222 F. 599 | 6th Cir. | 1915
(after stating the facts as above).
It is, then, in the truth of the positions thus taken as to the meaning of the count in these two particulars that an opening is made for the claim of duplicity. If its allegation were that each of the competitors named was in existence during the entire 20 years there would be no such opening. A single conspiracy against them specifically would include them all. But as they were not all so in existence, how is it possible for a single conspiracy to cover them ? It may be thought that there must have been a conspiracy against those in existence at the beginning of the 20 years, and then successive conspiracies against the others as they came into existence. If such were the case, undoubtedly the count would be duplicitous.
In 5 R. C. L. p. 1081, it is said:
“The court will never be keen to bold an Indictment bad for duplicity.”
The second count alleges that the defendants had monopolized a part of the interstate trade and commerce in cash registers. It alleges that
Assuming that what was done, as set forth in the count, constituted monopolizing within the second section, it is questionable whether the company was not the monopolizer and the defendants were mere aiders and abettors. But as aiders and abettors are liable as principals this is unimportant.
“Tlie idea of monopoly is not now confined to a grant of privileges, but is understood to include a condition produced by the acts of individuals.”
fu the case of such a monopoly it would seem that it is not essential that all but the insiders he wholly excluded, so that they have the whole field to themselves. It is sufficient that outsiders are substantially excluded, so that the insiders have to themselves approximately, or “a largely preponderating part of,” the whole field. But the section does not cover every monopolizing by the acts of individuals. A monopolizing by efficiency in producing and marketing a better and cheaper article than any one else is not within it. However, possibly, efficiency is so abundant that in experience there never will be, as there never has been, such a monopolizing. It is possible for there to be a monopolizing by a combination of competitors. Such combinations have been divkh ed into “combinations by agreement,” or “loose combinations,” in which each member of the combination remains in the field, notwithstanding the combination, as in the case of Addyston Pipe & Steel Co. v. United States, 175 U. S. 211, 20 Sup. Ct. 96, 44 L. Ed. 136, and “combinations by fusion,” or “corporate combinations,” as in the Standard Oil and Tobacco Cases. Possibly in cases of the former class, where there,is no exclusion of outsiders, it is not proper to say that there; is a monop-,
“Its [monopoly’s] dominant thought now is, to quote another, ‘the notion of exclusiveness or unity’; in other words, the suppression of competition by the unification of interest'or management, or it may be through agreement and concert of action. And the purpose is so definitely the control of prices that monopoly has been defined to be ‘unified tactics with regard to prices.’ ”
A combination 'of competitors, accompanied by exclusion of outsiders, and the exclusion by a competitor, or by its officers and agents on its behalf, of competitors by the use of such means as are charged here, clearly constitute monopolizing within the section. Mr. Chief Justice White in Standard Oil Co. v. United States, 221 U. S. 1, 31 Sup. Ct. 502, 55 L. Ed. 619, 34 L. R. A. (N. S.) 834, Ann. Cas. 1912D, 734, pointed out that monopolizing was a species of restraint of trade or commerce, so that a combination or conspiracy to monopolize a part of interstate trade or commerce is covered by both sections. In this particular they overlap. We have seen that conspiracies in restraint of trade and commerce are not confined to conspiracies, by competitors, or on behalf of a competitor against a competitor. It is not even necessary that the execution of the conspiracy be of any benefit to the conspirators. . It is sufficient that it will restrain the interstate trade or commerce of the person conspired against. But in the case of monopolizing under the second section, where there is exclusion by a competitor, or a combination of competitors, of competitors substantially from interstate trade or commerce, it is in order that the former may have the whole or approximately the whole of the field to itself or themselves. It is penalized, so that there may be no such exclusion, and the field may be occupied by all on equal terms.
It follows from this general survey that there can be no monopolizing in the legal and accurate sense of the word, where there can be no common occupation. Where in the very nature of things there must be exclusion of all othesrs but one, there can be no monopolizing. Hence it would seem that there can be no monopolizing in making a single interstate- sale, or in making a great number of such sales, even though wrongful means are used in making them. A wrong has been done the competitors, but the wrong is not that of monopolizing. In the very nature of things but one competitor can make the sale. 'The idea that such conduct constitutes monopolizing is not according to the legal and accurate meaning of the word. It car only be such according to a popular conception thereof.
“Undoubtedly every person engaged in interstate commerce necessarily attempts to draw to himself, to the exclusion of others, and thereby to monopolize, a part of that trade. Every sale and * * * transportation of an article which is the subject of interstate commerce evidences a successful attempt to monopolize that trade or commerce which concerns that sale or transportation. If the second section of the act prohibits every attempt to monopolize any part of interstate commerce, it forbids all competition therein, and defeats the only purpose of the law; for there can be no competition, unless each competitor is permitted * * * to draw to Himself, and thereby to monopolize, some part of the commerce.”
But there was no reason for such apprehension, for, as we have seen, interstate sales do not come within the section, because in such cases there is no monopolizing. It is only the conception of the meaning of that word according to popular speech that could create such
“As this section prohibits a monopoly of, or an attempt to monopolize, any part of such commerce, it cannot be literally construed. So applied, the act would prohibit commerce itself.”
In dealing with this subject the Supreme Court, speaking by the Chief Justice, in the Standard Oil Company Case, 221 U. S. 61, 31 Sup. Ct. 516, 55 L. Ed. 619, 34 L. R. A. (N. S.) 834, Ann. Cas. 1912D, 734, said:
“The commerce referred to by the words ‘any part,’ construed in the light-of the manifest purpose of the statute, has both a geographical and a distributive significance; that is, it includes any portion of the United States- and any one of the classes of things forming a part of interstate or foreign commerce.”
This excludes therefrom the interstate trade or commerce of a particular prospective purchaser of a particular commodity, and confines-it to the interstate trade or commerce of all prospective purchasers of a particular commodity in the United States or in some particular-portion thereof. Reasoning from the analogy to a monopolizing by sovereign grant leads to the conclusion that such is a true construction of the section. In case of such monopolizing it is of a particular commodity, and in olden times in England it was limited in some instances to particular portions of the kingdom.
Now, the offense of monopolizing consists not only in obtaining or securing, in the first instance,' a monopoly by the wrongful acts of individuals, but in holding and. maintaining it by such acts. According to the' allegation of the first count, during the preceding 3-years the National Company had a practical monopoly in, cash regis--
“Only In the exact administration of the law will justice in the long run he done, and the confidence of the public in such administration be maintained.”
On this ground we think the count is defective, and that the court erred in overruling the demurrer thereto.
But it is otherwise insufficient. It does not charge an offense against the United States, i. e., the offense of monopolizing a part of interstate trade and commerce, and that for two reasons. According to the allegations of the first count, made a part of this, the cash registers manufactured and put on the market by the National Company during the 20 years were patented. It owned patents which covered them. So • far as the third count goes, the interstate trade and commerce
“It also is true, of course, that tire mere continuance of the result of a crime floes not continue the crime.”
It must be held, therefore, that the third cpunt is bad, and the lower court erred in overruling the demurrer thereto.
“Provided, that terms of the District Court for the Southern district shall be held at Dayton on the first Mondays in May and November. Prosecutions for crimes and offenses committed in any part of said district shall also be cognizable at the terms held at Dayton. All suits which may be brought within the Southern district, or either division thereof, may be instituted, tried and determined at the terms held at Dayton.”
This is a continuation or re-enactment of the act of March 4, 1907 (34 Statutes at Large, 1294), which first provided for the holding of terms of court at Dayton. This prosecution was instituted at Cincinnati. It is not claimed that the lower court abused its discretion, if, indeed, it had any, in overruling this motion, but that defendants were entitled as a matter of right to have the case transferred to Dayton for trial. The sole ground of the motion was that the National Company’s plant and principal office is located there, and 11 of the defendants resided there, and that none of them resided at Cincinnati. We fail to find any basis whatever for this position. It will be noted that
It may be assumed in this connection that there was substantial evidence that the generic conspiracy and the specific conspiracy against the competitors who ceased to exist prior to 1907 included the use of such means, but it does not follow that the conspiracy against the American of Columbus included the use. thereof. There was not a
It is, however, urged on behalf of defendants that the decision in the case of Commonwealth v. Harley, 7 Metc. (Mass.) 506, is against the consideration of a generic conspiracy in this casé at all. It was there held that, under an indictment charging a conspiracy to defraud Stephen W. Marsh, evidence was not admissible of a conspiracy to cheat the public generally, or any person who might fall in the way of the conspirators. This was, however, on the ground— it could only have been on that ground — that the charge in the indictment excluded the thought of a generic conspiracy, and charged a conspiracy which in its origination was a specific conspiracy against Stephen W. Marsh. But that is not the case we have here. It is true that the indictment charges a specific conspiracy only, but it is not a conspiracy which was specific in its origination. In its origination it was a generic conspiracy, which became a specific conspiracy by being directed against the competitors named as they came into existence. Hence it was a pertinent question in the case whether there was a generic conspiracy during the 20 years, and there was no variance.
In the case of People v. Gilman, 121 Mich. 187, 80 N. W. 4, 46 L. R. A. 218, 80 Am. St. Rep. 490, a conviction was upheld under an indictment charging a conspiracy to defraud Edwin H. Sadler upon evidence of a conspiracy to cheat such persons as might be induced to attend certain seance meetings, and that he attended them. The decision is in conflict with the Massachusetts case, unless the indictment permitted the construction that it charged a specific conspiracy against Sad-ler by reason of a generic conspiracy being directed against him.
*631 ‘It Is true That the unlawful, agreement satisfies the definition of the crime, but it does not exhaust it.”
And again he said:
“A conspiracy is constituted by an agreement, it is true; but it is the result of the agreement, rather than the agreement itself, just ás a partnership, although constituted by a contract, is not the contract, but is the result of it. The contract is instantaneous; the partnership may endure as one and the same partnership for years. A conspiracy is a partnership in criminal purposes.”
Here we have an accurate definition of a conspiracy. It is “a partnership in' criminal purposes,” to which we might add, brought about by an agreement. So long, then as the partnership in a criminal purpose continues, the conspiracy continues. And it may continue without anything being done in furtherance of it. X. and Y. conspire on a day or two before the beginning of the period within which an indictment on a certain date may be found to murder Z., or to commit some other crime, on a day certain one week off; i. e., several days after the beginning of that period. After the beginning thereof, they abandon the conspiracy, either by a formal understanding, or by allowing the day to go by without doing anything, and never renewing it. In such case the partnership in the criminal purpose continues into the period. In so far, then, as it continued into the period, it was not barred by the statute of limitations. The mere fact that the prosecution for the agreement which initiated the partnership is barred is no' reason for barring it as to so much of the partnership as has continued hito the period. It may he important to show something done in furtherance of the conspiracy within the period to establish its continuance into it. It is not essential to its continuance thereinto.
We come, then, to the question whether the government was entitled to a submission of such case to the jury. This depends on whether there was substantial evidence in support of that case. By substantial evidence we mean evidence fit to induce conviction. And in determining this we limit ourselves entirely to the government’s evidence, for it is not the province of the court, on a motion for a peremptory instruction, to weigh the evidence. That is for the jury only, except that it may be weighed by the court on a motion for new trial. Jenkins & Reynolds Co. v. Alpena Portland Cement Co., 147 Fed. 641, 77 C. C. A. 625.
All but three of the plaintiffs in error were connected with the National Company when the indictment was found, and most of them were connected in one or the other of the capacities above set forth, and had been so for some time. The plaintiff in error John H. Patterson was president; Edward A. Deeds, vice president and a director, and possibly assistant general manager; William F. Bippus, treasurer and a director; Alfred A. Thomas, general counsel and a director; Robert Patterson, a director; Thomas J. Watson, sales manager; Joseph E- Rogers, assistant sales manager; Alexander C. Harned, executive secretary; Alexander W. Sinclair and John E. Range, company salesmen; and Frederick S. High, Pliny Eves, Arthur A. Wentz, George E. Morgan, Charles T. Walmsley, Charles A. Snyder, Walter Cool, Myer N. Jacobs, Mont E. Lasley, M. G. Keith, J. C. Eaird, W. C. Howe, and E. H. Epperson, district managers. It, is not certain that the plaintiff in error Jonathan B. Hayward was then connected with the company; if so, it was as patent-counsel. The plain-tiff in error William H. Muzzy ceased his connection in 1911, and was then connected with the patent department at least as an attorney. Both Hayward and Muzzy had been members of the competition committee. And the plaintiffs in error William Pflum and Earl B. Wilson
We think it clear that there was substantial evidence to the effect that there was a conspiracy on the part of those officers and agents of the National Company who then had to do with competition against most, if not all, of the competitors named who were in existence before the American of Columbus came into existence, which was not later than the early part of 1907, except the Peninsular, Burdick-Cor-bin, and Dial, as long as they were in existence within the 20-year period, and that this conspiracy included the use of some, if not all, of the means specified, and other means not specified aimed to be covered by the eleventh item, and that when that company came into existence there was a generic conspiracy against all competitors, at least all who might endanger the National’s supremacy, which generic conspiracy had been in existence at least from the beginning of the 20 years. In an issue of a publication of the company seemingly for distribution amongst its officers and agents, of date May 1, 1892, occur these statements:
"If the opposition knew what is in store for them, they would not waste any more time and money staying in the business. They are all beginning to realize that there is no hope for them.”
"It is only a question of whether we propose to spend the money to keep down opposition. If we continue, it is absolutely certain no opposition company can stand against this company and its agents. If necessary, we will spend five times as much money as we have already done, in order to down opposition. If they really believe this, they will throw up the sponge and quil.”
“Wo are receiving overtures to buy out opposition. We will not buy them out. We do not buy out; we knock out.”
In an issue August 1, 1895, occurs this statement:
“We are determined to absolutely control the cash register business.”
And in an issue of date March 25, 1897, after setting forth the policy of the company of frankly informing a competitor of the purpose to drive him out of business, occurs this statement:
“This, it is true, is what is called ‘securing a monopoly’; but we think there can be no possible economic or other objection to it. Cash registers are not a necessity of life. Any one who chooses can do business without them, thus contributing nothing to the ‘monopoly.’ ”
It is then stated that “this monopoly” “is managed upon a liberal and broad-minded plan.” And at a convention of the district managers held at Dayton July 22, 1907, the defendant John H. Patterson, president, thus expressed himself to them:
“We want Mr. Anderson of the competition department to give you a little idea of how we are going to control competition. We want. Mr. Hayward also to give you a little talk. We want Mr. Muzzy to tell you how we are going to absolutely control the competition of the world, because we want yon to feel this way. The first thing we aim to do is to keep down competition.”
“I asked the Standard Oil .Company what was the secret of their success, and they said this question could be answered in a very few words. Men, nothing but men; men well organized; they will keep down competition and make things succeed.”
In the publications of the company and in the communications between the officers and agents having to do with competition, terms of warfare were not infrequently used, such as battle, fight, enemy, ammunition, shot, whipped, victory, and flags flying. During that time all the competitors named then in existence retired from the field. The American of Philadelphia, Boston, Hailwood, International, Hubinger & Carroll, and Latimer quit. The National does not seem to have been the cause of the Latimer quitting. The Century, Chicago,, Cuckoo, Globe, Ideal, Kruse, Lamson, Metropolitan, Navy, Osborn, Standard, Simplex, Sun, Toledo, Union, and Weller sold out to the National, and it discontinued their business. The American of Philadelphia and Boston quit because of infringement suits brought against them by the National, in which it was successful. The decisions in its favor against them are National Cash Register Co. v. American Cash Register Co. (C. C.) 47 Fed. 212; National Cash Register Co. v. American Cash Register Co., 53 Fed. 367, 3 C. C. A. 559; National Cash Register Co. v. Boston Cash I. & R. Co., 159 U. S. 261, 15 Sup. Ct. 1041, 40 L. Ed. 142. The result of this litigation may possibly have had something to do with other competitors quitting or selling out. Infringement suits were brought against most, if not all, the others, and these suits had more or less to do with their quitting or selling out. There was evidence tending' to show in some of these instances at least that the claim of infringement was unfounded and known to be so, and that the suits for infringement were not brought in good faith, but for the sole purpose of aiding in driving the competitors from the field. The government claims that such was the case in all instances. In most, if not all, of these instances, some, if not all, of the other means were resorted to, and it is not unlikely that in some instances at least they were more effective than the suits. And such means were resorted to in some, if not all, the cases where the suits were successful. The Hailwood, International, Century, Chicago, Cuckoo, Globe, Ideal, Metropolitan, Navy, .Osborn, Simplex, Sun, Toledo, Union, and Western retired from the field during the 7 years prior to 1907. Most, if not all, of the others retired before then, and mainly in the early part of the. 20-year period.
In justice to the National Company and the defendants it should be .noted that it was the pioneer in the cash register business and developed it. It owned the basic patents and must have acquired in a proper manner a very great number of improvement patents. In addition to this, it had the advántage of very great capacity in the management of its affairs. These two considerations together, without reference to any unfair treatment of its competitors, are sufficient in themselves to account in a large measure for the success* it has attained. And it is .not unlikely that its trade was pirated by other competitors' besides the. American of Philadelphia and the Boston, against whom it, obtained
We think it clear, also, that there was substantial evidence to the effect that this generic conspiracy was directed against the American of Columbus when it came into existence, and became specific as to it, and that it continued up until just shortly before the beginning of the 3-> ear period. The only other competitors then in existence were the Peninsular, Burdick-Corbin, and Dial, neither of which, as stated, was of much consequence. That company was the successor of the International, and it in turn of the Hailwood. The Hailwood during its existence, which covered a number of years, was one of the National’s most stubborn competitors. It' went into the hands of a receiver in 1903 or 1904. There was evidence tending to show that an effort was made, whilst its assets were in such hands, by the National, to acquire them without its being known in the transaction. The International acquired them, and then the American. Its connection with the Hailwood not unlikely aided it in getting established in business soon after entering the held. Sb identified with the Hailwood was it that its machines were frequently called Hailwood, and it, sometimes, the Hailwood Company. In view of its connection with the Hailwood Company, one would expect the generic conspiracy to be directed against it as soon as it came into existence, and so the government’s evidence tended to show. May 4, 1907, the district manager at Detroit, Henry P. James, wrote to the assistant head of the competition department, Joseph R. Warren, that the Hailwood (i. e., American) situation in Detroit looked rather serious, and suggested the employment of the plaintiff in error Alexander W. Sinclair, then-off the roll, to hire the Hailwood agent at that point. Warren answered that the competition did not warrant, placing Sinclair on the roll again, and suggested that he (James) was in a better position to hire the agent than Sinclair. There was no evidence of anything else of a specific character during this year. But there were general statements as to competition which could not have had reference to any one but the American. Such was the statement of plaintiff in error John H. Patterson, at the convention of district managers July 22, 1907. June 20, 1907, the general manager, Hugh Chalmers, wrote to all the sales agents and salesmen, suggesting that they call on the users of competing machines and point out to them the weaknesses and deficiencies thereof, so that, even if they could not make a trade, they would cease to he a “plugger” for the opposition. And September 6, 1907, the bead of the competition department, C. D. Anderson, wrote James at Detroit that the company was never in better shape to take care of competition than at that time, and for that reason they did not intend to let it increase again.
March 1, 1908, the plaintiff in error Sinclair entered the employ of the American and located at Detroit. It is possible that he was then still off the National’s roll. He continued in its employ there until September 24, 1908. During this time a vigorous effort was made to drive him from the field, and it finally succeeded, when he re-entered the National’s employ as a company salesman, and so continued until
After Sinclair ¡returned to the service of the National, he was sent to Toledo, Ohio, where he remained at least until in November, 1908. Whilst there he adopted the same tactics that had been used against him in Detroit to drive out the agents of the American at that point. Finally, in the middle of January, 1909, James, the district manager at Detroit left the service of the National, and in breach of a contract that he had with it at once entered the employ of the American and was placed in charge of several states, with headquarters at Detroit. In the early part of February, 1909, certainly not as late as the 22d of that month, the new district manager appointed to take the place of James at Detroit was installed. At a meeting of the sales agents and salesmen who were to be under him, held on that occasion, the plaintiff in error Watson was present and undertook to outline the policy
Thus it is that the government’s evidence tended to establish a conspiracy on the part of some of the defendants at least against the American, and brought it clown almost to the door of the 3-year period. It remains to consider whether there was substantial evidence to the effect that it entered that door. Possibly in view of the fact that the American was still actively in business — that what had transpired preceding the 3 years down almost to it indicated an absolute and fixed purpose to restrain the trade of the American, if not to drive it out of business, without any indication of a change of purpose before the 3 years — and that the American was represented at Detroit by the National’s former representative, against whom it had a grievance, it was for the jury, without more, to determine whether the conspiracy continued into the 3 years. But the case does not depend upon presumptions. Things were done within the 3 years by representatives of tin* National in restraint of the American’s trade and commerce. According to the defendants, all that was done was by sales agents and salesmen, and none of the plaintiffs in error were directly connected with it; and what was done by sales agents and salesmen was scanty, in view of the fact that the National had 750 of such representatives distributed throughout the country, and the American was doing business all over it. They- urge that what the government’s evidence established was done should be taken as being all that was done. The American knew of all unfriendly action towards it, and -actively assisted it in the prosecution of the case, and the evidence disclosed that it made a very thorough investigation. Here, according to defendants, was all that was done. In 22 instances sales agents and salesmen of the National attempted to induce purchasers of American machines, who had not paid for them, to repudiate their contracts by seller’s talk and offering to allow them what they had paid on the purchase price of Nationals, in two, and possibly three, of which instances the attempt was successful. They occurred in 14 different states and 17 different localities. Ten of them occurred in 1909, 7 in 1910, and 5 in 1911. Defendants would have it that these were all such instances, but the tendency of the testimony of Steubenrauch is to establish 8 others, 6 of which were in 1910 and 2 in 1912, in Connecticut. In addition to these the acts in restraint covered by the government’s evidence were the display in March, 1909, by the National’s sales agents at Los An-geles, in California, in his show window, smashed-up Hailwood cash registers with a card bearing this inscription:
“Hundreds of merchants have exchanged unsatisfactory Hailwood cash registers for Nationals. We sell them at 30 cents on the dollar. But as they have no commercial value and do not sell, we are compelled to break them up to make room and will sell as Old Junk”
—an unsuccessful attempt by the sales agent of the National at Dallas, Tex., in the winter of 1909-10 to bribe a drayman in the employ
“The National Cash Register Company.
“New York, April 1, 1909.
“To All District Managers:
“Mr. M. N. Jacobs: In the various conventions I have attended, I found that some of the newer members in the districts are not thoroughly clear on the best way to handle sales made by other companies. Please see that every agent in your district thoroughly understands our position in the matter.
“You know what this policy is, but in brief will say that in no case will we permit any of our agents to misrepresent cash registers manufactured by other companies, neither will we permit any agent or person in our employ to induce any purchaser of a cash register made by any other company to break*639 ills contract and return the register to the manufacturer. 'With the line of registers that our agents now have, they are able to show the superiority of Nationals over those oí any other make and at lower prices.
‘•There has been no violation of our policies that I know of, but I give you this information because of the inquiries received from the newer men in the field.
“Please see that these instructions are carried ont in every detail and that the new men are so instructed on entering the field.
“Yours very truly, Wm. Pflum,
“W. 1\ — T. Vice President and Manager.”
There is room to claim that such is the. only reasonable ground to account for this letter being* written *and sent out. If so, there is room to claim, further, that the conspiracy continued at least until then.
4. It is now in order to take up the assignments questioning rulings upon the admissibility of evidence. They are very numerous, but the consideration of them can be shortened by classification. In considering them, the case for the jury, as we have determined it to have been, should be kept constantly in mind. That case is whether within the three years the defendants conspired in restraint of the trade of the American of Columbus, by the use of the fifth and ninth means. No evidence that was not relevant thereto was admissible, and all that was was admissible, if not otherwise objectionable. The primary classification of these rulings is into those involving evidence that was admitted and those where the evidence was excluded. We consider first those where the evidence was admitted. In this connection it may be said generally that the admissible evidence was not confined
The admitted evidence involved in the rulings covered by the assignments relates to transactions within the 3 years and to transactions prior thereto as far back as the beginning of the 20 years. Here we consider first that which relates to transactions within the 3 years. And that may be divided into the evidence of the acts in restraint of the American trade, heretofore referred to, evidence of an act against that company, not heretofore referred to, and evidence of acts against the Michigan and Dial companies.
“Whatever is done by an agent in reference to the business in which he is at the time employed and within the scope of this authority is said or done by the principal, and may be proved as well in a criminal as in a civil case in all respects as if the principal were the actor.”
But this doctrine can -have no application here, as the persons who did the acts — i. e.,.sales agents and salesmen — were not the agents of the defendants. They were the agents of the National Company. They were under defendants, but this did not make them defendants’ agents. It urges further that they were co-conspirators with defendants, and under the case of Clune v. United States, 159 U. S. 590, 16 Sup. Ct. 125, 40 L. Ed. 269, what one conspirator does is evidence against the other, even though he is not a defendant or charged with being a party to the conspiracy in the indictment. Possibly this is sufficient to uphold the action of the court in admitting the evidence. But it is not necessary to rely on it. All the acts were done in the regular course of the business of the National Company. Those sales agents and salesmen were under the direct supervision of some, at least, of the defendants. There was substantial evidence that
“Parents would be of little value if infringers of them could not be notified of the consequences of infringement or proceeded against in the courts. Such action considered by itself cannot be said to he illegal. Patent rights, it is true, may be asserted in malicious prosecutions as other rights * * * may be. But this is not an action for malicious prosecution. It is an action under the Sherman Anti-Trust Act for the violations * * * of that act, seeking treble damages.”
He did not mean by that that no recovery could be had under that ad for damages caused by a conspiracy in restraint of interstate trade by the malicious prosecution of suits for infringement. He mcanl no more than that it did not appear that there was any such conspiracy in that case. So far as appeared,'both suits were brought in good faith.
But here there was evidence tending to show that suits were not brought in good faith, and, on the contrary, were an “illicit use of the courts as instrumentalities of oppression,” condemned in the case of Commercial Acetylene Co. v. Avery Portable Light Co. (C. C.) 152 Fed. 642. Besides, there was evidence tending to show in certain of the cases, at least, that the bringing of the suit was not
This brings before us the question whether a patentee and another, or the officers and agents of a patentee, can conspire in restraint of the interstate trade or commerce in the article covered by the patent of persons who have no right to engage in such trade and commerce, and who by engaging therein infringe the right of the patentee; i. e., whether such a conspiracy comes within that section. Its disposition involves the rights of a patentee. These rights are two, one statutory,
We are not concerned here with the question as to what a patentee may himself do in a general way to protect the substantive right which he has from invasion. The question in hand is whether he and another, or his officers and agents in his interest, may conspire to prevent an invasion of his rights in the interstate field by the use of any such means. This depends solely on whether such a conspiracy is within the first section of the Anti-Trust Act. And it would seem that to ask this question is to answer it. The terms of the section are of a most sweeping character. It includes every conspiracy in restraint of interstate trade or commerce. It is not a question whether it is rightful or wfongful interstate trade or commerce that is covered by the conspiracy. It is sufficient that it is interstate trade or commerce. If two or moré persons in no way interested in a patent were to conspire in restraint of the interstate trade or commerce of an infringer, no one would contend that the conspiracy was not covered by the statute. No more is it open to contend that a conspiracy by a patentee and another, or by the officers and agents of a patentee in his interest, to restrain the interstate trade or commerce of an infringer, is not within the statute. The intent of the statute was to sweep away all conspiracies in restraint of such trade or commerce, whatever their character may be. The statute respects the monopoly of the patentee. It to no extent invades the rights conferred upon him by his patent. Bement v. National Harrow Co., 186 U. S. 70, 22 Sup. Ct. 747, 46 L. Ed. 1058; United States v. Winslow, 227 U. S. 202, 33 Sup. Ct. 253, 57 L. Ed. 481. But the right to conspire with
•‘Itislits conferred by patents are indeed very definite and extensive, but they do not give any more than other rights a universal license against positive prohibitions. The Sherman Law is a limitation of rights- — rights which may be pushed to evil consequences, and therefore restrained.”
We are therefore clearly of the opinion that the defendants were not entitled to offer evidence that the trade and commerce of the American of Columbus in cash registers was covered by an unexpired patent owned by the National.
Now, as hearing on that question, we think that the defendants were entitled to prove, if they could, that the machines of those competitors were infringements. The means covered by the seventh item were in effect malicious prosecutions against those competitors — the bringing of suits for infringement, not in the belief that the National had a good cause of action against them, but without regard to whether it had or not — in order to drive them from the cash register field; i. e., in bad faith or without probable cause. A suit for malicious prosecution cannot be brought until the termination of the prosecu
5. It remains to consider the errors assigned in connection with the charge to the jury. Rut few exceptions were taken to the charge which was given, and no assignment, of error in this connection has been argued. We therefore pass these exceptions by. The court submitted all three counts to the jury. The defendants requested that the jury be instructed to find them not guilty on the second and third. In accordance with our holding as to the sufficiency of these two counts, the defendants were entitled to have the jury so instructed. The first count alone should have been submitted to them.
(1) “To require the agents of their company to report the names of persons who had purchased cash registers from competitors, or to secure samples of machines from time to time put on the market by competitors.”
(2) “To sell or offer and try to sell National cash registers to persons who had bought and owned competing cash registers in exchange at such price as was satisfactory to the parties.”
(3) “To compare by comparative demonstrations or otherwise competitive cash registers with National cash registers, for the purpose of demonstrating the superiority of the National cash registers, and thereby induce the prospective purchaser to purchase the National cash register.”
No objection can be made to the last proposition, but the other two were too broad. They need qualification. It was unlawful for defendants to do as stated in the second proposition, if the doing thereof involved the purchaser and owner of the competing cash register breaking his contract with the competitor in any particular, or was done for the purpose of driving the competitor out of the cash register field. One competitor has the right to try to sell by fair means all of his goods that he can, and if the effect of his selling is to drive another competitor out of the field he is not to blame. But it is wrong for one competitor to want to drive another competitor from the field by unfair or illegal means, and to take steps to that end, so that he may have' the field free from such competition and thereby be enabled to sell his goods.
Then, as to reporting purchasers of competing registers and securing samples, it all depends on the manner in which the information in the one instance and the samples in the other were obtained or secured. If in a proper manner, nothing unlawful was done.
We do not deem it necessary to consider the other requests asked and refused.
We are constrained, therefore, to reverse the judgment of the lower court, and remand the case for a new trial and further proceedings consistent herewith.