WOLF MINERAL PROCESS CORP. v. MINERAL SEPARATION NA CORP.

• Decision Date: 08 August 1925
• Docket Number: No. 286.,286.
• Citation: WOLF MINERAL PROCESS CORP. v. MINERAL SEPARATION NA CORP., 7 F.2d 903 (D. Md. 1925)
• Parties: WOLF MINERAL PROCESS CORPORATION v. MINERAL SEPARATION NORTH AMERICAN CORPORATION.
• Court: U.S. District Court — District of Maryland

7 F.2d 903 (1925)

WOLF MINERAL PROCESS CORPORATION v. MINERAL SEPARATION NORTH AMERICAN CORPORATION.

No. 286.

District Court, D. Maryland.

August 8, 1925.

Jacob F. Murbach, of Baltimore, Md., William M. Chadbourne, Leonard A. Watson, Willis B. Rice, Clinton De W. Van Siclen, and Carroll R. Ward, all of New York City, and Alfred H. Phillips, of New Haven, Conn., for plaintiff.

Venable, Baetjer & Howard, of Baltimore, Md., Henry D. Williams and William Houston Kenyon, both of New York City, Lindley M. Garrison, of Jersey City, N. J., and Edward Thomas, of New York City, for defendant.

SOPER, District Judge.

Twenty years ago an important invention was made in the art of metallurgy relating to the separation of the metallic substances in pulverized ores from the nonmetallic constituents, consisting of quartz or rocky material, called gangue. In the prior art, ore concentration in actual practice consisted of water or gravity concentration, wherein, under different conditions of agitation, the separation of the quicker settling particles from the slower settling particles was effected. It was also well known that oil and oily substances had a selective affinity for minute particles of metal found in crushed ores, but would not unite so readily with the gangue. Several unsuccessful efforts had been made to utilize this characteristic of oily material, in which varying amounts of oil had been employed; but the only oil process which had been used in commercial practice was the Elmore process, wherein a flowing pulp of water and crushed ore was mingled with oil in the proportion of one to three tons of oil to a ton of ore, and the metalliferous particles floated to the surface by the buoyancy of the oil. This process was used with technical success at several mines, but was not commercially profitable, because of the cost of operation, in view of the loss in oil, and the inability of the process to treat minerals in a fine state of subdivision, called slimes. Since these contain a substantial percentage of metal, a process which fails to treat them is impractical.

The processes in which oil was then employed were roughly divisible into two classes. In the first class was the surface flotation process, of which the Elmore was the chief example. The other class was known as the metal sinking process. Its chief example was the Cattermole process, in which the oil used varied in extent from 4 to 10 per cent. of the metalliferous matter. In this process, the small metallic particles were coated with the oil and concentrated into granules, which were heavier than water, so that they would sink to the bottom of the containing vessel, permitting the gangue to be carried away by an upward flowing stream of water. This process had great advantages, since the amount of oil employed was relatively small, and it was also possible successfully to treat slimes. Indeed, in the year 1905 the Cattermole process had been reduced to practical form in Australia, where a plant of commercial size had been erected for business operations.

Just at this time the process covered by United States patent No. 835,120 of 1906 to Sulman, Picard and Ballot, and by the corresponding British patent, No. 7,803 of 1905, was invented. It consists of the use of a minute amount of oil, amounting to a fraction of 1 per cent., on the ore, and beating air into the mass of ore and water, so as to cause the formation of a froth of a particularly coherent character, composed of air bubbles containing only a trace of oil, whereby a very high percentage of the metal in the crushed ore is carried to the surface of the mixture. It is obvious that such a process is not of the metal sinking class. It also varies substantially from the surface flotation process already described. The lifting force which separates the particles of metal from the gangue is not found in the buoyancy of the oil used, but in the buoyancy of the air bubbles introduced into the mixture by an agitation greater than that which had been resorted to in the prior art.

"The process was an immediate success. The record shows, not only that the process in suit was promptly considered by the patentees as an original and important discovery, but that it was generally accepted as so great an advance over any process known before that, without puffing or other business exploitation, it promptly came into extensive use for the concentration of ores in most, if not all, of the principal mining countries of the world, notably the United States, Australia, Sweden, Chile, and Cuba, and that, because of its economy and simplicity, it has largely replaced all earlier processes."

The invention and the prior art were thus described by the Supreme Court of the United States in the case of Minerals Separation, Ltd., et al. v. Hyde, 242 U. S. 261, 37 S. Ct. 82, 61 L. Ed. 286. The validity of the patents covering the process was vigorously assailed, both in the United States and in Great Britain, but was sustained by the courts of both countries, as will appear from the following citations: Minerals Separation, Ltd., v. Hyde, 242 U. S. 261, 37 S. Ct. 82, 61 L. Ed. 286; Id. (D. C.) 207 F. 956; Id. (C. C. A.) 214 F. 100; Minerals Separation, Ltd., et al. v. Butte & Superior Mining Co., 250 U. S. 336, 39 S. Ct. 496, 63 L. Ed. 1019; Id. (D. C.) 245 F. 577; Id. (C. C. A.) 250 F. 241; Id. (D. C.) 274 F. 878; Minerals Separation, Ltd., v. Miami Copper Co. (D. C.) 237 F. 609; Id., 244 F. 752, 157 C. C. A. 200; Id. (D. C.) 264 F. 528; Id. (D. C.) 268 F. 862; Id. (C. C. A.) 269 F. 265; Id. (D. C.) 275 F. 572; British Ore Concentration Syndicate, Ltd., v. Minerals Separation, Ltd., 25 R. P. C. 741; Id., 27 R. P. C. 33; Ore Concentration Co., Ltd., v. Sulphide Corporation, 31 R. P. C. 206; Id., 31 R. P. C. 214.

The present owner of United States patent 835,120 is Minerals Separation North America Corporation, the defendant in the case at bar. The suit was brought on April 10, 1922, 17 years after the froth flotation process was made known to the world. The plaintiff is Wolf Mineral Process Corporation, which is the present owner by assignment of United States patent 787,814, issued to Jacob David Wolf on April 18, 1905. There are two causes of action in the bill of complaint. The first charge is that the defendant has infringed the Wolf patent, and, in addition, that the defendant has licensed other persons to use the process covered by United States patent 835,120, although, as the defendant knew, that process requires for its successful operation the use of the Wolf patent. Such infringement, the bill charges, has in fact taken place under instructions given by the defendant.

The second cause of action is based upon a charge of fraud. The plaintiff alleges that United States patent 835,120, although registered in the name of the defendant, belongs in equity to the plaintiff. This claim is based upon a contract of February 5, 1903, between Jacob David Wolf, the plaintiff's assignor, and the firm of Sulman & Picard, two of the three joint inventors of United States patent 835,120. Briefly stated, the claim is that Sulman & Picard were employed by Wolf to investigate a process invented by him for the separation of minerals from their ores, and to improve the process, and deliver to him detailed reports of all discoveries made during the course of the investigation; that Wolf fully performed the contract on his behalf, and that Sulman and Picard partly performed the same by making tests and certain reports thereof to Wolf, and by assisting him in the application for the patent in suit, but that they broke their contract by concealing from him, and by communicating to others, the results of certain experiments, and by permitting Sulman, Picard, and Ballot to apply for defendant's patent, 835,120, which is based upon the experiments, and therefore belonged in equity and good faith exclusively to Wolf. By various assignments the defendant got record title to the patent, but received it, it is charged, with full knowledge of the fraud.

The answer admits the granting by the defendant of numerous licenses under its patent, but denies the charges of infringement and of fraud. It also sets up the affirmative defenses, or stare decisis, res adjudicata, and laches, more fully described below.

It will be convenient, first, to consider the second cause of action. It is not claimed that Wolf himself devised the flotation froth process, in which the metal is lifted to the surface of the liquid by the buoyant force of air, but that he conceived the idea of reducing the quantity of oil theretofore employed in the Elmore and other oil flotation processes, by increasing the degree of violence of the agitation of the mixture; that in the experiments in which this idea was applied by Sulman and Picard a float was produced, containing metal which was lifted, not only by the buoyant force of oil, but to a very large degree by the flotation power of air bubbles which the agitation necessarily formed; that Wolf, being ignorant of the scientific laws underlying the process, did not recognize the significance of the experiments, but that the chemists did recognize it, and in violation of their trust concealed the discovery from Wolf, and subsequently developed it for the profit of themselves and their chosen associates.

Wolf was a promoter, residing in London, interested in oil and mining properties. He had no technical knowledge of metallurgy, but perceived the profit to be derived by one who might solve successfully the problems of ore concentration. Learning that the Elmore process was commercially impracticable, he conceived the idea, according to his testimony, that if the pulp were violently agitated, so as to break up the oil into very small particles and bring them into intimate contact with the ore, the work might be done with a smaller quantity of oil. In the latter part of 1901 he discussed this idea with Sir Frank Crisp, a...