Manningt v. Galland-Henning Pneumatic Malting Drum Manufacturing

Dodge, J. The complaint concededly declares a cause of action to recover the amounts agreed to be paid upon the con [202] tract of 1898 both for' royalties upon sales made by the defendant during the term of that contract and for moneys collected from other infringers of plaintiff’s territory. It is not contended that these two grounds of recovery, if they constitute separate causes of action, are not properly joinable, since they are indebtedness promised to be paid by the same contract. Reindl v. Heath, 109 Wis. 570, 85 N. W. 495. There is joined in the complaint also a claim to recover the damages to the plaintiff resulting from defendant’s alleged conduct, in selling machinery covered by the patent in the exclusive territory assigned to plaintiff during periods outside of the term of the contract of 1898. While this as a plain action at law would seem to be a separate and distinct cause of action, although not stated as such in the complaint, it is claimed by respondent not to be such, but merely a claim for additional relief upon tire single primary cause of action for an accounting by the defendant as to its conduct and the results thereof. Passing this controversy, however, and assuming for the purpose of the argument that it is distinct and separate, the proposition to be considered is whether it is one which can be joined with that or those first stated. Appellant claims not, because it is an action for infringement of a patent, ex delido in character and cognizable exclusively by tire federal courts. Our statute (sec. 2647, Stats. 1898) permits the joining of two or more causes of action upon contract, whether they be in law or equity, or both. Kruczinski v. Neuendorf, 99 Wis. 264, 74 N. W. 974; Emerson v. Nash, 124 Wis. 369, 382, 102 N. W. 921 ; Krakow v. Wille, 125 Wis. 284, 103 N. W. 1121. If therefore it shall be found, as respondent claims, that the questionable cause of action, namely, for damages, is on conti'act, there is no misjoinder. We proceed to consider that question. When the assignee of a patent, or one holding an exclusive license thereunder, suffers from its infringement by any one, he doubtless can avail himself of this federal statute and [203] bring bis suit either in law or in equity for bis damages from the infringement, which under the federal law and practice may include not only the damage to- himself which he can prove, but even the profit to the infringer; and in such action, the court may inquire into the validity and construction of the assignment or license for the purpose of ascertaining-plaintiff’s title and right to maintain suit (Excelsior W. P. Co. v. Pacific B. Co. 185 U. S. 282, 22 Sup. Ct. 681) ; but in such suit nothing more is recoverable against the assignor than against any stranger under no contract relation. If, however, the same act which is an infringement of the patent is also a. breach of some contract, the plaintiff may ignore the statutory right to recover for infringement and bring his action for damages proximately resulting from the breach of the contract, and of such action the federal courts have no exclusive jurisdiction. Excelsior W. P. Co. v. Pacific B. Co., supra; Hartell v. Tilghman, 99 U. S. 547, 552; Albright v. Teas, 106 U. S. 613, 1 Sup. Ct. 550; Williams v. Star S. Go. 35 Fed. 369. Plaintiff’s license in this case granted him the exclusive-right of manufacture and sale in the specific territory. It. thereby doubtless vested him with sufficient title to the patent to sue for infringement thereof, albeit in the patentee’s name,, under federal statutes. Brush E. Co. v. California E. L. Co. 52 Fed. 945; Littlefield v. Perry, 21 Wall. 205, 223. But the grant from defendant to plaintiff’s assignor was also a contract. It granted an exclusive right to- make, use, and vend. In all contracts granting property rights, or rights of' conduct, there is an implied agreement on the part of the assignor that he will do no affirmative act to derogate from his grant. That is implied in the very grant itself. In the nature of things it is inconceivable that the minds of the parties-have met on basis of a grant of something and, at the same time, on negation of that grant, in whole or in part This principle is very old in the law and has been applied to- a great variety of circumstances; in many cases being carried to- the204 point of declaring to be implied covenants going much, further. The grantor or lessor of land, in absence Qf statute, covenants for the quiet enjoyment of the property demised, and, even where statutes have negatived such implication, he is still held to have covenanted not to derogate from such grant by his own acts. A contract for exclusive agency implies that the principal will commit no act invasive of the exclusiveness of such agency. The grantor of an exclusive license under a patent is in the same position and subject to the same rule, as has often been decided. Eldred v. Leahy, 31 Wis. 546; Shaft v. Carey, 107 Wis. 273, 83 N. W. 288; John O’Brien L. Co. v. Wilkinson, 117 Wis. 468, 94 N. W. 337; W. G. Taylor Co. v. Bannerman, 120 Wis. 189, 97 N. W. 918; Olson v. Viroqua, 121 Wis. 571, 574, 99 N. W. 326; Halsey v. Waukesha Springs S. Co. 125 Wis. 311, 104 N. W. 94; Kipp v. Smith, 137 Wis. 234, 240, 118 N. W. 848; Birdsall v. Perego, 5 Blatchf. 251, Fed. Cas. No. 1,435; Faulks v. Kamp, 3 Fed. 899, 901; Brush E. Co. v. California E. L. Co. 52 Fed. 945; Philadelphia, W. & B. R. Co. v. Howard, 13 How. 307, 342; Rawle, Cov. for Title, §§ 270, 287; French v. Bent, 43 N. H. 448; St. Louis & D. L. & M. Co. v. Tierney, 5 Colo. 582; Morier v. Moran, 58 Ill. App. 235; Gay & Co. v. Blanchard, 32 La. Ann. 497, 504; Black v. Woodrow, 39 Md. 194; Eliot Nat. Bank v. Beal, 141 Mass. 566, 569, 6 N. E. 742; Smith v. Boston, C. & M. R. 36 N. H. 458, 494. We think that principle clearly controls the present situation. When defendant granted to plaintiff’s assignor exclusive rights, it just as surely and completely by that grant agreed that it would not so act as to prevent him from enjoying such exclusive right. When, as alleged in the complaint, it invaded his territory and the exclusiveness of his sale in the same it broke that contract. An action to recover damages therefor is strictjy an action on contract. It is maintainable whether any valid patent is infringed or not. There is in ■our opinion no escape, therefore, from the conclusion that if [205] the causes of action are separate they axe nevertheless such as by virtue of our statute might be joined in the same complaint, and that the demurrer to that pleading on the sole ground of misjoinder was properly overruled. By the Court. — Order affirmed.