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THE BATH TUB CASE BY the decision in the Bath Tub case (Standard Sanitary Mfg. Co. v. U. S., decided Nov. 18) the Supreme Court has now formulated the doctrine that the patent law does not afford legal protection to an agreement into which manufacturers and dealers enter with the manifest purpose of suppressing com petition and controlling prices. In con sidering such an agreement in future, the Court will look at the actual facts lead ing up to it and to the intention of the parties, and where it finds simply an attempt to restrain trade in violation of the purpose of the Sherman act, under cover of the supposed rights of patentees, it will deal with the combination as merely an unlawful monopoly subject to the remedies provided by the anti-trust law. In this way the chief objections to the present state of the patent laws, as shown by the fears expressed by Chief Justice White in his dissenting opinion in the Mimeograph case, have been met, and the principal argument for the passage of the Oldfield bill pending in Congress has fallen to the ground. No other recent decision goes further in restricting the rights of patentees. It marks the latest stage of judicial limitation of freedom of contract in the sale of goods. In some respects, the sale of all goods, whether patented or not, may be regarded as subject to the same general considerations. In Dr. Miles Medical Co. v. Park, 220 U. S. 373, the Court limited the right of the manu
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facturer of unpatented goods to control the price paid by the consumer. In Bobbs-Merrill Co. v. Straus, 210 U. S. 339, it established that no restriction could be placed upon the vendee's right to sell a copyrighted book. In Henry v. Dick Co., 224 U. S. 1, the Court seemed to take a liberal view of the right of a patentee to impose restrictions upon the purchaser's use of the patented article, but this latest decision in the Bath Tub case dissipates the notion that the patentee is the recipient of any extraor dinary privilege in the enjoyment of his monopoly of sale. All the limitations in the foregoing cases are subtractions from the com mon law right of the owner or vendee of goods to sell them on what terms he chooses. Such a right is not properly a patent right, for letters-patent do not confer any privilege with regard to the sale of goods which the owner of unpatented goods did not have at common law. A merchant has always had the right to sell his goods on whatever terms he deems advisable, consonant with public policy. He may insert into a contract of sale any covenants he may desire, and the contract is valid if not void for lack of consideration. A paper manufac turer, for example, may stipulate with purchasers that his paper is to be used only as a writing paper, and such an agreement is supported by sound con sideration if it serves to assist him to establish the reputation of a certain writing paper bearing a particular trade name. Such at least was once the law.
