Motion Picture Patents Company
Encyclopedia
The Motion Picture Patents Company (MPPC, also known as the Edison Trust), founded in December 1908, was a trust
of all the major American film companies (Edison
, Biograph
, Vitagraph
, Essanay
, Selig, Lubin
, Kalem, American Star
, American Pathé), the leading film distributor
(George Kleine) and the biggest supplier of raw film stock
, Eastman Kodak
. The MPPC ended the domination of foreign films on American screens, standardized the manner in which films were distributed and exhibited in America, and improved the quality of American motion pictures by internal competition. But it also discouraged its members' entry into feature film production, and the use of outside financing, both to its members' eventual detriment.
owned most of the major American patent
s relating to motion picture cameras. The Edison Manufacturing Company's patent lawsuits against each of its domestic competitors crippled the American film industry, reducing American production mainly to two companies: Edison and Biograph, which used a different camera design. This left Edison's other rivals with little recourse but to import foreign-made films, mainly French and British.
Since 1902, Edison had also been notifying distributors and exhibitors that if they did not use Edison machines and films exclusively, they would be subject to litigation for supporting filmmaking that infringed Edison's patents. Exhausted by the lawsuits, Edison's competitors — Essanay, Kalem, Pathé Frères, Selig, and Vitagraph — approached him in 1907 to negotiate a licensing agreement, which Lubin was also invited to join. The one notable filmmaker excluded from the licensing agreement was Biograph, which Edison hoped to squeeze out of the market. No further applicants could become licensees. The purpose of the licensing agreement, according to an Edison lawyer, was to "preserve the business of present manufacturers and not to throw the field open to all competitors."
, a key feature of virtually all motion picture cameras then in use. Edison sued to gain control of the patent; however, after a federal court upheld the validity of the patent in 1907, Edison began negotiation with Biograph in May 1908 to reorganize the Edison licensing system. The resulting trust pooled 16 motion picture patents. Ten were considered of minor importance; the remaining key six pertained one each to films, cameras, and the Latham loop, and three to projectors.
However, the MPPC also established a monopoly on all aspects of filmmaking. Eastman Kodak, which owned the patent on raw film stock, was a member of the Trust and thus agreed to only sell stock to other members. Likewise, the Trust's control of patents on motion picture cameras ensured that only MPPC studios were able to film, and the projector patents allowed the Trust to make licensing agreements with distributors and theaters - and thus determine who screened their films and where.
The patents owned by the MPPC allowed them to use federal law enforcement officials to enforce their licensing agreements and to prevent unauthorized use of their cameras, films, projectors, and other equipment. In some cases, however, the MPPC made use of hired thugs and mob connections to violently disrupt productions that were not licensed by the Trust.
made it more difficult for the MPPC to enforce its patents. The Ninth Circuit Court of Appeals, which is headquartered in San Francisco, California
, and covers the area, was averse to enforcing patent claims. Southern California was also chosen because of its beautiful year-round weather and varied countryside; its topography
, semi-arid
climate and widespread irrigation
gave its landscapes the ability to offer motion picture shooting scenes set in deserts, jungles and great mountains.
The reasons for The MPPC's decline are many fold. The first blow came in 1911, when Eastman Kodak modified its exclusive contract with the MPPC, to allow Kodak to sell its raw film stock, which led the industry in quality and price, to unlicensed independents. The number of theaters exhibiting independent films grew by 33 percent within twelve months, to half of all houses.
Another reason was the MPPC's overestimation of the efficiency of controlling the motion picture industry through patent litigation and the exclusion of independents from licensing. The slow process of using detectives to investigate patent infringements, and of obtaining injunctions against the infringers, was outpaced by the dynamic rise of new companies in diverse locations.
Despite the rise in popularity of feature film
s in 1912–1913 from independent producers and foreign imports, the MPPC was very reluctant to make the changes necessary to distribute such longer films. Edison, Biograph, Essanay, and Vitagraph did not release their first features until 1914, after dozens, if not hundreds, of feature films had been released by independents.
Patent royalties to the MPPC ended in September 1913 with the expiration of the last of the patents filed in the mid-1890s at the dawn of commercial film production and exhibition. Thus the MPPC lost the ability to control the American film industry through patent licensing, and had to rely instead on its subsidiary, the General Film Company
, formed in 1910, which monopolized
film distribution in America.
The outbreak of World War I
in 1914 cut off most of the European market, which played a much more significant part of the revenue and profit for MPPC members than for the independents, who concentrated on Westerns
produced for a primarily American market.
The end came with a federal court decision in United States v. Motion Picture Patents Co. on October 1, 1915, which ruled that the MPPC's acts went "far beyond what was necessary to protect the use of patents or the monopoly which went with them" and was therefore an illegal restraint of trade under the Sherman Antitrust Act
. An appellate court dismissed the Patent Company's appeal, and officially terminated the MPPC in 1918.
Trust (19th century)
A special trust or business trust is a business entity formed with intent to monopolize business, to restrain trade, or to fix prices. Trusts gained economic power in the U.S. in the late 19th and early 20th centuries. Some, but not all, were organized as trusts in the legal sense...
of all the major American film companies (Edison
Edison Studios
Edison Studios was an American motion picture production company owned by the Edison Company of inventor Thomas Edison. The studio made close to 1,200 films as the Edison Manufacturing Company and Thomas A. Edison, Inc. until the studio's closing in 1918...
, Biograph
Biograph Studios
Biograph Studios was a studio facility and film laboratory complex built in 1912 by the Biograph Company, formerly American Mutoscope and Biograph Company, at 807 E. 175th Street, in the Bronx, New York....
, Vitagraph
Vitagraph Studios
American Vitagraph was a United States movie studio, founded by J. Stuart Blackton and Albert E. Smith in 1897 in Brooklyn, New York. By 1907 it was the most prolific American film production company, producing many famous silent films. It was bought by Warner Bros...
, Essanay
Essanay Studios
The Essanay Film Manufacturing Company was an American motion picture studio. It is best known today for its series of Charlie Chaplin comedies of 1915.-Founding:...
, Selig, Lubin
Lubin Studios
The Lubin Manufacturing Company, was an American motion picture production company that produced silent films from 1902 to 1916. Lubin films were distributed with a Liberty Bell trademark.-History:...
, Kalem, American Star
Georges Méliès
Georges Méliès , full name Marie-Georges-Jean Méliès, was a French filmmaker famous for leading many technical and narrative developments in the earliest cinema. He was very innovative in the use of special effects...
, American Pathé), the leading film distributor
Film distributor
A film distributor is a company or individual responsible for releasing films to the public either theatrically or for home viewing...
(George Kleine) and the biggest supplier of raw film stock
Film stock
Film stock is photographic film on which filmmaking of motion pictures are shot and reproduced. The equivalent in television production is video tape.-1889–1899:...
, Eastman Kodak
Eastman Kodak
Eastman Kodak Company is a multinational imaging and photographic equipment, materials and services company headquarted in Rochester, New York, United States. It was founded by George Eastman in 1892....
. The MPPC ended the domination of foreign films on American screens, standardized the manner in which films were distributed and exhibited in America, and improved the quality of American motion pictures by internal competition. But it also discouraged its members' entry into feature film production, and the use of outside financing, both to its members' eventual detriment.
Creation
The MPPC was preceded by the Edison licensing system, in effect in 1907–1908, on which the MPPC was modeled. Since the 1890s, Thomas EdisonThomas Edison
Thomas Alva Edison was an American inventor and businessman. He developed many devices that greatly influenced life around the world, including the phonograph, the motion picture camera, and a long-lasting, practical electric light bulb. In addition, he created the world’s first industrial...
owned most of the major American patent
Patent
A patent is a form of intellectual property. It consists of a set of exclusive rights granted by a sovereign state to an inventor or their assignee for a limited period of time in exchange for the public disclosure of an invention....
s relating to motion picture cameras. The Edison Manufacturing Company's patent lawsuits against each of its domestic competitors crippled the American film industry, reducing American production mainly to two companies: Edison and Biograph, which used a different camera design. This left Edison's other rivals with little recourse but to import foreign-made films, mainly French and British.
Since 1902, Edison had also been notifying distributors and exhibitors that if they did not use Edison machines and films exclusively, they would be subject to litigation for supporting filmmaking that infringed Edison's patents. Exhausted by the lawsuits, Edison's competitors — Essanay, Kalem, Pathé Frères, Selig, and Vitagraph — approached him in 1907 to negotiate a licensing agreement, which Lubin was also invited to join. The one notable filmmaker excluded from the licensing agreement was Biograph, which Edison hoped to squeeze out of the market. No further applicants could become licensees. The purpose of the licensing agreement, according to an Edison lawyer, was to "preserve the business of present manufacturers and not to throw the field open to all competitors."
The addition of Biograph
Biograph retaliated for being frozen out of the Trust agreement by purchasing the patent to the Latham film loopLatham loop
The Latham Loop is used in film projection and image capture. It isolates the filmstrip from vibration and tension, allowing movies to be continuously shot and projected for extended periods....
, a key feature of virtually all motion picture cameras then in use. Edison sued to gain control of the patent; however, after a federal court upheld the validity of the patent in 1907, Edison began negotiation with Biograph in May 1908 to reorganize the Edison licensing system. The resulting trust pooled 16 motion picture patents. Ten were considered of minor importance; the remaining key six pertained one each to films, cameras, and the Latham loop, and three to projectors.
Trust Policies
The MPPC eliminated the outright sale of films to distributors and exhibitors, replacing it with rentals, which allowed quality control over prints that had formerly been exhibited long past their prime. The Patents Company also established a uniform rental rate for all licensed films, thereby removing price as a factor for the exhibitor in film selection, in favor of selection made on quality, which in turn encouraged the upgrading of production values.However, the MPPC also established a monopoly on all aspects of filmmaking. Eastman Kodak, which owned the patent on raw film stock, was a member of the Trust and thus agreed to only sell stock to other members. Likewise, the Trust's control of patents on motion picture cameras ensured that only MPPC studios were able to film, and the projector patents allowed the Trust to make licensing agreements with distributors and theaters - and thus determine who screened their films and where.
The patents owned by the MPPC allowed them to use federal law enforcement officials to enforce their licensing agreements and to prevent unauthorized use of their cameras, films, projectors, and other equipment. In some cases, however, the MPPC made use of hired thugs and mob connections to violently disrupt productions that were not licensed by the Trust.
Content
The MPPC also strictly regulated the production content of their films, primarily as a means of cost control. Films were initially limited to one reel in length (13–17 minutes), although competition by independent and foreign producers by 1912 led to the introduction of two-reelers, and by 1913, three- and four-reelers.Backlash and Decline
Many independent filmmakers, who controlled from one-quarter to one-third of the domestic marketplace, responded to the creation of the MPPC by moving their operations to Hollywood, whose distance from Edison's home base of New JerseyNew Jersey
New Jersey is a state in the Northeastern and Middle Atlantic regions of the United States. , its population was 8,791,894. It is bordered on the north and east by the state of New York, on the southeast and south by the Atlantic Ocean, on the west by Pennsylvania and on the southwest by Delaware...
made it more difficult for the MPPC to enforce its patents. The Ninth Circuit Court of Appeals, which is headquartered in San Francisco, California
California
California is a state located on the West Coast of the United States. It is by far the most populous U.S. state, and the third-largest by land area...
, and covers the area, was averse to enforcing patent claims. Southern California was also chosen because of its beautiful year-round weather and varied countryside; its topography
Topography
Topography is the study of Earth's surface shape and features or those ofplanets, moons, and asteroids...
, semi-arid
Semi-arid
A semi-arid climate or steppe climate describes climatic regions that receive precipitation below potential evapotranspiration, but not extremely...
climate and widespread irrigation
Irrigation
Irrigation may be defined as the science of artificial application of water to the land or soil. It is used to assist in the growing of agricultural crops, maintenance of landscapes, and revegetation of disturbed soils in dry areas and during periods of inadequate rainfall...
gave its landscapes the ability to offer motion picture shooting scenes set in deserts, jungles and great mountains.
The reasons for The MPPC's decline are many fold. The first blow came in 1911, when Eastman Kodak modified its exclusive contract with the MPPC, to allow Kodak to sell its raw film stock, which led the industry in quality and price, to unlicensed independents. The number of theaters exhibiting independent films grew by 33 percent within twelve months, to half of all houses.
Another reason was the MPPC's overestimation of the efficiency of controlling the motion picture industry through patent litigation and the exclusion of independents from licensing. The slow process of using detectives to investigate patent infringements, and of obtaining injunctions against the infringers, was outpaced by the dynamic rise of new companies in diverse locations.
Despite the rise in popularity of feature film
Feature film
In the film industry, a feature film is a film production made for initial distribution in theaters and being the main attraction of the screening, rather than a short film screened before it; a full length movie...
s in 1912–1913 from independent producers and foreign imports, the MPPC was very reluctant to make the changes necessary to distribute such longer films. Edison, Biograph, Essanay, and Vitagraph did not release their first features until 1914, after dozens, if not hundreds, of feature films had been released by independents.
Patent royalties to the MPPC ended in September 1913 with the expiration of the last of the patents filed in the mid-1890s at the dawn of commercial film production and exhibition. Thus the MPPC lost the ability to control the American film industry through patent licensing, and had to rely instead on its subsidiary, the General Film Company
General Film Company
The General Film Company was a motion picture distribution company in the United States. Between 1909 and 1920, the company distributed almost 12,000 silent era motion pictures....
, formed in 1910, which monopolized
Monopoly
A monopoly exists when a specific person or enterprise is the only supplier of a particular commodity...
film distribution in America.
The outbreak of World War I
World War I
World War I , which was predominantly called the World War or the Great War from its occurrence until 1939, and the First World War or World War I thereafter, was a major war centred in Europe that began on 28 July 1914 and lasted until 11 November 1918...
in 1914 cut off most of the European market, which played a much more significant part of the revenue and profit for MPPC members than for the independents, who concentrated on Westerns
Western (genre)
The Western is a genre of various visual arts, such as film, television, radio, literature, painting and others. Westerns are devoted to telling stories set primarily in the latter half of the 19th century in the American Old West, hence the name. Some Westerns are set as early as the Battle of...
produced for a primarily American market.
The end came with a federal court decision in United States v. Motion Picture Patents Co. on October 1, 1915, which ruled that the MPPC's acts went "far beyond what was necessary to protect the use of patents or the monopoly which went with them" and was therefore an illegal restraint of trade under the Sherman Antitrust Act
Sherman Antitrust Act
The Sherman Antitrust Act requires the United States federal government to investigate and pursue trusts, companies, and organizations suspected of violating the Act. It was the first Federal statute to limit cartels and monopolies, and today still forms the basis for most antitrust litigation by...
. An appellate court dismissed the Patent Company's appeal, and officially terminated the MPPC in 1918.
External links
- Before the Nickelodeon: Motion Picture Patents Company Agreements
- ORDERS MOVIE TRUST TO BE BROKEN UP; It Violates the Sherman Law, Federal Court in Philadelphia Holds. EXCEEDED PATENT RIGHTS Government Confers No License, Court Says, to Do What Anti-Trust Law Condemns. 'New York Times October 2, 1915
- History of Edison Motion Pictures: Litigation and Licensees
- Independence In Early And Silent American Cinema