Price v. Block

124 F.2d 738, 52 U.S.P.Q. (BNA) 7, 1941 U.S. App. LEXIS 2580
CourtCourt of Appeals for the Seventh Circuit
DecidedDecember 13, 1941
DocketNo. 7595
StatusPublished

This text of 124 F.2d 738 (Price v. Block) is published on Counsel Stack Legal Research, covering Court of Appeals for the Seventh Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Price v. Block, 124 F.2d 738, 52 U.S.P.Q. (BNA) 7, 1941 U.S. App. LEXIS 2580 (7th Cir. 1941).

Opinion

SPARKS, Circuit Judge.

By this action appellant sought equitable relief upon the following facts alleged in the complaint: There is diversity of citizenship, and more than $3,000 is alleged to be involved. Julian D. Block was a chemical engineer and a citizen of Illinois. He disclosed to appellant certain mechanical and chemical developments, to wit: a dye stripping process for bleaching, reclaiming and redyeing woolens, silks and other fabrics; a process for the manufacture of synthetic sugar; a process for the decaffeinization of coffee; and a process for the generation of hydrogen gas from water. The first three were patented.

Block made a verbal offer to appellant that if he would secure the financing of the [740]*740synthetic sugar by means of securing a sale of that patent and formulas outright, or if appellant were able to secure and carry out a royalty contract, or to secure and carry out the formation of a company that would carry on the production and manufacture of the sugar, Block would turn over to appellant one-half interest in that patent and processes, and would divide equally all profits derived therefrom, or in case of the formation of a company for such purposes, Block would divide equally with appellant any stock received by Block in the company.

Appellant alleges that he accepted the verbal offer and did within the month following secure parties willing and financially able to close a deal under any one of the plans offered by Block, provided Block would furnish a chemical test or demonstration of his ability to produce synthetic sugar by his patented process. Block fixed the date for such test as of July 17, 1938, and notified appellant. When appellant came to Chicago on that date for observing the test and closing the deal, Block told him that he would neither make the test nor close the deal until he had completed his hydrogen gas development and its demonstration; that the sugar could wait, and if Block were not there, his sons could carry it on as they had full knowledge of the process and were able to make the test and demonstration.

Thereupon Block detailed to appellant his success in the development and control of his hydrogen gas. He said that he needed a demonstrating model in order to establish his ability to easily and cheaply generate and control such gas; and that he was financially unable to secure the model, or to protect his disclosures by patent. Thereupon he offered appellant one-half interest in the secrets and processes and the contemplated patents relating thereto, and also one-half interest in all profits therefrom, as a joint adventure in the production and development of the gas, if appellant would advance $5,000 as his portion of such joint adventure. Block said he would not want the entire sum at once, but only as the development progressed. He said it would be used by him for the materials in making the model, and would also cover the costs for drawings, searches, attorneys’ fees and necessary expenses in securing the patents. Block further stated that he would build the model and furnish all of his secret experiments and information, but that appellant would have to see to the financing or commercializing thereof, as he was too sick to attend to such details.

Thereupon appellant accepted Block’s verbal offer and pursuant thereto paid to Block on the following dates the respective amounts set forth:

September 20, 1938, $2500.

October 10, 1938, 1000.

January 31, 1939, 1200.

February 21, 1939, 300.

$5000.

On February 14, 1939, Block had not yet taken steps to secure the patent relating to the gas, and expressed to appellant a desire that he furnish a contract that would authorize appellant to carry on negotiations, and for financing and commercialization purposes as soon as the protection of the patent applications was completed. Appellant had an attorney prepare a contract which was not satisfactory to either Block or appellant, and on March 11, 1939, Block submitted a contract which both signed, as follows:

“For and in consideration of the sum of five thousand dollars in hand paid, receipt of which is hereby acknowledged, I, D. Julian Block, hereby grant to Don W. Price of 4840 Kenmore Avenue, Chicago, Illinois, the exclusive option for one year on a process for generating a propulsive gas from water, said process now being in its experimental states.
“It is further agreed between the signatories hereto that any and all profits arising from the mutually satisfactory commercialization of this process, or further developments thereof, by Mr. Price shall be shared equally and divided between the said Don W. Price and D. Julian Block.
“This document is submitted in duplicate and acceptance hereof will constitute a full and sufficient agreement between the parties hereto, and shall be binding upon the heirs or assigns of both signatories.
“D. Julian Block.
“Accepted by Don W. Price.”

When decedent received the patent upon his decaffeinizer he sent the letters patent to appellant for the purpose of having him proceed with financing the disclosure.

Block died on April 8, 1939, and left as his only heirs at law his widow, Tessie [741]*741Block and three sons, William, Richard and Herbert.

The bill further alleges that after the death of Block, appellees or some of them placed with the Probate Court of Cook County, Illinois, two purported wills of decedent, but neither has been probated. No executor or administrator has been appointed or qualified; no inventory of the assets of the estate has been filed; and appellees are in possession and control of all the assets of decedent, including all property relating to patent rights, the generating model of the hydrogen gas and its disclosures, and decedent’s records, formulas and data relating thereto. Appellees deny, so the bill alleges, that there are now or ever were any such items and properties, and deny that there ever was any such joint adventure existing between decedent and appellant relating to the synthetic sugar or the coffee processing.

Upon these allegations appellant asks the following relief in addition to general equitable relief:

1. That a trust be impressed in favor of appellant and the Block estate upon all property left by decedent which in any manner relates to, or reveals any information concerning, or is useful in producing the synthetic sugar, or the hydrogen gas, or the decaffeinized coffee, or the antiseptic solution, and that such property be decreed to be the property of decedent’s estate.

2. That defendants be required to account for all assets of the estate and to execute and deliver such instruments of conveyance or assignments to appellant which this court may find him entitled to under the allegations of the complaint.

3. That defendants be enjoined from disposing of any of the assets of the estate until final hearing.

4. That appellant be decreed to be a joint adventurer with Block in the making, development, control and commercialization of the four products, as well as in the processes, and the existing and contemplated patents.

5. That defendants as trustees be ordered to aid and assist appellant in making proper application for patents, and in protecting them, and in generating and controlling the hydrogen gas.

6.

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Bluebook (online)
124 F.2d 738, 52 U.S.P.Q. (BNA) 7, 1941 U.S. App. LEXIS 2580, Counsel Stack Legal Research, https://law.counselstack.com/opinion/price-v-block-ca7-1941.