1. The circuit court of appeals may decline to reexamine the
evidence on appeal when not condensed and stated as required by
Equity Rule 75b. P.
276 U. S.
308.
2. But where the evidence was stated and approved in accordance
with a practice theretofore prevailing in the circuit with the
implied sanction of the circuit court of appeals, and where one of
the judges of that court had made an order declaring that the
transcript was received as a sufficient compliance with the equity
rules, it was error to proceed to a determination of the case
without considering the evidence before affording the appellants an
opportunity to comply with Rule 75b by remitting the transcript to
the district court for further proceedings in conformity therewith.
Barber Asphalt Co. v. Standard Co., 275 U.
S. 372. P.
276 U. S.
308.
3. Such opportunity was not given by an order allowing the
appellants to withdraw the transcript for 30 days; they were
entitled to a specific order operating as a direction to the
district court. P.
276 U. S.
309.
Page 276 U. S. 306
4. Both parties being at fault through having brought the
evidence into the transcript in objectionable form by their express
stipulation, and the objection to it having been made by the court
of its own motion, each party is left to pay its own costs in that
court and this, and counsel fees and expense are not inflicted on
the appellants as in
Barber Asphalt Co. v. Standard Co.,
supra. P.
276 U. S.
310.
18 F.2d 716 reversed.
Certiorari, 274 U.S. 735, to a decree of the circuit court of
appeals affirming, with modifications, a decree for profits in a
patent infringement suit. The court of appeals declined to
reexamine the evidence upon the ground that Equity Rule 79b had not
been complied with. This Court directed the parties to show cause
why the case should not be disposed of in accordance with
Barber Asphalt Co. v. Standard Asphalt Co., 275 U.
S. 372.
MR. JUSTICE VAN DEVANTER delivered the opinion of the Court.
This is a suit for an injunction against the infringement of
letters patent and for an accounting. On the first hearing, the
suit was dismissed for want of equity, but, on appeal, that decree
was reversed. 249 F. 234. Further proceedings resulted in an
accounting before a master, who returned the evidence taken by him
and reported his findings. Both parties excepted; but the findings
were approved and the plaintiffs were given a decree for the
profits found by the master with interest from the close of the
infringing period and an allowance for fees paid to expert
accountants. The defendants appealed, their principal complaint
being that the findings and the decree were not in accord with the
evidence. The circuit
Page 276 U. S. 307
court of appeals declined to examine that complaint because the
appellants had not complied with the provision in equity rule 75b,
relating to the condensation and narration of the evidence. The
minor complaints were examined, and the decree was approved as to
the profits and interest and was disapproved as to the allowance
for payments made to expert accountants. 18 F.2d 716.
A writ of certiorari was granted by this Court to enable it to
review the ruling respecting the nonobservance of the equity rule.
A like writ already had been granted in
Barber Asphalt Paving
Co. v. Standard Asphalt & Rubber Co., 274 U.S. 728, where
the same circuit court of appeals had made a similar ruling. Our
decision in that case was announced recently,
275 U.
S. 372, and we then directed the parties in this case to
show cause why it should not be disposed of in accordance with that
decision. Both parties responded in printed briefs which have been
considered.
The pertinent part of equity rule 75b declares:
"The evidence to be included in the record shall not be set
forth in full, but shall be stated in simple and condensed form,
all parts not essential to the decision of the questions presented
by the appeal being omitted and the testimony of witnesses being
stated only in narrative form, save that, if either party desires
it, and the court or judge so directs, any part of the testimony
shall be reproduced in the exact words of the witness. The duty of
so condensing and stating the evidence shall rest primarily on the
appellant. . . ."
The rule is set forth in full in the opinion in
Barber
Asphalt Paving Co. v. Standard Asphalt & Rubber Co., and
explanation is there made of the reasons for the rule and of the
right practice under it.
In that case, the appellant had stated the evidence without
appreciable condensation or narration, and the statement had been
approved by the district court. We agreed
Page 276 U. S. 308
with the circuit court of appeals that the statement did not
conform to the rule or to its excepting clause, and that the
appellant was not entitled to a reexamination of the evidence thus
wrongly brought into the record. But we held that the situation was
one in which that court, upon proper terms, should have remitted
the transcript to the district court for the purpose of affording
the appellant a further opportunity to conform to the rule. Our
reasons for so holding were that, in the Seventh Circuit, the
judges, both circuit and district, commonly had permitted the
evidence to be stated without condensation or narration; that the
circuit court of appeals had impliedly sanctioned that practice up
to the time of its decision in that case, and that to condemn and
reject a statement of evidence prepared and approved according to
that practice, without according the appellant a further
opportunity to conform to the rule, would be so harsh and unseemly
as to be an abuse of discretion.
In this case, a part of the testimony was stated in condensed
and narrative form; but, in the main, the requirement respecting
condensation and narration was wholly neglected. Much that was
redundant or to no purpose was included, and document after
document was set forth in full, where, at most, there was need for
only a part. Plainly what was done was not in conformity with the
rule or with its excepting clause. Thus, the circuit court of
appeals was justified in declining to reexamine the evidence in the
form in which it was stated.
But, in our opinion, that court, instead of proceeding to
determine the case without considering the evidence, should have
accorded the appellants a further opportunity to have the evidence
rightly brought into the record, and to that end should have
remitted the transcript to the district court for further
proceedings in conformity with the equity rule. The circumstances
surrounding the non-observance
Page 276 U. S. 309
of the rule were substantially identical with those in
Barber Asphalt Paving Co. v. Standard Asphalt & Rubber
Co. In both, the evidence was stated and the statement was
approved in accordance with the then prevailing practice in that
circuit, to which the circuit court of appeals impliedly was giving
its sanction. That practice continued up to the time of that
court's decision in
Barber Asphalt Paving Co. v. Standard
Asphalt & Rubber Co., which preceded its decision in this
case only a few days. There was in this case the additional
circumstance that, when the transcript was filed in the circuit
court of appeals, it was brought to the attention of one of the
judges of that court, and he then made an order declaring that it
was "received as a sufficient compliance with the equity rules." In
the other case, we directed that a further opportunity be given for
complying with the rule, and we think the reasons assigned for that
ruling are equally applicable here.
The appellees suggest that the appellants were accorded such an
opportunity after the circuit court of appeals gave its decision,
and that the opportunity was waived. The court did make an order
granting a rehearing and giving the appellants leave "to withdraw
the transcript" for a period of 30 days. The purpose in giving the
leave was not stated, but left to conjecture. Nothing was said
about further proceedings in the district court looking to a
compliance with the rule or about a remission of the transcript. We
think the mere leave to withdraw it was not enough. The fault was
not in the transcript, but in the proceedings had in the district
court whereby the evidence was attempted to be made a part of the
record. That court hardly would have regarded the order as
requiring it to take up those proceedings anew. The appellants were
entitled to a specific order operating as a direction to the
district court. Apparently the circuit court of appeals doubted its
power in the premises, and,
Page 276 U. S. 310
for that reason, was not disposed to give such an order. We
think the suggested waiver has no real basis.
The record does not show whether the rehearing was had, but does
show that the court made an order reciting that it adhered to its
original opinion and directing that the decree entered thereon be
reentered.
We come, then, to the terms upon which the appellants should be
given further opportunity to get the evidence into the record in
accordance with the rule. Of course, they should be required to
proceed with reasonable dispatch. In
Barber Asphalt Paving Co.
v. Standard Asphalt & Rubber Co., we directed that the
appellant be required to pay a stated sum by way of reimbursing the
appellee for counsel fees and expenses incurred in securing the
elimination of the irregular and objectionable statement of
evidence, and also to pay the costs in the circuit court of appeals
and in this Court. There, the appellee had objected in the circuit
court of appeals at the outset that the rule had not been complied
with, and therefore that the evidence could not be considered.
Here, the evidence was brought into the record in the irregular and
objectionable form under an express stipulation between the
parties, to which both adhered up to the time of the decision of
the circuit court of appeals. Thus, both parties were at fault. In
condemning the statement of the evidence, the circuit court of
appeals acted on its own motion. In these circumstances, we think
the appellants should not be required to make any payment by way of
reimbursing the appellees for counsel fees or expenses, and that
each party should be left to pay its costs in this Court and also
its costs in the circuit court of appeals up to the time our
mandate is carried into effect there.
The decree of the circuit court of appeals is accordingly
reversed, and the cause is remanded to that court for further
proceedings in conformity with this opinion.
Decree reversed.