Temco Mfg. Co. v. National Elec. Ticket Register Co.

• Decision Date: 21 June 1929
• Parties: THE TEMCO MANUFACTURING COMPANY, APPELLANT, v. NATIONAL ELECTRIC TICKET REGISTER COMPANY, WILLIAM L. SULLIVAN, FRANK J. NEVINS, WILLIAM L. PEABODY, AND WALTER S. NEVINS. [*]
• Court: Missouri Court of Appeals

18 S.W.2d 142

223 Mo.App. 420

THE TEMCO MANUFACTURING COMPANY, APPELLANT, v. NATIONAL ELECTRIC TICKET REGISTER COMPANY, WILLIAM L. SULLIVAN, FRANK J. NEVINS, WILLIAM L. PEABODY, AND WALTER S. NEVINS. ^[*]

Court of Appeals of Missouri, St. Louis

June 21, 1929

Appeal from the Circuit Court of the City of St. Louis.--Hon. Henry A. Hamilton, Judge.

AFFIRMED.

Judgment affirmed.

Hugh K Wagner for the appellant.

Foristel Blair, Mudd, & Habenicht of counsel.

Smith & Pearcy and Rodney Bedell for defendants.

(1) The appeal in this cause is prematurely taken. There is no final judgment as the cause is still pending before HON. HENRY A HAMILTON, Judge of the St. Louis circuit court. His judgment, entered upon the order to show cause, was against the plaintiff and not against the defendants punishing them for contempt. Secs. 1469, 1963, 2359, R. S. Mo. 1919; McNealey v. Rause, 264 S.W. 383; State ex rel. v. Bland, 189 Mo. 197. The order entered in this cause refusing to punish defendants for contempt is not an interlocutory order from which an appeal will lie on the part of the plaintiff. Sec. 1469, R. S. 1919. Unless the right of appeal is given it does not exist. Nathan v. Planters Oil Co., 187 Mo.App. 560; Tamblin v. Lead Co., 161 Mo.App. 296, 299; State ex rel. v. Bland, 189 Mo. 197. The denial by the trial court of plaintiff's request for the punishment of defendants for contempt was only a step in the case which is still pending before the St. Louis circuit court and the referee appointed thereby. Plaintiff's appeal should be dismissed. (2) He who would have equity must do equity. Rollman v. Universal, 238 F. 568; Mastin v. Halley, 61 Mo. 196, 202. (3) He who comes into equity must do so with clean hands. A contract to carry on litigation against a third party for the benefit of the contractors is inequitable. Intimidation of competitors in advance of adjudication is inequitable. Pomeroy's Equity Jurisprudence, sec. 1276; Gregerson v. Imlay, No. 5795 Fed. Cas.; Keiper v. Miller, 68 F. 627; Panay v. Aridor Co., 292 F. 858; Ryan v. Miller, 236 Mo. 496, 509. (4) The laws aid those who are diligent, not those who sleep upon their rights. Laches will prevent any action by a court of equity. Mackall v. Casilear, 137 U.S. 556; Matheson v. Hanna-Schoellkopf Co. et al., 122 F. 836; Wilson v. Railway, 120 Mo. 45; Perry v. Craig, 3 Mo. 516, 528; Smith v. Clay, Ambl. 645; Temco v. National, in U.S. District Court at St. Louis. Decided September 28, 1928. (5) This court is without jurisdiction to determine infringement of a patent or to enjoin the manufacture of a machine which, in itself, is not the subject of a contract. Robinson on Patents, sec. 855; Gayler v. Wilder, 10 How. 477; Marsh v. Nichols, 128 U.S. 605; Standard Scale v. McDonald, 127 F. 709. (6) (a) The terms of a decree must be clear and must be plainly violated before a defendant can be cited for contempt. If there is any question as to the meaning of the decree or if there is any reasonable doubt of the violation there is no contempt. Saal v. South Brooklyn Railway Co., 106 N.Y.S. 996; Smith v. Halkyard, 19 F. 602; Bonsack Machine Co. v. National Cigarette Co., 64 F. 858; Accumulator Co. v. Consolidated Co., 53 F. 793; Schlicht v. Aeolipyle Co., 121 F. 137; Bullock v. Westinghouse, 129 F. 105; General Electric v. McLaren, 140 F. 876. (b) Judge JONES, in modifying the decree, attempted clearly to define exactly what the defendants were not to do. The decree as modified provided that the defendants were not to make, sell or use the machine which was the subject-matter of Sullivan's Application No. 712,113. This undoubtedly was done with the clear view by Judge JONES that in no case could the St. Louis circuit court try an infringement suit. The issue here involved is whether or not the machine manufactured by these defendants is the machine, the subject-matter of application 712,113. The evidence conclusively shows that it is not the machine, the subject-matter of this application. It is apparent that the United States Patent Office did not consider the machine which defendants were making as the machine, the subject-matter of application 712,113, since the Patent Office issued to Sullivan another patent, i. e., No. 1,145,818, on the machine which defendant company has been making. (c) The intention of Judge JONES was not to enjoin the defendants from manufacturing machines in accordance with Patent No. 1,145,818. Judge RULE, after conference with Judge JONES, informed these defendants that the decree was not meant to prohibit them from manufacturing machines under Patent No. 1,145,818. (7) Rulings on contempt are within the sound discretion of the court, and unless such discretion is grossly abused the decision must stand. In the court below Judge HENRY A. HAMILTON, after hearing testimony for over four days, and after submission upon full briefs and oral arguments by both sides, found in favor of the defendants quashing the rule to show cause why defendant should not be punished for contempt and discharging the defendants at the cost of the plaintiff. 13 Corpus Juris, sec. 169, page 105; Oswald on Contempt, pp. 230-232. (8) The machine manufactured and sold by defendant company, plaintiff's Exhibit 136, is not "the machine, the subject-matter of the Sullivan application Serial No. 712.113" (Patent 1,308,966). Robinson on Patents, secs. 459, 481, 504, 460; Prouty v. Ruggles, 16 Pet. 336; Burr v. Duryee, 68 U.S. 531; McClain v. Ortmayer, 141 U.S. 419; Boyd v. Janesville, 158 U.S. 260; Jones v. Munger, 49 F. 61, 65; Central v. Coughlin, 141 F. 91, 94; Ajax v. Morden, 156 F. 591; Portland v. Hermann, 160 F. 91, 99; Union v. Diamond, 162 F. 148, 156; Simplex v. Hauser, 248 F. 919.

SUTTON, C. Becker and Nipper, JJ., concur. Haid, P. J., not sitting.

OPINION

SUTTON, C.

This is a suit in equity for the specific performance of a contract. The suit was commenced on March 6, 1914. The contract in suit was executed on October 18, 1909. On that date defendant William L. Sullivan was employed by plaintiff in the capacity of an inventor, draftsman, and mechanic. When employed he was required to sign an employment contract, which is the contract in suit, whereby he agreed that plaintiff should have the right to all inventions relating to plaintiff's business which he should make while in the employ of plaintiff or on which he should file application for patent within three years after the cessation of his employment. While in the employ of plaintiff, Sullivan designed mechanisms which were made and sold by plaintiff, and executed patent applications for such mechanisms, and assigned them to the plaintiff. Plaintiff marketed these mechanisms through the Automatic Ticket Selling and Cash Register Company, and its predecessors and successors until October 1, 1914, when plaintiff terminated its relation with said Automatic Company. On October 19, 1911, Sullivan left the plaintiff's employ. He afterwards invented an electric motor driven ticket issuing machine, and within three years after the cessation of his employment with plaintiff, on July 29, 1912, filed application for patent thereon. This application, which is No. 712-113, resulted in the issuance of patent No. 1,308,966. In December, 1912 Sullivan with associates organized defendant National Electric Ticket Register Company. Said defendant company undertook to manufacture the machine described in said application, but could not make it operate reliably enough to be come a commercial proposition, and hence abandoned its manufacture some time in 1913. After the failure of this machine, Sullivan invented another ticket issuing machine embodying different operating mechanisms, and filed application for patent thereon, on October 26, 1914, over three years after he left the employ of the plaintiff. This application resulted in the issuance of patent No. 1,145,818. Defendant company manufactured and sold machines following the drawings and specifications of said patent No. 1,145,818. In November, 1914, the Automatic Company, which, as stated above, no longer had the agency for plaintiff's machines, entered into a contract with the defendant company to sell its machines, and was the exclusive distributor of its machines during the years 1915, 1916, and 1917. In 1918, the relations between the defendant company and the Automatic Company were terminated, and the Automatic Company began to manufacture a ticket issuing machine in competition with the machine manufactured and sold by defendant company. In this action, the court, by its decree, rendered on April 1, 1918, ordered the assignment to plaintiff of the invention constituting the subject-matter of patent application No. 712,113. This decree was rendered upon condition, however, that plaintiff should reimburse the defendants for their outlays in perfecting and patenting said invention, and appointed a referee for the purpose of determining the amount of such reimbursement and the amount of damages, if any, which defendants should pay plaintiff for withholding the assignment of the invention. The court, on July 8, 1918, made a further order enjoining defendants "from directly or indirectly making, selling, or using the subject-matter of the Sullivan application, serial No. 712,113, for United States Letters-patent." On July 15, 1918, the court vacated said injunction order, and in lieu thereof entered a more limited and specific order, enjoining defendants "from, directly or indirectly, making, selling, or using the machine, the subject-matter of the Sullivan application, serial No. 712,113, for United States Letters-patent, as said application, and the specifications and drawings contained therein, now stands in United States Patent Office. " On July 16, 1918, the day after the final injunction...