Bowers v. Atlantic, G. & P. Co.

• Decision Date: 22 November 1900
• Citation: 104 F. 887
• Parties: BOWERS et al. v. ATLANTIC, G.& P. CO. et al.
• Court: U.S. District Court — Southern District of New York

104 F. 887

BOWERS et al. v. ATLANTIC, G.& P. CO. et al.

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

November 22, 1900

John H Miller and Howard R. Bayne, for complainants.

Edwin H. Brown, for defendants.

COXE District Judge.

The complainants, who are citizens, respectively, of California and Illinois, file their bill in the usual form charging the defendants with infringement of complainants' patents for improvements in dredging machines. The pleas were set down for argument by the complainants, the facts admitted being as follows: First. The Atlantic, Gulf and Pacific Company is a West Virginia corporation and an inhabitant of that state. Second. The said corporation has a regular and established place of business in this district. Third. The said corporation has never infringed in this district, the infringement complained of having occurred at Savannah in the state of Georgia. Fourth. The defendant Catt is the president of the said corporation and for eight years has resided in the Eastern district of New York. The defendant Wood is the corporation's secretary and treasurer and resides in this district. Fifth. The action was commenced July 10, 1900. As to the corporation, then, the question is whether or not the suit can be maintained upon the sole ground that the defendant has a place of business in the city of New York or is found there. In other words, can a West Virginia corporation be sued in the Southern district of New York for an infringement committed in Georgia?

The act of March 3, 1897 (29 Stat. 695), is as follows:

'Chap 395. An act defining the jurisdiction of the United States circuit courts in cases brought for the infringement of letters patent.

'Be it enacted by the senate and house of representatives of the United States of America in congress assembled, that in suits brought for the infringement of letters patent the circuit courts of the United States shall have jurisdiction, in law or in equity, in the district of which the defendant is an inhabitant, or in any district in which the defendant, whether a person, partnership, or corporation, shall have committed acts of infringement and have a regular and established place of business. If such suit is brought in a district of which the defendant is not an inhabitant, but in which such defendant has a regular and established place of business, service of process, summons, or subpoena upon the defendant may be made by service upon the agent or agents engaged in conducting such business in the district in which suit is brought. Approved, March 3, 1897.'

This is the latest legislative deliverance upon the subject, and there can be no question that under its provisions, considered alone, the only districts where the court has jurisdiction are, first, the district of which the defendant is an inhabitant, and, second, the district where the defendant infringes and has a regular place of business. If, then, there were no other provision of law, it is manifest that this action could not be maintained in this district, and could only be maintained either in the district of West Virginia or in the Southern district of Georgia, provided he defendant has a regular place of business there. The law says, if a corporation be sued outside the district of which it is an inhabitant, that it must be in a district where there is infringement and a regular place of business. Infringement alone will not give jurisdiction, a regular place of business alone will not give jurisdiction, both must concur. This is the law of 1897. But it is argued that the law must be interpreted in the light of existing and pre-existing statutes, and as so construed it does not restrict but enlarges the jurisdiction of the court,-- providing an additional place where the defendant may be sued, namely, the district where he infringes and has an established place of business. If this be the proper construction of the act an infringement suit may be brought first, in the district of which the defendant is an inhabitant; second, in the district where he is found; and, third, in the district where infringement occurs and where the defendant has an established place of business. A defendant residing in Maine and having a place of business and infringing at Boston could, under this construction, be sued in Maine, in Massachusetts, or, if he happened to be in Texas, or Oregon, he could be sued there. On the other hand, if the defendants' construction be correct, such a defendant could be sued only in Maine, where he lives, or in Massachusetts, where he transacts business and infringes. Prior to March 3, 1887, the courts of the United States had almost unlimited jurisdiction, and could hold a defendant in any district where he chanced to be and was served with process. The abuses which this condition of affairs permitted were many and serious, and it was largely to correct them that the act of 1887-88 was passed. That act has always been regarded as a restrictive measure. That it limited the jurisdiction of the federal courts in several important particulars is beyond dispute. Shaw v. Mining Co., 145 U.S. 444, 12 S.Ct. 935, 36 L.Ed. 768; Machine Co. v. Walthers, 134 U.S. 41, 10 S.Ct. 485, 33 L.Ed. 833; Manufacturing Co. v. Watson (C. C.) 74 F. 418. The purpose of the act being to narrow the federal jurisdiction, it may well be inferred that congress intended to limit it as to all classes of actions, infringement suits included, for in no branch were complaints of injustice and oppression more numerous. In this congress failed. In the Hohorst Case, 150 U.S. 653, 14 Sup.Ct. 221, 37 L.Ed. 1211, the supreme court decided, in December, 1893, 'that the provision of the existing statute, which prohibits suit to be brought against any person 'in any other district than that whereof he is an inhabitant,' is inapplicable to an alien or a foreign corporation sued here, and especially to a suit for the infringement of a patent right; and that, consequently, such a person or corporation may be sued by a citizen of a state of the Union in any district in which valid service can be made upon the defendant. ' The circuit courts quite generally accepted this decision as holding, by implication, that the provision quoted from the act of 1887 was applicable to all defendants except aliens and corporations of foreign countries. The courts still declined, in numerous instances, to assume jurisdiction in infringement suits where the defendant was a citizen of the United States and was sued in a district of which he was not an inhabitant. Union Switch & Signal Co. v. Hall Signal Co. (C.C.) 65 F. 625; Donnelly v. Cordage Co. (C.C.) 66 F. 613. Although it was decided in Smith v. Manufacturing Co. (C.C.) 67 F. 801, that the Hohorst Case was applicable to all infringement suits, the contrary doctrine was followed thereafter in this district in at least two unreported cases. Button Works v. Wade (C.C.) 72 F. 298.

This was the situation when, in December, 1895, the case of In re Keasbey & Mattison Co., 160 U.S. 221, 16 Sup.Ct. 273, 40 L.Ed. 402, was decided. Although that case arose under the act of March 3, 1881, and related to the infringement of a trade-mark, the court took occasion to comment upon and restate its decision in the Hohorst Case in language so plain that the circuit courts were no longer in doubt as to the scope of the decision. The court says (page 230, 160 U.S.,page 275, 16 Sup.Ct.,and page 405, 40 L.Ed.):

'It was a suit for infringement of a patent right, exclusive jurisdiction of which had been granted to the circuit courts of the United States by section 629, cl. 9, and section 711, cl. 5, of the Revised Statutes, re-enacting earlier acts of congress; and was therefore not affected by general provisions regulating the jurisdiction of the courts of the United States, concurrent with that of the several states.'

The circuit courts accepted this statement as a definitive settlement of the vexed question, and thereafter it was held that the act of 1887 did not affect infringement suits and that the jurisdiction was as broad as it had been before the passage of that act. Van Patten v. Railroad Co (C.C.) 74 F. 981, 989; Earl v....