Selden Patent & ALAM

The Selden patent was an example of someone trying to profit from the work of others by leveraging the legal system. George Selden was a patent attorney who applied his expertise not to protect intellectual property, but to steal ownership of it. Copying an engine design he had seen at an exposition, he filed for a patent for the invention in 1895. Despite the fact that he never produced an engine, the patent office approved his application.
 
The Indianapolis News article in AutoTruce101109 was published October 11, 1909. An industry association called the Association of Licensed Automobile Manufacturers (ALAM) had paid licensing fees to gain control of the Selden patent. This article concerns a "truce" that had been struck between ALAM and several opposing manufacturers who had been part of a rival group, the American Motor Car Manufacturers Association (AMCMA). Those companies were:

• Maxwell
• Premier
• Stoddard-Dayton
• Reo
• Jackson
• Mitchell
• Regal
• Overland 

 
The terms of the announced agreement were for the companies new to the fold to "back" royalties estimated at $2 million. The agreement called for eight-tenths a percent on the list price of every car each company had sold since 1903 - six years. Recently a man referred to as Judge Hough had ruled that the Selden patent was valid. It reportedly pertained specifically to a car's clutch.
 
Noticeably absent from the agreement was Henry Ford, who relentlessly fought Seldon. Finally, in 1911, Selden's claims were struck down in court.
 
The article also introduces a comment that the strategy of the companies capitulating to Seldon and the ALAM was that it could serve as a barrier to entry to the proliferation of manufacturers streaming into the market. The growth of the market was evidenced by the need for the coming New York auto show to expand into two convention centers - Madison Square Garden and Grand Central Palace.
 
Attachment SeldenNews010810 contains an article that is a great reference. It was published in the Indianapolis News on January 8, 1910, or three months after the one analyzed above. The article is really a list. It spells out the companies who complied with Selden patent. That seems difficult to understand as the whole deal with Selden's claim rings of extortion. I won't transcribe all the manufacturers on the list because there are 50 of them (if I counted correctly). Ford, again, is notably absent. Major players like Buick, Cadillac, National, Marmon, REO, Thomas, Overland, Stearns, Pierce-Arrow, Mercer, Packard, and Hudson were among those registered. This was a crazy situation. The companies must have believed it would cost more to go to court than just comply.
 
Another Indianapolis News article that can be found in attachment ReevesNews021210 is relevant to the Selden patent. It was published February 12, 1910. The article is also important in that it reports on work by Alfred Reeves, a force in both motor racing and the auto industry at the time, but largely forgotten today.
 
Reeves is identified as the field secretary of the ALAM. It also referenced a recent meeting at the New York Automobile Show. Apparently, ALAM directors were allocating funds for Reeves to use at his discretion in enforcing the patent.
 
The article also reports that the Selden patent had two more years to run and a new manufacturers' organization was expected to be established at that time. Companies who had recently signed onto the Selden patent include Grabewsky Power Wagon Company, Oakland Motor Car Company, and Randolph Motor Car Company.