The Manufacturer's Aircraft Association
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In 1917, the US government needed to purchase more airplanes to use in World
War I. Holders of the early patents for and various
intermediate goods needed for airplane production were charging
exhorbitant royalties for use of their patents.
Production of aircraft in the United States had nearly come to a halt
as airplane producers sued each other for patent violations.
In March of that year there were two developments leading to the formation
of the Manufacturers Airplane Association (MAA). An advisory panel (headed by
then-Assistant Secretary of the Navy Franklin D. Roosevelt), recommended
the formation of the patent pool. Also that month, congress passed the
Naval Appropriation Act of the Fiscal Year 1918, which included $1,000,000
for the purchase or "condemnation" of airplane patents.
- Every major producer of airplanes was a member of the Manufacturers Aircraft
Association. Members would pay $200 in royalties to the MAA. Of the money
paid in royalties, 67.5% was paid to Wright-Martin, 20% to Curtiss, and
the rest was put into a fund to pay for administration of the patent pool.
- August 1999. Robert P. Merges
Institutions for Intellectual Property Transactions: The Case for Patent
Pools. Long document focusing on different kinds of collective management
of IP that includes this quotation from
the original text of the Agreement forming the MAA:
To submit claims for compensation in respect to airplane patents or patent rights
hereafter acquired to a board of arbitrators consisting of one member appointed by
the board of directors of the Association (Inc.), another by the subscriber making
the claim, and a third by the other two, who shall determine the total amount of
compensation, if any, to be paid for the same, and the rate of royalty to be paid
toward such compensation by any subscriber desiring to take a license under such
patent. (Art. V, pp. 4-5.)
To waive all claims as against each other for infringements prior to July 1, 1917
(Art. XIV, p. 13); to make various reports and to keep various accounts, etc.