refractory situation.Example 4. Knox-O'Neill Machine.Whitall-Tatum, back in 1911 and 1912 ,practically invented and developed theKnox-O'Neill machine, but it was thencompletely covered by the original Owenssuction patents (now expired) and theyabandoned the development.In the meantime, the inventor who wasassociated with them, Mr. Cox , took outa patent which lay dormant for someyears. Then, on the rise of the presentKnox-O'Neill machine, it became suddenlyof obvious importance. We had to buy itfor $5,000 , and it may become worth agreat deal more than that in our generalattack on the Knox-O'Neill machine.Example 5. Peiler Punty Patent.This case is fresh in memory. This wasa patent of 1926, but an invention of 1912.Suddenly its application to the DannerTube Machine became apparent, and werealized $350,000 on it.Example 6. Empire Machine CompanyPatents.There is the case of the patents of theEmpire Machine Company, based on whichthat Company was able to acquire a verylarge interest in Hartford-Empire Com-pany after having, prior to that time, se-cured extraordinary earnings from them."FENCING IN"Many further examples can be citedwhere applications now owned will have adistinct bearing on our future develop-ments, as well as on developments in manylines by others, and it would seem to usto be the wisest and safest policy to pro-tect all ideas which are so new as to havepatentable possibilities.We now have a number of applicationswhich were filed to definitely forestall thedevelopment of competing machines byothers.
CONTINUING THE MONOPOLY BY
US OR OTHERS
It often happens that if minor improve-ments are protected by patents, machinesand processes licensed under the originalbasic patents are given a much longerearning life by the fact that the minorimprovements continue the protection onthe machines, and even when the basicpatents expire, others are prevented fromusing the latest commercial form of themachine.Example :The Owens basic patents expired severalyears ago. Nobody, however, dare use thepresent type of Owens machine because ofimprovements covered by minor patents .Likewise, if the original patent protectionobtained on particular machines shouldnot be sustained bythe Courts, yet a sec-ond line of defense patents covering de-tails and improvements may become amost valuable asset.It has always been our ambition toobtain patents which will be related tofurnace, melting and refining, feeding, de-livery, forming, automatic handling, car-rying, stacking and annealing . Conceiv-ably we might lose patent domination ofone or more important links, but still re-tain practical control of the whole chainby means of controlling the most effici-ent form of the other links.
REFRACTORIES AND FURNACES.
In one sense, these two items overlap,and in another they are separate.Considering the refractories separatelyas refractories, we believe that they haveundoubtedly a two-fold value. Obviously,better refractories for furnaces, resultingin better conditioned and better control-led glass, will give better pack, and higherfeeder royalties.The patent cases on furnaces deal pri-Imarily with furnace design, batch feeding,and furnace handling. They are primarilyvaluable to us as supplemental protectionto feeder royalties, and are justified onsuch basis as well as constituting a con-trol in fields which may hereafter becomeimportant. Many of the cases are morethan merely secondary protection , as theyrelate as well to feeder forehearths.Examples of furnace cases which areapplicable to forehearths and thus areprotection to our feeders are (1) Amslercase 1853 on a particular type of con-tainer; and (2) the two Raeder cases 1896and 1897 applying to electric melting andconditioning of glass which obviously isas applicable to a forehearth as to afurnace.
PATENT APPLICATIONS 1927-1929
ANALYSIS
The following covers primarily our com-mercial devices and the new cases whichwere filed as protection of these devices:-(1) Feeders-including P. N.'s , Singlefeeders, Howard feeders, Tucker & Reevesfeeders, Miller feeders, and Bethel feeders.(2) Lehrs-including our combustionlehr and our new electric lehr.(3) Our mechanical stacker.Escalator buck.(4)(5) Shaping machines-including ourmilk bottle, twin press, press and blow,narrow neck, I. S., No. 12, and F. and H.(6) Refractories-including the varioustypes developed by Willetts.
DEFINITIONS
"Direct patent protection" means thosepatent applications which directly readupon or cover our devices , parts thereof, orproposed physical improvements thereon ."Indirect patent protection" of a device,includes those applications which preventthe use or improvements which preventpossible substitute for the device. This"indirect protection" seeks to block com-peting devices which would lessenincome.OurOf the 223 cases filed in the three years1927, 1928 and 1929, 200 are direct or in-direct protection to the devices mentionedabove; 88 applications being "direct pro-tection" and 112 "indirect protection ."The following chart shows these 200cases:-(1) Feeders(2) Lehrs(3) Stackers(4) Escalator Buck(5) Shaping Mach.(6) Refractories(1) Feeders(2) Lehrs(3) Stackers(4) Escalator Buck(5) Shaping Mach.(6) Refractories1927 1928Di- Indi- Di- Indi-rect rect rect rect99 7 167881 12512322272122040184922 326129192919TotalDi- Indi- Di- Indi-83rect rect rect rect11 48 27 7312 280246 51 0 323 2 132 0 11 0299061 88 112200125| ཙOf the 73 applications which have beencited as "indirect protection" of feeders,50 are directed to suction gathering ma-chines and are aimed at the developmentof the Knox-O'Neill machine, Owens,Hillman , Roirant, Etc.; 6 are directed tothe forced feed and down suction (Hart-ford process) developed by Rowe andLorenz, which method, if developed, or amodification thereof, might offer somecompetition in the future with our presentfeeders ; 6 are directed to possible im-provements in the "stream feed" and 4to other feeding methods. Two cases aredirected to electric feed, and the remain-ing 5 cases to possible modification of gobfeed.The remaining 23 cases may be classi-fied as follows :Electric Melting...Forming ware by rolling...Our new experimental tank .Rotary meltingShallow meltingSheet glass2 cases.1."13929991191939Tubing and Cane production 623There is no sound ground for criticismof the Patent Department in filing thecases which have been filed during 1927,1928, and 1929. Of course, some few ofthecases filled have turned out, and may here-after turn out, to be of less value thanwas expected . The reasons are two-fold.(1) The failure of a device, as the Hmachine, to make a prominent place inthe art, or the physical development ofthe art away from the particular inven-tion.(2) The practice which is sometimesfollowed in the Patent Department offiling "light" cases without going to theexpense of a complete preliminary inves-tigation of patentability. This policy isbelieved sound. It is as cheap to file theapplication as it is to make the completeinvestigation.GENERALThese examples all seem to leadto the conclusion that the only safething is to go to the limit in covering atonce all inventions that have a fair ap-pearance value, by patent applications, re-gardless of whether we can actually at
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that time figure any definite income re-turn therefrom .Hartford-Empire has very little "sellingexpense", as such item is ordinarilyknown . We spend very little on adver-tising and practically nothing on salesmenin this country.SUMMARY(1 ) Hartford, A Development Concern .Hartford-Empire is mainly a develop-ment and servicing company for the glassindustry. It has made its success by do-ing such work thoroughly and with a viewto the changing future .(2) A Changing Industry.The glass industry is rapidly changing,in equipment and in business conditions.A development status, effective now , willbe obsolete in a few years.(3) Suppose We Stopped Development .We could, indeed , stop development nowand perhaps pay larger dividends- for awhile. But in a few years Hartford wouldbe superseded by a more progressive con-cern, and our sources of income rapidlydwindle.(4) Effect On Our Licensees.Half the industry are our licensees.They dislike paying royalties . They wouldstop paying on any good excuse. Themain thing that holds them in line isthe prospect of our future developments.If we ceased to develop(a) We would , as stated above , lose in afew years the main sources of our income.(b) We would almost at once, be de-serted by many of our licensees. Thelarger combines would start their own de-velopment departments.(5) Patent Protection.Unless we thoroughly protect ourselvesby patents, we will be developing chieflyfor the benefit of others, and will reaplittle return ourselves.(6) Basis of Our Stock Value.Our stock is selling now at prices farbeyond its true value on its present re-turn . That high price is fixed by menfamiliar with the industry because theybelieve in our long distance policy , andthat that policy will secure for us thefuture.(7) Means of Keeping Our Position .To maintain that valuable position wemust develop and experiment in advance.The normal development period is threeyears. Unless our foresight covers at leastthat period, some one else who does willbe ready when we are not, and will takeour business.(8) Research.aThe "research department" is nowpart of large business where the "art" ischanging. For example. General ElectricCompany. Costs and profits are not theruling considerations in such departments.They are directed at an unknown future.The glass industry has an unknown fu-ture and we must meet it .Exhibit No. 126. Letter to R. H. Levisfrom William E. Levis, dated April 1 , 1935 .Printed on Page 250.Exhibit No. 127. Schedule of Owens-Il-linois Glass Co. payments to and receiptsfrom Hartford-Empire Co. Printed onPage 275.Exhibit No. 128. Letter from William E.Levis to F. Goodwin Smith, discussing li-cense applications on beverage bottles .Printed on Page 275.Exhibits Nos. 129, 130, 131 and 132. Let-ters from Owens-Illinois Glass Companyto Aubrey L. Romaine, Washington, D. C .;Mrs. Len Smith of Los Angeles, and theSparks Construction Company, New York,discusisng licenses on glass machines.Printed on Pagθs 263 and 264.Exhibit No. 133. Letter from William E.Levis, dated August 2 , 1932 , to R. H. Levisof Illinois-Glass Consolidated Corporation ,discussing stock sales and Investments inglass projects. Printed on Page 275.
(Exhibit No. 134)
Memorandum detailing expenses of patent litigation by the Hart-ford-Empire and Owens-IllinoisCompanies against competitors inthe glass industry for alleged in-fringements.April 12, 1930.Mr.Wm. E. Levis ,Status of Patent Infringement SuitsNow Pending .Suits Brought by Hartford on FeederPatentsFollowing the settlement arrived at be-tween Hartford , The Owens Bottle Com-pany, Tucker, Reeves & Beatty, and Wil-liam J. Miller , Hartford was able to geta number of applications out of interfer-ence and to issue patents upon them dur-ing the winter of 1925-26 , and immediatelythereafter (spring of 1926) suits werebrought by Hartford against Obear-Nester,Nivison-Weiskopf, Kearns-Gorsuch andthe Lamb Glass Company, as follows-
I ST. LOUIS SUITS
1. Hartford-Empire VS Obear-Nester(1st suit) , filed in the U. S. District Courtin St. Louis , April, 1928. This sult wasdecided by Judge Paris , October, 1938 , whoheld both patents valid and infringed , ex-cept as to the first ten claims ofthe Peilerpatent, which he found invalid becausefunctional . Appealed to the U. S. CircuitCourt of Appeals for the 8th Circuit , whichaffirmed the Lower Court in an opinionfiled February 2, 1930. Obear-Nester standenjoined from using the plunger feederwhich they formerly employed . Stops toextend the injunction to their air-vacuumfeeder are being considered (see below) .The patents sued upon in the abovecase were-Steimer No. 1,564,909 December 8. 1925Peiler No. 1,573,742 February 16 , 1926The Steimer patent relates only to plun-ger feeders . The Peiler patent listed isknown as the phase change patent, andmay apply to any gob feeder, whether ornot it employs a plunger .At the time this first Obear-Nester suitwas filed , defendant was using a plungerfeeder, but some months later changed toan air-vacuum pressure feeder without anyplunger-designed by Stuckey. When thesefacts developed , Hartford filed another suitagainst Obear-Nester, as follows-2. Hartford-Empire VS. Obear-Nester(2d suit) , filed in the U. S. District Court,St. Louis, February 25, 1929, charging in-fringement of the following-Peiler No. 1,405,936 February 7, 1922No. 1,662,436 March 13, 1928No. 1,662,437 March 13, 1928Ferngren No. 1,677,436 July 17, 1928Hartford's efforts to get a trial in thiscase have not as yet been successful.However the trial is now expected to takeplace early next fall .
II CINCINNATI SUITS
Hartford-Empire vs. Nivison-Weiskopf,filed in the U. S. District Court in Cin-cinnati, April , 1926 , charging infringe-ment of the same,two patents, to SteimerNo. 1,564,909, and Peiler No. 1,575,742, thatwere involved in the first Obear-Nestersuit in St. Louis . Later a supplementalbill was filed to bring in a third pat-ent-toPeller No. 1,589,304 June 15, 1926The single claim of this third patentrelates to the vertical adjustability of theshears with relation to the orifice.This Cincinnati suit (involving theabove three patents) was tried last Junebefore Judge Hickenlooper, who in Octo-ber, 1929 , filed an opinion in favor ofHartford on the Peiler phase change pat-ent, but finding the Steimer and thePeiler shear adjustment patent invalid .This decision has been appealed to theU. S. Circuit Court of Appeals for the 6thCircuit, and will probably be argued be-fore that court this spring.Judge Hickenlooper's decision on thePeller phase change patent was particu-larly noticeable in that he held the firstten claims of the patent valid and in-fringed, notwithstanding the decision ofJudge Faris in St. Louis (subsequentlyaffirmed by the St. Louis Court of Ap-peals) , followed by the decision of SpecialMaster Jones in the Columbus suits (seebelow) , finding these first ten claims in-valid as functional. It now remains forthe Court of Appeals at Cincinnati todecide, among other questions , whetherit will follow Judge Hickenlooper or theSt. Louis courts in respect to these claims.
III COLUMBUS SUITS
1. Hartford-Empire vs. Kearns Gorsuch,filed in the U. S. District Court in Colum-bus, May, 1926, charging infringement ofthe same patents , to Steimer No. 1,564,909,and Peiler No. 1,573,742, that were in-volved in the Pittsburgh and Cincinnatisuits.Subsequently a supplemental Bill ofComplaint was filed, adding two morepatents-Peiler No. 1,589,304 June 15, 1926Peiler No. 1,631,107 May 31, 1927The first of these is the patent on shearheight adjustment which was also intro-duced into the Cincinnati case, againstNivison-Weiskopf . The last mentionedpatent is what is known as the "Whit-tling" patent . It involves the shaping ofthe gob by adjusting the relative move-ments of the plunger and shears.2. Hartfor Empire VS. Lamb GlassCompany, filed in the U. S. District Courtin Columbus, charging infringement ofthe same patents , to Steimer No. 1,564,909,and Peiler No. 1,573,742 , and patents to-Soubier No. 1,574,709 February 23 , 1926Ferngren No. 1,574,739 February 23, 1926These patents relate to the revolving
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plunger. The Peiler "whittling" patent No. 1,631,107 was later introduced into the Lamb case also by a supplemental bill. Subsequently both of these Columbus suits were assigned to Hon. Berne Jones. as Special Master, to hear the evidence and report his findings to the Court, with recommendations as to the proper decree to be entered . After hearing the evidence , Master Jones, in May, 1929, handed down deci-sions in both of these Columbus cases.In both cases the Peiler phase changepatent No. 1,573,742, was found valid andinfringed, except as to the first ten claimswhich, following Judge Faris of St. Louis,were held invalid as functional.The Steimer patent No. 1,564,909 , andthe Peiler "whittling" patent No. 1,631,107were found not to be infringed by eitherthe Kearns-Gorsuch or the Lamb feeders.In the Kearns-Gorsuch suit, the Peilershear height adjustment patent No. 1 ,-589,304 was held limited and not in-fringed .In the Lamb case, the Soubier patentwas found valid and infringed . TheFerngren patent was found not to be in-fringed.Both sides filed exceptions to the Mas-ter's report, and after various delays im-posed by the Court, these exceptions wereargued before Judge Hough in Februaryof the present year. As yet he has nothanded down a decision on these argu-ments, and he has intimated his intentionnot to make any decision until after theCourt of Appeals at Cincinnati has de-cided the Kearns-Gorsuch case. Thiswould be unfortunate , but there is no wayof forcing the hand of a Federal Judgewho for any reason chooses to hold backhis decisions.Hartford's lawyers felt that Hazel -Atlasshould be held parties privy to theKearns-Gorsuch case, and bound by thedecision to be rendered as to the fourpatents involved in that case, but Hart-ford sought to attack H-A directly anddid so by a suit in Pittsburgh , listed be-low.3. Hartford-Empire VS. Lamb GlassCompany (2d suit) , filed in Columbuslast month, charging infringement ofPeiler patent No. 1,655,391 , dated January23, 1938 (see below) .
IV PITTSBURGH SUIT
Hartford-Empire vs. Hazel Atlas, filedin the U. S. District Court in Pittsburgh,in 1928, charging infringement of Peilerpatent No. 1,655,391, dated January 3,1928.We generally looked upon this Peilerpatent as Hartford's best bet. It wassupposed to broadly cover the use of aplunger in such a manner as to bringabout the shaping of the gob to fit theblank mold. The case was tried beforeJudge Gibson , and Hartford's lawyersseemed well satisfied with the recordmade up. They were greatly disappointedwhen Judge Gibson handed down his de-cision , in February of this year, findingthe claims of this Peiler patent so limitedas not to be infringed by the Hazel-Atlasfeeder.Hartford has taken its appeal of JudgeGibson's decision to the U. S. CircuitCourt of Appeals for the 3d Circuit , sit-ting in Philadelphia, and the appeal isexpected to come up for argument nextfall. Mr. Byrnes , the lawyer who arguedthe case for Hartford before Judge Gib-son, and who is regarded as the leadingpatent lawyer in the Pittsburgh districtand 3d Circuit, expressed himself as fairlyconfident that the decision of Judge Gib-son would be reversed.Our own feeling is that Mr. Byrnes isover optimistic in his view. While JudgeGibson's decision indicates a considerablymistaken attitude on his part, particu-larly as to the part played by Peiler inthe revolution of the industry broughtabout by the introduction of the gobfeeder, we deem his decision, taken as awhole, to be convincingly phrased anddifficult to upset. We would regard thechances of reversal no better than one tothree.
V. BUFFALO SUIT
Hartford's lawyers, still believing in themerits of the Peiler plunger patent , No.1,655,391 , dated January 3, 1928 , notwith-standing Judge Gibson's decision , recom-mended the filing of two additional suitsin other districts, charging infringementof this same patent. These suits in-Iclude the second Lamb case, already re-ferred to , filed during March of this yearin Columbus, and the suit of-Hartford-Empire vs. Reed Glass Com-pany, filed last month in the U. S. Dis-trict Court in Buffalo.If the trial of either of these suitsshould result in a decision materially dif-ferent from that rendered by Judge Gib-son, it is believed that the U. S. SupremeCourt will listen favorably to a writ ofcertiorari on conflicting decisions ren-dered on this patent.
SUITS AGAINST KNOX-O'NEILL
MACHINE
These include-1. Owens-Illinois VS. O'Neill MachineCompany and Frank O'Neill, filed lastNovember in the U. S. District Court inToledo, charging infringement of Soubierpatent No. 1,705,341 , dated March 12, 1929.An essential feature of this Soubierpatent, upon which the charge of in-fringement is based, is the transfer of theparison from the blank mold table to theblow mold table of a two-table formingmachine. At the time the suit wasO'Neill was making his transfer by theuse of a cam which caused the neck moldto travel with the blow mold about thecenter of the blow table during the trans-fer period, following the Soubier move-ment in this respect very closely.But in view of the charge of infringe-ment made in this suit, O'Neill changedthe form of his cam governing the travelof the neck mold during transfer, and thequestion of whether O'Neill's new trans-fer movement will infringe Soubier'sclaims, is much more serious. Howeverthe present case will be tried out onO'Neill's old construction , and Mr. C. B.Belknap expresses the opinion that wehave a fifty-fifty chance of winning onthis issue . He asserts , furthermore, thata favorable decision on this issue wouldbe helpful in forcing the patent againstO'Neill's new construction of transfercam .Defendant's answer in this case hasbeen filed, and Mr. Belknap will ask tohave the case set down for trial as soonas defendant's time fortaking depositionsunder the rule has expired. This willbe within a few days, and it is hoped tosecure a trial in June or the early fall,accordingly as the engagements of theCourt will permit.2. Hartford-Empire VS. Carr-Lowrey,filed last month in the U. S. DistrictCourt in Baltimore , charging infringe-ment of Cox patent No. 1,218,189 , datedJanuary 16, 1917. So far as we are ad-vised, the answer in this case has notyet been filed.
LITIGATION EXPENSES
As to all of Hartford's suits on feederpatents at St. Louis, Cincinnati, Colum-bus, Pittsburgh, and Buffalo-this com-pany is making material contributionstowards Hartford's expenses by way ofcredits against royalties coming to usfrom Hartford under feeder patent agree-ments.But the two suits against the O'Neillmachine, which being a suction machine,outside of "licensed inventions" as de-fined by our General License Agreementwith Hartford of 1924, are being broughtindependently by this company on theone hand, and by Hartford-Empire onthe other, without any division of ex-penses.
PATENT & LICENSE DEPARTMENT.
Henry W. Carter(Exhibits Nos. 135, 136, 137 and 138 willappear in following issue .)(Exhibit No. 139)(Received in evidence, Dec. 14. VerbatimRecord Page 265)Suction Inventions License Agree-ment between Hartford-EmpireCompany and Owens-IllinoisGlass Company.AGREEMENT made and entered intoas of the 1st day of July, 1932, betweenHartord-Empire Company, a corporationof Delaware, having its principal placeof business at Hartford , Connecticut(hereinafter called "Hartford") andOwens-Illinois Glass Company, a corpora-tion of Ohio, having its principal placeof business at Toledo, Ohio (hereinaftercalled "Owens-Illinois").WHEREAS, Owens-Illinois will, by thecancellation of its General License Agree-ment with Hartford dated April 9, 1924,surrender certain valuable rights, includ-ing the right to use certain feeder andforming machine units without royalty;NOW, THEREFORE, in considerationof such cancellation and the surrender ofsuch rights , and in further considerationofthe covenants hereinafter contained, itis hereby agreed between the parties asfollows:
SECTION I. DEFINITION.
The words"Suction Inventions" shall be defined asand held to include all of the followinginventions and/or assignable or divisibleinterests therein now owned or controlled,or hereafter and prior to January 3, 1945,owned, acquired or controlled by Hartfordin so far as the same are included in theinventions described below in this Sec-tion 1:Inventions of apparatus for or methodsof drawing glass by suction into molds,excluding, however, drawing glass by suc
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tion into a gathering cup (not a mold) and discharging the gather into a mold. Inventions of apparatus for or methods of forming glass by forming machines if and so far as such inventions are used or usable with, but only for use with , ap-paratus for and methods of drawing glassby suction into molds, excluding, how-ever drawing glass by suction intogathering cup (not a mold) and discharg-ing the gather into a mold.aInventions reiating to furnaces as suchand other apparatus, and not being func-tional parts of the gathering or formingprocess, shall not be included in SuctionInventions.SECTION 2. LICENSE AND RELEASEOF PRESENT OWENS-ILLINOIS MA-CHINES . Hartford hereby grants toOwens-Illinois, royalty free, a non-exclusive, non-assignable (except to thesuccessors to its entire glass manufacturing business) and non-divisible (except toits subsidiaries) License to use all ma-chines and apparatus involving SuctionInventions manufactured by or for Owens-Illinois prior to the date hereof and nowowned by it or by any of its subsidiaries(including the RM machine built forOwens-Illinois by the Taft-Pierce MachineCompany at Woonsocket , Rhode Island)and to make and use all reproductionsthereof whenever made. Hartford herebyreleases and discharges Owens-Illinoisand its subsidiaries from any and allclaims of infringement of its patents , nowor hereafter owned or acquired, on ac-count of the manufacture or use of anysuch machines and/or apparatus . Suchmachines and apparatus falling withintheterms of this section are described by let-ter designations or drawing numbers inSchedule A hereto attached.SECTION 3. HARTFORD'S OPTIONSTO OWENS-ILLINOIS . Before selling , orlicensing the use of, any Suction Inven-tions to anyone other than Owens-Illinois, Hartford shall offer to Owens-Illinois in writing the following three op-tions, with respect to one or more ofsuch Suction Inventions, and the UnitedStates patents issued and to be issuedthereon :(a) To take a non-exclusive licensethereunder;(b) To take an exclusive license there-under; or(c) To purchase such invention or in-ventions and the patent or patents issuedor to issue thereon.The time or times when such offer shallbe made and the invention or inventionsincluded therein shall be in the discre-tion of Hartford except as set forth inSection 9 hereof. In such offer Hartfordshall state the amount of consideration(royalty, and flat sum in full , or other-wise) it asks for an exclusive license andfor a non-exclusive license under such in-vention or inventions covered by suchoffer and the amount of the purchaseprice for such invention or inventions andpatents . Owens-Illinois shall, within threemonths after receiving such offer, notifyHartford in writing of its acceptance ofone of said options, or the release of itsoptions on such offered invention or in-ventions, or of its desire for arbitrationof the questions involved. If Owens-Illinois shall not so notify Hartford withinsuch three months, all of the said optionsshall be considered waived by Owens-Ill-inois as to the particular Suction Inventionso offered. If arbitration is desired byOwens-Illinois such arbitration shall pro-ceed with all reasonable dispatch. Owens-Illinois shall not be required to exerciseits option until agreement has been hadbetween it and Hartford as to the royaltyor entire sum to be paid for such non-exclusive license and for such exclusive li-cense and the sum to be paid for the pur-chase of such patents and/or inventions,or, failing such agreement, until suchroyalties and sums have been determinedby arbitration as hereinafter provided.Owens-Illinois shall, within ninety daysafter the award of the arbitration , notifyHartford in writing of the exercise or re-lease of such options.Section 4. Royalty and Conditions of Li-senses and Sales. Royalty shall be pay-able under any license hereafter grantedto Owens-Illinois pursuant to this Agree-ment with respect to any Suction Inven-tion only from the date upon which suchagreement is had, or from the date of theaward under such arbitration , determiningthe amount of the royalty and purchaseprice payable.Every non-exclusive license granted toOwens-Illinois hereafter pursuant to thisAgreement shall be non-divisible exceptthat Owens-Illinois may grant sub-licensesto one or more of its subsidiaries and shallhave the exclusive right to grant sub-licenses to Hazel-Atlas Glass Company, acorporation of West Virginia, and to itssubsidiaries, and to The Ball BrothersCompany, a corporation of Indiana , andto its subsidiaries ; but every exclusivelicense granted to Owens-Illinois hereafterpursuant to this Agreement shall be fullydivisible and assignable. Owens-Illinois,for the use of said Suction Inventions .byits said sub-licensees, shall pay to Hartfordroyalties at the same rate it is requiredto pay for its own use thereof.Every license granted to Owens-Illinoisby or pursuant to this Agreement shallextend to the expiration date of the latestexpiring patent on any Suction Inventionunder which such license is granted. Anysuch license under, or sale of, SunctionInventions shall be subject to Hartford'snow outstanding license agreements, asset forth in Schedule B hereto attachedand made a part hereof . In case of trans-fer to Owens-Illinois of title to any inven-tion which has utility other than as aSunction Invention, Hartford shall havean exclusive , assignable and divisible li-cense for such invention for uses otherthan as a Sunction Invention.Section 5. Damages and Other Rem-edies. In case Owens-Illinois does notpurchase or take a license under a Suc-tion Invention so offered , claims for dam-ages or for injunction or other remedy forinfringement thereof shall date from thedate of issue of the United States letterspatent thereon, or from the date of theaward of arbitration thereon, or from thedate when Owens-Illinois declines the of-fer of such Sunction Invention, whicheveris the later; and no such claims shall bemade with respect to a Sunction Inven-tion which is not offered as herein pro-vided .Section 6. United States Rights Only.The rights herein granted are for theUnited States of America only.Section 7. Arbitration. All matters forwhich arbitration is specifically providedforbythis Agreement or any dispute aris-ing out of or relating to this Agreementor as a result thereof, shall be settled byarbitration under the rules of the Ameri-can Arbitration Association and judgmentmay be entered on the award in any courthaving jurisdiction.The arbitrators in determining theamounts of royalty payable for an exclu-sive license and for a non-exclusive licenseunder, and for the purchase price of, saidpatents and/or inventions , shall consider,among other factors, the value of suchrights to Hartford, that is to say, theprobable amount that Hartford would beable to secure from another or others forsuch rights by sale or licensing.Section 8. Owens-Illinois' Credit Ac-count. By cancellation of the GeneralLicense Agreement between Hartford andOwens-Illinois dated April 9 , 1924 , Owens-Illinois will surrender the right to usecertain feeders and formers free of royalty,for which Owens-Illinois shall have acredit in the amount of Seven HundredFifty Thousand Dollars ($750,000) to applyagainst any above mentioned royaltiesand/or purchase price of Suction Inven-tion rights .If and when, from time to time, anyroyalty shall become due from Owens-Illinois, or from its subsidiaries or sub-licensees, under this Agreement, or anypurchase price of patent rights shall be-come due as above provided , the same mayat the option of Owens-Illinois be paid bycharge to such credit to the extent thatthe credit then exists ; the balance of suchroyalty or purchase price, if any, shall bepaid in cash, and the balance of suchcredit, if any, shall be usable for paymentof royalties and/or purchase price subse-quently falling due.Section 9. Time of Offer of Inventions.On or before February 1, 1945 , Hartfordshall offer to Owens-Illinois said optionswith respect to all Suction Inventionswhich have not theretofore been offered;provided that if the General LicenseAgreement between the parties dated asof July 1, 1932 , is terminated prior toJanuary 3, 1945, either as provided in Sec-tion 12 thereof or otherwise, Hartfordshall, within 30 days after such termina-tion, offer to Owens-Illinois said optionswith respect to all Suction Inventionsowned, acquired or controlled prior to suchtermination which have not theretoforebeen offered , and shall have no obligationto offer said options with respect to Suc-tion Inventions acquired subsequent tosuch termination . All the other provisionsof this Agreement shall remain in fullforce and effect. The purchases, licensesand royalty rights which shall vest, byreason of the exercise of options as pro-vided in Section 3 hereof, shall continuefor the full term of the patents involvedtherein.Section 10. Notification by Owens-Illi-nois. If at any time during the continu-ance in force of this Agreement Owens-Illinois shall be aware of any UnitedStates Patent issued to Hartford cover-ing any Suction Invention which Owens-Illinois is then using or desires to use, it
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shall then notify Hartford of such use or desire. IN WITNESS WHEREOF, the parties hereto have hereunto set their hands and seals, acting herein by their respective officers duly authorized therefor. HARTFORD-EMPIRE COMPANY. By T. GOODWIN SMITH, President. Attest : ARTHUR T. SAFFORD, JR. , Secretary. OWENS-ILLINOIS GLASS COMPANY, ByWM.LEWIS. Attest : LLOYD T. WIL-LIAMS , Secretary.SCHEDULE ATo be attached to Suction InventionsLicense Agreement between Hartford-Em-pire Company and Owens-Illinois GlassCompany, dated July 1 , 1932, called for bySection 2 thereof, it being, however, rec-ognized that while generally inclusive , thisschedule is not necessarily a complete re-cital of all machines and apparatus towhich the license and release provided forin this section may be applicable.List of Owens Suction MachinesA-First commercial machine-deliver-ing bottles on left side of machine-6 arms-1905.AC-Improved "A" machine-6 arms-1908.AD "AC" type machine with ten armsinstead of six-1909.AE "AC" type machine-improved typewith more cooling air-6 arms-1909.AL-Old Type-"AC" type machine forgallon bottles-6 arms-1911.AL New Type-Similar to "AT" ma-chine-8 arms- 1918 .AN-Dip head machine for prescriptionbottles-10 arms-1912.AP-Dip head gathering machine trans-ferring the gather to an adjacent pressingmachine for making tumblers-10 arms-1913.AQ-Fifteen arm machine similar to"AR"-1914.AR-Dip head machine for quart andpint bottles (an "AN" machine makinglarger ware)-10 arms-1912.AT-Raising bottom plate type-formaking carboys-6 arms-1917.AU-Gathering machine similar to "AP"type (but not dip head) used in connec-tion with the making of fish globes, candyjars, etc.-6 arms-1913.AV-Fifteen arm machine similar to"AN"-1917.CA-Multiple moldmachine-partingline of the blank molds tangential insteadof radial- 10 arms-1923.OA-Single table four mold rotary ma-chine with traveling neck rings-1928-9.OB-Single table six mold rotary ma-chine with circle of blank molds surround-ing circle of finishing molds at same level-1928-9.RM-Non-revolving ram type machine-1932. A closed packing case containingcomplete blueprints of this machine, bear-ing dates prior to 7-1-1932, has, by mutualconsent, been placed in the custody ofMr. W. J. Belknap, Detroit, with the un-derstanding that this box is not to beopened except in case of controversy withregard to this agreement and schedule.Approved :HARTFORD-EMPIRE COMPANY.By ARTHUR T. SAFFORD, Jr.,Secretary.OWENS-ILLINOIS GLASS COMPANY.By HENRY W. CARTER ,Vice-President.SCHEDULE BAnnexed to Suction Inventions LicenseAgreement between Hartford-EmpireCompany and Owens-Illinois Glass Com-pany, dated July 1, 1932.
OUTSTANDING LICENSE AGREE-MENTS OF HARTFORD1. Crning Glass Works of Corning, NewYork, by virtue of an agreement dated October 6, 1922, has exclusive rights forthe following articles of ware:
(a) Bulbs and tubing and cane all whenfor use in the manufacture ofincandescentelectric lamps or for any other perma-nently sealed enclosure for electrical pur-poses.
(b) Signal and optical ware.
(c) Ware intended and adapted for usewhere its heat resistance , physical strengthor chemical resistance or electrical prop-erties in such ware is of substantial value,and made from glass having a linear co-efficient of thermal expansion of less than.000006 per degree Centigrade, or contain-ing more than five per cent. boric oxide,or having a higher electric strength orhigher thermal endurance or higherchemical resistance than a glass contain-ing 80% silica , 10% sodium oxide, 5%boric oxide and 5% calcium oxide .
(d) Ware intended and adapted forholding food in the process of cookingor sterilizing, other than ware intendedand adapted for packages for storage andsale of goods or for transportation ofgoods .
(e) Drawn tube and cane.Further, said Corning Glass Works hasnon-exclusive rights for the following ar-ticles of ware:
(a) Articles of glass which are espe-cially adapted by reason of form or com-position for electrical purposes.
(b) Laboratory and art ware.(c) Paste-mold ware.2. American Thermos Bottle Companyof Norwich, Conn., by virtue of an agree-ment dated December 22 , 1931 , and let-ters dated April 9, 1932 , and April 11,1932, has exclusive rights for glass vac-uum bottle when used for Division A ofthe glass vacuum bottle field, and non-exclusive rights for glass vacuum bottleswhen used for Division B of the glassvacuum bottle field. The term "glassvacuum bottles," as herein used, shallconsist of any bottles, jars, jugs , and/orcarafes containing or consisting of a glassfiller constructed of an inner cylinderenclosed within an outer cylinder witha substantial vacuum between the twocylinders. Said bottles, jars, jugs and/orcarafes shall be designed and adapted tokeep the contents thereof hot for notmore than forty-eight (48) hours, andcold for not more than one hundredtwenty (120) hours. The term "glassvacuum bottle field" as hereinabove usedshall include the use of said vacuum bot-tles, as above defined, for the followingpurposes: 1. Division A: For lunch kits,for factory, office and school uses; pic-nic containers, traveling and campinguses ; office and home jug sets andcarafes ; 2. Division B: For holding anddispensing ice creams , frozen foods,frozen confections of all kinds, softdrinks, chilled and hot liquids, and thelike; for use in the laboratory for holdingliquid air, carbon dioxide, serums and thelike.3. The O'Neill Machine Company ofToledo, Ohio, by an agreement dated Feb-ruary 23, 1931 , holds (1) a non-exclusive,non-transferrable license under claims 1and 2 of the Cox Letters Patent No.1,212,189 , together with the right to sub-license its customers under the saidclaims; (2) a release from any and allclaims which Hartford may have againstsaid O'Neill , or against its licensees orcustomers, arising from the manufacture,use, or sale by O'Neill or by O'Neill's cus-tomers or licensees, prior to Febraury 23,1931, of any subject-matter covered bytheclaims ofthe said Cox patent No. 1,212,189;(3) the license rights acquired by saidO'Neill under said agreement extend onlyto the particular claims recited above anddo not include any other claims of anypatents theretofore or thereafter issuedto or acquired by Hartford or O'Neill, ex-cept that the license rights granted byHartford to O'Neill under said agreementextend to any claim of any Uinted Statespatent owned by Hartford, which claimreads upon, and would be infringed by, thestructure shown in said Cox patent whenused as described in said Cox patent. LEFT OFF PAGE 348 [not finished]