Harbaugh v. Dwyer

RUDKIN, Circuit Judge (after stating the facts as above). It was conceded before the master, and is now conceded, that the machines used by both parties to this suit were gambling devices (Dwyer v. Seattle, 116 Wash. 449, 199 Pac. 740), and it is further conceded that the owner or operator of a gambling device cannot recover damages by way of lost profits for interference with his unlawful enterprise. This rule is well settled. 17 C. J. 797; 13 Cyc. 59; 3 Sutherland on Damages, § 969; 1 Joyce on Damages, § 445; Raynor v. Valentin Blatz Brewing Co., 100 Wis. 414, 76 N. W. 343; Kauffman v. Babcock, 67 Tex. 241, 2 S. W. 878; Young v. Stevenson, 75 Ark. 181, 86 S. W. 1000. But the appellant contends that through the, wrongful injunction the appellee has realized profits that otherwise would have accrued to him, and that the appellee should be required to account for these profits, notwithstanding the illegality of the enterprise in which both parties were engaged, inasmuch as the illegal transactions out of which the profits arose are at an end. Brooks v. Martin, 2 Wall. 70, 17 L. Ed. 732, and kindred cases are cited in support of this view. If the premise is correct, the conclusion might follow; but what interest has the appellant in the profits made or realized by the appellee? Each party was using a different gambling device, at least different in the sense that one did not infringe upon the other, and the appellant had no interest, contractual or otherwise, in either the business of the appellee or in the device employed by him. The measure of damages arising from a wrongful injunction is the loss to the party enjoined, not the benefit accruing to his adversary, and where a party has been improperly enjoined from prosecuting a business it is ordinarily immaterial whether the plaintiff was engaged in the same line of business or not, and if engaged in the same line of business, whether his business was conducted at a profit or at a loss. If. the gambling devices here in question were in general use by others, it would scarcely be contended that the appellee could be required to account to the appellant for any part of the profits, realized by him, and the mere fact that the devices were used by these two parties only does not change the measure of damages or the rules of law. It is to be regretted that the appellee has profited by an abuse of the processes of the court, but the appellant is in a measure responsible for [249] this. Had he interposed the defense of illegality at the threshold of the case, doubtless the injunctive relief would have been withheld, for, in the absence of any such defense, the court on final hearing said: “There is another reason why I am inclined to think the court should decline to- grant plaintiff relief. If plaintiff’s device is not a lottery or gambling device, it' borders closely thereon. It is the element of chance in its operation which gives it value, and hence I doubt whether a court of equity, on grounds of public policy, should assume to protect him in a monopoly thereof.” Of the injunction, therefore, the appellant has little ground for complaint. But in any event he is not entitled to recover profits he might have realized in operating a gambling device in violation of law, nor is he entitled to share in the profits of another, in which he has no interest, and to which he has no lawful claim by contract or otherwise. The decree of the court below is affirmed.