Burdell v. Denig - 92 U.S. 716 (1875)
U.S. Supreme Court
Burdell v. Denig, 92 U.S. 716 (1875)
Burdell v. Denig
92 U.S. 716
1. In cases where profits are the proper measure of damages for the infringement of a patent, such profits as the infringer has made or ought to have made govern, and not those which the plaintiff can show that he might have made.
2. The above rule applies peculiarly and mainly to cases in equity, and is based upon the idea that as to such profits, the infringer of the patent should be treated as a trustee for the owner thereof. On the other hand, in actions at law it has been repeatedly held that the rate at which sales of licenses of machines were made, or the established royalty, constitutes the primary and true criterion of damages.
3. In the absence of satisfactory evidence of that class which is more appropriate in the forum where the case is pending, the other class may be resorted to as furnishing one of the elements on which the damages or the compensation may be ascertained.
4. A certain instrument (infra, p. 92 U. S. 717), held not to be a mere power of attorney, revocable at the pleasure of the maker, but a contract under which rights for a specified time were acquired.
5. As a receipt for the use of four of plaintiffs' machines, executed after the institution of the suit, was a valid acquittance of any claim for such use, it was properly admitted in evidence under the general issue to reduce the amount of damages.
6. Where the evidence merely tended to prove certain disputed facts in issue, it
was error for the court to assume in its charge that they had been proved, and thus withdraw from the jury the right to weigh the evidence bearing upon such facts.
The facts are stated in the opinion of the Court. The paper therein referred to as having been introduced by the defendants is as follows:
"Article of agreement made and entered into, this thirteenth day of March, 1860, between Sarah Burdell, of the County of Franklin, in the State of Ohio, and H. Crary, of the same county, witnesseth:"
"That said Sarah Burdell does hereby authorize and empower the said Crary, for the full term of four years and eight months, or from the date hereof until the twelfth day of November, 1864, as fully and completely as she might herself had not this agreement been entered into, to sell and use, and grant to others the right to use, in the said County of Franklin, A. B. Wilson's sewing machines, as known and denominated for sewing cloth and other fabrics, patented Nov. 12, 1850, and reissued Jan. 22 and Dec. 9, 1856, and also, the sewing machine patented by J. M. Singer, together with all the improvements which have been made already, or shall hereafter be made in the same, without additional costs, and also all other sewing machines of every name and description to which the said Sarah may have power to exercise any control whatever, and the said Sarah hereby covenants and agrees with the said Crary that during the said term of four years and eight months, she will not sell or use, or grant to others the right to sell or use, in the said County of Franklin, the sewing machines above specified, or any other of any name or kind or description without the consent of said Crary."
"2. That the said Crary agrees to make out and deliver to the said Sarah Burdell or her authorized agent or attorney on the first day of each and every month a full and accurate report of all sales of sewing machines of every name, kind, and quality made by him or his agents during the preceding month, stating the first cost of each such machine in the purchase of the same from the manufacturers or their agents until ready for shipping, exclusive of freight and other incidental charges; also, the price at which such
machine was sold by said Crary or his agents, and stating also, the difference between the said first cost of the said machines and the price at which the same were sold, and which difference for the preceding month, on the first day of each month when the said report is delivered, as aforesaid, the said Crary agrees to pay the said Sarah Burdell, or her authorized agent or attorney, thirty-five percentum during the first six months from the date hereof, and forty percentum thereafter, or until the 12th of November, 1864, provided however, if the said percentage for any one month during the first four months from the date hereof should not amount to the sum of seventy-five dollars, the said Crary agrees to make it up to the full sum of seventy-five dollars, and the said Sarah agrees that for any such deficiency or difference between the said percentage and the sum of seventy-five dollars the said Crary may reimburse himself out of the first excess of said percentage over one hundred dollars after the expiration of the said four months from the date hereof."
"3. It is agreed by the said Sarah Burdell and the Said Crary that in the prosecution of an injunction to restrain or prevent the sale or use of any sewing machine in said County of Franklin in violation of the right, power, and authority hereby vested in the said Crary to sell or use such machine in said county and in the prosecution of any suit at law for the recovery of damages for the sale hereafter or for the use of any such sewing machine hereafter sold, the costs and expense of any such suit at law or in equity shall be equally borne by the said Sarah and the said Crary, each paying one-half of such costs and expenses, and each sharing equally, that is, each being entitled to one-half of the net amount received in any such proceedings, at law or in equity, provided that no such injunction shall be applied for or any such suit at law instituted without the consent of both parties to this agreement; provided also that for the purpose of prosecuting any such suit at law that may be agreed upon by the parties hereto, the power and authority herein vested in the said Crary shall remain and continue in full force and effect after the expiration of said term of four years and eight months; provided also that in any suits or proceedings at law or in equity which the said Sarah may see fit to institute on account of the use hereafter of any sewing machines hereafter sold, the said Crary shall not be required to defray any portion of the costs and expenses or be entitled to any share of the amount so recovered in any suit or proceedings so instituted as last aforesaid by said Sarah. "
"4. It is agreed that the first report of sales herein provided for shall be made on the first day of May next, and shall include all sales of sewing machines from this date until the said first day of May."
"Witness our hands and seals this thirteenth day of March, 1860."
"SARAH BURDELL [SEAL]"
"H. CRARY [SEAL]"
"In presence of:"