RAY
District Judge.
The
parties by stipulation have agreed upon the facts, which in
condensed form may be stated as follows:
I. The
Waltham Watch Company is a corporation of the state of
Massachusetts having its place of manufacture of watch
movements, etc., and its principal place of business at
Waltham in that state, and the defendant, Charles A. Keene
is a citizen of the state of New York, engaged in the
business of buying and selling watches and watch movements
etc., in the city of New York, state of New York.
II. The
complainant is the sole owner of United States letters patent
No. 527,771, to one Church for improvement in watch movement
frames, United States letters patent No. 677,689, to one
Ohlson, assignor to the Waltham Watch Company, for
improvement in spring barrels for watch movements, and United
States letters patent No. 556,303, to one Church for
improvement in dial holders for watch movements, and has been
since May 15, 1906. The said letters patents are good and
valid, and the several inventions set forth in said letters
patents are capable of conjoint use and have been so used by
the Waltham Watch Company, and watch movements made and put
out by said Waltham Watch Company, since May 15, 1906, and
known as '16 size Riverside Movements,' have each
embodied conjointly the inventions described in said patents.
The inventions embodied in the improvements constitute a
material and substantial feature thereof.
III.
Subdivisions 11 to 16, inclusive, of the stipulated record,
read as follows:
'(11)
Among the watch movements manufactured by the complainant
since the said 15th day of May, 1906, and for a long time
prior thereto by the complainant's said predecessor, is
and has been a model distinguished by the trade-mark
'Riverside.' Said trade-mark Riverside has been
continuously, uninterruptedly, and exclusively used by the
complainant and its said predecessor since October, 1876,
and has been stamped or engraved in a conspicuous place on
all such movements. Said watch movements so distinguished
by the trade-mark Riverside have been during the whole of
said period manufactured by the complainant and
complainant's said predecessor in several sizes, one of
said size being known as the 16 size Riverside movement,
and containing 19 jewels. Said trade-mark Riverside has at
all times since the 15th day of April, 1907, and for a long
time prior thereto, been and is duly registered with the
Commissioner of Patents of the United States, said
registration being in all respects in compliance with the
laws of the United States in that respect made and
provided. A copy of said registration is hereto annexed and
marked 'D.'
'(12)
Since said 15th day of April, 1907, many watch movements
bearing said trade-mark Riverside and known to the watch
trade and to the public as Riverside watch movements,
including many of said 16 size Riverside movements, have
been sold and used in said Southern district of New York
and elsewhere.
'(13)
Since the said 15th day of April, 1907, all watch movements
herein referred to as 16 size Riverside movements, and
which have embodied and embody conjointly the inventions
and improvements set forth in said three letters patent, as
well as other movements made by the complainant and
embodying other patented inventions and improvements, have
been sold and delivered by the complainant at its regular
established price only to wholesale dealers, known as
jobbers, and by said jobbers to retail dealers, only in the
following manner:
'All
of said movements have been sold and delivered in boxes
or packages, one movement in each box or package, each
movement being inclosed in an inner metal box or
container. Accompanying each movement and inserted in
direct contact therewith in said metal box or container
is a printed slip designated 'waltham Contract
Notice,' and in the case of each and every one of
said 16 size Riverside movements embodying the said
inventions made by the complainant, and which has since
the said 15th day of April, 1907, been purchased by the
defendant, the box or package containing such movements,
when received by the defendant, as the defendant then
well knew, also contained, as aforesaid, said Waltham
Contract Notice, of which the following is a true copy,
the blank space after the words 'movement No.'
containing the number corresponding with the number on
the movement it accompanied:
"Waltham
Contract Notice.
"16
size Waltham movement No. bearing the trade-mark
Riverside 19 jewels, essential parts of which are
protected by United States letters patent, is sold
subject to the following conditions, which every buyer
thereof by accepting this movement agrees with the
undersigned company to keep and perform, viz.: (1)
Jobbers may sell this movement to established retail
watch dealers, except those designated by this company,
and to no other persons, and only at the price and
discount authorized by this company. (The term
'retail watch dealers' shall include all watch
dealers other than those recognized as jobbers by this
company.) (2) Jobbers must in every instance deliver this
contract notice with the movement. (3) Retail dealers may
dispose of this movement by sale only, and only to buyers
for use and
not for resale and must not advertise nor sell this movement
for less than $25.00. A breach of any of these conditions
shall revest in the company the title to this movement and
upon tendering the price paid therefor to the holder thereof
the company may retake possession of the same.
"These
conditions will be enforced by the company.
"Waltham
Watch Company, "Waltham, Mass.'
'Said
contract notice being a true copy of the notice so used
from April 15, 1907, down to the present time, excepting
that on the 23d day of September, 1909, the price specified
in said contract notice was changed from $25 to $28.50. The
form of said box or package containing said 16 size
Riverside movements being identical in every respect with
the box marked 'Exhibit E,' which is hereby made a
part of this stipulation and is filed herewith.
'Subsequent
to the 15th day of April, 1907, in each instance where any
of the said 16 size Riverside movements have been sold or
furnished by the complainant or under its authority to
jobbers, there has been annexed to or printed on the
invoice rendered by the complainant to such jobbers in a
conspicuous place a notice designated 'Conditions of
Sale (Bill to Jobbers), ' of which the following is a
true copy, except that certain movements enumerated therein
other than the said Riverside movements were not included
in the notice issued on April 15, 1907, but were added
thereto after said April 15, 1907; said Riverside movements
having at all times been included in said notice:
"Conditions
of Sale.
"(Bill
to Jobbers.)
"Each
Waltham movement and Waltham watch in this bill is sold
subject to the following conditions and to those in the
Waltham Contract Notice issued with the movement or
watch, which conditions every buyer thereof by accepting
said movement or watch agrees with the undersigned
company to keep and perform, viz.: (1) Jobbers may sell
said movements or watches, to established retail watch
dealers, except those designated company and to no other
persons, and only at prices and discounts authorized by
the said company. (2) Must bill said movements or watches
only on billheads approved by said company and bearing
the Condition of Sale. (3) Must not bill said movements
or watches with any other goods. (4) Must not exchange
said movements or watches for any other goods whatsoever.
(5) The Waltham Contract Notice must be delivered with
the movement or watch in every instance. These conditions
govern the sale of the following movements; Vanguard, 18
size and 16 size; Crescent St., 18 size and 16 size; No.
845; Appleton, Tracy & Co., Premier; Riverside Maximus,
16 size, 12 size and 0 size; Riverside, 16 size, 12 size
and 0 size; No. 645; Royal, 16 size and 12 size; all
Colonial Series watches. (6) A breach of any of said
conditions shall revest in the company the title to all
movements of the grades named and all Colonial Series
watches in the possession of the violator and of any one
who shall have induced or knowingly participated in such
breach; and upon tendering the price paid by the holder
of such movements or watches the company may retake
possession of the same. (7) Jobbers must immediately send
to the company's selling agents a duplicate of every
bill of the above-named movements and watches which they
issue.
"The
undersigned will enforce these conditions.
"Waltham
Watch Company, "Waltham, Mass.'
'On
the 15th day of April, 1907, the complainant established a
schedule of retail prices, relating to said 16 size
Riverside movements made by the complainant, which prices
were contained on a printed slip or form designated
'Conditions of Sale (Bill to Retailers), of which the
following is a true copy:
"Conditions of Sale.
"(Bill
to Retailers.)
"Each
Waltham movement specified in this bill is sold subject to
the following conditions and to those of the Waltham Contract
Notice issued with the movement, which conditions every buyer
thereof by accepting said movement agrees with the
undersigned company to keep and perform: (1) All watch
dealers are to be considered retail dealers, except those
recognized as jobbers by said company. (2) Retail dealers may
dispose of said movements by sale only and only to buyers for
use and not for resale....
