Rensselaer Republican, Volume 16, Number 26, Rensselaer, Jasper County, 6 March 1884 — A MONOPOLY BEATEN. [ARTICLE]

A MONOPOLY BEATEN.

The Protected Barb-Wire Litigation in lowa. Another Decision Against the Washburn & Moen Company. [Keokuk Dispatch.] Judge McCrary rendered final decrees in the two suits brought by the Washburn Sc Moen Company against Walter and J. K. Rhodes for the infringement respectively of the reissued Glidden and K elley barbed wire patents. The deorees in these two caeles apply to eight lowa suits in all, in which the same Issues are involiflfcd. The decree on the Glidden reissued patent declares ft is Invalid and of no effect, ’because It is tlie same invention described in the Original patent, and secured because the olalm of the reissued patents was unlawfully expanded, and there was undue delay in applying for said reissue. Complainants’ bill was therefore dismissed and defendants have the right to recover their eosts. In the suit involving the Kelley patent it was held that the fourth olalm of the re* Issued patent was invalid for the same rear sons stated In the first case, and the court found for the defendants upon the issue of Infringement made in the pleadings. Thosaihe order was made concerning costs and dismissal of the bill. The Washburn & iloen representatives say the next fight will be on the original Glidden patent. Same of the lowa coses are likely to be carried to the United States Supreme Court. HISTORY OF THE IJTIOATION. Plain or unbarbed wire had been in quite general use for fencing throughout the West for some years before barbed wire began to be made in a small way under patents taken out as early as 1868 by Kelley and 1874 by Glidden.and others not so well known. Between 1860 and 1876 there were fully thirty different patents granted to various parties on barbed-wire fences. But the business was in its infancy. Few realized what it was to become in half-a-dozen years. One of these few was Mr. Washburn, of Worcester. Mass. He conceived the idea of buying up all the important patents and making a great monopoly. In February, 1876, Washburn & Moen obtained their subsequently famous “reissues" of tile Kelley and Glidden patents. Tho reissuing was ingenious. In this-new form the patents eontained and claimed much more than the originals. Under these reissues the Worcester firm setupits so-called “broad claim" It held that barbed-wire fence, no matter by wlifttilovdce the wire had been prepared. Having seemed the patents, having had them reissued with these new and sweeping claims, the next step was to secure a decision from the courts sustaining them. This was not gained sos several years. Meanwhile the business had grown enormously. Thrivihg wire factories had grown up everywhere in the Western States, competing with the large Eastern establishments. The business was entirely tree. Makers knew little about the patents, cared less, and were not interfered with. But Washburn & Moen were quietly at work. In November. 1880, they gained their famous case in the United States Circuit Court at Chicago. Judges Drummond and Blodgett deciding that the re-issued pafents were valid and in full force. The barb-wire business was brought to a short halt by this decision. Every man in the oountry making, selling, or using barb-wire was liable to suit for infringement, and manufacturers were liable to pay ruinous back royalties. In this state of affairs Mr. Washburn and his attorneys summoned the principal manufacturers of the country to meet them for a grand settlement. They came together in Chicago in February, 1881, three months after the decision. Washburn was in a position to dictate terms, and each maker took the best be could get. About forty firms were licensed to continue the business, each being limited as to the annual tonnage of its output and each being assessed a certain sum, larger or smaller, for back damages. Mr. \\ ashbum and liis licensees at this same meeting fixed upon a certain price for wire, no licensee being allowed to undersell. The price ot wire to consumers was advanced by the monopoly about S4O above the recent cur...rent price (raising, the wholesale price from about 6 cents to about 8 cents per pound). Washburn A' Moen's royalty was sl6 per ton. Small makers were not licensed, and were all crushed out. Such, then, was the little monopoly which from February, 1881, to the present time has added somewhat more then $10,1100,000 extra profit to the jiriee of wire sold 1 armors in half-a-dozen Western and North western. S ates. lowa, being much the largest consumer, felt the burden heaviest. The farmeis of that Stato formed a “protective association.’' They set up an establishment in lies Moines for making “moonshine" wire, and prepared themselves to fight the matter through the courts. Meanwhile tlie Supreme Court of the United States had Indirectly .-truck a blow at the monopoly by its decision on the subject of reissued patents in the celebrated case ot "Miller vs. The Bra.-s4Company.” In this case a new nnd valuable doctrine was laid down. There had arisen among a certain class of Eastern capitalists a very corrupt and pernicious practice in this matter of patents. If this article or commodity began to come into the markets, they had a practice of rummaging among old and al»andoned patents until they found something ia some wise relating to the now popular commodity. Of course this old patent cmdd be bought up for a song. They would then have it "reissued” aud so broadened and strengthened as to make it valuable and to give them a monopolizing power over the commodity. It was to check this dangerous practice that the Supreme Court laid down in the case of "Miller vs. The Brass Company” a set of new and stringent rules governing Lie reissue of patents. The new doctrine threw a cloud over the Glidden and Kelley barbed-wire patents and the Chicago Drummond-Blodgett decision. It gave the lowa farmers their basis tor a case. Under the countenance of the Farmers* Association several other “m-jonshining” factories arose and grew like mushrooms into large business by their ability to undersell the monopolists. Washburn «fc Moen entered suits and petitions against all these moonshln rs. Instead of carrying the suits against the farmers through the courts the monop,>lists, it was cha*gotl, bought up the lies Moines nnnufacturer, who was the agent tor tl»e Farmers’ Association. The brunt of th 3 fight on the ‘‘broad claim” was borne by the Grinnell Wire Company. A decision was made by United States Court for the Southern District of lowa in Hay, 1883, that tho Kellev anu Glidden reissued patents w. re invalid. This decision has now been affirmed in the Rhodes cases.]