Chicago Metallic Mfg. Co. v. Edward Katzinger Co.
| Citation | 123 F.2d 518 |
| Decision Date | 12 November 1941 |
| Docket Number | No. 7716.,7716. |
| Parties | CHICAGO METALLIC MFG. CO. v. EDWARD KATZINGER CO. |
| Court | U.S. Court of Appeals — Seventh Circuit |
Ephriam Banning and Laurence I. Wood, both of Chicago, Ill., for appellant.
M. A. Hirschl. Jacob X. Schwartz, and Louis A. Kohn, all of Chicago, Ill., for appellee.
Before SPARKS and KERNER, Circuit Judges, and LINDLEY, District Judge.
By this appeal plaintiff seeks reversal of a judgment dismissing its complaint for a declaratory judgment.
Plaintiff set out in its complaint that it and the defendant were Illinois corporations having their principal offices and places of business in Chicago, Illinois; that plaintiff was engaged in the business of manufacturing and selling tinware made up into various appliances, all free and clear of patent rights belonging to others; that it had operated under a certain license agreement with defendant and had complied with all its terms including the payment of all royalty payments due thereunder on account of the manufacture and sale of "Bakerex"; that it subsequently cancelled the license agreement and discontinued the manufacture of Bakerex, and thereafter manufactured and sold a tinware known as "Bake-King," free and clear of any and all of defendant's patents; that nevertheless defendant demanded that plaintiff pay royalties thereon, as though such Bake-King tinware were being made and sold under the aforesaid license agreement; that jurisdiction rested on the Declaratory Judgment Act, 28 U.S.C.A. § 400, and on the fact that rights under certain specified patents were involved; that an actual controversy exists between plaintiff and defendant with respect to the specified patents as to whether plaintiff's Bake-King tinware is responsive thereto and in any way an infringement thereof, and, in particular, whether there is any validity to Jackson's patent No. 2,077,757 so as to justify the payments of any royalties thereon.
The relief prayed was that there be entered a declaratory judgment that the Jackson patent was invalid and that plaintiff's Bake-King tinware was not responsive to, nor an infringement of, any or all of the defendant's Letters Patent.
In support of the order of dismissal defendant insists that the controversy raises no question of patent law and involves only the construction of a contract. In other words, the court was without jurisdiction, because, there being no diversity of citizenship, no federal question was involved.
It is well to remember that the motion to dismiss is the equivalent of a demurrer and that the court must accept as true all the allegations of the complaint and upon that basis determine whether the complaint presents a cause of action under the Declaratory Judgment Act. The complaint alleged that the license agreement was terminated and cancelled; that plaintiff discontinued the manufacture of the product covered by defendant's patents and thereafter manufactured another product free and clear of defendant's patents and that the defendant claimed the plaintiff's line of tinware came within the defendant's patents. These facts must be taken as true. That being so, whether plaintiff infringes defendant's patents is an actual controversy. It is definite and concrete, and touches the legal relations of parties having adverse legal interests. Aetna Life Ins. Co. v. Haworth, 300 U.S. 227, 240, 57 S.Ct. 461, 81 L.Ed. 617, 108 A.L.R. 1000, and such a dispute is one arising under the patent laws requiring an adjudication of present rights of the parties. Edelmann & Co. v. Triple-A Specialty Co., 7 Cir., 88 F.2d 852; E. W. Bliss Co. v. Cold Metal Process Co., 6 Cir., 102 F.2d 105; Caterpillar Tractor Co. v. International Harvester Co., 9 Cir., 106 F. 2d 769; Lances v. Letz, 2 Cir., 115 F.2d 916; and Creamery Package Mfg. Co., v. Cherry-Burrell Corp., 3 Cir., 115 F.2d 980.
Defendant also insists that...
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