The Secretary of State to the President of the Radio Corporation of America ( J. G. Harbord )
Sir: The Department has received your letter of June 3 , 1924,10 with which you transmitted copies of correspondence which you exchanged with Mr. Rudolph Spreckels, Chairman of the Board of Directors of the Federal Telegraph Company of California.
The following statement made in Mr. Brown’s11 memorandum dated June 28, 1924, a copy of which accompanied your letter of June 30 to Mr. Spreckels, is noted:
“… I therefore submit that the Delaware Company is clearly entitled to charges and reimbursement above production cost as above set forth. This subject has been thoroughly discussed with the Washington authorities, without their voicing objections. …
If, as appears to be intended, this mention of “the Washington authorities” has reference to the Department of State, I feel it is due alike to this Department and to your corporation to obviate the possibility of any such misunderstanding as might arise out of the use of the language quoted from Mr. Brown’s memorandum. The Department desires to state, therefore, that while the scope and effect of the contracts between the Federal Telegraph Company of California and the Chinese Government were the subject of discussion [Page 579] on the occasion of several of Mr. Schwerin’s visits to the Department and although, in its letter to you of April 29 , 1924, the Department stated in a general way what its understanding of the obligations of the two contracting parties was, it should be stated that the Department has not considered the relations of the Radio Corporation of America, the Federal Telegraph Company of California and the Federal Telegraph Company of Delaware with each other or the respective rights of those companies, nor has the Department considered the question whether the contracts between the Federal Telegraph Company of California and the Chinese Government include the terms and conditions which are usually contained in such contracts or whether they contemplate the payment of reasonable or excessive compensation for the services to be rendered and the material to be furnished by the Company. This is a question which, of course, the contracting parties should consider and decide for themselves.
In iteration and confirmation of what has already been orally communicated to Mr. Schwerin by representatives of this Department it should be stated that it is not within the province of the Department to negotiate contracts between foreign governments and American interests, and that the Department’s activities in relation to the contracts between the Federal Telegraph Company of California and the Chinese Government have been calculated to obtain a practical application of the principle of the open door in China and to assist the American interests concerned in their negotiations with the Chinese Government to the end that a circuit of communication might be established which would prove advantageous to the relations between the United States and China.
I am [etc.]