A person in the employ of a smelting company invented a new
method of tapping and withdrawing molten metal from a smelting
furnace. He took out a patent for it, and permitted his employer to
use it without charge so long as he remained in its employ, which
was about ten years. After that, his employer continued to use it,
and when the patent was about to expire, the patentee filed a bill
against the company, praying for injunctions, preliminary and
perpetual, and for an accounting. Before the return of the
subpoena, the patent had expired. On the trial, it appeared that
the invention had been used for more than seventeen years with the
knowledge and assent of the patentee, and without any complaint
Page 158 U. S. 151
on his part except that the company had not paid royalties after
he quitted its employment. The defenses were (1) that the circuit
court had no jurisdiction of the case because no federal question
was involved and there was no diversity of citizenship of the
parties, (2) that even if there was a federal question involved,
the circuit court, as a court of equity, had no jurisdiction of the
case because complainants had a plain, adequate, and complete
remedy at law. The court below sustained both of the defenses and
dismissed the bill.
Held that the decree was fully
justified.
This was a bill in equity filed by appellants against appellee
in the Circuit Court of the United States for the Northern District
of California to recover for the infringement of a patent. The
patent, No. 121,385, bears date November 28, 1871, and was issued
to appellants as joint inventors, the invention consisting of a
method of tapping or withdrawing molten lead or other metals from a
smelting furnace. The bill was filed October 29, 1888, and
contained the usual prayer for an injunction, preliminary and
perpetual, and for an accounting for damages and for profits. The
subpoena was issued on that day, returnable December 3, 1888, but
no notice was given of an application, nor was any application
made, for a preliminary injunction. Appellee answered January 7,
1889, and a replication was filed on the fourth of the following
February. No question was made as to the validity or construction
of the patent, and the patent does not appear in the record.
The defenses were (1) that the circuit court had no jurisdiction
of the case because no federal question was involved and there was
no diversity of citizenship of the parties; (2) that even if there
was a federal question involved, the circuit court, as a court of
equity, had no jurisdiction of the case because complainants had a
plain, adequate, and complete remedy at law. The circuit court,
Sawyer, J., sustained both of the defenses and dismissed the bill,
45 F. 199, whereupon the case was brought to this court on
appeal.
Page 158 U. S. 152
MR. CHIEF JUSTICE FULLER, after stating the facts in the
foregoing language, delivered the opinion of the Court.
As stated by the circuit court, when this patent was applied for
and issued, complainants were both in the employment of the
defendant, one as superintendent of defendant's mine and the other
as assayer and smelter at the mine and smelting works, each
receiving a regular salary. While thus engaged, they made the
invention covered by the patent, and on April 19, 1871, before the
application for the patent, put the improvement on the first
furnace of defendant, and on April 24th, the date of the
application, put it on the second furnace. These improvements were
continuously used in defendant's works from that time on to the
commencement of this suit. Complainant Keyes left defendant's
employment September 1, 1872, and complainant Arents on November
10, 1872. They were both aware of the use of the improvement
thereafter, and down to the time the suit was commenced, and it
does not appear that Keyes had any communication with defendant
upon that subject; but complainant Arents notified defendant's
president in June, 1872, that the company could use the improvement
while he remained in its employment, but that afterwards he would
require the company to pay what others had to pay for its use, and,
subsequently to November 10, 1872, Arents at various times made
demands upon the company's secretary for payment for the use of the
improvement, and in the summer of 1888 made a similar demand upon
the company's president. Defendant did not contest the validity of
the patent nor deny the use of the improvement, but defended on the
ground that no case for equitable jurisdiction was presented upon
the facts, and that, moreover, it clearly appeared that defendant
had an implied license to use the invention without compensation
while complainants continued in its employment, and to use it after
they left for the same royalties charged other parties, and
therefore
Page 158 U. S. 153
that the remedy of complainants was an ordinary action at law
over which, as no diversity of citizenship appeared, the circuit
court had no jurisdiction.
We think from an examination of the evidence that the circuit
court was entirely right in its conclusion that there was at least
an implied license to use the improvement upon the same terms and
royalties fixed for other parties from the time complainants left
defendant's employment, while defendant was entitled to use the
invention without payment of any royalties during the continuance
of such employment, and, apart from that, that the decree cannot be
reversed on the ground that the circuit court erred in dismissing
the bill because when it was filed, complainants were not entitled
to any relief resting on grounds of equity, while their remedy at
law, then and thereafter, was plain, adequate, and complete.
The jurisdiction in equity was predicated upon the right to an
injunction "according to the course and principles of courts of
equity." Rev.Stat. ยง 4921. The subpoena was issued and served
October 29, 1888, returnable on the first Monday in December, which
was December 3, 1888. The patent expired November 28, 1888, between
the day of service of subpoena and the return day, and before
defendant was required to or did file its answer.
No notice of an application for a preliminary injunction was
given, nor any application made therefor, nor was there any showing
on the pleadings or otherwise of irreparable injury to the
complainants by the continued use of the invention for twenty-nine
days after the bill was filed and before the expiration of the
patent. Such a contention, after seventeen years of use by appellee
with appellants' knowledge, would have been absurd, and even if
appellants had applied for a preliminary injunction before the
return day, the court would have been justified in refusing to
award it. Obviously the laches of appellants was such, upon their
own showing (for the delay was unexplained), as to dissentitle them
to a preliminary injunction, as ruled by MR. JUSTICE BREWER when
circuit judge, in
McLaughlin v. People's Railroad, 21 F.
574, and by Judge Blodgett in
American Cable Railway
Page 158 U. S. 154
Co. v. Chicago City Railway Co., 41 F. 522.
See
also Keyes v. Pueblo Smelting Co., 31 F. 560.
This record discloses that the invention had been used for more
than seventeen years with the knowledge and assent of appellants,
and without any complaint on their part, except that appellee had
not paid royalties after complainants quit its employment. This
being so, the case clearly falls within
Root v. Railway
Co., 105 U. S. 189;
Clark v. Wooster, 119 U. S. 322, and
Lane & Bodley Co. v. Locke, 150 U.
S. 193, and the decree was fully justified.
In
Clark v. Wooster, Mr. Justice Bradley, delivering
the opinion of the Court, said:
"As to the first point, the bill does not show any special
ground for equitable relief except the prayer for an injunction. To
this the plaintiff was entitled, even for the short time the patent
had to run, unless the court had deemed it improper to grant it.
If, by the course of the court, no injunction could have been
obtained in that time, the bill could very properly have been
dismissed, and ought to have been. But by the rules of the court in
which the suit was brought, only four days' notice of application
for an injunction was required. Whether one was applied for does
not appear. But the court had jurisdiction of the case, and could
retain the bill if, in its discretion, it saw fit to do so, which
it did. It might have dismissed the bill if it had deemed it
inexpedient to grant an injunction, but that was a matter in its
own sound discretion, and with that discretion it is not our
province to interfere unless it was exercised in a manner clearly
illegal."
In whatever aspect viewed, we perceive no ground for disturbing
the decree.
Decree affirmed.
