Kirk v. Milwaukee Dust Collector Mfg. Co.

• Decision Date: 01 October 1885
• Citation: 26 F. 501
• Court: U.S. District Court — Eastern District of Wisconsin
• Parties: KIRK and others v. MILWAUKEE DUST COLLECTOR MANUF'G CO. [1]

26 F. 501

KIRK and others v. MILWAUKEE DUST COLLECTOR MANUF'G CO. ^[1]

United States Circuit Court, E.D. Wisconsin.

October, 1885

Flanders & Bottum and Quarles & Spence, for plaintiffs.

Cotzhausen Sylvester, Scheiber & Sloan, for defendants.

DYER J.

This is a suit removed from the state court to this court. The prayer of the complaint is that a certain license granted to the defendant by the plaintiffs May 1, 1883, for the manufacture and sale of certain patented machines known as dust collectors, may be decreed to be canceled and annulled on the ground that the defendant has violated certain conditions of the license, and that the defendant may be enjoined from further manufacturing and selling said machines. The answer of the defendant controverts the allegations of the complainant, and, as is permissible under the code practice sets up an equitable counter-claim in which it is asked among other things that the plaintiffs be enjoined, pendente lite from engaging in or resuming the manufacture and sale of the dust collectors covered by the license, and from slandering the title of the defendant acquired by said license, and from committing any acts in violation of the alleged rights of the defendant as licensee.

After issue was thus joined, the state court, on application of the defendant, granted a temporary injunction restraining the plaintiffs 'from engaging in or resuming the manufacture and sale of dust collectors within the United States in so far as exclusive license was vested in the defendant under the agreements mentioned in the pleadings and under the letters patent set forth in the answer, and also from slandering the title of the defendant to manufacture, sell and license dust collecting machines under said letters patent, or in any way questioning or controverting the right of the defendant to manufacture and sell said machines, and from all attempts to divert the good-will and patronage of the defendant to themselves or into other channels. ' This injunctional order was granted June 6, 1885, and, as originally entered, was to remain in force until June 20th. On the twenty-fifth day of June a further order was made continuing the injunction in force until the final hearing of the cause.

Subsequently, and before the removal of the case to this court, it being claimed by the defendant that the plaintiffs were violating the injunction, an order was obtained that the plaintiffs show cause on the first day of September, 1885, why they should not be punished for contempt in disobeying said injunction. This order was served on the plaintiffs Bean and George T. Smith Middlings Purifier Company, and on one Faustin Prinz, who was alleged to be a party to the violation of the injunction. On the first day of September, and before the contempt proceedings were heard by the state court, the case, on the petition of the plaintiffs, was removed to this court under the removal act of March 3, 1875.

An entry in the record indicates that the defendants' counsel sought to have the judge of the state court dispose of the pending application to punish the plaintiffs for contempt, before the transfer of the case to this court was ordered, but he refused to entertain or pass upon the contempt proceeding.

After the case came to this court, on ex parte motion of the defendant, a time was fixed for hearing the application thus made in the state court to punish the plaintiffs for contempt, and a further order to show cause addressed to the plaintiffs Kirk and Fender, similar to that made by the state court, was entered, which, with the affidavits thereto attached, was served upon Kirk, but not upon Fender. As the plaintiffs are all non-residents of the state of Wisconsin, service of the orders to show cause was made upon such of them as were served, out of the state. When this matter came on for hearing, a question in limine arose as to the authority and jurisdiction of this court to entertain the contempt proceeding or to proceed to judgment therein, it appearing that the acts complained of, which constituted the alleged contempt, were committed while the case was pending in the state court and before its removal to this court; it being contended that this court did not, by virtue of the removal of the principal case, acquire authority to punish the plaintiffs for their alleged disobedience, before the removal, of the injunctional order of the state court. The court directed this question to be orally argued at the bar, and after very able arguments on both sides, this is the question to be now decided.

A section of the state statutes (Rev. St. Wis. Sec. 2565, c. 117) provides that every court of record shall have power to punish, as for a criminal contempt, persons guilty, among other things, either of disorderly, contemptuous, or insolent behaviour committed during its sittings, in its immediate view and presence, and directly tending to interrupt its proceedings, or to impede the respect due its authority, or any breach of the peace, noise, or disturbance directly tending to interrupt its proceedings, or willful disobedience of any process or order lawfully issued or made by it, or resistance willfully offered by any person to the lawful order or process of the court. And the same statute provides that any such contempt shall be punished by fine not exceeding $250, or imprisonment not exceeding 30 days, or both. Another enactment in the same Revision (Rev. St. Wis. c. 150) entitled 'of proceedings to punish contempts to protect the rights of parties in civil actions,' provides that 'every court of record shall have power to punish by fine and imprisonment, or either, any neglect or violation of duty, or any misconduct, by which the rights or remedies of a party in an action or proceeding depending in such court * * * may be defeated, impaired, impeded, or prejudiced, in the following cases;' one of which enumerated cases is that of 'parties to actions * * * and all other persons * * * for any * * * disobedience to any lawful order, judgment, or process of such court,' and 'all other cases where attachments and proceedings as for contempt have been usually adopted and practiced in courts of record, to enforce the civil remedies of any party, or to protect the rights of any such party. ' Section 3490 of this chapter provides that 'if an actual loss or injury has been produced to any party by the misconduct alleged, the court shall order a sufficient sum to be paid by the defendant to such party to indemnify him and to satisfy his costs and expenses, instead of imposing a fine upon such defendant. * * * Where no such actual loss or injury has been produced, the find shall not exceed two hundred and fifty dollars over and above the costs and expenses of the proceedings, and in no case can the imprisonment exceed six months.'

The power of the federal courts to punish for contempts is derived from section 725 of the Revised Statutes of the United States, which provides that 'the said courts shall have power * * * to punish by fine and imprisonment, at the discretion of the court, contempts of their authority: provided, that such power to punish contempts shall not be construed to extend to any cases except the misbehavior of any person in their presence, or so near thereto as to obstruct the administration of justice, the misbehavior of any of the officers of said courts in their official transactions, and the disobedience or resistance by any such officer, or by any party, juror, witness, or other person, to any lawful writ, process, order, rule, decree, or command of the said courts.'

The last clause in section 4 of the removal act of March 3, 1875, provides that 'all injunctions, orders, and other proceedings had in such suit prior to its removal shall remain in full force and effect until dissolved or modified by the court to which such suit shall be removed. ' And section 6 of the same act provides that 'the circuit court of the United States shall, in all suits removed under the provisions of this act, proceed therein as if the suit had been originally commenced in said circuit court, and the same proceedings had been taken in such suit in said circuit court as shall have been had therein in said state court prior to its removal.'

Before considering what effect is to be given to these provisions of the act of March 3, 1875, it is to be observed that the state statutes, as we have seen, provide either for the punishment of a party who disobeys a lawful order of the court as a criminal contempt, or for punishment in the form of pecuniary indemnity to the party injured by the misconduct which constitutes the contempt; and in the latter class of cases the punishment may indirectly tend to promote the rights and advance the remedies of the party to the action thus injured. The sole power of the federal courts to punish for contempts of its authority both at law and in equity is derived from section 725 of the Revised Statutes. It was argued by the senior counsel for the defendant that such power was inherent in a court of equity, and not dependent upon the statutory provision on the subject; and in his discussion of the question he made a clear and forcible statement of the powers of a court of equity as those powers were originally exercised. But it will be observed that while the statute of the United States is in a certain sense declaratory of an inherent power in the federal courts to punish for contempts, it is restrictive and limits the exercise of that power to certain well-defined classes of cases. That it includes the exercise of this power by a court of equity is evident from the use of the words 'order, rule, decree,' and the rules of practice for the courts of equity bearing upon this question, and...