## Facts

- Singer Manufacturing Co. was the only U.S. manufacturer of household zigzag sewing machines and held a large share of U.S. sales; Japanese manufacturers were gaining share by offering lower-priced machines.
- Vigorelli (Italy) and Gegauf (Switzerland) were European competitors with U.S.-relevant patent interests in zigzag sewing machine technology.
- Singer and Vigorelli entered a 1955 cross-licensing arrangement in which each agreed not to challenge the other’s patents and to grant nonexclusive, worldwide, royalty-free licenses.
- Singer learned Gegauf had a patent application likely to prevail over Singer’s position in the Patent Office, creating leverage and litigation risk among the firms.
- Singer, Vigorelli, and Gegauf pursued coordinated dealings framed around a shared concern about Japanese competition in the U.S. market.
- The firms implemented cross-licensing on nonexclusive, worldwide, royalty-free terms and included non-challenge commitments affecting patent validity disputes.
- Gegauf sold and assigned an important U.S. patent to Singer so Singer could enforce it more effectively in the United States against Japanese manufacturers.
- Singer used the acquired patent position to bring infringement actions or threats against Japanese firms, allegedly impeding their access to the U.S. market.
- The United States filed a civil action under Sherman Act § 1; the district court dismissed for failure of proof, and the United States appealed directly to the Supreme Court.

## Issues

1. Whether the coordinated cross-licensing, non-challenge commitments, and patent assignment constituted a conspiracy in restraint of trade, violating Sherman Act § 1, by targeting Japanese competitors for exclusion from the U.S. household zigzag sewing machine market.
2. Whether patent rights and related enforcement activity can support antitrust liability when used as part of a concerted plan to restrain trade, including where patent procurement was alleged to involve fraud or deception.
3. Whether a Sherman Act § 1 agreement may be inferred from a course of coordinated conduct without an express written agreement to exclude competitors.

## Decision

- The Supreme Court reversed the district court’s dismissal.
- The Court held that, on the record, Singer, Vigorelli, and Gegauf engaged in a conspiracy to exclude Japanese competitors from the U.S. market in violation of Sherman Act § 1.
- The Court concluded the district court applied an incorrect legal standard by discounting the probative force of the coordinated course of dealings and by requiring more explicit proof of an exclusionary agreement.
- The Court determined that patents did not shield concerted arrangements structured to suppress competition, and that exclusionary use of a fraudulently procured patent could be considered as part of an antitrust violation.

## Legal Principles

- A Sherman Act § 1 conspiracy may be proven by an inferred agreement drawn from a coordinated course of conduct and common objective, even absent an express written agreement.
- Patent ownership and enforcement do not immunize collusive conduct; competitors’ cross-licensing, non-challenge provisions, and patent assignments can violate § 1 when employed to restrain trade or exclude targeted rivals.
- Consolidation of patent control in one competitor for coordinated enforcement against third-party entrants can evidence an unlawful restraint when linked to a shared exclusionary purpose.
- Exclusionary use of a patent alleged to have been procured through fraud or deception may be an element supporting antitrust liability.

## Conclusion

The Court held that coordinated patent cross-licensing and assignment arrangements, coupled with enforcement activity aimed at blocking Japanese imports, established an inferred agreement to restrain trade under Sherman Act § 1, and that patent rights did not protect concerted exclusionary conduct from antitrust scrutiny.


United States v. Singer Mfg. Co., 374 U.S. 174 (1963)