Court Opinion

ID: 8831180
Source: CourtListenerOpinion
Date Created: 2022-11-26 16:04:03.894083+00
Date Added: 2024-06-11T17:04:55.894685
License: Public Domain

DENISON, Circuit Judge
(after stating the facts as above).  The question whether a case arises under the patent laws, or arises merely under contract and only presents the patent questions in an incidental or anticipatory way, has given rise to a long line of decisions, not always distinguishable without conflict. The leading cases are hereinafter cited. The general rules to be deduced from them are *878that, if the case is brought either to enforce or to set aside a contract, federal jurisdiction is not found in the mere fact that the contract relates to patents, while, if the suit is one for infringement of a patent, federal jurisdiction is not necessarily lacking either because the answer sets up, or because the complaint anticipates and avoids, a defense based on contract.
The first paragraph of this complaint is dependent wholly on the theory that the assignment of 1909 was procured by fraud and coercion and .without consideration, and was therefore not void, but voidable, at the option of the Lowry estate, and that the estate now exercises that option and wishes the contract declared fraudulent and set aside, as the first step upon the granting of which any further relief must be based. We think the cases later cited make it plain that there is no right to maintain such a case in a federal court, unless there is diverse citizenship, and that the strength of defendant’s contention that the case was removable is to be found in the second paragraph, which alleges that the assignment was void, because the Kentucky court was without jurisdiction to appoint an administrator. The third states a case more nearly of the merely voidable. We therefore give the removing defendant the benefit of all doubts when we confine ourselves to.this second paragraph. However, since amendment would doubtless be permitted distributing among the different paragraphs the relief asked in any, we consider as if included in the second paragraph all the relief asked in the complaint.
The argument in favor of jurisdiction finds its strongest support in the line of cases of which Healy v. Seagull Co., 237 U. S. 479, 35 Sup. Ct. 658, 59 L. Ed. 1056, is the latest in the Supreme Court, and The Fair v. Kohler Co., 228 U. S. 22, 33, Sup. Ct. 410, 57 L. Ed. 716; Excelsior Co. v. Pacific Co., 185 U. S. 282, 22 Sup. Ct. 681, 46 L. Ed. 910, and Henry v. Dick Co., 224 U. S. 1, 32 Sup. Ct. 364, 56 L. Ed. 645, Ann. Cas. 1913D, 880 (overruled but not on this point), are .earlier examples in the same court. These cases undoubtedly modify the decision in Hartell v. Tilghman, 99 U. S. 547, 25 L. Ed. 357, as its scope might be taken from some things there said and as it was interpreted in this circuit in Densmore v. Three Rivers Co. (C. C.) 38 Fed. 747. They establish that where the suit is clearly and plainly one brought for infringement of patent, and involving the issues usual in such cases, the fact is not fatal, whether it appears by the bill or by the answer, that the defendant has had a license under the patent, and that the matter of actual dispute between the parties is whether that license, according to its terms, is still in force. In these cases it has been considered that the main and primary question is one of infringement, and that the question whether there is a license continuing in force must be taken as a secondary and collateral dispute, however controlling it may turn out to be. If the defense of license is sustained, the plaintiff’s jurisdictional case remains unimpeached, but a good defense has been shown. A license is an exception cut out of the broader right, the considerations which make such a defense incidental or collateral do not apply with the same force, if at all, where the title itself is involved.
*879However this might he, we think it might be conceded for the purpose of this opinion that an infringement suit in ordinary form, seeking a decree that the patent was valid and that it had been infringed, and praying injunction and accounting for profits and damages arising from infringement, would present a case arising under the patent law, even though it alleged that defendant was claiming title to the patent under a void conveyance and asked to have that conveyance set aside or disregarded as of no force (see Atherton Co. v. Atwood Co. [C. C. A. 3] 102 Fed. 949, 43 C. C. A. 72) ; but that concession would not help the removing defendant here. We cannot find in the allegations of the second paragraph, aided by the prayers of all the paragraphs, either the substance or the color of an infringement suit. The whole declared purpose is not to hold Hert as an infringer, but to hold him as a trustee for the plaintiff for all the amounts and" benefits he has received through selling or granting rights under that title to the patent which really belonged to the plaintiff. None of the decisions relied upon by defendant present a case with such an aspect, and we think this case is clearly covered by that general doctrine of Wilson v. Sandford, 10 How. 99, 13 L. Ed. 344, and Hartell v. Tilghman, supra, which remains unmodified by later cases. The party who brings the suit is “master to decide what law he will rely upon,” and Odell v. Farnsworth, 250 U. S. 501, 39 Sup. Ct. 516, 63 L. Ed. 1111, illustrates how much latitude he has in fixing the jurisdiction by shaping his complaint. The court which considers such a case must decide, as in the strikingly analogous case of Brown v. Shannon, 20 How. 56, 15 L. Ed. 826, what is the gravamen of the complaint — whether infringement or contract rights.
It is impossible to see how any question of patent validity or of infringement can arise against Hert, the sole defendant. If plaintiffs have the true title, defendant would not be permitted, on any pretext, to deny his trusteeship and responsibility. The only actual disputes indicated by the bill are (second paragraph) as to the jurisdiction of the Lexington court of probate, and (third paragraph) as to what are lawful sales and signatures under state laws. These considerations are not necessarily controlling, but they do not point toward a case of federal jurisdiction.
We conclude that the court below never acquired jurisdiction of the case, and that it must be remanded to that court, with instructions to remand to the state court. Appellant will recover costs of this court.