Russo v. Thompson

• Decision Date: 05 March 1936
• Citation: 200 N.E. 570,294 Mass. 44
• Parties: RUSSO et al. v. THOMPSON et al.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

294 Mass. 44

200 N.E. 570

RUSSO et al.

v.THOMPSON et al.

Supreme Judicial Court of Massachusetts, Suffolk.

March 5, 1936.

Suit in equity by Dominik Russo and others against John L. Thompson and others. From interlocutory and final decrees in the Superior Court, the defendants appeal.

Interlocutory decrees affirmed, and final decree modified.Appeal from Superior Court, Suffolk County; Fosdick, Judge.

J. Wasserman, of Boston, for appellants.

C. T. Bahn, of Boston, for appellees.

QUA, Justice.

The allegations of the bill, briefly summarized, are these: The plaintiffs, with labor and expense, have developed and perfected a shoe press for resoling shoes without the use of nails, which they have placed upon the market, which has become known as the Russo machine, and for which, through diligent effort and advertising, they have created a valuable good will. The defendant Thompson has manufactured machines which are copies in detail and design of the Russo machine, including all its characteristic features, and has palmed them off to the trade as and for the Russo machine. The defendant Laganas, purporting to be the owner of a patent for a ‘shoe level machine * * * radically different from the Russo machine,’ and the defendant Thompson, purporting to be a licensee of Laganas, intending to deceive the public and to defraud the plaintiffs, have sent out to the trade an advertisement or ‘warning’ containing a photograph of the Russo machine or of such a close imitation as to be indistinguishable from it, carrying, and intended to carry, the false implication that the Russo machine is the Laganas machine protected by the Laganas patent, and threatening suit against all persons using machines of that character which do not bear the number of the Laganas patent. The defendants have persisted in their wrongful conduct. The prayers are for injunctive and other relief and for damages.

The demurrers of both defendants were rightly overruled. The only ground of demurrer now argued is that the remedy at law is adequate. The gist of the charge is the alleged continuing wrong of Thompson in selling his goods as those of the plaintiffs and the alleged continuing wrong of Thompson and of Laganas in fraudulently using the Laganas patent as a shelter for Thompson in injuring the plaintiffs' business. The bill is not based upon defamation as in Boston Diatite Co. v. Florence Mfg. Co., 114 Mass. 69, 19 Am.Rep. 310, but upon continuing injury to the plaintiffs' property rights by unfair practices. Lawrence Trust Co. v. Sun-American Publishing Co., 245 Mass. 262, 139 N.E. 655;Sherry v. Perkins, 147 Mass. 212, 214, 17 N.E. 307,9 Am.St.Rep. 689;Aronson v. Orlov, 228 Mass. 1, 11, 116 N.E. 951. Clearly the remedy at law is not adequate. Summerfield Co. of Boston v. Prime Furniture Co., 242 Mass. 149, 155, 136 N.E. 396;Maytag Co. v. Meadows Mfg. Co. (C.C.A.) 35 F.(2d) 403, 408.

There was no error in overruling the defendants' exceptions and in confirming the master's reports. The master was not required under Rule 90 of the Superior Court (1932) to append to his report brief, accurate and fair summaries necessary to determine whether the evidence was sufficient in law to support his findings, because the stenographers had not been selected or approved by him in accordance with the rule. Administering an oath at the request of one counsel or the other to a stenographer whom one of the parties has brought to the hearing is not the equivalent of such selection or approval. The attention of the master should be plainly called to the fact that he is asked to act under and for the purposes of the rule. Statements out of court by persons in the shoe repairing trade tending to show anxiety because of the ‘warning’ and unwillingness to deal with the plaintiffs for that reason were competent. Brannen v. Bouley, 272 Mass. 67, 72, 172 N.E. 104;Malloy v. Carroll, 287 Mass. 376, 392, 191 N.E. 661, and cases cited. Evidence bearing upon injury to the plaintiffs' business, good will and credit and evidence tending to show the quality of the plaintiffs' machine was competent. Some evidence of possibly doubtful competency was admitted without abjection, and some was stricken out or disregarded. If any stray questions or answers which were incompetent were admitted and allowed to stand, we are satisfied that they were either wholly harmless or too inconsequential to have affected the findings. Some of the objections rest upon alleged evidence not reported. Baush Machine Tool Co. v. Hill, 231 Mass. 30, 41, 120 N.E. 188. Failure to find facts desired by a party is not a proper ground of exception. Warfield v. Adams, 215 Mass. 506, 519, 102 N.E. 706;Carleton & Hovey Co. v. Burns, 285 Mass. 479, 483, 189 N.E. 612.

Recommittal to the master for the reasons set forth in the two motions which were denied, in so far as it would have been proper at all on the grounds there stated, was discretionary with the court. The facts stated in the motions are not shown to have been proved. Petition of Koch, 225 Mass. 148, 150, 114 N.E. 79;Epstein v. Epstein, 287 Mass. 248, 253, 191 N.E. 418;Pearson v. Mulloney (Mass.) 194 N.E. 458.

The findings of the master do not in all respects support the allegations of the bill. Vital findings are in substance these: In August, 1931, Thompson was already manufacturing a press of the general type mentioned in the bill. Russo then began selling the Thompson press under an arrangement with Thompson. In the course of this work Russo became aware of defects in the Thompson machine and made to Thompson suggestions for its improvement, which Thompson did not adopt. Thereupon Russo developed a machine of his own. This Russo machine was quite different from the machine which Thompson was selling and was a great improvement upon it. In August, 1932, Russo ceased selling the Thompson machine. In October he offered his own machine on the market. In June, 1933, Thompson offered a machine, ‘which was almost the exact duplicate of the Russo machine.’ Its appearance was so like that of the Russo machine that they ‘cannot be differentiated except by a careful comparison.’ The master finds ‘that it is a copy of the Russo machine with certain nonessential minor differences.’ In February, 1931, Laganas obtained a patent for a machine which differed in appearance from the Thompson and Russo machines, but which made use of somewhat similar principles to accomplish results in part similar. Laganas contended that the Russo machine was an infringement of his patent. He gegotiated with the plaintiffs with a view to licensing the plaintiffs, but the plaintiffs finally declined. Thereupon Laganas licensed Thompson under the Laganas patent. In August, 1933, the so-called ‘warning’ was published to the trade. This ‘warning’ contained a picture of the Thompson machine, which was a copy of the Russo machine. By inference it represented that the machine depicted was protected by the Laganas patent, that similar machines (which of course included the Russo machine) not purchased through Thompson, the licensee, were infringements, and that infringers would be prosecuted. This publication damaged the plaintiffs' business. Thereafter the plaintiffs and Thompson continued to compete, each claiming to the trade tha the other was selling wrongfully. ‘Thompson was not acting in good faith at any time’ during this period. He had copied the Russo machine belonging to the plaintiffs and was endeavoring to sell his copy to the trade ‘in competition with the Russo machine at a less price and by statementsthat it was the equal of the Russo machine, and in one instance his salesman did palm it off on one customer as the Russo machine itself. * * *’ Thompson intended to injure the plaintiffs by his part in the ‘warning.’ Laganas acted in the exercise of good faith...