Bethlehem Steel Co. v. United States

53 Ct. Cl. 348, 1918 U.S. Ct. Cl. LEXIS 140, 1918 WL 999
CourtUnited States Court of Claims
DecidedApril 8, 1918
DocketNo. 28693
StatusPublished

This text of 53 Ct. Cl. 348 (Bethlehem Steel Co. v. United States) is published on Counsel Stack Legal Research, covering United States Court of Claims primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Bethlehem Steel Co. v. United States, 53 Ct. Cl. 348, 1918 U.S. Ct. Cl. LEXIS 140, 1918 WL 999 (cc 1918).

Opinion

Booth, Judge,

reviewing the facts found to be established, delivered the opinion of the court.

The Bethlehem Steel Company, a corporation organized under the laws of the State of Pennsylvania, brings suit to recover royalties for the use of a patented invention by the defendants. The patent in suit was the creation of Mr. Owen F. Leibert, an employee of said company, and for which he was granted letters patent No. 516768 on March 20, 1894, assigning the same to said company on March 27,1894. At the time said letters patent were granted the Bethlehem Iron Company, which subsequently by proper transfer became the Bethlehem Steel Company, was engaged in the manufacture for the defendants of 100 guns of various sizes under a contract made in 1891. The Bethlehem Iron Company, recognizing the importance of Leibert’s invention, immediately after his application for letters patent, communi[356]*356cated in writing with the Ordnance Department of the Government calling their attention to Leibert’s invention and requesting the department through the Secretary of War to urge the Commissioner of Patents to make said application special and thereby expedite its consideration. The Secretary of War preferred the request and it was granted. In February, 1894, the Bureau of Ordnance requested the Bethlehem Iron Company to furnish it full and complete information as to the Leibert invention, which was accordingly done, and, thereafter, in June, 1894, the bureau asked special leave to use said invention for experimental purposes on a 12-inch gun the defendants were then manufacturing at their Watervliet Arsenal, without the payment of compensation. In July following the company granted the request and the defendants prepared for said purpose full plans and drawings of the Leibert device. Almost four years elapsed between the preferring of the above request and a decision as to the form of breech mechanism to be used, in so far as this record discloses, the time being consumed in experimentation with many patented devices. During this period Mr. John W. Stockett, the Ordnance Bureau’s chief draftsman, designed a modified form of the Leibert mechanism, upon some of the features of which he secured letters patent, as shown in the findings, known in the department as “ Model 1895.” The Stockett “ Model 1895 ” was finally used at the Watervliet Arsenal. Contemporaneous with this transaction was the manufacture by the Bethlehem Iron Company of the 100 guns before mentioned for the defendants under its contract of 1891 and the question of the type of breech mechanism to be used was becoming important. Without entering into detail it is now only important to say that on the last 15 guns manufactured under said contract, Model 1895 ” was manufactured and used by the company and for said use compensation was paid by the company to Mr. Stockett.

In August, 1901, the Bethlehem Iron Co. became the Bethlehem Steel Co., and Congress on June 6, 1902, by special legislation, authorized the substitution of the steel company for the iron company in all contracts then in course of ex[357]*357ecution except the contract of 1891. On November 5, 1902, tbe plaintiff company in a written communication to the Chief of Ordnance called his specific attention to the fact that the patented invention then being used by the company was in fact the Leibert patent, and directed the attention of the defendants to a similar fact in connection with the manufacture by the department of certain other guns at other places. The letter concludes with a request for an opportunity to present this matter fully to the defendants. The chief of the bureau responded by saying that the claims of the Leibert patent were so much involved with other and similar devices that it was impossible for the bureau to decide the “ legal aspect of the case,” and concluded by requesting the company to institute suit to determine the question.

The plaintiff’s cause of action is necessarily ex contractu. It is a jurisdictional issue and must be first disposed of. The defendants contend in the first instance that the recited facts make out a case sounding in tort and hence the petition must be dismissed. The line of distinction between the two contentions has been clearly determined by the Supreme Court in numerous cases. The difficulty is more in the application than the ascertainment of the rule. If the facts bring the parties in such a relationship that the court can imply from their conduct and sayings an agreement to pay for the use of the invention, then the action is providently brought and may be sustained. From cases heretofore adjudicated upon similar principles it may be safely asserted that where the Government uses a patented invention “with the consent and express permission of the owner ” and does not “ repudiate the title of such , owner,” an implied contract to pay a reasonable compensation for such usage arises. As was said by Mr. Justice Brewer in Berdan Fire Arms Co. v. United States, 156, U.S., 522, 567:

“While the findings are not specific and emphatic as to the assent of the Government to the terms of any contract, yet we think they are sufficient. There was certainly no denial of the patentee’s rights to the invention; no assertion on the part of the Government that the patent was wrongfully issued; no claim of right to use the invention regardless of the patent; no disregard of all claims of the patentee, [358]*358and no use in spite of protest or remonstrance. Negatively, at least, the findings are clear.”

Mr. Justice McKenna in United States v. Sociéte Anonyme, etc., 224 U. S., 320, in discussing the elements necessary for the derivation therefrom of an implied agreement in a case strikingly similar to the present one, uses this language:

“ But these elements do not have to appear by the express declarations of the parties. They may be collected from their conduct. The alternative of a contract is important to be kept in mind. The officers of the Government knew of the De Bange invention and were aware of its great importance, and the purpose to deliberately take property of another without the intention that he should be compensated — in other words to do plainly a wrongful act — can not be imputed to them without the most convincing proof. Such proof does not exist in the present case. On the contrary, the record shows that compensation was contemplated. There was doubt as to the extent of it because there was doubt as to how far”the devices used were attributable to or belonged to De Bange or whether they constituted an infringement of his patent, and therefore there was hesitancy and doubt, not as to compensation, but as to the amount and extent of it.”

The findings in this case seem to bring it clearly within the rule of an implied contract. A resume of the entire transaction negatives any intention of the Government to infringe the plaintiff’s patent. The Ordnance Bureau was searching for the most efficacious device known to the inventive world to apply to its guns as a substitute for the one in use, a device performing a function of inestimable value in guns of the character here involved. Not alone were experiments being conducted to ascertain the value of plaintiff’s device but at least three other patented inventions conceived by strangers to this record were being carefully investigated.

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Cite This Page — Counsel Stack

Bluebook (online)
53 Ct. Cl. 348, 1918 U.S. Ct. Cl. LEXIS 140, 1918 WL 999, Counsel Stack Legal Research, https://law.counselstack.com/opinion/bethlehem-steel-co-v-united-states-cc-1918.