Caterpillar Tractor Co. v. International H. Co.

• Decision Date: 04 October 1939
• Docket Number: No. 9149.,9149.
• Citation: 106 F.2d 769
• Parties: CATERPILLAR TRACTOR CO. v. INTERNATIONAL HARVESTER CO.
• Court: U.S. Court of Appeals — Ninth Circuit

106 F.2d 769 (1939)

CATERPILLAR TRACTOR CO. v. INTERNATIONAL HARVESTER CO.

No. 9149.

Circuit Court of Appeals, Ninth Circuit.

October 4, 1939.

COPYRIGHT MATERIAL OMITTED

Chas. M. Fryer, Alfred C. Aurich, and Harold Johnson, all of San Francisco, Cal., for appellant.

Alfred Sutro, of San Francisco, Cal., and Percy S. Webster, of Stockton, Cal., and Wm. S. Elliott, Paul O. Pippel, George L. Wilkinson, and Charles L. Byron, all of Chicago, Ill. (Pillsbury, Madison & Sutro, of San Francisco, Cal., and Wilkinson, Huxley, Byron & Knight, of Chicago, Ill., of counsel), for appellee.

Before DENMAN, MATHEWS, and STEPHENS, Circuit Judges.

STEPHENS, Circuit Judge.

This is an appeal from portions of a final decree of the United States District Court, rendered after the granting of a motion for judgment on the pleadings in an action for declaratory relief. 28 U.S.C. A. § 400.¹ For clarity the appellant and appellee will be referred to as defendant and plaintiff respectively.

An answer was filed to the original complaint, and thereafter amendments adding other allegedly pertinent patents were made to the complaint. The amendments and original complaint were engrossed and the complaint and amendments as so engrossed were filed as amended bill of complaint. Other allegedly pertinent patents were later added as an amendment to this pleading. The defendant filed its answer to the amended bill of complaint and amendment thereto, and shortly thereafter the plaintiff filed its motion for judgment on the pleadings. We regard the allegations of the amendments to the complaint and of the answer as of the date of the filing of the original complaint, in the absence of any specific allegation of any fact occurring after that date. Denials on the ground that the party is without any knowledge we regard as complying with Rule 8(b) of the Federal Rules of Civil Procedure, 28 U.S.C.A. following section 723c, relative to denials based upon the absence of knowledge or information sufficient to form a belief as to the truth of an averment. The rules should be reasonably and not technically construed.

It is to these amended pleadings that we must look to determine the question of whether the trial court erred in granting plaintiff's motion for judgment on the pleadings. Grubbs v. Smith, 6 Cir., 1936, 86 F.2d 275, certiorari denied 300 U.S. 658, 57 S.Ct. 437, 81 L.Ed. 867, and cases cited therein.

It is undisputed in the pleadings that the defendant owns or controls numerous patents relating to a specie of automotive machine termed track type tractor, and that plaintiff also manufactures this type of tractor. The amended bill of complaint alleges, with respect to these tractors, "That the plaintiff's line of tractors now comprises various models, and the entire line of such tractors is exemplified by those known as Model T-20, Model TD-40, Model TA-40, and Model TD-60. The first three models are described in the plaintiff's instruction books, marked `Plaintiff's Exhibits B, C, and D,' which are submitted herewith and made a part of this bill. Model TD-60 is a larger size tractor, now undergoing trial and soon to be placed in production for sale, and the construction of this tractor being shown and illustrated by nineteen photographs, marked `Plaintiff's Exhibit E,' also submitted herewith and made a part of this bill."

The amended bill of complaint further alleges the receipt of a letter from the defendant, by which defendant charged plaintiff with infringement of certain letters patent belonging to defendant. A copy of said letter is attached to the amended complaint, and the pertinent portions thereof are as follows:

"We recently have had occasion to examine the track type tractors which you have brought out subsequently to those recently held * * * to be infringements of a number of our patents. Such examination has revealed that your later models of tractors above mentioned contain a large number of inventions developed by us and covered by patents issued to this Company thereon. * * * (List of patents set out.)

"It is our definite purpose with respect to the above appropriations of our inventions * * * to insist upon recognition and enforcement of our rights in the matter.

"We therefore must request that you discontinue the use of our above mentioned inventions and account to us for your past use thereof * * *."

This is followed by an information and belief allegation that defendant's charge of infringement "relates to all the aforesaid tractors" Models T-20, TD-40, TA-40 and TD-60..

As a basis for jurisdiction of the court, the plaintiff alleges that the action arises "* * * from an actual controversy between the plaintiff and the defendant as to the alleged infringement by the plaintiff of rights which defendant claims to possess * * *."

That the letter from the defendant to the plaintiff, above quoted is plaintiff's sole basis for the alleged controversy which plaintiff is asking to have litigated is shown by the further allegation in the amended complaint "That an actual controversy exists between plaintiff and defendant, in that defendant, as hereinbefore set forth, has claimed and is now claiming that plaintiff's tractors, * * * infringe defendant's said letters patent * * *." Emphasis supplied.

Non-infringement is then definitely alleged.

Except for a minor matter later herein to be considered, defendant raises no question on this appeal from the judgment on the pleadings decreeing non-infringement except as it relates to Model TD-60. Defendant maintains there is no "controversy" as to this model tractor. Of course it is definitely settled that in order to come within the declaratory judgment statute there must be an actual controversy as distinguished from a prayer for an opinion advising what the law would be upon a hypothetical state of facts. Aetna Life Ins. Co. v. Haworth, 300 U.S. 227, 240, 241, 57 S.Ct. 461, 81 L.Ed. 617, 108 A.L.R. 1000.

It is defendant's contention that the amended complaint fails to state facts sufficient to establish the existence of a "controversy" as to Model TD-60, that the letter by its terms does not include this model, and that the allegation of the amended complaint wherein it is stated that this model is undergoing tests and will soon be produced for sale negatives the existence of any such controversy.

Consistent too with this position, defendant urges that the complaint shows on its face that notice of infringement was never given plaintiff by defendant as to Model TD-60.

Defendant's argument is, and in this we agree, that an actual controversy is not involved where a person merely apprehends or fears assertion of rights against him by another. 1 C.J.S., Actions, § 18, subd. 9, pages 1030, 1031; Borchard on Declaratory Judgments (1934), pp. 36-40. Therefore, as defendant argues (but here we do not follow) since the letter is the sole basis for the alleged controversy and since such letter read with plaintiff's allegations as to Model TD-60 excludes such model from any alleged controversy there is in fact no alleged "controversy."

The letter constituting the charge of infringement, above quoted, refers to "the track type tractors which you plaintiff have brought out." The complaint affirmatively states that Model TD-60 was one of plaintiff's present line of tractors and that it, with the others mentioned, exemplified their line of tractors, and that it, TD-60, was "undergoing trial and soon to be placed in production for sale." This is followed as we have seen by the allegation that defendant's charge of infringement relates to all four models of tractors including TD-60.

Defendant urges that the words of the letter "which you have brought out" of necessity excluded from the charge, Model TD-60, which was "undergoing trial and soon to be placed in production for sale."

The following definitions of the words "to bring out" are contained in the dictionaries cited below:

"To bring out. To set forth; introduce, as a young woman into society, or a foreign loan for subscription. 2. To publish, as a new book. 3. To produce, as a play, on the stage. 4. To expose; elicit the truth of. 5. To develop." Funk and Wagnalls Co. New Standard Dictionary of the English Language, 1927 edition.

"To bring out. To cause to come out, as from concealment; specifically a. To bring forth, as young. b. To set forth, as in words. c. To detect; expose; make manifest; display to advantage. d. To establish clearly; to demonstrate. e. To set forth for public attention or participation; as to bring out a book, a play, or a loan for public subscription; also to introduce socially. f. To call forth or attract; as, a spectacle brings out a crowd. g. To draw (one) out, as in conversation. h. To publish, as a magazine or an edition." Webster's New International Dictionary, Second Edition, Unabridged, 1935 edition.

From a consideration of the variations of meaning that may be given this indefinite phrase, "which you have brought out," modified as it is by the explanation that Model TD-60 is a fully constructed tractor undergoing trial and soon to be placed in production for sale, we have come to the conclusion that we would be unwarranted in determining as a matter of law that Model TD-60 was not included in the notice charging infringement. The amended complaint refers to nineteen photographs attached as an exhibit for a further description of Model TD-60. Some of these photographs are of portions of the machine, showing details of construction; others show an apparently completed tractor. We are of the opinion, as also was the trial judge, that the amended complaint described Model TD-60 as a machine that had been manufactured, notwithstanding its kind had not as yet been produced in quantity for sale. We are convinced that the letter can be held to necessarily exclude Model TD-60 only through giving the term "brought out" an unreasonably restricted meaning which we decline to do.

Defendant next...