APPEAL FROM THE CIRCUIT COURT OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF CALIFORNIA.
MR. JUSTICE BLATCHFORD, delivered the opinion of the court.
This is a suit in equity, brought April 19, 1878, in the Circuit Court of the United States for the District of California,
by George W. White, a citizen of California, against Ira P. Rankin, A. P. Brayton, John Howell and James M. Thompson, citizens of California, for the infringement of letters patent No. 44,145, granted to George W. White and Austin G. Day, as assignees of George W. White, the inventor, September 6, 1864, for seventeen years from August 23, 1864, for an "improved apparatus for roasting and reducing ores;" and also for the infringement of letters patent No. 46,287, granted to George W. White, as inventor, February 7, 1865, for seventeen years from that day for an "improved apparatus for calcining ores." All of the interest of Day in patent No. 44,145 was conveyed by him to White before September 20, 1876.
The bill is in the usual form of bills in equity for the infringement of letters patent. It alleges that the defendants, since September 20, 1876, and before the filing of the bill, without the license of the plaintiff and without any right so to do, have manufactured, used and sold machines embracing the inventions covered by both of the patents and infringing the same. It contains no mention of, or reference to, any contract with the defendants for their use of either of the patents. The prayer of the bill is in the usual form, for a perpetual injunction, an account of profits, an assessment of damages and an increase of the latter to an amount not exceeding three times the sum at which they shall be assessed. It also prays for a discovery from the defendants as to the number of furnaces they have made since September 20, 1876, how the same were constructed, whether they have not on hand a large number, and how many, of such furnaces, and how the same are constructed.
The defendants demurred to the bill on the ground that it showed no case for a discovery or for relief, and that the discovery demanded was in aid of the enforcement of a penalty. The demurrer was sustained as to discovery, with leave to the plaintiff to amend. The bill was then amended by striking out the prayer for an increase of damages and by waiving all right to a penalty.
The defendants then put in a plea to the bill, setting up that the plaintiff, on February 13, 1875, agreed in writing to assign
to the defendant Thompson a one-fourth interest in the two patents in question, with a corresponding one-fourth interest in all patents that the plaintiff might thereafter obtain for improvements made by him on said inventions, and a corresponding interest in all reissues and extensions of said patents, in case Thompson should, within sixteen months thence ensuing, elect to take the said assignment; that within the sixteen months Thompson elected to take it, and in due time thereafter performed every act necessary to entitle himself to it, and duly demanded of the plaintiff the execution and delivery of the said assignment, to which Thompson became entitled as of June 13, 1876; that the plaintiff White failing to execute and deliver the same to Thompson on demand, the latter, on August 31, 1876, brought suit against White in the District Court of the 19th Judicial District of California, in and for the city and county of San Francisco, to compel a specific performance of the said contract and for other relief; that White appeared and defended the suit; that the issues raised by the pleadings were duly tried and determined by the said District Court, which, on November 22, 1877, made a decree containing the following findings of fact: (1) That the contract set up in the complaint of Thompson was made between the parties; (2) that Thompson made to White a loan of $1000, and delivered to White a note and agreement mentioned in the contract, and received from White his notes for $1000; (3) that Thompson elected to take the assignment of one-fourth of the patent rights mentioned in the contract, and made known to White his said election before and upon the expiration of the sixteen months; (4) that at the expiration of that time, Thompson, at San Francisco, with reasonable diligence sought White for the purpose of demanding from him an assignment of one-fourth of the said patent rights, and prepared to tender and deliver to White, in payment therefor, White's said notes and Thompson's assignment of the income of the said one-fourth, in accordance with the terms of the contract; (5) that White knew of Thompson's purpose and evaded him; (6) that, at the expiration of the sixteen months, Thompson, by writing addressed to and received by White,
demanded an assignment of one-fourth of the said patent rights, and offered to pay the consideration and perform the conditions imposed upon him by the contract; (7) that, on July 11, 1876, Thompson made to White a personal tender of White's said notes and an assignment of the income of said one-fourth, and demanded from White an assignment of the one-fourth; (8) that White made no objections to any of the said offers or tenders of performance; (9) that, between the first offers of performance and the commencement of that suit, on September 1, 1876, Thompson made efforts to settle the matter without litigation; (10) that Thompson, at the expiration of the sixteen months, was, and ever since had been and still was, willing and ready to perform the conditions on his part to entitle him to the assignment of the said one-fourth, and in due time made tender of performance; that, from such findings of fact, the court was of opinion, as a conclusion of law, that Thompson was entitled to an assignment of one-fourth of said patent rights as of June 13, 1876, and to an account; that thereupon it was decreed (1) that White execute and deliver to Thompson a proper deed transferring and assigning to him, as of June 13, 1876, a one-fourth interest in the two inventions secured by the said two patents, with a corresponding interest in all patents that White might have obtained since February 13, 1875, or might thereafter obtain, on improvements made by him on said inventions, and a corresponding interest in all reissues and extensions of said patents; (2) that Thompson, on the delivery of such deed, should surrender to White his said notes, and execute and deliver to him an assignment of the income of said one-fourth, to run for the period of two years from June 13, 1876, unless the sum of $4000 should be sooner realized; and (3) that if White should fail, for five days from the date of the decree, to obey it, then the clerk of the court, as special commissioner, should execute and deliver the deed to Thompson, and receive for White the notes and assignment of income; that it was referred to a commissioner to ascertain and report certain matters, and among them the profits lost and the damages sustained by Thompson since June 13, 1876, in consequence
of White's failure to make the assignment; that, White having failed for more than five days after the entry of the decree to execute and deliver the assignment, the special commissioner, on January 31, 1878, received for White from Thompson the notes of White and the assignment of income mentioned in the decree, and executed and delivered to Thompson a deed transferring to the latter, as of June 13, 1876, a one-fourth interest in the two inventions secured by the said two patents, with a corresponding one-fourth interest in all patents that White might have obtained since February 13, 1875, or might thereafter obtain, on improvements theretofore or thereafter made by White on said inventions, and a corresponding interest in all reissues and extensions of the patents; that that deed was duly recorded in the Patent Office; that the other commissioner, before referred to, took depositions as to the account, and on October 25, 1880, returned them and his report to the Superior Court of the city and county of San Francisco, which by law had superseded the said District Court; that the cause came on for hearing ...