General Motors Corporation v. Blackmore

• Decision Date: 10 November 1931
• Docket Number: No. 5709.,5709.
• Citation: 53 F.2d 725
• Parties: GENERAL MOTORS CORPORATION v. BLACKMORE et al.
• Court: U.S. Court of Appeals — Sixth Circuit

53 F.2d 725 (1931)

GENERAL MOTORS CORPORATION v. BLACKMORE et al.

No. 5709.

Circuit Court of Appeals, Sixth Circuit.

November 10, 1931.

COPYRIGHT MATERIAL OMITTED

J. M. Zane, of Chicago, Ill. (Harold W. Norman, of Chicago, Ill., and Stevenson, Butzel, Eaman & Long, of Detroit, Mich., on the brief), for appellant.

J. R. Whiting, of Jackson, Mich. (William H. Aubrey, of Jackson, Mich., and Paul R. Dailey and William M. Swan, both of Detroit, Mich., on the brief), for appellees.

Before DENISON, HICKS, and HICKENLOOPER, Circuit Judges.

HICKENLOOPER, Circuit Judge.

Appellees recovered a judgment in the District Court in an action at law founded upon Rev. St. § 4919 (title 35, U. S. C. § 67 35 USCA § 67), for the infringement of patent to Pearson, No. 855970, on side curtain supports for vehicles (the now familiar curtain rod for automobile touring cars). Fifty-six errors are assigned, but in many instances these may be grouped for consideration, since the main contentions of appellant, defendant below, are presented under a variety of exceptions: To the admission of evidence, to the charge, to refusals to charge, etc. The patent involved was sustained by this court in Collins v. Hupp Motor Car Corporation, 22 F.(2d) 27, 30. The present action was filed December 3, 1926. The patent had expired on June 4, 1924, so that the period of alleged infringement lay between December 3, 1920, and June 4, 1924, a period of three and a half years. Rev. St. § 4921, as amended (title 35, U. S. C., § 70 35 USCA § 70). The number of rods used by defendant, which were not purchased from authorized sources, was stipulated to be 1,810,675; and the number of cars so equipped was 486,093.

The first claim of error to be noticed is that the action could not be maintained at law. Prior to the institution of suit, to wit, on May 15, 1924, Charles C. Blackmore, one of the plaintiffs and owner of the patent in suit, had made a settlement with the defendant whereby he assigned to the defendant "all of the right, title and interest to which the assignor is, or shall or may be entitled in and to any claim or demand which he may or could possess against the Assignee * * * by reason of its or their use of the inventions" covered by the Pearson patent, and released and discharged the assignee "from any and all liability and obligation which it or they may or could be under or liable for, either to him or the said Dayton Top Improvement Company of Dayton, Ohio, by reason of the use or employment by it or them * * * of the inventions mentioned in or covered by said Letters Patent." The question is thus squarely presented whether an exclusive licensee may, by joining the owner of a patent, maintain an action at law under Rev. St. § 4919, after such assignment and release has been given by such patent owner.

By two agreements, dated respectively March 23, 1914, and September 11, 1917, Blackmore had constituted the plaintiff Collins his "exclusive agent" to represent him "in all his dealings with the manufacturers of automobiles." By later agreements of June 7, 1923, and September 6, 1923, this exclusive right of representation was transferred to one Paul R. Dailey, therein designated a "trustee and representative." None of these agreements transferred, or purported to transfer, any title to or interest in the patent itself. In Collins v. Hupp Motor Car Corporation, supra, we held that by the first two agreements above referred to Collins acquired "an irrevocable right for the entire remaining life of the Pearson patent — exclusive as against all the world but Blackmore — to the benefit of the patent in dealing with manufacturers of automobiles." The opinion there expressed is here and now reaffirmed. However, as there indicated, the interest of Collins in the patent was a beneficial or equitable interest, not a legal one. Title remained in Blackmore, although, as is sometimes said, he held that title as trustee for the benefit of himself and Collins.

The situation in respect to legal title was unchanged by the agreements of 1923 which specifically recognized the right of Blackmore "to continue to manufacture and sell the curtain fixtures referred to herein, subject to the provisons of this contract with regard to accounting." It is true that, by the contract of June 7, 1923, it was "agreed that neither party Blackmore nor the party Collins will make any settlement for past infringement nor grant any licenses; it is the understanding that these powers have been conferred on the Trustee," but we construe this provision neither as a conveyance of an interest in the patent nor as an assignment of causes of action already accrued. Dailey was merely substituted as "exclusive agent." It was provided that he should act "in the names of the parties Blackmore and Collins." Thus, while this agreement also gave rise to equitable rights as against all having notice, and to contract rights as between the parties, it left the legal title to the patent and the powers of Blackmore incident thereto, at law, unaffected. Waterman v. Mackenzie, 138 U. S. 252, 255, 11 S. Ct. 334, 34 L. Ed. 923; Crown Die & Tool Co. v. Nye Tool & Machine Works, 261 U. S. 24, 37, et seq., 43 S. Ct. 254, 67 L. Ed. 516.

The strict line of demarcation between suits at law and actions in equity has always been preserved by the federal courts. One cannot maintain an action at law against one's self. It follows that an action may not be maintained at law where the person in whose name such action must be brought is himself the infringer (the cause of action being based upon patent), or has assigned his cause of action or given a release to the defendant. This is recognized by those decisions holding that, in any such event, equity will afford relief. Littlefield v. Perry, 21 Wall. 205, 223, 22 L. Ed. 577; Independent Wireless Co. v. Radio Corp., 269 U. S. 459, 472, 473, 46 S. Ct. 166, 70 L. Ed. 357; Wilson v. Chickering, 14 F. 917 (C. C., Mass.). It thus also follows that the case at bar could not be maintained at law — that the court erred in refusing to transfer it to the equity side of the court upon motion of the defendant.

What has already been said also disposes of the contention of the defendant that recovery should be limited to infringement during the period from December 9, 1923, to June 4, 1924. When this action was originally commenced on December 3, 1926, Dailey was not a formal party. It purported to have been brought by Collins and Blackmore. Dailey appeared as "of counsel." By amendment of December 9, 1929, Dailey was added as a party plaintiff, and the agreements of 1923 are cited as the ground for this action. Thereupon the defendant contended that the cause of action had been assigned to Dailey by the 1923 agreements, and that Dailey was therefore a necessary party plaintiff. Thus, it is urged, no valid cause of action was stated in the original declaration and the running of the statute of limitations was not thereby suspended, citing Mellon v. Weiss, 270 U. S. 565, 46 S. Ct. 378, 70 L. Ed. 736, and N. & G. Taylor Company, Inc., v. Anderson, 275 U. S. 431, 48 S. Ct. 144, 72 L. Ed. 354.

The fallacy in defendant's position lies in the contention that the cause of action was assigned to Dailey. As we have said, this is not the case. Dailey was merely made the exclusive agent of both Collins and Blackmore to prosecute suits for infringement in their names. Probably Collins might have brought an action in equity in his own name, since Blackmore had assigned his interest in any recovery to the defendant which had notice of the 1923 agreements; and, while Dailey was a proper party, we do not consider that he was a necessary one. There was no defect in parties plaintiff to the action as originally brought in the names of both Collins and Blackmore. When the assignment and release by Blackmore were pleaded the cause should have been transferred to the equity side, but it would be a continuation of the original cause which the court would then proceed to try in equity. The original filing tolled the running of the statute of limitations, and the contention of defendant is without merit.

It is also insisted that the court erred in not properly submitting to the jury the question of the grant of a license by Blackmore at 5 cents per car. Negotiations for a license had been carried on by both Collins and Blackmore shortly prior to February, 1920, and a license agreement was drawn up and signed by Blackmore....