203 F. 476 | 6th Cir. | 1913
This is an appeal from an order of the District Court temporarily enjoining appellant (defendant below) from infringing United States letters patent No. 644,077. The patent was granted February 27, 1900, to appellee (complainant below) as assignee of Felix Hoffman, for an improvement made by him in acetyl salicylic acid, known in pharmacy as “aspirin.” The bill is in ordinary- form, except that it contains averments that in a suit in equity for infringement of such letters patent, brought by the present appellee against Edward A. Kuehmsted in the Circuit Court of the United States for the Eastern Division of the Northern District of Illinois, and heard finally on testimony taken by both parties and arguments of their respective counsel, a decree was entered sustaining the patent and ordering an injunction and an accounting (171 Fed. 887) ; that this decree was affirmed and rehearing denied (179 Fed. 701, 103 C. C. A. 243, C. C. A. 7th Cir.); and that a petition for a writ of certiorari was
Appellant appealed specially in this case, moved to quash the service of the subpoena, and filed two affidavits in support of the -motion and in opposition to the granting of the temporary injunction. It is stated in this motion that the service of the subpoena is defective, and the return of the marshal is untrue, because (a) the person named in the return of service was not, at the date of service, and never had been, “an agent of the defendant”;' (b) such person “was not, and never had been, engaged in conducting the business of the defendant”; (c) defendant (appellant) did not then have “and never has had a regular and established place of business within the Eastern District of Michigan”; (d) defendant (appellant) was not then “and never has been, a resident or an inhabitant of the Eastern District of Michigan, and it does not appear from the service of said subpoena that there was personal service upon him”, stating, further, that the motion was “based upon the files, record, and proceedings had in the above-entitled cause, and upon the affidavits of Charles Henri (alleged agent upon whom service was made) and Albert C. Smith (defendant), filed herewith.” It is admitted by the affidavit of Henri that on February 9, 1912, the date of the marshal’s service, there was handed to Henri “a copy of the subpoena, of the bill of complaint, of the order to show cause why an injunction should not issue, and of the notice of motion for a preliminary injunction, all in the said cause.”
“All orders Ailed promptly and completely from my Detroit warehouse, duty paid.”
Henri receives shipping instructions, and also tags and labels, from appellant at Windsor, but just what instructions are given and how communicated do not appear. Henri is the only representative of appellant, and the Detroit warehouse is the only warehouse or place for storage and handling of appellant’s goods, in the state of Michigan. Upon receiving instructions from appellant, Henri fills the orders of customers by “putting up, wrapping and attending to the shipping of packages,” by attaching “shipping tags and labels,” and by delivering the packages “at the post office, the express office, or to the express drivers, or at a freight depot.” It is manifest that Henri must also receive the goods when they reach Detroit in bond, and then place them in the warehouse preparatory to breaking, assorting and storing them for the purpose of conveniently filling and executing sales orders. Fie does not receive orders directly from customers or enter into contracts with them, or receive any money in payment of bills;
Thus negotiations and acts leading up to, though not completing, the purchases and sales of appellant’s goods, are conducted and performed by appellant; but plainly there are a number of other steps to be taken in order to consummate the transactions so begun by appellant individually. Whether goods received in bond are in kind, quality, or condition according to the terms of purchase must, by reason of appellant’s failure to enter Detroit, be ascertained and tested by Henri. Kindred facts must also be determined by Henri as respects sales to customers. The performance of such duties as these necessarily involves an important part of appellant’s business. Appellant’s individual acts do not embrace delivery of the goods (Norfolk & West. Ry. Co. v. Sims, 191. U. S. 447, 24 Sup. Ct. 151, 48 L. Ed. 254; Wheelhouse v. Parr, 141 Mass. 595, 6 N. E. 787; Sarbecker v. State, 65 Wis. 174, 26 N. W. 541, 56 Am. Rep. 624); nor does it affirmatively appear that he selects the carrier where there are two or more reaching any given destination, or fixes the cost of carriage in any case; and, in the absence of such showing, Henri is obviously clothed with implied authority to select the carrier in the one instance, and stipulate for the terms of transportation in the other (Nelson v. H. R. R. Co., 48 N. Y. 504; The St. Hubert [D. C.] 102 Fed. 364; Armstrong v. Chicago, M. & St. P. Ry. Co., 53 Minn. 189, 190, 54 N. W. 1059; 1 Hutch. Car. [3d Ed.] § 108; 1 Clark & Skyles on Agency, § 286); nor does it appear that appellant has anything to do with the manner of storing, or the method and safety of packing, nor that he limits or regulates the control and management exercised at the warehouse or with respect to the goods while stored there. These features are all committed to Henri, and they necessarily invest him with some degree of authority and discretion as an agent, and not merely as a servant. Indeed, Henri’s duties and work cover the entire portion of appellant’s'business that is carried on in the Eastern federal district of Michigan; and since they comprise the last essential acts of performance of appellant’s contracts, they operate to fix the place of performance at Detroit. Johnson v. Chas. D. Norton Co., 159 Fed. 363, 86 C. C. A. 361 (C. C. A. 6th Cir.); Bond v. John V. Farwell Co., 172 Fed. 64, 96 C. C. A. 546 (C. C. A. 6th Cir.); Shaw v. Goebel Brewing Co., 202 Fed. 408, decided by this court January 7, 1913.
It results that sales of the infringing goods are consummated either in Detroit or through the mail or other carriers there which reach the points of destination. The law applicable to such sales would ordinarily be that of Michigan (see decisions last cited), except, of course, in cases like this where the federal enactments apply. If what is done at the warehouse at Detroit, and in that city, looking to the delivery of the goods, were subtracted from whaf is done in Windsor, appellant could not conduct his present business at all. We need not repeat that he has no other warehouse, no other representative, and no stock of goods through which to conduct business, except only at the Woodward avenue warehouse in Detroit. Now, despite' the fact that the preliminary steps are taken at Windsor, it is plain enough that the final and essential acts of infringement in issue are committed by Henri
“In this situation we think this was the transaction of business in behalf of the company by its authorized agent in such maimer as to bring it within the district of New York, in. which it was sued and to make it subject to sen-ice of process there.”
See, also, Mutual Life Insurance Co. v. Spratley, 172 U. S. 602, 611, 19 Sup. Ct. 308, 43 L. Ed. 569; Lumbermen’s Ins. Co. v. Meyer, 197 U. S. 407, 415, 25 Sup. Ct. 483, 49 L. Ed. 810; Houston v. Filer & Stowell Co. (C. C.) 85 Fed. 757, 758; American Steel & Wire Co. v. Speed, 110 Tenn. 524, 539, 75 S. W. 1037, 100 Am. St. Rep. 814; Lee v. Fidelity Storage & Transfer Co., 51 Wash. 208, 98 Pac. 658, 659; Premo Specialty Co. v. Jersey-Creme Co., 200 Fed. 352 (C. C. A. 9th Cir.). It is true that these decisions all relate to corporations and their representatives; and it is urged that substituted service like that authorized here cannot be made upon an agent of an absent or nonresident natural person. This contention is not tenable. Andonique v. Carmen, 151 Ky. 249, 151 S. W. 921; Rauber v. Whitney, 125 Ind. 216, 219, 25 N. E. 186. Indeed, section 48 of the Judicial Code expressly authorizes substituted service upon an agent engaged in conducting his principal’s business in the district in which suit is brought, whether such principal be “a person, partnership or corporation.” This case is not like that of Pennoyer v. Neff, 95 U. S. 714, at page 735 (24 L. Ed. 565), where a personal judgment was held to be without validity, which had been rendered by a slate court in an action upon a money demand against a nonresident of the state, who was served only by publication of summons, no personal service of process being made, and the defendant not appearing. In that case, however, Justice Field expressly recognized the right of a state to “require a nonresident entering into a partnership or association within its limits, or making contracts enforceable there, to appoint an agent to receive service of process.” There, can be no difference in principle between that mode of securing service and the one prescribed by section 48.
Furthermore, since the jurisdiction of the District Courts in patent infringement cases is founded upon an act of Congress, the important token of such jurisdiction is not, in any respect, the character of the parties, but it is the nature of the case, and it ought to follow that, if the conditions existing in any federal district warrant the exercise of jurisdiction by reason of the nature of the case, the fact that an absent alien had created such conditions is of no more significance than if a nonresident native had created them; in short, the status of the parties is simply incidental, and in no wise controlling. As Chief Justice Marshall said nearly a century ago'in Cohens v. Virginia, 19 U. S. (6 Wheat.) star pages 390 to 394 (5 L. Ed. 257), when speaking of the nature of causes and the character of parties involved in suits calling respectively for the exercise of original or of appellate jurisdiction;
“In one description of cases the .jurisdiction of the court is founded entirely on the character of the parties; and the nature of the controversy is not contemplated by the Constitution — the character of the parties is everything, the nature of the case nothing. In the other description of cases, the jurisdiction is founded entirely on the character of the case, and the parties are not contemplated by the Constitution. In these, the nature of the case is everything, the character of the parties nothing. When, then, the Constitution declares the jurisdiction in cases where a state shall be a party to 'be original, and in all cases arising under the Constitution or a law to he appellate, the conclusion seems irresistible that its framers designed to include in the first class, those cases in which jurisdiction is given, because a state is a party; and to include in the second, those in which jurisdiction is given, because the case arises under the Constitution or a law.”
We conclude that the motion to quash was rightly denied, and that the decree below must be affirmed, with costs.
“Sec. 48. In suits brought Cor tho infringement of letters patent, the district courts oí tho United Stales shall have jurisdiction, in law or in equity, in the district of which the defendant is an inhabitant, or in any district in which the defendant, whether a person, partnership, or corporation, shall have committed acts of infringement and have a regular and established place of business. Tf such suit is brought in a district of which the defendant is not an inhabitant, but in which such defendant has a regular and established place of business, service of process, summons, or subpoena upon the defendant may be made by service upon the agent or agents engaged in conducting such business in the district in which suit is brought.”