Burton v. Burton Stock-car Co.

• Decision Date: 22 June 1898
• Citation: 50 N.E. 1029,171 Mass. 437
• Parties: BURTON v. BURTON STOCK-CAR CO.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

171 Mass. 437

50 N.E. 1029

BURTON v. BURTON STOCK-CAR CO.

Supreme Judicial Court of Massachusetts, Suffolk.

June 22, 1898

COUNSEL

George L. Huntress and Homer Albers, for plaintiff.

Samuel J. Elder and Robert F. Herrick, for defendant.

OPINION

FIELD C.J.

It appears that all the acts done by the defendant in building and rebuilding cars, as charged in the first, second, and sixth counts of the declaration, were done between the dates of the several applications for letters patent and the issue of the patents. These counts erroneously averred that these acts were done while the plaintiff was the owner of the letters patent, but no objection is urged on account of the variance.

We have first to consider whether, upon the evidence, the plaintiff was entitled to go to the jury. It must be treated as settled that before the granting of a patent an inventor has a qualified property in his invention, which is assignable, and which may have a value, and thus serve as a consideration for a promise to pay for a transfer and sale. Gayler v Wilder, 10 How. 476; Railroad Co. v. Trimble, 10 Wall. 367, 379; Pavement Co. v. Jenkins, 14 Wall 452; Hendrie v. Sayles, 98 U.S. 546; Dalzell v. Manufacturing Co., 149 U.S. 315, 13 Sup.Ct. 886; Jones v. Sewall, 6 Fish.Pat.Cas. 343, Fed.Cas.No.7,495; Binney v. Annan, 107 Mass. 94; Somerby v. Buntin, 118 Mass. 279; Lamson v. Martin, 159 Mass. 557, 562, 35 N.E. 78; Clum v. Brewer, 2 Curt. 520, Fed.Cas.No.2,909. This doctrine is not impugned in Marsh v. Nichols, 128 U.S. 605, 9 Sup.Ct. 168, or Durham v. Seymour, 161 U.S. 235, 16 Sup.Ct. 452, as we understand these decisions. It follows from this that a license may also be given before the granting of the patent, if given without restriction, and, if acted on by applying the invention to machines or mechanisms constructed before the granting of the patent, will avail to protect the licensee in their use afterwards. Such license may be inferred from circumstances, and an implied promise to pay reasonable compensation therefor may also be so inferred. McClurg v. Kingsland, 1 How. 202, 208; U.S. v. Palmer, 128 U.S. 262, 9 Sup.Ct. 104; Solomons v. U.S., 137 U.S. 342, 11 Sup.Ct. 88.

The circumstances of the present case were sufficient to warrant a finding of such license by the plaintiff, and of such implied promise to pay by the defendant, and of the sufficiency of the consideration for such implied promise. The plaintiff was in the employment of the defendant during the period in question. The auditor found that during this time he attended regularly to the duties of his various positions, and did not use either the material or means of the defendant in taking out the letters patent; that he personally paid all the expenses of procuring them, and constantly asserted his right to the personal ownership thereof; and that all of these improvements were used by the defendant on more or less of its cars. It is not now contended that the defendant became the owner of the improvements by virtue of its employment of the plaintiff. Hapgood v. Hewett, 119 U.S. 226, 7 Sup.Ct. 193; U.S. v. Palmer, 128 U.S. 262, 9 Sup.Ct. 104; Lane & Bodley Co. v. Locke, 150 U.S. 193, 198, 14 Sup.Ct. 78.

In reference to the matter of compensation the auditor found "that the plaintiff's brother, who was throughout the time of plaintiff's employment a director of the defendant corporation, and during that period also was, consecutively, treasurer, superintendent of construction, and assistant general manager of the defendant, was aware of the use by the defendant of the plaintiff's improvements, and of his claim for reasonable compensation for such use; that both he and the president of the defendant corporation wrote to and talked with the plaintiff with reference to such use, and his claim for compensation, at various times; and that several of the directors of the defendant knew that the defendant was making use of the plaintiff's improvements, and that the plaintiff would claim compensation therefor." He also found that in 1893, while still in the defendant's employment, the plaintiff assigned to the defendant all but one of his patents, and was paid therefor by the defendant the expense to which he had been put in perfecting the improvements and procuring the patents; that the plaintiff was requested by certain officers of the defendant so to assign them, "and that the plaintiff at that time asserted to said officers that he did not waive his right to royalty for the former use of his improvements by the defendant, but should insist upon future payment therefor; that the plaintiff was assured by said officers that his claim would be adjusted at a later time." There was no evidence, so far as appears, that the plaintiff agreed to license the use of his improvements gratuitously, and in the absence of such an agreement an implied promise to pay might be inferred from the above facts. Walk. Pat. (3d Ed.) § 312. The expression in the auditor's report, that he rules that the plaintiff is entitled to recover reasonable compensation, is not to be taken as a ruling that as matter of law the facts reported necessarily entitled the plaintiff so to recover. He had been asked to rule as matter of law that the plaintiff could not recover any compensation for the use of his improvements while he was in the defendant's employment, and the ruling seems to mean that he was not debarred from recovery on the ground stated. If it means more than this, it must be treated as a finding of fact, or perhaps as a statement that the plaintiff is entitled to recover provided the facts reported would warrant it. There was no motion to recommit the report for a more explicit statement by the auditor, and no exception was taken which called special attention to this expression. It becomes unnecessary to consider whether upon the auditor's report an express promise was or could be found, or to deal further with the criticisms upon it.

The course of the trial was as follows: "Plaintiff's counsel, in opening, stated that he would rely upon the auditor's report, and rest upon it, as to all matters excepting as to the question of the amount to be paid for the use of the inventions and devices declared upon, and that upon this point he would put in such further evidence as he wished, and then rest, reserving the right, with court's permission, to introduce evidence in support of the auditor's report at the close of defendant's case if he so elected." The auditor's report recites as follows: "The plaintiff introduced evidence tending to show that by the use of the plaintiff's improvements the defendant could obtain a royalty of $20 per car for the use of its patents on stock cars, and claimed that the plaintiff should recover of the defendant at that rate for each car used by the defendant, and...