New Discoveries, Inc. v. Wisconsin Alumni Research Foundation

13 F. Supp. 596, 1936 U.S. Dist. LEXIS 1496
CourtDistrict Court, W.D. Wisconsin
DecidedJanuary 28, 1936
Docket71
StatusPublished
Cited by14 cases

This text of 13 F. Supp. 596 (New Discoveries, Inc. v. Wisconsin Alumni Research Foundation) is published on Counsel Stack Legal Research, covering District Court, W.D. Wisconsin primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
New Discoveries, Inc. v. Wisconsin Alumni Research Foundation, 13 F. Supp. 596, 1936 U.S. Dist. LEXIS 1496 (W.D. Wis. 1936).

Opinion

STONE, District Judge.

This is a suit in equity brought by New Discoveries, Inc., against the Wisconsin Alumni Research Foundation. The complaint, after the formal allegations as to the residence1 and incorporation of the parties, alleges that the plaintiff and the defendant are the owners of patents relating to the process of producing Vitamin D; that the plaintiff is now engaged in the business of selling and merchandising licenses for the manufacture and use of its process for the production of Vitamin D under its patents, and that the defendant has contended, and does now contend that the use of the processes as defined in plaintiff’s patents constitutes an infringement upon the rights of the defendant by reason of its ownership in its two patents; that the defendant has continually stated, and does now state to the plaintiff and other persons that if any of the processes described in plaintiff’s patents were used by plaintiff or its licensees, they would infringe upon defendant’s patents; that the defendant has stated, orally and by letter, to various persons who had become licensees of the plaintiff, that in the event that such persons used the processes claimed and described in plaintiff’s patents, they would be liable for damages to defendant for infringement of its patents; and that proceedings would be taken against them. The complaint alleges on information and belief that defendant has not at any time intended and does not now intend to prosecute any proceedings involving the validity of its patents involved herein on the questions of infringement, to final decree and adjudication. It is alleged that as a result of the acts of the defendant, plaintiff has suffered irreparable damage in that it has been unable to obtain profits which would accrue to it if it were able to sell or merchandise licenses under its patents; that the benefits of Vitamin D are now widely known, and *598 that many persons throughout the entire country have told plaintiff that they desire to purchase licenses from plaintiff, but that they will not do so because of threats of suit for infringement made by defendant; and that unless plaintiff will be free to sell and merchandise its licenses, unhindered by defendant’s threats, it will suffer great and irreparable damages.

The complaint alleges the general invalidity of defendant’s patents: First, because the processes set forth were, neither new nor original; secondly, because the disclosures made in the patent were incomplete and not definite; and, third, because the patents involved principles that were purely scientific and not the proper subject-matter for a patent.

The prayer of the complaint is that the court declare the rights of the plaintiff and the defendant herein, and their legal relations in connection with the subject-matter of the controversy as between plaintiff and defendant; that defendant’s two patents be declared invalid by the court; and that the defendant be restrained from in any way interfering with the plaintiff’s right to sell and merchandise licenses for the manufacture and use of the process of producing Vitamin D by sunlight or ultra-violet rays, from publishing, informing, or. claiming that the plaintiff, by selling and merchandising licenses for the use of said processes, is in any way infringing on defendant’s patents, and from interfering with any proposed licensees of the plaintiff.

Defendant’s motion to dismiss the bill states in detail the grounds for dismissal. Generally speaking, these grounds group themselves into the following classifications :

(1) Insufficiency and want of equity as a result of numerous defects appearing on the face of the complaint, and failure of the complaint to state a cause of action in equity, disregarding the federal declaratory judgment 'statute.

(2) Failure of the bill of complaint to state a cause of action within the federal declaratory judgment statute.

(3) Unconstitutionality of the federal declaratory judgment statute if it creates a cause of action upon the facts stated in the bill of complaint.

The bill of complaint fails to allege any infringement of plaintiff’s patents by the defendant. It does not state a cause of action of unfair competition. There is no allegation that the parties are in competition in business, or that the patents are being used by either of the parties. Inasmuch as the parties are not competing with one another, there can be no unfair competition.

The allegation of the complaint is insufficient to charge the defendant with malice or bad faith in the alleged threats made to commence prosecution for infringement of its patents.

Does the bill of complaint state a cause of action within the federal declaratory judgment statute? The statute provides, in part:

“(1) In case of actual controversy the courts of the United States shall have power, upon petition, declaration, complaint, or other appropriate pleadings to declare rights and other legal relations of any interested party petitioning for such declaration, whether or not further relief is or could be prayed, and such declaration shall have the force and effect of a final judgment or decree and be reviewable as such.” Jud.Code, § 274d, 28 U.S.C.A. § 400 and note.

It is necessary, at the outset, to determine if the complaint alleges that there is an actual controversy existing between the parties. The insertion of the word “actual” in the statute means that the court is to deal with realities, and not with an imaginary set of facts. The complaint contains no allegation that plaintiff, or its alleged licensees are in 'fact using the processes described in the plaintiff’s patents. There is no allegation that any one is infringing defendant’s patents. It follows that there is no one now in existence whom defendant could prosecute' an infringement action against. In the absence of infringement actually existing, there can be no actual controversy between the parties. The dispute between the parties, if any, is purely academic, and based upon a purely hypothetical statement of facts that are contingent, uncertain, and may never exist.

The fact that defendant may have-notified plaintiff or others that the use of plaintiff’s processes would constitute an infringement of defendant’s patents does not give rise. to an actual controversy. Notice to a competitor that he is infringing is the usual and ordinary procedure followed by patentees, and is not to be- *599 condemned when characterized by good faith. Oil Conservation Engineering Company v. Brooks Engineering Company (C.C.A.) 52 F.(2d) 783.

What the. plaintiff seeks in this action is to have the court declare that the plaintiff and its licensees would have a good defense if and when the defendant commenced an infringement action against it, which defendant may or may not do. Tt inquires what the court’s judgment would be if it used or permitted others to use the processes described in its patents. The court should not he asked to decide moot cases, give legal advice, or render ati advisory opinion. The declaratory judgment statute was not enacted for that purpose.

Actions for declaratory judgments are in the nature of a summary action, and are ordinarily limited to cases where facts are simple or stipulated; to settle disputes relating to the interpretation of statutes and construction of wills and contracts.

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Bluebook (online)
13 F. Supp. 596, 1936 U.S. Dist. LEXIS 1496, Counsel Stack Legal Research, https://law.counselstack.com/opinion/new-discoveries-inc-v-wisconsin-alumni-research-foundation-wiwd-1936.