Thomson-Houston Electric Co. v. Bullock Electric Co.

• Decision Date: 03 May 1900
• Citation: 101 F. 587
• Parties: THOMSON-HOUSTON ELECTRIC CO. v. BULLOCK ELECTRIC CO. et al.
• Court: U.S. District Court — Southern District of New York

101 F. 587

THOMSON-HOUSTON ELECTRIC CO. v. BULLOCK ELECTRIC CO. et al.

United States Circuit Court, S.D. New York.

May 3, 1900

Frederic H. Betts, for plaintiff.

George J. Harding, Clifton V. Edwards, and Wm. Houston Kenyon, for defendants.

WHEELER District Judge.

This suit is brought upon patents Nos. 283,167, dated August 14 1883, for a magnetic field in an electric switch, to dissipate the arc found by breaking the circuit, and 401,085 dated April 9, 1889, for a shield of insulating material to control the place of the arc, granted to Elihu Thomson, and owned by the plaintiff. The defendant the electric manufacturing company is a corporation of Ohio. The defendant the electric company is a firm in New York, having offices at 220 Broadway.

The act of March 3, 1897 (29 Stat. 695), provides:

'That in suits brought for the infringement of letters patent the circuit courts of the United States shall have jurisdiction, in law or in equity, in the district of which the defendant is an inhabitant, or in any district in which the defendant, whether a person, partnership or corporation, shall have committed acts of infringement and have a regular and established place of business. If such suit is brought in a district of which the defendant is not an inhabitant, but in which such defendant has a regular and established place of business, service of process summons or subpoena upon the defendant may be made by service upon the agent or agents engaged in conducting such business in the district in which suit is brought.'

The bill alleges infringement in this district by sale of machines by the electric company, as Eastern agents of the manufacturing company, and service was made upon the firm as such agents. The manufacturing company has pleaded that it ought not to be held to answer, because its factory is in Ohio, and that it has no established place of business with the electric company, engaged in conducting such business as its Eastern agents, or in this district or state. The plea has been traversed, and proofs have been taken which show that the business between these defendants is done under an agreement in writing by which the manufacturing company grants to the electric company the exclusive right in the New England states, New York, New Jersey, Pennsylvania, Delaware Maryland, and the District of Columbia for the sale of such machinery, appliances, and material as the manufacturing company might manufacture, on the basis of discounts from the published list or lowest selling prices f.o.b. at Cincinnati (payments to be made in 30, 60, and 90 days from date of shipment), which the electric company would handle exclusively within the territory; the manufacturing company to do the general advertising, and furnish all catalogues and other descriptive matter; and the electric company to have the privilege of returning for credit any part of the consignment stock, they being charged with whatever should be necessary for putting the stock in the same condition as when it left the manufacturing company's hands. Making, using, or selling for use, would be an infringement; and the sale for use by the electric company in New York would, of course, be such. If the manufacturing company should do no more than to sell to the electric company in Ohio, that would be an infringement ending in Ohio. But the manufacturing company does more. It controls and participates in sales in New York. Its property does not pass absolutely to the electric company in Ohio, for the latter has a right to return it before sale. So the manufacturing company essentially promotes and actively participates in the sales in New York, when made there by the electric company for use. The title of the manufacturing company first absolutely passes by that sale for use, in which it participates through the electric company. ...