New Marshall Engine Co. v. Marshall Engine Co., 223 U.S. 473 (1912)
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New Marshall Engine Company v. Marshall Engine Company
No. 107
Submitted December 15, 1911
Decided February 19, 1912
223 U.S. 473
ERROR TO THE SUPERIOR COURT
OF THE STATE OF MASSACHUSETTS
Syllabus
The federal courts have exclusive jurisdiction of all cases arising under the patent laws, but not of all questions in which a patent may be the subject matter of the controversy. Courts of a state may try questions of title and construe and enforce contracts relating to patents. Wade v. Lawder, 165 U.S. 624.
A suit to compel assignment of a patent and to enjoin manufacturing and sale of article covered thereby because the patent is an improvement on an earlier one and included in a covenant to convey all such improvements is based on general principles of equity, and is within the jurisdiction of the state court.
Where the injunction granted against sale of articles manufactured under a patent is only an incident to a decree for specific performance of a contract to convey the patent as an improvement of an earlier one, the relief is appropriate, and, if it does not determine questions of infringement, is within the jurisdiction of the state court.
203 Mass. 410 affirmed.
On June 1, 1886, Letters Patent 342,802, were issued to Frank J. Marshall for an improvement in pulp-beating engines. Shortly before the patent expired, he organized the Marshall Engine Company, and on September 15, 1902, assigned to it the patent and "all improvements thereon and renewals of the same." Marshall was elected president of the company, but neglected to have the assignment recorded within the time required by law. It contained, however, a provision for further assurance, and on October 8, 1904, after the patent had expired, Marshall executed an additional instrument whereby, after reciting the former assignment, he transferred the patent and "all further improvements thereon and renewals thereof."
In September, 1903, at the time the first assignment was made, Marshall had on file an application for a patent on "an improvement on patent 411,251, granted to E. R. Marshall, and embodies features shown in patent 342,802, granted in 1886 to myself." There is no further reference in the record to patent 411,251. Marshall’s application was granted, and on April 14, 1903, Letters Patent 725,349 were granted to him.
No formal assignment was made, but it is found as a fact that, between September 15, 1903, and the receivership, the complainant manufactured nine or ten engines embodying the improvement covered by patent 725,349.
On June 13, 1905, a receiver was appointed for the Marshall Engine Company. Immediately thereafter, Marshall organized under the laws of Massachusetts a new company bearing his name, and assigned to it this patent 725,349. The New Marshall Engine Company took with notice of the complainant’s right.
The Marshall Engine Company, of New Jersey, claimed title to this patent 725,349 as an "improvement" on patent 342,802, which passed by virtue of the assignment of September 15, 1902. It thereupon filed, through its receiver, a bill in the Superior Court of Franklin County, Massachusetts, asserting this title and praying that the defendants, Marshall and the New Marshall Engine Company, should be required to execute and deliver to it an assignment in due form to patent 725,349, so as to entitle it to be recorded in the Patent Office, and also that the defendants, their successors and assigns should be enjoined from manufacturing or selling machines covered by patent 725,349.
The defendants answered, admitting or denying the several allegations of the bill, but setting up no affirmative defense. The case was referred to a master, who found in favor of the complainant. Thereupon the defendants moved to dismiss the bill because
it presents questions involving an inquiry as to the construction and scope of the patents therein mentioned, of which questions the federal courts have exclusive jurisdiction.
The motion was overruled, and a final decree was entered in favor of the complainants. The decision was affirmed by the Supreme Judicial Court of Massachusetts, and the case was brought here by writ of error.