This
action was brought by George H. Stahl against the Reliable
Incubator & Brooder Company. A motion made by the defendant
in error to strike from the record the bill of exceptions has
been sustained (42 C.C.A. 522, 102 F. 590), but it is still
insisted by the plaintiff in error that upon the fact of the
declaration the court below was without jurisdiction of the
cause.
The
second amended declaration, on which the trial was had
purporting to be for trespass on the case, shows that both
parties were citizens of Illinois when the suit was
commenced; that on November 1, 1892, the plaintiff was a
resident of the city of Quincy, and was engaged in the
business of manufacturing and selling, and was the owner of
letters patent of the United States pertaining to, incubators
and incubating and brooding devices and appliances; that at
the same time and place the defendant was engaged in a
similar business in competition with the plaintiff, and being
so engaged they entered into a contract, a copy of which is
set out; that afterwards, on October 1, 1893, differences and
disputes having arisen between them, they entered into a new
contract in lieu of the first, a copy of which is set out
and of which the provisions bearing upon the present question
are as follows: 'Now, therefore, this agreement made and
entered into this 21st day of October, A.D. 1893, by and
between George H. Stahl, of the first part, and John W
Myers, William B. Dean, Clarence A. Myers, and the Reliable
Incubator and Brooder Company, a corporation, parties of the
second part, witnesseth: That the said party of the first
part is the owner of certain letters patent upon incubators
bearing dates and numbers as follows, to wit (a list of 38
patents), * * * (and,) in consideration of the premises
herein set forth, contracts to license and permit, and hereby
does license and permit, the parties of the second part to
make, use, and sell, anywhere in the United States
incubators of the same pattern and style as are not made and
sold by them under the name and style of Reliable Incubator
and Brooder Company and similar to the sample furnished by
the said party of the first part, and to give to them the
full protection of all of his said letters patent, against
all parties whatsoever, in the manufacture, use, and sale of
the said incubator in its present style and pattern; but this
license is not to be construed as authority to said party of
the second part to make or sell any other incubator, or to
modify the said incubator so as to incorporate any additional
features or improvements in incubators which may be covered
by any of the letters patent of the said party of the first
part, and the said party of the first part expressly reserves
to himself all right to make, use, and sell all incubators
and improvements covered by his said letters patent, and to
grant license to and contract with all other parties
concerning the same. And the said parties of the second part,
for and in consideration of the permission and license set
forth, and the further consideration of the protection of the
aforesaid letters patent of the party of the first part,
hereby promise and agree and contract to pay to the said
party of the first part the sum of 75c. for each and every
incubator of capacity not to exceed 55 eggs, and known as No.
0, and one dollar for each and every other incubator made and
sold, leased, or rented by them or their agents after the
21st day of October, 1893. * * * It is further expressly
agreed that the said parties of the second part shall make on
the first day of each month a sworn statement to the said
party of the first part of the number of incubators made,
used, and sold by them and their agents for and during the
preceding month, and thereupon to pay to the party of the
first part the amount found due him according to the terms of
this contract at the rate of $1 for each incubator, except
the 55-egg capacity incubator, and 75c. for each incubator of
that size and number, and, (for) the failure to make
such report and pay over all sums found due according to the
terms of this contract, said party of the first part may, at
his option, terminate this contract upon giving said party of
the second part twenty days' notice in writing of his
election so to do. * * * It is agreed that this contract
shall continue in force for the term of ten years from the
1st day of November, A.D. 1892, but the parties of the second
part shall not assign their interest herein, except upon the
written consent of the said party of the first part. In
witness whereof,' etc.
Compliance
with the contract by the defendant until February 1, 1896, is
next alleged, and then the declaration proceeds: 'And the
plaintiff avers that thereby and by reason of the premises
the defendant then and there became, and was and still is
the licensee of the plaintiff under the patents mentioned in
said contract of license last aforesaid; and it became and
was then and there the duty of the said defendant not to make
its said incubators in any style or pattern different in any
respect from the said style and pattern in which it was
licensed to make the same by the terms, conditions, and
limitation of the said last-mentioned contract of license in
writing, and not to modify the said incubators so as to
embrace or include therein any device or contrivance covered
by or embraced in the said contract of license secondly
hereinabove set forth, and to make truthful and complete
monthly reports of the number and sizes of its said
incubators made and sold by it, and to pay the license fees
thereon according to the tenor and effect of the said
last-mentioned contract of license, and to maintain and not
to impeach or deny with and against the public the validity
of the said letters patent in the said contract of license
set forth, and not to deny or in any manner impeach the
novelty and utility of the devices embraced in or covered by
its said license, or the title of the plaintiff in and to the
letters patent set forth in the said secondly above set forth
contract of license. Yet the defendant wholly disregarded its
said duties and obligations to the plaintiff, at and within
the United States, to wit, the city of Quincy, in the county
of Adams and state of Illinois, aforesaid, and during the
term of duration of the said contract of license secondly
hereinabove set forth, and while said last-mentioned contract
of license was in full force and effect and binding upon all
the parties thereto, and contrary to the terms and conditions
thereof, and against the statutes of the United States in
relation to letters patent of the United States, and
wrongfully and fraudulently intending and designing to injure
and more effectually to compete with the plaintiff in his
said business, and to deprive him of the just benefit and
advantage of his said letters patent, and to deprive him of
the large profit he would otherwise have made in the
manufacture of and sale of incubators and kindred devices,
and to defraud him of the license fees justly due him under
and by reason of the said last-mentioned contract of license
prior to the commencement of this suit, to wit, between the
21st day of October, 1893, and the sixteenth day of April,
1896, made 4,500 of its said incubators in styles and
patterns different from the style and pattern in which it was
and had been making the same at the time of and prior to the
making of the said contract of license hereinabove secondly
set forth, and different from the sample mentioned in said
contract of license, and put upon sale and sold and disposed
of the same in the markets of the United States, and modified
and changed the style and pattern of its said incubators by
omitting therefrom the water tank, which was a feature of and
in the style and pattern of incubator the defendant was
licensed to make as aforesaid, and at the time and place
aforesaid made 2,000 other incubators in such said changed
style and pattern, and sold and disposed of the same in the
markets of the United States, and changed and modified the
said style and pattern in which it was licensed as aforesaid
to make the said incubators by omitting therefrom certain
openings with thumb-plate covers for the purpose of
ventilating, and substituting therefor additional openings in
the bottom of the...
