The important question in this case is the operation of the principle of estoppel on the character of defense to which the assignor of a patented invention is limited in a suit for infringement by the assignee. We may first usefully consider the rule that should obtain where the assignment is made after the issue of the patent, and then the difference in the rule, if any, where the assignment was made before the granting of the patent.
Congress under its power to secure for limited times to inventors the exclusive right to their discoveries, has enacted laws conferring such an exclusive right by patent after an application with specification of the invention and claims therefor and a favorable decision by the Commissioner of Patents. The patent of the exclusive right against the public carries with it a presumption of its validity. Agawam Co. v. Jordan, 7 Wall. 583; Blanchard v. Putnam, 8 Wall. 420; Miller v. Eagle Mfg. Co., 151 U.S. 186; Boyd v. Janesville Hay Tool Co., 158 U.S. 260. It is not conclusive but the presumption gives the grant substance and value. By § 4898, Rev. Stats., every such patent or any interest therein shall be assignable in law by an instrument in writing, and the patentee or his assigns or legal representatives may, in like manner, grant and convey an exclusive right under his patent to the whole or any specified part of the United States. The section further provides that an assignment, grant or conveyance shall be void as against any subsequent purchaser or mortgagee for a valuable consideration, without notice, unless it is recorded in the Patent Office within three months from the date thereof. While a seal is not required to make an assignment legal, Gottfried v. Miller, 104 U.S. 521, there seems to be no reason why the principles of estoppel by deed should not apply to assignment of a patent right in accordance with the
There are no cases in this Court in which the application of the principle of estoppel as by deed to the conveyance or assignment of patent property has been fully considered. But there are many in the reports of the Circuit and District Court decisions and in those of the Circuit Court of Appeals. They began as early as 1880 in Faulks v. Kamp, 3 Fed. 898, and were followed by a myriad. The rule supported by them is that an assignor of a patent right is estopped to attack the utility, novelty or validity of a patented invention which he has assigned or granted as against any one claiming the right under his assignment or grant. As to the rest of the world, the patent may have no efficacy and create no right of monopoly; but the assignor can not be heard to question the right of his assignee to exclude him from its use. Curran v. Burdsall, 20 Fed. 835; Ball & Socket Fastener Co. v. Ball Glove Fastening Co., 58 Fed. 818; Woodward v. Boston Lasting Machine Co., 60 Fed. 283, 284; Babcock v. Clarkson, 63 Fed. 607; Noonan v. Chester Park Athletic Co., 99 Fed. 90, 91. There are later cases in nearly all the Circuit Courts of Appeal to the same point. In view of the usual finality of patent decisions in the Circuit Courts of Appeal, this Court will not now lightly disturb a rule well settled by forty-five years of judicial consideration and conclusion in those courts.
As between the owner of a patent and the public, the scope of the right of exclusion granted is to be determined in the light of the state of the art at the time of the invention. Can the state of the art be shown in a suit by the assignee of a patent against the assignor for infringement to narrow or qualify the construction of the claims and relieve the assignor from the charge? The Circuit Court of Appeals for the Seventh Circuit in Siemens-Halske Electric Co. v. Duncan Electric Co., 142 Fed. 157, seems to exclude any consideration of evidence of this kind for such a purpose. The same view is indicated in subsequent decisions of that court. Chicago & Alton Ry. Co. v. Pressed Steel Car Co., 243 Fed. 883, 887; Foltz Smokeless Furnace Co. v. Eureka Smokeless Furnace Co., 256 Fed. 847. We think, however, that the better rule, in view of the peculiar character of patent property, is that the state of the art may be considered. Otherwise the most satisfactory means of measuring the extent of the grant the Government intended and which the assignor assigned would be denied to the court in
Mr. Justice Lurton, when Circuit Judge, speaking for the Circuit Court of Appeals of the Sixth Circuit, in Noonan v. Chester Park Athletic Co., 99 Fed. 90, 91, used this language:
"It seems to be well settled that the assignor of a patent is estopped from saying his patent is void for want of novelty or utility, or because anticipated by prior inventions. But this estoppel, for manifest reasons, does not prevent him from denying infringment. To determine such an issue, it is admissible to show the state of the art involved, that the court may see what the thing was which was assigned, and thus determine the primary or secondary character of the patent assigned, and the extent to which the doctrine of equivalents may be invoked against an infringer. The court will not assume against an assignor, and in favor of his assignee, anything more than that the invention presented a sufficient degree of utility and novelty to justify the issuance of the patent assigned, and will apply to the patent the same rule of construction, with this limitation, which would be applicable between the patentee and a stranger."
Circuit Court of Appeals, First Circuit. Ball & Socket Fastener Co. v. Ball Glove Fastening Co., 58 Fed. 818; Babcock v. Clarkson, 63 Fed. 607; Martin Hill Cash-Carrier Co. v. Martin, 67 Fed. 786, 787. Since the Noonan Case, the view thus announced has been approved in the Circuit Court of Appeals of the Second Circuit in Standard Plunger Elevator Co. v. Stokes, 212 Fed. 941, 943; of the Third Circuit in Roessing-Ernst Co. v. Coal & Coke By-Products Co., 219 Fed. 898, 899; Piano Motors Corporation v. Motor Player Corporation, 282 Fed. 435, 437; of the Fourth Circuit in Leader Plow Co. v. Bridgewater Plow Co., 237 Fed. 376, 377; of the Sixth Circuit in Smith v. Ridgely, 103 Fed. 875; Babcock & Wilcox Co. v. Toledo Boiler Works Co., 170 Fed. 81, 85; United States Frumentum Co. v. Lauhoff, 216 Fed. 610; Schiebel Toy & Novelty Co. v. Clark, 217 Fed. 760, 763; of the Eighth Circuit in Moon-Hopkins Co. v. Dalton Co., 236 Fed. 936, 937; and of the Ninth Circuit in Leather Grille & Drapery Co. v. Christopherson, 182 Fed. 817.
We have been speaking of the application of estoppel in the assignment of patents after they have been granted and their specifications and claims have been fixed. The case before us, however, concerns assignment of an invention and an inchoate right to a patent therefor before the granting of it which, after the assignment at the instance of the assignee, ripened into a patent. Section 4895 of the Revised Statutes authorizes the granting of a patent to the assignee of the inventor. The assignment must be first entered of record in the Patent Office, and in all such cases the application must be made and the specification sworn to by the inventor. It is apparent that the scope of the right conveyed in such an assignment is much less certainly defined than that of a granted patent, and the question of the extent of the estoppel
The art which O'Conor entered was that of a composition of materials for insulating purposes, of leaves of fibrous material like paper superposed one on another and united by an adhesive binder coating the leaves, subjected to heat and pressure and hardened into a compact mass and rendered capable of high resistance to the electric current. In the specification of his patent he disclosed his idea of the defect of the then art, which he proposed to remedy by his process, as follows:
"Heretofore insulation material such as cardboard, composed of layers of paper glued together, has proved more or less unsatisfactory because of various defects, such as absorption of moisture from the atmosphere, inability to resist heat and chemical action, and lack of physical strength. Insulating material . . . must be free from these defects, and, in addition, must possess high dielectric strength."
The 11th and 12th claims were made by the company as assignee after O'Conor had left the company's employ and were not allowed until four years after O'Conor had participated in the making of the composition herein complained of, and for three years thereafter the company made no objection to his continuing the manufacture. But it is said, the assignee was entitled on O'Conor's original specifications to base claims which did not contain as an element the two-step process, because the 6th of his original claims was even broader than the 11th and 12th claims as subsequently made and allowed. It was as follows: "The process of manufacturing insulating material which consists in superposing layers of coated paper and applying heat and pressure thereto." This was promptly rejected by the Patent Office as it must have been in the then state of the art. It was so absurdly broad and all-inclusive as almost to
We are clear then that the estoppel of the 11th and 12th claims against O'Conor does not extend to a single step process such as he has participated in as partner, stockholder or officer; and if it does not affect him, a fortiori does it not affect the respondent company.
This result makes it unnecessary for us to consider the objections that the Formica Company is not affected by an estoppel which would operate against O'Conor, or that the alleged nominal character of the consideration moving to O'Conor can not support an estoppel.