Krentler-Arnold Hinge Last Co. v. Leman

• Citation: 50 F.2d 699
• Decision Date: 29 June 1931
• Docket Number: No. 2525.,2525.
• Parties: KRENTLER-ARNOLD HINGE LAST CO. v. LEMAN et al.
• Court: U.S. Court of Appeals — First Circuit

50 F.2d 699 (1931)

KRENTLER-ARNOLD HINGE LAST CO. v. LEMAN et al.

No. 2525.

Circuit Court of Appeals, First Circuit.

March 10, 1931.

On Rehearing June 29, 1931.

Robert Cushman, of Boston, Mass., and P. R. Pocock, of Detroit, Mich. (Otto Barthel, of Detroit, Mich., on the brief), for appellant.

Ellis Spear, Jr., of Boston, Mass. (Eiffel B. Gale and Edward N. Goding, both of Boston, Mass., on the brief), for appellees.

Before BINGHAM, ANDERSON, and WILSON, Circuit Judges.

BINGHAM, Circuit Judge.

This is an appeal from a final decree of the District Court for Massachusetts of August 20, 1930, on a petition and motion to show cause why the Krentler-Arnold Hinge Last Company should not be held in contempt for the violation of a permanent injunction issued against it by the District Court November 26, 1926, in an equity suit there brought by the Krentler-Arnold Company against J. Howard Leman, administrator, and the George E. Belcher Company, defendants-counterclaimants, in which injunction it was provided that the Krentler-Arnold Hinge Last Company "shall not, directly or indirectly, make or cause to be made, use or cause to be used, sell or cause to be sold lasts embodying or containing the invention covered by claims 1, 2, 3, 4, 6 and 7 of Letters Patent of the United States No. 1,195,266, issued August 22, 1916, to Otto A. Peterson, and any substantial or material part thereof, or any substantial equivalent or colorable imitation thereof." The Peterson patent is the property of the complainants in the contempt proceedings, who are the counterclaimants in the equity suit.

In these contempt proceedings, by interlocutory decree of September 23, 1929, the Krentler-Arnold Company was found guilty of civil contempt; that the complainants were entitled to equitable relief and should recover, by way of an award, the profits made by the Krentler-Arnold Company in violating the injunction; and that the respondent also should pay the complainants a further sum sufficient to compensate them for their expenses in these contempt proceedings, including the complainants' counsel fees and the usual costs; and a reference to a master for the purpose of determining these matters was ordered.

In the final decree, the master having reported, after repeating the findings made in the interlocutory decree, it was decreed that the complainants recover for infringement of the Peterson patent the sum of $39,576.26, being the profits made by the Krentler-Arnold Company from the sale of its infringing device; also $6,102.72 as counsel fees for services rendered from October, 1928, to the end of April, 1930, in the prosecution of the contempt proceedings; also $389.15 for expenses; amounting in all to $46,068.13, with interest thereon from June 4, 1929 (the date of the filing the contempt proceedings) to the date of the entry of final decree (August 20, 1930) at the rate of 6 per centum per annum, amounting to $3,224.76, and making the total sum payable $49,292.89.

The Krentler-Arnold Company is a Michigan corporation, having its place of business at Detroit, Mich. It manufactures hinges for shoe lasts and sells them to the manufacturers of shoe lasts, who sell the lasts to the shoe manufacturers. It has no place of business in Massachusetts; it manufactures its hinges or links in Detroit, and, so far as appears in these contempt proceedings, has committed no acts of infringement in Massachusetts.

The Belcher Company is a Massachusetts corporation and Leman, administrator, is a citizen of that state. The Belcher Company is a manufacturer of shoe lasts, and makes and uses its own hinges under the Peterson patent No. 1,195,266. There is no direct competition between the two companies.

The final decree in the equity suit was entered March 1, 1928. The term of court at which this decree was entered ended later in the same month. The petition and motion for order to show cause in the contempt proceedings were filed in the equity suit June 4, 1929, and the order to show cause was entered on the same day. The service directed and the only service that could be had in the Massachusetts district was by sending copies of the petition, the motion to show cause, and the order to show cause, together with the supporting affidavits of one Smith and one Southworth, by registered mail to the Krentler-Arnold Company at Detroit, and by serving the same papers upon James R. Hodder at Boston, who had been the attorney for the Krentler-Arnold Company in the equity suit. At the time of the service on Mr. Hodder his name appeared on the record in the equity suit as counsel and at that time had not been withdrawn, if that was necessary to render the purported service upon him of no avail.

On or before the 15th day of July, 1929, the date set for the hearing on the petition for contempt, Mr. Cushman entered a special appearance for the Krentler-Arnold Company for the sole purpose of objecting to the jurisdiction of the court, and filed a motion to dismiss the contempt proceedings for lack of jurisdiction. This motion was overruled, subject to exception. Without waiving the objection to the jurisdiction, the petition for contempt was then heard on the supporting affidavits of the complainants, counter affidavits of the Krentler-Arnold Company, and reply affidavits of the complainants, resulting in the decree of August 20, 1930, above spoken of.

The contempt proceedings, filed in the equity case, were entitled as of that case, and, while they asked for punitive as well as remedial relief, the proceedings were treated by counsel for the respective parties and by the court as only asking for remedial relief. In other words, the allegations and prayer for punitive relief were disregarded and treated as surplusage. And the court, in its final decree, awarded nothing in the way of a penalty, but only by way of remedial relief. The contempt proceedings, therefore, are to be regarded and treated as proceedings in civil contempt, for such was the mutual understanding of the parties throughout the trial. Kreplik v. Couch Patents Co. (C. C. A.) 190 F. 565; Mitchell v. Dexter (C. C. A.) 244 F. 926.

Although the proceedings for contempt were civil in nature and were entitled and filed in the equity suit, the Krentler-Arnold Company contends: (1) That inasmuch as the infringing device here complained of is not the same article held to have infringed the Peterson patent in the equity suit, and the term had expired at which the decree in that suit was entered, and the damages and profits awarded by that decree had been satisfied, an independent suit in equity and a reinvestigation and consideration of the scope and vitality of the claims of the Peterson patent were necessary to determine whether the present device, a so-called sliding hinge, infringed; and that this properly could not be done in a proceeding for civil contempt. The reason underlying this contention apparently is that, if a new and independent suit in equity were necessary, it would have to be brought in the District of Michigan, where the Krentler-Arnold Company is incorporated and does business, for there alone could personal service be had upon that company.

Its second contention is that, if proceedings for civil contempt are, under the circumstances of this case, proper, the District Court was without jurisdiction to entertain the same, as no personal service thereof was had on the Krentler-Arnold Company in the District of Massachusetts; that, the term of court at which the final decree in the equity suit was entered having expired, and the decree, so far as it awarded compensation, having been satisfied, the power of the District Court over that decree had ceased, the parties had been discharged, and the court had no jurisdiction over the Krentler-Arnold Company, in the absence of personal service upon it within the District of Massachusetts.

As to the first contention, it seems to be fairly clear from the decided cases that "whether or not the different structure made by the defendant the Krentler-Arnold Company after being enjoined according to said final decree also infringed said patent the Peterson patent was a question with which the District Court might deal according to various methods, either of which it was at liberty to select in its discretion" (National Metal Molding Co. v. Tubular Woven Fabric Co. C. C. A. 239 F. 907, 908); and that, if the court below regarded it as "really a doubtful question" whether the new device or structure was an infringement or not of the claims of the Peterson patent, the infringement of which was enjoined in the equity suit, it could, in its discretion, have directed that the complainants bring a new suit in equity against the Krentler-Arnold Company for the alleged infringement (California Artificial Stone Paving Co. v. Molitor, 113 U. S. 609, 618, 5 S. Ct. 618, 28 L. Ed. 1106). On the other hand, if it regarded the new structure as a clear infringement of the claims of the Peterson patent, the infringement of which was enjoined, or merely a colorable departure therefrom, it could, in its discretion, direct the parties to proceed in the contempt proceedings already brought. Kreplik v. Couch Patents Co. (C. C. A.) 190 F. 565.

In this case the District Court adopted the latter alternative. The hearing was had, as above pointed out, on affidavits. But before the trial began the Krentler-Arnold Company, in addition to presenting its case on affidavits, was given the opportunity "to put in expert evidence," but declined to do so, stating that "it preferred to proceed on the present contempt record if we proceed on the contempt order," meaning on the affidavits filed in the contempt proceedings.

In its affidavits the Krentler-Arnold Company set up a number of patents as anticipations of the Peterson patent, including therein patent No. 1,094,153, issued April 21, 1914, to W. A. Krentler, which it had previously set up as an anticipation of the...