CHICAGO & A. RY. CO. et al. v. PRESSED STEEL CAR CO., 243 F. 883

SANBORN, District Judge (after stating the facts as above). The questions presented are substantially as stated above, and may be thus restated: Is the equity decree, dismissing the bill for want of equity and because defendants therein (plaintiffs here) had an adequate remedy at law, an estoppel in this case, sufficient to support the judgment sought to be reviewed? Does the general finding of fact in the judgment prevent a review on this writ of error?

Was proof of the prior art admissible either (1) because the Lindstrom & Streib patent refers to the prior art; or (2) because the words “arranged to support the door directly” in claim 13 are ambiguous; or (3) because there has been no user or enjoyment under the patent in suit, as claimed in the brief or amicus curias ? Did defendants use the mechanism of the patent in suit, and should the judgment therefore be affirmed? 1. Is the equity decree an estoppel?

The bill in equity was filed to restrain this suit at law because the contract was alleged fraudulent, that there was no contract, that it is unconscionable, and to avoid multiplicity of suits. The court held there was no fraud or imposition, and that the contract would not be set aside as improvident, or because there was apprehension of embarrassment or loss thereunder, and that as to the question of validity there was a full, adequate, and complete remedy at law by an action for royalty, such as this one is. The suit was accordingly dismissed for want of equity.

It is evident that the matters in dispute here were neither litigated in the equity suit, nor could have been. It is a general rule that a decree of dismissal in a suit to restrain an action at law is not an adjudication in the latter, because the very foundation of the equity decree is that the remedy at law is adequate and ample. Grand Pacific Hotel Co. v. Pinkerton, 118 Ill. App. 89; Id., 217 Ill. 61, 75 N. E. 427; Lundy v. Mason, 174 Ill. 505, 51 N. E. 614. Equity had no jurisdiction, and the bill was therefore dismissed.

This was an affirmance of the right to bring this suit, rather than a judgment disposing of it. Richards v. L. S. & M. S. R. Co., 124 Ill. 516, 16 N. E. 909. So the only question is whether defendant at law, by bringing suit in equity to restrain the former on the ground that he has an equitable defense not available at law, admits that he has no legal defense, and therefore tacitly confesses judgment in the suit at law.

Such authority as has been found seems to show that.a decree of dismissal in the equity suit, to the effect that complainant has an adequate remedy at law, is not a bar to any defense at law, which was not decided in equity, and could not have been there decided because the remedy at law was deemed adequate. Grand Pacific Hotel Co. v. Pinkerton, 118 Ill. App. 89; Id., 217 Ill. 61, 75 N. E. 427; Lundy v. Mason, 174 Ill. 505, 51 N. E. 614; Richards v. L. S. & M. S. R. Co., 124 Ill. 516, 16 N. E. 909.

An examination of many cases of bills dismissed for adequate remedy at law discloses no trace of any practice requiring defendant in a bill to restrain a suit at law either to admit that he had no defense at law or to confess judgment at law, except a former practice in cases involving land titles.

If a bill to restrain an ejectment suit on tire ground of an equitable defense not available at law is filed, it has been held that complainant (defendant at law) must confess judgment in the ejectment suit, because otherwise, even if he failed, and the equity court sustained the legal title in defendant, the latter could not get possession without prosecuting his ejectment. Daniell’s Chancery, 1624; Turner v. American Baptist Missionary Union, 5 McL. 344, 24 Fed. Cas. No. 14,251; Mathews v. Douglass, 1 Cooke (Tenn.) 136, Fed. Cas. No. 9,276; Trousdale v. Maxwell, 6 Lea (Tenn.) 161; Henry v. Tupper, 27 Vt. 518.

One of the many cases where a bill was dismissed for adequate remedy at law, and the suit sought to be restrained was tried on its merits, is Grand Chute v. Winegar, 15 Wall. 355, 21 L. Ed. 170 (at law), and 15 Wall. 373, 21 L. Ed. 174 (in equity), an action on municipal bonds. Patterson v. Turner, 62 Ga. 674, and Ham v. Schuyler, 2 John. Ch. (N. Y.) 140, are directly in favor of defendants. The question is no longer of much importance since the act of 1915, allowing-equitable defenses in actions at law.

Section 274b, Judicial Code, U. S. Comp. Stats. § 1251b, 38 Stat. 956. The rule of practice referred to has not been applied to cases other than those involving land title or possession. Plaintiffs in error, therefore, did not admit liability -in this suit by bringing the equity action, and the decree therein is not an estoppel in this proceeding. 2. Does the general finding prevent a review of the judgment? The case having been tried by the court pursuant to a written waiver of jury trial, and the finding being a general one, no disputed question of fact is now subject to. review. St. Louis v. Western Union Tel.

Co., 166 U. S. 388, 17 Sup. Ct. 608, 41 L. Ed. 1044. If, therefore the question whether defendants used the Lindstrom & Streib invention ou the 2,000 cars was one of fact the judgment must be affirmed. Infringement is sometimes a question of fact, of law, or mixed law and fact, depending entirely upon the condition of the proofs. In most cases the question is one of fact, and if the case is tried by jury it is error for the court to- direct a peremptory verdict. Coupe v. Royer, 155 U. S. 565, 578, 15 Sup. Ct. 199, 39 L. Ed. 263, 268.

But where no evidence of prior art, or extrinsic evidence to explain the respective structures, is necessary the question is one of law, and the trial judge is authorized to direct a verdict. Singer Mfg. Co. v. Cramer, 192 U. S. 265, 24 Sup. Ct. 291, 48 L. Ed. 437. We think this case is controlled by the latter decision. All evidence of the prior art was struck out, and the structures of the Lindstrom & Streib and Christianson patents are so plainly described and illustrated in the descriptions and drawings ¡.hat no other proof is necessary to afford clear apprehension of their construction and mode of operation.

The question of similarity of the two structures is therefore one of law, not.foreclosed by the general finding. 3. Was the prior art admissible, and did defendants use the licensed structure? In this circuit it is settled law that in a suit upon a patent license contract the prior.art is not admissible, either to limit the prima facie scope of the claims or to show their invalidity. This statement of the law is based upon the principle of estoppel by contract; estoppel by deed or writing, not by conduct. Siemens-Halske Elec. Co. v. Duncan Elec. Co., 142 Fed. 157, 73 C. C. A. 375.

The rule in this circuit was first stated in 1886 by judge Blodgett, in Pope Mfg. Co. v. Owsley (C. C.) 27 Fed. 100, and llie latest case in this court is Indiana Mfg. Co. v. J. I. Case Threshing Machine Co., 154 Fed. 365, 83 C. C. A. 343, although others recognize the rale, such as Macey Co. v. Globe-Wernicke Co., 180 Fed. 401, 103 C. C. A. 547.

There is an exception to the rule where the claim relied on is ambiguous on its face, explained by Judge Baker in the Siemens-Halske Case: “In our judgment tlie reason of the case leads to tile conclusion that, between contracting parties extraneous evidence is inadmissible if there is no ambiguity or uncertainty in the language of the description and claims, and that, if' there is uncertainty, outside evidence is admissible only to make clear what the applicant meant to claim and the government to allow, and not for the purpose of showing even in the slightest degree that the applicant had no right to claim and that the government was improvident in allowing what was in fact claimed and allowed.” Both parties insist that there is no ambiguity, but each construes the claims differently.

Claim 13, chiefly relied on, reads: "Car door mechanism having a lifting shaft arranged to support the door directly when the door is raised, and a flexible connection between the shaft and door.” It is insisted by defendants that the use of the word “directly” clearly means that the door support must be immediately beneath it, while in the Christianson patent the shaft directly supports a latch attached to the door, thus indirectly supporting the door.

Defendants further claim that plaintiff has introduced uncertainty by asserting that claim 13 means just the same as if the word were omitted, or “indirectly” substituted. So it 'is claimed that the prior art is admissible to clear up an ambiguity having no real existence, dwelling only in the imagination of defendants’ counsel. For better understanding the designs of the two patents, Lindstrom & Streib and Christianson, are here introduced. IvIndstrom & Streib.

It will be seen that in one the shaft 5 slides or creeps back and forth as the door lowers and raises, and when the door is closed is beneath the shoe IB, which is rigidly attached to the under edge of the door. In the other the shaft is immovable, and supports the sliding or creeping latch £. In one the shaft moves back and forth and in the other the latch, so if it were not for the word “directly” in claim 13 there would be no difficulty whatever in concluding that the two devices are absolute mechanical equivalents.

The prior art which was offered, and later struck from the record, is claimed to show the following: “1. Door supported by tbe winding or lifting chains, as represented in Lip schutz, No. 750,670. ‘■2. Doors supported by the lifting shaft through intermediate means connecting the shaft and the doors, as represented in Si monton, 616,811, Simon-ton, 6(i6,160, and Bellows, 693,218. “3. Doors supported by bolts or latches operated :by means other than the winding shaft, as represented in Simons, 531,584, Campbell et al., 598,136, Hager, 674,357, Hanson, 720,245, and Swanson, 727,487, “4.

Doors supported by bolts or latches operated by the winding shaft or chain as represented in Bellows, 644,890, and in the defendant’s construction built under Christianson, 828,458. “5. Doors supported directly by the shaft, as represented in Becker, 703,841, in Caswell, 806,394, and in the Lindstrom & Streib patent in suit.” These prior patents, it is said, show why the word “directly” was used in claim 13, to distinguish between the fourth and fifth types, and limit the claim to those constructions in which the shaft supports the door without the use of any medium, such as the latch.

Therefore, it is insisted, the claim is clear, and excludes defendants’ construction; but, if by any possibility the word introduces uncertainty, the prior art clears it up, and shows that defendants did not use the Lindstrom & Streib conception. The technical force of this argument is evident, but we think, since the validity of the claim is necessarily conceded, absolutely unlimited in its prima facie scope by the prior art, the two constructions must he regarded as equivalent in all respects.

One slides the support and the other the thing supported, obviously a mere mechanical interchange; as defendants’ counsel said (in another connection), the two are twin brothers. The purpose of Lindstrom & Streib was to securely support a car bottom door by means of the shaft used to open and. close the door. This means and operation are admittedly novel and useful, without any anticipation whatever. The estoppel supplies all these elements. In this situation it is plain that defendants use like means and operation and get the same result.

An interesting brief, very carefully prepared, was by leave of court filed by George Adams Ellis as amicus curias. Stated very briefly, his argument is that because defendants have never entered into possession or made use of the Lindstrom & Streib patent, or of the designs and devices covered thereby, there is no estoppel. The argument depends on the assumption that licenses of real estate and patent rights, and the principles of estoppel in real estate and patent cases, are entirely similar, the estoppel in each depending on actual use of the thing licensed.

Since we think that real estate and patent transfers stand on different grounds, a synopsis of the argument would hardly be justified here. As already stated, estoppel by patent license is by deed, and does not depend on user of the device licensed. It is most clearly shown, in plaintiff’s brief in reply to Mr. Ellis, that a patent conveys nothing but a negative right of exclusion. It is the right to exclude others, but not the natural right to make, use, and sell, which the patentee obtains from his general ownership of the materials employed, not from the government.

So the licensee does not obtain this right to malee, use, and sell from th#license, but only immunity from suit by the licensor. Paper Bag Case, 210 U. S. 405, 28 Sup. Ct. 748, 52 L. Ed. 1122; Hartman v. John D. Park & Sons (C. C.) 145 Fed. 358, 364. A license passes nothing, but only makes something lawful which would have been unlawful without it. Even a patent assignment creates merely an immunity, and the right to exclude others. Hence a licensee under a patent does not enter into or use any property transferred, so that real estate and patent licenses are in this respect properly distinguished.

The fact, therefore, that defendants never intentionally used the Eindstrom & Streib devices, and made no use of that licensed invention other than by the purchase and use of the cars in suit, is, we think, of no materiality in the case. The judgment is affirmed.