CO885-(15-16) — Page 440

PUBLIC RECORD OFFICE

Reference :-

REPER C.O.885

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ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-NOT TO

16 PUBLIC RECORD OFFICE, LONDON

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of the recent Berlin Conference on Wireless Telegraphy the Companies undertake, if required by the Government, to observe in the United Kingdom and on British ships the provisions (except Article VI.) of the Convention, and of any detailed regu- lations made thereunder for carrying those provisions into effect, and in particular and without prejudice to the generality of the foregoing undertaking the Companies undertake, if required by the Government in relation to shore stations in the United Kingdom and ships equipped with Marconi apparatus for ship-and-shore messages, to accept (without prejudice to their patent rights) the obligation to interchange messages with ships and store stations in the United Kingdom respectively equipped with other apparatus, and to relieve the Admiralty and Lloyds and all other persons with whom the Company have contracted from any obligation arising under their contracts to refuse to interchange messages with ships or shore stations in the United Kingdom so equipped, or to make any compensation in respect of the interchange of such messages.

"Provided that:-

(1.) In every case in the United Kingdom in which the Companies are, or may be, entitled to receive the rate allocated to a shore station in respect of a ship-and- shore message the Companies shall be entitled to receive, until the end of seven years from the date of these Heads of Agreement, an additional rate in respect of every such message interchanged with another system, such additional rate not to exceed the rate allocated to the shore station.

(2.) The Companies shall not be bound under any provision of the Convention to give information as to details of apparatus."

That in consequence of this provision the licences which have been tendered to the Marconi Companies (but not yet accepted by them) contained a clause rc- echoing the provision above quoted, and that assuming a Conference at Berlin to take place within a reasonable time, the Postmaster-General would not press upon the Marconi Companies the obligation to communicate except within the limits of the clause suggested.

That the Colonies, however, were not bound by the Agreement with the Marconi Companies, but that each of the Colonial Governments had been advised not to grant a licence to any company except on condition that if and when the Government adhered to any International Convention on the subject of wireless telegraphy, the licensee agreed to observe the provisions of such Convention, which would, in all probability, include a provision compelling communication with passing ships what- ever the nature of the system used by the ship.

That Marconi's Wireless Telegraphy Company, Limited, understanding that advice of this kind has been tendered to the Colonies, has addressed a letter to the Secretary of State, urging that inter-communication with other systems would

pre- judice their patent rights, and that as they hold their patents from the Crown, such a course is inconsistent on the part of the Government.

That it would be seen that this letter enclosed an opinion of Mr. Warmington and Mr. Astbury to the following effect :-

We are asked: would the Marconi Company probably fail, or at any rate be seriously prejudiced, in an action brought by it for infringement of its British patents against users of infringing apparatus and stations, if such users were able to show that the Company had itself, otherwise than in cases of emergency, eg., ships in distress, made a practice of communicating by wireless telegraphy with ships or stations fitted with such infringing apparatus, or had knowingly allowed its licensees to do so? In our opinion this would certainly be the case."

That the following observations occurred upon the contention of the Marconi Companies.

That wireless telegraphy was carried on by means of certain waves or vibrations passing through or along some substance which in the absence of precise knowledge was called ether. That these waves were produced by an electric current set in motion at one end and received upon electrical instruments adapted for the purpose at the other end. That when the ether wave was produced by an apparatus on one system and received at the other end by an apparatus on another system, each of the communicating parties was using his own system, and not the other system. That when a wave was set in motion it radiated in every direction, and might be picked up on half a dozen different instruments on different systems. That it was not apparent, therefore, how any one person receiving a signal could be said to be authorised by the party producing the signal to use any particular apparatus for

the

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purpose. That supposing a ship equipped with de Forest apparatus communi- cating with a shore station equipped with Marconi apparatus: the de Forest system in producing a signal was not using the Marconi system, but its own, and the fact that the signal so produced was read off by a Marconi apparatus on shore did not seem to amount to any licence to the de Forest Company to use any part of the Marconi invention. That it was suggested, therefore, that even if the action of the Marconi Companies were purely voluntary they might communicate through the ether with other systems, and at the same time institute proceedings for infringement against those systems.

But that the case was stronger than this in favour of the Marconi Companies, for it was suggested that they should accept, as a condition of establishing a station, the obligation to communicate with the rival systems. They were, therefore, not acting voluntarily, but under compulsion, and that they might well plead in any infringement proceedings that their recognition of the possibility of communication with any other apparatus was forced upon them, and that they communicated with- out prejudice to any remedy which they might have for the infringement of their patents by the use of other systems. That this was always understood to be the effect of the words which were introduced at the instance of the Marconi Companies in Article 10 of the Heads of Agreement which has already been quoted. That they undertook in certain events to accept without prejudice to their patent rights the obligation to interchange messages with ships equipped with other apparatus. That these words were understood, not to enable them to contest the obligation, but to save their acceptance of the obligation from the appearance of waiving any rights which they might have of proceeding against other systems for infringement.

That there was also the question whether the use of, say, the de Forest system on the high scas could constitute an infringement of a Marconi patent granted by any particular country. That if such an act could not give rise to infringement pro- ceedings it seemed difficult to imagine that it could be [supposed] in any way to prejudice the Marconi Companies in any proceedings for infringement taken by the Companies in any particular country.

That he was accordingly to request us to advise your Lordship :

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Whether the Marconi Companies would be prejudiced in any action taken-

by them for infringement of their patents by the act of interchanging messages with ships equipped with other apparatus where this interchange was imposed upon the Companies as a condition of an installation of a wireless telegraph station.

We have taken the matter into our consideration, and, in obedience to your Lordship's commands, have the honour to

Report-

That, speaking generally, we are of opinion that the Marconi Companies would be prejudiced in any action taken by them for infringement of their patents by the act of interchanging messages with those using apparatus which is alleged to consti- tute an infringement. We think, however, that this prejudice would not arise in cases where such interchange is imposed upon the Companies as a compulsory con- dition of installation, provided that the Marconi Companies display no lâches in taking action against the users of such other apparatus for infringement, but if, having entered into the agreement suggested, they take no steps within a reasonable time to protect their patents they will be prejudiced by their neglect to do so. think it would be reasonable as between the Marconi Companies and the Colonial Governments that the licences should be granted on the condition that they should not prejudice the patent rights of the licensees, and that there should be no obliga- tion of interchange with any other systems which the Companies might prove to be infringements.

We have, &c.,

The Right Honourable

The Earl of Elgin, K.G.,

&c.. &c.,

&c.

JOHN L. WALTON. W. S. ROBSON

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