Macbeth-Evans Glass Co. v. General Electric Co.

• Decision Date: 06 November 1917
• Docket Number: 2900.
• Parties: MACBETH-EVANS GLASS CO. v. GENERAL ELECTRIC CO.
• Court: U.S. Court of Appeals — Sixth Circuit

246 F. 695

MACBETH-EVANS GLASS CO. v. GENERAL ELECTRIC CO.

No. 2900.

United States Court of Appeals, Sixth Circuit.

November 6, 1917

Paul Synnestvedt, of Philadelphia, Pa., Joseph Wilby, of Cincinnati, Ohio, and James I. Kay and James C. Bradley, both of Pittsburgh, Pa., for appellant.

Squire Sanders & Dempsey, of Cleveland, Ohio (F. P. Fish and W. K Richardson, both of Boston, Mass., and William L. Day, of Cleveland, Ohio, of counsel), for appellee.

Before WARRINGTON, KNAPPEN, and DENISON, Circuit Judges.

WARRINGTON Circuit Judge.

This was a suit for infringement of letters patent reissue 13,766 bearing date July 7, 1914, to George A. Macbeth, assignor to Macbeth-Evans Glass Company, a corporation of Pennsylvania. The invention relates to a 'method and batch or mixture for making glass for illuminating purposes such as in electric and other shades and globes. ' The pleadings present the usual issues of a patent suit, except that a distinct defense was introduced and made the basis of the decision. This was brought about in pursuance of Equity Rule 29 (198 F. xxvi, 115 C.C.A. xxvi), and on motion of defendant below, the General Electric Company, separately to hear and dispose of the defense set up in paragraph 14 of its answer the facts, for purposes of the motion and hearing, being stated in a written admission of plaintiff below, Macbeth-Evans Glass Company, which was filed with the motion. According to the facts so shown, George A. Macbeth discovered and perfected the formula and process in issue prior to the fall of 1903. About the fall of that year, the appellant company (with which Macbeth was connected as president and stockholder) commenced to use the formula and process 'as secret inventions for making illuminating glass,' and thereafter continued such use until the application of Macbeth for the original letters patent (No. 1,097,600) was filed, May 9, 1913. Throughout this period the products of the formula and process were 'put upon the market and sold in this country in large quantities as regular articles of trade and commerce.'

In May, 1910, one of the plaintiff company's employes, who had been intrusted with the secrets of the invention set out in the reissued letters patent, left the company's employ and without its knowledge and in fraud of its rights disclosed these secrets to officials of the Jefferson Glass Company; and prior to the 17th of the following December that company began a secret use of the invention and continued such use until after application was made for the patent as stated, May 9, 1913, and placed the products upon the market and sold them in this country as 'regular articles of trade and commerce continuously from and after a date prior to December 17, 1910.'

On the last-mentioned date, appellant commenced an action in the common pleas court of Allegheny county, state of Pennsylvania, against its former employe and the Jefferson Glass Company, including also a salesman of appellant who had left its employ and entered that of the Jefferson Glass Company, praying injunction against disclosures of the secrets to others and further manufacture and sale of glass under the secret formula and process. January 30, 1912, decree was entered in that court enjoining defendants from making any glass 'by substantially said secret process and formula and from disclosing the same to others. ' This decree was affirmed by the Supreme Court of Pennsylvania January 6, 1913. Macbeth-Evans Glass Co. v. Schnelbach, 239 Pa. 76, 86 A. 688.

The instant case was heard below upon the facts thus in substance stated. District Judge, now Mr. Justice, Clarke, entered a decree adjudging the patent in suit to be void 'because the discovery was used in the manner stated in the stipulation for almost ten years before the patent in suit was applied for, and was therefore abandoned, and also because the invention described in the patent was in public use more than two years prior to the application of (for) the patent' (231 F. 183, 190); accordingly, the bill was dismissed. The Macbeth-Evans Glass Company appeals.

The question is whether one who has discovered and perfected an invention can employ it secretly more than nine years for purposes only of profit, and then, upon encountering difficulty in preserving his secret, rightfully secure a patent, and thus in effect extend his previous monopoly for the further period fixed by the patent laws. Are both of these courses consistent with a reasonable interpretation of the constitutional provision and the statutes of the United States in relation to patents?

It is earnestly contended for appellant that its rights under the patent in issue are to be tested (1) by the use that was made of the invention, rather than of the product of the invention, prior to the application for a patent, and (2) by the acts if any of appellant and its assignor Macbeth, which would evince an intent to abandon the invention as distinguished from the right to patent the invention. The argument is that, when the acts of Macbeth and appellant are tested by the language of the patent laws, the secret use made of the invention could not have been a public use, and the constant effort made to preserve the secret was inconsistent with intent to abandon the invention; and consequently that the public use and the abandonment contemplated by the patent laws are inapplicable to the present case. The statutory provisions relied on are sections 4886 and 4920, Rev. Stat. (16 Stat. Sec. 24, p. 201, section 61, p. 208 (Comp. St. 1916, Secs. 9430, 9466)). Section 4886 provides:

'Any person who has invented or discovered any new and useful art, machine, manufacture, or composition of matter, * * * not known or used by others in this country, and not patented, or described in any printed publication in this or any foreign country, before his invention or discovery thereof, and not in public use or on sale for more than two years prior to his application, unless the same is proved to have been abandoned, may * * * obtain a patent therefor.'

Section 4920 enumerates 'special matters' which in an action for infringement may upon notice be proved under the general issue, and among them:

'Fifth. That it (the invention or discovery) had been in public use or on sale in this country, for more than two years before his application for a patent, or had been abandoned to the public.'

The existence of all the conditions thus prescribed is essential alike to the right to issue or to obtain a patent; the absence of any one of the conditions is fatal. It is to be added that section 4884 (Comp. St. 1916, Sec. 9428) limits the grant of every patent to a 'term of seventeen years.' The requirements and the limitation so imposed existed at the date of the patent in issue, and they were enacted in virtue of the power vested by the Constitution in Congress 'to promote the progress of science and useful arts, by securing for limited times to * * * inventors the exclusive right to their respective * * * discoveries. ' Article 1, Sec. 8. These provisions at once define a public purpose and the restrictions under which it is intended to be accomplished. The subject is a broad one; but the compass of the present case is restricted. No decision has come to our attention upon facts precisely like those here involved; in a word, the case is sui generis. It is not necessary, we may observe, to consider the portion of the decision below which deals with the question of public use. Our consideration will be limited to questions pertinent to abandonment.

In considering the subject of abandonment we assume that the patent is for a process which is not unitary with the product. If, indeed, this patent is for a process, and if the process and the product are distinct inventions separately patentable (as has been held in more or less analogous situations--the Leeds-Catlin Case, 213 U.S. 301, 318, 29 Sup.Ct. 495, 53 L.Ed. 805; the Acetylene Case, 192 F. 321, 325, 326, 112 C.C.A. 573 (C.C.A. 6), and see Judge Lurton's comment in the Sanitas Case, 139 F. 551, 552, 553, 71 C.C.A. 535 (C.C.A. 6)), there are some difficulties in the way of concluding that secret use of the process resulting in public use and sale of the product constitutes the statutory public use of the invention. It is these difficulties which we pass by when we make, for the purpose of the opinion, the assumption just stated.

It is in substance urged for appellee that there is distinct inconsistency between the right to a trade secret and the right to a patent; and that Macbeth, having elected to use his invention as a trade secret for some ten years instead of applying for a patent, could not under settled principles of the doctrine of election turn around and assert the inconsistent right to a patent. It is not entirely clear whether appellee's counsel mean that the right to practice an invention in secret and for profit is inconsistent with the right to obtain a patent for the invention or with the right acquired under a granted patent; but we understand them to treat the trade secret as the invention. Macbeth, like any inventor of a new and useful object, possessed the right to practice his invention in secret and for profit, though the secret was the sole source of protection for the invention. He had no right to exclude others from legitimate discovery and use of the invention (John D. Park & Sons Co. v. Hartman, 153 F. 24, 29, 82 C.C.A. 158, 12 L.R.A. (N.S.) 135 (C.C.A. 6); Chadwick v. Covell, 151 Mass. 190, 191, 23 N.E. 1068, 6 L.R.A. 839, 21 Am.St.Rep. 442); but he had an inchoate right to the exclusive use of the invention, which right, apart from the issues of the instant case, he might have perfected and made absolute by proceeding in the manner...