140 F. 616 (S.D.N.Y. 1905), 7,175, Goldsmith v. Koopman

Docket Nº:7,175, 7,176.
Citation:140 F. 616
Party Name:GOLDSMITH v. KOOPMAN et al. REIZENSTEIN v. SAME.
Case Date:August 02, 1905
Court:United States Courts of Appeals, Court of Appeals for the Second Circuit
 
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Page 616

140 F. 616 (S.D.N.Y. 1905)

GOLDSMITH

v.

KOOPMAN et al.

REIZENSTEIN

v.

SAME.

Nos. 7,175, 7,176.

United States Circuit Court, S.D. New York.

August 2, 1905

Eugene Treadwell, Isaac Hassler, and Harrison B. Weil, for complainants.

Herman Aaron, Francis T. Homer, and Henry M. Brigham, for defendant Koopman.

Luther Shafer, for defendants Upton's executors.

PLATT, District Judge.

These are similar suits, brought by the respective complainants against their partners, to set aside a transfer

Page 617

of complainant's interest on the ground of fraud, to declare each complainant to be the owner of a one-fourth interest in the joint enterprise and in the profits growing out of it, and to require the defendants to pay over such share or interest, if the same be ascertainable, or to order an accounting if it be not. The defendant Koopman denies that any transfer was made to him, denies any fraudulent representations or concealment of pertinent facts which induced the transfer, and claims that the complainants are limited in recovery, or cannot recover at all, by reason of an alleged license agreement made by the copartnership long prior to the transfer which it is sought to set aside. The answer of the executors of the deceased partner, Charles S. Upton, admits his -death and their appointment, but denies any knowledge or information by said defendants of or concerning other allegations in the bill contained.

It is possible to treat both cases together, and what shall be said herefrom will be understood to contain some of the reasons for the action which will follow.

Complainant Goldsmith in 1890 obtained letters patent for a pocket savings bank in the United States, England, and continental countries. Pending the applications, he assigned to complainant Reizenstein an undivided one-half interest in the foreign patents, and licensed the Magic Introduction Company to manufacture and sell banks under the United States patent. Defendant Upton was president of the Magic Introduction Company, and defendant Koopman was treasurer and manager. Henry M. Brigham was a patent lawyer in New York of some experience. When the United States patent issued, Mr. Brigham thought its claims too narrow, and prepared a model bank, to avoid infringement, applying for a patent thereon November 26, 1890. This was transferred to the Magic Introduction Company. Goldsmith was forced on that account to reduce his royalties, and the patent was then transferred to him. Brigham, at the same time, obtained his interest in the foreign patents by threats of patenting his United States patent abroad and using it in competition. Koopman also got a one-fourth interest in the foreign business by promising active assistance and co-operation in marketing the goods abroad. On January 20, 1891, therefore, an agreement was made between Goldsmith, Reizenstein, Koopman, and Henry M. Brigham, pooling the foreign patents, and fixing the interests at one undivided fourth each, including all future inventions. Goldsmith, to avoid foreign complications like those domestic already incurred, applied through English solicitors, selected by Koopman, and obtained on March 31, 1891, a second English patent, with more specific claims. In the meantime, capital was essential, and an agreement was entered into April 11, 1891. Goldsmith, Reizenstein, and Koopman kept their original one-fourth each, but Brigham's fourth was divided; Henry M. Brigham taking one-eighth, and Charles S. Upton and John H. Brigham each one-sixteenth, and $2,000...

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