Opinion ID: 428358
Heading Depth: 2
Heading Rank: 1

Heading: Violation of the Injunction

Text: 26 The district court's injunction prohibited Dura from directly or indirectly making, using or selling or causing to be made any device employing the patented features of the Turner suspension. The order further enjoined Dura 27 (d) From actively inducing and/or contributing to the infringement of said patent by supplying to others the Model 1400 Series suspension or any material part thereof especial [sic ] made or especially adopted [sic ] for use in the Model 1400 Series suspension which part is not a staple article or commodity of commerce suitable for substantial non-infringing use. 28 This provision was taken from 35 U.S.C. Sec. 271(c) which defines contributory infringement. For purposes of this appeal, we treat the scope of the injunction as coextensive with that of 35 U.S.C. Sec. 271(c). 6 29 Dura sold feather springs, brackets and other repair parts for its 1400 suspension after the injunction was entered on June 1, 1981. These sales continued until the court found Dura in criminal contempt for violating the injunction on March 5, 1982. 7 Dura does not deny that its sale of spare parts was contrary to the terms of the injunction, but it argues that the sale of these parts was nevertheless protected under Aro Manufacturing Co. v. Convertible Top Co., 365 U.S. 336, 81 S.Ct. 599, 5 L.Ed.2d 592 (1961) [hereinafter cited as Aro I ] and Aro Manufacturing Co. v. Convertible Top Co., 377 U.S. 476, 84 S.Ct. 1526, 12 L.Ed.2d 457 (1964) [hereinafter cited as Aro II ]. 30 In Aro I, a licensee of a combination patent for a convertible automobile top sought to enjoin Aro from producing and selling an unpatented component--the fabric--for repair of installed tops. The Court held that Aro could not be guilty of contributory infringement under 35 U.S.C. Sec. 271(c) unless there was a direct infringement of the patent. Replacement of worn tops, the Court ruled, was a permissible repair of property, not a reconstruction of the combination that would directly infringe the patent. Thus, the manufacture and sale of the replacement fabric did not contribute to a direct infringement of the combination patent. 365 U.S. at 341-45, 81 S.Ct. at 602-04. 31 The Court's holding in Aro I was narrowed by Aro II in a respect crucial to Dura's appeal. In Aro II the Court held Aro liable for selling fabric to any customer who owned a convertible manufactured by a company that was unlicensed to produce the convertible tops. Because the manufacture of these tops was unauthorized, the customers' use and even the repair of the structures directly infringed the patent. In Aro II, as was not the case in Aro I, the direct infringement by the car owners that is a prerequisite to contributory infringement by Aro was unquestionably established. 377 U.S. at 486, 84 S.Ct. at 1532. 32 Because Dura never acquired a license to the Turner patent, Aro II would seem to dictate that Dura's sale of non-staple repair parts to owners of the 1400 series suspension was contributory infringement. Dura attempts to escape this conclusion by arguing that owners of its infringing suspensions received an implied license from TWM to use those devices. Dura relies on Wagner Sign Service, Inc. v. Midwest News Reel Theatres, Inc., 119 F.2d 929 (7th Cir.1941) to argue that because the accounting order and supersedeas bond assured TWM of compensation for infringing units sold before June 1, 1981, owners of those units had received a constructive license to use and repair the suspensions. 33 We reject Dura's reasoning that its customers were licensed to use and repair the infringing suspensions. TWM has entered into no agreement with Dura releasing it or its customers from claims for infringement. Except for the supersedeas bond, TWM is in the same position as the patentee in Union Tool Co. v. Wilson, 259 U.S. 107, 42 S.Ct. 427, 66 L.Ed. 848 (1922). Wilson, a patentee who had been awarded an injunction and an accounting of damages, brought a contempt action against the original defendant for violating the injunction by selling spare parts. The Court upheld the contempt finding, ruling that Wilson had received no compensation which would license the use of the devices produced by the infringer. 34 Even if we were prepared to following the general ruling in Wagner Sign, this case is clearly distinguishable. There, the court held that a supersedeas bond which assures the payment of all profits and damages was equivalent to actual compensation. Yet the court noted that no question is raised on the record but that the bond is ample to protect the plaintiff in any judgment. 119 F.2d at 930 n. 1. Dura's claim that the supersedeas bond assures TWM of compensation borders on the disingenuous. TWM asserts, and it is not disputed by Dura, that the $5,000 bond is far from sufficient to cover the expected award from the accounting. Dura, it should also be noted, never attempted to clarify to this court or to the district court its intention to treat the order and supersedeas bond as constituting a license. In its successful application to this court to stay the accounting, Dura suggested a $5,000 bond to cover the nominal damages resulting from the delay in the accounting. The amount of the bond should cover only these damages, Dura argued to this court, not the potential damages resulting from years of infringement. A bond established on such grounds provided TWM no assurance that it would recover damages as determined by the accounting. Because Dura failed to establish that the owners of the 1400 suspensions were licensed by TWM, Dura's sale of the spare parts was contributory infringement in violation of the terms of the June 1, 1981 injunction.