LEONARD et al. v. CROCKER WHEELER CO. (Circuit Court, D. New Jersey. November 28, 1903.) L PATENTS-CONSTRUCTION OF LICENSE. A license executed by the owner of a number of patents granted to defendant the right to "make, use, sell, and practice for the regulation or control of dynamo electric machinery for the purpose, except respecting patent No. 478,344, of regulating or controlling electric motors of its own manufacture, any of the inventions aforesaid." Held, that such license did not include the device of patent No. 478,344, especially in view of the fact that such construction was placed on the contract by both parties for a number of years. In Equity. Suit for infringement of patent. On special plea setting up license contract. C. V. Edwards and Clarence E. Mehlhope, for complainants. ant. KIRKPATRICK, District Judge. This bill is filed by the Bullock Electric Manufacturing Company and Henry Ward Leonard for infringement of letters patent of the United States No. 478,344, issued July 5, 1892, to H. Ward Leonard, of which the Bullock Company claims to be the exclusive licensee. The defendant has filed a special plea setting up a prior license to manufacture and use the device described in said patent, and has introduced in evidence an agreement, made between Leonard, the patentee, and itself, dated May 5, 1896. The agreement under which it claims such license is set out at length, and in these words: "The said H. Ward Leonard grants to the said Crocker Wheeler Company a non-exclusive, non-assignable license without limitation condition or royalty to be paid by it or the purchasers of the apparatus, except as hereinafter specified, to make, use, sell and practice for the regulation or control of dynamo electric machinery for the purpose, except respecting patent No. 478,344, of regulating or controlling electric motors of its own manufacture and for no other purpose except as hereinafter provided in section marked 1 page 4 throughout the United States and the territories thereof any of the inventions aforesaid whether assigned by the Crocker Wheeler Company to the said Leonard or already owned by him, the said license being given under the aforesaid application and patents and any patents reissued which may be hereafter granted upon said inventions or any of them for the full term or terms of said patents, reissues or extensions." The rights of the parties depend upon the interpretation given to this agreement, and the controversy turns upon the proper meaning of that part of the granting clause which reads as follows: "For the regulation of dynamo electric machinery for the purpose except respecting patent No. 478,344 of regulating motors of its own manufacture." In construing this clause of the agreement we must consider it as a whole, and gather, if we can, the intention of the parties. It will be observed, by an examination of the agreement as originally drawn, that, after reciting that Leonard was the owner or patentee of certain devices for controlling the current of electric generators, among which devices was enumerated patent No. 478,344 (the one in dispute), it grants to Crocker Wheeler Company a license to make, * * * use, sell, and practice for the regulation or control of dynamo electric machinery for the purpose of regulating or controlling electric motors, any of the inventions aforesaid. There is no doubt that, as so drawn, patent No. 478,344 was included in the license as one of the "inventions aforesaid." What, then, if the intention were to have it included, was the object of inserting the words "except respecting patent No. 478,344"? The complainants contend that the exception applies to the entire granting clause, and as qualified by the entire agreement, so that a license is granted to the defendants as to all the patents and applications enumerated therein, excepting patent No. 478,344, as to which no license is granted. The defendants, on the other hand, insist that the exception applies only to a particular part of the agreement, and thereby grants a broad license under No. 478,344 and a restricted license under the other patents. In this latter view the court cannot concur, because, so interpreted, the exception will not harmonize with the rest of the agreement, as it does when applied to the grant. In view of the ambiguity of the contract, the complainants have introduced evidence to show the construction put upon the contract by the defendants after its execution, the communications which took place between the complainants and defendants herein prior to the acquisition by the Bullock Company of the exclusive license to the patent in suit, and what acts have been done by the defendants, or uses they have made of this alleged license of the patent in suit. This testimony shows that Mr. Bullock, of the complainant company, prior to the purchase from Leonard of the exclusive right, inquired of Dr. Wheeler, president of the defendant company, whether the Crocker Wheeler Company had a license to operate or manufacture under the Ward Leonard multiple voltage patents, and that Dr. Wheeler replied that they had never secured a license to operate under this patent. Dr. Wheeler further said that when his company had treated with Leonard for rights to operate under his other patents this one patent, No. 478,344, was excluded, and that they were consulting and negotiating with Leonard at that time for the right to use his multiple voltage patent. The testimony further shows that during the years from 1899 to 1901 the defendant company was trying to purchase from Leonard a license under this patent in suit, and offered Leonard for execution a form of license which recited the fact that Leonard had the right to grant the same. These negotiations were carried on at least seven years after the agreement was entered into, and during all that time it had never been suggested by the defendant that patent No. 478,344 was included in the grant contained therein. It was in 1902, when the complainant the Bullock Company acquired. its exclusive right to the use of the patented device, and it was in 1901 that the defendant company informed the complainant company, after inquiry by the complainants, that they, the defendant company, had no rights to or under this patent; whereupon, and after such inquiry and information, the complainant company did obtain from Leonard its exclusive license. Up to this time not only had the defendant company denied to the complainant company their possession of or right to a license to use this patent, but they had not used or practiced the same under any claim of right or otherwise. From these facts it is apparent that the construction placed upon the agreement by the defendants from the time of its execution until 1901 was that it was not intended to convey any license under patent No. 478,344, but that it was excepted from the grant, and that the defendants under the agreement acquired no rights therein. Dr. Wheeler, who acted for the defendant company in the execution of the contract and throughout all negotiations relating thereto, expressly disclaimed all rights under the agreement to a license under the patent in suit. On the whole case presented the court is of the opinion that no license for the use of this patent in suit passed to the defendant company by the agreement set up in its plea, and that the same must be overruled. The evidence presented on the question of invalidity, noninvention, and anticipation of the patent in suit is inadmissible under the pleadings, and will not be considered at this time. The defendant is given leave to file such answer as it may be advised on or before the rule day in January next. MALLON et al. v. WILLIAM C. GREGG & CO. et al. (Circuit Court, D. Minnesota, Fourth Division. November 11, 1903.) 1. FATENTS-VALIDITY AND INFRINGEMENT-CANE UNLOADING MACHINE. The Mallon patent, No. 583,408, for automatic mechanism for unloading and feeding sugar cane, cannot be considered as covering more than the rake used to move the cane from the car to the conveyor and the mechanism for operating the same, the other elements of the combination being old in the art; and as to such feature it is void for lack of patentable invention, the rake shown being merely an adaption of those previously used for analogous purposes, notably that of the Howard patent for a machine for moving coal in the hold of a vessel to a conveyor, and that of the Lockhart patent for mechanism for moving grain from wagons to a conveyor, which carries it to a threshing machine. The patent also held not infringed, if valid, by the machine of the Gregg patent, No. 670,176. In Equity. Suit for infringement of letters patent No. 583,408, for automatic mechanism for unloading and feeding sugar cane, granted to James Mallon May 25, 1897. On final hearing. George W. Rea, for complainants. A. C. Paul, for defendants. LOCHREN, District Judge (orally). In this case the complainants have a patent for an automatic mechanism for unloading and feeding sugar cane. They claim that the defendants have infringed the patent by the construction, placing upon the market, and sale of a mechanism practically the same as that of the complainants. The defense is twofold: First, that complainants' patent is invalid; that it has been anticipated; that it is simply the same as prior machines that have been in use for similar work; and, second, that the defendants' machine is different in some essential particulars from that of the complainants, and does not infringe. The fact that a patent has been issued to the complainants is prima facie evidence of its validity, but the decision of the Patent Office is not conclusive, and the courts are required to examine into the prior state of the art and ascertain whether in fact the patented device involves invention so as to be patentable. It appears that, prior to the alleged invention of the complainants, sugar cane had been unloaded from the cars in which it was brought to the vicinity of the mills, by being raked from the cars, the sides of the cars being let down, upon a conveyor continually moving; an endless conveyor, as I gather from the statements of counsel, which carried it from the place where it was unloaded into the mill. The change made by the complainants was to place, in the stead of men who were engaged in moving the mass from the car with their rakes, this automatic machine at a convenient place where, by the use of the endless rake, the sugar cane was removed, raked from the car down the slide upon the movable conveyor, and thus passed into the mill, the same as when raked off by hand. J. Mallon-Automatic Mechanism for Unloading and Feeding Sugar CaneNo. 583,408. Now, it is evident, from this statement of what the evidence shows, that the cars and the conveyor form no part of the complainants' invention. They were there before, and had no more to do with the invention than the engine which drew the cars to the place. The invention, if any, consisted in the endless rake in the form in which it was conceived and constructed, and the machinery for handling it and operating it. So that it comes down to the question whether that endless rake of the complainants was something which the claim ed inventor, Mallon, conceived and constructed as something new, or whether it was simply applying an old and well-known device to the performance of that work of removing the cane from the cars. to the conveyor. It appears from patents which are in evidence that endless rakes were old, and used for many purposes before this claimed invention; and that such rakes have been constructed in form much like that of the complainants, at least in two instances, that of Howard and that of Lockhart, being pivoted at the one end to the support, while the other end was free to be raised or lowered; and in working, the loose end, simply by being loose and lying upon the material to be moved, acted by gravity in enabling the material to be seized hold of. It is claimed that it was invention to apply this device, even although it was old, to this new work, with such changes as were necessary to adapt it to the removal of sugar cane from cars, although a similar device had been used for other like purposes before; as for moving coal, in the case of the Howard patent, from the hold of a vessel; or removing unthreshed grain from wagons, as in the case of the Lockhart patent; the material in the latter case being raked upon a conveyor which carried it to a thresher, somewhat similarly to the action of the conveyor upon which the sugar cane was moved to the mill. In the case of the Howard patent, so far as it applied to coal in the hold of a vessel, it moved the coal to the foot of an upright, or nearly upright, elevator, where it dropped into buckets that were being carried up by an endless belt to the discharging point-the dock, or any convenient place. I apprehend that, as far as an invention of this kind is concerned, the rake and the machinery for moving it is the material part of the machine itself; that the manner of fastening it to the place, or selecting the place where it is to be located, depends upon what use it is to be put to, and does not change the character of the machine. It is the same machine, whether planted by the side of a railroad track, so that it will operate upon cars as they come up, or planted where it can reach wagons as they are driven to it, or planted in the hold of a vessel, where it may operate upon the material that is there in cargo suitable to be acted upon. Neither does it seem to me that it involves invention to change the teeth, or scrapers, or flights, or whatever they are called, to adapt them to the material upon which they are to act. The necessity for adapting the scraper to the material is a matter of such common knowledge, and so obvious, that I apprehend no invention is required to advise a person that a different kind of flight or scraper would be needed in moving coal from what' would be proper to use in moving hay or straw. In the case of the moving of coal, something like what we ordinarily understand by the word "scraper" would be proper, while in the case of the moving of hay or straw, something having teeth more like a rake or fork would be required. Perhaps in the case of sugar cane something between the two might be better adapted to the work; but I do not think there would be any difficulty on the part of a mechanic, or anybody having an ordinary acquaintance with such things, in adopting what would be substantially the proper thing. A wide scraper, such as would be proper in moving dirt, or ore, or perhaps coal, would not |