LAITRAM CORPORATION v. Deepsouth Packing Co.

• Decision Date: 10 March 1970
• Docket Number: Civ. A. No. 67-861.
• Citation: 310 F. Supp. 926
• Parties: The LAITRAM CORPORATION, Plaintiff, v. DEEPSOUTH PACKING CO., Inc., Defendant.
• Court: U.S. District Court — Eastern District of Louisiana

310 F. Supp. 926

The LAITRAM CORPORATION, Plaintiff, v. DEEPSOUTH PACKING CO., Inc., Defendant.

Civ. A. No. 67-861.

United States District Court, E. D. Louisiana, New Orleans Division.

March 10, 1970.

Lewis H. Eslinger, Guy W. Shoup, New York City, Louis B. Claverie, New Orleans, La., for plaintiff.

Harold J. Birch, Washington, D. C., C. Emmett Pugh, New Orleans, La., for defendant.

RUBIN, District Judge:

The defendant, Deepsouth Packing Co., Inc., has requested a modification of the injunction issued on June 30, 1969 to make it clear that it does not prohibit the manufacture and sale of a slitter and deveiner unit in unassembled form for export to a Brazilian customer. The defendant will supply all of the parts necessary for the complete operation of the slitter and deveiner; it will be necessary for the buyer only to assemble the unit after arrival, provide electrical current and water. Assembly will require some mechanical skill. The seller proposes to do the assembly itself in Brazil.

Mr. Justice Black, concurring in part and dissenting in part in Lear, Incorporated v. Adkins, 1969, 395 U.S. 653, 89 S.Ct. 1902, 1914, 23 L.Ed.2d 610, noted, "the national policy expressed in the patent laws, favors free competition and narrowly limits monopoly * * *."

"In rewarding useful invention, the `rights and welfare of the community must be fairly dealt with and effectually guarded.' Kendall v. Winsor, 21 How. 322, 329, 16 L.Ed. 165 (1859). To that end the prerequisites to obtaining a patent are strictly observed, and when the patent has issued the limitations on its exercise are equally strictly enforced. * * * Once the patent issues, it is strictly construed. United States v. Masonite Corp., 316 U.S. 265, 280, 62 S.Ct. 1070, 1078, 86 L.Ed. 1461 (1942), it cannot be used to secure any monopoly beyond that contained in the patent, Morton Salt Co. v. G. S. Suppiger Co., 314 U.S. 488, 492, 62 S.Ct. 402, 405, 86 L.Ed. 363 (1942), the patentee's control over the product when it leaves his hands is sharply limited, see United States v. Univis Lens Co., 316 U.S. 241, 250-252, 62 S.Ct. 1088, 1093-1094, 86 L.Ed. 1408 (1942), and the patent monopoly may not be used in disregard of the antitrust laws, see International Business Machines Corp. v. United States, 298 U.S. 131, 56 S.Ct. 701, 80 L.Ed. 1085 (1936); United Shoe Machinery Corp. v. United States, 258 U.S. 451, 463-464, 42 S.Ct. 363, 367, 66 L.Ed. 708 (1922)." Sears, Roebuck & Co. v. Stiffel Company, 1964, 376 U.S. 225, 230, 84 S.Ct. 784, 788, 11 L.Ed.2d 661.

Every court of appeal that has considered an actual situation in any way resembling the one here proposed has held that the sale of a product for export in unassembled form is not an infringement of the domestic patent. In Radio Corporation of America v. Andrea, 2 Cir. 1935, 79 F.2d 626, 627, the court considered the matter with respect to a combination patent. On a motion for a preliminary injunction, it was shown that the defendants manufactured all of the components of the patented radio receivers exclusive of vacuum tubes. The tubes were purchased by the defendants in the open market. To operate the receiver it was necessary only to insert the vacuum tubes into the sockets provided for them and to connect the receiver by means of a wire and plug provided for that purpose to a source of electrical power, such as the electric lighting system in a private home. The court held that the sale of receiver and vacuum tube separately solely for export was not an infringement and denied the injunction, saying:

"Nor is this conclusion so highly technical as it may at first blush appear. No wrong is done the patentee until the combination is formed. His monopoly does not cover the manufacture or sale of separate elements capable of being, but never actually, associated to form the invention. Only when such association is made is there a direct infringement of his monopoly, and not even then if it is done outside the territory for which the monopoly was granted. This is the basis for the doctrine of contributory infringement, which permits the elements of a patented combination to be sold in this country with the intent that the purchaser shall make and use the invention abroad. Bullock Electric & Mfg. Co. v. Westinghouse Electric & Mfg. Co., 129 F. 105 (C.C.A.); Computing Scale Co. v. Toledo Computing Scale Co., 279 F. 648, 678 (C.C.A. 7); In re Amtorg Trading Corporation, 75 F.2d 826, 831 (Cust. & Pat.App.). Not disputing this principle of law when only part of the elements of a patented combination are involved in the sale, the plaintiffs apparently contend that it is inapplicable when all the elements are sold together, though disassembled and intended to be put into operable relationship only abroad. No authority has been cited which puts any such limitation upon the doctrine of contributory infringement; and on principle none such is justifiable. By their sales for export the defendants were guilty of neither direct nor contributory infringement." 79 F.2d at 628-629.

After the case had been heard on the merits, this matter was again before the Court of Appeals for the Second Circuit, Radio Corporation of America v. Andrea, 2 Cir. 1937, 90 F.2d 612. Additional facts introduced at the final hearing indicated that, before exporting them, the defendants assembled and used the receivers with the vacuum tubes in their sockets to determine the marketability of the receivers. Thus, the entire combination was completed and used in the United States. Thereafter, the tube was removed from its socket, and the receiver and the tube were packed in the receiver cabinet and sold. The tubes were placed in a separate carton and this, with the receiver, was placed in a larger carton. The purchaser needed only to connect the tube by inserting it in the socket. No adjustment was required; "no screw or nut need be tightened." The court found there was an infringement and said:

"Where the elements of an invention are thus sold in substantially unified and combined form, infringement may not be avoided by a separation or division of parts which leaves to the purchaser a simple task of integration. Otherwise a patentee would be denied adequate

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