But

registration scheme was adopted, side by side with and as supplementary to a system of local patents. In other colonies it became what to this day it is in the colonies of St. Helena and the Falkland Islands, the only form in which a local patent grant could be obtained. whether in substitution for or in supplement of a local grant, the system of local registration seems to have been a scheme most admirably adapted to the circumstances of a complex organism like the British Empire. The inventor who secured a British patent became immediately free of a great family of States. He could perfect his invention, complete his experimental work, accumulate capital, and when in this way his manufacture was a going concern, he could start a branch establishment in such colonies as required his industry under the protection of what was substantially a local patent for the residue of his original term. Such a system was the worthy product of a great age, and may reasonably have inspired the hope that in time to come the slow working of this common Patent-law would create a widely ramifying industrial system which would powerfully promote commerce between the various members of the whole, and create bonds strong though impalpable which would hold the daughter States to the Mother Country, ever growing in strength, but never liable to bear with hard or hurtful pressure upon any part.

But to the realisation of that fascinating hope something more was necessary than a scheme of Colonial laws. If the British grant was thus to become the source from which so large a stream should flow, it was important that the machinery for granting patents in Great Britain should be put in thorough working order, and this was accordingly taken in hand and carried out by the passing of the Patent-law Reform Act of 1852. The cumbrous machinery devised by King James for preventing the abuse of the Royal prerogative was replaced by simplified forms of application and more summary methods of dealing with the application when made; and a small Board of Commissioners, with an office and official staff, was substituted for the Home-office, Privy Seal, Lord Chancellor, and other departments through which, under King James's scheme, the luckless inventor had to run the gauntlet of official criticism. Minor improvements accompanied this great reform. A large reduction of fees made patents more available than before, and the introduction of the provisional specification closed the

Prior to

main door previously open to fraud. 1852, as now, the patent was granted for an invention specified only by a title in the grant itself. The nature of the invention denoted by this title was subsequently ascertained by a specification enrolled in Chancery under a proviso to that effect contained in the patent. Of course such specifications constantly varied — and sometimes fraudulently — from what the inventor had in his mind when his application was made and his patent granted. For when he came to prepare his specification he was preternaturally wise with that wisdom which comes after the event. To meet this difficulty the draughtsmen of the 1852 Act devised the provisional specification, which was to be an amplified title, describing, with all the fulness necessary for complete identification, the invention for which the grant was made. By these and a number of subordinate improvements the British Patent-law was brought into a shape in which, though modernised in all its aspects, it provided adequate expression for the ancient common law as it had been formulated by Popham, C.J., and the Judges of the Queen's Bench, proclaimed by King James and finally ascertained by Sir Edward Coke and the drafting committee over which he presided in the Parliament of 1623.

The Patent Act of 1852 furnishes the highwater mark of English legislation on the subject of patents. It was by no means final. The scheme of Imperial legislation, of which it formed a part, required for its fulfilment the Colonial Patent Registration Acts, which actually followed in due succession. It required also that at some later date the registration system should be extended so that when the Colonies came to have fully equipped and organised patent offices of their own the practice of registration might become reciprocal between all the different members of the Empire, and a patent taken in any one part of the dominions of the Crown might confer certain inchoate rights in all parts of the King's dominions, rights which might be matured and taken up at the patentee's convenience as his business resources grew. The opportunity for a grand development along these lines occurred in 1883 when the next measure of Patent-law reform was taken in hand. But the opportunity was missed. An Act was passed which indued many old things with new names and introduced one conspicuously abortive change into the law. But by 1883 the spring of ideas had run dry, the useful alterations then made were insignificant, and

a form of statute was minted which, being adopted by most of our self-governing Colonies and larger dependencies, put an end-for the time, at least-to all developments in the direction of drawing the Colonies closer to the Mother Country, and corroborating the loose ties by which Greater Britain is held together. No attempt was made to facilitate the registration of British patents in the Colonies, or to give the holder of a Colonial patent any privilege on an application for a British grant. The scheme which had been carefully elaborated by the statesmen assembled from every part of the Empire-at a time when the British nation at home and oversea was profoundly conscious of its essential unity and imposing strength-was ignored thirty years later, possibly even forgotten altogether, for the Act of 1883 appears to have been the work not of statesmen but of draughtsmen. Unfortunately the example so

set

was widely and consistently followed. Colonial Patent Acts on the model of our own Act of 1883 followed in quick succession and have abolished the registration system everywhere except in Barbados, the Straits Settlements, and two or three other Colonies.

The place of the destroyed system is now being taken, but very inadequately filled, by the International Convention. This Convention, as you know, was originally drawn up for the purpose of facilitating what may be roughly described as an interchange of patent rights between a singularly heterogeneous assortment of States having no political union whatever. The signatories represented the kingdoms of Belgium, Spain, Italy, the Netherlands and Servia, the French Republic, the Republics of Guatemala, Salvador, and the Swiss Confederation, and the Empire of Brazil. By later accession our own country and some others have come into the treaty, and among our colonies, New Zealand, Queensland, Tasmania, Western Australia, and Ceylon, have adhered to the arrangement. This treaty, no doubt, effects as much as can be effected in the direction of facilitating patent grants to foreigners, and assimilating systems of jurisprudence so divergent in their nature as the Roman Dutch law and the Code Napoleon. By the irony of fate it is replacing in our Own domestic system the family arrangement set up, but left necessarily imperfect in 1852, and as it comes into effect is reducing our Colonies one by one to the same footing in this respect as foreign countries. Since time does not permit me to discuss this

matter at large, I will not enter upon it further, but in turning away from it I trust that I may be allowed to say, with the emphasis of a personal conviction, that it is wise not to take for granted and without critical inquiry, that the newer is the better plan.

In the cursory sketch, which is all that I can this evening attempt of the course which reform of our Patent-law has hitherto taken, there is not much that I need add, but even a cursory sketch would be incomplete without some reference to the Act of 1902, which has crowned and completed the work of 1883. The Act of 1883 introduced, as you know, a system of compulsory licenses, that is to say, of licenses which patentees might in certain cases be compelled to grant, in order to secure the establishment within the realm of industries protected by patent grants. The mischief which was aimed at by the measure is a curious one. That a patentee should obtain a patent grant for the purpose of enabling him to set up a manufacture here and then hang back from manufacturing, and even prohibit the establishment of the industry which he has undertaken to promote, seems on the face of it a ridiculous situation; a situation so ridiculous that it might not unreasonably be thought to be impossible. But impossible situations are constantly arising in practice and, in truth, the explanation of this anomaly is quite simple. There are, in fact, two perfectly distinct reasons for which applicants seek patent grants. One applicant desires to practice his invention and create by means of it a profitable trade, the profit of which shall in the main accrue to him. Another desires, not to practice trade, but to control it. He is quite content that other people should do the trade provided that he is privileged to lay a tax upon it. If both succeed, the one secures profit-the other toll. Now the one whose property is in the toll is not of necessity concerned with the manufacture at all. It suits him equally well to obtain his toll from something else which he has not invented. And this can very often be contrived with but a fraction of the ingenuity in which inventors, as a class, are rich. It is especially easy in the case of patents granted for chemical processes where mere words count necessarily for much, and mere opinions even for more. The palmary illustration is the case, often told, of the Blackley Red Dye. A patentee, whom I will call B, invents and patents a brown dye stuff which turns out to be of no commercial value. People cannot be

induced to ouy it. Consequently there is no profit in it, and in the hands of a patentee of the manufacturer class it is a worthless grant. But time passes. Another inventor, whom I will call L, invents another dye, a red dye, for which there is a great demand. There is a considerable resemblance from the chemists' point of view-although very little from that of the practical man-the dyer-between the two substances. Both are hydrocarbons, both are derived from coal tar, both contain sulphur. The chemists are strongly of opinion that in passing from coal tar to red dye L must have passed through what I may for simplicity call a brown stage. Nobody of course pretends that a brown dye emerged at any stage. But in the existing state of our knowledge it is quite conceivable that incidentally and momentarily in the manufacturing operation the red dye stuff passed through a brown phase. That is enough for the patentee who lies in wait to take toll. Neither he nor anybody else can find any profit in his own invention, but it is quite conceivable that L in the course of making something else incurs a loss by reason of it, for eminent chemists can be brought to opine that in making the valuable red he must needs incur the expense of incidentally, momentarily, and wastefully producing the patented brown.

Here then, if a court can be persuaded to act upon the conjectures of eminent scientific men, is a manufacturer who is at last practising the manufacture of the brown dye and yet contriving to make a profit on his business, taken as a whole. Clearly he is a man who can pay toll. Why should he not pay?

You will think perhaps that there would be an obvious answer to that question inasmuch as the invention from which he derived the profit was his own: that if the patentee is entitled to a share of anything at all it must be a share of the incidental loss, which the theoretical use of the patented invention entails. But that would be very old-fashioned Patent-law, and it is not at all difficult to explain how an inconvenient alternative like that is at the present day evaded altogether. It has, you will remember, been assumed that our patentee for this occasion is not concerned with profit. Therefore he does not ask for profit and so avoids all discussion as to the amount of the profit to be divided, or the source from which it comes. He asks the court to give him--not profit-but control. In the language of the law he asks for an injunction to restrain the manufacture of which

he complains, and if the court will give him that, he willingly undertakes to manage the rest for himself. The audacity of such a demand is bewildering to anyone who stops to consider what it means.

An injunction is a legal contrivance for changing an unlawful act into a crime. The difference is well recognised in our law, and indeed in all civilised systems of law. For instance, it is an unlawful act to leave a just debt unpaid, but we do not now arrest the debtor, and clap him into gaol. He is constrained by gentler means to satisfy his creditor. Since the year 1869, our Legislature has carefully and consistently refrained from rating the defaulting debtor as a criminal at all, recognising, with a wise discernment, that the penalties of crime are not appropriate to all forms of shortcoming.

The rule of the Legislature was at one time the rule also of our courts. It was said that the remedy of injunction was an extraordinary remedy to which recourse should be had only when less stringent methods of coercion were shown to be inadequate to the requirements of the case. So lately as 1878, Lord Cairns laid down the rule that, in certain cases-the particular case with which he was dealing being a breach of covenant-a court of equity will see that by interposing, instead of leaving the parties to their remedy in damages, it would be doing more harm than it could possibly do good, and that in such a case it will take account of various incidental matters.

"It will consider, for example," said he, "whether the injury which it is asked to restrain is an injury which if done cannot be remedied. It will consider whether, if done, it can or cannot be sufficiently atoned for by the payment of a sum of money in damages. It will also ask this question-suppose the act to be done would the right to damages for it be decided exhaustively, once and for all, by one action or would there necessarily be a repetition of actions for the purpose of recovering damages from time to time. Those are matters which a Court of Equity would well look to and, on the other hand, a Court of Equity would look to this. If we interfere and say, in aid of this affirmative convenant that something shall not be done which would be a departure from it no doubt we shall succour and help the plaintiff who comes for our assistance. But shall we do that? Will the effect of our doing that be to cause possible damage to the defendant very much greater than any possible advantage we can give to the plantiff. Now, in a case of that kind where there is an amount of discretion which the court must exercise those are all considerations which the court will carefully entertain before it decides how it will exercise its discretion."

The case that we are considering is preeminently a case for the exercise of discretion. The patentee usually desires more than he is entitled to obtain in the way of relief even if his complaint of infringement be well founded. For argument can hardly be necessary to prove that profit and not control is what sound policy assigns to an inventor and what in fact a British patent is intended to convey to the patentee. There is a great risk that by the injunction, the court may give to him not profit but control. There is still another reason for caution. It is a principle of our law, as the passage just cited shows, that when the real matter of controversy is a breach of contract the courts will be somewhat slow to interfere by injunction and turn the mere breach into a crime. It would be easy, were this the proper place, to show that the wisdom of that rule is no less conspicuous than its mildness. Now the principle of the rule applies to the case of a discussion about the infringement of a patent right. At worst it is a breach of privilege; it can hardly be contended that the privilege is more sacred than a contract. In fact, the privilege itself has been described upon high judicial authority as a species of contract between the public and the patentee. For such a breach there is-special circumstances apart-an effectual and sufficient remedy in the awarding of damages to be paid by the infringer to the patentee. In that way the patentee comes by his own, that is to say, the profit of the invention. Of course, there may be cases in which the infringer is obstinate and irresponsible, will not regulate his conduct by the judgment of the court, and cannot be made to pay for his default. A case like that, no doubt, calls for the extraordinary remedy, and if an injunction makes such a defendant Eable to imprisonment for a repetition of his breach, that would be entirely in conformity with the whole spirit of our law. But that, in fact, is not what happens. I do not suppose that there is a Judge upon our Bench who ever had to consider an application for an injunction based upon the ground that the infringer acted with knowledge that what he was doing was uniawful, or was persistent in his acts of infringement, or was an irresponsible person who could not be made answerable for damages and costs if these were awarded against him. Arguments like those would be treated as superfluous at the present day. The Act of 1852 gave to the courts a large power to grant injunctions in patent actions, a power which was still further enlarged by the Act of 1883.

But whereas in 1852 the power was exercised with discrimination and more or less upon the principles just discussed, the courts now think it always fit to grant an injunction as part of the ordinary remedy in an ordinary case if the plaintiff succeeds.

You will now have no difficulty in perceiving how this new practice of the courts is exploited by the toll-collecting patentee. In the Blackley red case, for example, there was no question as to the extent of the injury suffered by the patentee, or whether he had suffered any injury at all. The fact that neither he nor anybody else could make a profit out of his manufacture did not enter into the reckoning, in fact there was no reckoning at all. The court was satisfied that the invisible, intangible, instantaneous brown stage in the red dye manufacture was infringement, and violated the patentee's exclusive right to make a loss by working the patented invention. So an injunction issued to restrain that improvident proceeding on the part of L, and incidentally, to restrain also his working of the very profitable manufacture of the red dye stuff which was his own invention. The commercial result in the case which I have mentioned was a great calamity, for not only did the control of L's invention pass into B's hands, but a large dependent dyeing industry passed bodily from Lancashire to Holland. The Lancashire dyers were compelled to allow the trade to pass into the hands of Dutchmen, for they were unable to obtain the dye either from the man who had invented, but was restrained from making it, or from the man who controlled the manufacture, but refused to supply it to them on equal terms with more favoured customers abroad. Thus a patent in which there is not a pennyworth of profit may be made the instrument of an extortion by which a prosperous trade, to the establishment and prosperity of which the patentee has contributed nothing whatever, may be reduced under his control, and taxed or destroyed for his emolument or for the consolidation of his grip upon our trade.

There are other ways in which a patentee can extend his privilege to the control of a trade which he has not himself either created or improved. He may, for example, be the patentee of an improved form of mantle for incandescent gas lamps. His mantles may be so highly efficient as to be in great request. But he may think that he would like to monopolise not only the trade in his own mantles, but also the trade in gas burners of the Bunsen type. If so, it is quite a simple

thing for him to sell his mantles with a condition that they shall only be mounted upon Bunsen burners bought from him. In a case like that the law was actually laid down in the year 1895 by a Judge of the Queen's Bench Division in these terms:

"The patentee has the sole right of using and selling the articles, and he may prevent any body from dealing with them at all. Inasmuch as he has the right to prevent people from using them or dealing in them at all, he has the right to do the lesser thingthat is to say, to impose his own conditions. It does not matter how unreasonable or how absurd the conditions are."

It

I have quoted this judgment textually because I should not hope, had I ventured to paraphrase it, to escape the suspicion of having travestied the doctrine of the Court. is, perhaps, open to me to add that, although somewhat strongly expressed, this dictum may be taken to be substantially in accordance with the prevailing judicial view at the present time, so that an argument founded on the provisions of the statute law and of the patent grant itself for protecting the free industries of the realm, and preventing hurt of trade and inconvenience to the public, falls upon deaf ears when addressed to English Judges.

This encouragement afforded to patentees to exercise their ingenuity in preying upon other people's trade, has, of course, borne fruit, not only in one or two, but in a great variety of ways in recent times. One of the most subtle and, as I venture to think, one of the most dangerous by reason of its subtlety, may be illustrated by the following imaginary case. A patentee, whom I will call S., invents a sewing machine suitable for the manufacture of shoes. It is an excellent machine, and greatly cheapens and improves the manufacture. He takes a patent, and, being a man of capital, sets up the manufacture of his own machines. So far all is well. He is carrying out precisely the object for which the patent was granted to him. But on the principle that he may attach any conditions, however unreasonable, to the use of his invention by the public he refuses to sell his machines when made, and will only let them out on hiring agreements. Into these agreements he introduces conditions as to the purchase of thread and other materials, which enable him to create a business in those commodities, which is restricted to himself, and so, little by little, to build up a system of tied houses in the shoe trade. If his machine is good enough it will, of course, enable his dependents

to beat other manufacturers in the competition of the market, and will eventually place the lucky patentee in such a position of financial control that the whole trade will have to do his bidding. Ultimately, when his patents lapse, it will be found that his business position is so strong that he will be able to take the profits of the shoe manufacturers just as a brewer takes the profits of the innkeepers whom he puts into his own public houses. When that stage is reached there will of course be no further improvement in

that trade.

The original inventor has no motive to invent further even if he is still able so to do, and it is his business to see that no other inventor shall poach upon his preserve. The first advance was real, the initial advantage substantial, but the doctrine that a patentee is entitled not only to the profit, but, also, to the control of trade, is a ruinous doctrine in the end, and leads to that melancholy issue that "one good custom should corrupt the world."

I will ask you to bear with me if I advance yet another case in illustration of this point and of the many aspects which it wears, although I am very conscious that I must not consume your time this evening with the mere recital of facts. In this case, however, the recital will be more than mere fact, for the facts themselves sufficiently appear from the judgment which I propose to cite; and again, lest I should be suspected of inaccuracy, I will cite the judgment by the textual quotation of the important parts. The judgment was delivered so lately as July, 1904, and deals, not in general propositions merely, but expressly and in terms with the point which we are now considering. It expresses, therefore, in the most pointed and authentic form the law with which Patent-law reformers have to deal:

"The case raised by the defence," said the learned Judge, "is one of a most unusual character. Each patent is admitted to be useful; it is admitted that the invention is properly described in the specification; it is admitted that there is no anticipation. Therefore, so far as the ordinary grounds upon which the question of validity or invalidity is discussed in this court, it is admitted that the patents are valid. But the defendants raise this defence, which I will state shortly without reading the particulars of objections. They say the patentee never intended to manufacture, and does not manufacture, the dyestuffs in this country, and makes use of his patents to prevent other persons from doing so, and they say further that he makes use of the privilege granted to him by the patents-to put it shortly-by selling the dye-stuff at an exorbitant and unreasonable price,