910' REED
and others .SAH:E
V.LAWRENCE
and others.!
v·. CHASE .' and others.
(Oircuit OQurt, W. D.Michiga7i;, tJ. D. OC,tober 'i'erm, 1886.) to recover damages for the infringemept ofa patent, where supplementary account. of profits since the first accoUnting is ordered; the master may use oD'the second accounting, for all proper purposes, the record which he usedon,thefirs$ accol'lnting"without its heingput in evidence be· ,fore him. , 2 SUE-PttmCIPLE TO BE Al'PLmnlN ACCOUNTING FonPnOFITs. In a,suit for the infringement of a patent, the defendant is accountable only for'theJ sum: which represents that portion of the prOfits result.ing from the elIlployment .of"the patented devicesID the article by the de· fendal1t. If.the article mi!.de by him embodies the lise 'of other valuable features; 'riot patented to the cOmplainant, but which have contributed to its marof ketable'Value, the defendant IS not liable to the complainant for such features; and the.burden, is tlDthe complainant ttl show what portion of defendant's).,:protlts aroseLfr9tn: the .Use I)f complaina.nt's patent. .' . ,.: . , I : I' ; ' ,
Ina
a
.
:
lllYWard BOOB, for complainants. . Edwa,rd8Jc.Stewart and J. 11. Bennett, for defendants. ,r ',,: '_, . ' " _ ·
! ;",.' i '"
,.
i
I
lSee Chase v. Tuttle. 27 Fed. Rep. 110.
91ft
F:&PERAI,. REPORTER.,
the court allowed a suspension of the injunction pending an appeal by the defendants'on their;giving bonds, which was done. The above-mentioned decree was made June 30, 1882. In pursuance of the order for an accounting, the parties :went'before the roaster, and produced their proofs, an,d. he made a ,report,awarding the, sum of $--. This report, so far as' it IS necessiuy to particularize, proceeded on the grounds Iiablefor the whole profits derived by them that thedefelidants from the nlatitifacture of and the sale thereof,and some supplementarydamageR to the complainants, which to be in all $5.42 for eMh harrow.' Dther details of his report:are 'omitted for the to the main point in sake of brevity,and because they are controversy.' , "" . 'Exeeptions ·were.' filed" to the report ,by the ,defendants. ,They were brougpt on, befofe.Tudge principal exoeption, which i5 also overruletl, iilnddth'neport'confirmed. It is clear that this. order of, confirnll1tion! adgpted itS iti! ... which the . master had proceeded, namely, that in SUCh 'a case the complaiilant is what the proofe to have been entitled to recover from the which the profits of the 4e.fendant realized by involved the infringement of complainants' patent, 'as well as the sum which, W9uld equal th,e profits complainants might Qllivlln;wde pn,thqsame numb,er ofharrpws. All ppinion Was preparea and filed by JUdSI1 which, in substapce, ,deClat'yd ,that rule ap": plicable tp, the t.be Jearnedjudge t.a,Jdng the ;vie'!,'apparently tIle })4tent lH:ld) It was one Whlch gave thewhole value to the harrow, as distinguished from one which gives an increased otherwise, in, measure, valuautility to. ap. implement or pIe for the,gelleralpurpose it is d,es1gned. 1 shall, iri a sUDseqUEjnt pl/lice, refer to that ,particularly;. i " ',' ./1'he late Circ\)it haviug, at the Qy.ten<;1ant's insta,nce, such rehearing prdered a rehellring.of the original causes on,thE;! was ,pad before, the lIon. S';\'ANLE1 MATTHEWS, the'l:lssociate ju'stice of the supreme court allotted to this circuit, sitting alone.' On ,elaborate 8J;gument, .the; interlocutory dl;lcree entered on the' former hearing was c,onfirmed, the order injunction was. withdrawn, an ubfrom the date of the termination of the firstacC01.ll1ting up to the, dllte of the rehearing wl¥J a pernla,nentinjul1cti9ll was direqted to issue. 25 Fedy Rep. ff4.· The court also; iIi'this confirmaf,Qry decree, prderedincidelJ,tally the 1>Y the Cq1,lrt on the lam adviSE!d, and it is gtperwise enough, the rehea.ring noqllestioninvolved in the accounting was discussed, or alluded to, and consequently lio s,ideration was gi",en to ,questi9n, and this part of the decre'e. blling assumed to have been alreaqy· dispo,sedof, was, ertered therein sub aile:n,tio.. The court'is also apprised that defendants 'l1ave appealed to the supreme court from the decree made on the 'rehearing on the merits. ,;:.
REED V. LAWRENCE.
911
Pursuanl t6theorder for accounting' for the damages and profits ing theint'etval'betweenthe two hearings ofthe causes, the parties have been again before' the: master, and, upun some additional proofs, of'a like character, however; to those employed on the 'former and the proofs then offered, as well 'as the original record in the case', the master, relying upon the same grounds as before, has reported in favor of the complainants, and against".Chase, Taylot & Co., for the sum of$23,7t2.34, and against Lawrence & Chapin in the sum of$13,958.26; being fot th El sum of $5.42 for each harrow manufactured and sold by thenl, respectively. This report is excepted to on the same grounds, sub: before,but, as these grounds'merge into one principal' 8tantia11y; " . '. question, I shall notice but one other. Some question was made at the hearing whether the originaJ!:tecOi'd wltS bef6're the' master, so that he could take c6gnioo.ncEfof it without its being put iIi' evidence before him, which it wallcl8im.ed'was 'not dorie;' acnd it waS 'argued by defendants' counsel that the 'master could not refer his report. No Rutborities are cited dn,this to or C'onsidel'it point.:;t am;'however, of the opinion that the master is ll.tliberty't6 do this for'any1egiHmatepurpose in preparing his report, ·and no nous uSe is shOwn to have been made. ' "i," , The principal question,recurs, which is whether the report excepted and profits toiS.ffoundedon the true doctrine in relation to the inpliteti't causes Circumstanced as these are; or whether, 011 ,the other a principle which is ineq'uitable and unjust. 1 am harid, unable to see: that the question thus presented is tnany respect different frorri>t;hat'which waspresertted to Judge W1Tlt];}Y' upollthe 'forlner .accoullmngi 'and it has beetisttongly urged by counsel for thafthe court ought now to follow in his footsteps, a:nd matter -as a thitig at\iudged. And I feel the force of the argument; fouIided on the in theaetion ofthe court, if opP,osite results,li,rearrived at on thi:lse sllccessive stages in the same proceedings. But, on the other remenlbered that the causes still remain within the -eontt<?l of the courtithat no final decree has .yet been renderedjllnd that there still remains opportunity to the court,to set the pa,rties right, if matters have taken a direction, for I cannot but think the appeal supreme court is premature, and that I which has been taken to must treat;the cases as pending here. Profound and sincere as my reilpectts for the memory of Judge WITHEY-,and his legal learning and good judgment, it is notc<:lUsistentwith my sense of duty that t should abdicate the Junction of exercising my independent judgment, or refuse w'\;juitors,on the score of mere sensibility, the equitable rights to which the oonscience of the court thinks them entitled. For though I am quite ,conscious of the fact that as the cases will undoubtedly go to the supreme ,court on the questions involved, and what is done at the circuit is in preparation to that end, my conviction is that I ought, so far as is in my power, to put them upon'the right cOlitse, so that not only what the court thinks should be the right result here'shall be attained, but the .cases put in such shape that, upon appear, the supreme court may have
918
FEDJilllAL REPORTER.
all tbemateri!j.lhefore it for· giving such judgmentas.thl,tt court 81)811 tindtobe just between theparties,whether it shall,llgree with or differ frot;ll thl'Jcourt below. Adding9ply that d,oubt, or even a sligbt ,ipclipatioI;l, of judgme:pt, would justify achapge in the ruling the former' accoun,ting, I .will no:w, proceed to examine the: question presented. ., Whatever uncertainty or confusi()n there may have ,been arising from the varyi,ng d!misions of the· subordinate courts, t.hesupreme court has now, by a settled course of decision,established the: principles which should govern the Qourt in estimlltipg the damagesandpr9fitsto be account6£l for, 11y the infringers: ,patent causes. 'l'he most generally ap" plicable rule is the one which, resting on the principleof compensatiQn forinjurY" ;Whic1;ldiUnS through all the branches of the law as administered @d party,declares that the defendant;. who is accountable for. .proli\tsarising ,frQm the infringement of the rights securedip, ,tb.;C9Plplainant by his patent, shall account to him for the sum ,reproElents that portion of the profits resultiqg frOm -the employment of 'tl)epf:'teqjj:lq devices in theaJ;ti(llemanufactured. by!the defendant. If the article embodies. the use of oth'ilr va,luable features n9t patented to the complainant, but which ha.ve contributed to its mark,et value, whether such other featurasl;\re patented to any other person or not, the defendantia not liable for th{l use of them to the complainants. If SQch ()tber .features are patented to some third party, person is thl1 one entitled tq for that in;fr,ingement,to ,tbeextent Which his Jtascontributedto the defendant's profits. .But if, on the other are nqt patented at alIt then the defendant, in Q!1S a right to. apply to hisbusinesa, and he can of .them.TheybeloIlg totlle common is no exclusive ri.gbt to ,them in any. Blakr-y; Rob- '. ertBon, 9411.s', 728; Cb-wood Black 12J;natchf. 2,O,l1lU., 8.122, .4 Sup. Ct. Rep. 32(i; Black v.Mu'l18on,.14 iJlis last, being, as I undersmnd, a branch of tIle: next preceding; Elimbe(lpv.,pavcrrumtCo., 97 U. S. 127; Garretao'fJ.V. Clark, HlU. 8.120,4 Sup.,Ot.}?,ep.291; Dob$oo v. Hartjord,C!arpet cp., 114 U. S. 439, 58up. 945. ., . ..... To these autlWl1i#es I ought to add Ttdtlev. Gaylhrd, 97, dicided only:; by JQdge in ,a Iitigation over the Oa1,"7 vel' pateIlt, on the same or a similar state oft}le evidence on the ing, i.n whichnoQ}inaI damages onlywe:re awarded.,. .' C<>rollary;totbil:lrule, but ruanifes,tly IlQ exception to, it, ,jsanotber one, thatw;ben, the patented featu,rewhich has beeninfringedbytAe defeIldllllt ;is, onew,hich the sale element of value in, the thing planu'" factllred, sotbat.buHorit not be marketable, because., Qsq(ul ,for which it was,intended, the fendant is liable profltsoftlle mal}Ufacture.Manufacturing awv. Cawi'llg,:,105 U. S. is an exce1J,ent illustrati9u of the distinction. .Andthe distinction)s'again pointed .0utinDobBoov. lJariford Oarpet. Co" 114U. S. 445, [) Ct. Rep. ,rule is
919 /tsplaillly just as the othel'. In both the essential principle is thce<aJ;l1o, ,yhich is to award to the injured party that redress which compensates for ,the violation of his right. In the first case, his right does not extend to the whole' manufacture; in the second, it practically does. .It is certainly alien to the principler;l of the court to inflict vengeance. Its aim is rather to administer justice upon strictly equitable principles; In the opinion of Judge WITHEY, and the consequent action of the court ill confirming the master's report, the second rule above stated was applied, and the ,court held in effect, as above stated, that the Garver patwas a primary one, and he held that those features of that patent which. had. been sustained by the court were the sole element of value in . the harrows manufactured and sold by the defendants which made them ,and bllt for which those harrows would. not, nor would any appreciable portion of them,. ha,vebeen sold. Now, as appears by the ion ofM!'. Justice MATTHEWS, and the decree entered thereon, the Garver patent was sustained in respect to two devices. namely, the spring-tooth attached to and circling over the frame, and downward and forward; to the point below the frame,apd also the peculiar method of the attachment of the tpoth to its seat upon the frame. This last deviee is not invol,vec;l in .UJ;e presentaccounting, because it is. not claimed that the def13ndantseJnployed it during the period over which the alJcounting eXThe feature,therefore, to which the present question of damages relates·. is. tAat of the spring-topth arching over the frll-l1;le, and ,with itS p.oint inclining forward under the frame. . is required to take j\;ldicial notice ofwhll-tis comtnonly. known The in ,bl::auchcs ,of mam;lfacture and iI).dustry. It is that the court should know what is the currentprogrllss in the llrtsa,ft'e,ctcoov,enience and methods in common use among the. people. PftiUip8 v. Detroit, 111 U. S. 6()4, 4 Sup. Ct. Rep: 1580; King v. Gallun, .1,09 U. S,. 3 Sup. Ct. Rep. 85; Terhune v. 99.U. S.5-92; ,B<tmvnv.Piper.,. 91 U. S.37. And, because this iSlso, the court is bound to know. What is :genetally known in this branch of busine8s; that, 'after the valuable improvemeilt introduced by the Garver patent in the uf::tctureof spnng"toothharrows, the great advantages of this class qf Implements genera.ll.,y recognized, and the business of manufl,l.cturiug harrpWis<with spring-teeth was entered upon in '!'arious parts of the <lountry,and by many individuals, so that the market was, and has ever since continued to be, filled with these harrows of various patterns, and rtll pnshed'lipon the public with a pertinacity which has become a recognized incident of all such kinds of business. A few of them cotitained this featUJ;oeof the Garver patent of the tooth arching over the framer but mored-td not. All, however, included the feature in some form of;the tooth, which ,takes the form of an arch in some portioll of conforIJ,lation, and is constructed of steel to give the desired .v:ibratory Illotion. :And the gCl:leraluse of these di.fferent patterns of is in pr()miscu.ous distrij:)utiou;throughoutthe country where such impler ments' are in ,demand. Sowe,have the same strn,cture of frame a,s the adopted; others have applied the spring
920
FEDERAL REPORTER.
of other' forms. A number of patents have been obtained, other than that of Garver, applicable to different devices in the building of such harrows,some of which the defendants claim to own,and to have used in the manufacture of the harrows 'now to be accounted for. How can it be said, iuthe light of all these well-known facts, of which notice must betaken. and which are also shown in the main by the direct evidence in the cases,that the sales whichha¥e been made by the defendants, and the profits they have made, are solely to the value contributed to the harrows by the feature of, the arching tooth peculiar to the Garver pate,nt? It seems to me that td say this is to deny the general knowledge and experience. To say"that every purchaser would have bought harrow having the peculiarity of the Garver patent, and would ha.ve bought no other spring harrow, is impossible, without ignoring whatts constantly happening throughout the country. In my opinion, the language of the supreme courtin Garretson v. Clark and Dobsoo v'::OarjJet Co., mutatis mutandis, has a clear and positive application. :'.' In the first of these cases, the patent was for an improvement in the ffi'ethod and securing in place the movablejaw of a mop-head. The courtsaid·that, with the exception of this mode of clamping, mopheads like the plMntiff's had long been in use. Before the master, the plaintifl"had' proved the costo! hiidrnplements, and the price at which they were sold, and claimed the right to recover the difference as his damages. This rule was rejected; and, no other of damages being· 6ffered, .the plaintiffw!l13' allowed' only nominal damages. This FIELD, deaction ofiha circuit was sustained On appeal. livering the opinion of the court, said: "The tiilil on this subject is aptly stated by Mr. Justice BLATCHFORD in the court patentee,' he says, ·must in every case give evidence tending to separaUl oraoportion the defendant's profits and the patentee's damages between the 'patented feature and the unpatented features. and snch evidence must be reliable and tangible, and not conjectnralnor speculative; or an,d satisfactory evidence thatthe profits and he must shoW by equally be. calculated on the whole machine, for the .reason that the damages are entire value' ,/ftne whole machine, as a marketable article, is properly and legally attributable to the patented J features.'The plaintiff complied with neither part ofLtliisrule. He produced no evidence to apportion the profits or damages between the improvement constituting the patented feature and the unpliLtent4jld,faatures,of the mop, and the price at, which it was sold. And of course not be pretendelitbat the entire value of the mop-head was attributable to,tIle feature patented." I! I,' ':"
Of course it'Clin make no difference in the rule whether the unpatented features 'liVerein use before ohmly since the patent was obtained.. In eitheer co8e;'1he prtblic are entitled to use them, and the patentee, therefore, bashD right to recover damages which include such use. In the"other,case (Dob80nv.CaryetOo.) the patent was fora design in the manufitctlire of carpets, and the complainants sought to recover damages''td thea'tnount. of the difference between the' cbst of manufacture to him' and his selling price for the number of yards manufactured by
REED
11.
LAWRENCE.
921
the defendants. This was allowed by the court below, and substantial damageFwereawarded. On appeal, this part ofthe decree was reversed, and.only six cants damages allowed. Mr. delivering the opinion of the court, after taking judicial notice of what is common knowledge, that there is an infinite variety of patterns in carpets, and that between such as are of equal intrinsic merit, as to durability of fabric and color, and equally pleasing in pattern,some ibaving an unpatented design, but one protected by a patent, said it did not follow that the latter would necessarily command the la.rger price in the market.I'If it does, then the increased price maybe fairly attributed to the'design, and there isa solid basis of evidence for profits or damages. But short of this, under the rules established by this court; there is no such basis. The same principle is applicable as in patents for inventions. The burden is on the complainant,and to give the neeessary evidence, but resorts instend to inference, conjecture, and spe({ulatioh, heroust fail for waritof proof. There iabutonesafe rule,--to require the ·li.ctual damages or profits to be established by trustworthy proof," ' Again he says, at page 445: -"Approval ot the particular design or pattern ma.y very welf-be' :one tnot,ve tor pu!cb(tsmg the article containing it, but the article must :have intrinsic merits Of material and structure to obtain a purchaser, aside from tbepattern ord!l8ign; and to attrib\ltein law the entirj:\ pronttp the pattern. to the exmerits, .unlesl:! it is shown Qy evidence as a fact that the prpfits ouglit woe so attributed, violates the, statutory rules of actual damand of profits- tp be accounted for." ", " , :'l1ie pertinency of .this language to these cases in hand is so conspiC:uous that I need not dwell upon it. It is only necessary to makeihe doctrine concrete by applying it to spring-tooth harrows, and the .specific feature of the tooth' arching over the frame, of the Garver patent. The result is that I cannot doubt that the court erred upon confirming the former accounting,: and adopted the wrong rule in the computa.-tion of profits to be recovered. What the complainants seek now is,confessedly; the profits derived by the def£mdants in theidnfnnging business, though the reports seem to cover also damages to complainants; and they are .undoubtedly entitled to recover them I-not the whole profits of thebusiness,but such profits as they can show are attributable to the use by the defendants of their device claimed under the Gal'verpatent. But, while'the profits are what the complainants are now professedly pursuing., the rule would be the same if the inquest were one of damages to complainants, as, indeed, it should be; for the underlying principle is the same, and is not affected by the mode of redress elected. That this is 80 is very clearly indicated in the opinion of the supreme court in .VOb8<m v. Hartford Carpet Co., above cited. It appears to me to be clear that the other rule than that adopted by Judge WITHEY is the one applicable here, because the patent is not one covering the entire structure of spring-harrows. It does not include the frame which is used, that being substantially the old Scotch harrow frame. Nor does it cover springing teeth, except as they contain the
922
l<:EDI!:UAL
feature already Nor, to make the es:clusion short, qoesit cover anything else thap.. those peculiarities included in the claims! whiCh have been sustained, by the court as herein stated and :explained., .As' was: to be expected, the mastel'has, on this accounting; pro.ceededQll 'the principles laid down on the·firat;and it unfortunately happens that the record is in such shape that; the facts necessnry to ,oome to a rigM conclusion are 'not, in .viewof the opinion entertained ,o,n the law of the case, in proper Cit sufficient presellw.tion. Ifthepresentview is' right, and the supreme court should adopt it, it is to be,feared that the consequences of leaving matters in their present shape,aild confirming thh report. would be that, when the, cases should reach a' final determination in the appellate court,· that. court would be without ,the means ,afforded by the reCOrd of awarding that redress to which the complainants are 8!pparentlyentitled, and. be under the necessity of awarding them nominal: damages only; and, iilany.event,it is very clear'thaUhe mostprudebt c!lursewill be to sustain the present exception, and r,ec6mmitthe matter,.df reference to the, master, with instructions to take such additioilal evidence as the parties may see fit to and further report in conformity with,th.eprinciple of this opinion. I;n'this" way all the necessary will probably be brought before the coutt, :BO .that, whatever':view may ultimately he held as to the correctness1o£ the opinion now:expressed, as has already been said, the courtmaybe'able to accomplish justice' between thep/!-rties.This opinion is much longerthaJi 'would been had not felt it to be proper that the reasons which have compelled me to adopt a dif·' feient·conclusioo from that hitherto 'reached by the court should be fully stated, and With as much distinctness as was practicable. In the present situation, I should recommend to the parties that the order confirming the former report be opened, 'and that a like order be made in tha:l; matter as is directed in: this, for the objectS herein indicated as desirable; No motion of that kind is made, and I should prefer that the parties consent to that course rather than be compelled, when the final decree comes to be 'made,to' go b.ack and revise the earlier proceeding; for, as already indicated, the whole matter is yet within the control of the cburt, and it is its duty to correct any error which. it may conceive ithas fallen into. at any time before final decree and the subject has passed beyond its reach. PerkinBv. Fourniquet, 6 How.' 206; Fourniquetv. Perki7l8,16 How. 82;WoOBterv. Handy, 21 Fed. Rep. 51. Hauch consent is given, both may be included in one order.
nave
THE'C1TY OFSPlUNGFIELD.
923
, TfIE
C1TY OF SPltINGFIELD..
, '.PHESAMMm. LUTHER and, others v. THE CITY OF, 'l1.
dl; N. Y. TRANSP. (10.
THE SAMMm.
(lMirict OOuirt, S. D. New YOrk. January 81, 1887.) '1,. COLLISION...,.. :EAsT hlVER-TmE <.)'URbNTS - KEEPING' OUT OJ' THill WAy ..... SAFE! MARGIN, ,,
Aste:atp.el', 'Mund to keep out of the way, must, pe,ril, shape her C9\lrs,e ,ror a ,s.afe margin against the contingencies of naVigatIon, and theef· feetsof tide currents. Held, in this case,that theconfiict in the evidenee -,was probably in part to be explained by the westward set of the fiood·tide off Twenty.third street, which changed to the westward the course of the 8., a steamer 800 feet long, as she struck the current, and that the collision was by her fault only. SAJitl1j..l..TUG AND TOW-SunDEN BACKINcr-LINES PaTED -ERROROJ'JlJDG., rrhecollisi,on being with. a heavy <;ar-11oat in to'\v' along:side a' tug, and the S. contending that the fioat had' broken loose from the tug just before the col,lillion, through: the tug's too sudden batiking, which the tug denied, held that, eveni! the Unes were parted, as,alleged, before the collision, the tug's backing was made necessary by the fault of the 8. when the danger was imminent; tllal'the error, if there was any error, was one of judgment, under the exciuiment,of the moment. and not a 1ell:al fault. lIJlIl1!Q'T U'l: EXTREMIS NOT A FAULT., '
In Admiralty. E. D. McCarthy, for the Sammie. Wilcox, Ada'lll8 &: MacklJin,· for the City of Springfield. BIl.OWN,J. The collision in' this case occurred' at about half past 6 "inthemoming of November 19, 1885, in the East river, about opposite Eighteenth street, and not far from the middle of the river, between a 184 feet long, lashed upon the starboard side of the tug Sammie, bound up river, and the passenger steamer City of Springfield, bound down. The starboard bow of the steamer struck the starboard comer of the float, and each was somewhat damaged. There is very perplexing confiiotin regatd to many of the details of this collision. Many of them it is not necessary to notice. The,·tide was the last of the flood. The Sammie had passed the Tenth-street buoy in about mid-river,-that is, a little to the eastward of that buoy,-and, when at about Twelfth street saw'· the green light of the City of Springfield, which was at that time coming down between the black buoys, off street, having taken the westerly channel past Blackwell's island. The ferry-boat Rockaway was art!that time crossing the river, bound for her slip at Twentythird street. She gave a signal of two whistles to the City of Springfield, whioh the latter answered With two whistles, and starboarded her Wheel, g-Oing. under the ferry-boat's stern about opposite Twenty-third Two whistles were about that time given to the ferry-boat