American Well Works Company v. Layne Bowler Company

• Decision Date: 22 May 1916
• Docket Number: No. 376,376
• Citation: 36 S.Ct. 585,60 L.Ed. 987,241 U.S. 257
• Parties: AMERICAN WELL WORKS COMPANY, Plff. in Err., v. LAYNE & BOWLER COMPANY and Mahlon E. Layne
• Court: U.S. Supreme Court

241 U.S. 257

36 S.Ct. 585

60 L.Ed. 987

AMERICAN WELL WORKS COMPANY, Plff. in Err.,

v LAYNE & BOWLER COMPANY and Mahlon E. Layne.

No. 376.

Argued and submitted May 5, 1916.

Decided May 22, 1916.

Mr. David A. Gates for plaintiff in error.

Messrs. Paul Synnestvedt, Coke K. Burns, and J. M. Moore for defendants in error.

Mr. Justice Holmesdelivered the opinion of the court:

This is a suit begun in a state court, removed to the United States court, and then, on motion to remand by the plaintiff, dismissed by the latter court, on the ground that the cause of action arose under the patent laws of the United States, that the state court had no jurisdiction, and that therefore the one to which it was removed had none.There is a proper certificate and the case comes here direct from the district court.

Of course the question depends upon the plaintiff's declaration.The Fair v. Kohler Die & Specialty Co.228 U. S. 22, 25, 57 L. ed. 716, 717, 33 Sup. Ct. Rep. 410.That may be summed up in a few words.The plaintiff alleges that it owns, manufactures, and sells a certain pump, has or has applied for a patent for it, and that the pump is known as the best in the market.It then alleges that the defendants have falsely and maliciously libeled and slandered the plaintiff's title to the pump by stating that the pump and certain parts thereof are infringements upon the defendant's pump and certain parts thereof, and that without probable cause they have brought suits against some parties who are using the plaintiff's pump, and that they are threatening suits against all who use it.The allegation of the defendants' libel or slander is repeated in slightly varying form, but it all comes to statements to various people that the plaintiff was infringing the defendants' patent, and that the defendant would sue both seller and buyer if the plaintiff's pump was used.Actual damage to the plaintiff in its business is alleged to the extent of $50,000, and punitive damages to the same amount are asked.

It is evident that the claim for damages is based upon conduct; or, more specifically, language, tending to persuade the public to withdraw its custom from the plaintiff, and having that effect to its damage.Such conduct, having such effect, is equally actionable whether it produces the result by persuasion, by threats, or by falsehood (Moran v. Dunphy, 177 Mass. 485, 487, 52 L.R.A. 115, 83 Am. St. Rep. 289, 59 N. E. 125), and it is enough to allege and prove the conduct and effect, leaving the defendant to justify if he can.If the conduct complained of is persuasion, it may be justified by the fact that the defendant is a competitor, or by good faith and reasonable grounds.If it is a...