Serrell v. Collins. George Gifford, for the plaintiff. Charles M. Keller, for the defendants. INGERSOLL, J. The right of the plaintiff to the invention patented has never been established at law. An action is pending before this Court, on the law side thereof, in favor of the plaintiff, against the defendants, in which the validity of the patent is to be contested and tried. It was expected that that action at law would have been tried at the present term of the Court, but it has gone over to the next term, when it will be tried. At the early part of the term, the defendants were ready to try it; but, during the term, in consequence of a fire which took place, by which some of the evidence relied on by the defendants, to establish their defence, was lost and destroyed, it became necessary to have the trial postponed. The rights of the plaintiff under the patent have not been acquiesced in by the public. Others besides the defendants. contest those rights and insist that the plaintiff has no rights under the patent. Under these circumstances, the plaintiff must make out a case clear of all doubt, to authorize the Court to grant the injunction prayed for. Such a case has not been made out. It seems that, under the first patent, and also under the first reissued one, the plaintiff failed to establish his right, when the question was tried at law. Without intimating what my opinion would be, on the proofs as exhibited, if the case were now on the final hearing, I must deny the present motion. But, while I deny it, I will make an order requiring the defendants to be ready to try the action at law pending against them in this Court, at the next term thereof, whenever the same shall be called, and providing that, if they are not so ready, an injunction shall then issue against them, as prayed for. Goodyear v. The Union India Rubber Co. CHARLES GOODYEAR AND WILLIAM JUDSON vs. THE UNION INDIA RUBBER COMPANY. IN EQUITY. Where a license was granted under a patent, with covenants that the licensee should pay certain tariffs, and keep correct accounts, and permit his books to be examined, but there was no express provision that, if the covenants were broken, the rights granted should revert to the licensor, and a bill was filed by the licensor against the licensee, praying for a decree that the covenants should be performed, and for an injunction to prevent the use of the patent under the license, until the covenants should be performed, and the citizenship of the parties did not give to the Court jurisdiction of the suit: Held, that the subject-matter did not give the Court jurisdiction; that the suit was not one to prevent the violation of any right of the licensor, secured by any law of the United States, within section 17 of the Patent Act of July 4th, 1836, (5 U. S. Stat. at Large, 124,) but was one to prevent the violation of the rights secured by the covenants; and that the Court had no jurisdiction of the case. (Before INGERSOLL, J., Southern District of New York, June 30th, 1857.) THIS was an application for a provisional injunction. Soon after the plaintiff Goodyear obtained his patent for vulcanized india-rubber, in the year 1844, he granted licenses to certain parties to manufacture certain kinds of india-rubber goods, the licensees covenanting to pay certain tariffs, to keep true accounts, to permit the licensor to inspect their books at all reasonable times, and to do certain other things. The rights originally granted by the licenses from Goodyear, became vested in the defendants, a corporation created by the laws of the State of New York, and located and doing business in the city of New York, who became bound to perform the covenants entered into by the original licensees. Goodyear, in December, 1856, transferred all his right to his patent, and all claim for tariffs against the defendants, and all other demands against them, to the plaintiff Judson. No tariffs had been paid by the defendants for more than three years prior to the Goodyear v. The Union India Rubber Co. filing of the bill, and, for that time, they had refused to permit their books to be inspected. They urged that they had good reasons for not paying, and for refusing to permit their books to be inspected. The bill described the plaintiffs, as "William Judson of the city of New York, and Charles Goodyear, a citizen of the United States, now residing in the city of London," and the defendants as "the Union India Rubber Company, a corporation created and established by the laws of the State of New York, and carrying on business within said State." The bill set out the patent; the assignment to Judson; the original licenses granted by Goodyear; the rights of the defendants under the licenses; the obligation of the defendants to pay the tariffs, and to perform all the covenants entered into by the original licensees; and their neglect and refusal. It prayed that the defendants might be decreed to render correct accounts of all the articles made under the licenses, and to pay over the tariffs stipulated to be paid, and to account for articles made in violation of the patent, and for the damages sustained by breaches of their covenants, and that, until they had so accounted and paid over such tariffs, they might be enjoined from manufacturing or selling any articles made by the use of the patent, the right to manufacture which had been granted by the licenses, and that they might be also enjoined from any further violation of the patent. There was, also, a prayer for general relief, and for a provisional injunction. James T. Brady, for the plaintiffs. Francis B. Cutting and William Curtis Noyes, for the defendants. INGERSOLL, J. Several important questions were presented on this motion, and elaborately argued by counsel. The view taken by the Court of one of the questions, renders it unnecessary that the other should be considered, as the result arrived at in considering that one question, disposes of the case. That question is the question of jurisdiction. Goodyear v. The Union India Rubber Company. It is clear that the citizenship of the parties does not give the Court jurisdiction. The parties plaintiffs are William Judson and Charles Goodyear. The defendants are the Union India Rubber Company. Judson is described as of the city of New York. Goodyear is described as a citizen of the United States, residing in London. The defendants are a corporation created by the laws of the State of New York, and located in the city of New York. The Court, therefore, has no jurisdiction, unless the subject-matter of the bill gives jurisdiction; and it is insisted by the defendants that the subject-matter of the bill does not give jurisdiction. By the Constitution of the United States, the judicial power extends not only to controversies between citizens of different States, but also to all cases in law and equity, arising under the laws of the United States; and the 17th section of the patent Act of July 4th, 1836, (5 U. S. Stat. at Large, 124,) under which it is claimed by the plaintiffs, that the Court has jurisdiction, provides "that all actions, suits, controversies and cases, arising under any law of the United States, granting or confirming to inventors the exclusive right to their inventions or discoveries, shall be originally cognizable, as well in equity as at law, by the Circuit Court of the United States, or any District Court having the powers and jurisdiction of a Circuit Court; which Courts shall have power, upon a bill in equity filed by any party aggrieved, in any such case, to grant injunctions, according to the course and principles of Courts of Equity, to prevent the violation of the rights of any inventor, as secured to him by any law of the United States." There can be no violation of any right secured to a patentee under a law of the United States giving to him the exclusive right to use the thing patented, provided such thing patented is used by a licensee under a license or grant made by the patentee, upon such licensee's entering into a covenant that he will do certain things, so long as the license or grant remains in full force. If such licensee uses the patented invention beyond the limits of the license or grant, or in a way VOL. IV.-5 Goodyear v. The Union India Rubber Company. not authorized by the license or grant, then there has been a violation of a right secured to the patentee under a law of the United States giving to him the exclusive right to use the thing patented, although such licensee performs, according to their terms, all the covenants entered into by him. If such licensee uses the patented invention within the limits of the license or grant, and performs the covenants which he has entered into, there is no violation of any of the patentee's rights of any kind. If, in the use of the thing granted, the licensee does not perform his covenants, although there is, by such non-performance, a violation of the rights of the patentee, such violation is not a violation of the rights of the patentee as secured by a law of the United States, but a violation of his rights as secured by the covenants. He has, by the license or grant, parted with a portion of that which was secured to him by the laws of the United States, and has, in lieu thereof, taken a right secured by a covenant. If a patentee parts with the whole right secured by his patent, either for cash, or upon the purchaser's entering into a covenant to pay him a certain sum of money, or to do certain other things, the patentee has, after such sale, no right vested in him secured by any Act of Congress. A suit to enforce the covenants would not be a case arising under a law of the United States. The use of the whole thing sold cannot be a violation of any rights of the patentee secured by the laws of the United States, so long as the deed of sale remains in full force, for he has parted with all such rights. And, when a portion of the right is parted with, the rule must be the same, as it respects such portion. The weight of authority in adjudged cases, sustains the view thus taken of this question. The case of Woodworth v. Weed. (1 Blatchford's C. C. R., 165,) decided in 1846, was an appucation for an injunction. The plaintiff had granted to the defendant a license to construct and use one of the Woodworth planing machines, for which the defendant agreed to give, and did give, five several promissory notes, in all amounting to four hundred dollars, the defendant agreeing that, if |