McCreery Engineering Co. v. Massachusetts Fan Co.

• Decision Date: 09 April 1912
• Docket Number: 937.
• Citation: 195 F. 498
• Parties: McCREERY ENGINEERING CO. v. MASSACHUSETTS FAN CO. et al.
• Court: U.S. Court of Appeals — First Circuit

195 F. 498

McCREERY ENGINEERING CO. v. MASSACHUSETTS FAN CO. et al.

No. 937.

United States Court of Appeals, First Circuit.

April 9, 1912

Fred L Chappell (Samuel D. Elmore, on the brief), for appellant.

Odin Roberts (Roberts, Roberts & Cushman, Charles D. Woodberry Waldron H. Rand, Jr., and Stewart, Coolidge & Rand, on the brief), for appellees.

Before PUTNAM and ALDRICH, Circuit Judges, and BROWN, District Judge.

BROWN District Judge.

This is an appeal from the judgment of the Circuit Court dismissing a bill for infringement of letters patent No. 917,185, issued April 6, 1909, on an application of W. E. Taylor, filed March 5, 1908, for apparatus for tempering and purifying air.

The Circuit Court found that the patent was invalid for the reason that the invention was on sale for more than two years prior to the application for the patent.

The chief reliance of the defendant on this issue is the record made upon behalf of the patentee to the Commissioner of Patents, with statements and disclosures of the file-wrapper and contents. The facts relied upon by the defendant are briefly that on February 27, 1905, Taylor, the patentee, made proposals to a building committee of the Second Church of Christ, Scientist, and to a Kansas City concern for the construction of the apparatus described and claimed in the patent in suit and quoted a price; that thereupon a contract was entered into March 16, 1905, under the terms of which the work under the contract was to be completed February 27 1906; but that the work was not completely installed upon that date, but was completed and paid for July 3, 1906.

A question is raised of the sufficiency of the record to show that the contract was based upon completed drawings and specifications, but for the purposes of this case this may be assumed.

Upon the whole record, nevertheless, there is a failure of proof that the apparatus of the patent in suit had been actually constructed at any time prior to March 5, 1906.

There is proof of an executory contract for future construction, but there is nothing sufficient to show that the invention had ever been reduced to practice prior to March 5, 1906, two years before the application date, March 5, 1908.

That drawings and verbal description of the invention, however completely they may show conception, are insufficient to establish reduction to practice unless filed as an application for a patent, when they are accepted as a constructive reduction to practice, was decided by this court in Automatic Weighing Machine Co. v. Pneumatic Scale Corporation, 166 F. 288, 92 C.C.A. 206.

The appellees contend 'that where an inventor, having his invention in such condition that he can apply for a patent upon it,' offers to sell the thing patented, there is an instance of 'on sale,' regardless of whether a physical embodiment of the invention be existent or nonexistent.

It is true that, having a complete description by words and drawings, the inventor may go into the Patent Office with a good application, though he has never embodied his invention in a machine or manufacture.

It also seems to be settled for this circuit by Automatic Weighing Machine Company v. Pneumatic Scale Corporation, 166 F. 288, 298, 92 C.C.A. 206, that a complete conception thus evidenced must be followed by either actual reduction to practice or by constructive reduction to practice, i.e., an application for a patent. It was said:

'A conception of this character is not a complete invention under the patent laws. It may constitute an invention in a popular sense, but it does not make the inventor 'the original and first inventor under the statutes.'' It may be further said that not only in a popular sense, but in a scientific sense, a conception of this character reduced to text and drawings may furnish satisfactory evidence of the completion of the intellectual act of invention.

There is, perhaps, a certain inconsistency in holding that drawings and text filed in the Patent Office show completed invention, but that exhibited to others they prove only conception and not completed invention. The distinction is not scientific, but is merely practical, based upon considerations of public policy. The rule is simply that one who in a scientific sense is entitled to credit as a first inventor has rights to a patent and as against other patentees only under certain conditions. He must follow his act of invention by recording it in the Patent Office, or put it into physical form.

There are reasons, however, requiring that we should adopt a view of the effect of private drawings which will be consistent in different applications of the patent law.

The law should encourage the inventor to embody his invention in practical form, even though it excuses him from doing so if he files his application in the Patent Office.

Frequently the first step towards a reduction to practice is the taking of drawings of his invention to third parties to get an order for the machine. It would be a harsh rule to make his application for assistance for reduction to practice a placing of a completed invention on sale.

We are of the opinion that proof of a mere contract to construct from plans and to deliver in future a machine or manufacture not proven to have been previously completed, falls short of proof that the machine or invention was 'on sale.' The distinction between an executory contract to construct and to pass title in the future and putting an article 'on sale' is substantial and is not merely one of the 'witty diversities' of the law of sales. Especially is that distinction important when such an executory contract is for the manufacture or construction which constitutes the first reduction to practice.

That inventors who have reduced their conceptions to the shape of drawings or descriptions and have endeavored to enlist capital by offering to construct and deliver a machine in the future should, by the display of drawings and offers to construct, be regarded as having placed the machine 'on sale,' would involve a departure from the intention of the patent statute as well as from the ordinary significance of language.

The opinion of the Circuit Court of Appeals of the Second Circuit in National Cash Register Co. v. American Cash Register Co., 178 F. 79, 101 C.C.A. 569, does not support the defendant's contention. That case decides merely that the manufacture of a machine upon an order for its construction followed by its delivery and acceptance constitutes a sale within the patent statute. This is far from supporting the contention that regardless of subsequent delivery and acceptance the article is on sale and that an agreement to construct is a putting on sale.

In cases where delivery and acceptance are complete, the distinction between delivery and acceptance upon a previous order and without a previous order has no substantial relation to the purpose of the statute. The completion of the transaction by delivery and acceptance affords evidence that the article was 'on sale' within the meaning of the statute.

Neither does the case of sale by sample, or by photograph of an existing thing, aid the defendant. The existence of a sample proves reduction to practice, as does a photograph.

In Norfolk & West Ry. Co. v. Sims, 191 U.S. 441, 447, 24 Sup.Ct. 151, 152 (48 L.Ed. 254), it was said:

'A sale really consists of two separate and distinct elements: First, a contract of sale, which is completed when the offer is made and accepted; and, second, a delivery of the property, which may precede, be accompanied by, or follow the payment of the price, as may have been agreed upon by the parties.'

Both in sections 4920 and 4866, Rev. St. (U.S. Comp. St. 1901, pp. 3394, 3382), the words 'public use or on sale' are coupled together.

There is authority for holding that an offer to sell a completed article puts the article 'on sale' at the time of the offer. Upon this question, however, we reserve our opinion, for there is reason to doubt whether an offer to deliver an article at a future time is in substance a putting on sale before the time of actual delivery.

No amount of public use within two years is of any effect even if in pursuance of a contract made before the two years. The putting 'on sale' intended by the statute is more or less analogous to a public use, and has regard to actual and completed transactions, and not to agreements which contemplate both a future production and a future transfer of title.

The learned judge in the Circuit Court stated that there is nothing in the record to show that the apparatus in question was the first constructed by the complainant, or that the contract contemplated anything experimental, and cites Swain v. Holyoke Machine Co., 109 F. 154, 48 C.C.A. 265, to the point that the burden of proving that the use was experimental rested upon the patentee. That case does not, however, aid the defendant. A use had been proved; therefore the burden to prove it experimental and to take it out from the statute was a burden of meeting evidence sufficient to invalidate the patent. Under the defense that the machine was 'on sale,' the burden rests upon the defendant to show that the machine existed as a complete article of sale, not on paper, but in fact. In the absence of such proof, the case is not brought within the statute, and therefore no exception need be proved. In fact, if a sale were proved, it is doubtful if the purpose for which it was made could be material.

Assume that the article never was completed in accordance with the existing contract; could it be fairly said that it was ever on sale? Not unless we stretch the words 'on sale' to that meaning most unfavorable to the inventor, and give them their worst...