Excelsior Steel Furnace Co. v. F. Meyer & Bro. Co.

• Decision Date: 17 December 1929
• Docket Number: No. 4222.,4222.
• Parties: EXCELSIOR STEEL FURNACE CO. v. F. MEYER & BRO. CO.
• Court: U.S. Court of Appeals — Seventh Circuit

36 F.2d 447 (1929)

EXCELSIOR STEEL FURNACE CO. v. F. MEYER & BRO. CO.

No. 4222.

Circuit Court of Appeals, Seventh Circuit.

December 17, 1929.

Benjamin T. Roodhouse and John A. Brown, both of Chicago, Ill., for appellant.

Arthur L. Morsell, of Milwaukee, Wis., for appellee.

Before ALSCHULER, EVANS, and PAGE, Circuit Judges.

EVAN A. EVANS, Circuit Judge.

Appellant's suit was to secure protection for its patent No. 724,210 bearing date March 31, 1903, covering "Improvements in Hot Air Pipe." The District Court found the patent invalid, and dismissed the bill. On appeal this court on April 10, 1917 (244 F. 172) reversed the decree, sustained three claims of the patent, but agreed with the district court that two of the claims (1 and 2) were invalid.

Thereafter the District Court entered an interlocutory decree enjoining appellee from infringing claims 3, 4, and 5, and ordered a reference to ascertain the plaintiff's damages. Upon the master's report, the court ordered the bill dismissed for want of equity.

The questions here presented are: (a) The effect of appellant's failure to file a disclaimer of claims 1 and 2 before the patent expired; (b) the amount of appellee's profits; (c) the amount of appellant's damages; (d) the proper disposition of costs and sums paid to the certified accountant appointed by the court upon appellant's motion. A further statement of the facts will appear under the appropriate headings.

Disclaimer. — At the close of plaintiff's testimony before the master, appellees moved that appellant be denied all relief because of its failure to file a written disclaimer of the two claims (1 and 2) held invalid by this court. The master recommended the disallowance of all damages and costs, finding that "appellant has neglected and delayed for an unreasonable time to file a disclaimer after claims one and two had been held invalid."

The rehearing in this court on this previous appeal was denied May 17, 1917. The patent expired March 31, 1920. Appellant closed its testimony before the master on February 25, 1922. On the same day appellee made its request to the master to deny appellant all damages because of its failure to disclaim claims 1 and 2. Appellant then asked leave to file a disclaimer nunc pro tunc as of May 17, 1917. The request was denied. Thereupon appellant, on March 17, 1922, almost two years after the patent had expired, filed a disclaimer. The master later reported the delay in filing the disclaimer was unreasonable. The court sustained the master.

The rights of the parties are determined by two sections of the statute. USCA title 35, § 71 (R. S. § 4922), and USCA title 35, § 65 (R. S. § 4917), read as follows:

"Section 65. Disclaimer. Whenever, through inadvertence, accident, or mistake, and without any fraudulent or deceptive intention, a patentee has claimed more than that of which he was the original or first inventor or discoverer, his patent shall be valid for all that part which is truly and justly his own, provided the same is a material or substantial part of the thing patented; and any such patentee, his heirs or assigns, whether of the whole or any sectional interest therein, may, on payment of the fee required by law, make disclaimer of such parts of the thing patented as he shall not choose to claim or to hold by virtue of the patent or assignment, stating therein the extent of his interest in such patent. Such disclaimer shall be in writing, attested by one or more witnesses, and recorded in the Patent Office; and it shall thereafter be considered as part of the original specification to the extent of the interest possessed by the claimant and by those claiming under him after the record thereof. But no such disclaimer shall affect any action pending at the time of its being filed, except so far as may relate to the question of unreasonable neglect or delay in filing it."

"Section 71. Suit for Infringement where Specification too Broad. Whenever, through inadvertence, accident, or mistake, and without any willful default or intent to defraud or mislead the public, a patentee has, in his specification, claimed to be the original and first inventor or discoverer of any material or substantial part of the thing patented, of which he was not the original and first inventor or discoverer, every such patentee, his executors, administrators, and assigns, whether of the whole or any sectional interest in the patent, may maintain a suit at law or in equity, for the infringement of any part thereof, which was bona fide his own, if it is a material and substantial part of the thing patented, and definitely distinguishable from the parts claimed without right, notwithstanding the specifications may embrace more than that of which the patentee was the first inventor or discoverer. But in every such case in which a judgment or decree shall be rendered for the plaintiff no costs shall be recovered unless the proper disclaimer has been entered at the Patent Office before the commencement of the suit. But no patentee shall be entitled to the benefits of this section if he has unreasonably neglected or delayed to enter a disclaimer."

The vital questions in view of these statutes are: (a) What is a reasonable time within which the owner of a patent must, when necessary, file a disclaimer? (b) What are the consequences of a failure to seasonably file such disclaimer?

(a) Appellee asserts, and the court sustained its contention, that all relief must be denied because appellant "unreasonably neglected or delayed to enter a disclaimer."

What is an unreasonable delay?

Appellee answers, "More than ninety days from the date of the denial of the petition for a rehearing (May 17, 1917)," and to support its answer cites Liquid Carbonic Company v. Gilchrist Company (C. C. A.) 253 F. 58; Herman v. Youngstown Manufacturing Company (C. C. A.) 191 F. 587.

The Liquid Carbonic Company v. Gilchrist Company decision, by this court, is distinguishable in at least two respects: (1) In that case the Court of Appeals definitely fixed the period within which the patentee was required to file a disclaimer. In the instant suit the Court of Appeals, in reversing the decree and ordering an injunction and an accounting, fixed no period within which a disclaimer was to be filed. There is an inference, at least, to be drawn from the direction of a decree in favor of the patentee that up to this time, at least, there had been no such delay as would bar the granting of the usual relief.

(2) In the present suit the patentee resisted the contention that...