*1 even respondent, it is observed but opinion is stated that: me convince
“The does not record discrim-
either or Milburn was Schwachel
inatorily discharged. is substantial There colleague’s conclu- support my
evidence to were, and I would
sion that say men could
last to reasonable
reach that result.” observed, ques- already As has.
tion before whether the Board was preponder- charge sustained
ance of involved the evidence. This and determina-
weighing of the evidence credibility of the witnesses. question however, very ,us, is a before finding Is the Board
narrow one: competent evi-
sustained substantial Being
dence? the view that there of. sustaining competent substantial evidence finding, order enforced. will CLARK,
STANDARD CO. et al. v. OIL Atty. Gen. 185, Docket 20406.
No. Appeals, Second
Circuit Court Circuit.
Sept. 22, 1947. *3 Markham, Standard Oil
See also Co. 332; Id., F.Supp. F.Supp. Kenyon Davis, S. W. Theodore John City (Kenyon New York Ken- both of & Edgar Baumgartner, Ralph F. yon, M. Car- son, Bissell, Taggart Whip- W. Harold Oxidation, Oppanol, and Arc, Paraffin brief), for lene City, on the ple, all of New York processes. Buna plaintiffs. fascinating picture of presents case Asst, Gen., Atty. Sp. Isenbergh, M. S. interrelationships private two vast Morrisson, Atty., Claims L. and James empires, largest among the commercial Washington, C. Div., Dept. Justice, D. co-operation world, hearty acting Atty., New McGohey, S. (John X. U. F. opera- respective fields o'f division Atty. Sonnett, City, F. Asst. York John making plans executing Atty. Gen., LeRoy Sp. Harry Jones, Asst. co-operation continuance under the Gen., Cutler, Coun Acting Gen. Ward John *4 developing approach- of friction and stress Friedmann, Atty., sel, Of and Maximilian war which ing between the of countries Dept. Justice, of Property, Alien fice of were, all, respectively after nationals. C., brief), the Washington, of D. both purposes appeal For the of need' defendant. attempt to set forth- that extensive FRANK, CHASE, CLARK, Before and fact, detail; history-in Judge as a matter of Judges. Circuit Wyzanski, in searching and his de- careful below, cision Standard Oil Co. Mark- ham, D.C.S.D.N.Y., F.Supp. has CLARK, Judge. Circuit light made the of the review as labors property This an action to recover permit. nature the momentous issues wrongfully seized claimed to have Broadly I.G. speaking, great German the Prop- the vested himself Alien and Farbenindustrie, A.G., developed orig- Custodian, corpora- brought by four erty inal means and methods of manufacture usually “Jersey” tions referred to the production respect and with gasoline, corporations parent group. The are the oils, rubber, and group of \Vhichthe Company holding company, Standard Oil exploitation, desired to obtain Standard, (New Jersey), and referred to as particularly light the of its with concern Develop- Oil three subsidiaries: Standard apparently the limited reserves oil the Development; Company,called ment Stand- negotiations opened world. So Company, Catalytic originally S.I.G. ard 1926; 1929,agreements and were en- Compa- Company, thereafter Standard respective parties tered into S.I.G.; usually and ny, and to as referred end, involved, among things, ques- Incorporated. Jasco, organization jointly of new controlled in himself tion vested the Custodian companies pay- —S.I.G. Jasco—and corpo- being of the German ments going many into millions ration, Farbenindustrie, A.G., I.G." called American German interests for the I.G.; plaintiffs’ but contention rights thus obtained. Court District is, by themselves, instead, owned American arrangements, has held those prior as had corporations. consists of stock of shares October, 1939,legal so far as the Trad- corporations of American and United Enemy ing with the isAct concerned. But hydrocarbon States field at that date the outbreak of World War II petro- gas, the treatment natural crude occurred, already parties leum, coal, produce and other materials arrangements then for the transfer of oil, products in gas, marketable natural stocks, patents, and other property gasoline Specifically industries. it con- American interests. These latter transfers stock, shares of 200 sisted adjudged sham, the court to be made with stock, Hydro- shares of shares of merely passing intent of apparent Synthesis Corporation (USAC) carbon possible title later seizure stock, many relating hundreds United States Government in the event hydrocarbon directly to parties event principally war—an which the correctly patents, many Class field called foresaw—with ownership beneficial still patents merely corporation. useful in that fact the German hundreds Hence patents, Class the judgment outline field called broad below re- patents relating Acety- many turned to the property ac- agreed negotiate parties document both 1939, agreement October, quired before newly under which concerning the terms And remainder. to return the and refused be as- specific were to processes discovered opposing appealed. so both development and ex- signed to Jasco here ultimate below and issues Thus stock, issued 10 shares ploitation. Jasco the owner- upon the turn determination between were divided evenly specific stock and blocks of ship Hague Development. the later Until nonexistence patents, existence or which the Agreement process equitable rights in parties purported substantial- give rights. ownership those and extent experiments ly more than to conduct complicated by a con- problems are These Oppanol process. was the prosecution in 1942in entered decree sent Standard, together including indi- I.G. and others, Royal Dutch for viola- two other companies, vidual officers of the —the Corporation— Kellogg laws, group this decree Shell antitrust since Synthesis Hydrocarbon Corpo- rights in parties’ bearing formed has some USAC, problems ration, control the also called Before *5 ' exploitation processes for the reached, however, of certain also con- we must are gasoline. general manufacture Of the gas sider defenses and two over-all which 1,700 corpora- of stock rejected by shares issued this were the court below. These tion, bring- Kellogg plaintiffs and each took 425 or are from Shell barred S.I.G., all, agent acting and the I.G. ing the at since acted for action Jersey interests, and took then to conceal American of a assets friendly foreign power; and that Jersey approach of the war the With may not recover of lack of because clean sought interference group to forestall Anti- and violation of Sherman hands Govern- participation by the United States trust Act. management and ment in the interests of its property. Its Jersey general
1. I.G. Interrelations. The means toward this and transaction I.G. and the end interests owned property earliest was to have between Jersey important apparently was trans- group in case I.G. transferred policy, Four-Party Agreement, in Pursuing itself. reached ferred to terms, September, pur- early 1929. Pursuant S.I.G. was in to Standard for exploit Germany stockholding created to outside certain I.G.’s in chased $20,000, purchase price. patents belonging original I.G. The were groups, divided into two the Class September, representatives In late patents, A relating princi- wholly or Jersey group and conferred at I.G. pally hydrocarbon field, Class Hague, Netherlands. confer- At this patents, important fields, in other ence parties made a number formal useful but also hydrocarbon field. relationship. changes A reci- Jasco 1,000 S.I.G. issued shares of stock at $100 equi- tation was the was made Jasco per share. This was divided Stand- % patent rights par- owner of all table % ard and profits to I.G. were S.I.G.’s Oxidation, Oppanol, ties Paraffin $11,000 year, limited per royalty but its Arc, Acetylene processes. Buna I.G. paid income was to be to I.G. and the Jer- its stock in agreed to De- transfer Jasco sey group roughly proportion to their Agree- velopment. terms the Jasco holdings. agreement sto'ck This put was royalties providing for division ment be- into rights effect pat- parties percentage on a tween the basis assigned ents were to S.I.G. scrapped in favor of a division signed In territorial basis. agreement I.G. an Jasco’s released pursuant royalty which was created. The Jasco Jasco return, Agreement. processes new was concerned of both Jasco patent rights all its assign I.G. producing and the for group processes outside products chemical the United petroleum, four crude thought bitumen, nations natural gas. natural States In this up Presumably suit Germany. at connection with be war with Gov- Development ownership retain and to the States time when United was On. processes stepped picture. nations ernment control of in these into the 25, 1942, P.M., Alien ownership through its and March 2:15 stock at upon plaintiffs, Property whatever had under the Custodian served amended, which, Agreement. taken a order later vesting Other action also Hague Ringer, Dr. now one covered interests Conference. all the representatives, him brought States I.G.’s suit. Later the United day for A assignments in blank all Class District for of New Court District been as yet G. ac- S.I. decree entered consent S.I.G., signed brought day for some of Class the United States present as already S.I. others G. S.I.G., S.I.G. for signed to the Class B all violation antitrust laws. Acetylene patents Alien Property party Custodian was a to- Oxidation, Arc, Oppanol Paraffin suit and decree. consented Howard, processes. provisions, de- Among he delivered to decree These De Jersey’s representative, president Four-Party Agreement,, unlawful the clared vice-president memorandum, velopment Hague Hydrocarbon- of Standard. and a Synthesis exceptions Agreement, and, at the There was discussion some also stock, here, Hague regarding arrangements USAC Conference material between. formal but there is no evidence ac Jersey group. enjoined tion thereon conferees. by the there performance defendants further *6 exchange substantially contemporaneous of of agreements accounting these from Development, cer respect receipts cables between I.G. and to the sub- own changes formal in the ject tain were made agree- matter by covered the In the ership place stock. USAC ments. Further the the decree ordered agent, by new held as 850 shares there defendants to transfer certain men without were issued Jasco, shares suit here to which S.I.G. and were Development the Later agency. indiscriminately. tion of to issue licenses In the “whatever purchased from I.G. $100 Property the Alien con- Custodian you in the 170 may have” title prop- sented to execute further transfers of [I.G.] originally which held erty provisions shares S.I.G. had necessary to carry out the for I.G. The also decree. contained' decree declarations that it prop- left undisturbed Hague memo- After execution the the erty rights of the defendants and randum, paid pledgee of Development to a rights- the Custodian by unaffected $146,000 stock 5 shares I.G.’s Jasco terms decree. own funds Out out of I.G.’s funds. 1944,plaintiffs In commenced this action $4,000 paid Dr. Jersey group 9(a) Trading with the § in New Duisberg, representative of I.G. (cid:127) Act, Enemy 50 U.S.C.A.Appendix, 9(a), § de- Thereafter the shares were York. alleged property. recover The case Jersey. shares trans- The were livered in 1945 by Judge was heard Wy- Jersey certain in trust executives ferred zanski, by sitting designation; and his final (In considerations. for domestic business in the action July decree entered designed com- they to evade fact were group 1946. Under it the recovered co-operative contracts on other mitments legal stock; seized S.I.G. title to concerns.) For rea- similar with domestic stock, subject duty the seized Jasco reassignments of the S.I.G. sons reconvey upon pay- it to the Custodian I.G., reassign- and these were secured $4,000lien; 255 ment of a of USAC shares another trust to official of ran in ments equita- stock; legal title to and certain group. , patents; in the ble interests Class Steps States. the United broad by equitable certain interests in the Class the transactions which S.I.G., patents; Oppanol, and certain outline Jersey group by licensing powers in the and limited on plaintiffs’ appeal based thorough analysis by The careful and little, ground too recovered the court. As a matter fact the district plain- appeals while defendant judge because the pains took buttress his decision tiffs recovered point too much. exposition very detailed grounds. his Realizing agree- secret Findings. 3. The The District Court’s ments of the kind involved would not be case, most crucial Dis- in the issues disclosed direct evidence confes- them, trict find- Court viewed turned sions, he set forth the factors led ings intentions acts him to understanding deduce the real below, parties; and, develop shall we parties. Thus, first there was much at- conception. entirely agree with this tempted concealment Hague at Confer- disposition Our legal issues various ence. The text of memorandum on is such that broadest the final result —in its Hague reached contained important aspects and more stand Jasco —must representations type false likely of a findings upheld. fall as those public mislead represented authorities. Court found District that of transac- Jasco, corporation tions was soon detailed above between I.G. and to be apparently owned, had Jersey group, place American taking before greater much than Hague good it ac- Conference were had faith. tually Moreover, had. memorandum apparently The formal creat- interests incomplete, itself was making no reference ed documents were intended obligations Jersey group assumed ones. did the substantial Nor regard contemplate licenses of read- substantial justment regard outside the field except regu- after war Oppanol distribution of lar Fur- course of normal business revenues. transactions. ther, Howard, representative effect, however, court found in Jersey group, contrary prac- to his usual agreements Hague Con- reached at the tice, incomplete reports sent written ference, contemporaneous agreement superiors of the conference to his stock, for the transfer of USAC and the personal unusually notes he retained were steps implement taken to them made sketchy. stand, Howard, On the witness *7 change substantial relative testifying concerning Hague Confer- parties. The found interests court ence, was, opinion court, not that were designed sham transactions a credible In plain- witness. view appearance to create an owner- necessary tiffs’ reliance tes- Howard’s ship interests which never- timony, without which their case could not continued regarded theless to be by the stand, this attitude the court who heard parties I.G. parties intend- owned. him was itself decisive. ed that completion after the of the war and resulting disappearance Second, danger respect took I.G. action with of United States Government controls contrary S.I. G. to its natural properties formally would be probable returned to genuine course if changes prewar relationship resumed. by parties. intended were In Four-Party Agreement sharp findings Like other of the District distinction drawn was between situations Court, finding this crucial of the intent and which S.I.G. had title and those in which purpose of these supported transactions is only G. had an S.I. license. exclusive Evi by fully adequate evidence, and, being far dently parties, I.G., or at least thought erroneous,” from “clearly accepted will be important. such a distinction Yet 52(a), Rule us. Federal Civil Rules Hague appear was made that had Procedure, 28 U.S.C.A. following section compensation permanent without as 723c; Clark, v. 2 Cir., Brassert 162 F.2d patents it not signments" obliged was 967. The attack it with ut assign. vigor, most asserting first that it is we Third, conclusion. While think sweeping readjustments more financial that, basic very respect than it is not important made with were without Jasco it, we characterize agree how usual careful consideration of results showing ing financial intentions of parties. was no There original Agreement govern. or at should Hague made at the Conference revenues trial that the division of complete This does statement of not division of the territorial sup judge all the factors listed corresponded adopted Hague at The port finding his nature of the the sham original division revenues Hague Jas- agreements; purposes of but for Agreement. Oppanol Agreement co or the sufficiently review it indicates the nature indi- Such absence of financial estimates developed the case before him. judge cated to district arbitrariness other should be added were also that there designed temporary. arbitrari- to be way he- tending factors the same by the fact further shown ness was empha expressly ignored or either did Iraq was parties when the discovered reports were size. Of the former kind Iraq Germany, trans- was not at war with repre superiors by made to their the I.G. Development’s territory I. ferred from military sentatives discovered consequence that the G.’s. The net was war. authorities after the These earlier rich financial to I.G. of returns because considered: them; not seen transactions in evidence and were were not argument but at least an could' presumably nonexistent. be made that were admissible as coconspirators, statements of under the Fourth, gave Hague negotiators theory of v. cases such United States possibility of careful consideration to the Manton, Cir., 834, 839, 107 F.2d certio changes in and wrote future their decisions States, 309 rari denied Manton United changes specific provisions concerning such U.S: Of L.Ed. 1012. S.Ct. agreement they into the reached Jas- other known the latter were instances arrange- Concerning co. the territorial practical deception by Jersey as to the ment, superiors Ringer reported Dr. to his employed, actually devices con such as clear Howard that he had made it interests, on at the English cealment from benefits I.G. insisted that financial connections, war, Jersey’s set of German both co-op Jersey’s or like concealment readjustment. changed further by the He erating companies through domestic con pro- reported rejected that Howard veyances made to the trustees—the posal rendering for a of annual accounts latter I.G.’s thorough cooperation, and settlement of excess amounts even to the extent of re-execution of its as capable being easily too seen signments to conform plan. Then, continued, report through. his words, judge pains took to con readjustment proposal drawn so that a fine himself to evidence he considered un *8 revision of the division of countries challengeable. Though separate place the take financial either if results for. ly specifically attack each fac the of party, by measured the terms the of by court, tors stated the per we are not Agreement, adequate. should not be At the pervasive of suaded substantial or er trial did Howard not at first recall that processes ror in the court’s or deductions- proposal for such territorial revision Moreover, is the over-all deduction Hague La- been the Conference. upset; this, think, must be parties regarded ter he did recall it. The wholly rational under the circum Hague ambigu- the memorandum itself as great stances. Here we have two indus question right ous on the whether or not a organizations trial which had shown their to the division of same revenues many ability years perfect over to act in original Agreement le- could be co-operation with legal devices flexible report gally enforced: In a to another offi- adapted changing political industrial or Jersey, recognized of cial Howard portentous pressing circumstances; “possibility legally of enforcing the re-ad- adjustments against -im need to make justment provision” finally written into by the pending war; crisis foreshadowed Agreement. Hague testimony his relations, adjustment formal of positions, qualities, disposi- finally including he took inconsistent agree- unusual various
025
justice dissenting,
indi-
the decision of
small
reversed
I.G. v/ith
tion of
Custodian,
contrary
the district
in favor
court
of the
(quite
rect
financial
returns
uphold
right
On
of
to sue.
customs)
previous
habits
certiorari,
argued in
In-
the case was
the Su
apparent.
and furtiveness
concealment
May,
preme
hut
now been re
Court
has
adjudication be-
major
deed we think this
reargument
stored to the docket for
quite just.
low was
Finanz-Korpora
Clark
Uebersee
fail.
As Ameri-
Right
to Sue.
4. Plaintiffs’
1749. tion, A.G.,
like order for
S.Ct.
67
right
plaintiffs’
corporations,
can
companion
reargument was made
property from
their
bring suit
to recover
Clark,
Corp. v.
of Silesian American
case
face,
is, on
within
the Custodian
on
of our decision
S.Ct.
review
9(a)
authorization
§
Markham, 2
Corp. v.
Silesian American
Act, 50 U.S.C.A.
Trading
Enemy
with the
Cir.,
fur
have
F.2d 793.2
Nevertheless,
ques-
9(a).
Appendix, §
the briefs
nished
on the issue
us with
in view
right arises
as to that
Court,
Supreme
presented
and these
to the
Act, 50
5(b)
391-1 amendment
§
helpful.
5(b).
U.S.C.A.Appendix,
Previous
§
Act,
amendment,
7(c)
U.S.
opposing points
of view
stated
§
C.A.Appendix,
7(c),
Ap-
had authorized
Court of
opinions
§
in the two
on
property
be-
vesting
owned or held
peals
plain-
in the Uebersee
case. The
nationals;
enemy
1941 amend-
half
point
tiffs’
view is
that
amended §
5(b)
vesting
ment
5(b)
authorizes
§
not to
treated
an amendment
is
foreign
nationals whether
9(a),
by implication of
but
that
stat-
§
claims
enemy or not. Defendant
together
given
utes must
read
and each
necessary
implication de-
considered,
amendment
effect of the
So
effect.
9(a)
stroyed
right granted
to na-
government
§
change
enable the
in law is to
foreign
friendly
powers to sue
tionals of
cloaking
meet
the real evil
were
property.
If
to recover
seized
apparent hold-
enemy property interests
so,
proceed
plaintiffs’
here
right
powers.
friendly
Sei-
ings
nationals
nationals,
might
brought
question be-
into direct
permitted
zure
E
Exec. Order
upon
subd.
cause
return
§
can
secure a
who
then
note, CFR,
(iii),
95a
Cum.
U.S.C.A.
genuinely
§
showing
order,
Supp.,
6 F.R. 2897.
That
pending,
title
While their
own.
suits
Trading
purposes
with the
some
under the
prima
property would be
to the vested
facie
Act,
Enemy
includes
definition
Custodian,
5(b).
pursuant
§
persons
foreign
extent
nationals
pro-
amendment
Limitation
thus
directly
indirectly
acted
interpretation,
urged
a natural
cedure is
benefit,
behalf,
foreign
of a
na-
in view of the constitutional
particularly
tional.1
interpretation
attendant
an
difficulties
away
steps
argument
amendment
took
are two
Thus there
foreign
friendly
powers
Taking
of nationals
reached.
before its conclusion is
remedy
By
7(c),
order,
of claimants
up in
clear that
there is
sue.
§
exclusive;
Act
is made
be— under
the Act which must
ambiguity
*9
interpreted
amendment
if thus
will be—resolved
apparently
hence
soon
confiscatory.
subject
Uebersee
to attack
Supreme
Finanz- would be
Court.
A.G., Markham,
Moreover,
81 U.S.
Custodian has
to se-
failed
Korporation,
court,
Congress;
in-
313,
legislation from
284, 158
F.2d
one cure
App.D.C.
Notwithstanding
interpretation
1
2
Though
some
not make the
defendant does
support
possible
full
Cus
argument,
ease as
for
of this
it would seem
con
3038,
definition,
position,
that,
Yale L.J.
it
todian’s
cf.
this extensive
tend
go
far;
only
enemy
plaintiffs
so
for
issue
after
docs
became
nationals
question
claimant
war,
a
whether
since
con
the outbreak
court,
making
remedy
some
thus
there
some
of I.G. assets continued
cealment
corporation
unjustified
argument
aof
the refusal
an
would not re
after.
Such
scope
restricting
9(a).
stock on its
quire
books
transfer
§
Custodian.
buttress,
deed the
provi-
in 1946
a
ground,
Senate
struck out
ford an added
a further
sion from a pending
property
order “to elimi-
bill in
for the refusal
to return the
proposal
right
nate the
equi-
a
cut off
below
substantially
found
to be
friendly foreign
tably
for and ob-
that of
see how
national
sue
we do not
property
tain
return
Sec-
Un-
of his
beyond
this.
assists
defendant
1839,
9(a),”
Rep.
Cong.,
79th
Sen.
No.
foreign
der the
a
Executive definition of
Sess.,
2d
national,
and the
amended be-
pertinent,
bill as thus
so
it in-
far as here
925,
August 8,
came law on
60 Stat.
1946.
persons only
extent”
cludes other
“to
50 U.S.C.A.Appendix,
they
33.
directly
indirectly
§
that
acted
for
foreign
the benefit or on behalf of
na-
Defendant, however, contends that this is
plaintiffs
acting
tional. Where
were
important
too
give
limited effect
to an
themselves, as the
Court found
District
amendment,
power
granting the President
respect
purchases
before
agency
per-
to vest such
in an
nothing
we find
provisions
to bar
son,
“upon
such terms and conditions
Accordingly
suit.
we
may prescribe
such inter-
President
application
conclude
asserted
held, used,
or property
est
shall be
admin-
principle would
change
final out-
istered, liquidated, sold, or otherwise dealt
this action.
come of
with in the
for the
interest of and
benefit
5. Unclean Hands and Antitrust
says
of the United States.” He
that there
urges
plain
Defendant also
Violations.
difficulties,
no
are
constitutional
because a
generally
must fail
because
tiffs
do
friendly
claimant of
right
nation
ahas
into
come
court with clean
ac
hands
just compensation in
recover
the Court of
is, by
tion which
9(a),
the terms of
taken,
§
any property
Claims
re-
type formerly
equitable.
denominated
7(c)
only
striction of remedies
is
§
Cummings v.
Bank
Deutsche
Disconto-
und
“property,”
those for return of the
not of
Gesellschaft,
118, 57
U.S.
S.Ct.
use,
compensation for
that his ad-
359,
927
belonged
stock
to Standard when vested
unlaw
patent for
using
patentee
to a
his
it.
Standard is entitled to recover
Precision
See also
ful restraint
trade.
Main
Automotive
Mfg. Co. v.
Instrument
The
The Custo
USAC Stock.
7.
806, 65 S.
Co., 324
Machinery
U.S.
tenance
425
in
shares
dian vested
himself title to
title
993,
has
judicata
a determination
or even
provision are those denominated Class A
ownership
stock. It
was ob
5.1.G.
viously
part
identify
of an
intended
judgment
II-B
ing label.
“does not reside
Article
dealt
patent rights
I.G.’s
portions.”
recitals,
in mandatory
but
Germany
outside
were useful in the
Tanney, D.C.S.D.N.Y.,
hydrocarbon
Eckerson v.
field,
235 F.
but also
sub-
useful to a
415, 418,
Cir.,
degree
affirmed 2
929 Jersey industry. The agreed chemical granted patents I.G. (outside control patents group ex- obtained itself for the life to S.I.G. operational field of I.G.’s right Germany) in its royalty-free license and clusive far technology were patents useful others, far but so license which, pat- of its ov/n and if used ahead A schedule hydrocarbon field. it, II-A, serious economic might accom- have caused it ents, in Article qualified as per 20 cent granting By difficulties. panied grant. covered The proceeds itself it assured Class interest in S.I.G.’s provision those denominated are co-operation in- of I.G.’s continued B S.I.G. development its business. terest provided that IV-A and IV-B Articles Four- proceeds Subsequent signing by S.I.G. distributed realized Agreement, Party to I.G. and order: I.G. to Standard following amounts cent; expenses; general assignment per scheduled Class 20 S.I.G. roughly patents, large remain- $11,000per year; A and later made S.I.G. a Jersey separate assignments number der to a named member agreement patents patent applications group. the A XVII made the Article years by two eighteen after schedule. terminable years’ party. either written notice On Court ruled these facts District pat- provided that on termination also that I.G. to S.I.G. surrendered licenses, ent with certain ex- title to those Class A either ceptions, retained generally specifically assigned prior them, party should holding but that no
then September, (Assignments after give bound to technical information were, course, part general date patent regard rights. surviving to such Hague title-shifting false scheme of provisions of other articles pat- Conference.) As to the Class agreement are not material to issues patent applications, ents court ruled present case. I.G., but title remained in require field, equity had a to con- hydrocarbon roughly I.G. vey I.G. embraced the oil title. The court ruled that gas natural indus- tries, the field title to the in which surrendered Class equitable group’s certain far-flung empire op- but that S.I.G. had principally licensing, royalties, and other erated. Chemical fields to and often interests in akin overlapping hydrocarbon under them. field preserve in which similarly the bulk of the visualized problem must be If the far-flung empire operated. By this unit, are various there in terms of title as divided between precedents cited the District Court which themselves the beneficial of owner- support tend view. Littlefield v. ship Germany outside of I.G.’s 205, 219, 222, 205, Perry, 88 U.S. 21 Wall. which related to Subject both their fields. 577; Mackenzie, 22 v. L.Ed. Waterman 138 participation to I.G. revenues, S.I.G.’s 261, 334, 923; 11 U.S. S.Ct. 34 L.Ed. the Jersey group was to enjoy fruits of Corp. C.I.R., General Aniline & Film v. 2 ownership of both classes of in so Cir., 760; 139 v. Hes F.2d McDuffee they pertained far hydrocarbon tonville, Cir., Co., M. & F. R. Pass. 3 162 field; I.G. was to enjoy those fruits outside 38, 39; F. Universal Oil Products Co. hydrocarbon field. Co., Refining D.C.Del., F.Supp. v. Root part bargain ap- received from the Refining Root Co. v. Universal affirmed proximately $35,000,000 Co., 186; Cir., worth of Standard Products Oil F.2d con stock, plus approximately $275,000 tra, Corp. ac- Sterling Six Wheel Motor dividends; crued 20 per California, Cir., cent share in Co. of Truck F.2d royalties; operative SJ.G.’s and an rec- 568. But we do feel that must be so ognition (in closely another agree- important question regarded. tied-in ment parties, between the two prop known as whether interests the Division of Fields Agreement) of I.G.’s of sufficient erty interests substance that preferred position over group recover from the them Alien *13 930 great con- their nature against latter’s substantial
Property Custodian “executory value, rights both obtained merely monetary tention that are substantial classify plaintiffs’ Four-Party or de- are Agreement contracts.” To of more form enough one or some regarded fendant’s interests here under “title,” “equitable categories of interest, of the property property,” “contractual action. judgment servitude in in this and have sue problem. The right” does settle the n 10. Decree the Consent Effect of be fitted into rights parties can of both consent Patents. When the S..I.G. categories. Indeed, various of these framed, the S.I.G. decree was “property” or use of the inveterate labels licensing patents of both classes exclusive group denoting a symbols, “title” as hydrocarbon field royalty rights relations, rights legal “bundle” of other Germany; li- outside I.G. had an exclusive understood; we now is when well it rights out- licensing royalty cense beyond ques- these forms advance hydrocarbon need field. side We degree, of number and value tions of abrogation great here determine how rights, we come to solution United rights Jersey group of the Restatement, problems 1 such as this. See by prosecuting might have States secured 27-30; Hohfeld, 1936, 10-12, 3, 4, Property, non- against action to a its antitrust 1923, 3, Conceptions, Legal Fundamental United termination. For the consensual 746; 710, 12, 712, seq.; 67 et 26 Yale L.J. accepted decree consent instead States 729; Cir., 721, C.I.R., 2 28 Id. Rohmer v. grievances a final settlement 61, 64, 153 F.2d certiorari 328 U.S. denied against these which arose 862, 1632; 1367, 66 90 L.Ed. Morris S.Ct. Four-Party Agreement. then Finality Plan Bank York v. Industrial of New general principle would follow from the Schorn, 540; Cir., 538, 2 135 au- F.2d judicata consent decree is res Clark, Covenants, 2d thorities cited Real Corp. included. W. issues O’Cedar F. v. 1947, 4, 30, Ed. 156. Co., Cir., 363, cer- Woolworth 7 66 F.2d rights patent The to recover Midway tiorari Chemical v. denied Co. license, rights royalties, to to transfer 441, Corp., 666, 291 U.S. 54 O’Cedar S.Ct. patent many in a are some of the elements 1057; Mfg. L.Ed. Pick 78 Co. v. General in enjoyment making up title. The 639; Corporation, Cir., Motors 80 7 F.2d parties part terests both are in least Sylvania Hygrade General Elec. Co. v. type equity a former court of D.C.S.D.N.Y., 476, Corp., F.Supp. 61 491. enforced; certainly would have some Moreover, finality as to particular origin contractual in was made grievance more considered, category nature. In whatever decree. In sec. terms VIII of the however, pro would Department decree the against tected holder title to against take further action Justice against notice, patents or third plaintiffs is reserved. But from this reser- Edison, Phonograph v. New York Co. vation, upon agreements spe- action based C.C.S.D.N.Y., 606, 2 600, F. affirmed cifically excepted. named in Ill is sec. 404; Cir., 144 F. Werderman v. Société Agreement is Four-Party specificallynamed d’Electricité, 246, or Genérale 19 Ch.D. sec III. bankruptcy. trustee in the holder’s Waterson, Snyder 2Co., re Berlin & Property Alien Custodian Cir., patent F.2d divided decree, of those consenting was one Agree parts by two Four-Party into he, it, like the expanding those to a new in ment were modification or nonmodifica bound very technology; rights. their value dustrial course, Of if these group filing great; plaintiffs, considered that after the consent $35,000,- part it excess of used their interests was worth got laws, price paid; do the antitrust decree that was to violate part what value I.G. set on the modified force discontin know could be that, think such action. United retained. We because uance of States
gg] royalties 52 S.Ct. ents for the duration free of Co., Swift & U.S. subject payment 999; emergency the war Co. v. Standard Coca-Cola L.Ed. Cir., royalty Co., thereafter. Bottling reasonable 138 F.2d claim violation of new indis requirements *14 Save as to the the extent that Agreement. To Four-Party provisions do not licensing, criminate therefore, is applies, decree consent the the rights in previous diminish S.I.G.’s the present of status of the determinative to is patents. S.I.G. entitled G. These S.I. patents. interests of the in the S.I.G. Unless recover from Custodian. .the the by the were increased decree specific of con provisions the to decreased, is entitled Custodian’s of its light sent decree must read in the recover more. put an general purposes. were to These co-operative trade end restraint of Court held that certain The District to a practiced Jersey group and by and the in S.I.G. I.G. extent the Custodian’s interests licensing purposes to the all patents by insure consent de were decreased the applicants patents all controlled to In Class A the decrease cree. nothing by substantially these two. That destruction of virtual amounted by shown rights. more was is royalty licensing than this intended Custodian’s clauses sweeping language so patents, was Class B S.I.G. explicit making reservations extensive. The District Court relied Protecting incorporated the decree. into the decree as establish several sections of part: Jersey’s rights, provides in sec. VII ing reduction. III declares the Sec. shall contained in this decree “Nothing Four-Party Agreement agree anS any right, or in affect or enjoins diminish title illegal and ments the there defend successors, defendants, terest of their further any ants from of the performing assigns or in or or subsidiaries provisions agreements. those IV Sec. any presently licenses existing (1) requires them to exist discontinue all patents, patent applications, as I.G., excep ing relations with certain patent signments or of such of such enjoins here. tions immaterial V(3) Sec. marks, names, applications, trade trade respect accounting them to I.G. in corporate Protecting shares of stock.” any receipts subject matter from the provides rights, XII Custodian’s sec. illegal agreement by declared the decree. Property part: consent the Alien “The Property XII recites the Alien Sec. Custo entry of this Custodian to decree dian’s consent further “to execute such bound, however, agreement shall transfers to S.I.G. or Jasco Alien not affect such further may carry necessary provi out the any Property Custodian to or the decree, including provisions sions thereof, rights therein, proceeds limiting royal the decree prohibiting remain unaffected terms of this de ties providing under those cree, right, title and all such interest compulsory licensing under them.” Property Alien Custodian in provisions, These against considered proceeds property or be thereof as background, purposes, and results Property tween Alien Custodian and suggest propriety do of re expressly the defendants is hereby ducing Custodian’s interests in the reserved.” patents. injunctive provisions G. S.I. provisions accounting against continuing Certain the decree have I.G. and relationship' more or reference Four- specifically less I.G. men Party Agreement patents. They name. not purport the S.I.G. I.G. do IV(2) governments, directs the there- relations with any defendants Sec. forbid to, right to, all agency title succeeds to I.G.’s interests prohibition power, and interest in both Class and seizure. So also the V(5, 6, Jersey’s provisions 7) Sec. di- execution Class Agreement applicable under these Four-Party rects and the between applicants pat- agreement use to that should not be Custodian, decree was His participation seized. he While extended to purpose, quite different actually -for rights, he a formally to I.G.’s successor his express reservation indeed obviously in different situation appearance as value; His XII for he is in sec. indicates. ordinary assignee for provide necessary seeking destruc- successor agent government of a against a group Under defense for the power America. tion of I.G.’s foreign court Jersey to suit I.G. in payments by possible later those circumstances be- agreements nonperformance of the of an for fulfillment hardly the Custodian are part of early In the payments to Nor two. tween the calling documents quickly taken purpose subserved action was the decree *15 hurriedly avoid draw- situa- We contrary holding. at a should It aimed drafted. was Jersey some- of the irrational conclusions from ing tion in which the members wrongdoers, monopolistically wording. We conclude times unartful group were interests the restraining trade. States had therefore that Custodian’s The United them, but diminished against were not an action the S.I.G. instituted accepted decree, judgment that the background tne consent and war the the permissible modi- accordingly It is not a action be decree. consent that the facts Gov- inference from these fied. to ernment donate the intended to agreement upon the Custodian’s Acting licensing group very group valuable further XII execute transfers in sec. to royalty rights virtually a for and as reward the de- property, District Court ordered their wrongdoing. pat- transfer fendant certain interests to carry S.I.G. to out ents to and Jasco negatived an inference is further Such decree. The purposes of consent to Negotiations leading other factors. jurisdiction to question court’s do carefully long and con- the decree were transfers, think order representatives of Anti- ducted between purpose its discretion. were within Department of trust Division Justice was sought effectuate Court to the District plaintiffs. counsel for freely ob- patent licenses S.I.G. to make Property had Alien Custodian Officeof the purposes point from for all at one tainable Emergency the Office for created conclu- with our Consistent one licensor. only two Management by Order Executive parties in of the S.I.G. as sions filing weeks before of the decree. Exec. by the be served purpose will patents, this 9095, CFR, Cum.Supp., Order 1121. Even li- Custodian’s grant negotiators if the Department for the power censing in the S.I.G. knew the impending creation Justice conformity provisions with the exercised Office,they could Custodian’s decree. ac- the consent As modified in known before creation exactly what views, with our the decree will cordance purport Custodian would duty exclusive give to S.I.G. language vest. The inartistic used should licenses under interpreted as showing an intention royalties. applicants reasonable all give away property interests valuable granted for so far' licenses are use in the Custodian. Nor it to be vested field, pay hydrocarbon S.I.G. shall in the easily inferred that or the de- the court portion over to the Custodian counsel were led so fendant’s to understand. receipts royalty which would have been appointed was Since Custodian so re- obliged pay to I.G. the terms of decree, he cently very before Agreement. Four-Party Licenses for any, part, negotiations if small hydrocarbon field will use outside opportunity exactly to ascertain little what only upon terms directed granted acquire interests he was his Custodian, and S.I.G. account will very questionable receipts vesting order. for on such Custodian expenses. oblique provi- licenses, understood such less actual he whether Ill, accounting provision of the IV(1), decree modi- IV(3) as secs. sions purpose just taking away what he fied no violence him does
ggg any panol, agree- agreements. limit those no consent for it does not If reached, pass li- way patents for ments availability censing all fields. Jasco. agreement After the signing Jasco Process Patents. proj- experimentation conducted substantial claim interests Plaintiffs group. ects I.G. and processes within field. the so-called Jasco develop- informally submitted to Jasco Jasco, corporation Acetylene Paraf- process, ment the Arc per Development cent each SO held proc- process, fin Oppanol Oxidation stock, came into in 1930 existence ess, parts process. Buna Sub- Agreement. Under the terms the Jasco sequently respect made contracts in corporation the Jasco process Oxidation cer- Paraffin exploit proc- develop formed new parts process tain Buna with outside parties, employing esses of both start- business firms. the District Nevertheless ing petroleum, material crude natural bitu- found, evidence, Court sufficient men, gas. or natural actually acquired no commercial *16 agreement II provided Article of that rights processes. in con- these two that, developed party either new when a dealing tracts with it in outsiders was what field, process chemical within should it might get from did ac- I.G. Nor Jasco give party in which other four months quire Acetylene any property interest in the process to elect whether or not the should process. Arc I.G.-originated patents The developed by pro- be Article III Jasco. involved in three processes these were com- that, developed vided where Jasco pletely owned I.G. on the seizure date process point exploita- commercial of therefore in vested the Custodian. tion, company, prelim- originating after consent substantially The decree did not inary agreement regard- had been reached decrease the Custodian’s interest in these ing process, give should exclu- Jasco patents, for the reasons set forth in the sive licenses and licensing rights outside rights discussion of his under the S.I.G. Germany. provided, however, III Article is another There reason also. that, precedent as a condition to the grant Though rights some of in Custodian’s rights Jasco, exclusive licensing might regarded Class parties between the five on Four-Party Agreement from the derived points required. was These included defini- subject and hence infirmities process, tion of the marketing arrange- document, of that the Custodian’s in ments, orig- the amount of royalty due the processes are derived Jasco party, inating which party control was to any illegal agreement. They are those management process, future and dis- which I.G. directly obtained through position existing obligations contractual employees from the patent United States party of either process. bearing on the offices. Hence cannot persuasively provided VII Article should argued that the consent decree limits these
try agreement, to come to in and that case rights because illegality source. of failure of agreement the decision should carry To out rest with the this party purpose have been consent given entitled was process control of the bare Jasco to license Division of in Agreement. processes Fields for the Custodian’s account. Apparently The District Court concluded, right has never disturbed, this agree, Jasco court below decided. agree We with the here gained any patents in interests District Court that is entitled en- Jasco solely by agreement. this respect With joy right. patent rights, only action the bound themselves negotiate. take 12. Oppanol was to and Allied Proc- negotiations If the agreements Oppanol led to ess Patents. grant- was the one Jasco ing rights Jasco, process coiicerning would be which a formal agree- derived, were in the Op- case was ment reached I.G. and the Jersey as-
group. was It was Oppanol Jersey interests. memorandum coun- signed sumption signed, Court found court in The District de- approved, provided that for that under “it sel the United States its terms was * * * various (1) ‘Oppanol of Ger- cree for transfer providing outside group to many brought Jasco,’ (2) of the interests ‘Standard’ that, since urge corporation here- is meant the now [by which Jasco. the court ‘Development’] have the consent decree issuing tofore called was to stock, exploitation ownership ‘the control commercial error as Jasco * * * industry, con- the suit District Court oil concerned,’ required reconveyance so far trol as other uses Development, (3) Jersey-originated patents Company Oil ‘New [Standard of] Jer- subsidiary sey’ ‘to question wholly without which is owned use compensation Jasco, They this an un- for name Standard. but therefore industry,’ Custodian. oil “windfall” own use of in the warranted (4) dividing instead revenues complaint The decree below dismisses the pat- Oppanol licensing by lack of these “for recovery proportion ents in % % provisions jurisdiction.” But the broad Development provided “suit 9(a) the Act authorize a § Oppanol Agreement, revenues money equity” “any interest” special (a) subjected whereby to a scheme transferred, property “conveyed, or other royalties from li- received delivered, paid” assigned, to the Cus- Oppanol censing were to be distributed Yz todian order wherein court *17 Development (b) the Y¿ to I.G. and interest transfer a claimant “the paid by Development were royalties to be therein to shall determine which court that go not to but to S.I.G. so Jasco surely is entitled.” said This claimant ultimately % to I.G. distributed adjustment authority cover sufficient assignees of approximately to% parties prop- rights of these between the Delaware.” Court erly before The District the court. seems, however, to rested refusal I.G. and the Under terms both these Jer- upon feeling comity or un- to act some group substantial interests in sey secured willingness interfere with process. Pursuant the acts of under this decree, entered the rights of the court which had consent decree. all the the consent think, concern; This, Oppanol patents were we was undue was plaintiffs in the it complicated all entitled familiar with details of this is now transferred to Jasco. Jasco question, which had licensing rights in never been before the royalty to recover Op- present New in true patents, in the court in Oppanol granted setting. properly It was the fitted We are content court panol memorandum. by decision. they were left make these interests as leave Court. District merits, Nevertheless, on the that we feel not, in equity good con- Jersey-Originated Jasco 13. The science, pro- consent decree entitled to such relief. The certain Under the Patents. rights requiring four visions the transfer Jersey-originated question corporation only to a proc- half processes and other so-called Jasco by product of an owned were not With transferred have been esses Jasco. error, con- Oppanol so far these under the exception of those part misrepre- it On their was a possessed cerned. owned never process, I.G. sentation, their part of scheme to deceive patents prior to consent these already government. had Plaintiffs urge it is therefore that Plaintiffs decree. represented falsely valuable rights be transferred inequitable these Buna, Acety- covering who, say, they entitled Custodian, Arc, processes. seen, Paraffin Oxidation lene had. we have As to what misrepresentation they sought By a recitation decree contained consent part the Custodian completely wrest from stock was owned complete processes ownership of fore not cured by these ac- Government’s properly ceptance secured Custodian had of the consent This decree. by they penalties' seizure from were not a case of affirmative visited part leaving content with wrongfully acts; obtaining them for their rather it is rights; they they wanted mis- them all. So themselves situation represented that all stock was have created. As leave with we Jasco’s them, owned and thus eliminated—until I.G.- royalty rights in the discovery vesting ownership originated half obtained —the By United iií coupling States consent also so leave Jasco. misrepresentations these plain- with sec. Ill of property just as settled perform- consent decree tiffs’ enjoining the decree. and desires in that agreements ance I.G., plaintiffs Lauryl 14. The Amine and Other thought they destroyed successfully below, AD Patents. Under the decree processes. Custodian’s eight S.I.G. recovered in one misrepresentation Moreover the of Jasco’s application class, in- AD the so-called stock ownership wrongful only Lauryl patent, rights cluding Amine to the consent decree. a violation It was equivalent to those it recovered the Class Jersey’s statutory obligation 7(a) under § findings The court’s Enemy of the Trading with the Act and recovery, support fact do and in- Order, 8785, Executive Exec.Order June deed evidence record does not 14, 1941, CFR, 12 U.S.C.A. 95a note, 3 § finding warrant justifying a re- Cum.Supp., 948, 6 F.R. Treas- and a covery. The court found that the ury Regulation, 130.4, CFR, Cum. § customarily covered AD patents sepa- Supp., report 6 F.R. negotiated rately agreements. found foreign-owned stock Jasco.3 question also it was doubtful wheth- True, arranged the consent decree was Amine, Lauryl er particular, came with- counsel; eminent charge of Four-Party Agreement. If AD *18 misrepresentation part expressly on their is special been treated as all, disclaimed the defendant. But after problems by Jersey, I.G. and could they principals it is the who are involved properly have been by the treated court wrongdoing whose concerns us. Now that the manner as the patents. same deception they has been out, found special since the understood that appeal to the conscience of a to free court required agreements rights were to transfer pitfalls them from the created that de- Jersey, Jersey from I.G. to show had to ception. particular point On this we think agreements specifically rights transferring the defense unclean is hands well taken. any. if it was recover goes general It not to plain- the conduct of tiffs, regard but to their actions with The showing made to seven the as very issue. plain- This misconduct of application was that wiped out, tiffs was not previous as their physically were delivered to for trustee was, by acceptance by misconduct Jersey group, along previously with un- United States consent decree. It assigned patents, as a result of the prevailed throughout procurement of Hague Conference. But the District Court temporary the consent and its suc- assignment effect found in that this did cess written into recitals de- create new substantial in Jer- Their cree itself. there- wrongdoing sey enlarge possessed. it already fact, good ground enemy. there seems of its an stock But the Cus- misrepre- position for the contention this todian has taken this sentation, legally yet considered, vesting to Jasco in his order. Nor has Specifically, case, extensive. more 5, his counsel § done so in this either E(ii), subd. Exec. Order su- on this issue on to sue— pra, possibly because, alia, Jasco itself could be viewed as a inter the substan- foreign national, in view of appar- the sub- tial results would action ownership ently greatly, stantial all, more than the not be if —much affected. regulation— referred later in the 25% by- pressed case, brought A course assignments Class reopened the find- Custodian, plaintiffs, cannot be effective were ing each rationale, because new document. the District Court’s Jer- right to such equitable sey already had an upon the defend- It follows that therefore assignments assignments. Otherwise appeal modified ant’s the decree sham parts merely have been no Plaintiffs should have (1) follows: Lauryl regard Hague. With of The stock, e., lien recovery i. no shown, Amine, assignment was the same Duis- $4,000 $4,000paid for for agreement also several drafts release; recovery in plaintiffs’ berg (2) Development certain which was Class both the Class S.I.G. rights. But court found royal- should be limited This find- agreement executed. was never attaching royalties and accrued ty rights oral, as docu- supported as well ing opin- scope in this indicated thereto of agree- mentary, Therefore evidence. more; ion, plaintiffs should (3) and no transferred that I.G. is not evidence ment Lauryl recovery in Amine Jersey group. rights Lauryl Amine to the also AD decree should for- thought show does that the claim modified recite necessary to transfer mal patents is Jersey-originated dismissed strengthens AD therefore merits, ju- for lack of than on rather inference, drawn (cid:127) appeal is not Plaintiffs’ sus- risdiction. agreements concern- nonproduction of tained. patents, that no trans- other seven ing the modified, and, af- modified Decree contemplated. them was fer of awarded de- court are firmed. Costs modified must be Consequently the decree fendant. except recovery these items. FRANK, Judge (concurring). Circuit Reopen Motion opinions Wyzan- Although Judge point Only remains Evidence. one Further excellence, they unusual leave ski are of urge cer- Plaintiffs for discussion. complicated for our consideration several received documents should have tain Judge opinion problems Clark’s in connection evidence considered Nevertheless, sev-' brilliantly deals. as to findings nature of sham items, eral I think well to make some Hague transactions. These documents further comments. discovered I.G.’s files United *19 disposes paragraph last 1. Since its agents Government after war. States matter, point major- in 4 of the else were delivered to defend- The documents in I opinion join, is do not ity dictum which in the District ant’s counsel Court the issue especially there discussed because inspected plain- thereafter counsel for argued orally will before us not After the close of tiffs. case Supreme be decided soon Court. Court, plaintiffs sought to have District evidence; in in 5 discusses conten-
them Point defendant’s received 2. anti-trust if concerning We think they were unsuccessful. laws as receipt rejection patents. or of these documents to was that contention confined opinion following, jurisdiction, it the court’s and that I add the lest our would within Perhaps rejecting it: it abuse it. offered be as did not documents taken doctrine, findings rule, patent quite aside any not have affected the from could court’s Hague Moreover, return Conference. be- that the seized without on the government Germany by any officer authority the condition lawful cause of I.G., be be if the portions judicially records will- will denied I.G.’s illegally.1 would upon to time in the future. Of its return used from time be found 1 hues, D.C., 696,. 699-701; Strong States, Cir., United F.2d 1 53 Cf. 458; Cir., 453, Fried, 261, 150; 2 F.2d A.L.R. Voor re 161 79 46 F.2d States, Gallagher States, Cir., Cir., v. United 6 F. v. United hies F. 277; O’Dowd, D.C., United States v. 2d 602; 273 F. United States v. Good- greater than, probable then, highly Perhaps, seemed in if it befar.,- here, any Party Agreement, the Four that on return in- statement property, employ it violate the seizure. make to To that telligible adequately my sole ob- explain to laws, judgment, that antitrust dictum, defendant, jection my I must colleagues’ ground, be should facts proof the following suit on that state in detail leave renew the record fully my colleagues and the not illegal ceased. threat of such use had stated think, have question, which, they that effect of I need here consider enjoins such decree because the overlooked. consent suggest use, that defendant does that, by Article II Notwithstanding contemplate violated vio- “assigns and Agreement, I.G. Party Four decree. lation of that patents, Ar agrees assign” the Class that judge 3. The district held provides: “S.I.G. IV-A explicitly ticle pat- to some of the Class A title obtained agree obligates period of this itself require equity in ents engage in business save ment not to the others. As- I read convey title to in transferring licenses granting that of effect, 9, they, my colleagues’ point patents rights within coming terests ruling. agree with Elsewhere that assigned hydrocarbon field however, opinion, to conclude seem I.G.”2 agreement by Standard that, anti-trust de- because consent provision (This provision with the ties in cree, merely is entitled corporate of S.I.G. charter those licenses to others under in manufac prohibits engaging it from the result at which Assuming to be provision operations; charter turing arrives, opinion I concur it.
majority by holders of be amended could 85% my go colleagues’ along But I cannot 20%, S.I.G.; stock held the. intimation, dictum, that, had by way of required the consent amendment decree, there trial consent it, V, provides I I.G.) Article read judge’s would have been correct. ruling “interests” transfer of I call because I think it is not a it dictum corpora transfers to be step necessary arriving at our decision. restricted dictum, empotvered to And regret join I and will tions which “shall not it, apparent approval operations, and manufacturing because engage judge’s (i. e., passed) obliged conduct the ruling trial title shall is, believe, contrary precedents, rights conveyed to them under patent I imposed upon consequence, as those and would have conditions the same had the ab- sent under Article IV-A giving the consent S.I.G. S.I.G. hereof.” cesses field.” cle V as a whole drogenation solely to Article *20 nearly by way censes payable rights $ [*] It This 3 Emphasis 2 Emphasis [*] * imposed upon [*] consideration defined Article s* with Article also » I think such an of for as lying suggested V incorrect. “example.” as IV-A as it and may be, process this patent added. added. within granted “specific makes provides that substantial which, rights Note stating A S. G.” interpretation It Article V deals reading uniform I. this class class S. G. cites for in fair, hydrocarbon “conditions I. Article apparent, reference royalties of merely patent basis. “only Arti- pro- hy- li- of I, ment were followed and sc I think. Article V in its Art. For patent outside corporation, ent the same as assignment terests of other Standard cess templated so follows: “Departures long rights proposed licensing plan example, Ill corporation rights as and S. I. G. by for the I. G. United made and the the result as far to S. I. for a Arts. for the United S. though refrain long are I. for a consideration, hydrogenation Ill States, G. Article III and IV. concerned, States. These cor hydrogenation asG. as and IV is effected. may may consideration, and proposed plan entirety said depart provided making- of Art. result as the to shall he process a third assign to an from pro con pat in IV * ** by (if patent were imposed pertinent Class “conditions S.I.G., think, it immune —as upon valid), IV-A” I S.I.G. would not be Article this to used or have been if had title legal effect: If itself made in- patent- an products, then any patented judgment or an adverse sold —from Any party “Assignment may Agreement. empowered porations to en shall not be any part assign operations, gage manufacturing and or whole rights accruing licensing obliged it under and benefits to bo to conduct the shall of the assign- conveyed agreement, patent rights this with or without them to obligations ment im of those are not same those which as conditions personal inseparable posed upon from busi- IV-a here S. I. Art. G. under Any obligated respective parties. ness of tlie to as- of. S. I. G. not be shall signment obligations party by one to I. for the considerations account received G. shall, however, gards pay grants as effective re- but shall be such assigning responsibility of so over entire considerations received party respect Company to the thereto.” Jer to New Standard Oil suggestion sey Another such on Arti- rests own for its IV-B, account after deductions XVII, provided cle which as follows: b & reads Art. c. Agreement. provide obligated “Duration of to shall I. G. be S. royalty agreement “A. This I. payments receives account of shall bo G. effective cash, 9th, including free shares or Nov. remain in shall by years consideration, by said force until terminated two received cor other party any porations by com written notice from the licensees the served pensation provided in IV-A hereof but Art. others no such notice shall be prior served to tire same extent as if those licensees December to patent rights, directly including S. I. G.” “B. All were licensed licenses (save paragraph suggested that IX also those D covered in Article any assign hereof), may assigned which authorizes S. I. to are be G. or by any outright granted party I. to Standard or G. to another “patent agreement solely IX to or in Article relates accordance this But rights with enjoyed purchased by shall to Standard continue be hereafter held others,” party acquiring from and not so until trans- them or I. G. expiration respective patents, IX to I. reads as S. G. Article even ferred agreement though this shall have earli- follows: terminated, Rights. assign- party er All but no be obli- Patent shall “Purchased gated any give any grants patent to other technical ments experience agreed assistance relation be are herein made patent rights expira- surviving by ject after the I. G. sub- or I. to S. are G. Standard agreement. provisions, of this following far tion in so patent nor S. I. G. here- Neither Standard shall relate to “C. obligated payments any purchased be I. I. G. make Standard or after paragraph patent rights except G. D covered others: If such from hereof, purchase the termination of this or I. after Standard offered agreement, save for on account of the oiler is made one theG. appears coming shall, within im- revenue if the matter accruing other, portant shall be before ter- coopera- so, mination, practicable but I. G. shall to hold seek continue do pur- enjoy participation any making such and pensation paid of the other com- accruing chase, before the fair distribution such (cid:127) agreed may up- expense agreement, termination be then even total payment though part such shall cover on. The operate co- refusal expense enduring obtained the licensee in and share beyond agreement. acquisition the term of this shall release the ac- every Excepted provisions patent right way quired “D. agreement, paragraphs operation Article, but the of this C brought patent rights relating patent under this of I. shall G. hydrocarbon hy- agreement, but extent field not to the the ac- the drogenation process acquired by same, party quiring still holds the I. G. *21 payment upon subsequent 31, the to December other of its 1941. time purchase excepted patent price.” rights may, equitable share of the These be- expiration suggested agreement, that of further Article fore the It is this assign I. to S. G. the I. G. to others for XII authorizes S. licensed term of the the full patents Agreement question, But that in itself. Article but S. bp obligated light (which read in the I. to must the shall account to of G. I. Agreement) provided the is IV of follows: G. as Art. hereof re- rest
939 merely fringcment acquired acquired far than the Surely suit. S.I.G. less right it en- right patent “bundle” since the to license others.4 It no full of outright, infringement judg- patents joyed immunity of since any to sell the no ments, dispose the purchaser validly confined of any would likewise be could licenses; majority except conditions. (as patents subject the drastic granting circumstances, opinion I think transferee shows) had no interest such pat- royalties beyond ex- title to a of its does not reimbursement become vested ent, “as- $11,000 penses although the deci- a formal it receives year. Yet separate in- signment” has judge sion same or of the district —that Mackenzie, patents confer See Waterman full title strument. v. —would 256, 252, 334, L.Ed. 11 34 138 S.Ct. immunity in- U.S. judgments of it an 923; Nye Tool Tool v. Die Co. fringement empower it sell Crown & Works, 43 S.Ct. Machine 261 U.S. despite restrictions, all free of Commissioner, 516; Rohmer v. 67 L.Ed. explicit the Four contrary provisions 61, 63; Corp. Cir., v. 2 153 Six Wheel F.2d Party Agreement. Cir., Co., F.2d Truck 50 Motor Sterling pro effect of these restrictive 568; Vickers Research Co. Doherty v. colleagues. my visions is not discussed Cir., Co., 809. Petroleum 80 F.2d most their dic I consider unfortunate And Nevertheless, agree I that tum, may it mislead district court well to should receive relief. Here it is disregards precedents case and as this it (1) differentiate kinds of situations: two own recent decision —including our enemy Suppose that, after alien con- Cir., Commissioner, F.2d Rohmer v. citizen some to an American tracted to sell 61, 63, the crucial There we held coal, (wheat for in- ordinary property or question type case whether in this stance), Custodian seized parted “substantially patent-owner has passed in the before title hands the alien ”; rights’ ‘bundle less than entire citizen, paid alien a who had that, clear substantially we made less when As, price. ordinarily, large purchase transferred, amount consideration matter the consideration size of what the irrelevant; there, too, explained paid is property, the monetary value of previous general qualified our state performance courts will not Corp. Aniline Film ments General contract, & citi- may it such Cir., Commissioner, 2 139 F.2d a case specific performance, could obtain zen statute, my colleagues. under this Custodian.5 cited accruing spect “licensing from suck I. revenues received G. revenue” thereof, agreement. for full term not- after licenses the termination may withstanding suggested, be- the same extend if B even is construed agreement. very right yond thereby life of is of conferred agreement scope; “E. as of the date of termi- narrow Effective could terminated, agreement earliest, S. I. G. shall not be until nation of patent 1947, by reassign I. com- which date the life G. December subject many Paragraph D, ing within such would have been theretofore over duration. licenses brief 4 Except perhaps (as granted As such licen- thereunder. indicated in note 3) reassignment ses, right outright shall not affect narrow to transfer par- obligation patents unexpired agreement the licensee when the ticipation royalties tire terminated. paid.” question As this to be was not discussed suggested paragraph involved, and is not here G., gives it I. after the termination S. need here be answered. pass outright right passing $35,- I note in that here the (subject existing licenses) 000,009 paid title cannot be said to have been (other solely than those within title to the Class A D) unexpired pat- the then life the. Class B patent. ents; I do not so Read- construe B. for Standard received 80% ing O, E, royalties immensely connection with D. and and other valuable light V, intangibles. Articles IV-A merely think I off the cuts *22 9áO would author- statute
(2) I think this against Cus- specific performance
ize alien with an
todian contract of such a unique chat-
enemy it land if related to
tels, contract would (a) such a because against a specifically enforcible the Custo- (b) with
transferee notice think, must, be dian, statute, under this I agree I
regarded As such transferee. colleagues right my that the have fcoen others would licenses to aor against I.G.
specifically enforcible notice, therefore I from it with
transferee de- entitled to
believe that are right thus en-
cree in this suit that against
forced the defendant.
That, however, very different award ruling that or should S.I.G. has n since, repeat, title to
ed im confer ruling valid, from munity, if even actions, infringement should
judgments make, products— patented use or sell Party think the Four immunity which I an precluded.6
Agreement carefully et al. TAYLOR
CLARK
No. Docket Appeals, Second Circuit. Court of
Circuit Sept. 22, 1947. 15, 1947. Revised Oct.
As
FRANK, Judge, Circuit dissenting. part might conceivably argued of a substantial use the “bundle deny rights,” defendant, title but is difficult I. owns the S. G. parted G., transferor has “substan- I. has the successor G., tially * injunction less than I. entire ‘bundle’ S. * attempt Commissioner, Rohmer v. violate the conditions latter supra. best, G., imposed At I. How S. to a most Articles IV-A and V. that, important part acquired “bundle,” ever, the authori I think" title, cited, far the facts a bare less above which would than ties justify judge injunction prevent pass trial that which the such an allotted to it. enjoin age title: When a court will