Kelly v. the Kelly Scroll Mfg. Co.

• Court: Appellate Court of Illinois
• Writing for the Court: BAILEY, J.
• Citation: Kelly v. the Kelly Scroll Mfg. Co., 15 Ill.App. 547, 15 Bradw. 547 (Ill. App. 1884)
• Decision Date: 31 October 1884
• Parties: GEORGE KELLY ET AL.v.THE KELLY SCROLL MFG. CO.

15 Ill.App. 547

15 Bradw. 547

GEORGE KELLY ET AL.

v.THE KELLY SCROLL MFG. CO.

Appellate Court of Illinois, First District.

October Term, 1884.

OPINION TEXT STARTS HERE

APPEAL from the Superior Court of Cook county; the Hon. HENRY M. SHEPARD, Judge, presiding. Opinion filed January 6, 1885.

This was a bill in chancery, brought by the Kelly Scroll Section Manufacturing Company against George Kelly, Henry D. Smalley and the Kelly Covering Company, for an injunction. A preliminary injunction having been awarded, the defendants appeared and filed a demurrer to the bill, which being overruled, the defendants elected to abide by their demurrer, and a decree was thereupon rendered making the injunction perpetual.

The bill alleges that the complainant is a corporation organized under the laws of this State, for the purpose of manufacturing and selling non-conducting and fire proof covering for steam boilers, drums and pipes; that the original subscribers for stock in said corporation were George Kelly, George H. Leonard, Loren Greene and Henry D. Smalley, Smalley and Greene being subscribers for 350 shares each, Kelly for 250 shares and Leonard for 50 shares; said shares being of the par value of $100 each; that at the first meeting of stockholders, said Kelly, Greene, Smalley and Leonard were elected directors for the term of one year from October 7, 1882; that the goods proposed to be manufactured and sold consisted of several kinds of pipe covering of a novel and peculiar design and construction, for which letters patent had been granted to said Kelly; that Kelly at the time was engaged in manufacturing and selling said patented articles in a small way, but was in a crippled financial condition; that he represented to the persons who proposed to organize said corporation, that if he had capital and credit sufficient to advertise said goods and keep a considerable stock on hand, there would be great profit in the business; that after considerable negotiation, the corporation was formed, it being agreed that Kelly should have 250 shares of stock and a considerable sum of money in notes and cash, which was paid him, and also that he should be appointed superintendent of the company's factory, for one year, at a salary of one hundred dollars per month, in pursuance of which agreement he was so appointed and served for one year, and was paid for his services; that in consideration of said stock and money, and of the advantages to be gained by him from said corporation, said Kelly executed and delivered to the corporation the following agreement:

“This agreement, made this 26th day of October, 1882, by and between George Kelly, of the city of Chicago, Cook county, in the State of Illinois, party of the first part, and the Kelly Scroll Section Manufacturing Company, of the same place, party of the second part, witnesseth:

That, whereas, the said George Kelly claims to be the owner and inventor of several valuable inventions of steam pipe covering, and of a fire proof window shutter, and improvements on said several articles, discovered and invented by him, and that he is also the owner of letters patent granted to him on one of such inventions of steam pipe covering by the commissioner of patents of the United States, numbered and bearing date as follows: No. -- and bearing date, --, 1881, and the said second party, desiring to purchase all of said patents and all inventions, for the purpose of manufacturing said patented articles and inventions, and to control the same exclusively. Now, therefore, be it known that I, George Kelly, party of the first part, in consideration of the sum of one hundred thousand dollars to me in hand paid by the said party of the second part, the receipt whereof is hereby confessed and acknowledged, have sold, assigned, transferred and conveyed, and by these presents do hereby sell, assign, transfer and convey, unto the said Kelly Scroll Manufacturing Company, all my right, title and interest in and to all of said inventions and letters patent, except the patent granted to me February 25, 1879, number 212,607. And I do further agree to take all necessary action and use my best endeavors to procure the said several unpatented inventions to be patented by the commissioner of patents of the United States, and such other countries as said second party may require, for the use and benefit of the said Kelly Scroll Section Manufacturing Company exclusively, and any letters patent granted or allowed on either or any of such inventions, shall belong to and be the property of said second party, its successors and assigns, in whosesoever name the same may be allowed or issued.

And I further covenant and agree, that any and all inventions and improvements in steam pipe covering hereafter made and discovered by me, shall belong to and be the property of said second party, its successors and assigns, and I will use my best endeavors to procure the same to be patented for the use and benefit of said second party, the expense of all patents hereafter procured on any of such inventions to be procured at the expense of said company.

In witness whereof I have hereunto set my hand and seal the day and year first above written.

GEORGE KELLY.”

Said agreement was duly acknowledged by said Kelly, and on the 23d day of January, 1883, it was filed and recorded in the United States patent office.

The bill further alleges that, in addition to said general assignment of said...