Rubsam Corp. v. Gen. Motors Corp.

• Decision Date: 03 June 1940
• Docket Number: No. 31.,31.
• Citation: Rubsam Corp. v. Gen. Motors Corp., 294 Mich. 31, 292 N.W. 554 (Mich. 1940)
• Parties: RUBSAM CORPORATION v. GENERAL MOTORS CORPORATION.
• Court: Michigan Supreme Court

294 Mich. 31

292 N.W. 554

RUBSAM CORPORATION

v.GENERAL MOTORS CORPORATION.

No. 31.

Supreme Court of Michigan.

June 3, 1940.

Action by Rubsam Corporation against General Motors Corporation, a Delaware corporation, for damages for alleged breach of a license agreement. From an adverse judgment, plaintiff appeals.

Affirmed.

Appeal from Circuit Court, Jackson County; George B. Hartrick, judge.

Argued before the Entire Bench, except BUTZEL, J.

Whiting & Kleinstiver, of Jackson (Harness, Dickey & Pierce, of Detroit, of counsel), for appellant.

Milburn & Semmes, of Detroit (Prewitt Semmes, of Detroit, and Drury W. Cooper, and C. Blake Townsend, both of New York City, of counsel), for appellee General Motors Corporation.

McALLISTER, Justice.

This is an action for damages for the alleged breach of a license agreement to pay royalties on inventions and improvements relating to demountable rim wheel construction. Four patents were original involved. In Rubsam Corp. v. General Motors Corp., 281 Mich. 691, 275 N.W. 735, it was decided that there had been no use by defendant of patent 1. The case was thereafter remanded to circuit court for determination of whether patents 2, 3, and 4 had been used by defendant. On trial, the lower court entered judgment for no cause of action on the finding that there had been no use by defendant of the patents under the license agreement. Plaintiff appeals.

At the outset we are confronted by the question of the meaning and extent of the order of this court remanding the case. It is contended by plaintiff that the only question before the trial court was whether defendant had made use of patents 2, 3, and 4. Defendant maintains that the issue before the court was whether there had been a use of these patents under the license agreement. When the case was previously before this court, there was a subsequent modification made in the opinion and decision. Plaintiff, by motion, had called the attention of the court to the fact that, although the trial court had determined the question of use of patent 1, there had been no determination of the use of the other patents, and asked for a rehearing. In its application for rehearing, plaintiff pointed out that the circuit court had not ruled upon whether ‘defendant had adopted the patents 2, 3 and 4 under license’ and had not decided the question of ‘use under license of patents 2, 3 and 4’; and ‘the following questions as to patents 2, 3 and 4 (which were not passed upon by the trial court) are then presented and must necessarily be decided: (1) Did defendant adopt and acknowledge patents 2, 3 and 4, as improvements described in further patent or patents issued rights (sic-patents or patent rights issued) to plaintiff, and (2) did defendant use the same under license.’ In its opinion on motion for rehearing, this court remanded the cause to the circuit court ‘for determination of the claimed use of the second, third and fourth patents.’ Rubsam Corp. v. General Motors Corp., 281 Mich. 716, 279 N.W. 496, 497. The ‘claimed use’ referred to in the above opinion, was the use set forth as one of the questions properly to be decided in plaintiff's application for rehearing, and was use under the license agreement. This was the only question with regard to use of the patents that was properly before the circuit court in the instant case.

The granting clause of the license agreement, entered into between the plaintiff and defendant, is as follows: ‘Licensors hereby grant to licensee a license to manufacture or to have manufactured for it, wheels incorporating the invention or inventions as set forth in Patent No. 1,395,362 above referred to, and/or any and all improvements thereon, as described in any further patents or patent rights which may be issued to or acquired by licensors, always excepting any and/or all rights under Patent No. 1,403,439 to Mott, and which licensee may elect to acknowledge as such and use within the United States, and to sell or export the same as equipment on vehicles or replacements or service equipment therefor, subject to the conditions as hereinafter specified.’

The proposition before us on review is whether defendant made use of patents 2, 3, and 4 under the license agreement. In this regard, the trial court held that defendant's constructions were based upon a prior art, and that, therefore, plaintiff could not sustain its claim of use by defendant of its patents.

Plaintiff's contentions may be briefly summarized in the following statement: that patents 2 and 3 consisted of a vehicle wheel, provided with a demountable tire-carrying rim, and a metallic channel-shaped felloe. The felloe was adapted to engage or carry the demountable rim. This demountable rim was provided with arcuate indentations arranged circumferentially around it and adapted to engage the periphery of the outer flange of the channel-shaped fixed rim in order to support and center the demountable rim on the felloe or fixed rim of the wheel.

Defendant admits the use of a similar construction, but only for the purpose of employing such indentations to center, but not support, the demountable rim on the fixed rim.

A detailed description of the inventions and their purposes has been made in previous cases. Rubsam Corporation et al. v. General Motors Corporation et al., D.C., 57 F.2d 581;General Motors Corporation v. Rubsam Corporation, 6 Cir., 65 F.2d 217; and it is unnecessary in this case to repeat at length what has already been recited.

Devices for the centering of demountable rims had been previously employed in other inventions. The Baker patent, No. 1,095,953, as early as 1914, employed studs on the rim for the purpose of centering it on the fixed wheel. According to that patent, it was provided that the rim or felloe band be provided with fixed metallic studs or projections to properly center the demountable rim upon the wheel when it was placed thereon and to support the several arcs of the rim. It was stated as follows: ‘To properly center the rim upon the wheel when it is first placed thereon and to support the several arcs of the rim between the widely separated clamping devices I employ a structure or structures by which the rim and the wheel periphery are placed substantially in metallic contact at points intermediate of the several clamping devices, yet not so tightly as to prevent the easy mounting and demounting of the rim. I prefer to accomplish this effect by providing the rim or the felly band with fixed metallic studs or projections.’

The Harbridge patent, No. 1,165,096, of 1915 made use of a tire rim pressed inward at spaced intervals to contact the outer periphery of the felloe for the purpose of centering the tire rim upon the wheel body. The patent states:

‘Heretofore, it has been the practice to secure plates or studs either on the band or on the rim, or both, to provide bearings for the rim against flexure of the rim between the wedge lugs when the rim is on the wheel. The present invention dispenses with the necessity of these plates by indenting the band * * * to provide bearings for the inner face of the rim and by indenting the rim * * *. These indented portions, besides avoiding the necessity of securing studs or plates to the band or rim, avoid the necessity of drilling the band or rim for attachment of the studs or pivots for the plates. * * *

‘Claim 4. The combination with a wheel body having a metallic band thereon, of a tire rim of greater diameter than the periphery of the band to leave a space there-between, the rim having inwardly extending indented bearing portions for the band spaced from one another and disposed adjacent one side of the band, and devices independently of said bearing portions for securing the rim on the band.’

The Manternach patent, No. 1,336,531, of 1920 also had lugs attached to the rim for properly seating it upon the felloe.

With these centering devices already patented years before plaintiff's patents were even applied for, we are of the opinion that the evidence sustained the finding of the trial court that defendant's use of the devices was a use of prior art, rather than a use of plaintiff's patents. Westinghouse Electric & Mfg. Co. v. Formica Insulation Co., 266 U.S. 342, 45 S.Ct. 117, 69 L.Ed....