Stitzer v. Withers

— 183 — OPINION by Judge Settle- — Reversing. By the decree appealed from in this case appel-lee was adjudged to he the owner of an undivided half of patent numbered 732,232, for a portable horse stall, issued to the- appellee by the United States in November, 1902; the judgment being based upon an alleged assignment claimed by appellee to have been made him by appellant by written instrument of date August 16, 1899. It appears that appellant in 1897 secured a patent, No. 591,792, for a “knock-down horse stall” of his own invention. In 1899 he invented and secured a patent, No. 629,726, for a portable horse stall designed for shipping horses on cars. Before the last patent was issued appellant assigned all of his interest in No-. 591,792, except an undivided fifth, and by writing of August 16, 1899, he assigned to appellee a one1-tenth interest in patent No. 591,792, and a one-half interest in patent No. 629,726, and also similar interests in any improvements that might be made by appellant on these two patents. The particular clause of the assignment upon which appellee rests his claim is as follows: “Also a similar interest in and to any and all improvements which I may hereafter make on either of the above patents named, that is I assign and transfer unto the said James A. Withers an undivided one-tenth interest in all improvements I may make on patent issued to me on July 25th, 1899, known as No. 629,726.” It appears from the pleadings that appellee’s claim is that patent- No. 732,232, in which he was adjudged a half interest by the chancellor, is but an improvement upon patent No. 629,726, and that, whether this is or not true, by contract between himself and appel — 184 — lant made before patent No. 732,232 was secured by the latter it was agreed that it should be deemed an improvement on patent No. 629,726 within the meaning of the writing of August 16, 1899. The defense interposed by appellant’s answer is that patent No. 732,232 is not an improvement on patent 629,726, but that it is an entirely new, separate, and distinct invention, and that there was no agreement with appellee that it should be deemed such an improvement, but that he offered appellee a half interest in the new patent, No. 732,232, provided the latter would pay him (appellant) for his work in trying to improve- the old stall, as he had theretofore agreed to do, but had not done, and would pay him for the time he had spent- in constructing a full size- stall and model for the new patent and for the material used therein, and furnish money to- secure the patent and to develop the new stall and put it on the market. The conditions-, the answer alleges, were agreed to by appellee, and that he did in pursuance thereof pay appellant $55, but failed and refused to pay any more, and abandoned the agreement, though-repeatedly urged by appellant not to do so, by reason of which appellant was forced to seek assistance and money from others in order to construct his model and secure the patent thereon; that appellant offered to one G-. W. Wohlgamuth a half interest in his invention upon substantially the same terms theretofore made with appellee, which Wohlgamuth accepted, and after paying appellant in small sums- $88.75, in pursuance of their agreement, he, too, refused to pay more, and abandoned the undertaking, after which appellant succeeded in- enlisting J. B. McCormick in the last invention, and, McCormick having furnished — 185 — the capital necesary to reimburse him for his work and material in constructing the stall and model and to pay the cost of procuring the patent, appellant assigned him a half interest in the new patent upon the same terms he had offered it to appellee' and Wohlgamuth; that in November, 1902, the new patent, No. 732,232, wa.s duly issued to appellant, and shortly thereafter he and McCormick entered into a profitable contract with the American Express Company, whereby that company adopted the portable stall covered by patent No. 732,232 for use on their lines. The answer further alleges that after this contract was made appellee saw appellant and made claim to an undivided half interest in patent No. 732,232, and upon appellant’s, refusing to recognize such claim he' instituted this action to enforce it. It appears from the record that appellant, though a person of inventive genius, was without means to secure patents, or put his inventions upon, the market, and that this fact was known to appellee when he became interested in his inventions. In addition to the $500 which appel-lee paid for the one-tenth interest in patent No. 591-792, and a half interest in patent No. 629,726, he expended about $1,500 in developing No. 629,726. This money was mainly used in buying material for-and in constimcting about 70 portable stalls under patent No. 629726, some of which were put into cars and tested in shipping stock on different lines of railroad Appellant went to Memphis, New Orleans, and perhaps other places., in trying to introduce them, but it was soon discovered that the stalls- were not a success, and both appellant and appellee became satisfied that, unless some means of remedying the defects in the stalls could be found, they would prove — 186 — ■worthless. The testimony as to what occurred between the parties after this time is quite conflicting, but we think the weight of it tends to establish the fact that appellant was to devote bis talent and labor toward inventing some improvement of the portable stall covered by patent No. 629,726, that would, if possible, remedy its defects, and enable it to be placed upon the market as a useful and profitable invention, and to enable appellant to live while so engaged appel-lee was to allow and pay him a salary of $50 a month. Appellant did at once undertake to accomplish what was required of him, and on the first of the following month requested of appellee payment of his salary for the time he had then worked at the agreed rate of $50 per month. But appellee refused to pay him anything, saying he would be entitled to nothing until he had worked a full month. Thereupon appellant continued to work until the first of the succeeding month, when he again demanded of appellee his salary, Which the latter again refused to pay him, notwithstanding whic- appellant, though greatly in need of his salary, remained at work for perhaps another month, when he was paid in money a part of what was due him, and given an order for a small sum, and a few days later paid another small sum, the whole amounting to $50, only, one month’s salary, which seems to be all that he ever received from appellee under the agreement as to the salary to be paid him. We think the weight of the evidence further conduces to prove that after some months of effort to improve the stall in question appellant came to the conclusion it could hot be done, and that he would desist from further attempts to do so, and so informed appellee, who acquiesced in his decision, and that some months — 187 — after this decision appellant invented what Re claims is a new portable stall, w,holly distinct from that covered by patent No. 629,726, of which he informed appellee. "Whereupon another and a new agreement was made between them, based upon the conditions as to the furnishing of money by appellee for the purposes hereinbefore indicated, his compliance with which woul d entitle him to a half interest in the new patent. It appears, however, that only $55 of the money so promised by appellee was furnished by him. It also appears from the evidence that $35 of the $55 furnished by appellee under his last agreement was paid early in May, 1902, yet down to that time appellant had expended in constructing the new model alone $223. On May 12, 1902, appellant notified appellee in writing that the stall and modebwould he completed and ready for his inspection on the 17th of May, and on May 19th he saw and in person notified appellee that the stall was then complete and ready for his inspection. Appellee denied that either notice was received by him, yet he filed with his petition the letter containing the first notice. According to the evidence, appellant kept the stall set up and awaiting appellee’s inspection from May 17th to September, 1902, but the latter did not go to see it, or inspect it. In September, 1902, appellant, having secured the space necessary for the purpose, exhibited the stall at the State Fair held m the city of Louisville. Appel-lee was at the fair and met appellant there, hut did not inspect the stall or make any inquiry of appellant about it. Thus a period of about six months elapsed between the completion of the model and the issual of the new patent, during which appellee, though — 188 — twice notified of the necessity for action on his part, neither saw appellant, manifested any interest in the new stall, or contributed any money to develop it or assist in having it patented. It also appears from the evidence that the arrangement between appellant and Wohlgamuth was made during the fair, whereby the latter was to assume the undertaking abandoned by appellee, and take the same interest in the new patent to which appellee would have been entitled had he complied with his agreement made with appellant. Being disappointed by the failure of Wohlgamuth to comply with his undertaking, appellant entered into the contract with McCormick, whereby the latter repaid Wohlgamuth the $88.75 he had advanced appellant, and upon the same terms, that had been agreed upon between appellant and. appellee became a partner1 in the new invention, furnished the needed funds to develop and have it patented, and received from appellant an assignment of an undivided half interest in the new patent. We are satisfied that appellant would not have succeeded in perfecting the last invention, or in securing the patent upon it, but for the assistance of McCormick, and it is equally certain that but for the energy and business sagacity of the latter the profitable contract with the American Express Company for its use of the new stalls would not have been consummated. Frqm the evidence as a whole, we are convinced that appellee, on account of his expenditures and the apparent loss of not less than $2,000 in attempting to develop and improve patent No. 629,-726, came to the conclusion that appellant would fail upon the last invention, or, if patented, that it would — 189 — prove as unprofitable as the others, for which reason, and after paying $55 to forward the work upon the last, he resolved to expend no more money upon it, and therefore abandoned what he obviously thought a losing venture. If such had not been his decision, he would not have remained away from appellant through the months that followed, - or failed in his undertaking to furnish the necessary funds for pushing the work on the last invention or to have it patented. The awakening came, however, when he discovered that appellant had with the assistance of another, not only perfected his new stall and secured a patent on it, but that it was a success, and had been successfully put into use under a contract which gave promise of large profits. Under the facts presented by the record we think appellee’s abandonment of the contract whereby he was to receive an interest in the last patent estops him from relying upon that contract, for lie will not be permitted to repudiate the contract and yet receive the benefits, that would have resulted had he complied with its terms. So' if, as contended by him, that contract contemplated that the last stall invented by appellant should be treated as an improvement on patent No'. 629,726, though in-fact a new and distinct invention, the estoppel would nevertheless be1, and is, operative by reason of appel-lee’s abandonment of the contract. We now come to the consideration of the really vital question in the Case. Is patent No. 732,232 an improvement on No-. 629,726, or is it an independent and distinct invention1? If it is merely an improvement, then clearly appellee was entitled under the writing of August 16, 1899, to the relief allowed by the judgment appealed from, independently of any — 190 — subsequent agreement between liimself and appellant. Before the trial in the lower court of the case at bar it was before Chief Justice Hobson of this court, upon a motion to dissolve a temporary injunction granted by the chancellor. The motion to dissolve the injunction was sustained by the Chief Justice; his reasons therefor being stated in a written opinion, from which- we quote the following: “The real question in this case is, therefore, whether the last patent is an improvement on the preceding patents, within the meaning of the contract of assignment. In patent No. 629,726 the stalls were constructed with four-parts, each having four grooves in which the plank constituting' the sides and the ends of the stall were placed, the posts being held together by an iron rod tightened with a screw near the bottom and overhead by a timber extending from the top of one post to the other, and from the center of this timber a brace extended from the top- of the car. The trouble with this stall was that horses struck their heads against th!e overhead timber; thus seriously injuring them when from any cause frightened on the journey. Another defect was that the stalls consisted of so many parts, and took so- long to put them up. The last patent, No. 732,232, issued in November, 1902, used tubular telescoping posts which might be extended so as ho< be- set in the floor of the car and roof; thus doing away with the overhead timbers. The sides and ends of the stalls were fastened together so that they might all be set up at once, thus avoiding having so many pieces to be handled. The method of attaching them- to the posts was by hooks ■and rings-, and not by grooves, as in the former patent. The essential idea of patent No. 629,726 is in the — 191 — grooved, posts, and in the way they were fastened-together. The essential idea in the last patent (No. 732,232) is in the tubular telescoping posts and the method of fastening the other parts of the stall to them. A stall for a horse is necessarily a quadrangular box. It must under any device have posts and sides. Both patents are intended to accomplish the same result, and the same is true of every patent issued for portable box stalls. The last patent is not' an improvement on the former within the meaning of the patent laws, simply because it is designed for the same purpose, for, if this were true, then all patents for box stalls and the like would be but improvements on the first. The rule is that, if one invents only an improvement on a machine or other thing, he is not entitled to a patent on the whole machine or thing. Odiorne v. Winkley, Fed. Cas. No. 10,432. An improvement, as understood in the patent law, embraces the original and adds thereto or alters it. Page v. Ferry, Fed. Cas. No. 10,662. The assignment of an improvement gives m> interest in the original patent. Leach v. Dresser, 69 Me., 129; Foss v. Herbert, 2 Fish Pat. Case 31, Fed. Cas. No. 4,957. A device securing the same result, but operating on a different principle, is not an infringement of a former patent (Bridge v. Excelsior Mfg. Co., 105 U. S., 618; 26 L. Ed., 1191), and is not covered by an assignment of the patent with an agreement to assign all improvements made on it. Stebbins Hydraulic Elevator Co. v. Stebbins (C. C.), 4 Fed., 445; Puetz v, Bransford (C. C.), 31 Fed., 458; Jeffrey Mfg. Co. v. Ind., Electric Co., 83 Fed., 191; 27 C. C. A., 512; Id. (C. C.) Fed., 981. Under the record as presented the plaintiff has not shown such a state of case as warrants a — 192 — preliminary injunction which may be of great injury to the defendant * * *” We think the foregoing quotation from the opinion of .Chief Justice Hobson aptly presents the differences between patents Nos. 629,726 and 732,232, and readily proves tlxeir separate and distinct character, and the same is, we think, also' established by the weight of the testimony of the expert witnesses whose depositions appear in the ■record. It is a fundamental principle in the law of patents that, if one patent does not infringe another, it is independent of it. Prom the appearance of the models of the two patents shown us, as well as the testimony of the expert witnesses, we are convinced that the application of this test will demonstrate that the latter patent is not a mere improvement on the other, but a wholly distinct and independent contrivance. A number of cases besides those mentioned may be cited as illustrating the principle announced; one of the most notable being Stebbins Hydraulic Elevator Co. v. Stebbins (C. C.), Fed., 445. In this case the facts in brief were: That the defendant, Stebbins, was the owner of patent No. 132,111, of date October 8, 1872, for improvements in hydraulic elevators. On the same date patent 132,112, for improvements in safety devices for hydraulic elevators, was also' issued to him. In the following month Stebbins, and others associated with him, assigned these patents to the plaintiff, Stebbins Hydraulic .Elevator Company; the assignment containing this provision: “Together with the right to modifications, improvements or reissues thereof, and all other or similar patents in the United States which may be issued to us, or any one of us, directly or indirectly, in or of, or in aid of the — 193 — improvements, above specified.” In February, 1876, letters patent No. 172,896, and in August following letters patent No.. 181,113, were issued to Stebbins for improvements in hydraulic elevators. Suit was brought by the assignee of the two former patents for" infringement and to compel specific performance of the contract of assignment. It happened that only one expert witness testified on each side. That of the defendant expressed the opinion that the invention set forth in the two patents were entirely different in construction and mode of operation in every respect, except the fact of their having two cylinders and their pistons to assist each other in lifting the load. The plaintiff’s expert witness testified that the two1 inventions were substantially alike. The following excerpt from the opinion in the case will show it was held that the later patents, notwithstanding apparent similarity in design, mechanism, and use to the first two patents, did not infringe the former ones: “An examination of the specifications in connection with the specifications in patent No. 132,1111 shows that the views of the defendant’s expert must prevail oyer those of tire plaintiff’s expert, and that the doctrine of mechanical equivalents, cannot be successfully invoked in this case in favor of the plaintiff. And, further the considerations before stated as reasons why an apparatus constructed according to patent No. 172,896 does not infringe patent No. 132,111 go to show in connection with the considerations set forth in the testimony of Mr. Elliott, just cited, as to patent No.. 181,113, that an apparatus constructed according to patent No. 181,113 does not infringe patent No, 132,111; and further conceding, for the purpose of this case, that the assignment of November 4, 1872, — 194 — assigns the right of improvement subsequently invented or patented by the defendant, in or of, or in aid of, the inventions or improvements. patented by patent No-. 132,111 and patent No. 132,112, it is manifest that the reasons before set forth as showing that the inventions embraced in patent No. 172,896, and in patent No. 181,113, do not infringe patent No. 132,111, are equally cogent to show! that such inventions are not improvements in or of, or in aid of, any of the inventions of improvements patented by patent No. 132,111.” Frick v. Geiser Mfg. Co., 100 Fed., 94; 40 C. C. A., 291. We do! not think the authorities relied on by counsel are in conflict with the authorities, supra, or the views, herein expressed. In two of these (Littlefield v. Perry, 21 Wall., 226; 22 L. Ed., 557, and McFarland v. Mfg. Co., 53 N. J. Law, 649; 33 Atl., 962; 51 Am. St. Rep., 647) the application for the last patent was in express terms for an improvement of the former, and in the first the parties to the assignment also agreed that the last invention should be treated as; but an improvement of the first. Upon the whole case our conclusion is that the chancellor erred in adjudging to appellee a half or any interest in patent No. 732,232. We think, however, he should be repaid the $55 he expended on the model of patent No. 732,232 before bis abandonment of the agreement he made with appellant to furnish the money for its construction and tp procure the patent therefor, and this, sum, as. appears from the record, appellant tendered him, before suit, but he refused to accept it. For the reasons indicated, the judgment is reversed and cause remanded that it may be set aside, and in — 195 — lieu thereof such a judgment entered as will conform to the opinion herein. Petition for rehearing by appellee overruled.