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effort to enlist outside capital in the venture. In his search for capital he approached bankers, money lenders, merchants, and lawyers. He even offered a share in the venture to talking machine manufacturers and dealers.
Failing to find a single backer willing to advance the necessary funds, he resorted to the expedient of securing a number who were willing to risk a small amount and thus create a fund large enough to permit of the taking of the initial steps. The suit was filed, and thus was begun the agitation which has spread throughout Europe and has reached America--an agitation begun in pure speculation and greed and carried forward by a man who had no other interest in the subject-matter than the gambler's instinct of gain. No author or composer was in the slightest degree interested or concerned, nor could they benfit in any way by the successful termination of the suit begun in Paris in February, 1899. The publishers of music had so little faith in the scheme that they refused to embark a dollar in the enterprise. They were quite willing to talk, however, to let Vives spend his last penny in their behalf if he were so minded.
Beginning of litigation.—The case came on to be heard, and Vives was incontinently beaten and his case dismissed. He appealed, and by this time several years had elapsed, and the public began to talk of the large sums the manufacturers would have had to pay as past indemnity had Vives won. The cupidity of the publishers was aroused, and they realized that Vives was not the simpleton they had first thought him. They saw he had just barely missed the acquisition of a fortune in the form of the past indemnity alone, to say nothing of the royalties of the future. Their gambling instincts were awakened, and they came to his assistance with funds and with promises of social and political influence.
Long before the appeal was argued the rumor spread about Paris that this was too good a thing to go astray, and that it would be seen to that when the appeal was heard Vives would be victorious.
And so it proved. The court of appeals of Paris decided in Vives's favor. The decree of the court is a remarkable document, and it created a sensation as soon as announced. In spite of the fact that there is an old statute which expressly declares that instruments which serve to mechanically reproduce music are not within the prohibition of the copyright law, and that this statute had been more than once upheld by the highest courts, the court of appeals decided that where the music reproduced was accompanied with words there was infringement, but that where music alone, unaccompanied with words, was reproduced there was no infringement. For example, if the soldiers' chorus from Faust be played by an orchestra, a band, or a single instrument of any kind, there was no infringement, but if the words of this air be sung with or without orchestra or other accompaniment there was an infringement.
The court was not unanimous. The president of the court and a sufficient number of the associate justices to give Vives a bare majority joined in the decree. The others dissented and registered their votes in favor of affirming the judgment of the court below.
To render their work as effective as possible, the majority declared the decree to be executory, thereby putting it into force and effect immediately, notwithstanding the court of appeals is not the court of last resort, and notwithstanding the fact that notice of an appeal was given in open court. An appeal has, in fact, been lodged and perfected, and the decision of the court of appeals will shortly be reviewed by the court of cassation--the final court of appeals of France--and it is confidently believed will be reversed by that court.
Reaping the harrest.- Vives has in the meantime, however, reaped the benefit of his little speculation, as he has made the talking machine interests pay, and, in some cases, through the nose. From one concern he received no less a sum than $100.000 for past infringement, besides other large sums for royalty labels, without which they could not continue to sell their records.
Vives, from comparative poverty and obscurity, bounded into affluence and prominence and became a conspicuous figure about Paris. He squandered enormous sums of money in motor cars, jewels, real estate speculations, stock gambling transactions, and building ventures. He is still drawing money from the talking-machine industry. He is said to be without tangible assets, however.
It is quite clear from the above that the original move in this international “ holy war" against the talking-machine industry was a highly speculative venture; that it was not a movement to right wrongs to the author, composer, publisher--none of whom needed protection-but purely and simply a gamble by a rank outsider, without interest direct or remote in the subjectmatter, who was clever and willing to take a sporting chance in the hope of a substantial reward in case of winning out.
As soon as the decree of February 1, 1905, was announced, Vives was inundated with offers of funds and assistance from all directions. The gamblers flocked from all quarters, ready to take hold and stake him for another round or two. Vives made it possible for some of them to get in on the deal, and plans were made for carrying the scheme further. The publishers who had ceded their rights to him tried to take charge of affairs from this point forward, and to oust Vives from control, but did not succeed. Some of the publishers who had refused to cede him their rights now came forward and allied themselves with him in the formation of the present "agency," and still others tried to act independently of him.
Crop of lawsuits.- Endless squabbles have resulted and there are at least a dozen collateral lawsuits now on the docket of the Paris courts between Vives and his original backers, between Vives and publishers, Vives and talking. machine manufacturer, and the latter and publishers.
Twice Vives has been forced out of the “ agency" and his powers intrusted to another. He is out at present, but how long he will remain out is not yet clear.
As soon as possible after the decision in the French case Vives sent his emissaries to England to bring about a deal with the English publishers similar to the one made with the French, but did not succeed. The Englishmen could not be made to see any advantage to themselves in ceding to him any share of their possible rights. They were well organized, and said they could do for themselves all that Vives could do for them, and they started in to do it, but did not get far on the way.
In the first place, English law is different, and English courts are different. The usual hue and cry was raised, and one or two test cases were brought and promptly thrown out of court. Then an attempt was made to cover the case by new enactment. The O'Connor bill was before parliament and an attempt was made to attach a rider to that, but failed, and so for some time to come the speculators in England will not be able to indulge in this particular line of speculation.
The invasion of Belgium.-Vives and his associates invaded Belgium, and they anticipated smooth sailing there. The suit filed there was at the instance of l’ives and his allies. Vives, and not Puccini and Massenet, was the real plaintiff. It was the same old game--the same old speculation. It came to grief there, the gamblers being beaten at every stage, but they were game and carried the case through the court of last resort.
It took time to do this, and in the interval Vives and his methods were being imitated. Competitors sprung up and became active. Some of these competitors came from the ranks of the talking-machine manufacturers, and they stole a march on Vives while he was busy in France, England, and Belgium.
The case was the same everywhere. Only the players were changed.
Entrance of F. M. Prescott in the game.--In 1905—that is to say, as soon as the French decision was announced-the International Talking Machine Company, of Berlin, Germany, began making contracts with German publishers whereby it was granted a monopoly of their publications as to talking-machine records in the event of a decision in favor of the publishers by the courts or the passage of a new law by the German Parliament. F. M. Prescott was the managing director at this time of the International. The latter undertook to bring a test suit at their own expense against a competitor. The same old speculative game again.
In Italy the International had a connection in the talking machine company known as Fonotipia. Many of the shareholders in Fonotipia were shareholders in the International, and some of the directors of the International filled similar positions with Fonotipia.
Fonotipia made contracts with the leading publishers of Italy, including Ricordi and Sonzogno, whereby they secured a monopoly of their publications. Ricordi was given a block of stock in Fonotipia and made a director.
The Italian decision.-Ricordi began a suit in Italy against the principal competitor of Fonotipia on the same lines as the French case. The decision was favorable to Ricordi. An appeal was noted.
Immediately the decision was announced, Fonotipia came to the front with demands for payment of damages from all makers and renders of talking machine records as the assignees of the rights of Ricordi and Sonzogno. They improved upon Vives's scheme, for whereas in France Vives was allowed the tise of any and all publications upon payment of the regulation tax, in Italy only a part were free. The publications known as “first period” were reserved exclusively by Fonotipia, and no one allowed to use them under any
conditions. As the “first period " embraced every publication less than forty years old, it includes, of course, all of the popular up-to-date music. By this reservation Fonotipia enjoys a monopoly of all that is newest and most popular.
In Italy, as in France, there is an Authors' Rights Society clothed with full power to protect the author and composer. This society has not appeared any. where or in any capacity in the Italian case, and has no interest in the subjectmatter. The promoters and backers of the affair, and the principal, in fact only, beneficiaries are Fonotipia and the little coterie of publishers represented by Ricordi and Sonsogno.
In Hungary the International secured contracts with the principal pubJishers. A suit, similar in all important points with the French, Belgian, and Italian suits, was begun in the name of a publisher against a talking machine company. Back of the publisher, and under contract to participate in the spoils, was the speculator. In this case it is the International which is currently reported to be bearing the expense. Here, too, there is an established Authors' Rights Society with ample powers, but it does not appear in the case, nor has it any interest in the outcome. The lower court in Hungary decided in favor of the publishers. An appeal was noted, and the higher court sent the case back for retrial.
Monopoly of publishers.-In Austria the International has monopoly arrangements with most of the publishers. It is estimated that in Austria and Hungary the firms bound in this way to the International represent 90 per cent of the publishers of the two countries.
Notwithstanding the Austrian law expressly exempts talking machines, a test case has been instituted there on the recommendation of the International.
There is an Authors' Rights Society in Austria, but it does not appear in the case in any way.
In France, Italy, Hungary, and Austria suits are still pending to try this mooted question. In all of them the prediction is freely made that in the final courts the talking-machine makers will win as they did in Belgium.
In not a single instance is the litigation due to a bona fide effort on the part of author, composer, or publisher to prevent improper use of copyright music or to right any other real or fancied wrong. In every instance the motive is the same-a purely speculative effort to secure and maintain a monopoly.
Enormous loss to industry. The loss inflicted upon the talking-machine industry in actual cash paid out has been enormous. What the loss has been in time and the loss of business consequent upon the disturbed and unsettled conditions induced by this agitation it is utterly impossible to estimate.
While Vives does not appear in Austrian and Hungarian fields of operation, it is reasonably certain that he will later should the final decision be in favor of the speculators.
In Italy he has forced them to recognize him—to what extent is not knownby means which are not clear, and it is probable that he will do the same in other countries.
All is not harmonious in the relations of the different groups of speculators. They are quarreling among themselves over the spoils, and there must come a time when a settlement can not longer be postponed.
When that time comes, recourse will be had to the courts, and then all the secret covenants will be revealed, and it is probable that many unsavory details will come to light.
Germany is the next point of attack, and here it will probably take the form of an effort to secure the enactment of a new law. It is possible that a test case will be lodged in the courts, in which event it is certain that the same will be prosecuted by the International at its cost, but in the name of soine complaisant publisher.
With the efforts made in America you are entirely familiar and have already shown to the committee of Congress the existence of the same kind of a deal between the speculators which has characterized each and every movement over here.
Everywhere the same conditions, the same speculative scheme, and the same grasping schemers; “ the same old story in the same old way."
[Editorial reprint from the Musical Age, March 7, 1908.) The story in last week's issue entitled “The men behind ” has attracted unusual attention, disclosing as it does, the real interests back of the agitation against the “ mechanical players" which began in France, spread all over Europe, and is now such a live issue in this country.
After reading it it dawns upon us as never before that it is not an academic but an intensely practical question which members of the Patents Committees of Congress will have up for further consideration soon. In this country we find it is the Eolian Company which assumes the role of “chief speculator," instituting and prosecuting at its own expense a suit against one of its competitors (The Apollo Company) in the name of a publisher (The White-Smith Music Publishing Company). It's the “same old story in the same old way" again. First, we find the Folian ('ompany in possession of contracts from practically all the leading publishing houses in the United States, over eighty of them, whereby the Bolian Company secures for itself:
First. Complete immunity for all past infringements, Second. Absolute and complete monopoly for a long term of years (thirty-five) of all the pieces now owned or controlled or hereafter owned or controlled during the term of the contract by any of these music publishers. Then we find the suit being prosecuted through the courts with vigor by the ablest counsel obtainable, and in anticipation of failure demands upon Congress for new legislation to “right the dreadful wrongs which are being inflicted on the poor composer the manufacturers of mechanical instruments."
When one considers the enormous suns which the speculators in France squeezed from the manufacturers for alleged past infringements, even while the appeal was and is pending, it is interesting to contemplate what might have happened to the independent manufacturers in this country, in the way of injunction suits and suits for damages for past infringements, had the Supreme ('ourt decided in favor of the Eolian Company. But the speculators were unwilling to stake their all on success or defeat in the courts alone, and so it happens that a few days after the White-Smith suit was decided against them in the circuit court of appeals, May, 1906, the original copyright bill with its pernicious “ Paragraph G” emanated from the secret conferences presided over by Librarian of Congress Putnam, which had been going on erer since the decision of Judge Hazel in the circuit court in the White-Smith case.
It is interesting to note in passing that not a composer attended the preliminary conferences at which the Librarian was the chief presiding genius, and that these conferences were not held to right any real or fancied grievance to composers. It was not until later on, when it was apparent to the speculator" that the committees of Congress were perfecly well aware of the game that was being played, and that they were likely to be handled rather roughly, when the Members saw what was being attempted, that the composers throughout the country were called upon to get busy and write to their Congressmen.
We have seen the harvest of letters which followed from composers of every degree and station, and those who loped some day to be composers denouncing the mechanical music pirates " and demanding of Congress their inalienable rights,
What the patent committees of Congress did to the Putnam copyright bill is ancient history now, but suffice it to say that when the committees finally reported their bills, the Putnam bill had been so mutilated and bruised that it was hard to find a trace of the original.
The hopes of the speculators have been rudely shattered by the action of the Supreme Court, and now that the highest tribunal in the land has refused to assist in the accomplishment of their aims the fight is to be renewed before Congress, and it is to be expected that every possible effort will be made to amend the law and pass a bill bringing the mechanical players within the exclusive monopoly granted to the copyright proprietor. The KittredgeBarchfeld bill is the means by which it is hoped to bring this about.
Aside from the great question of constitutionality, which would surely arise to test the validity of such a complete departure in legislation, is the seriousness of passing a law which would result in turning these great industries over to a single group and the consequent ruin of the various independent manufacturers. From the standpoint of broad public policy, it is to be hoped that Congress will not permit itself to be led into experiments in legislation which will upset the laws and usages of a certury, and particularly when it is considered that our present laws and usages are in accord with the laws of England and most of the other great nations.
CLOSING ARGUMENT IN BEHALF OF THE MANUFACTURERS.
STATEMENT OF MR. GEORGE W. POUND, OF BUFFALO, N. Y., GEN
ERAL COUNSEL FOR THE DeKLEIST MUSICAL INSTRUMENT MANUFACTURING COMPANY, OF NORTH TONAWANDA, N. Y., AND THE RUDOLPH-WURLITZER COMPANY, OF CINCINNATI, OHIO.
Mr. Pound. Mr. Chairman and gentlemen of the committee: The first question is, Why are we here? I believe it is wholly within the province of myself, as counsel for my companies, to explain very briefly why it is that we are somewhat on the offensive, perhaps, in this proposition.
Several years ago the Æolian Company, after having sufficiently watered its stock for the purpose of creating a public sentiment favorable to this legislation, put the case of the Apollo Company through the Federal courts. I was informed a few days ago by one of their associates that their first fund of $10,000 has since been reinforced by thirty-five thousand additional dollars, so that the ten million-dollar corporation in New York City could accomplish its purpose.
Their test action in the United States circuit court was a failure. They employed the best counsel in the country. They made every effort, and were consistently and thoroughly ruled against by every court before which they came. There was a reason for that.
I believe it is never advisable to attempt to deceive the court, and I stand before you in the strength of that position-you as the court, and I as attorney for my clients. I desire in all courtesy and frankness, still believing it to be my duty to this committee and myself, to say that the opposition here have not been equally fair. They have been unfair. They have, in your presence to-day, made misstatements of fact that they well knew to be misstatements. All through this hearing they have made misstatements of facts. And not only that, but they have caricatured the committee and its chairman. You have been told that you were unable to perceive the imperial genius of Mr. Reginald De Koven. I have been here in Washington on this matter most of the winter and have not given any banquets or employed any press agents, or given out any interviews to the New York * Sun” or “ Globe," advising, condemning, or otherwise abusing the members of this committee because they would not produce a bill conceived by the Eolian Company in a spirit of iniquitous monopoly, cradled by the music-publishing trust, nurtured by a fund of $75,000, taken from the watered treasury.
I hold in my hand one of the contracts of the Æolian Company. It is various. It is sometimes the Æolian Company and sometimes the Universal Music Company.” It has a number of noms de plume under which it operates in all the countries of Europe and in the United States. This contract is called by them the manufacturers' contract."
Mr. Bowers, superintendent of the sheet music department of Lyon & Healy, of Chicago, stockholders of the Æolian Company, and the man wlio went out and got these contracts, stated before this committee last year that he had “ a bushel of them," and that he had all