Did the US pay royalties to Mauser or didn't they?

First time I ever heard that story.

I will have to dig out my copy of the Book of the Springfield. I don't have it handy right now, but as I remember it, it said that royalties were paid to Mauser for the M1903 rifle. These royalties ceased with the US entry into WWI.

If some one can verify the other story, I would be all ears. I don't think it is going to happen, however. I think some one was confused. I understand, I get that way myself some times.

"ROYALTIES FOR THE USE AND MANUFACTURE OF PATENTED ARTICLES.

The payment by the United States of a royalty for the right to manufacture and use patented articles after the expiration of the term of the patent is not authorized.

The War Department is not authorized to enter into a contract for the payment by the United States of a royalty for the prior use and manufacture of patented devices, such prior use being in the nature of a tort for which the United States is not liable.

(Comptroller Tracewell to the Secretary of War, February 28,

1905.)

By your reference, dated February 21, 1905, of a .communication of the Chief or Ordnance dated February- 17, 1905, you request my decision of the questions therein presented. Omitting paragraphs 5 and 6, the communication is as follows:

"1. I have the honor to inclose herewith proposed articles of agreement between the United States and Messrs. VonLengerke & Detmold, of New York, providing for procuring from them the right to manufacture and use a breech-loading magazine arm, certain features of which are covered by United States letters patent owned by them, on the payment of a license fee therefor.

"2. The appropriations which it is believed authorize the proposed contract are as follows:

Manufacturing, repairing, procuring, and issuing arms at the

national armories (Stats, at Large, vol. 32, p. 942) $1,700,000

Manufacturing, repairing, procuring, and issuing arms at the national armories (Stats, at Large, vol. 33, p. 275) 1,700,000

"These appropriations are available until exhausted, not exceeding two years. (Stats, at Large, vol. 25, p. 833.)

" ' Hereafter all moneys arising from disposition authorized by law and regulation of serviceable ordnance and ordnance stores shall constitute one fund on the books of the Treasury Department, which shall bo available to replace ordnance and ordnance stores throughout the fiscal year in which the disposition was effected and throughout the following year.' (Stats, at Large, vol. 33, p. 276.)

"3. The letters patent enumerated and referred to in the proposed contract were originally taken out by Mr. Paul Mauser, but articles of assignment have been furnished by the Patent Office showing that Messrs. Von Lengerke & Detmold are the owners and are also entitled to all rights and claims which may have arisen under them prior to the transfer to them.

"4. The contract provides for a license fee of $200,000, payable at the rate of 50 cents per arm manufactured, but it is provided in the contract that in case the Government shall manufacture a less number of arms than 400,000 the license fee will be correspondingly reduced, but that for all arms manufactured in excess of 400,000 no license fee will be paid. It is possible, but not probable, that payments of the license fee might extend beyond the date of expiration of the patents. *******

"7. The contract also provides that in case all the arms for which the license fee will be paid can not be manufactured under the present appropriations, the United States shall have the right to renew the agreement under the same terms and conditions.

"8. The contract also provides that the contracting parties shall pay all judgments against the United States on account of any suits or claims which may be made by any persons for infringement of their patents in the manufacture and use of the breech-loading arm and cartridge clip, as covered by the letters patent recited in the contract.

"9. A bond will be required from the contracting parties in the sum of $50,000 to insure the pa3rment of such judgments should any arise.

*' 10. A decision is requested as to whether or not this Department can enter into such a contract to bind the United States. If there are any features in the contract which are not lawful. it is requested that the decision cover such modifications as may be necessary, so that this Department may be enabled to manufacture the magazine arm under the letters patent enumerated and referred to."

From this communication it appears that your Department contemplates manufacturing for the use of the United States, under authority of the appropriations specified therein, breech- loading magazine arms containing certain improved devices for which letters patent have been granted and are still in force, and are now owned by Messrs. Von Lengerke & Det- mold, and that you propose to enter into a contract with them by which, in consideration of a license to the United States to manufacture and'use said improved devices, the United States will agree to pay the said owners of said letters" patent as compensation for said license a royalty of 50 cents on each arm manufactured, not to exceed in the aggregate $200,000.

If the said owners of the said letters patent have thereunder the exclusive right to manufacture, use, and sell the improved devices to be used in the arms to be manufactured and used by the United States, I am of opinion that, under the appropriations specified, you are authorized to enter into a contract with them for the purpose specified, and to provide therein for the payment of reasonable compensation for said license.

But there is one feature of the proposed contract that is not free from doubt. If the contract provided for the payment of a royalty for the manufacture and use of improved devices for which one letters patent only had been granted, I do not think you would be authorized to provide therein for the payment of the royalty for the manufacture and use of the devices after the expiration of the term of the patent. In the case presented seven distinct letters patent are specified, which were granted on six different dates. It is presumed that each letters patent was granted for a term of the same length, beginning on the date when granted. The terms of six of the letters patent 'frill therefore expire at different times. The improved devices for which the several letters patent were granted may also have different values. If. under this state of facts, the royalty which it is proposed to pay is the aggregate value of all the improved devices for which the seven letters patent were granted, I do not think the terms of the contract submitted would authorize the payment of the full amount of the royalty after the expiration of the term of one or more of the letters patent, and in such case the terms of the contract do not provide what amount of royalty should then be paid.

It may be, however, that in fixing the amount of the royalty allowance was made for the differences in the time of expiration of the terms of the letters patent and for the difference in the value of the improved devices, and that the amount agreed upon is deemed appropriate compensation to be paid for the manufacture and use of the improved devices during the varying terms of the several patents until the expiration of the term of the patent of latest date. If,so, I think this intention should be made clear in the terms of the contract.

There is another feature of the proposed contract which requires particular consideration. In paragraph 5 of the communication of the Chief of Ordnance he says:

" 5. The contract also provides for making payment of the license fee for all arms manufactured subsequent to March l*i. 1904. The reason for the insertion of this date in the contract is that on that date this Department addressed a letter to the AVaffenfabrik Mauser, the owners of the letters patent described and referred to before the transfer was made to Messrs. Von Lengerke & Detmold, in which letter reference was made to the making of an agreement providing for the payment of royalties in case any of the features of the magazine arm no*v being manufactured by the Government was covered by any of the letters patent owned by the Wafl'enfabrik Mauser."

The letter to the Waffenfabrik Mauser, to which he refers, is as follows:

"1. As an examination would seem to indicate that some of the features of the cartridge slip recently adopted for the United States Armv mav be covered bv vour United States letters patent Nos. -402605, 482376, and 547932. it is requested that your attorney in this country call at this office for the purpose of determining what, if any. of its features are eovered by your patents, and if .so, to arrive at an agreement as to the royalties which should be paid therefor."

In paragraph 6 the Chief of Ordnance further says:

"6. It is the understanding of this Department that the writing of this letter constitutes an implied contract under which a license fee may he paid the owners of the letters patent enumerated and referred to, and the proposed contract accordingly makes provision for this payment. A copy of the letter referred to is inclosed."

I do not concur with the Chief of Ordnance in the opinion that the letter to the Waffenfabrik Mauser, referred to by him, constitutes an implied contract for the payment of a royalty for the manufacture and use of the improved devices for which the letters patent mentioned therein were granted. This letter suggests that some of the features of the "cartridge clip" which had been " recently adopted" for the Army ''may be covered" by those patents. It does not indicate whether any of the cartridge slips had been manufactured or not. It then requests that an attorney of the Waffenfabrik Mauser call for the purpose of investigating the question of infringement, and, if it should be 'found that there was, ''to arrive at an agreement as to the royalties which should be paid therefor.'1'

The letter and the facts presented leave in doubt the question whether the proposed agreement for compensation had reference to cartridge clips which had been manufactured or were to be manufactured. In the former case no compensation would be authorized, for the infringement would be in the uuture of a tort, for which the Government would not be liable. In the case of Russell v. United States (182 U. S., 535), which was a case of the infringement of a patent by the manufacture and use by the United States of the Krag- Jorgensen rifle, the Supreme Court said:

"If petitioners have suffered injury it has l>een through the infringement of their patent, not by a breach of contract, and for the redress of an infringement the Court of Claims has no jurisdiction. This doctrine may be technical. If the United States was a person, on the facts of this record, * * * it could be sued as on an implied contract, but it is the prerogative of a sovereign not to be sued at all without its consent or upon such causes of action as it chooses. It has not chosen to be sued in an action sounding in tort. * * *"

Until an agreement has been entered into for compensating an owner of a patent for the manufacture and use of any device for which such patent has been granted the manufacture and use thereof is an infringement, and if the infringement is by the United States compensation can not be recovered for the injury.

I am therefore of opinion that you are not authorized to to enter into a contract to pay royalty for the prior manufacture and use by the United States of any of the devices referred to. "

Patent Infringements for which Royalties were paid:

• 467180 , Shell Extractor 20 cents per arm
  
• 477671, Shell Extractor & Collar 5cents per each arm.
  
• 482376, Clips, (called cartridge holder for magazine guns) 50 cents per thousand clips
  
• 527869, Oct, 1894 , Magazine 25 Cents per each arm.
  
• 547932, Clip (called cartridge pack) 50 cents per thousand clips.
  
• 547933, Safety, covered by 590271
  
• 590271, Sept, 1897 25 cents per each arm

Google Books: Decisions of the Comptroller of the Treasury Volume 11

http://books.google.com/books?id=gN1DAAAAIAAJ&pg=PA492&lpg=PA492&dq=decisions+of+the+comptroller+1905+mauser&source=bl&ots=UQEk_URiDa&sig=bsyuYh3HHtXlvFowEAgu2ZgUG1w&hl=en&ei=iSmnSuz6FaKNtgepq-WnCA&sa=X&oi=book_result&ct=result&resnum=1#v=onepage&q&f=false

US Patent Office. Patents of Fabrik Mauser, Paul Mauser

http://books.google.com/books?id=gN1DAAAAIAAJ&pg=PA492&lpg=PA492&dq=decisions+of+the+comptroller+1905+mauser&source=bl&ots=UQEk_URiDa&sig=bsyuYh3HHtXlvFowEAgu2ZgUG1w&hl=en&ei=iSmnSuz6FaKNtgepq-WnCA&sa=X&oi=book_result&ct=result&resnum=1#v=onepage&q&f=false

The court case that was eliminated by WWI was a claim by another entity of patent infringement for the Spitzer Bullets in the US cartridge of 1906.

I have written somewhere in one of these contemporary books (maybe Hatcher) that patent infringement was challenged, monies past and future were awarded but nothing was paid.

I'll be looking for that reference.

YES

I saw it on sons of a gun last night. YES THE US DID. I cant remember the amount but it seems like it was $20,000. Remember that was in 1900AD dollars.

ApacheCoTodd said:

I have written somewhere in one of these contemporary books (maybe Hatcher) that patent infringement was challenged, monies past and future were awarded but nothing was paid.

I'll be looking for that reference.

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This is what I remember hearing. i do not remember if anything actually was paid but WWI ceased any payments not yet made.

There was a settlement with an initial payment. I don't recall the amount but it wasn't a lot all things considered. I think it was around 500K which included past and production period royalties. It was clearly a patent violation and the US made out pretty good on the deal.

Perhaps not exactly on topic, but worthy of note...

...little lower than Wikipedia as a reference source

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Wikipedia information should always be verified before it is used in any sort of academic or legal paper (or anything that just has to be right), but a source cited in a Wiki article is often the exact source or will lead to the exact source needed to provide that verification.

I teach my students to use Wiki as a tool, but not a source.

4. The contract provides for a license fee of $200,000, payable at the rate of 50 cents per arm manufactured, but it is provided in the contract that in case the Government shall manufacture a less number of arms than 400,000 the license fee will be correspondingly reduced, but that for all arms manufactured in excess of 400,000 no license fee will be paid. It is possible, but not probable, that payments of the license fee might extend beyond the date of expiration of the patents. *******

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I provided the actual correspondence between the Comptroller of the Treasury and the Secretary of War above. Why is there continued speculation about what or whether it was paid?

The Comptroller approved the license terms above of $200,000 for all arms at and beyond 400,000. He refused proposed payment of license fees that might extend beyond the expiration of patents.

That litigation which was ended by the start of WWI, and for which no payments were made, related to claims by a different German entity relative to patents on the spitzer bullet used in the 1906 cartridge.

RPRNY said:

I provided the actual correspondence between the Comptroller of the Treasury and the Secretary of War above. Why is there continued speculation about what or whether it was paid?

The Comptroller approved the license terms above of $200,000 for all arms at and beyond 400,000. He refused proposed payment of license fees that might extend beyond the expiration of patents.

That litigation which was ended by the start of WWI, and for which no payments were made, related to claims by a different German entity relative to patents on the spitzer bullet used in the 1906 cartridge.

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Because judgements do not equal payments. I'm quite certain that at best a marginal initial gesture was made but between continued legal wrangling and eventually the outbreak of what would become WWI (long before our own 1918 entry) the entire judgement was set-aside.

On April 5 1905 the Treasury approved royalty payments of 75 cents per rifle plus 50 cents per thousand clips, up to a ceiling of $200,000. Seven months later, on Novemeber 6, Mauser’s accountants were pleased to receive the first (for $11,367.53) in a four-year-long series of checks adding up to the $200,000 maximum.

[General William Crozier who became Chief of Ordance of the Army in 1901 overseeing production for the nation's weapons] made an energetic start on the new .30-06 bullet, introduced on October 15, 1906. Early the following year he received an ominous visit from a very polite but insistent representative of Deutsche Waffen Munitionsfabriken (DWM), maker of the Spitzer bullets for the Mauser rifle. The .30-06, he said, was a near-copy of DWM’s “projectile for hand-firearms”, which had been submitted to the Patent Office on February 20, 1905–about the same time, suspiciously, that Crozier had been finalizing the financial details of the settlement with Mauser–and approved on January 22, 1907.

The good news was that DWM had a far weaker case than Mauser’s–it was difficult to demonstrate that the shape and dimensions of such a common item as a bullet were unique–and Crozier’s patent attorneys advised him to fight the case. Crozier, again fearful that the newspapers would find out about this charge (even if it was trumped up by an opportunistic DWM), decided to fend off the accusers by stalling. He appointed his deputy, Lieutenant Colonel John Thompson (inventor-to-be of the famous tommy gun), to take care of the negotiations in the hope that they would go on for years.
…
In the summer of 1914 [8 years after the accusation] his deputy Thompson had finally run out the clock regarding Ordnance’s alleged infringement of DWM bullet patents. DWM had made repeated offers to Thompson asking him to settle quickly, and each time they had been rebuffed. On July 18, 1914, less than a month before the outbreak of the cataclysmic Great War, in which millions of men would be killed by pointed bullets, DWM finally lost its patience and sued the government in the U.S. Court of Claims for royalties on 250 million Spitzer bullets totaling $250,000. Ten days later, when Austria-Hungary declared war on Serbia, the suit was deferred.

Crozier’s position was saved by the sinking of the Lusitania in 1915 and the U.S. declaration of war on Germany in April 1917. Upon entry to the war, under authority of the Trading with the Enemy Act, the government created the Office of Alien Property Custodian to oversee the seizure of enemy-owned or enemy-controlled assets. To Crozier’s immense relief, the DWM patent was ruled to be U.S. property, and the attorney general dismissed the company’s suit out of hand.

Crozier retired in 1919 and escaped the censure for the fallout from a reinvigorated lawsuit launched by DWM in 1920 [two years after the WWI ended]. Having given up on obtaining a favorable patent-infringement judgement, DWM’s lawyers focused on whether the alien property custodian’s seizure of the patent had been lawful. Impressed by DWM’s argument that its bullet was protected by previous treaty, a tribunal ruled the U.S. government in violation and awarded DWM damages of $300,000.

Washington immediately appealed the decision, and the case lurched on interminably, for another seven and a half years, until it was finally settled on the last day of 1928, a generation after its beginning. The judgement stood. With interest added on the original $300,000, the United States owed a German company $412,520.55 [for the rights to the bullet they used against Germany in two World Wars].

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American Rifle: A Biography by Alexander Rose, Roosevelt’s Rifle Chapter, Pages 271-278

Feel free to purchase: http://www.amazon.com/American-Rifle-Biography-Alexander-Rose/dp/0553805177

And from the Archives of the Springfield Armory: http://ww2.rediscov.com/spring/VFPCGI.exe?IDCFile=/spring/DETAILS.IDC,SPECIFIC=14177,DATABASE=objects,

Between November 6, 1905, when the Germans received a Treasury check for $11,367.53, and the July 1909 Treasury check for $8,117.25, the U.S. Armory made nine payments to Waffenfabrik Mauser for the specified total of $200,000.

In most aspects, the transaction seems a bargain. The United States was embarrassed, but now had clear title to one of the finest rifles in the world. Everyone seemed satisfied with Crozier's handling of the matter, and on November 19, 1905, President Roosevelt reappointed him to a second four-year term as chief of ordnance....
In 1907, an additional damaging blow was dealt to the new rifle when General Crozier had another German visitor, also bearing patent infringement papers and representing Deutsche Waffen-und Munitionfabriken, Berlin, Germany, the manufacturer of the spitzer rifle cartridge for the German Mauser rifle. This cartridge, the Berlin firm announced, was covered by U.S. patent 841861 issued on January 27, 1907, and the U.S. Army was infringing on itd say the United States copied the whole system, lock, stock, and barrel, infringed on seven or eight German patents, and were forced to pay royalties.

This time, General Crozier assigned the problem of replying to Lieutenant Colonel John T. Thompson, acting chief of ordnance whenever Crozier was absent. Colonel (and later General) Thompson, who was to invent the Thompson submachine gun, went to a gathering of government patent attorneys and listened to their analysis of the situation. Deutsch, they assured him, had a very weak case and told him not to pay. Deutsch, they felt, could be beaten in court.

Colonel Thompson contacted Deutsch and informed them that the United States felt there was no case. When Deutsch pressed for a settlement, Thompson refused. On July 18, 1914, Deutsch brought suit against the United States in the U.S. Court of Claims asking for royalty payments on a quarter-billion M9106 rifle bullets at a dollar a thousand for a total of a quarter of a million dollars. The timing was ironic, just ten days before the start of the worst war the world had ever seen, in which many millions of rounds of spitzers would be fired.
But in 1920, Deutsch reopened its claim in the American court. A U.S. tribunal did not try to determine whether Deutsch had a patent infringement suit. Rather, it focused on the wartime seizure of the German patent, which was covered by a U.S. treaty with Germany. On July 2, 1921, the tribunal stated that the United States was in open violation of that treaty and awarded Deutsch $300,000 in damages. The U.S. government appealed and the case was in the courts for more than seven years before it was finally settled, on December 31, 1928. After twenty-two years of on-again off-again litigation, Deutsch won. With interest, the $300,000 award for damages had grown to $412,520.55 - another Christmas present for the Ordnance Department.

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Or are you still "quite certain"? If so, please provide factual evidence to support your certainty.

Good research there! That should clarify a lot of the myths about these cases.

Now the next question... is it appropriate to consider the Springfield 03 a Mauser?

When the Springfield '03 rifle was rechambered to accommodate the nw cartridge, the result was considered a masterpiece.

Yet, with universal praise ringing in its ears, the Ordnance Department was about to be publicly embarrassed. On March 15, 1904, while the first armory production run of fifty thousand '03s was under way, there were urgent conversation going on behind closed doors in Washington. The words 'patent infringement' were being whispered. Ordnance experts and government patent attorneys, comparing the Springfield '03 rifle and cartridge clip with the Mauser rifle and clip, shifted uncomfortably in their chairs. Patent infringement was evident to every eye. In spite of the armory's design changes, the Springfield rifle was such an obvious copy of the Mauser rifle that Mauser could sue for patent infringement. Worse, he had an excellent chance of winning. The army chief of staff, the secretary of war, and even the president himself had to be informed. The implications were enormous. The Mauser people in Germany, would soon enough have some examples of the new Springfield '03, and their patent lawyer would be knocking on the door of the Ordnance Department.

This was an uncomfortable moment for Crozier. The Springfield '03 was his gun. He had been associated with it from the beginning when he was still a captain. As indicated, President Roosevelt made no secret that he wanted the German weapon for the U.S. Army. Author James Fallows states flatly that Roosevelt 'ordered the War Department to buy Mausers for American troops.' But, Fallows adds, 'there was little enthusiasm in the army for a rifle that came not only from outside its own system but also from outside the country.' Therefore, instead of licensing the Mauser from Germany as the Flager regime had done with the Krag-Jorgensen, General Crozier had come close to duplicating it.

One ordnance expert states unequivocally that the new American rifle was not as good as the German rifle it purportedly copied. 'Various departures were made from the German design, and in evey instance the designers had laid an egg. If these departments were made as an improvement, they failed. If they were made with the worthy notion of avoiding royalty payments to Paul von Mauser, the inventor of the Mauser action, they also failed.

On March 15, 1904, an official letter, over the name of Brigadier General William H. Crozier, Chief of Ordnance, was addressed to Waffenfabrik Mauser, Wurttemberg, Germany. The letter said, 'As an examination would seem to indicate that some of the features of the cartridge clip recently adopted for the United States Army may be covered by your United States letter patent NOs. 402,605; 482,376; and 547,932, it is requested that your attorney in this country call at this office for determining what, if any, of its features are voided by your patents and if so, to arrive at an agreement as to the royalties which should be paid therefore. The Germans must have had a solid case. Crozier was wiving royalties at them even before ethe conversation.

On May 4, 19On June 16, 1904, Arthur Frazier met with General Crozier again. The Mauser people, he reported, had now carefully examined the Springfield '03 rifle and clip. As for the clip, the general's expectation there was a patent infringement was incorrect. There was not a single patent infringement on the clip. There were two. General Crosier asked, assuming the U.S. government agreed with Mauser, what kind of arrangement could be made. Mauser, Frazier answered, was asking for a dollar royalty for every one thousand clips made for the Springfield '03. General Crozier took that under advisement.
But the meeting was not over. Frazier stated that the Mauser people had also examined the new Springfield '03 rifle and found not one but five infringements. Mauser required a dollar royalty on each Springfield made.

Arthur Frazier then delivered more disturbing news to General Crozier. The American made Krag-Jorgensen rifle also infringed on Mauser patents. In other words, the United States had been infringing on German-held Mauser patents since 1892, when it first issued the Krag-Jorgensen to its troops. Frazier made a conciliatory offer. If, he suggested, the United States were to be cooperative in a cable arrangement might induce Waffenfabrik Mauser to waive the Krag-Jorgensen infringements. The general took the offer and went off to see his lawyers and his superiors.

On December 22, 1904, the lawyers gave the U.S. Ordnance Bureau another unhappy Christmas. Mauser, they said, clearly had U.S. Ordnance over a barrel. Since the armory had already gone to the enormous expense of obtaining and setting up the production tooling to make the Springfield '03 rifle, the Ordnance Bureau was hardly in a position to dicker unless it wanted to abandon the enormous sum expended on the Springfield '03 rifle and go in search of another rifle.

The general now had no choice but to walk up to the negotiating table with his hands up and his wallet open. At the next meeting, General Crozier and Frazier reached an agreement. After a review by the comptroller of the Treasury and a few revisions, the agreement was submitted through Frazier to his client, Waffenfabrik Mauser, in Wurttemberg, Germany.

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My understanding from the above - again from the archives of the Springfield Armory - is that neither those who had wanted outright purchase of Mausers for the US nor the Mauser technicians or their attorney believed the Springfield '03 to "be a Mauser", ie a knock-off or direct copy. They found and asserted that its design infringed several Mauser patents in the US. Given the stage of intellectual property law at the time, it would seem that patent infringement was their only avenue of redress however.

So, according to the agreement reached between the USG and Mauser, it would appear that the Springfield '03 is not a Mauser. Were that case to have been argued in the latter half of the 20th Century, while not "quite certain", I would opine that the expropriation of intellectual property, Crozier's clear efforts to meet Roosevelt's demands without paying Mauser royalties, and other factors would have led to a broader judgment of piracy. By 1905 law, no, not a Mauser per se.

Very interesting stuff.

I wonder, though, whether the other parts of the Mauser 98 action were simply not covered by patents yet still copied by the Springfield 03. They are darned similar.