Thurston v. Reed

229 F. 737, 1915 U.S. Dist. LEXIS 958
CourtDistrict Court, D. Massachusetts
DecidedDecember 31, 1915
DocketNo. 615
StatusPublished
Cited by1 cases

This text of 229 F. 737 (Thurston v. Reed) is published on Counsel Stack Legal Research, covering District Court, D. Massachusetts primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Thurston v. Reed, 229 F. 737, 1915 U.S. Dist. LEXIS 958 (D. Mass. 1915).

Opinion

DODGE, Circuit Judge.

The relief sought in this suit is the cancellation of an assignment by the plaintiff Thurston, executed by him February 25, 1914, of United States patent No. 706,701, which was issued to him August 12, 1902. The assignment purports to convey the patent to the defendant Reed for the sum of $200, the receipt whereof is acknowledged. The bill alleges that the assignment was procured by fraud practiced upon Thurston by the defendant Calder. It seeks also a reconveyance of the patent by the defendant United Metals Coating Company of America, to whom Reed has since assigned the patent, on August 4, 1914. A preliminary injunction, issued June 3, 1915, has forbidden its further transfer pending this suit.

As originally filed, the bill alleged nothing regarding the amount in controversy. An amendment allowed at the hearing, on July 15, 1915, sets forth that:

“Tbe subject-matter oí the controversy exceeds the sum of $3,000 value, exclusive of costs and interest.”

The defendant has not disputed the jurisdiction of the court. So far as diverse citizenship of the parties is concerned, jurisdiction appears from the allegations of the amended bill.

[739]*739In a further amendment, also allowed July 15, 1915, the plaintiffs tender the defendant corporation the $200 paid for Thurston’s assignment of the patent to Reed. No- such tender had previously been made.

When the plaintiff Thurston assigned the patent in question to Reed on February 25, 1914, as above, he was sole owner- of it so far as the Patent Office records showed. By an assignment in due form, executed by him under date of April 16, 1901, he had conveyed two others patents, issued to him before the latter date, to Thurston Metal Company, a New Jersey corporation; and by the terms of that instrument he had also assigned to the same company and its legal representatives, Cor the same consideration:

“All improvements in the [processes described in said earlier patents] winch T innv hereafter invent, or improved processes for obtaining the same or similar products which 1 may invent or discover, and all patents which I may obtain under my own name or otherwise in the United States of America.”

And by the same instrument he had also agreed:

“In ease said patents were not taken out in the name of the company * * * to make or procure the assignments thereof to said company, in due form of law.”

The patent now in controversy was issued to him after -the date of the above agreements — -on August 12, 1902, as above stated. It had been applied for before that date, on March 23, 1900. The two earlier patents, assigned as above, and also the patent in controversy, covered processes for coating one metal with another.

The Thurston Metal Company had therefore been entitled to a trans fer from Thurston of the patent in controversy ever since its issue on August 12, 1902. But he had never so assigned it, nor, so far as appears, had lie ever been asked so to assign it, doubtless because the Tlmrston Metal Company, organized in 1900 to operate under his patents, had not been successful. It had been “proclaimed” in 1911 for nonpayment of taxes by the Governor of New Jersey, had discontinued business, and has been since 1911 in the hands of its directors as trustees for creditors and stockholders for winding up purposes, according to New Jersey laws. Rev. 1896, §§ 53-55. Thurston is one of the directors; all are named as plaintiffs in the hill. As directors they were equitable owners of this patent on February 24, 1914, when Thurston undertook to assign it to the defendant Reed, and were, as between them and Thurston, entitled to an assignment of it from him for the creditors’ and stockholders’ benefit. The same is apparently also true as regards three other patents issued to Thurston since his above agreements, of April 16, 1901, with the Thurston Metal Company, with which, however, this case is not concerned. Besides the Thurston patents, owned or claimed by it, the company has no assets of any consequence.

Not only liad the Tlmrston Metal Company omitted to procure from Thurston assignments of any of his patents issued subsequently to April 16, 1901, hut it had also omitted to record his assignment of that date, wherein his agreements to assign said subsequent patents were contained; and this was never put on record at the Patent Office [740]*740until March 20, 1914, after the transfer to Reed now attacked (recorded March 5, 1914), and after the present controversy had arisen. Before that date the records referred to afforded no notice of its existence.

Thurston’s patent No. 706,701, now in controversy, does not appear to have been utilized or considered with any view to- its actual use from its issue in 1902 up to the year 1914. Investigations into a German electro-plating process having by that time led two independent groups of investors to seek control of this patent, both were trying in February, 1914, to find Thurston, its sole owner according to the records, in order to negotiate with him for its purchase.

The specification of this patent, signed by Thurston March 17, 1900, gave his residence as Long Branch, in the county of Monmouth, N. J., and his residence was so given in all the patents issued to him, except one; in No. 822,873, issued June 5, 1906, on his application filed April 1, 1905, his residence is given as Newark, N. J., but he appears to have gone in 1911, broken in health, to live with his brother in Hamburg, N. Y., a village not far from Buffalo, and to have remained there during the four years preceding February, 1914. In that month he was nearly 79 years old, somewhat impaired in health and in mental vigor, but still undertaking to manage his own affairs, with some assistance in details from .his niece, Rose M. Thurston, about 20 years of age, who resided in the same house.

A representative of one of the groups above referred to called upon Thurston at Hamburg, on February 21, 1914, asked his price for the patent No. 706,701, and was told by him that it belonged to the Thurs-ton Metal Company, as did all his patents. He was also informed by Thurston that negotiations regarding the patent must be made with Charles D. Fuller, the treasurer of the Thurston Metal Company, residing and doing business in New York City, and was given Fuller’s address. Fuller was a steel merchant, a partner in the firm of Fuller Bros. & Co., which had carried on business for many years at 139 Greenwich street, tire address given as above. He was an old friend of Thurston, had been treasurer and director of the Thurston Metal Company since its organization, and appears to have had the chief control of its financial affairs.

Four days later, on February 25, 1914, the defendant Calder arrived in Hamburg. His errand there was to- see Thurston, find out whether he was the patentee named in the above patent, and, if -he was, to buy it from him, if terms of sale could be agreed on. Calder was acting for the other of the two above groups. He knew nothing, so far as appears, of the application made to Thurston on February 21st as stated.

Calder had an interview with Thurston at his brother’s house on February 25th. It lasted an hour or more. Its result was that, being satisfied as to Thurston’s identity with the patentee named, Calder offered him $200 for an assignment of that patent to Reed, one of the persons composing the group represented by him.

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Related

In re Georgia Steel Co.
240 F. 473 (N.D. Georgia, 1917)

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Bluebook (online)
229 F. 737, 1915 U.S. Dist. LEXIS 958, Counsel Stack Legal Research, https://law.counselstack.com/opinion/thurston-v-reed-mad-1915.