152 F. 178 | 6th Cir. | 1907
This cause was here in 1903 on appeal from a decree of the Circuit Court dismissing the bill. The suit was for the infringement of a patent granted to Canda, September 29, 1891, for the invention of a draw-bar attachment for connecting railroad cars. The number of the patent was 460,426. Being of opinion that the first claim of the patent was valid, and finding that the defendant infringed it, we reversed the decree, and directed the Circuit Court to enter a decree in favor of the complainants in respect of said first claim, and thereupon to proceed to ascertain the profits and damages and to 'grant the usual, relief. The case is reported in 124 Fed. 486, 61 C. C. A. 194. On entering the proper decree in the court-below, a reference to a master was ordered to take proof and state.an account
1. The first question in its order to be considered is whether the complainants were entitled to recover the profits made during the period of infringement while Frederick J. Canda was the sole owner of the patent. The master was of opinion that they could not be recovered in this suit because the other complainant had no interest in them; but the court held otherwise, and allowed them, and we think that in this the court was in error. The general rule is that all the parties suing must have an interest in the recovery in order to warrant a judgment therefor in their favor. Even if that were permissible, the bill did not seek to recover a several decree in favor of one of the complainants for one part of the profits, and a joint decree for another. On the contrary, the complaint was of infringement after the date of the assignment. In support of the ruling of the court in this particular, the learned judge cited Moore v. Marsh, 7 Wall. 515, 19 L. Ed. 37; but that case is not in point for the complainants. The pat-entee, some time after getting his patent, assigned a one-half interest therein to another party. Subsequently the patentee brought a suit to recover damages for infringement committed before the assignment.
“It is clear that unless the plaintiff can maintain the action there can be no redress, as it is too plain for argument that a subsequent assignee or grantee can neither maintain an action in his own name, or be joined with the patentee jn maintaining it for any infringement of the exclusive right committed before he became interested in the patent. Undoubtedly the assignee thereafter stands in the place of the patentee, both as to right under the patent and future responsibility; but it is a great mistake to suppose that the assignment of a patent carries with it a transfer of the right to damages for an infringement committed before such assignment.”
In the case of Adams v. Bellaire Stamping Co. (C. C.) 25 Fed. 270, cited by counsel for complainants, the suit was brought by a single plaintiff, who was assignee of the patentee, and was also assignee of the damages for prior infringements. The question was whether he could recover for prior and for subsequent infringements and Judge Sage held that he could. This was because he was the assignee of the patentee’s damages.' The court below erred in including the profits for this period in the recovery, and the decree must be corrected accordingly.
. 2. The court below also erred in sustaining the defendant’s claim of a deduction for the losses incurred by said defendant during tire third period of the reckoning, and in deducting those losses from the profits which the complainants were otherwise entitled to recover. In the opinion of the court, the cases of the Cawood Patent, 94 U. S. 710, 24 L. Ed. 238, and Rubber Company v. Goodyear, 9 Wall. 788, 19 L. Ed. 566, are cited as authority for the ruling; but these cases only hold that losses occurring concurrently with the gaining of profits may be taken into account — that is to say, if they are losses directly resulting from the particular transaction on which the profits are allowed. Though called losses, they are really diminutions which are taken into account in reaching the resultant profits of the sales on which profits were made. The general statements made by the justices who delivered the opinions in the cases last cited, and which are here relied on as authority for the claim that all the transactions running through several years are to be looked to, and the profits and losses of a continuous'business are to be balanced for a result, do not sustain such a contention. The meaning and authority of such general statements should be limited by the facts of the case in which they were expressed. And it is necessary to impose such limitations in order to make the statements consistent with the law as since declared by the same court. Callaghan v. Myers, 128 U. S. 617, 664, 9 Sup. Ct. 177, 32 L. Ed. 547; Crosby Valve Co. v. Safety Valve Co., 141 U. S. 453, 12 Sup. Ct. 49, 35 L. Ed. 809; Walker on Patents (4th Ed.) § 713.
3. It appears that the proofs before the master included the profits on the bottom plate of the casing, and the report of the master included them. To this the defendant filed an exception, which was overruled by the court. The second claim of the patent included the bottom plate in the combination. The first did not. By reference to our former
4. Another exception of the defendant rests upon the facts that certain earlier patents, two in particular, one to Cushing and another to Thornburgh, had been taken out for “drawrbar stops for railroad cars” and “draft apparatus” for the same, which the defendant says indicate certain features of construction which are embodied in the infringing castings made and sold by the defendant, and which augment the profits wherewith the defendant is charged. The principle upon which this exception is grounded is well settled; but, before it can be applied, it is incumbent on the defendant to prove that the peculiar characteristic features or some substantial part of such peculiarities of the former patents were embodied in the patented articles sold, and that they were of such a character that they probably contributed to the profits. Elizabeth v. Pavement Co., 97 U. S. 126, 24 L. Ed. 1000. On this being shown, the burden of proof is devolved on the party seeking to recover the profits to prove what part of the entire profits are due to the use of his own invention. He must make the separation of values and show to the court how much is his rightful
Here is the rock on which many patent causes have been stranded at' the end of their course, for, though it can sometimes be done, it is generally next to impossible to distinguish the profit due to one rather than another of the characteristics of the article sold, or manufactured to be sold. The price is single, and it would rarely happen that either the buyer or the seller would contemplate the price as made up of components grounded on such a distinction. The facts are similar to those which in other cases would condemn the guilty party to suffer the consequences of his mingling indistinguishably the property of an innocent party with his own or that of another. Counsel for defendant has argued this question upon the theory that the rule laid down in the case of Elizabeth v. Pavement Co. was an exception merely to that stated in Garretson v. Clark, and seems to suppose that, in every case where some element or elements of a combination found in a former patent is found also in the infringing article, the burden is cast upon the plaintiff to prove either that it did not affect the selling price of the article, or, if it did, to show what part of the price was due to his own invention. But such a rule wo.uld be inconsistent with the decision in Elizabeth v. Pavement Co. We think the two cases above mentioned are not inconsistent, and that they are easily reconciled upon the assumption that the rule of the first case is applicable to the question of the burden of proof of showing the presence of the extraneous element and the probability that it has affected the price, and that the rule in the. second case relates to the burden of proof after those facts are established. Thus, in the later case of Keystone Mfg. Co. v. Adams, 151 U. S. 145, 148, 14 Sup. Ct. 295, 38 L. Ed. 103, in summing up the conclusions reached thereon, one was stated to be “that where the infringed device was a portion only of defendant’s machine, which embraced inventions covered by patents other than that for the infringement of which the suit was brought, in the absence of proof to show how much of that profit was due to such other patents, and how much was a manufacturer’s profit, the complainant is entitled to nominal damages only,” from which it seems that the conditions stated must have been made to appear before the rule stated could be applied.
Where the extraneous matter is another invention which is the subject of a monopoly in some other person, the reasons for the rule requiring a distinguishing of profits becomes clearer because of the necessity of preventing a double liability on the part of the defendant; but the reasons for its application to any other case are vague, and the practice difficult. In the present cause the court below held that it was not proven that the inventions of the Cushing and Thornburgh patents, or either of them, were embodied in the casings on which the profits were calculated, or contributed thereto, and in this we entirely agree. An examination of the testimony in the record shows that some of the forms of' parts of the combinations of those patents are to be found in the Canda patent, but nothing which represents any patented device of Cushing or of Thornburgh. Nor do we find any substantial thing deserving of being reckoned as a factor to which a portion of the price was due. It was settled as between these parties by the former decree
There are no other questions of sufficient importance to require discussion. There is a question of costs, but they were in the discretion of the court, and not the subject of appeal.
The decree of the Circuit Court will be reversed, and the cause remanded, with instructions to modify it in accordance with this opinion, and, as thus modified, re-enter it as the final decree of the court.