Dr. Salsbury's Laboratories v. I. D. Russell Co. Laboratories

212 F.2d 414
CourtCourt of Appeals for the Eighth Circuit
DecidedMay 13, 1954
Docket14967_1
StatusPublished
Cited by9 cases

This text of 212 F.2d 414 (Dr. Salsbury's Laboratories v. I. D. Russell Co. Laboratories) is published on Counsel Stack Legal Research, covering Court of Appeals for the Eighth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Dr. Salsbury's Laboratories v. I. D. Russell Co. Laboratories, 212 F.2d 414 (8th Cir. 1954).

Opinion

COLLET, Circuit Judge.

This is an action for active inducement to infringe and contributory infringement of a patent, wherein plaintiff prays both treble damages and injunc-tive relief. From a summary judgment entered in favor of defendant by the District Court below, plaintiff appeals.

The factual background surrounding the alleged infringement is not new to *415 this court. In I. D. Russell Co. v. Dr. Salsbury’s Laboratories, 8 Cir., 1952, 198 F.2d 473, we held under identical facts that plaintiff’s own patent misuse effectively barred recovery. It is plaintiff’s instant contention that, as a result of legislation enacted subsequent to the earlier litigation, the law of misuse has been changed, thereby creating this, a new cause of action for continuing infringement. Defendants deny that a change in the law has been effected and insist, inter alia, that res judicata necessitated the summary judgment here in question.

The District Judge, in his memorandum opinion sustaining defendant’s motion, stated:

“It is my impression that none of the questions raised by the defendants is of importance at this time, except that of res judicata and the alleged changing of the law subsequent to the final determination of this case.
“If the law has been changed, and as a result of that change a violation since January 1, 1953, the plaintiff would have a cause of action. If there has been no change in the law, or if the change in the law does not affect the cause of action here, then the plaintiff cannot prosecute this action, and the motion must be sustained.”

We are in complete accord with this statement of the question, it being in effect admitted that plaintiff is entitled to recovery for infringement upon purgation of its previous misuse.

To grasp the nature of the misuse heretofore adjudicated, it will be recalled that plaintiff is the producer of a “Poultry Treatment Composition”, which it sells under the trade name “Renosal”. This product is sold in both powder and tablet form and, when mixed with prescribed amounts of water by the purchaser, is effective in treating a poultry disease known as cecal coccidiosis and in stimulating poultry growth. It is this product, when diluted and ready for ingestion, on which plaintiff obtained its patent. Defendants’ product, sold under the trade names Korum and Zuco, is for all relevant purposes identical in composition and manner of use.

We shall not undertake to discuss extensively the component physical characteristics of the parties’ respective products, as this has already been done adequately in the previous opinion of this court. However, it was adjudicated upon prior appeal, and we reiterate once more, that the products in question consist essentially of a 3-nitro-4-hydroxy phenyl arsenic acid mixture operating, when dissolved, within a regulated concentration range. Though plaintiff again argues that its Renosal and defendants’ Zuco and Korum are not the chemical raw material, 3-nitro, it was nevertheless pointed out with sufficient clarity in the earlier opinion that it is 3-nitro which the parties in effect are selling. Whatever may be plaintiff’s contention as to the change effected in the laws of misuse, it will not now be heard to try on appeal the factual issues heretofore adjudicated. We previously said, and here repeat:

“The patent is for a composition of two unpatented substances, water and 3-nitro. * * *
“So, also, is plaintiff’s contention without merit that in selling 3-nitro, an unpatented article, under the trade name of Renosal, and by restricting its use, except under the patent by directions on the label, the 3-nitro thus becomes identified with the patent and is no longer a common raw material but that it becomes an entity within the patent.” I. D. Russell Co. v. Dr. Salsbury’s Laboratories, 8 Cir, 198 F.2d 473, 474-475.

We bear in mind, therefore, that plaintiff is selling 3-nitro and is in effect complaining of defendants’ sale of the same unpatentable material. This is not to say that other dilutive ingredients are not used in the final ingestible composition, but it was held in the earlier opinion, and we merely note here, that the *416 3-nitro sold does not become by restrictive use so identified with plaintiff’s patent at to lose its characteristics as a common raw material. As we said then, “Even if such magical transformation is true as to Renosal, it does not apply to 3-nitro sold by others.” Since plaintiff’s only serious defense against res judicata is that a change in the law has been effected, we direct our inquiry solely to the legal question raised. Admittedly, if there has been a decisive change in the law of misuse, plaintiff properly states a new cause of action. Commissioner of Internal Revenue v. Sunnen, 333 U.S. 591, 68 S.Ct. 715, 92 L.Ed. 898.

An impressive array of authorities has held that whatever may be a patentee’s property rights in his patent, he cannot be permitted to control by monopoly unpatentable material used as an essential component part of the patented combination. Such improper monopoly, if exerted, amounts to misuse of the patent granted. In Carbice Corporation of America v. American Patents Corp., 283 U.S. 27, 31-32, 51 S.Ct. 334, 335, 75 L.Ed. 819, cited in our earlier opinion, Justice Brandeis stated:

“The limited monopoly to make, use, and vend an article may not be ‘expanded by limitations as to materials and supplies necessary to the operation of it.’ Motion Picture Patents Co. v. Universal Film Mfg. Co., 243 U.S. 502, 515, 37 S.Ct. 416, 420, 61 L.Ed. 871. Compare United Shoe Machinery Corp. v. United States, 258 U.S. 451, 462, 42 S.Ct. 363, 66 L.Ed. 708; United States v. General Electric Co., 272 U.S. 476, 492, 47 S.Ct. 192, 71 L.Ed. 362.
“ * * * it was held that to permit the patent-owner to ‘derive its profit, not from the invention on which the law gives it a monopoly, but from the unpatented supplies with which it is used’ is ‘wholly without the scope of the patent monopoly.’ * * * If a monopoly could be so expanded, the owner of a patent for a product might conceivably monopolize the commerce in a large part of unpatented materials used in its manufacture.”

See also Mercoid Corp. v. Minneapolis-Honeywell Regulator Co., 320 U.S. 680, 64 S.Ct. 278, 88 L.Ed. 396.

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212 F.2d 414, Counsel Stack Legal Research, https://law.counselstack.com/opinion/dr-salsburys-laboratories-v-i-d-russell-co-laboratories-ca8-1954.