Lucas Machine Tool Co. v. De Vlieg

173 F. Supp. 499, 1959 U.S. Dist. LEXIS 3342
CourtDistrict Court, E.D. Michigan
DecidedMarch 26, 1959
DocketCiv. A. No. 6813
StatusPublished

This text of 173 F. Supp. 499 (Lucas Machine Tool Co. v. De Vlieg) is published on Counsel Stack Legal Research, covering District Court, E.D. Michigan primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Lucas Machine Tool Co. v. De Vlieg, 173 F. Supp. 499, 1959 U.S. Dist. LEXIS 3342 (E.D. Mich. 1959).

Opinion

LEDERLE, Chief Judge.

1. Plaintiff, Lucas Machine Tool Company was an Ohio corporation. Although in 1948 it sold all of its assets to New Britain Tool Company and in 1950 it changed its name to the Mac Investment Company, it has continued, up to the present time, to prosecute this suit under its original name.

2. Associated Patents Inc., (hereinafter called A.P.I.) is an Ohio corporation and is a patent holding company.

3. Plaintiff, New Britain Tool Company is a Connecticut corporation. • Long after the trial (as shown in Finding 66) [500]*500it was determined that this plaintiff had purchased all of the assets of plaintiff, Lucas Machine Tool Company in 1948. Its appearance was not entered until January 1958.

4. Defendant, Charles B. DeVlieg, is a resident of Michigan and holds the controlling interest in the two defendant corporations.

5. Defendant, DeVlieg Engineering Company, is a Michigan corporation, but is inactive.

6. Defendant, DeVlieg Machine Company, is a Michigan corporation.

7. Defendant, Charles B. DeVlieg, prior to 1931, was the inventor of certain “Automatic Positioning Mechanism,” certain “Back Lash Remover” and certain “Power Transmission Mechanism” for which he filed three applications for Letters Patent which resulted in the issuance of Letters Patent No. 1,981,224; No. 2,002,991; and No. 2,029,094.

8. On September 3, 1931, defendant Charles B. DeVlieg granted to the predecessor of plaintiff, Lucas Machine Tool Company, an exclusive license under his inventions later covered by Letters Patent No. 2,002,991 and No. 2,029,094 in the field of boring and drilling machines.

9. Defendant, DeVlieg, prior to 1933, had also granted licenses under his inventions later covered by the three above identified Letters Patent to The Lodge & Shipley Machine Tool Company, the Carlton Machine Tool Company and Brown & Sharpe Manufacturing Company, each license being limited to the specific fields in which these three companies operated.

10. Prior to August 3, 1933, the three companies identified in Finding No. 9, together with plaintiff Lucas Machine Tool Company or its predecessor, the defendant DeVlieg Machine Company and defendant Charles B. DeVlieg, organized plaintiff, A.P.I., each of the five companies owning twenty per cent of the stock.

11. Plaintiff, A.P.I., operated only as a patent holding company, to which defendant, DeVlieg, assigned his three applications for Letters Patent No. 1,981,-224; No. 2,002,991; and No. 2,029.094.

12. On August 3, 1933, representatives of the five stockholder companies of A.P.I. met in Cincinnati, Ohio, in the offices of the lawyers representing The Lodge & Shipley Machine Tool Company to discuss the terms and conditions under which A.P.I. would administer the inventions owned or to be owned by it, and an agreement as of that date was entered into between the parties.

13. The agreement of August 3,1933, provided, among other things, the following :

(a) The agreement was applicable to DeVlieg’s inventions later covered by De-Vlieg’s three Letters Patent listed in Finding No. 11, together with any “improvements or betterments” of said inventions made or controlled by any of the parties to the agreement.

(b) The agreement was to exist until the last of the Letters Patent ever to be owned by A.P.I. expired.

(c) The members were obligated to make prompt disclosure to A.P.I. of any “improvements or betterments” of the subject matter of the inventions owned by A.P.I. and to assign the same to A.P.I.

(d) A “Declaration of Uses” was provided which set forth the specific machine tool field in which each member could operate exclusively, and each member was exclusively licensed in its exclusive field under all patents owned or to be owned by A.P.I.

(e) Plaintiff, Lucas Machine Tool Company was assigned the field relating to all horizontal boring, drilling and milling machines.

(f) Defendant, DeVlieg Machine Company, was assigned to the field relating to milling and broaching machines.

(g) Each member agreed to pay A.P.I. a royalty for operating under the patents in its specific field.

(h) A.P.I. had the sole right to extend the field of any member, provided it did not conflict with the field of any other member, unless consented to by such other member.

[501]*501(i) A.P.I. was to defend all suits brought against any of the members for infringement because of their manufacture of machines in their exclusive fields, which included any inventions owned by A.P.I.

(j) A.P.I. could grant non-exclusive licenses under its patents to strangers, but only in fields not allocated to any of the five members.

14. At the time this suit was filed, A.P.I. owned the following ten patents:

15. On December 16, 1941, Letters Patent No. 2,666,647 for “Horizontal Boring Machine” was issued to plaintiff, Lucas Machine Tool Company, as assignee of the inventors Lucas and Stephan.

16. On January 18,1944, Letters Patent No. 2,339,435 for “Machine” was issued to plaintiff, Lucas Machine Tool Company, as assignee of Stephan.

17. Neither of these patents were assigned by plaintiff, Lucas Machine Tool Company, to A.P.I. although Letters Patent No. 2,339,435 disclosed and claimed certain means for automatic positioning which was an “improvement or betterment” of A.P.I.’s Letters Patent No. 1,-981,224.

18. In 1940 defendant, DeVlieg Machine Company, needed two horizontal boring machines to be used in its war effort.

19. It was unable to obtain these machines from plaintiff, Lucas Machine Tool Company, so this defendant decided to build the machines and defendant De-Vlieg began designing the same.

20. Plaintiff, Lucas Machine Tool Company, through its president, Henry Lucas, was notified of defendant’s intentions and Henry Lucas advised defendants that it was the logical thing to do.

21. By April of 1941 defendant De-Vlieg had completed drawings showing the design of his horizontal boring machine and had supplied Henry Lucas with a set of said prints, and on a visit to Detroit by Henry Lucas the design had been discussed in detail with him.

22. On September 27, 1941, defendant DeVlieg Machine Company had completed its first horizontal boring machine and Henry Lucas was notified of that fact and photographs of the machine were sent to him.

23. Defendant, DeVlieg, advised Henry Lucas that great pressure was being placed upon him to manufacture his hori[502]*502zontal boring machine for others to assist in the war effort.

24. Henry Lucas in the latter part of 1941 again visited the defendant, De-Vlieg Machine Company, and, at that time, saw the completed horizontal boring machine which was known thereafter as the DeVlieg “Jigmil”.

25. Plaintiff, Lucas Machine Tool Company, has always manufactured and sold horizontal boring machines only wherein the spindle extended longitudinally of the bed of the machine.

26. Lucas patent No. 2,266,647 was based upon a horizontal boring machine known as “Lucas No. 61” and made in about the year 1936, but not sold by Lucas, wherein the spindle extended transversely of the bed of the machine.

27.

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173 F. Supp. 499, 1959 U.S. Dist. LEXIS 3342, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lucas-machine-tool-co-v-de-vlieg-mied-1959.