Leavitt v. McBee Co.

• Decision Date: 13 January 1942
• Docket Number: No. 3723.,3723.
• Citation: Leavitt v. McBee Co., 124 F.2d 938 (1st Cir. 1942)
• Parties: LEAVITT v. McBEE CO.
• Court: U.S. Court of Appeals — First Circuit

124 F.2d 938 (1942)

LEAVITT v. McBEE CO.

No. 3723.

Circuit Court of Appeals, First Circuit.

January 13, 1942.

Harold E. Cole, of Boston, Mass., for appellant.

Harry Lea Dodson, of New York City (William Gates, Jr., and Roberts, Cushman & Woodberry, all of Boston, Mass., on the brief), for appellee.

Before MAGRUDER, MAHONEY, and WOODBURY, Circuit Judges.

MAHONEY, Circuit Judge.

The plaintiff, owner of Letters Patent 1,544,172, filed a complaint in the District Court demanding a preliminary and final injunction against infringement of the patent by the defendant. There was a motion to dismiss the complaint because it alleged threatened infringement rather than actual infringement. The defendant also argued for the dismissal of the complaint on the ground that "said Letters Patent does not cover cards manufactured by the plaintiff under said Letters Patent, and because the patented construction cannot be embodied in a card inasmuch as the claim calls for a stack of cards." He also presented several reasons why the preliminary injunction should not be granted. The District Court denied the motion to dismiss the complaint and granted the preliminary injunction. The defendant has appealed both rulings.

The claim of the patent in suit follows: "A stack of cards each of which is provided adjacent an edge with a plurality of perforations every perforation so disposed that it may be directly and separately slotted out to the edge of the card, and only those perforations being so cut away as relate to a particular classification desired whereby with the stack positioned that the said cut away edges of the cards are at the top of the stack and on a separating device being passed through corresponding perforations of a number of said cards only those so cut away and pertaining to said classification will remain whilst the others may be removed by said separating device."

Should the preliminary injunction have been granted? In Simson Bros., Inc., v. Blancard & Co., Inc., 2 Cir., 1927, 22 F. 2d 498, 499, the court said: "We have often said that an injunction pendente lite in a patent suit should not go except when the patent is beyond question valid and infringed." The same rule was laid down in Packard Paper Co. v. O. B. Andrews Co., 1 Cir., 1933, 67 F.2d 783. Both parties to this suit concede that this is the rule, and the text-writers are agreed that it is the law. Robinson on Patents, § 1173 et seq.; 3 Walker on Patents (Seller's Ed.) § 773. In view of Leeds & Catlin Co. v. Victor Talking Machine Co., 1909, 213 U.S. 301, 29 S.Ct. 495, 53 L.Ed. 805, and Fireball Gas Tank & Illuminating Co. v. Commercial Acetylene Co. and Prest-O-Lite Co., 1915, 239 U.S. 156, 36 S.Ct. 86, 60 L.Ed. 191, both of which held there was no abuse of discretion in the granting of a preliminary injunction, this rule might be questioned. In the Leeds & Catlin case it is said at page 311, of 213 U.S., at page 497 of 29 S.Ct., 53 L.Ed. 805: "The court did not pass on the defense of infringement * * *," and at page 312 of 213 U.S., at page 498 of 29 S.Ct., 53 L.Ed. 805: "* * * we may pass the defenses of anticipation, whether complete or partial, and the defense of infringement." In the Fireball Gas Tank case the court said, at page 168 of 239 U.S., at page 90 of 36 S.Ct., 60 L. Ed. 191: "Whether it has patentable novelty is another question. And a serious question it is", and at page 169 of 239 U. S., at page 91 of 36 S.Ct., 60 L.Ed. 191: "The questions are seriously disputable * * *." The precise meaning of these statements and the particular bearing which the Supreme Court meant them to have on the cases before it are very difficult to determine. In the absence of a clear statement by the court on the matter here in question, we adhere to the rule laid down in this and the second circuit. We hold that a preliminary injunction should not be issued in the absence of a clear showing of infringement.

It is necessary to determine the grounds on which the preliminary injunction was granted in this case by the district judge. It is a fair interpretation of his memorandum of decision to say that the preliminary injunction was issued on the basis that the validity of the patent for the purposes of an injunction pendente lite was established by public acquiescence and a prior adjudication in McBee Co. v. Rembold,¹ Equity No. 4143-R in the United States District Court for the Northern District of California, Southern Division, and that infringement was "reasonably apparent" because the defendant's cards were substantially similar to the plaintiff's cards and the infringing cards in the prior adjudication. Finding that ownership, presumptive validity and infringement were clear, the District Court issued the preliminary injunction in accordance with what is apparently the established rule.

The defendant argues that it does not suffice for the district court to say that the California adjudication has settled the question of the validity of the patent. It urges that it is necessary also to answer the underlying question: What is the scope of the patent whose validity has been upheld? He maintains that the most that can be said for the California case on the latter question is that it held that the claim of the patent in suit covers a slotted or notched card. He adds that there has been no adjudication that the patent covers an unslotted or unnotched card, so that the District Court here must necessarily consider the scope of the claim before it can hold that it is "reasonably apparent" that the defendant's unnotched card in this suit infringes. The defendant concludes that since the court refused to consider this underlying question which is absolutely essential to any finding of infringement, the granting of the preliminary injunction by the trial court constituted error.

We hold that the District Judge did commit error and that the preliminary injunction, therefore, must be dissolved. It is obvious that before infringement can be found, the scope of the patent must be known. It clearly appears from the findings of facts and conclusions of law in the California case that the most it decided with respect to interpretation of the patent was that the claim covered a notched or slotted card. This is definitely shown by the following findings:

"V. That the language of the claim is directed to cards in which perforations are cut-away which relate to a single particular classification."

"VIII. That the language of the claim is directed to a combination of notches which form a pattern which refer to a single designated classification."

"IX. That `Keysort' cards have a pattern of notches which refer to a single designated classification."

"X. That `Keysort' cards are illustrated and described in the specification of the Perkins patent² No. 1,544,172."

"XXIV. That there is not disclosed in the prior art by any patent introduced in evidence by the defendant a card having a pattern of notches which relate to a single designated classification."

"XXVIII. That by the use of cards having a pattern of notches in their edge which refer to a single designated classification an entirely new result is obtained."

"XXXVI. That `E-Z Sort' cards have a pattern of notches which refer to a...