Cleveland Engineering Co. v. Galion Dynamic Motor Truck Co.

• Decision Date: 11 June 1917
• Docket Number: 394.
• Citation: 243 F. 405
• Parties: CLEVELAND ENGINEERING CO. v. GALION DYNAMIC MOTOR TRUCK CO.
• Court: U.S. District Court — Northern District of Ohio

243 F. 405

CLEVELAND ENGINEERING CO. v. GALION DYNAMIC MOTOR TRUCK CO.

No. 394.

United States District Court, N.D. Ohio, Eastern Division.

June 11, 1917

Hull Smith, Brock & West, of Cleveland, Ohio, for plaintiff.

W. J Geer, of Galion, Ohio, and Harry Frease, of Canton, Ohio, for defendant.

WESTENHAVER District Judge.

Complainant's bill sets up two patents, one No. 894,752, and the other No 1,155,315, which it is charged the defendant is infringing. The answer denies that complainant has title to either of said patents, and as to the second patent asserts that it is the equitable owner thereof and entitled to a decree quieting its title, and requiring an assignment to it of the legal title. The answer also challenges the validity of both patents, because of anticipation and on other grounds.

This cause is now before me on complainant's motion to require defendant to specify, as to patent No. 1,155,315, which of two defenses, said to be incompatible or inconsistent, it will rely upon; also to require from defendant further and better particulars of certain matters in its answer, not now necessary to be stated; and also to strike from the answer defendant's counterclaim. The two defenses said to be incompatible or inconsistent, as to which an election is desired, are: First, complainant's want of title and defendant's ownership as to patent No. 1,155,315; and, second, invalidity of said patent.

I am of opinion that this motion should be denied. Both defenses are and should be available to the defendant. Both of them may be true, or the defendant may own the patent, and the patent may be invalid. It cannot rely on either defense alone, without risking an entire loss of the other; or, if the defense of defendant's ownership is not lost, the result would be to require another action to settle finally the controversy now in court. Furthermore, even if these defenses are inconsistent, new equity rule 30 permits inconsistent defenses. It says: 'The answer may state as many defenses, in the alternative, regardless of consistency, as the defendant deems essential to his defense.'

Moreover, even without the aid of this rule, an election should not be required because of the supposed inconsistency. In Dick v. Hyer, 114 N.E. 251, a decision of the Supreme Court of Ohio (see Ohio Law Reporter, January 1, 1917, 94 Ohio St. 351), it is held error to require an election between two causes of action permitting of only one recovery, when the first cause of action is based on a promissory note to which the defense was that it had been altered, and the second cause of action was upon the original indebtedness for which the altered note had been given. In Railway Co. v. Hedges, 41 Ohio St. 233, an election was not required when plaintiff sued to recover damages for horses killed by defendant's train, based on two distinct wrongful acts: First, neglect to keep in repair a fence as required by contract; and, second, negligence in operating the train. On principle, these cases cover the situation here presented.

Complainant's remedy in this situation is to ask a separate trial of the issues relating to the title to this patent. This is within the power of a court of equity, and is specially authorized by new equity rules 26 (201 F. v. 118 C.C.A. v) and 29 (198 F. xxvi, 115 C.C.A. xxvi). Indeed, at the hearing, counsel for both parties joined in a request for a separate trial of such issues in the event the motion to elect and strike out defendant's counterclaim was overruled. In my opinion, the motion to strike out the counterclaim should be denied. A statement at length of the facts therein alleged is not necessary. It is sufficient to say that defendant asserts a good equitable title to patent No. 1,155,315, and prays that this title may be quieted against complainant's demands, and that a conveyance from complainant to defendant of the legal title may be ordered. The origin of defendant's claim of title, it is alleged, is in part based on representations by persons for whose acts complainant was then and is now responsible, that the inventions covered by this patent were owned by a corporation and were being sold by it to another corporation, to whose right and title the defendant has since succeeded.

The motion to strike out is based on the supposed ground that this court has no jurisdiction of this counterclaim, because complainant and defendant are citizens of the same state, and the subject-matter thereof is not within any independent ground of federal jurisdiction. The cases cited and relied upon by complainant were examined and reviewed by me on motion to strike out a counterclaim in Ohio Brass Company v. Hartman Electrical Manufacturing Company, No. 373. In passing on that motion I filed an opinion, which is accessible to counsel, and I shall not, therefore, review those cases at length.

It is true that a set-off or counterclaim which is the subject of an independent suit in equity cannot be sustained, unless some independent ground of federal jurisdiction is shown to support it. The jurisdiction of the court invoked by complainant in its bill, and shown by the allegations thereof, does not aid or support the jurisdiction of this court when the defendant brings forward a set-off or counterclaim which may be the subject of an independent suit, and which does not merely concern matters already put in litigation by the original bill. It follows, therefore, in that situation, if there is not diversity of citizenship, or if the subject-matter of a counterclaim is not within the jurisdiction of a federal court, the counterclaim should be stricken out for want of jurisdiction. Equity rule 30 (201 F. v, 118 C.C.A. v) could not, even if so intended, enlarge the jurisdiction of a court of equity, or of a federal court. On this proposition I agree with the conclusion reached in the cases cited by counsel: Marconi Wireless Tele. Co. v. National Elec. Signaling Co. (D.C.) 206 F. 295-300; Adamson v. Shaler (D.C.) 208 F. 566; Electric Boat Co. v. Lake Torpedo Boat Co. (D.C.) 215 F. 377; United States Expansion Bolt Co. v. Kroncke Hardware Co. (D.C.) 216 F. 186; United States Expansion Bolt Co. v. Kroncke Hardware Co., 234 F. 868, 148 C.C.A. 466; Geneva Furniture Co. v. S. Karpen, 238 U.S. 254, 35 Sup.Ct. 788, 59 L.Ed. 1295.

The question here, however, is entirely different. The defendant is not presenting a set-off or counterclaim which may be the subject of an independent suit in equity, in the sense in which that expression is used in equity rule 30, or in the cases above cited. The defendant's counterclaim is not really a counterclaim at all; it is a part of its defensive matter, and a determination thereof is necessary in order that complete relief may be given concerning the subject-matter put in litigation by complainant's bill. It is such matter as, according to familiar equity rules might be made the subject of a cross-bill, and the...