Friedman v. Washburn Co.
| Citation | 145 F.2d 715 |
| Decision Date | 01 December 1944 |
| Docket Number | No. 8501.,8501. |
| Parties | FRIEDMAN v. WASHBURN CO. |
| Court | United States Courts of Appeals. United States Court of Appeals (7th Circuit) |
Harold R. Nettles, of Freeport, Ill., and Maxwell E. Sparrow, of New York City, for appellant.
Andrew F. Wintercorn, of Rockford, Ill., and Irvin H. Fathchild, of Chicago, Ill., for appellee.
Before EVANS, SPARKS, and MINTON, Circuit Judges.
Plaintiff appeals from an order granting defendant's motion for judgment on the pleadings and dismissing his complaint. By his action he sought to have defendant declared a trustee ex maleficio of a certain patent, for assignment of that patent, for an accounting and damages for its alleged misappropriation, and for other relief.
The pleadings on which the judgment was entered consisted of an amended complaint and the answer thereto. Defendant attached to his motion for judgment a number of exhibits, and filed therewith a stipulation of facts entered into pursuant to pre-trial conference order.
Jurisdiction was asserted by the bill of complaint to depend on diversity of citizenship, the requisite amount of over $3,000 being in controversy, and the provisions of the Declaratory Judgment Act, 28 U.S.C.A. § 400. By his amended bill appellant alleged that both parties were engaged in the business of manufacturing and selling various articles including household strainers; that he had invented a new type of such strainer, consisting of a metal bowl and a plastic handle with a ring portion to which the bowl was united by compression under heat. He alleged that he had disclosed his invention to appellee, including his method of carrying it out, submitting certain drawings and models including a preformed thermoplastic handle having a grooved ring portion adapted to receive a stainer bowl, and offered to sell an interest in it, with the understanding that the disclosure was to be kept confidential if the offer were not accepted; that appellee had never, prior to the disclosure, manufactured or used a preformed thermoplastic handle with a grooved portion adapted to receive a strainer, and that appellant was the first to disclose this to it. Notwithstanding the fact that this invention was the property of appellant, and that it was confidentially disclosed to appellee, appellant alleged that appellee wrongfully appropriated the invention and thereafter fraudulently caused the filing of an application by one of its employees for a patent covering the invention, which patent was subsequently assigned to itself, and which it has since 1939 used for the manufacture of strainers. Appellant further alleged that he was barred from securing a patent covering his invention by the wrongful conduct of appellee, and that as a result of appellee's use of the patent it wrongfully obtained, it is receiving large profits which rightly belong to himself.
As a second cause of action, appellant further alleged that prior to February 1938, he had conceived and invented improvements in three types of strainers, one of which embodied a metallic bowl removably secured to the ring portion of a preformed thermoplastic handle, a second, with the bowl permanently attached to the thermoplastic handle, and the third, with the bowl permanently secured to a preformed metallic handle. He alleged that he made complete and workable disclosures of all these improvements to appellee; that the first was the subject of a pending application which matured into a patent issued to him; and that he also showed how the same bowl and thermoplastic ring and handle could be employed for the second improvement; that appellee's officer in control of the business requested that he leave all the devices, drawings, and a copy of the patent application for their consideration in working out an arrangement either on a royalty or outright purchase basis; that later he was induced to discontinue exploitation of his second improvement (attaching as an exhibit the letter of the officer relied upon to show discouragement of this idea); that appellee surreptitiously obtained from him the methods and means of producing thermoplastic handles with grooved ring portions, drawings thereof, places where they might be manufactured, samples of his handles, and concealed from him that it was preparing for production of the strainer embodying his ideas for its own benefit, and that it was preparing an application for a patent embodying his conception, which patent was later obtained by its employee, Williams, May 6, 1941. In support of the allegations of the bill of complaint, appellant attached as exhibits photographs of its models, drawings, letters pertaining to their business relations, and a copy of the Williams patent.
Appellant asked that appellee be declared a trustee ex maleficio of the Williams patent and all others covering this invention or related thereto; that appellee be enjoined from the use of the invention and from manufacturing or selling utensils involving the appellant's invention, and from assigning or granting licenses under the patent other than to appellant's nominees; that appellee be directed to assign the patent to appellant; for an accounting of all profits from the use of it and for damages; and other relief.
For answer appellee set up numerous defenses: Failure to state a claim; general denial of all allegations of misconduct; denial of any confidential disclosure or fiduciary relationship between the parties; denial that the subject matter of the Williams patent was in any way involved in the disclosures and asserting that that patent was independently conceived and developed; averment that the only disclosure made to it was substantially what was claimed in the Friedman patent, whereas what appellant alleged was disclosed involved nothing novel or patentable over the prior art, specifying twelve patents alleged to anticipate appellant's alleged invention. Appellee also averred general notice of its patent rights under Williams from the middle of 1939.
After pre-trial conference and the filing of a stipulation of facts, appellee filed its motion for judgment on the pleadings, setting up various grounds therefor, raising both factual and legal issues: Contravention of the patent laws; absence of power in the Federal Court to grant the relief prayed; negligence and inexcusable delay showing on the face of the complaint; estoppel; lack of elements of a confidential disclosure action. Appellee also asserted that the action did not fall within the provisions of the Declaratory Judgment Act.
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