In Re Amtorg Trading Corporation

BUFFINGTON, WOOLLEY, Before THOMPSON, Judges. Circuit PER CURIAM. bankruptcy facts in this pertinent by the court and stated' found case were Supp. 850): “It is (7 F. follows below as agreements under the to us that clear occupied space in which these claimants Kline’s Kline, Store, Department held the merely agent position trustee moneys owing for collection of due and goods depart- credit by sold on the several agreements plainly state, ments. so provide separate for a account these money items of bankrupt- collected. After cy intervened, the order of the referee kept trustee separate

the receiver and ac- Carter, Milburn, Ledyard & New Mason, City Randolph Henry

York Williams, (L. D. Wayne Jackson, and G. all of City, appel- counsel), New York lees. GRAHAM, Judge, Presiding Before BLAND, HATFIELD, GARRETT,

and LENROOT, Judges. and Associate GARRETT, Judge. Associate appeal findings This from is an of the United States Tar- recommendations proceeding iff Commission in a had provisions tribunal under the of of section 337 the Tariff Act of 1930 USCA § 1337).1 By the terms of the statute this court is limited to a consideration of “a questions only.” of law apatite, The material involved phosphatic mineral from which there is produced phosphoric acid used the man- apatite ufacture of fertilizer. The Russia, issue was mined in Northern country. from Phosphoric produced acid is from both phosphate apatite. In order to fit the acid, producing minerals for use in separated, mined, must be after the unusable substances which surround them. The method of separation said now general to be in use the United States BLAND, Judge, dissenting. Associate known proc- as the flotation ess. appears corporation by that a name Separation

of Minerals North American Corporation (not party proceeding) to this pat- owner of certain is the States United defining processes. flotation Among ents 1,547,732, these No. July issued 28, 1925, Broadbridge to Walter and Edwin Edser, assignors, entitled “Production of Material,” 1,795,- Fertilizer No. 3, 1931, issued March to William Trot- Wilkinson, Wray assignors, ter and Eltoft entitled “Flotation Concentration of Phos- phate-Bearing brevity, For Material.” to, will be hereinafter referred these spectively, re- Broadbridge patent as the patent. Trotter Rublee, Burling, patentees Covington, Acheson It is conceded that & Shorb, Washington, (J. Harry D. from the C. Union Soviet So- Marshall, Republics (hereinafter Newell El- referred to as Covington, W. cialist John Maxwell, lison, preceding govern- Russian Russia) Alan C. all of Wash- C., counsel), appellant. ington, D. ment. pertinent por- F.(2d) full of In For text ease re Orion section, (Customs) —, footnote in A. T. D. see C. C. P. 47123. tions corporation rial appears that a with which it is earth found It further Process, Recovery Corporation Phosphate means Flotation Phosphate known as the in- which holds' exclusive license covered 1,547,732, corporation, patents 1,795,100 1,780,022, patents; volved another separation nonex- and Cyanamid Company, is a phosphate by the * ** sublicensee, said that still anoth- United and Chemical Industries clusive Agricultural utilizes the invention corporation, er International described and claimed * * * in said Corporation, patents, licensee sub- while not a and such acts licensee, Phos- constitute has contracts under methods unfair of and Corporation concentrates acts phate Recovery in the ar- phosphates for ticles into by byit the involved the United and their States sale owner, processes. importer, the consignee and their agents." (Italics ours.) initiated proceedings The instant quotation comprehends italicized by the three before the Tariff Commission regard what principal we as the re- issue with corporations, hereinafter last-named which this court need joint complaint concern itself. as appellees, ferred to by alleged them being filed appellant here, Amtorg Trading in unfair acts and Corporation (hereinafter referred as in importation and the United sale .the Amtorg), par seems to have made rock, apatite* im- phosphate States of ty to proceedings the the before Tariff Com ported from Russia. mission because of the fact it was the actual' imported vendor the material In in is- view the manner which the Phosphate Standard Wholesale & Acid lim- sues to be reviewed this court are Works; Amtorg having purchased it from appeal, ited in in particularly and the organization. the Russian Amtorg2 ais argument us, before not deeme'd es- it is corporation organized under the laws proper sential or to set with de- forth York, the state of New in and it's answer gree particularity allegations all the complaint states, to the in this case inter responses thereto in the contained several “Amtorg alia: engaged, now amended, since pleadings, passed upon by finally as which were organization in has been engaged Commission, nor Tariff purchase in the ed of commodities in the is a Unit full statement of all the Commission’s shipment States for to the Union of So findings upon phases all controver- Republics viet (hereinafter Socialist called sy necessary. Union), purchase Soviet and in the of com sufficient, purposes It seems for the importa modities in tion Soviet Union consideration, our corpora- state sale in into and the United States.” known Standard Wholesale Phos- The Tariff found Commission as a fact phate Works, Inc., Baltimore, Acid processes that the flotation used in Russia Md., alleged purchased to have from separating apatite involved from “United Chemical Industries” of Russia substances surrounding unusable it were 25,000 some phosphate rock, tons of processes the same respectively in- 7,000 which some alleged tons were to patent to Broadbridge volved in the and in port Baltimore, en route to and that patent. 2 11 of the claims Tr.otter said Industries, United Chemical 3 quote ¿11 complaint, from the “separate authority cited the Commission phosphate mined them finding mate- for its here under review is its own 2 12), recognizes For a somewhat detailed discussion of the line legal authority Amtorg, represented character status court, Amtorg Trading Corp. Graphophone see (D. C.) v. Gimbel Bros. States, F.(2d) v. United 71 21 C. cited, C. F. and eases therein (Customs) 532, A. P. T. D. 46975. effect vendor according patent process to a is not To the end that the Commission’s view- point patentee may infringer liable to the words, be stated in as an its own quote following remedy in such cases from its decision: “Respondents [Amtorg] the manufacturer. But contend that it should be borne importation and sale in of articles mind that the' case of manufacture ques- patentee accordance claims the United States has a infringement proceed against remedy; tion do not he can constitute the do- thereby manufacturer, stopping and are not unfair com- therefore mestic petition. part report As was said evil at its source. But in ease of man- (pp. the President on Bakelite abroad of articles the ufacture method for are, fact, proc- operations refer proceeding with Russia finding in a prior bakelite, respective patentees which esses of the as found ence majority of approved by Commission, finding was the Tariff but it is con- Frischer & that, court in the case purely questibn ceded since this is al., Inc., al., Corporation et Bakelite et upon of fact which the Commission has (Customs) C. P. A. (2d) 39 F. 17 C. substantial, finding made a based even review this T. D. certiorari controverted, evidence, that issue deniéd having been court’s decision one which this court now consider. harmony Such concession is in with this Co., Inc., al., v. Bake et case of Frischer & holdings court’s cases above several al., lite Commission et U. S. cited. L. Ed. 755. S. Ct. argument appel- The entire behalf point, recite pertinent, at It is respecting lant what above stated we have promulgation subsequent to the that be, principal predicated up- the issue to is statement, findings, rec- Commission’s patents on the fact that the which in- are case, which instant in the ommendations volved process, product, patents. are not January of date promulgation was pointed It is out that in the Frischer & pass upon has had occasion this court Cases, supra, Co. et al. and Orion Co. appealed also questions in two cases kindred patent questions actually as were control- In These are re Orion tribunal. from that ling solely and, product patents, related (Cus- 22 C. P. A. F.(2d) C. 71 concerned, so far as the instant case is —-, In re North- T. D. toms) urged is not the al., decisions in those F.(2d) Pigment Co. et ern -, cases, T. D. 47124. in so far as (Customs) product related to C. C. P. A. along the Frischer & with patents, These decisions he overruled. by Reconsideration Case, hereinafter more supra, will be Co. principles this court of the announced in fully- discussed. only those cases is here asked to the ex- tent observations there by appellant may in the made is not admitted bearing upon a process patents. processes in the case that the used instant producing predicated upon importation or sale in is the which United States; remedy patentees prescribed domestic cannot States, by United against foreign through the statute is specifically reach manufacturers the im- against ported courts. If the con- and not of the Federal merchandise process manufacturer or should respondents adopted, tention of be The value of vendor. process would patent seriously remediless. be patentees impaired domestic be may articles domestic manufacturers manufactured in say To abroad accord- rights ance with patents process under could protect acquired imported bo against in and sold domestic manufacturers United States other without con- travening foreign manufac- not section 337. vendors but enacting repugnant “In importers turers is both to section 316 of Tariff Section Act of 1922 [19 [19 law and USOA USOA § 174-ISO] reason. §§ all unfair section 1337] denounces as unlawful the Tariff Act 1930 the (where in methods or unfair acts did effect competition require- met) ments of tendency substantially the section have the are what, stat- injure page ed in respondents’ in the Unit- brief destroy or 97 et seq., sec- was not by If of that done provisions amendment to the pat- ed States. injury legislation, ent laws. invoked and As result of that applied, tion be not patentees industries domestic destruction have a remedy, to or injunction damages or protection and safe- under up patent built under patent- guarded competition laws, entry from unfair domestic exclusion of im- through importations. products in ported effected with accordance process patents. feels that section 337 was finding such results. “The Commission reaffirms prevent intended investigation gives clearly to American the Bakelite pro- “The law right into the competition to fair United States of ar- ducers goods. Patentees or their abroad in produced of their ticles accordance with sale process to such described a United licensees are entitled States pat- or sale thereof im- Any markets of the United States. ent the. the owner, consignee, agent or unfairly interferes is an porter, either, method act of competition within the terms of the unfair method or unfair act therewith comes meaning imported products. within the respect statute intent section or act method 337.” Existence that section respect the Northern 337 of the Tariff Act With is, substance, differ- Case, however, 19 USCA (which the situation § in- same one of the as section In case 316 of the Tariff Act of ent.. process patent; (19 purely 174-180), volved was a USCA under which §§ process and both Frischer & Co. arose), other contained remedial; sustained solely there claims. We that it has in nowise en- to the larged Tariff Commission holdings grant rights the substantive laws; into the United infringe- effect that that there was no manufac- pigments patents by from Canada ment of the the use of the .States pat- Russia; by processes, process, tured and that the section does not States, but for which ented in clothe the United the President of the United States patents, and patentees Commission, held no Canadian acting the Tariff when here, brought the transaction thereunder, sale of any authority arbitrarily same purview act, of section 337 within the to declare an which does fall with- 1337), and of 1930 USCA category Tariff Act described meth- “Unfair by the President justified the issuance ods importation acts in the embargo. order the United States into articles the United judicially States” as such acts deter- any distinc- possible to draw It is not courts, minable of under settled rules tion, principle, between law, such an act as authorizes the Northern in the claims involved embargo provid- issuance of the order of bar, and, Case, .supra, at and the case Co. ed the section. respect applied with if the doctrine there to to, is con- by ap- be adhered claims appellant quotes The brief on behalf recognized trolling here. This is opinion from the pellant, to reconsid- and so we. are asked the United case Federal light er of numerous al., Trade et Commission v. Gratz 253 U. arguments based thereon authorities and 427, 421, 572, 575, S. S. Ct. 64 L. Ed. presented hearing which were not of 993, as follows: “The words ‘unfair meth- former issue. competition’ od of are not defined duty, pres- deem it our We meaning and their is in statute exact dis- made, give and care- courts, entation here to full pute. It is for the not the commis- question. of said The sion, ful re-examination ultimately to determine as matter of whom, sense, upon peculiar there courts they They clearly law what include. are final for the establishment must be reliance inapplicable practices never heretofore legal principles, and maintenance of correct opposed regarded good as morals be- not, not, hesitate, and should when con- do by deception, faith, caus'e characterized bad error, vinced that have fallen into to fraud, oppression, against public or or as decisions reverse their own and announce policy dangerous tendency because of their principles the more mature consideration lead them to which fuller information and unduly competition to hinder or mo- create certainly nopoly. The act was not intend- are sound and correct. conclude fetter free ed to and fair as In Barden v. Railroad commonly practiced by Northern Pacific understood and hon- 1030, opponents (Italics U. S. S. Ct. in trade.” ours.) orable Field, speaking L. Ed. Mr. Justice foregoing quoted As we construe the court, discussing for the after certain cases it is for language, while the courts ultimate- opinions, he had which written the some determine, law, ly as a matter what the expressions urged of which were to be in competition” method of words “unfair in- being expressed conflict with views in clude, jurisdiction within the “ * * * decided, being then case said: initially pass Trade Commission Federal important It is more that the court should particular upon whether a method of com- upon right later and more elaborate con- was, law, unfair; matter of petition as a sideration of the cases than consistent with necessary. particular is not that it previous declarations. Those doctrines act, method, practice or must have only eventually will stand which bear by the courts to be unfair declared before examination, strictest and the test of ex- properly could find the Commission perience.” method, unfair, act, practice but, to be unfair, appellant general contentions in behalf of it must fall within the to be upon particular phase practices regarded “heretofore contro domain as are, versy now under discussion effect, good morals because character- opposed faith, fraud, op purely administrative, by deception, bad ized and that the acts upon public policy because pression, embargo pred- or as order unduly hin dangerous tendency icated are in of their such acts as are unfair with- judicial monopoly.” This meaning der or create of the terms used comprehensive. language urged is broad and statute. It is then field, processes “due use in large do the words Russia covers a Unit- discrimination,” law,” ed States “unjust entirely involved was law- ful, method like. The words “unfair the act of it- competition” may self there include acts which element or incident un- ; specifically the fairness open- have never been declared ly Trade and in entire courts to be unfair. Federal Com accordance laws Bro., Keppel appertaining mission & 291 U. S. such transactions. Ed. Federal S. Ct. 78 L. It is say but fair to this court to that in in Co., 283 Trade Commission v. Raladam U. named, no one of three cases above S. 75 L. 79 A. S. Ct. Ed. pass which we have been called 1191; Sears, L. R. Roebuck & v. Fed upon recommendations of the Tariff Com- (C. A.) eral Trade Commission C. 258 F. mission, has the construction of the statute 307, 6 A. L. R. 358. presented here advanced been is now cases, presented, nor supplied by how- have we been In each the above-cited prior ever, litigants practices found to be with the authorities appellant presented general domain of has caused to be unfair fell within the here. we think practices suggested in the Gratz Such will be evident from a read- ing supra. minority opin- In of Federal Trade both the case Bro., supra, ions in those Keppel it was cases. Commission v. & practice to be un- said of the declared there Upon the given consideration the issue “ * * * prac- fair : It is clear that the presentation made, under the here we feel is of the sort which the common law tice and theory constrained to hold that the now ad- long statutes have deemed con- criminal sound, correctly is vanced and that it sets trary public policy.” section, meaning forth the true of the theory proceed under that we to an exam- of Federal Trade Commis- In the case ination of the supra, whether as matter the Commis- a Raladam sion v. law the acts holding found the Tariff Com- in its that cer- sion was reversed of performed, mission to have been such find- meth- there involved were “unfair tain acts findings of ings being binding up- fact and competition.” of ods us, were acts which the ex- authorize Sears, Roebuck & In the case Co. merchandise, clusion as the Com- Commission,supra, a cer- v. Federal Trade mission recommends. advertising misrepresentation in tain held to be an unfair tion, quite simple. competi- facts are Merchan- method of patented, dise not itself manufactured in selling held that the but it was also process patented in by appellant Russia a the Unit- below merchandise certain States, Russia, import- ed not in competi- but method of cost not an unfair into, of, ed and entered the accompanied by commerce tion, misrepresenta- unless United States. sale. tion in connection with such brought to our atten- case has No pat The owner of a valid United States any, holding tion, nor have found Commission protected in ent is its exclusive use may legally Federal Trade States, “throughout the United and the Ter practice act or method declare an ritories thereof.” USCA 40.§ judicially determined courts have which the not to be an unfair tice, follows, therefore, It that the courts will method, act, prac- or or protect pat- the owner a United States nor we found case infringement any- against an ent thereof method, act, practice to be unfair where in the United States and its terri- tories, general do- not come within the that did brought proper is where suit competition sug- methods main of unfair jurisdiction. protection But the which the quoted language hereinbefore gested is laws United States afford limited Case, supra. from the Gratz territory named in the statute. In the interpretation appellant’s Compa- To state of Dowagiac Manufacturing our case ny upon question, position Company, it is that the v. Minnesota Moline Plow 221, 398, acts the President and the Tariff Com- 35 Ct. S. S. L. Ed. U. “ * * * mission authorized section said: parts is a case analogous our law to the material by a-patent under right conferred Cases, supra.- its terri- Frischer and Orion States to the United confined ** * infringement tories indicated, already the use As has been wholly acts predicated fight cannot entirely legiti- in Russia'was country.” foreign done in a mate, patentees held no Russian since the reversed, patents. Elec- the situation Were are Bullock pertinent cases Other patents say, patentees Russian Electric is to held Westinghouse Mfg. Co. v. tric & 105; proc- for the Victor but not United States F. A.) 129 (C. C. Mfg. & only, patentees have no ex- C.) 171 éss (C. v.Co. Strauss Talking Mach. right & clusive to use same United Screw 673; Manhattan v. F. Rushmore protected C.) F. States could (C. Stamping Works Flow.) of the United States. Duchesne, courts under laws S. 60 U. v. Brown Ed. 595. 15 L. appellant The brief filed on behalf quite interesting legislative contains certain pat of a the owner true that It is also history respect proposal country, hav but by foreign granted ent a bill introduced protect is not patent, States ing no United Thirty- at a session States Senate our laws ed the United By terms of said bill Congress. Second patent. foreign letters his importa- illegal the proposed to make it was tion into the United States product product between of a The distinction quite gen pat- product process, is clear and or a process patents patent machine, product had provided the defendant erally upon ented understood. article; discovered was in a knowledge manufacture an invented mak country. The bill was nearby adjoining a method process patent is Senators, happens infrequently and seems ing discussed various an article. patent subsequent invention Con- letters in the same to have been introduced into law. the article was never enacted recognized gresses, both Globe, it, well-set making Congressional but it is the Citations method pro 1549-1551,1566-1573, pp. Cong. of law 1st. tled rule 32 and 2d Sess. Sess. product, and that a only pp. 534—536. tects process. protects House 2d Sess. 540. uct or both 24 L. Ed. 139. 48 Ct. and a a ditional authorities materials product. Cochrane ticle) sale of process is a method preme Court who the infringement of apatite and to importer had ent is concerned. Perkins Glue ess, perfect so far as the sale of a In Holland Furniture S. process itself not necessarily Thus a In the uses the product patent is not is not apatite. The Russian product itself not right to sell and the American decisions case process patent is not any question produce said: patented. Hence there is no Company, process which it should, resell it in the United a The embrace patentable. product perfect right Had there been a bar, will be cited v. “ * * * description of treatment of certain a of being patented. Deener, L. particular 277 U. S. the other. Either course, of Ed. infringed apatite (the ar nounced being patented, * * a Company exporter had tection afforded process 94 a by process pat of one does later. have here C. patentable U. S. infringed the result or 245, 255, buy ”* States, made, prod proc Ad 780, one Su- a courts with by selling Stat. that a 94 U. S. Act portance to examine the decisions posed Act see, also, in the directed thereto ing Co. depends stantially changed granted § 40). A.) 10 No Since that the act of v. Union May of 198,201, instant legislation of the nature of April patents, upon processes by process patents, which extent by the 1852 has uniformly have been to the effect 119); 23, Act of respect F. product. 24 Ed. Commission’s for a case rests the Rev. St. 10, 1790, Incandescent L. 131; Act These by process patents. statute, constituted since such was July statutes, ever extent of to the extent by any process defined importing July National 235; 4, Stat. § been enacted Merrill solely upon § it becomes of 4884) 1836, 8, 1870, has not been sub (11 recommendation Welsbach law in the United 376, Light apatite, made patent rights the act de v. Phonograph § amended Stat. specifically ^[5] (5 Yeomans, infringed § fixed Co. its USCA of the by the Light 109) Stat. find pro pro im (C. (16 by by ; resultant, 388; infringed by the of un- sale C.) (C. Co. F. v. Lambert Co. held, effect, patented product, it was Gimbel Co. v. Graphophone 361; Kryiak infringement there had been no dis- C.) 234 F. (D. Brothers tricts where the were instituted. F.(2d) suits 25C.) (D. Bottle Co. Owens Copper Consolidated v. Nevada Barton case appellant The brief for cites the authority No 86. (2d) F. (D. C.) Oursler, 53 S. of Hurn v. 289 U. S. in the sev cited has been holding otherwise comment 77 L. Ed. Ct. case, nor have we in this filed briefs eral that the de to the effect that it is believed re of own result our found as a of therein con cision clusively disposes Court searches. question now un der discussion here. are- cited above cases The two. latter their of because importance brought, here the al suit was In that case further jurisdiction material, upon here legation, in so far as pat- process protection copyright, (2) respect infringement to the (1) the competition, upon a claim based ents. Hour,” play “The be certain called Evil Code By provisions Judicial by petitioners, copyrighted longing to and brought for suits 28 USCA § infringement - plain pirated by Both had been defendant. required to be patents are same citizens tiff and defendant were district judicial in either the brought state. inhabitant, or an defendant Supreme- was-pointed defendant has the- It out district in which infringement. infringement claim and that both act an committed upon rested claim Case, defend- supra, the Kryiak In the single right, to alleged of a violation corpora- ant, Company, Bottle was Owens wit, copy right protection established a of the state of Ohio. said, play. The court inter alia: righted Illinois, there in the state of sales office “ * * * alleges violation alleged unpatented bottles The bill "sold certain pro right to namely, for which single right; And it is copyrighted play. The man- Kryiak, patent. held plaintiff, tection however, bottles, cause did not which constitutes ufacture this violation Indeed, infringe of Illinois place judicial district the claims take of action. precisely brought, in other so where the suit ment and unfair more little brought by plaintiff in the facts as states. identical Suit rest epithets to equivalent of Illinois the sales were of different district made, where than the group the two circum alleging infringement of the same characterize sought is an patent, being process primary relief of his both claims stances. injunction essentially court, holding put that the sale end to an claims. differently infringe wrong, however charac single- did not wrongs ju- terized, enjoin con patent, the bill for “want of not to distinct dismissed applied independent causes principle stituting A basis for risdiction.” in similar stated, applicable rule is a-citizen the Barton where of action. cited, in S. S. brought Baltimore California suit- Southern and authorities 316, 47 Ct. Phillips, of York Maine cor- 274 U. S. district New a Co. S. ‘A of action poration alleging infringement of L. Ed. 1069. cause facts,’ this court there patent. that the manufac- found does not consist S., 47 Ct. turing process not carried on in the 321 of 274 U. S. (page said 602), district, unp’at- only York sales of the of the unlawful violation New ented ‘but there, product being the show. number right the court facts “ * * * case, alleged not es saying: variety of the facts do dismissed the This and one cause of action so proper not for this more than district the venue tablish result, they be con long suit.” as their whether combination, severally or in is the sidered foregoing In both the cases it seems right single legal one of but violation the defendants have were, conceded * * * merely “The facts are wrong. fact, unpatent- manufacturing means, They end. do not and not the respective patented proc- ed articles action, they but the cause show constitute esses, but not in the districts where sued. ’ appear.” by making wrong existence unpatented prod- There sales tested, and, infringement the claims of place, had taken the estab- “Thus ucts competition averred process patent doctrine that of unfair lished 83á separate process claims, involved erroneous. complaint are present bill of any expressions as- We also of ad- action, grounds withdraw different but causes serted in judication ap- relating process patents of ac- cause of the same support pearing Co. in the Frischer and Orion tion.” Cases, supra. that since accordingly held The court However, nothing reason herein contained jurisdiction federal existed modify- involved, revoking or al- should be construed as there was copyright being ing, any respect, rendered the decisions of the jurisdiction so federal product patents of the with reference competition,'in so far as use Cases, concerned, supra. The although Frischer and Co. Orion play was copyrighted state, distinction between patents of the same parties citizens were by the the Dis- and the remedies afforded held that since and it was further infringe- finding upon protection against for their law in its Court was correct trict the merits that infringe- ment so well defined so known no and well there had been here enter disposed unnecessary that it is deemed this also copyright, ment upon any respect thereto. com- discussion with question of unfair of the interrelated to the the same related petition in so far as have suggestions If some of the play. copyrighted during of this been offered consideration phase of the analogy between logical case carried to their conclu recited, Case, has been supra, which Hurn sion, the im seem to follow that case, particular phase of the instant portation the cost merchandise discussion, prin- in so far as the now under importer lower than which price concerned, quite seems ciple applicable is pay for similar or he would have to Case,' supra, the In the Hurn complete. competitive produced in the United article solely upon the parties rested rights of the method an unfair States would constitute statutes; case the in the instant copyright sec competition purview within the solely upon the rest rights parties of the 337, supra. might* Such a. transaction Incidentally may be re- patent statutes. by. par interested regarded be ty, as unfair up- rest themselves the statutes marked that obviously Congress never- intended paragraph of the Constitution on the same operation of such should fall within the of the States. section. wherein, if the see unable to We are reaching In here an- the conclusion competition fell with question of unfair nounced, given due attention to infringe- been no there had finding that by appellees sev- cited authorities Hurn laws in the copyright ment of filed, legislative his- eral briefs held that not also be supra, it must tory to which directed attention. methods “unfair part A history was recited us merchandise importation” acts in the Case, supra, in the Orion as follows: determined, as it is when

here involved fall being incorpo- be, infringement section 316 was “When that there was it must (19 since, the Tariff Act of 1922 the rated into processes, 174-180), the Finance found, methods and USCA alleged unfair §§ facts Senate Committee, reporting to the Sen- proc- solely the use of such bill related acts ate, language incorporated illuminating esses. embargo provision purposes as of that section: unless must be Such purpose it was finds that court Congress “ relating meth- provision ‘The to unfair enacting section 337 of the Tar- ods 1337) to broad- of 1930 USCA iff Act every type enough prevent goods is broad patent rights, of substantive en field is, practice and there- and form of unfair process patents extend- rights in and create fore, adequate protection to Amer- more any point to which the beyond ing far any anti-dumping stat- than ican gone construing heretofore courts country (Senate has ever had. Re- ute patent statutes. 595, Cong. p. 67th 2nd port No. Ses- of consideration Mature sion.)’ did to the conclusion leads us not do this. being time H. R. 2667 was con- Hence, that our “At we conclude sidered, States Tariff Commis- the United Pigment Co. in the Northern decision Ways and the attention pro- called sion than statute went further to the difficulties had that, Means Committee vides, as said decision in so far foreign of sections from the administration countries. In this latter class cases, of this of products, produced 317 of the Tariff Act manufactured foreign suggestion: country producer where the “ beyond is the control of of the courts ‘Importance of Commission’s Jurisdic- States, United imported into this coun- Infringements Patent try. Up “ until the time when are re- law, apart ‘Existing from section leased from custody customs into the com- inadequate protect domestic wholly is to merce of country, opportunity of their from violation owners presented to the manufacturer of the Unit- importation patent rights through protect ed against States himself unfair infring- infringing Such sale of articles. competition methods of acts. Aft- imported may he and are ing articles er goods have been so released into throughout large quantities and distributed country, commerce the American pat- The owner of a United States. manufacturer rights assert against his ent, himself, protect is confront- seeking to possession of, one who sells, has necessity proceeding ed with the goods. However, this method of con- or retailers. The re- individual wholesalers be, is, trol ineffective, must because of imposes im- sulting multiplicity of suits the multiplicity of suits which must neces- importation possible Stoppage of burden. sarily be instituted to rights enforce the infringing through an order of articles the domestic phase manufacturer. This entry only from is the effectual exclusion obviously the matter was in the minds of the remedy. jurisdiction of district courts Congress at the preparation time of the scope decree issued them said section 337.” importation do or exclu- not extend It is foregoing sup- our view that imported entry from sion of merchandise ports the conclusion here reached into States. there- as to the United Section process patents. fore, Tariff as construed Commis- findings sion in before the Court now There are other contentions on behalf review, Appeals affords an Customs appellant, but, in view of our conclusion remedy. Supp. (Vol. to Tariff exclusive upon the already issue discussed, Reports Readjustment on Tariff Bill of deemed unnecessary pass upon them. 1929, page 10667.)’ would, however, We ap- observe that pears that, obvious “Thereafter, even under the reported the committee Com- theory, mission’s House, the recommendation part, based follows: “ the Trotter should have been only change ‘The the sec- only confined to thereof, claims 2 and 11 existing tion over is the elimination law these patent, claims of this provision which authorized the Pres- of which was found to have impose ident to such additional duties not been used in Russia. per in excess of 50 cent or less than 10 The finding of the per Tariff import- of the value of the article cent that, upon ed facts found in violation the section as would off- it, apatite employed. set the method or involved act constituted unfair provision committee feels that this should and unfair acts in the reason be retained that the im- purview articles within the position penalty section 337 duties offset viola- of the Tariff Act of entirely inadequate prevent 1337) tions is USCA fur- is reversed. remedy ther violations. effective entry exclude the articles concerned Reversed. (Report, Ways in the violation. and Means 2667, Rept. Com. on H. R. No. 71st Con- BLAND, Judge Associate (dissenting). Session, gress, p. 1st. 166.)’” respectfully I must dissent from the con- preceding the Our comment above re- clusion reached reasoning employed cital was as follows: “It will be borne in by my associates. The case is of such vast many mind that of the decisions cited in importance, respects which I will later Case, supra, here, the Frischer out, point compelled that I feel explain, prevent rendered under intended statutes length, why at some I think the decision is unfair methods of in the in- wholly unsound. country. of ternal commerce Much appears prevention reason for more (a), of. Section 337 Tariff Act of practices such in of importations the case (a), USCA reads: industry, substantially injure or etc.” import an in practices 337. “See. Unfair bar, importa- In the in case at the unfair act trade. tion, country as of well as the sale in this de- competition /'(a) Unfair imported, the article so is involved. of com- methods clared Unfair unlawful. majority opinion present The in its form importation petition unfair acts accept many States, in does not of the contentions or their of articles into the United so, consignee, appellant properly or made of owner, importer, sale necessary ap- tendency since was not to hold with either, or ¿gent the effect of substantially injure pellant these contentions order to ar- destroy or which is op- rive at ma- efficiently economically the conclusion reached industry, an Now, jority. States, prevent if I the real basis erated, understand or majority opinion, or of decision in industry, an such the establishment that there com- unfair method com- monopolize or trade and restrain to merce in the United States, petition importation or act -in the hereby de- involved, apatite the or-sale of the shown unlawful, and when found clared with, bar, record at reason that the be dealt to exist shall President law, competition and act com- provisions other as unfair addition plained gen- provided.” does “fall within hereinafter of practices regard- domain 'heretofore eral state, briefly possi- as as I first to wish opposed good as morals because char- éd major- ble, my understanding of what faith, or deception, bad fraud acterized by rea- holds, expressed ity opinion public oppression, policy or be- holding. prompt such a sons which tendency unduly dangerous of their cause things in number There are a ” competition monopoly.’ to hinder or create recited have been opinion need not “ ** * majority opinion The It states: form it present emphasized, in its or urged is then in Russia of the use court’s of this the correctness does reaffirm processes of the United States in- Inc., al., et in Frischer & conclusion lawful, entirely that in the volved was al., F.(2d) Corporation et Bakelite importation act of itself there no ele- (Customs) P. A. C.C. unfairness, importa- or ment incident of 43964; Co., 71 F.(2d). D. In re Orion T. openly tion and in entire ac- -, (Customs) T. D. A. C. C. P. appertaining cordance with the laws to such Northern In re transactions.” 447, 22 al., (Cus A. C. C. P. 71 —, et F.(2d) -“the majority then holds that the- in so far as those toms) T. D. ory [by appellant] now advanced th¿t importa suggested or cases held ” * * * sound. article, patented country into this of a tion importer, or mere seems to me that the fact regardless of the intent clear prompt importation of motives that at bar was made motives lack meth importation, (leaving constituted unfair with law section 337 ed the accordance supra, in im (a), consideration), and unfair acts out of ods justification anything openly, holding is no portation, but-that said importation related to the did not an decisions which that such constitute court’s lawfully majority manufac holds that importation of án article unfair act. article, country by process importation although foreign in a tured pat leaving (a) (again section 337 out patent, which lawful of American here, open, protected consideration) was withdrawn is an unfair ent could be holds, Leaving It also either the statute bar out' decisions. act. from such consideration, inference, importa import it was lawful expressly or lawfully although country made abroad sale article an article of an tion stopped infringement patented machine had in an might suit. upon an product of a same status the patent. to me far-fetched to hold It seems to be that, because the sale of a infringe- held (a), process cannot be to be an It will be noticed that section ment, necessarily might that it things declared unlaw- follows there are two competi- an unfair method of methods not constitute (1) ful: Unfair act '(in importation) an unfair and unfair acts in the ticles; ar- or “in sale the own- an article. (2) their er, either, importer, agent reaching broacl and far consignee, or so (cid:127)the that, bring my judgment, tendency destroy is to it will about the effect

83? opinion need- sug- of purpose the much the of complete nullification the gesting remem- Congress It in- must be did not intend legislation ed involved. to acts in clude obviously unfair as an act in importation other bered that unfair the aimed the relating patents, to of of an American importation, patent necessarily process, as provision, distinguished will also pat- the at articles, they ented certainly the rule which is laid down fall far short fall under of doing so. majority. explanation purpose In the of use Congress was not content to section Act of (19 Tariff in Federal USCA expression it used same 1337), speaks the Tariff Commission of 717 et § Act Stat. Trade Commission “infringements” and suits C., certain seq. 41 et 15 USCA seq., title U. S. § report dealers. The compe House Com- seq.), “unfair et Ways speaks mittee on and Means of sought to which “vio- tition.” It also reach acts report evidently lations.” The followed interpretation did with by strict not fall suggestions of the Tariff Commission. The and it “un phrase, in used the term quoted information furnished the Tar- im of fair methods [in iff Commission was not furnished importa to acts in the portation] unfair Congress first used which the controverted term ever Neither articles.” term enactment, now bar. same language any legislative in used before used in the Act of Tariff and in term has ever been defined and neither quoted statement the Commission, ac- except this one. It is any unthinkable court cording to the opinion (quoted intended do ma what the from In re effect, Orion 71 F.(2d) in do. It says, it intended to jority -, C. C. (Customs) P. A. T. 47123), D. give intend to surely did not an additional the Commission was explaining the neces- already remedy remedy to those who had a sity provision in the Tariff any Act of 1930 deny remedy great majority similar to the one the Tariff Act of holders affected who no ex had but which embargo enforced remedy isting whatever. levying alone higher instead It duties. report part That the Senate calls attention Tariff Commission’s Finance, quoted Committee the ma- section, construction of the which construc- jority, provision states under con- tion it stated then involved in appeal an enough “is broad prevent sideration ev- to appeal court. That referred to was ery type and practice and form of unfair Case, Frischer and in the therefore, is, adequate protection a more Case, Frischer Commission had Tariff any anti-dumping American than definitely held the importation into this country (Ital- has ever statute had.” country an article (bakelite) made The term mine.) practice” ics “unfair is abroad, in accordance one, broader a broad than similar term an was an patent, method except bar, used in statute the one at competition and an act the im- one courts have not been portation finding an article. See 11No. upon called construe or In my define. of the Tariff Commission in the Frischer Congress, by judgment, section intend- attempt get Case. No was made to Con- bring ed to about the same or more far- gress, in the Tariff Act to narrow results, in reaching the field of internation- discussion, provision now under commerce, accomplished by than were al was in the Act of 1922. Tariff So it is clear Trade the Federal inAct spoke that when Tariff Commission field of domestic trade. “infringements” and the spoke committee products is well known that “violations,” they could not have had processes and machines constitute involving the mind a matter tenuous conten- majority of our great internal inter- appellant, tions because of the Commis- goods national commerce which are dealt holding definite contrary. sion’s At legisla- restrictions. The most, the very terms “infringements” history majority opinion cited tive legislative history and “violations” strongly indicates it was regarded one indicating could not be even purposes of the enactment to afford ad- Tariff more than the Commission’s inter- effective remedy safeguard ditional and pretation (contrary dependent upon patents. industries Case, supra, This contrary Frischer to its majority concedes. If quotations later, holding, Northern Pigment legislative history from the majority Company supra) of the meaning '838 unnecessary point in both en- that the reason out language found which was it is unfair in er is in one the oth- Surely, Commission case'and actments. the Tariff product did not that in Congress patented the case of a broadly. used those terms patent rights (even patentee being of the warranted use them at all. 'Are we violated, while any unpatent- sense control- in the case if this matter were product patent ed rights patentee of the assuming Tariff Commis- ling) in Committee, are not speaking violated/’ sion’and the House in the two involved of the two sections acts, Appellant importation of states that the than the precision more spoke with patented product rights a the violates in its written employed had Commission patentee, importation while the review, court em- or this findings on then unpatented product pat- does not -violate in the Frischer expressions ployed in its rights. this ent The answer to contention withdraws), and in later (which it now Case very simple. pat- is importation application of involving the cases decided anybody’s ented does not violate ? the sections is, every sense, patent rights, and law- ful, unless made unlawful act under concluded, majority has con- I as the If consideration. cluded, not intend that did that Congress country of an ar- into process importation thi's absolutely jus- It is follows that there upon a machine by a ticle distinguishing between article tification patents patent by an American protected appel- patents, prohibited, if such im- country might be admissions, argument, lant’s frank in oral the article tended the sale of portation to case, support amply in this this view. industry, I destroy would be an American a term in- competition” was “Unfair also that never to the conclusion forced (26 Anti-Trust Act the Sherman volved that' matters kind intended 1-7, 209, 15, title U. S. C. Stat. [15 §§ coming within regarded as be should 1-7, Clayton note]) USCA §§ underlying real This is the all. section 730, 15, 12 seq. et Act Stat. title U. § counsel, was disclosed appellant’s view seq.]), 12 et C. USCA S. [15 If I concluded argument here. oral at the by the meaning had defined courts. concluded, I be majority has would as the Congress passed then Trade Federal conclusion reached agree with the forced act, supra, containing the new Commission opinion in his author competition”. term “unfair methods of Case,‘su- opinion Frischer dissenting acts, Concerning the said three he, clearly pointing after out pra, in which in Co., Federal Trade conclusion, said: many for his “I reasons 643, 283 U. Raladam S. 316, where, to find in section am unable 590, L. Ed. 51 S. Ct. ha”s Congress ever any other act which A. L. R. said: do purpose to evidenced passed, it wgs bill the foundation of “The which reason, and, I that, can- for that thing as a not act, Senate, passed de- first majority that agree with competition’ to be unlawful. ‘unfair clared Debate in mind had it enacting the section sponsors apparently convinced should dealt patent infringements alleged words, legislation that these I had intend- it. feel that with ed law, meaning at common a well settled had this, way, provision, in some do the bill came from too narrow. When assuring a definite and have been Houses, the two these between conference upon any question of finding

legal been eliminated and the had words words validity raised.” competition’ substituted. ‘unfair phrase Undoubtedly The unsoundness conclusion has a the substituted majority and the much meaning, reached untenable but how broader broader is, appellant’s argument belongs I to that not been determined. has character think, following illustrated found in does not phrases admit of class “Appellees argue, definition, reply meaning ap- brief: appellant’s precise sale page which must arrived at plication product is an unfair method has this Court elsewhere what called.‘the judicial why do not see inclusion and competition,- gradual then ’ Orleans, unpatented v. New of an Davidson sale exclusion. the product, by process pat- 24 L. Ed. 616. produced abroad S.U. here, determination an unfair one for final likewise meth- ented competition. and not of the Fed- are certain it courts Commission. od of We Gratz, complained acts here S. regard- eral Comm. v. U. should be Trade ed as Federal meaning Ed. unfair acts 64 L. within S. Ct. Co., supra, provisions 257 the (and, controverted Trade Comm. v. Beech-Nut I see as it, this 441, 453, only question is L. the page necessary U. S. 42 S. Ct. 150 [66 decision 307, here), and reviewing Ed. 19 A. L. R. that 882]. Commission’s we should “hesitate authority to the Commission “The reject to Commission, the conclusion of the proceed, body if there has that believes that upon based clear, specific as it is and com- being method is used unfair prehensive findings supported by evidence.” commerce, qual- then Federal Trade Keppel Commission v. & require- ified in conference the further Bro., 291 304, 427, 423, U. S. 54 Ct. 78 S. ment, bill, original not in it —‘and L. Ed. 814. pro- appear shall to the that a commission respect ceeding by to it thereof would I desire to call attention to and brief- By public.’ of the these ad- interest ly discuss the following cases: Federal words, protection in- public ditional Trade Bro., Commission Keppel v. & su- paramount importance, terest is made pra; Sears, Roebuck & Co. v. Federal but, nevertheless, they are not substantive 307, (C. Trade Commission A.)C. 258 F. jurisdiction, complementary words of 358; 6 A. L. R. Federal Trade Commis- jurisdiction upon words of limitation Co., 483, sion v. Hosiery Winsted 258 U. S. immediately pre- language conferred 384, 42 Ct. S. 66 L. Ed. Trade Federal up- ceding. is Thus Commission called Algoma Co., Commission v. Lumber 291 U. determine, necessary pre- on first 67, to as 315, 320, 54 S. S. Ct. 78 L. Ed. 655. requisite complaint, to the issue of a wheth- case, In the Supreme first Court given er there is reason to believe that a had, phase case, as one re- what I person, partnership, corporation has been gard as question, principle, the same using competi- or is method of unfair e., here, us i. Did which confronts the Fed- commerce; and, deter- right Trade have the eral Commission affirmative, mined in Commission initially determine what constituted an “un- proceed, ap- still it unless further competition?” ex- fair method of After pear proceeding that a be to the in- would plaining Congress, by the use of public, terest and that such interest phrase more “broader and flexible ‘unfair specific and substantial. Federal Trade ” competition’ than methods of meant more Klesner, Comm. v. U. S. S. had to aim at the acts which been defined 1, 138, 74 L. Ed. 68 A. L. R. 838. Un- Ct. competition,” by the courts “unfair as per fair trade methods are not unfair se said: court competition. ex- the last [Note “While’this Court has declared pression.]” prac for the to determine what courts pointed The court there out that Con- or methods of tices are to gress the use of the term additional unfair, Trade deemed Federal Comm’n v. “methods something of” meant more than Gratz, 421, 572, supra U. S. S. Ct. [253 had similar terms acts, meant the other two passing on that 993], 64 L. Ed. proceeded give meaning is of the determination term. weight. It was crfeated with avowed It is well-settled law that we should hold purpose lodging the administrative func Congress, broad, new, when it used the body specially tions committed it in ‘a language uninterpreted in the contro- competent with to deal them reason provision, verted meant more than did information, experience study and careful use of similar but narrower terms in and economic of the business conditions prior enactments. The whol- has affected,’ organized and it was ly failed to observe compelling this most manner, respect length with in such a requirement. reasoning and result of expiration of the terms office of its opinion opposite lead to the conclusion. members, ‘give oppor to them an language tunity expertness prior acquire dealing While the used in the en- to, questions including special referred these in concerning actments Federal Act, dustry experience.’ Trade Commission in no that comes sense as Re language port used -in of Senate Committee on broad the statute Interstate bar, 13, holdings Commerce, I think the No. at 63d June Sess., courts, pp. Cong., and other 2d 11. federal See hereinaft- Federal cited, compel the conclusion that Comm’n v. Beech-Nut Packing er the Trade general 257 U. Ct. condemning S. S. declaration 882; compare practices, 66 L. A. Ed. L. R. leave it the commission to de- R. Co. Interstate Com termine practices Illinois Central what were unfair. Comm’n, 441, 454, 27 merce S. concluded U. S. latter course would be better, were the point reason, Ct. 51 L. Ed. 1128. for the as stated one If it, more representatives we should than think of the Illinois Man- doubtful reject Association, hesitate to conclusion ufacturers’ that there too clear, Commission, spe many practices define, based as it is and after supported comprehensive findings writing 20 of them into the law would be cific by quite possible evidence. to invent others.” ' See, also, Federal Trade v. Commission “We hold correct- that the Commission Packing Beech-Nut 257 42 U. S. ly an practice concluded that the un- was S. Ct. 66 L. Ed. L. R. 882. A. fair competition method of the within meaning unnecessary is the to-day statute. The Federal Trade Commission to attempt comprehensive a definition subdivides the unfair acts of banned, unfair if methods which are even into sixteen subdivisions. possible it do do not inti- to so. We case, except as is It is conceded this not author- mate the does either that statute indicated, that the hereinbefore hitherto prohibition ize other and article, made here patented if a which or, on the methods of unknown or if patent, an American infringe would hand, may pro- other the Commission that prevented, sold here be is an unfair could competitive practice every hibit unethical im- is whether the act and that this true particular character or regardless of its otherwise, porter openly it or and that did practices consequences. New different true, importer not it is if the did even know they light arise in the must considered as be by patent protected the article they em- are the circumstances which that, country. majority agree this The will ployed.” (Italics mine.) igno- notwithstanding his innocence and rance, unfairly, holds that he has acted or different” acts in im- When '“new product imported the of an American if he of merchandise come befo're portation time process patent knowing at with the Tariff accordance Commission permitted he not country statute, duty to whether it is its determine it, knowing that to manufacture constitute “unfair not destroy industry, American practice would importa- competition or in the unfair acts re in In Northern Co. as was true then, This court will tion of articles.” al., supra, has committed an et he not un- law, upon, determine a if called matter it is for one fair act. The reason unfair such acts such as are whether patented protected import to article by the statute. unlawful puts an American is because suggested Congress It has been holder of American at an un- prod- importation of the had intended destroys industry disadvantage fair have to constitut- uct preserve, seeking Congress act, specifical- ed an it would have unfair exactly importer apply to the same reasons imprac- ly The provided so act. process pat- of an American inadvisability ticability making ent. part Congress is attempt clear- sus- full of cases which books are Sears, ly & explained in Roebuck Trade the Federal Com- tain attempt quote and I will not supra, methods were unfair mission that certain Moreover, Supreme opinion. from that language used Fed- under new subject-matter in Fed- Court discussed Act which could Trade eral Commission Keppel Bro., v. & Commission eral Trade held to be unfair not have report cited and referred law. or under common prior statute on Interstate Com- Committee Senate new under the lan- or is not isWhat unfair reported merce, it when it the Fed- depend largely upon what must guage used Commission bill the Senate. eral Trade accomplish by leg- sought to Congress part, as follows: report, “The islation. gave careful consideration committee Trade Commission attempt In Federal question as to whether it would Klesner, S. S. Ct. 74 L. many prac- U. and variable unfair define L. R. definitely 68 A. prevail in commerce and to Ed. tices for- Trade would, held that the Federal bid their whether continuance S., Ct. page enforc- 217 of 288 U. 53 S. a means Act was not intended as say pro- L. Ed. 706. But we cannot ing private rights. So it with jurisdiction only to con- Commission’s extends bar; private rights are visions at types practices happen those welfare cerned. The existence and litigated para- have been before this Court. given- are to importance. mount history language “Neither nor the intend- suggests the act hold holds To ed fixed the forbidden methods to confine constitute complained of here acts do unyielding categories. The common used, language acts under the new competi- law afforded definition of held not heretofore because the courts have and, tion before the Fed- enactment such, unquestionably out them to be eral Trade Commission Act USCA [see oth- line with numerous Act (15 Sherman Anti-Trust §§ 41-51] decisions, of which er federal some court 1-7, note) inhibi- USCA had laid its §§ I hereinbefore cited discussed. or mo- combinations to restrain Trade Let take the facts in Federal us nopolize interstate commerce which Bro., supra. Keppel Commission v. & had construed to restraints courts include candy- Keppel firm was one of numerous upon competition in interstate commerce. sold manufacturers who manufactured not been have feat of a difficult pack- as “break take” what was known draftsmanship opera- to have restricted the ages, penny packages in some of which tion of the Trade Commission Act to those placed, purchasing child competition in interstate com- particular would, therefore, get his package are forbidden merce which at common law candy free. The Court likely grow or into violations no de- held that there was Act, if the Sherman had been the fraud, ceit and that there was no legislation.” purpose thing candy other dealers could the same do Fraud, deception, wrongdo- intentional themselves, protect that notwith- but therefrom, ing, damage flowing or need not standing these un- facts amounted an shown, be even under the narrower Fed- fair method of the new practice, eral Trade Commission which re- in the language used Federal Trade Com- competition. lates Federal Trade very question mission Act. On Algoma Co., supra; Commission v. here, Lumber controlling is one the court said: Trade Federal Commission v. Winsted “Although the method of Co., Hosiery supra. Algoma In Lum- adopted by respondent children, too induces Case, supra, pine ber Co. where California young capable of exercising be an intel- pine was sold as gen- white the trade ligent transaction, judgment pur- erally pine understood that California point chase article less desirable in regular pine, not the white it was said: quality quantity than that offered at a “The comparable price finding no pack- straight goods age, animating may respondents motives take it that not it does involve any deception. choice the contested fraud name. The re- It would seem spondents say competing it was chosen distinguish also that can manufacturers variety yellow pine their adopt from any break and take device the harder time yellow pines native to competitive posi- their and thus maintain southern states- premises respondent may tion. From these We assume this is so. The ar- fact however, remains, gues practice pines beyond reach not botanically commercially, the Commission because it does not fall white either though opportunity of the classes may within which this for confusion comparatively subject pro- slight has held to the Commission’s have when the hibition. Federal restricted to See Trade Comm’n sales were customers in v. local Gratz, 421, 427, 572, markets, buying for consumption. 253 U. S. 40 S. Ct. 64 home 993; L. Ed. Federal Complaints, any, Trade Comm’n there were v. must have Co., Packing 441, 453, Beech-Nut 257 been few and inarticulate U. S. at a time when supervisory 66 L. Ed. body S. Ct. 19 A. L. R. there was to hold busi- 882; duty. Federal Trade Comm’n According v. Raladam ness to to the law as Co., adjudged, many competitive U. S. practices S. Ct. 75 then L. Ed. 79 A. L. today may suppressed R. (Federal Federal Royal Co., Trade Comm’n v. Milling Hosiery Trade Comm’n Winsted su- dam wrongs, part, duct on goods, his pra), were not actionable but is because of age- complainants the Amer unfairness which classified as, l American ican remote. wil collateral and suffer as result often (C. Mfg. Amtorg Saginaw manufacturing something in Rus Washboard Co. v. here, 609. sia selling 50 L. R. A. A.) C. 103 F. which it could * * (Italics mine.) manufacture here and sell. * “Competition may be unfair within Court, Surely, Supreme' what scope within meaning; of this statute and cases, these said reference to the ef- .discretionary powers conferred-on .of fect of the addition “methods of the term Commission, practice con though the Act, of” in the Federal Trade Commission to fraud as under does not amount demned applies with lan- much more force to the there is a stood Indeed law. guage courts here under The term consideration. long fraud, equity have kind of as courts used (a), 19 ÚSCA 1337 section perceived, clinging a benefit which broad, (a) only unusually is in product.of misrepresentation, however legislative a field of endeavor never before Hurd, innocently Redgrave v. L. made. proceeding entered. This is in the nature 12, 13; R. 20 Rawlins v. Wick Ch. D. against property (in rem) an action ham, 304, 317; Hammond v. C. & De J. distinguished equity actions Pennock, is the N. Y. 152. That personam. cited cases which were actions respondents’ plight to-day, no matter what In light Keppel Bro. su- & their motives been when pra, discussed, and the other cases can there They began. must extricate themselves reasonable as to doubt what Su- by purging from it their business methods preme Court would have held if it had been capacity to deceive.” called to decide the Northern ¡it in So, any difference not make does Case, Company supra, or the at bar? case importer had the case at bar whether upon I will not dwell a discussion anything knowingly which knowledge-or did is, Amtorg Trading Corporation who is con- conduct alone was when his unfair operates government how it for the Soviet presented: Does Is sidered, but things Russia. All those are matters result in an un- .importation so made pretty generally which are understood and which industry to the American fairness little, any, bearing if on the have real is- Congress-sought protect? sues here involved. It is admitted in this v. Win Trade Commission In Federal case, concerned, so far as we are that respondent sold supra, the Hosiery sted etc., phosphates, apatite, in are made Rus- .term jobbers, used thé and and to retailers sia, processes in accordance with the n applied which to underwear “merino”' involved, patents American if one and that wool; job not all The retailer was produce attempted goods the same The not deceived.. ber understood and processes country, own- the same this in intend,.to any deceive manufacturer, not did. ers, siop or licensees could one, yet, and and deceive not did one, production infringement; such as an that existing the consideration account largely, complained of have the effect or acts was that ase manufacturer in de¡- the c tendency substantially injuring retailer and putting hands stroying an which is into ef- American them to which enabled a matter the jobber unfairly economically ficiently operated; and and . sales, own it was their increase phosphate rock from Russia that was presented situation whole that the held ton, delivered at Baltimore which $6 competition. average ton $1.57 below cost of method unfair port Hosiery phosphate is strict rock delivered at that Co. Case The Winsted bar. The in the- mines in Florida. of the com- issues at Some ly point in on the plainants lessees of the (and is not importer it owners claimed nocent case) patents necessarily pay high and importer is innocent instant their, leases, competitors .royalties under fact puts into hands unduly handicaps away pro- -such American take their hlone appellees instrument to unfairly competi- by underselling into but ducers when thrown not only trade them merchandise, processes it is the same tion with truthfully stating that royalty expenditure. fair is made the same without Is it that it and n American; industry remedy provided re- process as appellees. tie permit importa- bar is not and the free straints then" thestatute at in product,, produced by same unfair con- tion of the an individual because them, would at and one who did not know process, the circumstances same holding required bar, indus- also be the same destroy make and thus ar- in im- in cases like the Frischer where act try? precisely, More fair pur- company ticle claims were foreign-controlled involved. portation for a by the pose industry by im- of the law would be evaded destroy an American pur- goods do so transfer of to so-called innocent portation not sale when it could chasers, be perjury and fraud would sale here? legally by manufacture But, of this con- legal- encouraged. regardless Since the Court holds said, sideration, or ever candy, no has ever ly penny piece of one selling a with a complained of in the say, will that the acts deceit, meth- is an without fraud unfair not Pigment Company Case were Northern trade, why od competition in should in importers or that the court not sustain the Tariff Commission fact unfair no had purchasers case were innocent who complained of were holding that the acts knowledge pigment made. of how the methods apatite? acts in the holding opinion complained the acts of here and in the that it is conced- be remembered must Pigment Company so, Northern Case were case, properly ed in this proposition seems to rest parties, majority, unfair that decided cases hold that súch acts- Pigment the Northern Com- here pertinent constitute unfairness. It is sound, the deci- it controls pany Case cited, to note that there is no decision case, sion in this facts cited,, I am sure that there can be none in the Northern case and the facts which holds that acts such as the one at bar distinguished Company Case cannot is, therefore, are not unfair and that there fact, Notwithstanding this principle. authority supporting a lack of for the ma- suggested that the record at bar jority opinion. does an extreme case of not show such in the Northern as was shown however, unfairness opinion, In the attention is case, Pigment Company Case. In that appellant called to the fact that in its brief had been was shown that Americans who points out that in 1852a bill was introduced pigment engaged the manufacture in the United States Senate States, employed by and a com- illegal importation of the have pany operating under the American product patented process prod- a quit employment their and went to near- machine, patented uct and that the bill by they operate Canada where could un- Senators, was discussed various but was royalty, paying der the without enacted into law. The then never they that there manufactured and caused points legislation out that of similar shipped country pigments be this to which character has ever since been enacted into price wholly could be sold at such a as to law. industry if destroy such un- resorting Because of the unusualness in there held were continued. fair acts ,We proper kind of matter to this as consid country importation into this that case, eration in decision of a and be made, so fell within the term used pigments, apparent immateriality, of its I cause If this was true in the in said section 337. examined the cited references and others Case, Company where Northern relating thereto with some care. a bill Such damaged they knowingly the American in- Senate, and, introduced in the was in ex if dustry, it must also be an unfair act it, plaining patentee it said that the was goods, produced, so importer of the did not lasts, making machine for wooden shoe produced. In know how other largely England, then in used New be-1 was words, Congress not could have distin- ing deprived of his reward importers guished who between knew the Canada, nearby, of such. and those who did not. The facts effect patented lasts made in Canada on the ma industry same, upon the American was the An chine. amendment was offered to con and, regardless knowledge of the prohibition imported fine the arti importer, Congress made of cles to those wood. This was dis sought protect would suffer the rejected. passed same cussed and bill disadvantages in either day instance. If February, on the 8th Senate 1853. I were, bar, in like the one required cases find no record of the bill ever re House, make distinction between importer ported an that since term facts relating processes March, who knew all the adjourned on the 3d of Sáá why the unpatented it is not difficult understand simulation foreign manufacturers In view the measure did not become a law. and untrade-marked American

n at, many produced inter particular packages aimed mat- evil and articles is a happened ter of vening gravest could have in our interna- circumstances concern passage of tional to-day. which would have rendered the commerce Under the any unnecessary. majority, the law But stretch would it be unfair for an innocent imagination purchaser buy it can be concluded an attractive Congress deliberately against package Japan, decided in which simulated an prevention package, law American general policy knowing not what kind patent America, of a packages in similar were sold machine, it is dif import ed process, .country it into this ? Could why that would throw practice stopped ports ficult to understand under sec- at the question as to light judge whatever tion Not if we 337? the un- pro it Congress, when enacted whether vision under fairness of the im- mental attitude consideration, did did porter. certainly itBut would be unfair author producer intend that the ity used should be goods term to the American of similar prevention of importations'such for the permit practice, I think such a it clearly bar. provision. are at within intent of by the ma- is said Notwithstanding what opin- Let this court’s suppose, us after consid- jority down, to this court’s with reference in ion case is handed eration, cases, prior differences should issue an Federal Trade claims article between claims de- Company, to Amtorg .order here, an ex- as affects issue the- on the apatite at bar selling sist North- brief in the appellant’s amination of ern term ory within the that it was embraced Case, supra, Pigment Company dis- competition.” In “unfair methods definitely pointed that it there closes cases, if the unfair- light of the above infringe- remedy^was out that a afforded consideration, is there ness was the in- ment where" article claims were suits hold and would doubt to what proc- which was not afforded where If is unfair justified holding? volved be to sell it by ess were involved. is true that the claims stopped not be (although could there, authorities cited here were not cited because the sale infringement action point and "that case, stressed infringe anything), would it also does not ques- like it is case at bar. mind import keep it Let unfair to ? us was, however, argued before and de- Amer- protect the sought to Congress industry cided the Tariff Commission by stopping such transactions ican appeal supra, and on here Frischer it entry mul- thus avoid port of at.the brief, and appellant’s discussed attempts with and vain tiplicity of actions the instant cited in of the authorities some inadequate remedies. there cited. case were opinion says: "If some appellant been presented which have here The issue offered suggestions car- case were during It been before this court of this new. has consideration not conclusion, logical it would in the Northern Frischer ried their- Case that, any importation of Obviously, it was Company to follow Case. seem im- impor- the cost regarded as' sufficient merchandise there not consideration, price he than the would let alone lower give porter tance competitive for a similar pay controlling consideration. have States would produced in the United article hold, majority means I If the unfair method constitute does, that the acts com- that it am not sure 337, supra.” purview section within because the im- plained of are not unfair finding of the not shown to have porter himself is know- within the con- thing, particular complained to. a acts ingly done unfair clearly lead to industry, provision would or an such a troverted individual as is above operation unjustifiable conclusion of no such take many places in the Congress, in patent matters, (a), indicated. act, section all. recognized the existence of such complete has bring nul- about but would attempted to take care provision. has situation and of the whole lification must which, by levying duty at least the- many that there are other of be remembered production. oretically, equalizes the costs acts aimed made, provision for special knowledge also provision. It is common pro- flexible tariff subject-matter in the (a), By section vision act. aiming Congress was USCA § costs production costs unless at lower involved clearly unfairness, such as an element of case the record appears from court of this other cited cases (a). involving section 337 construction I do not contend ignores the (a) of section 337 word that, “unfair,” earnestly insist but I do most determining under the what new, used, lose language must not broad sight expressed purpose of the act —to save American industries. We should n E.Hume C., Talbert,' Washington, D. unhesitatingly hold that an evasion our appellant. by manufacturing laws abroad what GRAHAM, Judge, Presiding Before could not be manufactured here is unfair to BLAND, HATFIELD, GARRETT, by pat- American industries tied which are LENROOT, Judges. Associate ent restrictions. findings of the Commission which BLAND, Judge. Associate

are here involved should be affirmed. from deci- here Appellant appealed has Appeals of the Board sion Office, that of the affirming Patent pri- awarding of Interferences in examiner appellee in the two ority of invention involved, appear which Primary counts suggested Count by the Examiner. illustrative, “I. The com- and follows: 1 is having frame with an automobile bination (Patents) motor on the 22 C. C. P. A. member and a front cross frame, auxiliary dampening vibration of an BERMAN RONDELLE. rig- consisting pair of brackets support Appeal Patent 3442. No. motor, the front of the within idly secured motor the front end the confines Appeals. Court of Customs and Patent therefrom, depending divergently casing and March 1935. having lat- ends of said brackets the lower ears, cooperative and be- cushions with eral front cross member and said tween ears co-axially the ears and diverging holding said ears and the cushions means member, on said cross relation assembled thereby providing compensating means for torque motor move- due vibrations ment:” to be The invention relates brackets support of the in connection with

used A Ford ib automobile. motor a model of construction of Owing to the manner springs supporting the motor' between car, model frame in that and the Ford vibration, and the there was excessive supports here involved eliminated' bracket inherent in that model of the vibration much car. is no raised as to the in- There counts, terpretation right same, party to of either make the

Case Details

Case Name: In Re Amtorg Trading Corporation

Court Name: Court of Customs and Patent Appeals

Date Published: Feb 25, 1935

Citation: 75 F.2d 826

Docket Number: Customs Appeal 3790

Court Abbreviation: C.C.P.A.