Lanteen Labs., Inc. v. Clark

• Citation: 13 N.E.2d 678,294 Ill.App. 81
• Decision Date: 11 March 1938
• Docket Number: Gen. No. 39352.
• Parties: LANTEEN LABORATORIES, INC., v. CLARK.
• Court: United States Appellate Court of Illinois

294 Ill.App. 81

13 N.E.2d 678

LANTEEN LABORATORIES, INC.,

v.CLARK.

Gen. No. 39352.

Appellate Court of Illinois, First District, Second Division.

March 11, 1938.

Appeal from Superior Court, Cook County; Walter T. Stanton, Judge.

Suit by the Lanteen Laboratories, Incorporated, against Percy L. Clark, Jr., an individual doing business under the name Clinic Supply Company, for specific performance of a written contract for services to be rendered to plaintiff by defendant. From a decree dismissing the complaint, the plaintiff appeals.

Affirmed. Defrees, Buckingham, Jones & Hoffman, of Chicago (Don Kenneth Jones and Chas. O. Butler, both of Chicago, of counsel), for appellant.

Charles F. Murray, of Chicago (B. W. Rosenstone and D. R. Murray, both of Chicago, of counsel), for appellee.

SCANLAN, Justice.

This is a complaint in the nature of a bill for specific performance of certain provisions of a written contract for services to be rendered to plaintiff by defendant and his brother, John Clark. Plaintiff appeals from a decree dismissing its complaint for want of equity.

At the request of the parties the trial court appointed a patent attorney, practicing at the Chicago bar, “a special commissioner in chancery with all the powers of a master in chancery.” After a hearing, the commissioner filed a report recommending that the temporary restraining order that had been entered should be dissolved and the complaint dismissed for want of equity. The decree entered accords with the recommendations of the commissioner.

The commissioner found that at the time the written contract was executed “plaintiff was engaged in the sale of devices and preparations for use by women for birth control purposes,” and that defendant and his brother were engaged in a like business. The contract required defendant and his brother to render services in the experimental development of rubber tampons or diaphragms for use by women for contraceptive purposes, and provided that they would assign to plaintiff, at its request, any and all patent applications relating to said articles which either or both of them might file during said employment and for a period of five years thereafter; and that they “agree to refrain either directly or indirectly from competing with” plaintiff “in the manufacture and sale of inflatable and insertable tampons during their period of employment * * * or within five years thereafter, provided, however, that the said John Clark and Percy Clark shall have the right to make and sell during such period diaphragms of the type which they are now engaged in making, or any type not including the idea of inflation.” The only change made in the contract as it was prepared by plaintiff's attorney was the insertion of the italicized words, which were substituted, at the request of defendant and his brother, for the following words, “namely, only cup shaped diaphrams having a single wall.” The active employment of defendant under the contract terminated about August 1, 1931, and on November 2, 1935, he filed an application for a patent for “a pessary or vaginal diaphragm and an applicator therefor. * * * One of the objects of the present invention is to provide a device of the character described that will be, to a certain extent, universally adaptable, so far as size and location of the organs is concerned.” Plaintiff contended before the commissioner, and contends here, that the application covered an invention “such as the contract contemplated and hence should be assigned to the plaintiff,” and that this suit was instituted after defendant refused to assign the application. While defendant was engaged in experimental work, under the contract, a contraceptive, called by plaintiff “Lanteen Browns,” was “developed,” and placed on the market by plaintiff in December, 1931, or early in January, 1932. It was designed to be sold “through drug channels,” and was so sold. Plaintiff obtained a patent on this article.

The special commissioner was appointed because the parties regarded him as learned in the matter of patents. He states that he had the benefit of able briefs of counsel, and that, after giving careful consideration to the arguments and the evidence, he reached the conclusion that the contract between the parties did not cover the device for which defendant had filed the application for a patent. The trial court reached the same conclusion. We agree with the conclusion reached by the commissioner and the trial court.

Both parties to this suit are engaged in the sale of contraceptives, and the question as to whether or not the contract was against public policy was not raised nor suggested in the trial court nor here, but, as we are of the opinion that the contract is tainted with illegality, we will, sua sponte, raise that question, for, if we ignored it, it might be reasonably assumed that we considered the contract a legal one. The bold position assumed by plaintiff in this court challenges our attention.

In plaintiff's brief its counsel make the following statement as to the history of the relationship between the parties, the character and purpose of the contraceptive plaintiff desired defendant to design, and the manner in which plaintiff proposed to sell the article, if one were designed: “For about two years prior to November, 1930, plaintiff, Lanteen Laboratories had been engaged in the sale of devices and preparations for birth control purposes. * * * Plaintiff opened a clinic about January 1, 1929 (which is still in operation), staffed by women physicians and registered nurses who made individual vaginal examinations of thousands of women patients yearly to determine which size of hemispherical diaphragm was best adapted to each patient. It was impossible to fit all patients with one size of diaphragm; in fact it was necessary to use about twenty different sizes of hemispherical diaphragms whose diameter ranged from 50 to 95 millimeters (2 1/8 to 3 3/4 inches), in order to provide accurate and satisfactory fittings. Plaintiff's president had previously made an exhaustive study of medical literature pertaining both to the anatomy of the vagina and surrounding organs and to contraceptive methods and devices. He directed the technique employed at the clinic and received daily reports in writing and held many conferences with the clinic staff regarding the problems encountered. Through his study of the subject and the information he acquired from the operation of the clinic, plaintiff's president learned that only about two to five per cent. of the patients interested in acquiring birth control information were willing to apply for this information to a physician because of hesitancy in submitting to the then necessary vaginal examination. Plaintiff's president perceived that there was a distinct need for a contraceptive device that would have a dependability at least equal to that provided by a hemispherical diaphragm, yet could be made and sold in one size only and so designed as to be able to fit the varying anatomies of a large percentage of all women. Such a device, he believed, could be marketed through the drug stores where the public customarily buys large quantities of medical and personal supplies over the counter. If such a device could be so designed that it would not require individual fitting, women desiring this birth control device could acquire it without the embarrassment of a vaginal examination, simply by buying it in drug stores. The plaintiff's president, Mr. Riddlesbarger, did not know at the outset just how such a universal fitting diaphragm should be constructed, but he proposed to have a series of experimental models made, have each model tested at the clinic and utilize the information so gained to modify the design of subsequent models until he could arrive at, if possible, a diaphragm design which would be universally adaptable to normal anatomies and suitable for sale in drug stores. Since Lanteen Laboratories had no equipment for, or men experienced in the manufacture of rubber diaphragms, the Clark brothers, who possessed a modest amount of equipment and experience in this field, were retained by plaintiff to mold the various experimental rubber models which Mr. Riddlesbarger contemplated would be needed in the course of his efforts to produce a universal fitting diaphragm. Mr. Riddlesbarger explained to the Clark brothers, before they signed the contract on November 13, 1930, that he was attempting to design and perfect a universal fitting diaphragm.” Counsel further state “that the object of the contract was to develop, if possible, for marketing through drug channels, a universal fitting diaphragm”; that the patent application of defendant covers an invention such as the contract contemplated; that it is superior in design to “Lanteen Browns” and should be assigned to plaintiff. The counsel further state, and the proof shows, that practically all of plaintiff's sales of “Lanteen Browns” diaphragms were made through drug stores and that the sales were increasing yearly. The president of the corporation testified that in four years the sales increased from 5,000 a year to 112,000 a year; that “more than ninety per cent were sold through drug stores.” In a letter written by plaintiff to defendant and John Clark shortly after the contract was signed, it is stated that any “patentable item” developed by defendant and John Clark would be added to the “Lanteen line” and sold “through drug channels.”

...