| 2d Cir. | Apr 18, 1893
Tins is a Ml in equity, alleging the infringement oí two patents for fountain pens,- -No. 293,545, dated tfebruaiy 12, 1884, and No. 397,735, dated November 4, 1884, — each granted to Lewis E. Waterman, as inventor. The defendants were originally Asa L. Shipman (who died before final hearing, and whose executor has been substituted) and James D. Shipman and Edward i*. Shipman, Ms sons, who were copartners by the firm name of Asa 1* SMpmaa’s Sons. The questions which have been principally liti.gai.ed are those in reaped of the title to the patents; it being <uristed for (he defendants that the title at the time of the commencement of the suit was in Asa lu Shipman, and consequently that the complainant could not maintain the bill. The facts bearing upon this branch of the case are these: Prior to November 20. 1884, the title to the paten is had been assigned by the complainant to Sarah E. Waterman, his wife, and on November 20, 1884, she granted to him an exclusive license to manufacture and sell the patented improvements throughout the United. States. By the terms of the license he agreed to make full returns on the first day of every monfli of all Jountain pens containing the patented improvements, manufactured by him, and to pay i.o her the sum of 25 cent:: as a license fee for every pen so manufactured on or before the 5th day of every month, for the pens manufactured during the preceding months. The license provided that “upon a failure of the licensee to make returns after thirty days, or to make payment of the license fees after ninety days from the time when such returns and payments are due, then the said Sarah ®. may terminate this license by serving a written notice upon the said licensee; but that will not discharge him from any liability for any license fees due when such notice was given.” November 25, 1884, Mrs. Waterman executed to Asa L. BMpman’s Sons a mortgage of the two patents as collateral security for the payment of a note of $6,500 made by her and the complainant, payable in three years. By this instrument, Mrs. Waterman assigned to the mortgagees all her right, title, and interest in the inventions and the patents upon the express condition that the assignment should he uull and void if she and her husband, or either of them, should pay the note at maturity. It contained also a recital tha t the interest conveyed was free from all incumbrances except a license to this complainant to manufae
On April 27, 1888, the complainant made a tender to the attorney of Asa L. Shipman of the full amount of the judgment obtained upon the note, together with the costs of the suit; but this tender did not include anything for the fees of the receiver in the supplementary proceedings. On the 5th day of May the present suit was brought. The circuit court dismissed the bill, without a written opinion, apparently upon the ground that the legal title to the patent was in Asa L. Shipman at the time of the commencement of the suit.
It is entirely clear, upon the authority of Waterman v. Mackenzie, 138 U.S. 252" court="SCOTUS" date_filed="1891-02-02" href="https://app.midpage.ai/document/waterman-v-mackenzie-92947?utm_source=webapp" opinion_id="92947">138 U. S. 252, 11 Sup. Ct. Rep. 334, that by virtue of the mortgage the whole title to the patents at the time of the execution of the instrument became vested in the mortgagees, subject only to be defeated by performance of the condition or by re
The MU of complaint alleges that the license granted to the complainant was in full force at the time of the commencement of the suit. This averment is not denied by the answer; and the answer makes no issue setting up Ihe invalidity of the Ucease, or any revocation by reason of failure to make returns, or pay royalties, or for any other reason. There is evidence in the record, however, which Iras been referred to, of letters sent by Asa L. Shipman to the complainant, — one of the date of January 9, 1887, and one of the date of April 2d, 1888, — giving notice of the revocation of the license, Under ttse issues made by ihe pleadings, we ought not to notice this evidence. It is j> roper, however, to say that the letter of January 9th did not assign any reasons for revoking the license, and the letter oí April 2í>, 3888. assigned grounds for revoking it which do not appear to have been correct in fact. The complainant was not in default for failure to make returns on the 1st day of January, 1888, or on (he 1st day of February, 1888, or for not paying royalties on riie oth of 'December, 1887, or on January 5, 1888. He did not mnnufacture at ah in the months of December or January, and, if any royalties became due on December 5th or on January 5th, the fact does not appear.
Even if if, were open to the defendant,s. under their answer, to assert that at the time when the suit was commenced the complainant’s interest in the patent had vested in the receiver in supplemen
If the owner of the legal title to the patent had not been made a party to the suit, undoubtedly the bill by the complainant could not be sustained against the other defendants. A mere licensee cannot sue strangers who infringe. In such a case redress is obtained through or in the name of the owner of the patent. But there is no reason or anthority for the proposition that a licensee who has the exclusive right to manufacture and sell a patented article cannot maintain a suit in equity against the owner of the patent, if the latter is guilty of an infringement by making or selling himself, to redress the wrong occasioned thereby, or that such a suit does not arise under the patent laws of the United States. The case of Littlefield v. Perry, 21 Wall. 205" court="SCOTUS" date_filed="1875-02-18" href="https://app.midpage.ai/document/littlefield-v-perry-89002?utm_source=webapp" opinion_id="89002">21 Wall. 205, 223, is a direct authority in favor of the right of the licensee to maintain such an action. In that case the supreme court said:
“A court of equity looks to substance, rather than form. When It has jurisdiction of the parties, it grants the appropriate relief, without regard to whether they come as plaintiff or defendant. In this ease the person who should have protected the defendant against all infringements has become himself the infringer. He held the legal title to the patent in trust for his licensees. He has been faithless to his trust, and courts of equity are always open for the redress of such a wrong. This wrong is an infringement. Its redress involves a'suit, therefore, arising under the patent laws; and of that suit the circuit court has jurisdiction.”
If the licensees’ rights have been infringed by the owner, and third persons confederating with the owner, there is no reason why all the infringers should not be joined as defendants. Perry v. Littlefield, 17 Blatchf. 272" court="None" date_filed="1879-11-10" href="https://app.midpage.ai/document/perry-v-littlefield-8635720?utm_source=webapp" opinion_id="8635720">17 Blatchf. 272, 285. In such a case it is quite immaterial to the other defendants whether the owner, when made a party to the suit, is á complainant or a defendant. It suffices, so far as they are concerned, that all the parties are present who have any interest in the controversy, and that a decree will definitely determine their rights as between themselves and the owner of the patent, as well as between themselves and the complainant.
. The bill in this case alleges a combination between the defendants to deprive the complainant of the benefits and advantages of his license; and the evidence shows that the license granted by Asa L. Shipman to his sons, the other defendants, was granted by him, and procured by them, for the paramount purpose of preventing the conplainant from enjoying the monopoly conferred by his license. The defendants, therefore, are joint infringers. We conclude that there is no impediment, arising from the fact that the complainant is merely a licensee, to preclude him from obtaining the relief sought by his bill.
To sustain the defense of want of novelty the defendants have set up in their answer, and offered in evidence, a large number of patents prior in date to those of the complainant. In the absence of any expert testimony to explain these patents, or indicate what they contain fending to negative the novelty of the complainant’s patents, we do not feel called upon to examine them. There may be eases in which the character of ihe invention has so little complexity that such expert testimony is not necessary to aid the court in understanding whether one patent, or several patents considered together, describe the devices or combination of devices which are the subject-matter of a subsequent patent; but this is not one of them.
The defendants also introduced in evidence a pamphlet entitled “An Expose of the Assumptions and Business Methods of a Dealer and Deputed Inventor,” con si sting of some 25 printed pages, published in 1886. This pamphlet was prepared and published by a rival pen manufacturer apparently for the purpose of discrediting the raven lions oí the complainant, and Me personal character and business methods. The author was called as a witness for the defendants, arid asked this question: “Does (Ms pamphlet, so far as it refers to the paten Is which you have studied, correctly express your views respecting' the same?” The witness answered: “in so far sis it goes, I suppose it does. It was so intended.” Hie pamphlet was then offered in evidence, and made an exhibit in the cause, against ¡he objections of the complainant. The statements contained in this pamphlet are relied upon by the defendants as evidence upon the issue of novelty. We decline to consider anything contained in it as competent evidence upon this istmo. The counsel for the complainant was justified in refusing, as he did, to cross-examine the witness in regard to its contents. The greater part o? if was scandalous matter, entirely irrelevant to the present controversy; and. he was under no obligation to undertake to read and analyze its contents to ace whether it contained anything bearing upon the issue worthy of a cross-examinat!on.
As to the defense rest mg upon the prior .invention of Fisher, it suffices to say that no such defense is set up in the answer; and, if alt that is asserted in respect to the defense is true, only the third claim of patent INo. 3(57,735 would be defeated by it.
We conclude that the complainant is entitled to a decree for an accounting and an injunction. The decree of the circuit court Is reversed, with coste, and the cause remanded (o that court with directions to enter a decree for the complainant in conformity with this opinion.