189 F. 591 | U.S. Circuit Court for the District of Northern New York | 1911
This is a,suit in equity brought by the complainants to restrain the defendants Seim and Reissig from infringing what is known as the Grant patent, dated February 18, 1896, No. 554,-675, and issued to Arthur W. Grant for “rubber-tired wheel.” The validity of this patent has been adjudicated in certain circuits, and its invalidity has been adjudicated in other circuits. It was held valid in the Second circuit by the Circuit Court and also by the Circuit Court of Appeals in Consolidated Rubber Tire Co. & Rubber Tire Wheel Co. v. Diamond Rubber Co. of New York, 162 Fed. 892. In this case on the petition of the Diamond Rubber Company a writ of certiorari was granted, and the case taken to the Supreme Court of the United States, where the patent was held valid and infringed. See Diamond Rubber Co. of New York, Petitioner, v. Consolidated Rubber Tire Co. & Rubber Tire Wheel Co., decided April 10, 1911, 220 U. S. 428, 31 Sup. Ct. 444, 55 L. Ed. 527.
So far as this suit between the parties is concerned, the patent must be considered valid. It has the presumption of validity to start with and the decision of the Supreme Court of the United States sustaining it. However, in Goodyear Tire & Rubber Co. et al. v. Rubber Tire Wheel Co. (Sixth Circuit) 116 Fed. 363, 53 C. C. A. 583, the patent was held invalid, and in Rubber Tire Wheel Co. v. Victor Rubber Tire Co. (Sixth Circuit) 123 Fed. 85, 59 C. C. A. 215, it was also held, invalid. In a case in the Seventh circuit, district of Indiana, wherein the Kokomo Rubber Company was defendant, the patent was held invalid. This last case did not go to the Circuit Court of Appeals.
The defendants here, Seim and Reissig, reside and do business in. the city of Albany, state of New York, Second circuit. It seems to be their contention that they purchase the alleged infringing articles in which they deal and which they sell from or through the Diamond Rubber Company of New York, which, in turn, obtains them from the maker, the Kokomo Rubber Company. In the case above referred to in the Circuit Court of Appeals, Second Circuit, and which went
“Ordered, adjudged, and decreed that the decree of said Circuit Court be and it hereby is amended by inserting ihe following clause: ‘Nothing in this injunction shall prevent or is intended to prevent or enjoin this defendant from handling, using and selling rubber tires and rims covered by the Grant patent, manufactured by the Goodyear Tire & Rubber Company, having a right to manufacture, use and sell such tires, under a judicial decree in the federal courts of the Sixth Circuit, or manufactured by the Kokomo Rubber Company, having a right to manufacture, use and sell such tires under a judicial decree in the District of rndiana, Seventh Circuit; or manufactured bv the Victor Rubber Tire Company, under a judicial decree in a litigation in the federal courts in the Sixth Circuit, wherein in such litigations it has been judicially determined that the said Grant patent is invalid and void.’ And as so amended is affirmed, with costs taxed at the sum of $“1.95.”
The defendants here, as well as the Diamond Rubber Company of New York, contend that, inasmuch as the decree was affirmed with this clause therein, there has been an adjudication that the Diamond Rubber Company has the right to use and sell rubber-tired wheels and the various parts which go to make up the rubber-tired wheel of the patent manufactured by the Goodyear Tire & Rubber Company, or by the Kokomo Rubber Company, or by the Victor Rubber Tire Company, the patent having been held invalid as to them. The contention is also that this right extends to all dealers and users of rubber tires and rims covered by the Grant patent manufactured by either of the said companies, and that they will be able to show that the rubber tires and rims dealt in and sold by these defendants were manufactured by the Kokomo Rubber Company, and that, therefore, Seim and Reissig had a perfect right to use or sell them as they are protected by the decree in the Indiana circuit above referred to, not appealed from or reversed.
That the wheels and parts complained of and dealt in and sold by the defendants are covered by the Grant patent and infringe same cannot be questioned. The first question is, Were these tires and rims made by the Kokomo Company? I have read the affidavits of William Seim, Gustave Reissig, and Dorothy Seim presented and read in opposition to the granting of this motion for a preliminary injunction, and I fail to find evidence therein that either the rims or tires or wheels dealt in by the defendants here were made by the Kokomo Rubber Company or by the Goodyear Tire & Rubber Company or by the Victor Rubber Tire Company, and hence fail to find evidence that these defendants are protected in using, dealing in, or selling these parts or any of them, or the vehicle wheel complained of, even if the decrees referred to protect those companies, and all who purchase from them or either of them against the charge of infringement. I do not need to decide that such decrees do or do not protect those companies and those who deal with them or purchase from them directly or from those who purchase of dealers to whom such companies sell in passing on the question of a preliminary injunction.
The petition for intervention filed by the Diamond Rubber Company of New York alleges, in substance, that it is engaged in purchasing, handling, using, and selling rubber tires and rims decreed to be cov
James D. Hurd, the complainant here, holds an exclusive license under the patent in suit for making and selling these rims and tires and wheels in the state of New York. His license antedates the Indiana decree, to which suit he was not a party. The Diamond Rubber Company desires to be made a party defendant so it may come in in this suit, and raise these question and make this alleged defense in person.
The broad allegations of the petition for intervention must be deemed qualified by the certified copy of the decree filed therewith and which shows that the only right of the Diamond Rubber Company, if any, to make, use, and sell these articles which infringe the Grant patent is derived from the decree of the United States Circuit Court in Indiana. If that decree of the Circuit Court in the action referred to does protect the Kokomo Company against the charge of infringement in making and selling rubber tires, rims, and other parts which in fact infringe the Grant patent, I am df the opinion, and hold, that such decree does not protect users and sellers of those articles made by the Kokomo Company in Indiana in the Second circuit. If it shall be held that the decree of the Circuit Court in the District of Indiana not appealed from or reversed establishes in that circuit that the Grant patent is invalid notwithstanding the decision of the Supreme Court of the United States, still that decree does not establish that as the law in the Second circuit. The decision of the Supreme Court of the United States holding this patent valid must prevail in the Second circuit. It must he the law here that the patent is valid. There is no judgment or decree anywhere that the Kokomo Company has a right as licensee to make and sell these articles under the Grant patent. The decision of the Circuit Court of Indiana is that the Grant patent is invalid — that is, it has no existence. The decision of the Circuit Court of Appeals in the Second Circuit sustained by the Supreme Court of the United States is that the patent is valid.
The effect of the reservation made by the decree of the Circuit Court of Appeals in the Second Circuit is thus stated by the Supreme Court:
*596 “The final contention of the Rubber Company is that the Grant patent having been declared invalid by the Circuit Court of Appeals of the Sixth Circuit and by the Circuit Court for the District of Indiana in the Seventh Circuit, the Rubber Company should not have been enjoined from the handling or sale of tires manufactured in the Sixth and Seventh Circuits, and cites Kessler v. Eldred, 206 U. S. 285 [27 Sup. Ct. 611, 51 L. Ed. 1065]. The Court of Appeals practically reserved the question. It modified the decree of the Circuit Court so far as it prevented the handling, using or selling tires and rims authorized by any judicial decree, recognizing, as it said, the applicability of Kessler v. Eldred. But it further said: ‘Whether it should be given a broader interpretation is a question upon which we express no opinion, deeming it more prudent to wait until the fact's are fully developed. There is no occasion for attempting at this time to anticipate the future for a contingency which may not arise. * * * To provide in a decree that a defendant is not enjoined from making, using and selling devices which do not infringe or which have been licensed, seems unnecessary. The doctrine of Eldred and Kessler, if carried to the extent contended for by the defendant, will introduce radical and far-reaching limitations upon the rights of patentees. These questions may not arise in the case at bar, but if they should, the court should have the facts, and all the facts, before attempting to decide them.’ We concur in these remarks.”
This is far from an adjudication that these defendants have the right to use, deal in or sell rubber tires and rims or vehicle wheels, which in fact infringe the Grant patent, in the Second circuit, because made by the Kokomo Company in the Seventh circuit.
“We need not stop to consider whether the judgment in the case of Eldred v. Kessler had any other effect than to fix unalterably the rights and duties of the immediate parties to it, for the reason that only the rights and duties of those parties are necessarily in question here. It may be that the judgment in Kessler v. Eldred will not afford Breitwieser, a customer of Kessler, a defense to Eldred’s suit against him. Upon that question we express no opinion. Neither it nor the case in which it is raised are before us. But the question here is whether by bringing a suit against one of Kessler’s customers Eldred has violated the right' of Kessler. * * * Leaving entirely out of view any rights which Kessler’s customers have or may have, it is Kessler’s right that those customers should, in respect of the articles before the court in the previous judgment, be let alone by Eldred. and it is Eldred's duty to let them alone. The judgment in the previous case fails of the full effect which the law attaches to it if this is not so.”
In the statement of the case the court says:
“Eldred was a competitor of Kessler’s and manufactured a similar form of lighter (entirety dissimilar from that described in the Chambers patent).”
It was evident to the court that Eldred’s line of conduct was intended and calculated to injure and impair the trade of Kessler by driving away his customers. The validity of the Chambers patent owned by Eldred and which he claimed Kessler infringed was not (so far as appears) in question. In any event, the decree did not go against Eldred and in favor of Kessler upon any theory that the Chambers patent was invalid, but simply on the proposition that Kessler’s lighter, “like Eldred’s,” but “entirely dissimilar from that described in the Chambers patent,” did not infringe the structure covered by the Chambers patent. It well may be that in such a suit really to enjoin an unlawful interference with a man’s business by means of vexatious suits against his customers as between the parties to the prior suit the court has power to intervene and restrain the alleged wrongdoer, one of the parties to that action, at the suit of the other from bringing and prosecuting other actions involving the same precise facts and questions, even though brought against other defendants, and apply the rule or doctrine of comity, thus giving full force and effect to the judgment of the Circuit Court rendered in one district in other or even all districts in the United States.
There is a wide distinction between a holding that a patent is invalid and a holding that a certain manufactured article does not infringe such patent. In Kessler v. Eldred the question was not submitted, and the Supreme Court did not decide that a judgment in the Circuit Court of one district and circuit holding a patent invalid is binding and conclusive of that fact in all other circuits even as between the parties to the suit. Nor did it decide, as we have seen, that such a decree protects purchasers from the defendant in such a suit, who has successfully denied the validity of the patent, who are using and selling the alleged infringing article (made by the defendant in •such suit) in other circuits against the charge of infringement made
In the case at bar the rubber tires and rims in question here were not in existence when the case in Indiana was decided and the decree rendered which is alleged to protect the defendants here. They could not have been á subject of controversy in that suit. The validity of the Grant patent was in issue. Jt was adjudicated that it had no legal existence. Having no existence as to the Seventh circuit, district of Indiana, the making and sale of rubber tires and rims by the Kokomo Company was not unlawful so far as the holder of that patent was concerned. I am of the opinion that this decree conferred and confers no right on the Kokomo Company ‘to perpetually and forever infringe the Grant patent now that it has been held valid by the Supreme Court of the United States whose decision must be the supreme law of the land. Clearly, to my mind, it confers no right on the Diamond Rubber Company of New York, the petitioner for intervention here, to purchase and sell rubber tires or rims or rubber tired wheels made by the Kokomo Company which in fad: infringe the Grant patent, for as to it the Supreme Court of the United States has decided, in a case where it was sued for infringing that patent and where its validity was directly in issue, that the patent is valid, and that the Diamond Rubber Company has no right to make or sell articles covered by it. The exception in the decree of the Circuit Court of Appeals, Second Circuit, went to the terms and extent of the injunction to issue under'it, and the effect of its decree as a whole was to reserve the question here in issue. This is held by the Supreme Court as before stated. In short, unless the decree in the Circuit Court of Indiana, referred to, is a protection to the Kokomo Company and all who purchase and sell tires and rims of its make wherever located and dealing in them, the Diamond Rubber Company of New York and these defendants, Seim and Reissig, are infringers when they purchase and sell and use the articles mentioned in the state of New York, especially those made or purchased and sold here since the de
For these reasons, the petition for leave to intervene is denied, and the motion for a preliminary injunction is granted.