American Coat Pad Co. of Baltimore City v. Phoenix Pad Co.

• Citation: 113 F. 629
• Decision Date: 04 February 1902
• Docket Number: 422.
• Parties: AMERICAN COAT PAD CO. OF BALTIMORE CITY v. PHOENIX PAD CO.
• Court: United States Courts of Appeals. United States Court of Appeals (4th Circuit)

113 F. 629

AMERICAN COAT PAD CO. OF BALTIMORE CITY v. PHOENIX PAD CO.

No. 422.

United States Court of Appeals, Fourth Circuit.

February 4, 1902

Richard S. Culbreth (Frederick M. Feldner, on the brief), for appellants.

Arthur Steuart, for appellee.

Before SIMONTON, Circuit Judge, and PURNELL and WADDILL, District judges.

PURNELL District Judge.

The appeal is from a decree of the circuit court of Maryland in a patent case, granting a preliminary injunction restraining appellants, defendants below, until the further order of the court, from infringing the patent rights which the appellee plaintiff below, claims to be entitled under letters patent No. 359,441, issued to Edward Goldman, dated March 13, 1887. The title of appellee to the letters patent is set out in the verified bill, supported by the affidavits of Gustay Goldman president of the appellee company, and others. Assuming title to the letters patent to be as stated, it is as follows: From Edward Goldman, patentee by assignment September 20, 1890, to the Eureka Coat Pad Company, and by assignment from the Eureka Coat Pad Company March 16, 1901, to the Phoenix Pad Company, appellee. The assignments are not controverted or questioned. This title is not denied. An answer under oath was waived in the usual form, but defendants, below appellants here, verified the answer, and filed therewith affidavits and exhibits consisting of certified copies of letters patent referred to in the answer. Several issues of fact are raised by the pleadings, a consideration of which at this time would tend to embarrass the trial court in the consideration of the case on the final hearing, and this court, should the case be again brought here by appeal. Loew Filter Co. v. German-American Filter Co., 47 C.C.A. 94, 107 F. 950. The cause is not in a condition to be heard as to these matters now, and it must be understood what is said is upon the record as now before the court, and not as to the merits as they may be hereafter presented.

It is stated in the brief of counsel for appellee and in the opinion of the court, which it is said the trial judge delivered before leaving the bench, that the validity of the plaintiff's patent and infringement by defendants are not denied. This statement must refer to something said on the hearing, of which this court knows nothing. An examination of the pleadings discloses the fact that defendant corporation, in the first allegation of its answer, sets out in full the answer of the Phoenix Coat Pad Company (to which it alleges the Phoenix Pad Company is to all intents and purposes successor) in 1889 to a bill filed by the Eureka Pad Company, denying the Goldman patent, alleging two prior patents, No. 41,073, January 5, 1864, to Moses A. Thompson, and No. 236,267, January 4, 1881, to Daniel T. Smith, and that Edward Goldman was not the inventor of the coat pad described, but the same was used many years before the parties in Cincinnati, Baltimore, and New York, naming them. The paragraph is adopted by defendants as part of their answer. Another suit (The Eureka Coat Pad Company v. H. M. Marcus & Bro.; 1890) is referred to as involving the Goldman letters patent, and it is conceded that neither of these cases came to a final hearing. There has been no adjudication as to the validity of said letters patent. The validity of the Goldman letters patent is therefore denied in the pleadings.

The infringement of plaintiff's letters patent is set out in paragraph 8 of the bill, and in the eighth paragraph of the defendants' answer are these words: 'The defendants deny the allegations of paragraph 8 of the bill. ' In the following two paragraphs of the answer defendants admit they have manufactured coat pads, but explain at some length this was done under letters patent No. 673,331, issued to Louis Bouchat, January 10, 1901, and setting out the difference between the coat pad thus manufactured and the coat pad for which the Goldman letters patent provide, and an improvement claimed in such coat pads so manufactured over the Goldman patent. The validity and infringement are thus denied, and clear-cut issues raised. An examination of the record discloses several defenses set up,-- no patentable subject of invention, prior use, no adjudication, no infringement, and ability to respond in damages. This is allowable by statutory provision. 29 Stat.c. 391; Bates, Fed. Eq. Proc. 331.

The ground upon which a preliminary injunction was granted is thus set out in the opinion of the court, which counsel say was delivered by the trial judge before he left the bench:

'This is a motion for a preliminary injunction by the Phoenix Pad Company against the American Coat Pad Company and Louis Bouchat for the infringement of letters patent No. 359,441. There has been no adjudication of the patent, but the motion is based upon public acquiescence and estoppel against the defendants. There are many circumstances which show acquiescence. The patent is one that has been in use now since 1887, and under its protection its various owners have established and maintained a business that has been acquiesced in by the competitors of the owner of the patent. There were two suits on the patent begun, but neither was brought to a final hearing. It is said the validity of the patent has been denied by the same persons who are now asserting it. They have been defendants in the previous suits; but I take it that those were the formal defenses; that the real defense in the Marcus case and the case brought against the Phoenix Coat Pad Company by the Eureka Coat Pad Company was noninfringement. Of course, counsel advised that other defenses should be made, and no doubt thought there was ground for them. But that was the answer made under advice of counsel, who made all the defenses that could reasonably be made. The circumstances of these cases tend to show an acquiescence. It is true there has been no adjudication which is required in many cases, but that which appeals most strongly to the conscience of the court is the circumstance which tended to show that Louis Bouchat, one of the defendants here, was a stockholder of the Eureka Company, which owned this patent; and I understand it to have been admitted at the hearing that he was the superintendent or general manager of the company at the time that it was making and selling coat pads under this patent and asserting it as valid, and at the time at which the Eureka Company sued the Phoenix Coat Pad Company, charging infringement of it. It is shown that he is the principal stockholder and manager of this new company. He was an important officer of some sort in the Eureka Company, which brought the former suit. It was settled by the defendant company, the predecessors of the present complainant, by buying all the stock. The patent was a valuable asset, and Bouchat received four times the original cost of the par value of the stock for his share of

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