Mitchell & Weber v. Williamsbridge Mills

• Citation: 14 F. Supp. 954
• Parties: MITCHELL & WEBER, Inc., v. WILLIAMSBRIDGE MILLS, Inc., et al.
• Decision Date: 16 March 1936
• Court: U.S. District Court — Southern District of New York

14 F. Supp. 954

MITCHELL & WEBER, Inc., v. WILLIAMSBRIDGE MILLS, Inc., et al.

District Court, S. D. New York.

March 16, 1936.

George J. Beldock, of New York City (Lawrence Bloomgarden, of New York City, of counsel), for plaintiff.

Frances Kneitel, of New York City (Irving J. Mishkin, of New York City, of counsel), for defendants.

PATTERSON, District Judge.

The suit is brought under the Declaratory Judgment Act (Jud.Code, § 274d, 28 U.S.C.A. § 400). Motion is made for preliminary injunction. Whether the plaintiff is entitled to preliminary injunction is the matter for determination.

The bill shows that the plaintiff and the defendant Williamsbridge Mills are New York corporations, competitively engaged in the blouse business; that two design patents on styles of blouses were recently issued to the defendant Hyman, who gave an exclusive license under the patents to Williamsbridge Mills; that the plaintiff had made and sold blouses embodying these very designs long before Hyman filed applications for patent, to Hyman's own knowledge, and that both patents are void; that Williamsbridge Mills, though cognizant of the invalidity of the patents, is now sending letters to the plaintiff's customers, telling them that the plaintiff's blouses infringe the patents, to the plaintiff's irreparable injury. The relief asked is a decree (1) declaring that the defendants' patents are void and that the plaintiff has a right to continue manufacture of the blouses without interference from the defendants, and (2) restraining the defendants from representing to the plaintiff's customers that its blouses infringe the patents. Damages were also demanded originally, but this demand has been withdrawn.

The preliminary injunction asked for is to restrain the defendants pending suit from continuing to hold out to the plaintiff's customers that the plaintiff's products are infringements of patents and from continuing to threaten such customers with suits for infringement. The papers supporting the motion make it clear that months before Hyman applied for her patents the plaintiff made and sold blouses identical to the two patented designs and such blouses were being advertised and sold to the general public by retailers. Pictures of both blouses were published in advertisements appearing in newspapers of wide circulation and in magazines. All of these publicized pictures antedated the patent applications, and several of them were shown to have been inserted by the plaintiff's customers. The plaintiff also shows convincingly that it had sketches of the designs made and sent to department stores long before the patent applications were filed. Exhibits showing these advertisements and sketches are annexed to the moving papers.

The papers in opposition do not contradict any of these facts or defend the patents. An officer of Williamsbridge Mills asserts merely that the patents were taken out by Hyman, an employee, that Williamsbridge Mills "has no way of knowing the source of the designs," and that it acted in good faith. There is no adfidavit from Hyman, the alleged inventor, although she is still in the employ of the Williamsbridge Mills.

The case for the plaintiff is an unusually strong one on the facts. The facts arrayed show that the patents are void beyond doubt, that the defendants must have known that they were void, and that the threats of infringement against the plaintiff's customers are made in bad faith. The single point pressed by the defendants is that the court has no power to give an injunction, either preliminary or final, against circularizing the plaintiff's customers, this being a claim of unfair competition and there being no diversity of citizenship.

It is quite true that in its injunctive aspect the bill savors somewhat of unfair competition, and that the motion for preliminary injunction also savors of unfair competition. It is also true that the federal courts, unless there be diversity of citizenship, have no jurisdiction of a suit for unfair competition. The rule holds even where the acts complained of are threats to sue under the patent law. American Well Works Co. v. Layne & Bowler Co., 241 U.S. 257, 36 S.Ct. 585, 60 L.Ed. 987.

On the other hand, the bill in its other aspect, that for declaratory judgment, shows a case within the jurisdiction. A suit to have a patent declared void is one arising under the patent laws and is within the jurisdiction of the District Court, now that the Declaratory Judgment Act has furnished the necessary procedural machinery. Zenie Bros. v. Miskend, 10 F. Supp. 779 (D.C.N.Y.); Automotive Equipment v. Trico Products Corporation, 11 F. Supp. 292 (D.C.N.Y.); Lionel Corporation v. De Filippis, 11 F.Supp. 712 (D.C. N.Y.). See 45 Yale Law Journal, p. 160. So the point for decision is whether the court, possessing jurisdiction of the suit in so far as it is sought to have the defendants' patents adjudged void, may entertain also the feature of the suit involving unfair competition in the obtaining of the patents and the use made of them.

The law controlling this matter is laid down in Hurn v. Oursler, 289 U.S. 238, 53 S.Ct. 586, 77 L.Ed. 1148. The plaintiffs had a copyrighted play. They complained of a play produced by the defendants, as an infringement of the copyright and also as constituting unfair competition. There was no diversity of citizenship. It was held that the District Court had jurisdiction to decide the case on both claims. The rule was laid down that where two distinct grounds in support of a single cause of action are alleged in a bill, one of which presents a federal question substantial in character, the other being nonfederal, the District Court may retain the entire suit and decide all questions raised in it. The distinction was made between such a case and a case where a separate and distinct nonfederal cause of action was joined in the same pleading with a...