U.S. Supreme Court
United States v. Univis Lens Co., 316 U.S. 241 (1942)
United States v. Univis Lens Co.
Argued April 9, 10, 1942
Decided May 11, 1942
316 U.S. 241
1. The facts establish venue for this suit in the District Court in which it was brought. P. 316 U. S. 246.
2. Sale by a patent owner of an article which is capable of use only in practicing the patent is a relinquishment of the patent monopoly with respect to that article. P. 316 U. S. 249.
3. A patent does not confer the right to control the resale prices of the patented articles after their sale by the patentee. P. 316 U. S. 250.
4. The owner of a patent covering lens blanks (capable of use only in manufacturing eye glass lenses) and also (as was assumed in this case) covering the process of grinding and polishing them, by which the blanks are converted into finished lenses for use as eyeglasses, devised a licensing and price-fixing system pursuant to which, for a stipulated royalty, one licensee was authorized to make the blanks and sell them to other licensees, who in turn were authorized to buy them from the maker at prices fixed and to finish them as lenses according to the patent and to sell the lenses to other licensees, who were authorized to sell them to the public -- the prices in all cases being those fixed by the patent owner. The rewards of the patent owner and the manufacturer of the blanks for the exploitation of the patent and the patented lenses were derived wholly from the proceeds of sales of the blanks by the manufacturer, from which proceeds the royalty was paid.
(1) That, with the sale of the lens blanks for use in manufacturing lenses, the patent owner conferred on the buyer the right to practice the patent with respect to the blanks, and parted with the right to assert its patent monopoly with respect to them, and could no longer control the price at which they might be sold in their unfinished, or their finished, forms. P. 316 U. S. 250.
(2) The stipulations for maintenance of prices derived no support from the patent, and must stand on the same footing under the Sherman Act as like stipulations with respect to unpatented commodities. P. 316 U. S. 251.
5. Agreements for maintaining prices of goods in interstate commerce, including restrictions imposed by the seller upon resale prices, held unreasonable restraints within the meaning of the Sherman Act. P. 316 U. S. 252.
6. The Miller-Tydings Act cannot be so applied to products manufactured in successive stages by different processors that the first processor may control the prices of his successors. P. 316 U. S. 253.
7. Features of a licensing system, which, by themselves, might be lawful, but which are closely identified and interwoven with a scheme of price restriction violative of the Sherman Act, will be suppressed with the scheme as a whole. P. 316 U. S. 254.
No. 855 reversed.
No. 856 affirmed.
Appeal and cross-appeal from a decree of the District Court which granted in part, and in part refused, relief sought by the Government in a suit under the Sherman Act.