Document wg5RZaxnmg00w9dG3babayorJ

General Headcuarteri, Box 91 June 3, 1947 C. F. Raaswaller Booting with Gloss Fibers, Inc. Pile 436-4i A nootlng was held on Boy 27 with the potent attorney and business adrlsor of Glass Fibers* Inc., Col. H. A. Toulmin, potent attorney an) Industrialist of Dayton, Ohio, and a Hr. Mgr, enjoyed by Glass Fibers, Inc. at Toledo as their patent contact nan. Practically the entire discussion on their oart was carried on by Cd. Toulaln. Cd. Toulaln was entirely unwilling to dlsouss any details of the Owens* Corning Fibreglas patent structure, except that he categorically stated several times that they were familiar with all details of the Owena-Cornlng patent structure, that they had, after full consideration, adwised Br. Bernard that his process and equipment did not infringe any data of Owena*Corning uatents. When we tried to discuss the separate features, such as orifice dates, cannosition, viscosity of the melt, fibre diameter, or any other point, he stopped the discussion and said that he was not prepared to ezodln why he felt they did not infringe, and that ws would have to taka his word for it or wait until wa were aware of their operations ao that wa ooold make an Investigation of our own. Ho said definitely that they were unwilling to discuss the Owens-Corning patents in the abstract, for lnstanoa as they would apply to Owens-Corning operation or the operation of an Owens-Corning Licensee or competitor, that their relations with Owens-Corning were good and that he would consider it Improper for him or Glass Fibers, Inc. to appear to conspire with us in attempting to establish that the Owens-Corning Fiberglas patents were Invalid. Ha stated ha had written instructions fro Br. Harry 0. King to advise ua la general terms regarding their operation and to advise us of his conclusions regarding the relation of the Owene-Coming patents to their operations. It developed that Col. Toulmin had really prepared only to show us, again in very general tame, why it would be to the advantage of Johns-Hanville to enter into some sort of oomarelal arrangement with Br. Bernard and with Glass Fibers, whereby wa should obtain the advantage of association with the outstand ing glass fibre production export of the world (Br. Bernard), and to associate with qualified business nan such as Br. Randall Bernard, Br. Harry 0. King, and Hr. Gordon Read, all of whan were finasellly independent and wpebT+ business man. Sinoe this was the only subject Col. Toulnln seemed fully prepared to dlaeuss, we discussed It as far as he was willing to go. Col. Toulnln said that he would recommend to. Glass Fibers, Tne. that they enter into sane sort of cooperative arrangement with Johns-Banville, for which company ha has a high regard on the basis of their reputation in the business world, MTC 017448 wh*r*ln essentially Johna-ManviUe would pat up ths money an4 Mr. Bernard mold sttobIt the technical information necessary to constrnet and operate the plant and the profit* eould be divided between Johna-Manvllle and Glass fibers on seme equitable basis. The arrangements could be such that the stock was divided about squally, In which ease Glass fibers eirht mtroa nortion of the money. On the other heal. It night be like e aemgeaent contract wherein Glass fibers would reoelvw e portion of ths gross sales price for e United nosber of years. Twenty-fire years was Mentioned as e possibility, psrheps a Unit. It might be arranged that Johne--Menvillo would put up all of the capital and give a certain mnber of preferred shares and a snail number of scbbos shares to Glass fibers, Inc. He stated any such nlan would preauns s separate retainer fee for Mr. Bernard Re explained several tines that this was asrw than a patent license, that Mr. Bernard was thoroughly ingenious, one of the few such Individuals in the world, thoroughly faalllar with all details of glass fibre operations. Re ewohaslsed above all that it Is the benefit of Mr. Bernard's knowledge and experience rather than the patent rights which would be of nest value to any outaide oomoany. He referred a few tinea to the fact that these products would undoubtedly out into Johns-Mamrille s sales and that we night just aa wall participate in this drawn glass fibre business ourselves so that we should at least have same control over It. However, he quickly explained that they have a large ncaber of patent snolleatlons on various features of their operations and that they expect very good patent coverage ultimately. They have three issued patents which are drawn to their preliminary work and do not disclose such of their present onerations. These patents wer 2,150,017 2,229,489 2,294,266 These patents have been ordered and will be studied as soon as we receive copies. Both Mr. May end Col. Toulnln were quite sure that the Bernard process would produce not only continuous textile fibres which they have produced during the past nonth, but also stable textile fibres, stable fibres for Insulation, of ths super-fins type fibre, and coarser staple insulation, fibre. The information we wire able to elicit on the construction nr the eoujpwent or -ation of the process was limited. The fumaoes are electrically heated. He would not state whether electrostatically or by electric resistance. He stated the efficiency of the electrical heating was high and that ths nsthod was sntlrely new with Mr. Bernard. Vs believe there Is a fore hesrth In which the approximately final temperatures and ylseosltlss are developed, after which careful control by electric beating Is walatalnsd at ths points of fibre drawing* He did state that this was a oonblnatian of pressure extrusion end dreeing of the fibers. He stated one of the great advantages of thalr nrooess was that ths controls were so effective through the electrical heating that there were few broken fibres and NlTC 017449 that production waa substantially uniform from the beginning to the end o* the ran. Be taid the filaments were "to some extent" self-starting, bnt he did not elaborate. He mould not state whether platinum orifices were need or whether any orifices were used, bat fell baok upon the statement that he assured ns that wa "need not sorry" about the orifices, either as to their operation or as to any con flict with Owens-Coming'a patents. Thus far, they have produced only continuous textile fibres '"Meh thev s+ate they can produce with a finer fibre diameter and with lower epnlament and oDerating coats than Owens-Coming. He agreed to send ns samples. He stated that he would give ns a calculated or Informed guess on equipment costs by stating that one unit will produce 85 lbs. of oontlmous textile fibre in a 24-hour day. Ten such units, producing 850 lbs. per 24 hcwr day, mold involve an investment of about $500,000, not Including building or oower plant, but including a liberal amount as operating capital and contingencies to take care of errors In oanstruction end preliminary operations. One unit for pro ducing 85 lbs. of glass fibre oer day is small and would occupy lass space then one small offloe. It was our understanding from the statements cade that the actual eoet of all glass equipment, including the' glass tank, marble machine, furnaces, electrical heating equipment, controls, etc. would amount to about $25,000 per unit, where a amber of units, ten or more, are Installed, not including the building or the power plant. They have not used this equipment to produce superfine fibre, but they are certain It will produce fibre as fine as the "A" or superfine fibre of OwmnsCominsr. The production per unit would be lower for the finer fibre, perhaps slightly more than ons-half that for the continuous textile fibre, or 45 lbs. per 24-hour day. While the two units which have been constructed have not been run for a sufficiently extended period to give accurate cost data. Col. Toulaln said their operation to date Indicated an actual production oost of 30* less than Owens-Cornlng production cost of the same fibre. One of the two present units hsd been ouerated about a month, the other for a few days. It should be recalled, however, that Owens-Cornine state that they have made some recent changes In their equipment which will result In s production oost sub stantially one-half their present eosts on the stable fibre. I believe this Owens-Cornlng reduced cost dees not apply to continuous textile fibres. Cl Ten!min was very firm la stating they did not Infringe any Owens-Cornlng patents and that If they did infringe. Owens-Corning would not sue then and if Owens-Cornlng should for any reason sue then, he would not hesitate to eall In the Department of Justice and that he was certain the suit would not be continued. He did not make it clear as to whether Owens-Cornlng was in sueh an exposed spot that they would not sue any outside company or whether this attitude was based upon particular information available only to himself or his client. MTC 017450 4 It wu not mad* clear whether Glut Fibers, Tne. would be willlnr to rrarrt Johns-Manvtlle a license tinder their patents (if and when they issue) with a normal royalty payment and with the neoessary technical assistance on correct construction and operation of a plant, but each tins the subject was arrvoaehed Col. Toolain toned to the proposal for a cooperative oonoany or a cooperative operation which he considered acre advantageous to all concerned. He rede it quite clear that he considered the selling of the "know how" on s cooperative basis to be wore Important than the exact patent protection which wight be acquired. For the continuous glass textile fibre. Col. Toolain calculated that with pro duction of 85 lbs. per day frost each unit, the sales from ten units at 81.50 per lb. would be $1275.00 per day. He asamaed that the profits would he approximately 30$ of the sales price, leaving gross profit before taxes of $380.00 for each 24-hour day from the ten units, or awnrorieately *120p00 per year with a total investment of $500,000, exclusive of building and power riant, and with gross sales of $400,000 per rear. He stated these figures were not the result of extensive operations but that they were approximately correct and that any error would be on the conservative side. It should be noted that there is some discrepancy hers. If they produce far 30$ less than Owena-Corning and have only a 30$ profit margin, this would make Owens-Coming profit zero. From Col. Tonlrain's entire attitude, I believe that he is anxious to make tone kind of a tie-up on a eoowereial basis with Johns-Wanville. Tie stated he had no authority to make any proposal to Johna-llsnville but that his statements during this masting sere based upon what he would be prepared to rweonraend to Glass Fibers Inc. and that they generally accented his recommendation. Mr. Bernard was stated to be quite familiar with glass compositions and to have no difficulty in obtaining the exact composition required. They make up their own glass in their own glass tank from which they make the marbles which axe added to the furnaces. A separate memorandm has been prepared on our discussions with Col. Tonlain on natters other than, glass fibre. VCKinp eet R. T. Coss, Manvills Research . S. Williams, Manvills Research Virgil C. Fline MTC 017451