Court Opinion

ID: 9641024
Source: CourtListenerOpinion
Date Created: 2023-08-22 17:21:10.55657+00
Date Added: 2024-06-11T18:10:34.547816
License: Public Domain

DONAHUE, Circuit Judge
(dissenting).
Under the provisions of equity rule 37, any one claiming an interest in a litigation may at any time be permitted to assert his right by intervention; the only, condition being that sueh intervention shall be in recognition of the propriety of the main proceedings and in subordination thereto.
In this case it is alleged in the intervening petition of the Cutler Company that it entered into a contract with its customer, the Dort Company, to defend that company against any action brought for infringement against it, and to save the Dort Company harmless from the payment of any damages that may be assessed against it in sueh suit. It is therefore vitally interested in the subject-matter of this litigation. It is not attacking the propriety of the main proceeding nor insisting that its intervention shall not be in subordination thereto.
It is also a general rule of equity that intervention will be allowed where it appears to the court that a deeree in the main cause cannot be entered without prejudice to the rights of the intervener. If a decree were to be entered in this ease against the Dort Company, the Cutler Company, under the terms of its contract with the Dort Company, would be liable for the payment of any damages assessed against the Dort Company. In sueh an event the rights of the intervener would be prejudiced, and the benefits of the deeree entered in its favor in the suit brought by this plaintiff against it in the second circuit would be wholly lost.
In that suit there was a -final judgment for the Cutler Company. It was held in Kessler v. Eldred, 206 U. S. 285-288, 27 S. Ct. 611, 612, 51 L. Ed. 1065: This judgment, whether it proceeds upon good reasons, or upon bad reasons, whether, it was right or wrong, settled finally and everywhere, and so far as Eldred, by virtue of his ownership of the Chambers patent, was concerned, that Kessler had the right to manufacture, use and sell,” etc., and further that the “rights between litigants once established by the final judgment of a court of competent jurisdiction must be recognized in every way, and wherever the judgment is entitled to respect, by those who are bound thereby,” and that the deeree finally established “the right of Kessler to manufacture and sell his manufactures free from all interference from Eldred by virtue of the Chambers patent, and the corresponding duty of Eldred to recognize and yield to that right everywhere and always.”
The fact that this plaintiff brought this action against the Dort Company, before the final decision. of the action brought by it against the Cutler Company in the second circuit, cannot affect the question here presented. In that suit the plaintiff challenged the right of the Cutler Company to manufacture and sell to its customers in the various parts of the United States, the article that the plaintiff claimed infringed its patent. It invoked the jurisdiction of that court for the determination of that question, and the effect of that final deeree was to settle forever the respective rights of the parties.
After the entering of that deeree, it was equally the duty of plaintiff to dismiss any suits then pending against the customers of the Cutler Company, as it was its duty to refrain from bringing other suits. That it has failed to “recognize and yield to that right everywhere and always” by dismissing this suit fully justified the trial court in allowing the Cutler Company to intervene in this action against its customer and compel plaintiff’s obedience to that final deeree. Any other course would permit the plaintiff to trifle with courts and by subterfuge evade the effect of a final decree against it. If, as held in Kessler v. Eldred, supra, the plaintiff, after a final deeree against it, has no authority to bring or maintain an action against a customer of & manufacturer in whose favor the decree was entered, and that the bringing and maintaining of sueh actions may be enjoined at the suit of the manufacturer, the plaintiff is hardly in position to complain of any action taken by a court in disposing of a cause it has no legal nor equitable right to prosecute to final judgment. Kessler v. Eldred, supta, does not hold that the sole and only remedy of Kessler was by action in equity to enjoin the plaintiff from bringing further suits. On the contrary, it held that the plaintiff was entitled to an injunction to prevent a multiplicity of suits, and because there was no adequate remedy at law, but, whether the Cutler Company could maintain such an action where there is only the one suit pending against one of its customers and none others threatened does not so clearly appear. In the Kessler Case it further appears that Eldred had filed a suit for infringement of the same patent against Breitweiser, a customer, in which suit the Kessler Company, the manufacturer, had been permitted to intervene. There is no suggestion in the *382opinion that its intervention was not proper, bnt rather that> notwithstanding such intervention, the plaintiff was entitled to an injunction.
The effect of the decree in the second circuit to which reference is made in the majority opinion was to free from the control of the plaintiff’s patent the articles manufactured and sold by the Cutler Company. The plaintiff in defiance of that decree is now seeking to harrass the Cutler Company, and .to injure its business by continuing the prosecution of this suit against its customer. If the Cutler Company has the right to enjoin the further prosecution of this suit against the Dort Company in a separate action, because the bringing and the prosecution of sueh suits are “manifestly in violation of the obligations of the plaintiff and the corresponding right of the Cutler Company established by the prior judgment,” as held by the Supreme Court in the Kessler Case, and suggested in the majority opinion in this ease, then the objection to the Cutler Company obtaining the same relief as to the pending suit by intervention and assertion of its rights under the final judgment in the second circuit is purely technical, and would tend to encourage, rather than to prevent, a multiplicity of suits.
For the reasons stated I cannot eoncur in the judgment of the majority of the court that the District Court abused its discretion in permitting the Cutler Company to intervene in this action against its customer, which suit by its contract it is required to defend, and to save the Dort Company harmless from all damages that may be assessed against it.