An assignee in bankruptcy is not bound to accept the title to a
patent for an invention, vested in the bankrupt at the time of the
bankruptcy if in his opinion it is worthless, or may prove to be
burdensome and unprofitable; and his neglect for a year, during
which he winds up the estate, to assume the ownership of such
property, and his statement to a person desiring to purchase it
that he has no power to do anything with it and that the bankrupt
is the only one who can give title, are convincing proof of an
election not to accept it.
It does not lie in the mouth of an alleged infringer of a patent
to set up the right of an assignee in bankruptcy to the patent as
against a title acquired from the bankrupt with the consent of the
assignee.
Section 4917 of the Revised Statutes, which provides for
disclaimers
"whenever, through inadvertence, accident, or mistake, and
without any fraudulent or deceptive intention, a patentee has
claimed more than that of which he was the original or first
inventor or discoverer,"
and allows the patentee to
"make disclaimer of such parts of the thing patented as he shall
not choose to claim or hold by virtue of the patent or assignment,
stating therein the extent of his interest in such patent,"
is broad enough to cover disclaimers made to avoid the effect of
having included in a patent more devices than can properly be made
the subject of a single patent.
The power of a patentee to disclaim is a beneficial power, and
ought not to be denied except when resorted to for a fraudulent and
deceptive purpose.
The effect of delay by a patentee to make a disclaimer under
Rev.Stat. § 4917 until after the commencement of an action for the
infringement of his patent goes only to the recovery of costs.
Where the Revised Statutes adopt language of a previous statute
which had been construed by this court, Congress must be considered
as adopting that construction.
The invention patented by letters patent No. 128,925, issued
July 9, 1872, to Charles A. Taylor for an improvement in trunks was
novel and patentable; and the letters patent are infringed by the
fasteners constructed in accordance with the descriptions in
letters patent No. 145,817 dated December 23, 1873, and the
improvements thereon described in letters
Page 145 U. S. 30
patent No. 163,828, dated April 10, 1870, both issued to Anthony
V. Romadka.
The pioneer in an art, who discovers a principle which goes into
almost universal use, is entitled to a liberal construction of his
claim.
When a patented invention is infringed by its use upon another
article of which it forms an inconsiderable part, taking the place
of something previously serving the same uses, and there is no
established royalty by which to measure the damages, they may be
ascertained by finding the difference between the cost of the
patented article and the cost of the article which it displaces;
but this rule may be modified, if law and justice seem to require
it.
When it is doubtful from the evidence whether the word
"patented" could be affixed to a manufactured article or whether a
label should be attached with a notice of the patent, under the
provisions of Rev. Stat. § 4900, the judgment of the patentees is
entitled to weight in determining the question.
A defendant in a suit for the infringement of letters patent,
who relies upon a want of knowledge on his part of the actual
existence of the patent, should aver the same in his answer.
When an assignee in bankruptcy refuses to accept a transfer of a
right of action existing in the bankrupt at the time of the
bankruptcy, and abandons it to the bankrupt before the expiration
of the time within which an assignee in bankruptcy could bring suit
upon it, the right of action of the bankrupt and of a purchaser
from him are governed by the general statute of limitations, and
not by the rule prescribed for an assignee in bankruptcy.
The court stated the case as follows:
This was a bill in equity by the appellant Sessions for the
infringement of letters patent No. 128,925, issued July 9, 1872, to
Charles A. Taylor, for an improvement in trunks.
The patent included several devices used in the manufacture of
trunks: first, a yielding roller to be applied to the outside of
the trunk; second, in spring catches to hold the trunk shut; third,
in a brace of peculiar construction applied to the outside of the
trunk for the purpose of holding up the lid; and fourth, in a
spring arm for supporting the tray when turned up. In the
specification, the patentee made the following statement with
regard to the spring catch, which was the only feature of the
invention claimed to have been infringed in this suit:
"Instead of providing the top of the trunk with the usual
Page 145 U. S. 31
straps for fastening it down, I attach to its front two spring
catches, I, and to the top two tangs or plates, J, which lock into
and are held by the catches. Each catch consists of a metal socket,
e, provided with a hinged latch or hook,
f, and
with a flat spring,
g, which bears against the lower end
of the latch and keeps its upper end pressed inward against the
socket. The upper end of the latch or hook is provided with a
prong,
i, which extends through into the socket as shown
in Fig. 4; the upper side of the prong being beveled off, as shown.
The tangs on the top or lid are provided with beveled ends and with
holes or openings, as shown. When the top is pressed down, the
tangs slide down into the sockets, and the prongs,
i, of
the latches, lock through them in the manner shown in Fig. 4, so as
to hold the top or lid down securely. In order to unlock latches,
it is only necessary to turn back the upper ends of the hooks or
laches so as to draw the prongs out of the tangs. After the latches
are turned back a certain distance. the springs hold them in
position, as shown in Fig. 1, and in dotted lines in Fig. 4, so
that it is only necessary to attend to one of them at a time."
The only claim which was alleged to have been infringed was the
third, which reads as follows:
"3. The spring catches, I, constructed and applied to the front
of the body, as described, in combination with the tongues or
hasps, J, on the top, when arranged to operate as set forth."
The answer denied the validity of the patent and infringement of
the same. After the testimony had been taken, the plaintiff entered
with the Commissioner of Patents a disclaimer of all the claims of
the patent except the one in suit, and upon the hearing upon
pleadings and proofs, the court adjudged the patent to be valid,
and that the defendants had infringed, and referred the case to a
master to ascertain and report to the court the number of trunk
fasteners made, used, and sold by defendants, and the profits which
they had received and which had accrued to them since December 12,
1874, from their infringement, together with all damages in excess
of such profits sustained by plaintiff and his assignor since that
date.
Page 145 U. S. 32
Subsequent to the entry of the interlocutory decree, which was
opened for that purpose, and pending proceedings before the master,
the defendants by leave of the court amended their answer by
alleging that the title to the patent was in the assignee in
bankruptcy of one Poinier, who assigned the patent to the plaintiff
subsequent to his adjudication in bankruptcy. The bill was also
amended by averring that the assignee never accepted title to the
patent, but neglected and refused to assert any claim thereto, and
that he is now estopped from claiming any title or exercising any
dominion over such patent or the invention thereby secured, and is
also barred by the provisions of the Bankruptcy Act requiring suit
to be brought within two years after the accruing of any cause of
action. In his report, made under the order of the court, the
master found that the testimony left no doubt that
"at the date of the granting of the patent to Taylor, the only
known device for accomplishing the results produced by the trunk
fastener was the ordinary trunk strap used in conjunction with the
simple dowel pin. It seems, therefore, that the profits for which
the defendants must account to complainant under the decree of this
case are to be found by arriving at the cost of making and applying
the strap and dowels and deducting therefrom the cost of making and
applying the infringing trunk fastener manufactured and sold by the
defendants."
Figuring upon this basis, the master found that the sum of
$11,455.03 had been saved by the defendants by the manufacture and
use of 2,500 gross of fasteners admitted to have been made and used
by them, over what it would have cost them to have made and applied
the straps and dowels necessary and proper to have been used for
the same purpose in lieu of such infringing fasteners. No
computation was made of damages, for the reason that the testimony
showed that the profits allowed by him largely exceeded any actual
damage sustained by the plaintiff. Exceptions were filed by both
parties to this report, and a final decree was entered, sustaining
the exceptions filed by the defendants to the master's report,
vacating and setting aside such report, and decreeing nominal
damages
Page 145 U. S. 33
for the infringement. 21 F. 124. Both parties appealed from this
decree to this Court.
Page 145 U. S. 37
MR. JUSTICE BROWN, after stating the facts in the foregoing
language, delivered the opinion of the Court.
1. Defendants attack the title of the plaintiff to this patent
upon the ground that Poinier, who bought the patent of Taylor in
1872, and subsequently, in 1878, sold it to Sessions, had prior to
such sale, and in September, 1876, been duly adjudicated a bankrupt
in the District Court of the United States for the District of New
Jersey, and an assignee appointed, in whom, it is claimed, the
legal title to the patent
Page 145 U. S. 38
vested. It seems, however, that Poinier did not include this
patent in his schedule of assets, upon the ground, as he said, of
its being unproductive property and of no value. Indeed, all that
he seems to have done with the patent was to make a lot of trunk
fasteners in 1872, which proved to be failures, and which appear to
have been the cause of his insolvency. He made no others for the
three years before he went into bankruptcy. On May 15, 1877, he
received his discharge, and on November 27th of the same year his
assignee was discharged. On June 12, 1878, thirteen months after
Poinier had received his discharge, and six months after his
assignee had been discharged, Sessions bought a shop right of
Poinier, for which he paid him $500, and in the same year purchased
the patent itself, for which he paid him $1,000 additional. Mr.
Shepard, who acted as the agent of the plaintiff in making this
purchase, testifies that he went to Newark on the morning of June
6, 1878, and inquired for Henry W. Poinier.
"I was informed that one Mr. Miller was his assignee, and that I
could learn of his affairs by seeing him. I then went to the office
of Mr. Miller, and found him there, introduced myself, and told him
that I had come to see him about a patent for a trunk fastener
which was owned by Henry W. Poinier, and under which said Poinier
had been making trunk fasteners, and I asked Mr. Miller if he would
sell me said patent, or give me a shop right thereunder, as the
assignee of Mr. Poinier. Mr. Miller replied that he could not do
so; that the estate was all settled up; he had made his return to
the court, and had been discharged as assignee, and he had no power
to do anything in the matter. I asked him what I could do, and he
said the only thing was to go to Mr. Poinier; that Poinier was the
only one who could give me any title. . . . I learned that Mr.
Poinier was in Rochester."
While the assignee does not recollect the conversation, there is
nothing to disprove Mr. Sessions' version of it, nor is it strange
that Miller did not recollect it, as he acted as assignee in some
six or seven hundred cases, and could hardly be expected to
remember all the transactions connected with them. It is undisputed
that Shepard went to Newark to find Poinier, and subsequently went
to
Page 145 U. S. 39
Rochester and found him there. The first assignment from Poinier
was executed August 16, 1878, and conveyed only the title to the
patent itself, but a second assignment, bearing date September 24,
included also all rights of action for infringement from the date
that Poinier himself acquired the title to it.
While, under the provisions of the bankrupt law, the title to
this patent undoubtedly passed to the assignee in bankruptcy of
Poinier, it passed subject to an election on his part not to accept
it if in his opinion it was worthless or would prove to be
burdensome and unprofitable, and he was entitled to a reasonable
time to elect whether he would accept it or not.
American File
Co. v. Garrett, 110 U. S. 288,
110 U. S. 295;
Sparhawk v. Yerkes, 142 U. S. 1;
Amory v. Lawrence, 3 Cliff. 523, 535.
In this case, the assignee had taken a year to wind up the
estate, and had given no sign of his wish to assume this property,
if indeed he knew of its existence. On being asked with reference
to it by the proposed purchaser, he replied that the estate was all
settled up, that he had no power to do anything in the matter, and
that Poinier was the only one who could give a title. A plainer
election not to accept can hardly be imagined. Granting that up to
that time he had known nothing about the patent, it was his duty to
inquire into the matter if he had any thought of accepting it, and
not to mislead the plaintiff's agent by referring him to the
bankrupt as the proper person to apply to. Under the circumstances,
plaintiff could do nothing but purchase of Poinier. Bearing in mind
that no claim to this property is now made by the assignee, but
that his alleged title to it is set up by a third person, who
confessedly has no interest in it himself, it is entirely clear
that the defendants ought not to prevail as against a purchaser who
bought it of the bankrupt after the assignee had disclaimed any
interest in it.
Had the existence of this patent been concealed by the bankrupt,
or the assignee had discovered it subsequently, after his
discharge, and desired to take possession of it for the benefit of
the estate, it is possible the bankruptcy court
Page 145 U. S. 40
might reopen the case, and vacate the discharge for that
purpose.
Clark v.
Clark, 17 How. 315. But it does not lie in the
mouth of an alleged infringer to set up the right of the assignee
as against a title from the bankrupt acquired with the consent of
such assignee. It is quite evident from the facts stated that this
patent, which seems to have been the cause of Poinier's insolvency,
was thought to be of little or no value, that the assignee so
regarded it, and that its real value was only discovered when the
plaintiff had brought to bear upon the manufacture of the device
his own skill and enterprise.
2. Defendants are charged with infringing the third claim of the
Taylor patent, which was for a spring fastener, modifications of
which are now in almost universal use, as a substitute for the
old-fashioned strap and buckle. Upon the hearing in the court
below, it was claimed the patent was invalid by reason of the
joinder of distinct inventions in the same patent, inventions
which, though applicable to the same article,
viz., a
trunk, do not cooperate in the use of such article. The court below
was evidently inclined to this opinion, but permitted the plaintiff
to enter a disclaimer of all the claims but the one in suit.
Whether these different devices were properly embodied in the same
patent or not, we think this was a proper case for a disclaimer
under section 4917. While the language of this section provides for
disclaimers
"whenever, through inadvertence, accident, or mistake, and
without any fraudulent or deceptive intention, a patentee has
claimed more than that of which he was the original or first
inventor or discoverer,"
it allows the patentee to
"make disclaimer of such parts of the thing patented as he shall
not choose to claim or hold by virtue of the patent or assignment,
stating therein the extent of his interest in such patent."
We think this section broad enough to cover disclaimers made to
avoid the effect of having included in the patent more devices than
could properly be made the subject of a single patent. The power to
disclaim is a beneficial one, and ought not to be denied except
where it is resorted to for a fraudulent and deceptive purpose. In
Tuck v. Bramhill, 6 Blatchford 95, a disclaimer was
allowed by
Page 145 U. S. 41
MR. JUSTICE BLATCHFORD where two or more inventions were covered
by a single claim. In
Hailes v. Albany Stove Co.,
123 U. S. 582,
123 U. S. 587,
it was said by Mr. Justice Bradley to be
"usually and properly employed for the surrender of a separate
claim in a patent, or some other distinct and separable matter,
which can be exscinded without mutilating or changing what is left
standing."
The only difficulty connected with the question of the
disclaimer in this case arises from the final sentence of section
4917, that
"no such disclaimer shall affect any action pending at the time
of its being filed, except so far as may relate to the question of
unreasonable neglect or delay in filing it."
There is an unfortunate choice of language here which has
rendered this sentence very ambiguous and difficult of
construction. It was held by Mr. Justice Story in
Reed v.
Cutter, 1 Story, 590, 600, that if the disclaimer were filed
during the pendency of the suit, the plaintiff would not be
entitled to the benefit thereof in that suit, a ruling which had
also been made in
Wyeth v. Stone, 1 Story 273, 294. It was
held in
Tuck v. Bramhill, 6 Blatchford 95, that the
provision meant that a suit pending when a disclaimer is filed is
not to be affected by such filing, so as to prevent the plaintiff
from recovering in it unless it appears that the plaintiff
unreasonably neglected or delayed to file the disclaimer. And such
was also the ruling of Mr. Justice Nelson in
Guyon v.
Serrell, 1 Blatchford 244, and in
Hall v. Wiles, 2
Blatchford 194, 198. We think that section 4917 ought to be read in
connection with section 4922, providing that the patentee may
maintain a suit at law or in equity for the infringement of any
part of the thing patented, notwithstanding the specifications may
embrace more than that of which the patentee was the first inventor
or discoverer; but, in every such case in which a judgment or
decree shall be rendered for the plaintiff, no costs shall be
recovered unless the proper disclaimer has been entered at the
Patent Office before the commencement of the suit. This was
practically the construction given to corresponding sections of the
act of 1837 by this Court in
Smith v.
Nichols, 21 Wall. 112, and of the Revised Statutes
in
Dunbar
Page 145 U. S. 42
v. Meyers, 94 U. S. 187,
94 U. S. 193.
Under section 4922, the effect of delaying a disclaimer until after
the commencement of the suit goes only to the recovery of costs. We
adhere to that construction. Congress, having in the Revised
Statutes adopted the language used in the act of 1837, must be
considered to have adopted also the construction given by this
Court to this sentence, and made it a part of the enactment.
3. The essential feature of the Taylor patent consists of a
plate attached to the body of the trunk, which contains a socket
and hinged catch, and a double acting spring whose function is to
hold the catch either open or shut, and a tang fastened to the lid,
which, as the lid is closed, drops into the socket hole in the
catch, which, when closed, holds the lid firmly in place. It also
acts as a dowel to keep the cover from racking.
Of the alleged anticipating devices the patent to Gaylord of
1861 is a trunk lock, not, as in this case, a fastener, designed to
supplement the lock, and differing from the old-fashioned and well
known trunk lock principally in discarding the hinged hasp, and
using a rigid tang attached to the cover, which sinks into the
socket in the body of the trunk, prepared to receive it, and is
there self-locked, but is unlocked only with an ordinary key. It
was not designed at all to supersede the buckle and strap, but was
only a substitute for, and an improvement upon, the ordinary lock.
In short, it is a modification of the spring lock previously used
upon trunks.
The Roulstone patent of 1866 is for an improvement in traveling
bags, and shows a spring-locking device for securing the two parts
of the bag firmly together. It has no features in common with the
trunk fastener of Taylor, and is not adapted to hold the lid of a
trunk firmly to the body. It has no means for holding the catch out
of engagement when desired, and is wholly unlike the modern trunk
fastener.
The patent to Semple of 1868 covers an angle plate upon the
trunk cover, provided at the end side with a dowel in combination
with a small plate upon the box, provided with a loop into which
the dowel enters, and at the front side with a hasp and staple to
be used with a padlock. The object was to
Page 145 U. S. 43
fasten and hold together the box and the cover of the trunk, but
the means provided for accomplishing this are so different from
those employed by Taylor that they can hardly be compared. Besides,
the device is evidently of no utility.
The patent to Cutter of 1868 was also for an improvement in
trunk locks, especially adapted for security against an
unauthorized opening of the trunk, and operated only by an
independent and detachable key. It appears to be self-locking, and
does not differ materially from the ordinary spring lock. It is not
a trunk fastener, as distinguished from a lock, and is not designed
to be used as a substitute for the strap and buckle.
The patent to Locke of 1871 consists of straps made of hoop
iron, steel, or brass, or other metals which yield readily, their
upper ends resting loosely in caps or escutcheons, so as to have a
slight degree of lateral play, the lower ends being formed
dovetailed, and adapted to engage with catches attached to the body
of the trunk. The lower ends of the straps ride over the lugs of
the catches until the cover is fully closed, when the inclines of
the straps and the lugs coincide, and the straps then drop into
place and remain locked. This device is undoubtedly a fastener, as
distinguished from a lock; but it lacks the rigid tang, the hinged
catch, the spring -- in short, all the essential features of the
Taylor invention.
The Hillebrand patent is also for a trunk lock, and, like the
others, is operated by an independent key, and also lacks the
features of the Taylor patent.
The Ransom patent is for a trunk fastener consisting of two
parts, one of which is attached to the body of the trunk and the
other to the lid. It does not, however, contain the socket open at
the top, and designed to receive a rigid tang, nor does it contain
the other mechanism of the Taylor patent. While intended to
accomplish the same purpose, the means used are so different that
it is far from being an anticipation.
There are none of these patents which contain the peculiar
combination of the Taylor device; none which, had Taylor known of
them, would have suggested his own invention. While his device is
somewhat crude as compared with the improved
Page 145 U. S. 44
styles of trunk fasteners now in use, it contains the underlying
principle of all of them. In short, we find no difficulty in
holding that there is patentable novelty in the Taylor fastener,
and that it is not anticipated by any of the devices put in
evidence. If there were any doubt of this, in view of the fact that
Taylor seems to have been the first to invent a practical trunk
fastener to take the place of the old-fashioned strap and buckle,
and that, improved upon, as it undoubtedly has been, it has
completely taken the place of the earlier devices, we should be
inclined to resolve this doubt in favor of the patentee.
4. The question of infringement is not so easy, as the Romadka
patent, under which the defendants manufacture, approximates more
closely to the ordinary form of the spring lock than does the
Taylor patent. The difference between the two patents, however, is
more in their outward appearance than in their substantial
features. Both resemble the spring lock in having a rigid tang with
a notch in it to receive a catch actuated by a spring, and in being
self-locking, if the catch be closed when the tang enters the
socket. Both differ from it in the fact that the device may be
unlocked without the aid of a key by a simple motion of the finger,
and hence is not designed to protect against unauthorized opening.
The essential features of each are the same. Both have a rigid tang
attached to the cover of the trunk -- in the Taylor patent, with a
hole in it, and in the Romadka patent, with a notch to receive the
catch. Both have a socket attached to the body of the trunk,
containing a hinged catch actuated by a spring which fits into the
hole or notch in the tang. In the Taylor patent, the catch is held
open and shut by a flat spring, and operates at right angles to the
plane of the trunk. In the Romadka device, the catch is held by a
wire spring, and is moved sideways or parallel with the plane of
the trunk by a slight projection at the side of the socket. Both
are identical in principle,
Page 145 U. S. 45
operation, and design, though the trunk fasteners now in
ordinary use resemble the Taylor more than the Romadka patent. In
view of the fact that Taylor was a pioneer in the art of making a
practical metallic trunk fastener, and invented a principle which
has gone into almost universal use in this country, we think he is
entitled to a liberal construction of his claim, and that the
Romadka device, containing, as it does, all the elements of his
combination, should be held an infringement, though there are
superficial dissimilarities in their construction.
5. It only remains to consider the question of damages. Before
the invention of these fasteners, straps and buckles were
universally used to hold the lid of the trunk fast to the body, in
aid of the lock, and dowels appear to have been in common use to
prevent a lateral movement of the lid. Trunks with straps to
support the lock were considered imperfect and unserviceable, and
the dowels had become a recognized necessity except where strength
and durability were of no consequence. In this connection, the
master allowed the difference between the cost of trunk fasteners
and the straps, buckles, and dowels previously in use for the same
purpose, and the court overruled the measure of damages thus
adopted, and entered a decree for nominal damages only.
It seems the defendants did not manufacture these fasteners for
sale, but did manufacture them for use on the trunks made and sold
by them. Obviously their profits upon the entire trunk would not be
a proper measure of damages, since the fasteners were only an
inconsiderable part of the trunk, and profits upon the entire
article are only allowable where such article is wholly the
invention of the patentee, or where its entire value is properly
and legally attributable to the patented feature.
Seymour v.
McCormick, 16 How. 480;
Mowry v.
Whitney, 14 Wall. 620;
Littlefield v.
Perry, 21 Wall. 205;
Garretson v. Clark,
111 U. S. 120.
This Court has, however, repeatedly held that in estimating damages
in the absence of a royalty, it is proper to consider the savings
of the defendant in the use of the patented device over what was
known and in general use for the same purpose anterior to the date
of the
Page 145 U. S. 46
patent. Thus, in
Mowry v.
Whitney, 14 Wall. 620,
81 U. S. 649,
it was said by Mr. Justice Strong that "it is the additional
advantage the defendant derived from the process -- advantage
beyond what he had without it -- for which he must account." In
that case, the master reported the difference between the cost of
certain car wheels and the price for which they were sold as the
profits realized by the defendant, thus charging him the profit
obtained from the entire wheel, instead of that resulting from the
use of the patentee's invention in a part of the manufacture. It
was held not to be a legitimate construction of the findings that
the benefit which the defendant derived from the use of the
complainant's invention was equal to the aggregate of profits he
obtained from the manufacture and sale of the wheels as entireties,
after they had been completed, but that the question to be
determined was what advantage did the defendant derive from using
the complainant's invention over what he had in using other
processes then open to the public, and adequate to enable him to
obtain an equally beneficial result? The same principle was applied
in the case of the
Cawood Patent, 94 U. S.
695,
94 U. S. 710,
in which the defendant made use of an infringing swage block for
the purpose of reforming the ends of railroad rails which had
become exfoliated by wear, and it was held that the gain in mending
these rails by the use of the plaintiff's device, compared with the
cost of mending on the common anvil, and the saving in fuel and
labor, were the proper measure of damages.
"They had the choice of repairing them on the common anvil or on
the complainant's machine. By selecting the latter, they saved a
large part of what they must have expended in the use of the
former. To that extent, they had a positive advantage growing out
of their invasion of complainant's patent."
The subject is also fully considered in the case of
Tilghman
v. Proctor, 125 U. S. 136, in
which it was held that the plaintiff may, instead of damages,
recover the amount of gains and profits the defendants have made by
the use of his invention over what they would have had in using
other means then open to the public and adequate to enable them to
obtain an equally beneficial result. The patent in this case was
for a
Page 145 U. S. 47
process of manufacturing fat acids and glycerine from fatty
bodies by the action of water at a high temperature and pressure.
In his report of damages, the master found that the complainant
derived no profit from the invention otherwise than by granting
licenses to others to use the same, but that the defendant had
derived large profits and savings by the use of the plaintiff's
patented process, which plaintiff sought to recover in the suit. It
was held by this Court that when a bill in equity is filed by the
owner against the infringers of a patent, the plaintiff is entitled
to recover the amount of gains and profits the defendant has made
by the use of his invention, not those he might reasonably have
made, but those which he did make; or, in other words, the fruits
of the advantage which he derived from the use of that invention,
over what he would have had in using other means then open to the
public and adequate to enable him to obtain an equally beneficial
result.
An analogous rule was applied in
Williams v. v. Railroad
Company, 18 Blatchford 181, 185, wherein the patent was for an
improvement in locomotive lamps, which enabled the burning of
kerosene instead of lard oil in locomotive headlights. The
defendant used a number of the patented lamps on its locomotives,
and it was held that its profits were the difference between the
cost of the kerosene which it burned and the lard oil which it
would have had to burn in lieu thereof but for the use of the
plaintiff's lamps. "The statute," said MR. JUSTICE BLATCHFORD
(Rev.Stat. § 4921),
"expressly gives to the plaintiff, on a recovery in a suit in
equity for an infringement, 'the profits' to be accounted for by
the defendant. . . . The defendant made its election when it
infringed and subjected itself to a suit in equity, and the
plaintiff is entitled to the result of the choice he made of suing
in equity and not at law. The plaintiff made his inventions for the
purpose of enabling anyone using them to successfully burn kerosene
oil in lamps for locomotive headlights, and to obtain the full
advantage of its great light-producing capacity. The defendant used
them for that purpose and with that result, and must pay the
profits or savings made thereby. "
Page 145 U. S. 48
We see no reason why this measure of damages should not be
applied to this case. The only argument to the contrary is that the
instances in which this Court has applied this rule are confined to
those wherein the defendant has made use of the complainant's
invention in the operation and conduct of his business, and that it
ought not to be extended to cases in which the defendant
manufactures and sells the devices. Without questioning at this
time the soundness of this contention, we think this case falls
within the former, rather than within the latter category. The
defendants do not manufacture and sell trunk fasteners as such, but
they do make and use them in the business of manufacturing trunks,
and the difference between such use of them and the use of the
old-fashioned strap and buckle represents their profits. If the
defendants manufactured and sold trunk fasteners to be attached to
trunks by their vendees, it might be justly claimed that they did
not use them; but if they manufacture them solely to be attached to
trunks made and sold by themselves, it is nonetheless a use of them
than if they had used the trunk to which they were attached for
their own purposes. If, to put an analogous case, a person made a
business of manufacturing and selling steam engines to which he
attached a patented lubricator, it could hardly be claimed that he
was a manufacturer and seller of lubricators; but he would clearly
be liable as a user of them.
In such case, it makes no difference whether their general
business has been conducted at a profit or loss, or whether they
have derived an additional profit from the sale of trunks equipped
with this device over those not so equipped, although the
presumption would be, from the saving made by them in the use of
this device, that an additional profit upon the sale of the trunks
was made unless it were shown that the use of this device in some
way resulted in a diminution of profits upon the entire
manufacture. As was said in the
Cawood Patent,
94 U. S. 695,
94 U. S.
710:
"If their general business was unprofitable, it was the less so
in consequence of their use of the plaintiff's property. They
gained, therefore, to the extent that they saved themselves from
loss. In settling an account
Page 145 U. S. 49
between a patentee and an infringer of the patent, the question
is not what profits the latter has made in his business or from his
manner of conducting it, but what advantage has he derived from his
use of the patented invention?"
See also Tilghman v. Proctor, 125 U.
S. 136.
The master apparently computed the profits received by the
defendants from the infringement upon the basis of the
interlocutory decree referring the case to him to ascertain and
report the number of fasteners made and used by the defendants, and
the gains, profits, and advantages they received from the
infringement, etc., and as, in the view we have taken of this case,
there was nothing inequitable in this measure of damages, we see no
reason for disturbing the report of the master in that
particular.
6. Further objection is made to a recovery of profits in this
case upon the ground of a noncompliance with the requirements of
Rev.Stat. sec. 4900, in failing "to give sufficient notice to the
public that the same" (that is, the article)
"is patented, either by affixing thereon the word 'Patented,'
together with the day and year the patent was granted, or when,
from the character of the article, this cannot be done, by fixing
to it, or to the package wherein one or more of them is enclosed, a
label containing the like notice, and in any suit for infringement,
by the party failing so to mark, no damages shall be recovered by
the plaintiff except on proof that the defendant was duly notified
of the infringement, and continued, after such notice, to make,
use, or vend the article so patented."
The averment of the bill in this connection is
"that great numbers of trunk catches containing and embodying
the said invention . . . have been manufactured by your orator and
the previous owners of said letters patent, which said catches were
marked with the word 'patent,' and with the year and day of the
month of the date of said letters patent; that the public generally
have acknowledged the validity of said letters patent, and have
generally acquiesced in the right aforesaid of your orator."
It appears that the plaintiff did stamp upon the larger sizes
the fact and the date of the patent, but that he failed to affix
such stamp to the
Page 145 U. S. 50
smaller sizes, on account of the difficulty of marking them in
such way that the mark would be legible when the catches were
japanned or tinned. It is not altogether clear that the stamp could
not have been made upon the smaller sizes; but, in a doubtful case,
something must be left to the judgment of the patentee, who appears
in this case to have complied with the alternative provision of the
act in affixing a label to the packages in which the fasteners were
shipped and sold. He testified in this connection that, with the
two small sizes, it was impracticable to cast the stamp upon the
castings, but that he always marked the packages "Patented." The
fact that this device was patented could hardly have escaped the
notice of Romadka, since the earliest fasteners made under the
patent, which were manufactured and sold by Poinier, were duly
stamped, and Romadka had dealt with him, bought bags of him, and
said to Sessions that he could have bought the patent for a low
price. Although there is an averment in the answer that the
defendants have no knowledge or information save from said bill of
complaint whether the catches were marked with the word "Patented,"
etc., and therefore deny the same, there is no denial of their
knowledge that the Taylor device was patented, and in view of the
fact that all letters patent are recorded, with their
specifications, in the Patent Office, a record which is notice to
all the world, it is not an unreasonable requirement that the
defendant, who relies upon a want of knowledge upon his part of the
actual existence of the patent, should aver the same in his answer,
that the plaintiff may be duly advised of the defense.
Rubber Co. v.
Goodyear, 9 Wall. 788,
76 U. S. 801;
Allen v. Deacon, 21 F. 122.
7. A further point is made that the plaintiff is not entitled to
recover for any profits accrued prior to September 12, 1876, when
Poinier was adjudicated a bankrupt; that any right of action which
he then possessed passed to his assignee, and, so long as it
remained in his hands, became subject to the statutory limitation
of two years, within which, by Rev.Stat. sec. 5057, the assignee is
bound to institute suit. It is insisted that if he abandoned the
claims against third parties for infringement,
Page 145 U. S. 51
he abandoned them subject to the limitation of two years within
which he was himself obliged to bring suit, and that Poinier
himself, and the plaintiff, his assignee, took them subject to that
limitation. In this connection, the defendant relies upon the case
of
Kenyon v. Wrisley, 147 Mass. 476. In this case, the
assignee abandoned to the bankrupt the right to sue upon a
promissory note which he considered worthless, and the plaintiff
brought suit upon the same nine years after the adjudication and
assignment. It was held that the plaintiff had no right to recover,
but the decision was placed upon the express ground that the
assignee did not elect to abandon the claim, and did not consent to
a suit upon it by the plaintiff until after his right of action was
barred by the statute, and it was held that, as the right of suit
upon the note was barred while in the hands of the assignee, it was
not revived by the election of the assignee to abandon it to the
plaintiff. In
Gifford v. Helms, 98 U. S.
248, and in
Wisner v. Brown, 122 U.
S. 214, it was held by this Court that purchasers of
property from an assignee in bankruptcy could not maintain a suit
in equity against third persons claiming adverse interests in such
property if at the time of the purchase from the assignee, his
right of action was, under the Bankruptcy Act, barred by the lapse
of time.
In
Greene v. Taylor, 132 U. S. 415,
132 U. S. 443,
the Court went a step further and held that if at the time of the
purchase from the assignee, the statute had begun to run against
the claim or right in the hands of such assignee, the purchaser
took the right subject to the statutory limitation, and to the
consequence that when sufficient additional time should have run
against it in the hands of the purchaser to make up the entire two
years the claim or right would be wholly barred.
"No initiation of a new period of limitation under any statute
begins to run in favor of the purchaser at the time of his
purchase, whether the two years wholly elapsed or only a part
thereof elapsed, while the claim was owned by the assignee."
We are of opinion, however, that this rule does not apply where
the assignee, before the expiration of the statutory time, elects
to abandon the property to the bankrupt. In such case, the
abandonment
Page 145 U. S. 52
relates back to the commencement of the proceedings in
bankruptcy, and the title stands as if no assignment had been made.
Such abandonment is not so much a transfer of an existing interest
in the assignee as an election on his part to treat the assignment
as having never included that claim. We do not find it necessary to
express an opinion whether the same rule would apply if, as held in
Kenyon v. Wrisley, the statutory limitation were a bar to
an action by the assignee when the abandonment was made.
In the case under consideration, Poinier was adjudicated a
bankrupt September 12, 1876, the assignee was appointed October 17,
1876, and the abandonment took place, according to the testimony of
Mr. Shepard, early in June, 1878, less than two years from the time
the cause of action accrued to the assignee. As Poinier recovered
the right to sue infringers by abandonment from the assignee before
that right had become barred by the statute in his hands, we think
he should be considered as receiving it unaffected by the statute,
and that he and the plaintiff, his assignee, were entitled to bring
this suit as if the assignment had not been made.
May 16, 1892, judgment was entered t hat the decree of the court
below be
Reversed, and the case remanded with directions for further
proceedings in conformity with the opinion of this Court, with
authority, however, to the circuit court, if in its opinion law and
justice shall so require, to modify the total amount of damages as
found by the master.