JOQ1
FEDERALREPORTERtvol.
61.
,pamphlet, pll;ture, paper, letter. wrltlnS;,.pi:J'I:lt,9r other of an. indecent. ,character, * * · whether SefdOO M tlrst-claB!!l matter or not, are hereby declared to be non mail· able matter.';.. · · And any person who'· shall knowingly deposit,. or cause tobe,c!eposited for mat)ing or delivery, anything declared by this sec· tiQn tQ. .,: .. fined." be:. non., .mallable, *. · · shall, for each and every offense, be
CQunsel,torthe accuse<l claims that ,a private letter in a sealed envelope isnQt within the prohibition of the statute, and cites U. S. v. Warner,5ItJ.j'ed; 355, and U.S. v. Jarvis, Id. 357. The decisions in U. S. v; Cla.rk,43 Fed. 514, and U. S. v. Wilson, 58 Fed. 769, also sustain this view. The contrary is held in Re W 42 Fed. 822; U. S. v. Fed. 918; and U. S. v. Andrews, 58 Fed. 86l. The statute in question dijfers from the former statute in the insertion of "letter" between the words "paper" and "writing." An examinatiQJJ,of the statute, and consideration, of its history and of the foregoing: opinions, Ilnd of the decisions of the supreme court of the Unite(! States upon the questions involved herein, and es· QfU.S. v. Chase, 135 U. S.255, 10 Sup. Ct. 756, have satis· fiedme that cwngress intended, and that the rules ofinterpretation preseribed ipsuch cases 'demand, that this statute be so construed as to embra,eeprivate sElaled letters. No other reason is suggested for the insertion of the· word "letter," wllich has a meaning in itself, distinct fr()Dl the word "writing;" and the proviso "that nothing in this act shall authorize: any person to open any letter or sealed matter of tlle first class, not addressed to himself," forcibly suggests both the protectiOn of ,the privacy of the mails and the prohibition of their use for the transmission of obscene matter. The demurrer, is overruled. EDISON ELECTRIO LIGHT CO.
et al. v. PACKARD ELECTRIC (Circuit Court, N. D. Ohio, E. D. September 6, 1893.) No.
CO.
et
al.
1.
PATENTS-AcTIONS FOR
Adjudications establis:tIing the validity of a patent, after protracted litigation, although not controlling a circuit court In another circuit, authorize it to find the patent valid in a suit for infringement involving the same questions of fact and la Wi
DECISIONS AS TO VALIDITY.
2.
EQUITY PRACTICE-PLEADINGS AS EVIDENCE-ASSIGNMENT OF PATENT.
Averments,ln a bill for infringement ofa patent, that proper and valid assignments ()f the patent were made,' are sufficient proof of title by assignment, where answer under oath is waived, and no affidavits denying the alleged transfer are· offered. OFFICERS AND AGEN'l'S OF NONRESIDENT CORPORATlpN.
3. PATENTS-INJUNOTION AGAINST INFRINGEMENT -
Officers, agents, and stockholders of a corporation, made defendants and served with process in a suit for Infringement of a patent by them while acting for the corporation, may be restrained from such infringement. although the corporation is not a party, and is not within the jurisdiction of the court.
This was a suit by the Edison Electric Light Company and another against the Packard Electric: Company, James 'Ward Packard, and William D. Packard, for infringement .of letters patent.
EDISON ELECTRIC LIGHT CO. 11. PACKARD ELECTRIC CO.
1003
William B. Bolton and Frederick P. Fish, for plaintiffs. E. B. Taylor, Henderson, Kline & Tolles, and A. P. Smith, for defendants. The following cases were cited to the point that the officers, stockholders, or agents ofa corporation cannot be enjoined individually from infringing a patent, when the corporation for which they act has not been served with process: Ambler v. Choteau, 107 U. S. 586, 1 Sup. Ct. 556; Osborn v. Bank, 9 Wheat. 738: Kane v. Candy Co., 44 Fed. 287; Refrigerating Co. v. Gillett 30 Fed. 685; Mexican Ore Co. v. Mexican Guadalupe Min. Co., 47 Fed. 351; Howard v. Plow Works, 35 Fed. 743.
RICKS, District Judge. The complainants in this case file their bill to sustain the validity of the several patents therein set forth, issued to Thomas Alva Edison at the several dates named, and pray for an injunction against the several defendants named, to restrain them from infringing the aforesaid patents. The bill avers that these patents have been held to be valid by the United States circuit court of appeals for the second circuit, and by the various other circuit courts enumerated in the bill. It claims that the title to the patents set forth was duly assigned to the oom· plainants, and offers affidavits establishing the fact that the defendants are infringers. The first defense set up by defendants' counsel is that the patents have not been so fully sustained as to make the adjudications in the several cases named conclusive or binding upon this court. I do not understand that complainants insist that these adjudications are absolutely conclusive, but that they are authority of the very highest nature. I understand the rule to be well settled that the judgment of a circuit court in another circuit, while not controlling, is entitled to the highest consideration. Mr. Justice Miller states the rule to be thus: "I think that the uniform course of decisions in the courts of the United States, where a previous decision has been had by a circuit court with reo gard to the valldity of a patent, has been to treat It as of the very highest nature, and as almost conclusive in an application for injunction in another case founded on the same patent."
The complainants have established the validity of their patent by these several adjudications after a protracted litigation extend· ing over several years, and by a very large expenditure of money. To ask this court to go through the labor to pass upon a case involving the same questions of law and fact, and to compel the complainants, in each district where an infringement may take place, to incur such additional expenditure of money, would be a great hardship. I accept the decisions of the several circuit courts named as sufficiently persuasive to authorize me to find the letters patent valid. The next contention is that there is not sufficient proof of title by assignment of the patents to the complainants in this case. The complainants, in their bill, under o;lth, aver that proper and valid assignments of these patents were made. The answer of the defendants under oath is waived. Under these pleadings the answer of the defendants is not evidence in their favor as to the averments therein contained. They might have offered affidavits
lOmlt
J'EDJl:RAIi nEPORTER,
vol. 61.
denying thatHUte title had been transferred by It$signme:n:t, as the Qill, whicb,wouldhave pV,t the compll;linants upon thelr proof as to such assignments. Raving failed in this, the of tIle bill control, and upon this point the court must find'the proof satisfactory. The question of infringement is clearly made out,so far as the New. York.& Ohio Company, its agents, officers, and stockholders are e().ijcern'ed. It is substantially conceded in the answer and affidavits that, so far as the lamp m::t.de by that corporation is concerned, the infringement is established as true. But as to the Paeka'l'd· Electric Company the infringement is denied. In the conclnsionreached by the court, it is not necessary to pass upon tI;te'(l1iestion ?f'infringell1entas to this particular defendant. further charge in their bill that the defendants, the com,plainants in their remedies, conspired toantl, intending to infringe sai4 Edison letters patent under oi'gllIiization, but"for their.individual benefit, caused Packard ElectricC0!llpany, under ,the laws of the state of OhIO,' and that thereafter, III purstianceof conspiracy, "and with a"riew of still further embarrassing your orators," caused to be organized, under the laws of, West Virginia, a corporation known as the New York & Ohio Company, ·with a nomindl capital, and that by combination and colll1'sion' the business of manufacturing and selling incandescent laIIl;ps,JJl of complainants; letters patent, has been Wilham D. Packard, J. Ward Packard, and J. W. Peale,' for' their own personal benefit, and for the benefit of the said ,New York & Ohio Company; and that the said defendants liaveorganized and operated both said corporations, not in good faith, but as an expedient to avoid the legal consequences of their acts mthe infringement of said Edison letters patent, which they weUkPew they were infringing, It seems, from the e"ridence,on behalf, of, the defendants, that the Packard Electric Company, for the more convenient conduct of its 'business, made a lease of a part of its factory to the New York & Ohio Company for the purpose of enabling it to manufacture incandescent electric lamps. This business has been carried on by the .New York & Ohio Company principally through the active efforts of the two Packards before named. Some proof has been offered on behalf of the complainants tending to show that thisJease and business arrangement were a subterfuge and a fraud intended!to'cmbarrass the compltUnants by having· the infringement done. thrOUgh an irresponsible and nonresident corporation. Serious allegations of fraud and collusion are made in the bill, which it iSll0t: neoessary, for the purposes of this case, to determine. The before me, ,will, therefore be considered case, upon the' :removed from all question of fraud or fraudulent intent, so far as the defendant the· Packard Electric Company is concerned. It must rest upon complainants' right to ;an injunction against thOSe of,:the defendants who ,are infringing itll patents while acting as officers, agents; or stockholdenH>f the New York & Ohio
EDISON ELECTRIC LIGHT CO. !1. PACKARD ELECTRIC CO.
1005
Company. elm they be enjoined from infringing in a case in which the corporation for which they act is not made a defendant, and is without the jurisdiction of the court? That corporation was created under the laws of the state of West Virginia, and, in a patent suit, can only be sued in that jurisdiction. Can the complainants reach its officers, agents, and stockholders, and procure an injunction against them in this district, without service upon the corporation? If the complainants now prayed for full relief as against them, and asked for an accounting for profits and damagres against the officers, agents, and stockholders, without service upon the corporation, and that was now the question under consideration, the case would present greater difficulties. Where the corporation is a defendant, and duly served, its officers and stockholders cannot shield themselves from liability for damages behind their corporation. While its liability may be primary, and while, if solvent, it may be first held accountable, it has been held no legal defense for stockholders or officers to insist upon such prior or exclusive liability as a shield and protection for their wrongful acts. Tyler v. Galloway, 13 Fed. 477. But it is insisted that the complainants cannot bring- their suit against the officers of a foreign corporation in this district, and by this sort of indirect proceeding accomplish what they could not do by a proceeding directly against the corporation itself. It is true the corporation cannot be sued here. It does not travel from state to state, through its officers, to confer jurisdiction wherever they may be found and served with process. A suit to establish the validity of a patent, its infringement, and to recover dam ages and profits for such infringement, must, under the recent legislation of congress, be brought in the state where the corporation was created, and in the judicial district where it is located, and of which it is a citizen. But in a suit of this character, where, for the present, the only relief sought is an injunction to restrain the wrongful act of infringement, may not such illegal and tortious act be restrained wherever committed? An infringement is a tort. Root v. Railway Co., 105 U. S. 189. The act done is wrong and illegal in itself, no matter by whom performed. It is wrong to make, to use, or to sell infringing devices without license from the patentee. It is wrong to do either, wherever done, or by whomsoever done. Can a corporation created in one state send its officers, agents, and stockholders into another jurisdiction, to there infringe a patent, and claim immunity from the process of a court of equity restraining such wrong, because its agents doing the illegal act are acting for it as a nonresident corporation exempt from service of process from that court? The law throws around a patentee every protection possible. The patent law contemplated that the inventor should have a monopoly of his patent, and it has undertaken to give him full and speedy relief against all who encroach upon his rights. An infringement of' a patent adjudicated to be valid, and useful to the public, is declared by law to be ille' gal, and I think may be restrained wherever it is committed, and by whomsoever it is done, license.
1006
J'EDERAL REPOR'1'ER,
The courts have gone 80 far as to restrain the officers of a cor· poration who aided in promoting the infringing sale or use by transporting the infringing articles. In the case of Supply .Co. McCready, 17 Blatchf. 291, Fed. Cas. No. 295, Judge Blatchford enjoined the officers of the Old Dominion Steamship Company from transporting from New York to Norfolk, Va., cotton ties which were an infringement of letters patent owned by Brodie & The corporation was a citizen of Delaware, and was not served with process, or made a defendant in the case. Its president and general freight agent wel,'e made defendants, and the restraining order was to prohibit them from accepting or transporting, as freight, any cotton ties infringing patents owned by the complainant. The defendants answered .that they were only officers of a corporation, which was not sued, which was a common carrier, and, as such, transported all freight tendered, and that theyeould not be expected to know what articles of manufacture offered for shipment were infringements of patents, and that, therefore, an injunction of· the character prayed for would be a great hardship. But Judge Blatchford met the objections, and said: I "It is entirely clear that the owners of infringing and unlicensed cotton ties, who are causing them to be transported by vessels of the Old Dominion Steamship Oompany,. are sending them for sale and use, and are employing said company and its officers as agents and servants in promoting such sale and use. It would seem,on principle, that there ought to be no difficulty in restraining by Injunction all persons, 'Whether: officers of the corporation 01' not, who are aiding In the promotionot the infringing sale and use, whether such persona would be ,for profits and dalllages or not. It has been so held by thiS court. G<>odyear v. Phelps, 3 Blatchf. 91, Cas. No. 5,581."
The court extended relief in that case further than we are asked to .do in this case. The defendants in the case cited were merely promoting the sale and use of the infringing articles by transporting them as common carriers. In this case they are active in the infringement itself, and interested, as officers and stockholders of the corporation infringing, in the profits to be realized from the illegal acts., The acts they are performing are, flagrant, and the proximate cause of the injuries inflicted upon the complainants. They are illegal and tortious, and the complainants are entitled .to have the infringement suppressed, without reference to whether tJ;1e infringers are acting for themselves, .or whether ·they are acting in a representative capacity for others, who are nonresidents of this district. When the act to be restrained is lawful, but becomes illegal only when performed by a certain person, the injunction can only restrain that persqn or his agent from doing the forbidden act; but when it is an illegal and tortious act, no matter by whom or where it is done, the perpetrator may be restrained wherever found. are free from all frauduOonceding; therefore, that the lent combinations, and have not thrown around themselves the shield of a nonresident corporation for the purpose of embarrassing the complainants in securing relief against an illegal and deliberate infringement, as alleged in the bill, 1 stm think the complain-
EDISON ELECTRW LIGHT CO. 11. PACKARD ELECTRIC CO.
1007
ants are entitled to relief, at least to the extent of suppressing the infringement, even though it is done by the officers, agents, and stockholders of a corporation not itself made a defendant, and not amenable to the process of this court. There is no injustice or enjoined. They are guilty of a tort wrong done to the in committing this infringement, or in aiding or abetting it. They are jointly and severally liable for the tort. The corporation accepts and the benefit of their wrongful acts. Would it be equitable to say to the complainants: ''You shall not have an injunction to restrain or .suppress this wrong, though it is done in this jurisdiction, and without excuse or justification; but you can have relief by going to West Virginia, and proceed against the corporation itself for a wrong done, and continuing to be done. in Ohio"? Then relief by such a long-dista,nce proceeding would be slow and embarrassing. The law encourages no such subterfuges. Equity abhors defenses which are not based upon merit or right, but suggest evasive and embarrassing remedies for wrongs substantially conceded. A wrong is being committed daily to the complainants in this jurisdiction by at least two defendants, who are infringers, who are served with process, and who are now before thecoul't. This court, in my judgment, has the right and power to restrain that wrong, no matter in what character or representative capacity it is done. The refusal to grant relief would work great and irreparable injury to the complainants. The allowance of the fnjunction will stop the wrongful acts, and the wrongdoers cannot complain because it deals with them as individuals when they are in fact agents and stockholders. The wrong will be restrained, and the complainants left to secure their remedy for damages for the infringements already made by such proceedings as the law provides. I have carefully considered the several authorities cited by the defendants, denying to the court the right to enjoin the defendants the Packards without service upon their corporation, for which they act; but none of them, in my judgment, cover the precise question herein decided. I have based this decision upon such broad principles that, if in error, the defendants can speedily secure relief by appeal. The injunction is refused as to the Packard Electric Company. It d.enies that ·it ever infringed, but claims, if it did, that it was prior to 1891, and disclaims any intention to infringe in the future. This refusal of a writ is made without prejudice to complainants' right to move for an injunction, on short notice, if hereafter said ·defendant should manufacture a lamp which infringes complainants' patents. The injunction is allowed as to James Ward Packard and William D. Packard, who will be enjoined from making, -selling, or using infringing lamps, ,,:hether acting for themselves, personally, or for the New York & OhIO Company, as officers, agents, ·01' stockholders. A decree may be prepared in accordance with this opinion.
1008
J'EDQ.U.. ;aEl'ORTER,
vol. 61. '.
;.1,:
LEVY et at v. WAlTT et at. (Olrcult OoU1't of Appeals, FIrst Olrcult. May 15, 1894.) No. 81. 1)uDE-MARltS-AcQUIS1'l'iOl'f__OCOUPATION OF MARKET.
Oomplainants applied a name, widely known by reason of local geographical uses, to sroatl lots of cigars manufactured and sold by tbem,oneJn1878, on a sJ;lepial order; one In 1884, in competition with a trademar]{ for a limited market; One In 1885; and no more until 1889. Before the sale In 1885,defendants, witbout knowledge of what bad been done by complainants, and in good faith, began the sale of cigars of their own manufacture under tbe same name, and continued extensive sales and advertisements thereof for five years without question. Held, that there was no such appropriation or actual occupation of the market by cotpplainants as to entitle them to'assert a right to a trade-mark, as against defendants.. 56 Fed. 1016, affirmed.
Appeal from the, Oircuit Oourt of. the United States for the District .0t.Massachusetts. Levy an,d others, constituting the firm 'l'his .}Vasa suit by of Ler.r::Bros., against Henry Waitt and others,. constituting. the firm ot "\Vaitt Bond,jo restrain the alleged infringeD;lent of the trade,m,ark ."Blackstone,". as applied to cigars. The bill was dismissed. 56 Fed. 1016. Complainants appealed. Geol.'ge L. Huntress (Morris S. Wise, on the brief), for appellants. Payson E. Tucker and. George O. Abbott, for appellees. Before PUTNAM, Circuit Judge, and :NELSON and WEBB, District Judges, PUT:N'AM, Oircuit.Judge. The Reverend Mr. Blaxton,or Blackston, name which has becm;ne a favodte one for local geographical uses. A well-known street in Boston, on which two of the parties na!lled in the controversy .this case conducted their business; a river,. partly in Massachusetts and partly in Rhode Island (not of the. first order, but so lined with manufactories and villages that it is well known throughout the 'United States); a canal following the line of that river (now almost a tradition, but formerly as well known ,as the river itself); a considerable town in the former state; and many local corporations,-bear the namt;! of "Blackstone!' From the best view of the facts of this case which could be taken for all, A. P. Holley & Son, Waitt & Bond, the defendants below, and Levy Bros., the cOUlplainants below, each without the knowledge of the acts of the others, and contrary to the caution of the courts, usually disapproving of the use of widely-known geographical names as trade-marks, of which the last example of importance is. Mill Co. v. Alcoro, 150 U. S.460, 14 Sup. Ct. 151, adopted for cigars the word "Blackstone,"-,...A.P. Holley & Son, for the local market. lIt and about Woonsocket, in the state of Rhode Island; Waitt & Bond, originally for Boston and. the New England staltes; and Levy Bros., originally for New York and the west. It is not tq.e qourt to decide now whether, under the circumnecessary stances of rthis case, this use of a geograplllcal name for the several limited markets described could be protected by the law, as was