Myers v. Comm'r
United States Tax Court
Petitioner was the inventor of a rubber-covered flexible steel track, the conception of which invention and drawings he completed prior to January 1, 1930, but had not filed application for a patent at that time. On January 9, 1932, in consideration of certain annual payments to be made to him, denominated "royalties" in the agreement, petitioner granted to B. F. Goodrich Rubber Co. an exclusive license to use, manufacture, and sell the invention.
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Petitioner was the inventor of a rubber-covered flexible steel track, the conception of which invention and drawings he completed prior to January 1, 1930, but had not filed application for a patent at that time. On January 9, 1932, in consideration of certain annual payments to be made to him, denominated "royalties" in the agreement, petitioner granted to B. F. Goodrich Rubber Co. an exclusive license to use, manufacture, and sell the invention. Held, (1) the exclusive license to Goodrich amounted to a sale by petitioner of his invention; (2) it was the sale of property which petitioner had…
1Opinion of the Court
OPINION.
Black, Judge:
In this proceeding the parties are in agreement as to the amount which petitioner received from Goodrich in Í941. Petitioner does not contend that he had any unrecovered cost basis of his invention in the taxable year and he concedes that all that he received from Goodrich was gain. The issue is, What kind of gain? The Commissioner contends that the amount which petitioner received from Goodrich was royalty payments for the use of a patent and is, therefore, ordinary income and 100 percent taxable. Petitioner contends that the payments were received from the sale of a…
2Cases cited8 opinions
- Waterman v. MacKenzieSupreme Court of the United States · 1891
- United States v. General Electric Co.Supreme Court of the United States · 1926
- Hayward v. AndrewsSupreme Court of the United States · 1883
- Oliver v. Rumford Chemical WorksSupreme Court of the United States · 1883
- Brown v. ClarkeSupreme Court of the United States · 1846
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3Cited by150 opinions
- Green v. Comm'rUnited States Tax Court · 1984
- Allen, Collector of Internal Revenue v. WernerCourt of Appeals for the Fifth Circuit · 1951
- Orla E. Watson and Edith Watson v. United StatesCourt of Appeals for the Tenth Circuit · 1955
- Dreymann v. Comm'rUnited States Tax Court · 1948
- Bell Intercontinental Corporation v. The United StatesUnited States Court of Claims · 1967
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