Just Between Ex-Friends

As Henry Ford's "only partner," Irish Inventor Harry Ferguson had done well. Ford produced Ferguson-designed tractors, and Harry Ferguson Inc. sold them, under an unwritten agreement based on "good faith and mutual confidence."

In all, Harry Ferguson Inc. sold $313 million worth of Ford-built tractors (and implements manufactured by 105 subcontractors), and in 1946 alone netted $4.3 million. It was young Henry Ford II who decided that his grandfather had got the short end of the Ferguson bargain. He canceled the deal, and set up his own Dearborn Motors Corp. to make and sell tractors and implements (TIME, July 21). When the new Ford tractors came out, automen thought they looked much like Ferguson's.

Harry Ferguson Inc. tried to make its own tractors. The company bought a Cleveland factory, but the plan fell through. Nobody wanted to put up the $8 million capital he needed. As Dearborn Motors took over Ferguson's suppliers and dealers, the Ferguson company began to fall apart.

Last week, ex-Partner Ferguson played his last card. In New York's Federal Court, he sued Henry Ford II, Dearborn Motors Corp., the Ford Motor Co. and others for $251 million damages. He charged 1) patent infringements, and 2) conspiracy to monopolize the farm tractor and implement business. Ferguson claimed that the Ford Motor Co. had "recognized the validity [of his patents] and placed the statutory patent notice on all tractors manufactured down to June 1947." He wanted to collect triple damages on the 37,000 tractors Ford has made since the split, and other damages for having "virtually rendered the business of the Ferguson Co. unprofitable."

Snapped Young Henry: "The blunt truth about this relationship is that it made Mr. Ferguson a multimillionaire and cost the Ford Motor Co. $25 million in the process." As for patents, the Ford Co. claims Ferguson's had all expired on such features as Dearborn Motors had copied. The rest of Ferguson's "distorted" story would be answered "at the proper time and place," presumably in court.

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