314 U.S. 488 (1942), 49, Morton Salt Co. v. G. S. Suppiger Co.

Docket Nº:No. 49
Citation:314 U.S. 488, 62 S.Ct. 402, 86 L.Ed. 363
Party Name:Morton Salt Co. v. G. S. Suppiger Co.
Case Date:January 05, 1942
Court:United States Supreme Court
 
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Page 488

314 U.S. 488 (1942)

62 S.Ct. 402, 86 L.Ed. 363

Morton Salt Co.

v.

G. S. Suppiger Co.

No. 49

United States Supreme Court

Jan. 5, 1942

Argued December 10, 1941

CERTIORARI TO THE CIRCUIT COURT OF APPEALS

FOR THE SEVENTH CIRCUIT

Syllabus

1. A corporation, engaged through a wholly owned subsidiary in the business of selling salt tablets to the canning trade, and which also

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owned a patent on a machine for depositing such tablets in the process of canning, made a practice of licensing canners to use its machines, but only upon condition that the tablet used with them be bought from the subsidiary.

Held:

(1) That this use of the patent monopoly to restrain competition in the marketing of the unpatented tablets for use with the patented machines, and to aid in the creation of a limited monopoly in the tablets not within that granted by the patent, is contrary to the public policy of the United States evinced by the Constitution and the patent law. P. 491.

(2) The patentee, while engaged in such practice, cannot have an injunction to retrain the making and leasing of infringing machine. P. 492.

2. It is a principle of general application that courts, and especially courts of equity, may appropriately withhold their aid where the plaintiff is using the right asserted contrary to the public interest. P. 492.

117 F.2d 968 reversed.

Certiorari, 313 U.S. 555, to review the reversal of a decree, 31 F.Supp. 876, dismissing a bill to enjoin alleged infringements of a patent, and for an accounting.

STONE, J., lead opinion

MR. CHIEF JUSTICE STONE delivered the opinion of the Court.

Respondent brought this suit in the district court for an injunction and an accounting for infringement of its Patent No. 2,060,645, [62 S.Ct. 404] of November 10, 1936, on a machine for depositing salt tablets, a device said to be useful in the canning industry for adding predetermined amounts of salt in tablet form to the contents of the cans.

Upon petitioner's motion, pursuant to Rule 56 of the Rules of Civil Procedure, the trial court, without passing

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on the issues of validity and infringement, granted summary judgment dismissing the complaint. It took the ground that respondent was making use of the patent to restrain the sale of salt tablets in competition with its own sale of unpatented tablets, by requiring licensees to use with the patented machines only tablets sold by respondent. The Court of Appeals for the Seventh Circuit reversed, 117 F.2d 968, because it thought that respondent's use of the patent was not shown to violate § 3 of the Clayton Act, 15 U.S.C. § 14, as it did not appear that the use of its patent substantially lessened competition or tended to create a monopoly in salt tablets. We granted certiorari 313 U.S. 555, because of the public importance of the question presented and of an alleged conflict of the decision below with B. B. Chemical Co. v. Ellis, 117 F.2d 829, and with the principles underlying the decisions in Carbice Corp. v. American Patents Corp., 283 U.S. 27, and Leitch Mfg. Co. v. Barber Co., 302 U.S. 458.

The Clayton Act authorizes those injured by violations tending to monopoly to maintain suit for treble damages and for an injunction in appropriate cases. 15 U.S.C. §§ 1, 2, 14, 15, 26. But the present suit is for infringement of a patent. The question we must decide is not necessarily whether respondent has violated the Clayton Act, but whether a court of equity will lend its aid to protect the patent monopoly when respondent is using it as the effective means of restraining competition with its sale of an unpatented article.

Both respondent's wholly owned subsidiary and the petitioner manufacture and sell salt tablets used and useful in the canning trade. The tablets have a particular configuration rendering them capable of convenient use in respondent's patented machines. Petitioner makes and leases to canners unpatented salt deposition machines,

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charged to infringe respondent's patent. For reasons we indicate later, nothing turns on the fact that petitioner also competes with respondent in the sale of the tablets, and we may assume for purposes of this case that petitioner is doing no more than making and leasing the alleged infringing machines. The principal business of respondent's subsidiary, from which its profits are derived, is the sale of salt tablets. In connection with this business, and as an adjunct to it, respondent leases its patented machines to commercial canners, some two hundred in all, under licenses to use the machines upon condition and with the agreement of the licensees that only the subsidiary's salt tablets be used with the leased machines.

It thus appears that respondent is making use of its patent monopoly to restrain competition in the marketing of unpatented articles, salt tablets, for use with the patented machines, and is aiding in the creation of a limited monopoly in the tablets not within that granted by the patent. A patent operates to create and grant to the patentee an...

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