The Patent Pool Solution
In 1917, the two major patent holders, the Wright Company and the Curtiss Company, had effectively blocked the building of new airplanes, which were desperately needed as the United States was entering World War I. The U.S. government, as a result of a recommendation of a committee formed by Franklin D. Roosevelt, then Assistant Secretary of the Navy, pressured the industry to form a cross-licensing organization (in other terms a Patent pool), the Manufacturer's Aircraft Association.
All aircraft manufacturers were required to join the association, and each member was required to pay a comparatively small blanket fee (for the use of aviation patents) for each airplane manufactured; of that the major part would go to the Wright-Martin and Curtiss companies, until their respective patents expire. This arrangement was designed to last only for the duration of the war, but in 1918, the litigation was never renewed. By this time, Wilbur had died (in May 1912) and Orville had sold his interest in the Wright Company to a group of New York financiers (in October 1915) and retired from the business. The "patent war" had come to an end.
Read more about this topic: The Wright Brothers Patent War
Famous quotes containing the words patent, pool and/or solution:
“There is a patent office at the seat of government of the universe, whose managers are as much interested in the dispersion of seeds as anybody at Washington can be, and their operations are infinitely more extensive and regular.”
—Henry David Thoreau (1817–1862)
“I see by the papers that you have once more stirred that pool of intellectual stagnation, the educational convention.”
—Elizabeth Cady Stanton (1815–1902)
“Give a scientist a problem and he will probably provide a solution; historians and sociologists, by contrast, can offer only opinions. Ask a dozen chemists the composition of an organic compound such as methane, and within a short time all twelve will have come up with the same solution of CH4. Ask, however, a dozen economists or sociologists to provide policies to reduce unemployment or the level of crime and twelve widely differing opinions are likely to be offered.”
—Derek Gjertsen, British scientist, author. Science and Philosophy: Past and Present, ch. 3, Penguin (1989)