Reynolds v. Whitin Mach. Works

• Decision Date: 14 June 1948
• Docket Number: No. 5697.,5697.
• Citation: 167 F.2d 78
• Parties: REYNOLDS et al. v. WHITIN MACH. WORKS.
• Court: U.S. Court of Appeals — Fourth Circuit

167 F.2d 78 (1948)

REYNOLDS et al. v. WHITIN MACH. WORKS.

No. 5697.

Circuit Court of Appeals, Fourth Circuit.

March 10, 1948.

Writ of Certiorari Denied June 14, 1948.

Hunter M. Jones and Frank H. Kennedy, both of Charlotte, N. C. (John M. Robinson, of Charlotte, N. C. and E. O. Ayscue, of Monroe, N. C. and Russell M. Robinson, of Greensboro, N. C., on the brief), for appellants and cross-appellees.

William H. Holderness, of Greensboro, N. C., and Newton A. Burgess, of New York City (L. P. McLendon, of Greensboro, N. C., and Reginald Hicks, of New York City, on the brief), for appellee and cross-appellant.

Before PARKER, SOPER and DOBIE, Circuit Judges.

Writ of Certiorari Denied June 14, 1948. See 68 S.Ct. 1513.

PARKER, Circuit Judge.

This is an appeal in a suit instituted by W. G. Reynolds and others against the Whitin Machine Works involving Reynolds patent No. 2,238,659, covering an improved process of cotton roving and an improved cotton roving frame. Damages were asked for infringement of the patent and also on the ground that defendant in violation of the rights of the plaintiffs had appropriated and used confidential information which plaintiff Reynolds had imparted to one Banfield, who after acquiring the information had been employed by defendant. The District Judge held the patent valid and infringed and found in addition that defendant had improperly acquired and made use of confidential information as plaintiffs contended. He held, however, that, for the latter wrong, the North Carolina statute of limitations barred recovery of damages accruing more than three years prior to suit; and the practical effect of this holding was to restrict the recovery to profits and damages on account of the infringement of the patent, since the measure of recovery for this was the same as under the other cause of action and the alleged infringement covered the full three year period not barred by the statute. Defendant has appealed from the judgment holding the patent valid and infringed, and plaintiffs have appealed from the holding that the three year statute of limitation is applicable to the common law cause of action. We think that with respect to all these matters the judgment appealed from was correct. In the view that we take of the case, three matters require consideration: (1) the validity of the patent, (2) the question of infringement, and (3) the statute of limitations.

So far as questions concerning the validity and infringement of the patent are concerned, this appeal involves little more than a rehashing of the matters decided by us in Saco-Lowell Shops v. Reynolds, 4 Cir., 141 F.2d 587, 590. In that case Saco-Lowell, being a licensee, was precluded from questioning the validity of the patent; but resort was had to the prior art in an attempt to limit the coverage of the patent, with the result that its validity, except as related to the language of the claims, was necessarily passed on in considering the extent of its coverage. Nothing adduced in this case has caused us to doubt the correctness of the conclusions there reached, which are determinative on the questions of validity and infringement here involved. The facts necessary to an understanding of the patent were set forth in our opinion there, from which we quote as follows:

"The invention of Reynolds relates to what is known as the `roving' of cotton fibre in preparation for spinning into cotton yarn. The roving process consists in taking a strand of cotton fibres called a `sliver' and submitting it to pulling or `drafting', as a result of which the sliver is lengthened and attenuated and the fibres of cotton are drawn parallel to each other. Drafting is accomplished by passing the sliver between two pairs of rolls in succession, the second pair operating at a greater rate of speed than the first. The ordinary roving process prior to the invention of Reynolds required three or more distinct drafts; and it was necessary to reform the sliver between drafts by twisting it on a bobbin, so that as many roving frames were required as there were drafts of the sliver.

"Reynolds conceived the idea of performing a series of drafts upon a single machine by reforming the sliver without twisting between drafts. He devised a machine, covered by patent No. 1,738,796, which was to reform the sliver between drafts by a folding process accomplished by the use of rollers having a tongue and groove engagement. These tongue and groove rollers not only reformed the sliver by folding after the first draft but also held it against a second draft made by the succeeding pair of rollers which operated at a greater rate of speed than they. The machine of this first patent was not satisfactory, however, and Reynolds improved it by providing that the folding rollers with the tongue and groove should be on a plane slightly lower than the rollers effecting the preceding draft and should be operated at a slightly advanced rate of speed so as to take up any slackness in the sliver due to the folding operation. The effect of the lowering of the tongue and groove rollers was to hold the sliver in tension, first against the surface of the rollers from which it was coming and then against the surface of the groove of the folding roller into which it was entering. The machine with these improvements worked satisfactorily. It embodied three concepts: (1) Reforming the sliver between drafts by a folding process, (2) holding the fibres from vertical and transverse expansion between the drafts by causing the sliver to travel under tension against surfaces, and (3) using a difference in speed, or take up, to eliminate fullness due to folding.

"After Reynolds had built a machine of the improved character heretofore described and had placed it in successful operation, the defendant,¹ one of the leading manufacturers of textile machinery in the United States, approached him and proposed that he license the manufacture of the machine by defendant and that he himself enter the service of defendant and work toward perfecting the machine for commercial production. Reynolds agreed to this and spent goodly portions of the years 1933 and 1934 working in defendant's plant with other employees of defendant's experimental department. During this period patent attorneys for defendant cooperated with patent attorneys for plaintiffs in making application for a patent on the improved machine. Application for the patent was filed in July 1934 and the patent, No. 2,238,659, was issued in April 1941.

* * * * * *

"The machine and process of the Reynolds patent undoubtedly marked a great step forward in the art. As said in the opinion of the court below, it `revolutionized roving in textile plants and became a pronounced commercial success. Six men with this patented device could do the work generally requiring eighteen; one machine did the work of two, sometimes three.' It was hailed by defendant in its advertising bulletins as being revolutionary in character, the following significant statement with regard thereto appearing in its bulletin of October 1934: `From the first we had realized that this new drafting mechanism is a radical departure from conventional ideas of roving machinery and in the matter of doublings it is a wide-open break with tradition * * *. The facts, as developed in actual mill use, regarding the performance, economy and simplicity of the machine square in every respect with the specifications we had set up as our practical ideal. It provides a unique, simple and effective method of eliminating unnecessary roving operations, and for most organizations makes possible the production of roving for the spinning frames of the required quality and size by a continuous controlled draft, in a single operation.' There was immediate and widespread demand for the machine; and as above stated, royalties of more than $100,000 were paid to plaintiffs, most of these from orders received prior to 1937.

"In May 1934, while Reynolds was still working on the machine of his invention with the draftsmen and engineers of defendant, he conceived the idea that the folding device of the machine might be made stationary and communicated this idea to the employees of defendant with whom he was working and caused it to be inserted in the specification of the patent for which application was made. His thought at first was that a stationary grooved folding block could be substituted for the grooved roll, and a successful experiment in which such folding block was used in connection with the tongued roll was made in defendant's experimental department. He discussed with one of defendant's engineers with whom he was working the advisability of using the folding block without the tongued roll engaging it, but with an ordinary pair of rollers so placed as to engage the sliver immediately after it passed through the folding block. In 1937, after Reynolds had left defendant's service, defendant secured through Jones, one of its engineers, a patent on a machine of this character and began manufacturing it without notice of any sort to plaintiffs. On seeing it, plaintiffs asked in their patent application, which was still pending, that they be allowed claims broad enough to cover the process and mechanism involved. An interference proceeding was initiated by the Patent Office and priority on the four claims involved in this proceeding was awarded plaintiff, although three of the claims were subsequently disallowed. Three additional claims were then filed and allowed, and these, as we shall point out hereafter, fully cover the J frames of defendant's manufacture."

To this we add that, at the time of seeing the Saco-Lowell frames which infringed their patent, plaintiffs saw also the infringing frames of Whitin Machine Works, the defendant here; that the patent under which Whitin claimed to have made them was before the Patent Office in the interference proceeding; that the broadened claims...