National Heeling-Mach. Co. v. Abbott

• Decision Date: 10 October 1895
• Docket Number: 495.
• Citation: 70 F. 54
• Parties: NATIONAL HEELING-MACH. CO. et al. v. ABBOTT.
• Court: U.S. District Court — District of Massachusetts

70 F. 54

NATIONAL HEELING-MACH. CO. et al. v. ABBOTT.

No. 495.

United States Circuit Court, D. Massachusetts.

October 10, 1895

John Lowell and Clarke & Raymond, for complainants.

Lund Davis & Welch, for defendant.

PUTNAM Circuit Judge.

Theoretically the granting of an interlocutory injunction in a cause in equity does not prejudice a hearing on bill, answer, and proofs; but it is not always certain that a court which has heard preliminary motions on a hasty, and perhaps partial grouping of the facts, can, when it comes to the final disposition of the suit, erase the impressions previously gathered. The court has endeavored to do so here, and has carefully examined the record as presented on final hearing, with a view of disposing of the case anew, yet its conclusions are practically the same as they were when it granted the interlocutory injunction.

The patent involved in this case is described as for an improvement in heel-trimming machines, and was issued in 1879 to Henderson and Paine. The original purpose of the patentees was the trimming of wooden heels, but, soon after the patent was issued, it was discovered that it could be used in connection with finishing leather heels. It is said that the machine patented required some modification for the latter purpose; but whether this was so, or not, the court does not find it necessary to determine. The plaintiffs in this case are the National Heeling-Machine Company and the Ross Heel Company, each a corporation, and the defendant is William T. Abbott. The issue is entirely between the Ross Heel Company and Abbott, each claiming to be licensees of the original patentees; and no questions touching the validity of the patent, or infringement, arise. The Ross Heel Company claims an exclusive license so far as the machine can be used for the purpose of finishing wooden heels, and only to that extent. The patent-office records show an assignment of the entire patent to F. F. Raymond, 2d, as trustee, and a later one from him to the National Heeling-Machine Company. If the Ross Heel Company is the holder of an exclusive intervening license, as claimed by it, it, of course, had a right to bring this bill, making the assignee of the patent a party. But no question as to parties is made in the case, except so far as it is necessarily involved in the main issue which we are to consider. The assignment to Raymond describes him as trustee, without indicating on its face who are the beneficiaries under the trust. Probably, under Railroad Co. v. Durant, 95 U.S. 576, 579, and National Bank v. Insurance Co., 104 U.S. 54, 63, adopting the rule of Shaw v. Spencer, 100 Mass. 382, the obligation rested on any person taking a title from Raymond to ascertain the nature of the trust, and his right to make a title. On the other hand, in cases where the trust is not declared on the face of the instrument, on account of the difficulties and hazards which fall on persons dealing with the trustee, in ascertaining what are his powers, and even who are the beneficiaries, equity casts on such beneficiaries, when, as in this case, they create the trust, the duty of acting in good faith, so as to prevent strangers from being prejudiced by their acquiescence, and an estoppel easily arises against them.

It is claimed by the defendant that the Ross Heel Company, which holds under Raymond, through intervening licenses, is not an innocent licensee, and that when it took its license it had knowledge of the alleged existing relations between Raymond, as trustee, and Henderson and Paine; but it is clear that its predecessor in title was wholly innocent, and that, whatever knowledge the Ross Heel Company might have had or could have acquired, it is, under the circumstances, entitled to all the equities possessed by that predecessor.

It appears that Raymond was the attorney of Henderson and Paine with reference to this patent, which is an important fact. It does not appear that he was ever discharged by them, as such attorney until after the rights of the predecessors in title of the Ross Heel Company were fixed. It is claimed by the defendant, and testified by Henderson and Paine, that they were not aware they had made a general assignment of the patent to Raymond, as trustee; that they did not intend to do so; and that whatever they did execute was in blank, and was filled out by him contrary to their directions. But, even if they signed the instrument in blank, they knew it related to this patent; so that, so far as the rights of innocent strangers are concerned, they are estopped from denying the right of Raymond to fill out the assignment as we find it. It is...