Read Ebook: Arguments before the Committee on Patents of the House of Representatives conjointly with the Senate Committee on Patents on H.R. 19853 to amend and consolidate the acts respecting copyright June 6 7 8 and 9 1906. by United States Congress House Committee On Patents United States Congress Senate Committee On Patents

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Ebook has 865 lines and 64539 words, and 18 pages

Whereas the AEolian Company is engaged in the business of manufacturing and selling automatic musical instruments controlled by perforated music sheets, and in manufacturing and selling machines for playing keyboard musical instruments, which machines are controlled by perforated music sheets, and in manufacturing and selling perforated music sheets for such automatic musical instruments and machines; and

Whereas the AEolian Company is desirous of acquiring the exclusive right for such perforated music sheets in and to all the copyrighted musical compositions of which the publisher is the proprietor, or as to which he is the owner of any rights, and of all those other musical compositions which may hereafter be protected by copyright, and the copyrights for which or rights in which may be acquired by him;

Now, therefore, the publisher, for and in consideration of the premises, and of the sum of , lawful money of the United States, to him paid by the AEolian Company, receipt of which is hereby acknowledged, and for and in consideration of the true and faithful performance by the AEolian Company of its covenants hereinafter made, does hereby sell, assign, transfer, and set over unto the AEolian Company the exclusive right for all perforated music sheets of the kinds aforesaid in and to all the copyrighted musical compositions of which the publisher is the proprietor, or in the case in which he is the owner of any less rights, to the extent of said rights, and does hereby covenant and agree with the AEolian Company to give and secure to it the exclusive right in like manner for all perforated music sheets of the kinds aforesaid in and to all those other musical compositions which may hereafter be protected by copyright, and the copyrights or rights in which may be acquired by the publisher, except that if the AEolian Company do not accept any price offered them within three months after said offer, then the publisher may be at liberty to dispose of the same otherwise.

And the publisher, for the consideration aforesaid, hereby covenants and agrees, so far as it may be reasonably in his power, to protect the AEolian Company against any claim of any third person in respect to any and all copyrighted musical compositions which may be involved in this agreement, and the copyright of which may be owned by the publisher.

And the AEolian Company, for and in consideration of the premises, hereby agrees that it will keep correct and true books of account in which it will set down or cause to be set down entries of all perforated music sheets made by it for playing the copyrighted musical compositions owned or controlled by the publisher; that it will on the 20th day of each and every January and July, during the continuance of the manufacture and sale by it of the perforated music sheets for playing such musical compositions, render unto the publisher a correct and true statement of the number, names, and other designations of such perforated music sheets sold by it during the six preceding calendar months, and that at the time of rendering each and every such statement it will well and truly pay unto the publisher a license fee or royalty of 10 per cent of the list prices made by the United States publishers of the printed scores or copies of such musical compositions, but never more than 50 cents for any one of such perforated music sheets.

And the parties hereto mutually covenant and agree that nothing herein contained is to obligate the AEolian Company to pay any license fee or royalty upon such perforated music sheets as shall be made by it in the United States and sold or shipped to any other country, unless it shall have been decided by a court of competent jurisdiction of such other country that the copyright laws of that country shall be applicable to perforated music sheets of the kinds herein mentioned.

And the parties hereto mutually agree and covenant that the term "perforated music sheets" is not to be construed as covering the controllers of those musical instruments which are generally known as phonographs, or music boxes, or hand organs.

Anything herein to the contrary notwithstanding, at the expiration of thirty-five years from the payment of the first license fee hereinbefore provided, the AEolian Company shall not be entitled to licenses under the copyrights thereafter acquired by the publisher, but all licenses existing under copyrights theretofore acquired by him shall remain in force until the expiration of the terms of the copyrights under the terms hereinbefore provided.

During the existence of this contract, after the payment of the license fee hereunder, the AEolian Company obligates itself to prosecute diligently, at its own expense and by its own counsel, in the name of the proprietors of the copyright, all infringers of the rights granted to it, the AEolian Company.

And the parties hereto mutually covenant and agree that all the provisions of this agreement shall be binding upon and inure to the successors, executors, administrators, and personal representatives of both the parties hereto.

In witness whereof the publisher has on the day and year first hereinabove written hereunto set his hand and seal, and the AEolian Company has caused its name and corporate seal to be hereunto affixed by its proper officer thereunto duly authorized.

Signature of publisher witnessed by--

J. F. BOWERS, PAULINE FLAHERTY.

Memorandum of agreement made and entered into this 30th day of April, 1902, by and between Chicago Music Company, of Chicago, in the State of Illinois, party of the first part, hereinafter called the publisher, and the AEolian Company, a corporation organized under the laws of the State of Connecticut, and having a place of business in the city of New York, in the State of New York, party of the second part, hereinafter called the AEolian Company, witnesseth:

That whereas the parties hereto have, of even date herewith, entered into an agreement whereby the AEolian Company is to have the exclusive right for all perforated music sheets intended for use in controlling automatic musical instruments or machines for playing musical instruments, in and to the copyrighted musical compositions of which the publisher is the proprietor or as to which he is the owner of any rights, and in and to all those other musical compositions which may hereafter be protected by copyright and the copyrights or rights in which may be acquired by him; and

Whereas the parties hereto are desirous of entering into a further agreement with reference to the matters and things expressed in the above-mentioned agreement of even date herewith;

Now, therefore, the publisher, for and in consideration of the premises and the sum of , lawful money of the United States, to him by the AEolian Company in hand paid, receipt whereof is hereby acknowledged, does hereby covenant and agree that no charge shall be exacted from or be due from the AEolian Company for the manufacture or sale by it, or any of its customers, of any perforated music sheets of either of the kinds aforesaid, for playing any of the copyrighted musical compositions which are owned or controlled, or which shall hereafter be owned or controlled in whole or in part by the publisher, until a decision of the court of last resort in a suit which is to be instituted against some manufacturer or user, other than the AEolian Company, of such perforated music sheets for the purpose of testing the applicability of the United States copyright laws to such perforated music sheets, and not then unless such decision shall uphold the applicability of the United States copyright laws to perforated music sheets of the kinds aforesaid.

And for and in consideration of the premises the AEolian Company hereby covenants and agrees to pay all proper expenses of conducting said suit for the purpose of testing the applicability of the United States copyright laws to perforated music sheets of the kinds aforesaid, and that if the court of last resort shall in such suit decide that the United States copyright laws are applicable to such perforated music sheets, then and in such case and from that time forward the AEolian Company will keep books of account, render statements, and pay royalties, as provided by the aforesaid agreement of even date herewith, but shall be free from obligation to make payments for the past.

And it is mutually understood and agreed by the parties hereto that neither party hereto is to be obligated in any way by any of the provisions of this agreement, or of the aforesaid agreement of even date herewith, until the AEolian Company shall notify the publisher that a number of copyright owners, satisfactory to the AEolian Company, have made similar agreements with said company.

Witnessed by--

PAULINE FLAHERTY. J. F. BOWERS.

DEAR SIRS: Pursuant to the provision of the agreement granting us the exclusive right under your United States copyrights for all perforated music sheets intended for use in controlling automatic musical instruments and machines for playing musical instruments, we hereby notify you that a number of copyright owners satisfactory to us have made with us agreements similar to our agreement with you. From this date, therefore, our agreement goes into effect.

Looking forward to profitable and pleasant business relations, we remain,

Yours, truly,

Mr. CHANEY. I would like to have this gentleman who has just spoken to us submit a typewritten statement relating to the various sections in the bill to which he objects, and setting out his objections.

The ACTING CHAIRMAN. Without objection that privilege will be accorded to him.

GENTLEMEN: I file herewith in typewriting specific suggestions for the amendment of the said bill, in pursuance of the resolution of the joint committee, passed on the 8th day of June, 1906; these remarks or this statement to follow in the record the exhibit contracts which I presented to your committees at that time.

Very respectfully,

H. N. LOW.

SUGGESTIONS AS TO THE AMENDMENT OF THE PENDING COPYRIGHT BILL.

GENTLEMEN: If the allegations which have been made before the committee, and not denied, and which can not be successfully denied, that there has been effected a combination in the nature of a trust to secure practically all of the commercial business of this country in the manufacture, sale, and use of mechanical records or controllers for the production of music, etc., by mechanical means are true, then a very serious situation confronts you.

The agencies relied upon to make said combination of publishers and manufacturers successful are--

In one of the contracts referred to, dated April 30, 1902, between the Chicago Music Company and the AEolian Company, it is provided--

"During the existence of this contract, after the payment of the license fee thereunder, the AEolian Company obligates itself to prosecute diligently, at its own expense and by its own counsel, in the name of the proprietors of the copyright, all infringers of the rights granted to it, the AEolian Company."

In the other contract of the same date and between the same parties, a facsimile of which has been filed with your committees, it is provided--

Although defeated so far, it is not reasonable to suppose that the combination of the AEolian Company and its "number of copyright owners satisfactory" to that company would rest without further effort to make effective for profit the agreement into which they had entered. The only remaining means was by new legislation, and I submit that the aim and end of the pending bill is to be a substitute for that favorable decision of a court of last resort which the AEolian Company failed after strenuous efforts to obtain.

Certain provisions of the bill here and there--for example, the lengthening of the copyright term--have attracted to the support of the bill various interests who are totally indifferent one way or the other to the question of perforated music sheets or phonographic records, but I submit that these other provisions are more or less unimportant, do not improve the present law, and most of them would never have been heard of except for the desire of the special interests above referred to to obtain new legislation as to the mechanical producers of sound.

In the spring of 1904 attempt was made by this same combination to obtain the legislation desired by the insertion of a specific provision in the law to substantially this effect:

I have not been able to discover that this proposed amendment of the law was ever introduced in the form of a bill into either House of Congress. It may have been. But I am informed that it was formulated for the purpose of introduction as a bill in Congress in the terms above set forth.

It was found impracticable to obtain the new legislation in such specific and undisguised form, and resort is now had to a pretended revision or codification of the entire copyright law, for which there is not the slightest necessity and which will inevitably give rise to a great amount of litigation before the meaning and effect of the words used in the new law can be legally understood, for the sole purpose that the AEolian Company may have with its contracting publishers and copyright owners "pleasant and profitable business relations," as expressed in the notice from the AEolian Company to the contracting publishers, dated May 5, 1902 . This notice states "a number a copyright owners satisfactory to us have made with us agreements similar to our agreement with you."

Although the matters above referred to have been opened up before your committee in the remarks of Mr. O'Connell, I have felt it my duty to give my view of the matter in brief form, both in confirmation of what Mr. O'Connell has said, and for the purpose of indicating that the bill itself and proposed amendments thereto must be scrutinized by your committees with the greatest care before it is reported.

As to amendments of the bill, I see no alternative to the striking out of paragraph of section 1. If the combine exists as is alleged it is obvious that the patents, inventions, machinery, and plants of all those manufacturers of mechanical records who are not inside of the combine, that is to say, of all the manufacturers of perforated music rolls excepting the AEolian Company, and all the manufacturers of talking machines and records excepting the two companies who are alleged to be members of another combination or trust for the exclusive manufacture of such machines, and of all without exception of the manufacturers and users and sellers of pianos and organs which are operated by perforated music sheets, will be rendered practically useless, the owners of such manufactories will be put out of business, and their workmen will have their field of labor and bread taken away.

If this will be the result of the bill, and especially of the paragraph section 1 , the bill is most unjust and class legislation of the worst type. And that is just what the bill is intended to be, but I am thankful that its object can not be concealed.

It is no answer to the above objection to say that the bill provides only for the future. So do the contracts between the AEolian Company and its "satisfactory number" of copyright owners. The said contracts are unlimited as to time, having been signed by the great bulk of the trade , they leave outside of the combination only small publishers, and the contracts provide as follows:

"Now, therefore, the publisher, for and in consideration of the premises, and of the sum of one dollar, lawful money of the United States, to him paid by the AEolian Company, receipt of which is hereby acknowledged, and for and in consideration of the true and faithful performance by the AEolian Company of its covenants hereinafter made, does hereby sell, assign, transfer, and set over unto the AEolian Company the exclusive right for all perforated music sheets of the kinds aforesaid in and to all the copyrighted compositions of which the publisher is the proprietor, or in the case in which he is the owner of any less rights, to the extent of said rights, and does hereby covenant and agree with the AEolian Company to give and secure to it the exclusive right in like manner for all perforated music sheets of the kinds aforesaid in and to all those other musical compositions which may hereafter be protected by copyright, and the copyrights or rights in which may be acquired by the publisher, except that if the AEolian Company do not accept any piece offered them within three months after said offer then the publisher may be at liberty to dispose of the same otherwise."

From the foregoing we arrive at this conclusion, and there is no escape from it, that there is in existence a combination whose design and effect upon very important business and laboring interests of this country will be injurious and unlawful if the bill should be passed as proposed, which combination is of unlimited duration as to time, and which combination will control, for the purpose of producing perforated music sheets, all the copyrights or rights of production hereafter for such unlimited duration of time which may be acquired by the great bulk of the trade of this country. Your committees will see, therefore, that the bill provides for the profitable future of the members of the combination without limit as to time.

The result of this will be threefold:

The assertion made in support of the bill, that it relates only to the future, is completely met with the reply that the bill does not provide for the future of anyone who is outside of the combination.

If the existing copyright law is bad or insufficient and anything like a revision of or a codification of the copyright statutes in a new law must be made in the interests of justice, let it be done. But let care be taken that you do not do injustice. If a new copyright law is to be enacted, and the pending bill is to be the foundation of such a law, the practical question is, how is it to be amended in order that it may not cause the evils above referred to.

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