Webster Co. v. Society for Visual Education
| Decision Date | 24 March 1936 |
| Docket Number | No. 5688.,5688. |
| Parties | WEBSTER CO. v. SOCIETY FOR VISUAL EDUCATION, Inc. |
| Court | U.S. Court of Appeals — Seventh Circuit |
Samuel W. Banning and Ephraim Banning, both of Chicago, Ill., for appellant.
Paul Carpenter, Whitman Taylor, and Henry Gifford Hardy, all of Chicago, Ill., for appellee.
Before EVANS and SPARKS, Circuit Judges, and BALTZELL, District Judge.
This appeal raises the question of venue of a suit under the Declaratory judgment Act, 28 U.S.C.A. § 400, and is taken from a decree sustaining a motion to quash service of process for lack of jurisdiction, and dismissing the cause.
Appellant set out in its bill of complaint that it was an Illinois corporation having its principal office and place of business in Chicago, and that appellee was a Delaware corporation, also having its principal office and place of business in Chicago; that jurisdiction rested on the Declaratory Judgment Act and on the fact that rights under certain specified patents were involved; that appellant was engaged in the business of manufacturing certain film slide projectors after an original design of its own, useful for advertising display and for educational work; that it undertook this manufacture and sale after receiving legal advice that the design did not infringe any outstanding patent and that the projectors were free and clear from the claims of the three patents in which appellee asserted its rights; that despite the noninfringing character of its projectors, and in violation of its rights, appellee had interfered with its business by notifying its customers of the alleged infringement and threatening suits. The relief prayed was that there be entered a declaratory judgment that the three patents of appellee were invalid and not infringed by appellant's devices, that appellant was fully entitled to manufacture and furnish the projectors to its customers without threats or other interference by appellee, that an injunction issue to prevent appellee from any further assertion of infringement by appellant to its customers, or any further threat of suit, and that appellant have judgment for damages in an amount to be fixed by a Master in Chancery to whom appellant prayed that the case be referred for an accounting. To its bill of complaint appellant appended two exhibits. The first was a letter sent by appellee's Chicago counsel to appellant, notifying it of the alleged infringement and threatening to file suit unless it promised within ten days to cease and desist the infringement and to account for previous infringement. The second was a letter sent by the same Chicago counsel to a customer of appellant located in Michigan, notifying it of the alleged infringement and of the above notification addressed to appellant.
Appellee filed special appearance for the sole purpose of pleading to the jurisdiction, and at the same time filed a motion to quash the service of process for lack of jurisdiction. The court, upon finding that it appeared from the face of the bill that appellant was a resident and inhabitant of Illinois, that appellee was a citizen, resident, and inhabitant of Delaware, and that jurisdiction was alleged to exist by reason of the Declaratory Judgment Act, entered its order sustaining the motion to quash service, and dismissing the cause.
Appellant assigns as error the failure of the court to find that appellee had by its acts waived the personal privilege of being sued in the state of its incorporation, and by such waiver subjected itself to the jurisdiction of the District Court for the Northern District of Illinois. The sole basis for the waiver contention lay in the two letters attached to the bill of complaint. Reduced to its simplest terms, appellant's argument means that because appellee had threatened to file suit against it, which suit would have to be filed in the Northern District of Illinois because appellant is an Illinois corporation having its principal office and place of business in Chicago, appellee thereby invoked the jurisdiction of the District Court for that district, and waived its right to be sued, if at all, for any matter arising out of the subject matter of the specific patents, in the district of its own residence.
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