Wooster v. Trowbridge

115 F. 722, 1902 U.S. App. LEXIS 4963
CourtU.S. Circuit Court for the District of Southern New York
DecidedMarch 7, 1902
StatusPublished
Cited by3 cases

This text of 115 F. 722 (Wooster v. Trowbridge) is published on Counsel Stack Legal Research, covering U.S. Circuit Court for the District of Southern New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Wooster v. Trowbridge, 115 F. 722, 1902 U.S. App. LEXIS 4963 (circtsdny 1902).

Opinion

HAZEL, District Judge.

The complainant, as assignee of George H. Wooster, deceased, brings this suit in equity, and prays for a de[723]*723cree declaring and adjudging her to be the owner and entitled to-three-quarters of the bálance of a fund amounting to $24,063.41, with .accrued interest, remaining in the custody and control of this court. The deposit of the original fund of $43,557.27 was made to await the determination of all claims thereto pursuant to an order made and entered April 19, 1897. Subsequently, by order of this court, there-was paid therefrom for counsel fees, master’s report, and disbursements incurred by complainant’s assignor, the sum of $19,493.86, leaving the aforesaid balance on deposit in this court. The fund was realized as a result of perplexing and protracted litigation in a suit commenced in this court July 10, 1878, by Theodore A. Tuttle, trustee in insolvency for the benefit of creditors of the Elm City Company, a corporation organized under the laws of the state of Connecticut. The right of the trustee to bring the suit without first obtaining leave of court having jurisdiction of insolvent estates is clear. By the general statutes of Connecticut (Revision of 1875), trustees in insolvency are expressly empowered to sue in their own names any claim belonging to an insolvent debtor’s estate. The Elm City Company, at the time of the appointment of a trustee for the benefit of its creditors, owned many patents, — among them, the Crosby & Kellogg patent, so called, No. 37,033, granted December 2, 1862; being a device for plaiting and ruffling attachments to sewing machines. The Elm City Company became its owner by assignment. This was the patent relied on in the suit commenced by Tuttle, trustee, against Horace B. Clafiin et al. for its infringement. This suit was terminated in favor of the trustee, and resulted ultimately in-the recovery of a substantial sum for profits of Clafiin arising from, the illegal use of the Crosby & Kellogg patent. There are four claimants to the fund. The complainant, as already stated, claims three-quarters; Lewis, cross claimant, three-quarters; Mrs. Tillinghast,, cross claimant, one-quarter; and Trowbridge, defendant and trustee of the Elm City Company, vice Tuttle removed, claims that he is entitled to the entire fund, for the benefit of the insolvent estate.

It is essential to a complete understanding of the controversy that the status of the claimants, the amount of money which they claim,, and the source of the title which they assert, be made as clear as possible. The claim of complainant will first be considered. She claims title from two separate sources, to wit, to one-half interest in, the fund by reason of a contract entered into June 16, 1883, by and between Tuttle, as trustee, Charles B. Stoughton, his attorney and solicitor at the time in the suit brought against Clafiin & Co. to-sustain the validity of the Crosby & Kellogg patent, and George A. Wooster, complainant’s husband, and assignor of the claim sought to-be established by this suit. This contract, for convenience, will hereafter be referred to as the “Three-Party Agreement.” At the time of its execution, and prior thereto, Wooster was the owner of the Pipo reissue patent for an improvement in sewing machines for making; band ruffling, — a device similar to that of the Crosby & Kellogg patent. The Pipo reissue was also claimed by Wooster to be infringed; by Clafiin & Co. It had been sustained at final hearing (Wooster v. Blake [C. C.] 8 Fed. 529), and in 1881 Wooster obtained an inter[724]*724locutory decree in a suit which he had brought against Claflin & Co. to restrain infringement of the Pipo reissue. The initiatory success attained by Wooster against Claflin was tenaciously and aggressively combated by able counsel. The contention was that reissuing patents for the purpose of enlarging their claims was invalid, on the authority of James v. Campbell, 104 U. S. 356, 26 L. Ed. 786, and Miller v. Brass Co., 104 U. S. 350, 26 L. Ed. 783, and that the Pipo reissue came within the scope of these authorities. Justice Blatchford, who heard the case, dismissed the bill, and declared the reissue of the Pipo patent invalid as to essential claims. Wooster v. Handy (C. C.) 21 Fed. 51. This was in July, 1884. The three-party agreement was entered into one year prior thereto, and provided that Wooster and Tuttle would, at their own expense, push both suits against Claflin & Co. to a final determination; Wooster to receive the gross proceeds, and make equal division thereof between Tuttle and himself. It was further provided that Wooster should be empowered, at his election, and at his own expense, to proceed with both the Pipo and Tuttle suits, and that he alone should have power and authority to make settlements. The basis for complainant’s claim to an.additional one-quarter interest in the fund arises out of an agreement made September 7, 1877, by Tuttle, as trustee for creditors, and Alexander E. Kursheedt (hereinafter referred to as the “Kursheedt Agreement”). Kursheedt was interested in the Arnold patent for a similar device to that of the Crosby & Kellogg patent, and, by the terms of the agreement, Tuttle and Kursheedt united their interests in both patents, and agreed to grant joint licenses. It was agreed that the licenses were to be issued by Tuttle, at the request of C. B. Stoughton, and by him delivered to Kursheedt. Negotiations for licenses were to be conducted solely by Kursheedt, the terms of the grants to be approved by Stoughton. The license fees under the Crosby & Kellogg patent, and sums payable for damages for infringement thereof, were, by the terms of the agreement, made payable to Kursheedt, and from the sums so received by him he was authorized and empowered to retain 25 per cent.; the balance to be paid to Stoughton, who was authorized to retain $2,500 to meet any expenses of litigation or other disbursements necessarily incurred to enforce the Crosby & Kellogg patent. On February 20, 1890, Kursheedt assigned his interest arising from the foregoing agreement to Wooster. Subsequently, on February 27, 1888, a further agreement was made in writing by and between Tuttle, as trustee, and Wooster, by which the three-party agreement was modified, and the intent of the parties explained. Stoughton is not a party to this agreement. It provides that Wooster shall have exclusive right and power to settle, adjust, and continue or discontinue the suits specified in the three-party agreement upon such terms as Wooster may deem proper and just. Tuttle agrees that Stoughton, his attorney, shall execute such papers as may be necessary to effect the settlement. Wooster is given the authority to execute all necessary conveyances and instruments to bring about that end, and to employ counsel to represent Tuttle in the suit brought by him against Claflin. Simultaneously with the execution of the foregoing agreement, Wooster, in writing, indemnified and holds [725]*725Tuttle harmless from all costs and expenses arising out of the prosecution of either the Pipo suit or Tuttle suit. The agreement further provides that Wooster shall be reimbursed for expenditures made in the prosecution of said suits, or either of them, and that his expenditures be deducted from the proceeds before division thereof, in accordance with the three-party agreement. The effect of these latter instruments was to grant to Wooster absolute control of the then pending litigation between Tuttle and Claflin.

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115 F. 722, 1902 U.S. App. LEXIS 4963, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wooster-v-trowbridge-circtsdny-1902.