Aro Manufacturing Co. v. Convertible Top Replacement Co.
Aro Manufacturing Co. v. Convertible Top Replacement Co.
Opinion of the Court
delivered the opinion of the Court.
Respondent Convertible Top Replacement Co., Inc., (CTR) acquired by assignment from the Automobile Body Research Corporation (AB) all rights for the territory of Massachusetts in United States Patent No. 2,569,724, known as the Maekie-Duluk patent. This is a combination patent covering a top-structure for automobile “convertibles.” Structures embodying the patented combination were included as original equipment in 1952-1954 models of convertibles manufactured by the General Motors Corporation and the Ford Motor Company. They were included in the General Motors cars by authority of a license granted to General Motors by AB; Ford, however, had no license during the 1952-1954
CTR brought this action against Aro in 1956 to enjoin the alleged infringement and contributory infringement, and to obtain an accounting, with respect to replacement fabrics made and sold by Aro for use in both the General Motors and the Ford cars embodying the patented structures. The interlocutory judgment entered for CTR by the District Court for the District of Massachusetts, 119 U. S. P. Q. 122, and affirmed by the Court of Appeals for the First Circuit, 270 F. 2d 200, was reversed here. Aro Mfg. Co. v. Convertible Top Replacement Co., 365 U. S. 336 (“Aro I”), petition for rehearing or alternative motion for amendment or clarification denied, 365 U. S. 890. Our decision dealt, however, only with the General Motors and not with the Ford cars. Like the Court of Appeals, we treated CTR’s right to relief as depending wholly upon the question whether replacement of the fabric portions of the convertible tops constituted infringing “reconstruction” or permissible “repair” of the patented combination. The lower courts had held it to constitute “reconstruction,” making the car owner for whom it was performed a direct infringer and Aro, which made
On remand, however, another judge in the District Court read our opinion as requiring the dismissal of CTR’s complaint as to the Ford as well as the General Motors cars, and entered judgment accordingly. CTR appealed the dismissal insofar as it applied to the Ford cars, and the Court of Appeals reinstated the judgment in favor of CTR to that extent. 312 F. 2d 52. In our view the Court of Appeals was correct in holding that its “previous decision in this case was not reversed insofar as unlicensed Ford cars are concerned.” 312 F. 2d, at 57.
CTR contends, and the Court of Appeals held, that since Ford infringed the patent by making and selling the top-structures without authority from the patentee,
“It is admitted that petitioners [Aro] know that the purchasers intend to use the fabric for replacement purposes on automobile convertible tops which are covered by the claims of respondent’s combination*615 patent, and such manufacture and sale with that knowledge might well constitute contributory infringement under § 271 (c), if, but only if, such a replacement by the purchaser himself would in itself constitute a direct infringement under § 271 (a), for it is settled that if there is no direct infringement of a patent there can be no contributory infringement. ... It is plain that § 271 (c) — a part of the Patent Code enacted in 1952 — made no change in the fundamental precept that there can be no contributory infringement in the absence of a direct infringement. That section defines contributory infringement in terms of direct infringement — namely the sale of a component of a patented combination or machine for use 'in an infringement of such patent.’ And § 271 (a) of the new Patent Code, which defines 'infringement/ left intact the entire body of case law on direct infringement. The determinative question, therefore, comes down to whether the car owner would infringe the combination patent by replacing the worn-out fabric element of the patented convertible top on his car . . . .”
Similarly here, to determine whether Aro committed contributory infringement, we must first determine whether the car owners, by replacing the worn-out fabric element of the patented top-structures, committed direct infringement. We think it clear, under § 271 (a) of the Patent Code and the ''entire body of case law on direct infringement” which that section ''left intact,” that they did.
Section 271 (a) provides that “whoever without authority makes, uses or sells any patented invention . . . infringes the patent.” It is not controverted— nor could it be — that Ford infringed by making and selling cars embodying the patented top-structures without any authority from the patentee. If Ford had had such authority, its purchasers would not have infringed
If the owner’s use infringed, so also did his repair of the top-structure, as by replacing the worn-out fabric component. Where use infringes, repair does also, for it perpetuates the infringing use.
“No doubt ... a patented article may be repaired without making the repairer an infringer, . . . but not where it is done for one who is. It is only where the device in patented form has come lawfully into the hands of the person for or by whom it is repaired that this is the case. In other words, if one without right constructs or disposes of an infringing machine, it affords no protection to another to have merely repaired it; the repairer, by supplying an essential part of the patented combination, contributing by*617 so much to the perpetuation of the infringement.” Union Special Mach. Co. v. Maimin, 161 F. 748, 750 (C. C. E. D. Pa. 1908), aff’d, 165 F. 440 (C. A. 3d Cir. 1908).
Accord, Remington Rand Business Serv., Inc., v. Acme Card System Co., 71 F. 2d 628, 630 (C. A. 4th Cir. 1934), cert. denied, 293 U. S. 622; 2 Walker, Patents (Deller ed. 1937), at 1487. Consequently replacement of worn-out fabric components with fabrics sold by Aro, held in Aro I to constitute “repair” rather than “reconstruction” and thus to be permissible in the case of licensed General Motors cars, was not permissible here in the case of unlicensed Ford cars. Here, as was not the case in Aro I, the direct infringement by the car owners that is prerequisite to contributory infringement by Aro was unquestionably established.
We turn next to the question whether Aro, as supplier of replacement fabrics for use in the infringing repair by the Ford car owners, was a contributory infringer under § 271 (c) of the Patent Code. That section provides:
“Whoever sells a component of a patented machine, manufacture, combination or composition, or a material or apparatus for use in practicing a patented process, constituting a material part of the invention, knowing the same to be especially made or especially adapted for use in an infringement of such patent, and not a staple article or commodity of commerce suitable for substantial noninfringing use, shall be liable as a contributory infringer.”
We think Aro was indeed liable under this provision.
Such a result would plainly have obtained under the contributory-infringement case law that § 271 (e) was intended to codify.
“There was, consequently, no implied license to use the spare parts in these machines. As such use, unless licensed, clearly constituted an infringement, the sale of the spare parts to be so used violated the injunction [enjoining infringement].”
As early as 1897, Circuit Judge Taft, as he then was, thought it “well settled” that
“where one makes and sells one element of a combination covered by a patent with the intention and*619 for the purpose of bringing about its use in such a combination he is guilty of contributory infringement and is equally liable to the patentee with him who in fact organizes the complete combination.” Thomson-Houston Elec. Co. v. Ohio Brass Co., 80 F. 712, 721 (C. A. 6th Cir. 1897).
While conceding that in the case of a machine purchased from the patentee, one “may knowingly assist in assembling, repairing, and renewing a patented combination by furnishing some of the needed parts,” Judge Taft added: “but, when he does so, he must ascertain, if he would escape liability for infringement, that the one buying and using them for this purpose has a license, express or implied, to do so.” Id., at 723. See also National Brake & Elec. Co. v. Christensen, 38 F. 2d 721, 723 (C. A. 7th Cir. 1930), cert. denied, 282 U. S. 864; Reed Boiler Bit Co. v. Hughes Tool Co., 12 F. 2d 207, 211 (C. A. 5th Cir. 1926); Shickle, Harrison & Howard Iron Co. v. St. Louis Car-Coupler Co., 77 F. 739, 743 (C. A. 8th Cir. 1896), cert. denied, 166 U. S. 720. These cases are all authority for the proposition that “The right of one, other than the patentee, furnishing repair parts of a patented combination, can be no greater than that of the user, and he is bound to see that no other use of such parts is made than that authorized by the user’s license.” National Malleable Casting Co. v. American Steel Foundries, 182 F. 626, 641 (C. C. D. N. J. 1910).
In enacting § 271 (c), Congress clearly succeeded in its objective of codifying this case law. The language of the section fits perfectly Aro’s activity of selling “a component of a patented . . . combination . . . , constituting a material part of the invention, . . . especially made or especially adapted for use in an infringement of such patent, and not a staple article or commodity of commerce suitable for substantial noninfringing use.” Indeed, this is the almost unique case in which the component was
However, the language of § 271 (c) presents a question, apparently not noticed by the parties or the courts below, concerning the element of knowledge that must be brought home to Aro before liability can be imposed. It is only sale of a component of a patented combination “knowing the same to be especially made or especially adapted for use in an infringement of such patent” that is contributory infringement under the statute. Was Aro “knowing” within the statutory meaning because — as it admits, and as the lower courts found — it knew that its replacement fabrics were especially designed for use in the 1952-1954 Ford convertible tops and were not suitable for other use? Or does the statute require a further showing that Aro knew that the tops were patented, and knew also that Ford was not licensed under the patent so that any fabric replacement by a Ford car owner constituted infringement?
On this question a majority of the Court is of the view that § 271 (c) does require a showing that the alleged contributory infringer knew that the combination for which his component was especially designed was both patented and infringing.
In seeking to avoid such liability, Aro relies on the Mercoid cases. Mercoid Corp. v. Mid-Continent Investment Co., 320 U. S. 661; Mercoid Corp. v. Minneapolis-Honeywell Regulator Co., 320 U. S. 680. Since those cases involved essentially an application of the doctrine of patent misuse, which is not an issue in this case,
Thus we hold that, subject to the reservation expressed at pp. 488-491, supra, with respect to sales made before January 2, 1954, and subject to the further reser
II.
Although we thus agree with the Court of Appeals that Aro was liable for contributory infringement with respect to the Ford cars, we find merit in a defense asserted by Aro. In our view this defense negatives Aro’s liability as to some of the replacement fabrics in question and, as to the others, reduces substantially — quite possibly to a mere nominal sum — the amount of recovery that CTR may be awarded. The defense is based on the agreement of July 21, 1955, between Ford and AB. See note 4, supra. This agreement affected Aro’s liability differently, we think, depending upon whether the replacement-fabric sales were made before or after the agreement date. We shall first discuss its effect on liability for the subsequent sales.
The agreement was made at a time when, as CTR states in its brief, “Ford had already completed its manufacture of all the cars here involved.” Under it, Ford agreed to pay AB $73,000 for certain rights under the patent, which were defined by paragraph 1 of the agreement as follows:
“1. AB hereby releases Ford, its associated companies . . . [and] its and their dealers, customers and users of its and their products, of all claims that AB has or may have against it or them for infringement of said patents arising out of the manufacture, use or sale of devices disclosed therein and manufactured before December 31, 1955, other than the ‘replacement top fabrics’ licensed under paragraph 3.”
“to license under . . . said Mackie-Duluk patent . . . the manufacture, use and sale of replacement top fabrics other than those supplied to, made by or sold by Ford ... to the extent that AB is entitled to reserve such right under 35 United States Code, §271 (1952).”
In a pretrial memorandum filed early in the lawsuit, the District Court construed the agreement in the following manner, which we think to be a correct interpretation of the parties’ intention:
(1) With respect to all patented top-structures manufactured before July 21, 1955, and all replacement fabrics installed before that date, it was a “release” to the parties named — that is, Ford and its customers — of the claims for infringement by manufacture, sale, or use of the patented combination;
(2) With respect to any new structures manufactured between July 21 and December 31, 1955 (it-appears that there were no such structures), the agreement was a “future license” to Ford and its customers to make, sell, and use the patented combination, but “excepting replacements” unless these were provided by Ford under the special license granted by paragraph 3;
(3) With respect to the post-July 21 status of structures manufactured before July 21, the agreement was also a “future license” to Ford and its customers of the rights to make, sell, and use, but again, “excepting replacements” not provided by Ford; and
(4) The agreement “demonstrated an intention not to release” or license any persons other than Ford or its customers; in particular, the parties did not intend
Considering the legal effect of the agreement as so construed, the District Court went on to rule that if the fabric replacement should be held to constitute repair rather than reconstruction (as this Court did subsequently hold in Aro I), then:
(a) Aro would be liable for contributory infringement as to replacements made before July 21, 1955, since “I do not construe the agreement to release contributory infringers for rights of action already accrued”;
(b) however, despite the intention of the parties, Aro would not be liable as to replacements made after July 21, 1955, since “If replacement is legitimate repair, no average owner can do-it-yourself, and he must be free to go to persons in the position of defendants without apprehension on their part.”
The distinction between pre-agreement and post-agreement sales subsequently became irrelevant to the District Court’s view of the case, when it held after trial that replacement of the fabrics constituted reconstruction rather than repair; the Court’s interlocutory judgment for CTR thus held Aro liable with respect to all the Ford cars in question. When this Court in Aro I reversed the ruling on the reconstruction-repair issue, the only reference in the opinions to the Ford cars took the view that Aro should be held liable only in respect of replacements made on those cars “before July 21, 1955,” 365 U. S., at 368 (concurring opinion), and thus agreed with the distinction originally drawn by the District Court. The present opinion of the Court of Appeals, however, in reinstating the Ford car portion of the interlocutory judgment for CTR without consideration of this distinction, appears to have held Aro liable in respect of replacement fabrics sold for the 1952-1954 Ford cars not only before
CTR’s argument in support of this result emphasizes that the agreement in terms ran in favor only of Ford and Ford’s customers and not of third parties like Aro, and that it expressly excepted “replacement top fabrics” from the scope of the rights it granted. Reliance is also placed on testimony that the amount to be paid by Ford under the agreement was set as low as $73,000 only because of a clear understanding between the parties that such payment would not affect AB’s rights to recover from persons in the position of Aro.
“If the Ford agreement had never been made at all, it is clear that it would have been proper to require that Aro pay royalties, insofar as infringing Ford cars are concerned, even up to the present time. This being the case, it is clear that it was proper for the agreement to expressly recognize and to expressly exclude Aro’s liability from its terms. Since Ford refused to purchase any rights for Aro, either before or after July 21, 1955, Aro is liable for its Ford repair activities both before and after that date.”
Insofar as replacement fabrics sold “after that date” are concerned, we do not agree. We think the agreement’s attempt to reserve rights in connection with future sales of replacement fabrics was invalid. By the agree-
With the restriction thus eliminated from consideration, it is clear that Aro cannot be liable for contributory infringement in connection with sales of replacement fabrics made after July 21, 1955. After that date the Ford car owners had authority from the patentee — indeed, had
CTR would have it that this result is inconsistent with Birdsell v. Shaliol, 112 U. S. 485, and Union Tool Co. v. Wilson, 259 U. S. 107. In our view it is .not. Birdsell allowed the patentee to hold one infringer liable for use of the patented machines after obtaining a judgment against another infringer for the manufacture and sale of the same machines; Union Tool held infringement to exist where the defendant, after being held liable for the manufacture and sale of certain infringing machines, sold spare parts for use in the same machines. Both cases turned upon the fact that the patentee had not collected on the prior judgment and thus had not received any compensation for the infringing use — or, indeed, any compensation at all.
III.
Turning to the question of replacement-fabric sales made before July 21, 1955, we agree with the District Court that the agreement between AB and Ford did not negative Aro’s liability for these sales. With respect to the post-agreement sales the agreement necessarily absolved Aro of liability, its intention to the contrary notwithstanding, because it had the effect of precluding any direct infringement to which Aro could contribute. With respect to the pre-agreement sales, however, Aro’s contributory infringement had already taken place at the time of the agreement. Whatever the agreement’s effect on the amount recoverable from Aro — a matter to be discussed in Part IV of this opinion — it cannot be held, in the teeth of its contrary language and intention, to have erased the extant infringement.
It is true that a contributory infringer is a species of joint-tortfeasor, who is held liable because he has contributed with another to the causing of a single harm to the plaintiff. See Wallace v. Holmes, 29 Fed. Cas. 74, 80 (No. 17,100) (C. C. D. Conn. 1871); Thomson-Houston Elec. Co. v. Ohio Brass Co., supra, 80 F., at 721; Rich,
IV.
The case must now be remanded for a determination of the damages to be recovered from Aro in respect of the infringing pre-agreement sales. It is true that the lower courts have not yet expressly addressed themselves to the damages issue, and that the parties have not argued it here. Nevertheless, it appears that all concerned in this litigation have shared a specific assumption as to the measure of damages that would be available to CTR if it succeeded in establishing infringement. Because we sharply disagree with that assumption, and because expression of our views may obviate the need upon remand for lengthy proceedings before a master in this already over-long litigation, we deem it in the interest of efficient judicial administration to express those views at this time. In brief, it is our opinion that the Ford agreement, while it does not negate Aro’s liability for the prior sales as it does for the subsequent ones, does have the effect of limiting the amount that CTR can recover for the pre-agreement infringement, and probably of precluding recovery of anything more than nominal damages.
If the sum paid by Ford for the release of it and its customers constituted full satisfaction to AB for the infringing use of the patented structures, we think it clear that CTR cannot now collect further payment from Aro
“Payments made by one tortfeasor on account of a harm for which he and another are each liable, diminish the amount of the claim against the other whether or not it was so agreed at the time of payment and whether the payment was made before or after judgment . . . Restatement of Torts, supra, §885 (3).
It has been said that “all courts are agreed” upon such a rule. Prosser, supra, at 246. And its applicability to contributory-infringement cases has been clearly indicated by this Court. Birdsell v. Shaliol, supra, 112 U. S., at 488-489; see Hazeltine Corp. v. Atwater Kent Mfg. Co., 34 F. 2d 50, 52 (D. C. E. D. Pa. 1929). Indeed, if “actual damages” or “full compensation” paid by a maker-and-seller can have the effect of releasing a user, as was indicated in Birdsell, such a result should follow a fortiori where, as here, the damages paid were expressly stated to be compensation for use of the device, and the person subsequently sued is a contributory infringer liable merely for contributing to the same infringing use. In such a case full payment by or on behalf of the direct infringer leaves nothing to be collected from the contributory infringer. We therefore find it necessary to consider whether the payment by Ford to AB constituted full payment for the infringing use committed directly by Ford’s purchasers and contributorily by Aro.
This depends upon the measure and total amount of recovery to which CTR and AB are entitled. In particular, if they are entitled to recover a royalty from Aro on the infringing sales of replacement fabrics, it is clear that no such recovery was included in the payment from Ford, whose representatives “weren’t interested in buying any sort of a release or license or anything else that
The measure of recovery for patent infringement is governed by 35 U. S. C. § 284, which provides:
“Upon finding for the claimant the court shall award the claimant damages adequate to compensate for the infringement, but in no event less than a reasonable royalty for the use made of the invention by the infringer, together with interest and costs as fixed by the court.
“When the damages are not found by a jury, the court shall assess them. In either event the court may increase the damages up to three times the amount found or assessed.”
It is presumably the language “in no event less than a reasonable royalty” that has led to the assumption noted
“In patent nomenclature what the infringer makes is 'profits’; what the owner of the patent loses by such infringement is 'damages.’ ” Duplate Corp. v. Triplex Safety Glass Co., 298 U. S. 448, 451. Profits and damages have traditionally been all-inclusive as the two basic elements of recovery. Prior to 1946, the statutory precursor of the present § 284 allowed recovery of both amounts, reading as follows:
“[U]pcm a decree being rendered in any such case for an infringement the complainant shall be entitled to recover, in addition to the profits to be accounted for by the defendant, the damages the complainant has sustained thereby . . . .” R. S. § 4921, as amended, 42 Stat. 392.
By the 1946 amendment, Act of August 1,1946, c. 726, § 1, 60 Stat. 778, 35 U. S. C. (1946 ed.), §§ 67, 70, the statute was changed to approximately its present form, whereby only “damages” are recoverable.
“The object of the bill is to make the basis of recovery in patent-infringement suits general damages, that is, any damages the complainant can*638 prove, not less than a reasonable royalty, together with interest from the time infringement occurred, rather than profits and damages.” H. R. Rep. No. 1587, 79th Cong., 2d Sess. (1946), to accompany H. R. 5311, at 1-2; S. Rep. No. 1503, 79th Cong., 2d Sess. (1946), to accompany H. R. 5311, at 2.21
There can be no doubt that the amendment succeeded in effectuating this purpose; it is clear that under the present statute only damages are recoverable. See, e. g., Ric-Wil Co. v. E. B. Kaiser Co., 179 F. 2d 401, 407 (C. A. 7th Cir. 1950), cert. denied, 339 U. S. 958; Livesay Window Co. v. Livesay Industries, Inc., 251 F. 2d 469, 471-472 (C. A. 5th Cir. 1958); Laskowitz v. Marie Designer, Inc., 119 F. Supp. 541, 554-555 (D. C. S. D. Cal. 1954); Cullen, 28 J. Pat. Off. Soc. 838 (1946); Wolff, 28 J. Pat. Off. Soc. 877 (1946).
The 1946 amendment is of crucial significance to the total amount of CTR’s recovery against Aro and hence to the amount, if any, that may still be recovered after receipt of the payment from Ford. When recovery of the infringer’s profits as such was allowed, the rule was that “complainant’s damages are no criterion of defendant’s profits”; it was “immaterial that the profits made by the defendant would not have been made by the plaintiff.” 3 Walker, Patents (Deller ed. 1937), § 845, at 2186. And in cases of joint infringement this Court was said to have declared the doctrine that, whereas “when the total damage sustained has been paid by one tort-feasor, the damages cannot be duplicated through a recovery against another,” nevertheless, “every infringer of a patent right may be made to give up whatever profits he has derived from the infringement, and . . . one in-
But the present statutory rule is that only “damages” may be recovered. These have been defined by this Court as “compensation for the pecuniary loss he [the patentee] has suffered from the infringement, without regard to the question whether the defendant has gained or lost by his unlawful acts.” Coupe v. Royer, 155 U. S. 565, 582. They have been said to constitute “the difference between his pecuniary condition after the infringement, and what his condition would have been if the infringement had not occurred.” Yale Lock Mfg. Co. v. Sargent, 117 U. S. 536, 552. The question to be asked in determining damages is “how much had the Patent Holder and Licensee suffered by the infringement. And that question [is] primarily: had the Infringer not infringed, what would Patent Holder-Licensee have made?” Livesay Window Co. v. Livesay Industries, Inc., supra, 251 F. 2d, at 471.
Thus, to determine the damages that may be recovered from Aro here, we must ask how much CTR suffered by Aro’s infringement — how much it would have made if Aro had not infringed. Asking that question, we may assume first that the agreement of July 21, 1955, did not exist and that AB had not collected a cent from Ford. Even on that assumption, we would find it difficult to see why CTR’s damages should be measured by a royalty on Aro’s sales. CTR and AB were not deprived of such a royalty by Aro’s infringement, for they could not have licensed Aro’s sales in any event; they
If CTR thus could not collect a royalty on Aro’s sales in the absence of any payment from Ford, it surely can
To allow recovery of a royalty on Aro’s sales after receipt of the equivalent of a royalty on Ford’s sales, or to allow any recovery from Aro after receipt of full satisfaction from Ford, would not only disregard the statutory provision for recovery of “damages” only, but would be at war with virtually every policy consideration in this area of the law. It would enable the patentee to derive a profit not merely on unpatented rather than patented goods — an achievement proscribed by the Motion Picture Patents and Mercoid cases, supra — but on unpatented and patented goods. In thus doubling the number of rewards to which a patentee is entitled “under our patent law as written,” see Mr. Justice Black concurring in Aro I, 365 U. S., at 360, it would seriously restrict the purchaser’s long-established right to use and repair an article which he has legally purchased and for the- use of which the patentee has been compensated. See Adams v. Burke, 17 Wall. 453. The patentee could achieve this result, moreover, by the simple tactic of not licensing or suing the manufacturer in the first place, but rather standing by while the direct infringement occurs, thus allowing contributory infringements to spring up around him, with the result of bringing within the reach of his monopoly unpatented items that would never have been there if the manufacturer had been licensed from the start. And little is sacrificed, for it is almost always possible to sue or settle with the manufacturer at a later date. This
To achieve such a result through use of the contributory infringement doctrine would be especially ironic, in view of the purpose of that doctrine as set forth in case law and commentary and as presented to the Congress in urging passage of § 271 (c). That purpose is essentially, as was stated in the earlier versions of the bill that became § 271 (c), “to provide for the protection of patent rights where enforcement against direct infringers is impracticable,” H. R. 5988, 80th Cong., 2d Sess.; H. R. 3866, 81st Cong., 1st Sess. At the hearings on § 271 (c) itself, Mr. Rich, see. n. 6, supra-, explained to the subcommittee that “There may be twenty or thirty percent of all the patents that are granted that cannot practically be enforced against direct infringers .. ..” Hearings, supra, n. 6, at 160.
Hence we think that after a patentee has collected from or on behalf of a direct infringer damages sufficient to put him in the position he would have occupied had there been no infringement, he cannot thereafter collect actual damages from a person liable only for contributing to the same infringement. This principle is but an application of the rule that full satisfaction received from one tort-feasor prevents further recovery against another. It is consistent with the Court’s opinion in Birdsell v. Shaliol, supra, 112 U. S., at 488-489. See also George Haiss Mfg. Co. v. Link-Belt Co., 63 F. 2d 479, 481 (C. A. 3d Cir. 1932); Buerk v. Imhaeuser, note 14, supra, 4 Fed. Cas. 597. And it is squarely in accord with a recent decision of the Court of Appeals for the Second Circuit. Farrand Optical Co., Inc., v. United States, 325 F. 2d 328, 335 (C. A. 2d Cir. 1963). Nor is there any authority, even in lower courts, directly to the contrary. Of the many cases cited by CTR for the correct proposition that use or repair of an infringing structure constitutes infringement, relatively few deal at all with the question of amount of recovery. Some of these, it is true, do allow recovery on sales of infringing machines and a further
In the Farrand cáse, supra, the payment by the direct infringer was made under judicial decree, and there could thus be no question but that it represented full compensation for the infringing use. Where a private release of past infringement which does not purport to release others is involved, the adequacy of the compensation must always be a question of fact. Hence here, while it seems unlikely that Ford’s payment under the agreement was any less than would have been paid under a license— that is, anything less than full satisfaction to AB for the infringing use committed directly by Ford’s purchasers and contributorily by Aro — we think the case must nevertheless be remanded for findings on the question. We would also allow the lower courts to consider whether Aro’s conduct has been such as to warrant an award of punitive or increased damages, although we think that very unlikely.
V.
The result is that the judgment of the Court of Appeals is reversed insofar as it holds Aro liable for contributory infringement with respect to replacement-fabric sales
It is so ordered.
The repair-versus-reeonstruction issue had been the only issue expressly considered or decided by the Court of Appeals orr review of the District Court’s original interlocutory judgment, see 270 F. 2d, at 202, and was thus the focal point of the briefs and arguments here in Aro I. See, e. g., Brief for the United States as Amicus Curiae, at 2-3 and n. 1; but see Brief for the Respondent, at 73-76. That the Court considered no other issue, and thus dealt only with the General Motors and not with the Ford cars, is evident from its statement of the "determinative question” as being that of repair versus reconstruction, 365 U. S., at 342; from its failure to
We also granted Aro’s motion for leave to use the record that was before us in Aro I. 372 U. S. 958.
CTR has made a Motion to Settle the Record, asking us to declare that certain items designated for printing by Aro do not comprise a portion of the record before this Court. We postponed further
This Part of the opinion — with the exception of the point discussed at p. 488 and note 8, infra — expresses the views of Justices BaklaN, BreNNAN, Stewart, White, and Goldberg.
The case will be considered in this Part of the opinion without reference to the agreement made on July 21, 1955, between Ford and AB, and thus on the assumption that Ford never obtained any authority under the -patent. The effect of that, agreement will be considered in succeeding Parts of the opinion.
We have no need to consider whether the car owners, if sued for infringement by the patentee, would be entitled to indemnity from Ford on a breach of warranty theory. In fact they were not sued, and were released from liability by 'the agreement between Ford and AB. See infra, at 493-495.
The section was designed to “codify in statutory form principles of contributory infringement” which had been “part of our law for
“Then in effect this recodification, particularly as to section 231 [which became § 271 in the Patent Code of 1952], would point out to the court, at least that it was the sense of Congress that we remove this question of confusion as to whether contributory infringement existed at all, and state in positive law that there is such a thing as contributory infringement, or at least it be the sense of Congress by the enactment of this law that if you have in the Mercoid case [320 U. S. 661, 680] done away with contributory infringement, then we reinstate it as a matter of substantive law of the United States and that you shall hereafter in a proper case recognize or hold liable one who has contributed to the infringement of a patent.
“That is the substantive law that we would write if we adopted this section 231 as it now exists. Is that not about right?”
Mr. Giles S. Rich, now judge of the Court of Customs and Patent Appeals, then spokesman for proponents of § 271 (c), answered that the statement of the bill’s purpose was “very excellent.” Ibid. See also 98 Cong. Rec. 9323, 82d Cong., 2d Sess., July 4,1952 (colloquy of Senators Saltonstall and McCarran).
Aro’s factory manager admitted that the fabric replacements in question not only were specially designed for the Ford convertibles but would not, to his knowledge, fit the top-structures of any other cars.
This view is held by The Chief Justice and Justices Black, Douglas, Clark and White. See the opinion of Mr.- Justice Black, post, pp. 524^528, and of Mr. Justice White, post, p. 514.
Justices Harlan, Brennan, Stewart and Goldberg dissent from this interpretation of the statute. They are of the view that the
'(1) No other result would have been consistent with the congressional intention to codify the case law of contributory infringement as it existed prior to this Court’s decision in Mercoid Corp. v. Mid-Continent Investment Co., 320 U. S. 661 — and to do this not only in general, see note 6, swpra, and p. 492, infra, but with specific reference to the knowledge requirement. See Hearings, supra, note 6, at 159-160, 163-165. Under that case law, liability was established by a showing that the component was suitable for no substantial use other than in the patented combination, since it was “the duty of the defendant to see to it that such combinations which it is intentionally inducing and promoting shall be confined to those which may be lawfully organized.” Thomson-Houston Elec. Co. v. Ohio Brass Co., supra, 80 F., at 720-723. Accord, Mercoid Corp. v. Mid-Continent Investment Co., supra, 320 U. S., at 664; 3 Walker, Patents (Deller ed. 1937), at 1764-1765, and cases cited. See Freedman v. Friedman, 242 F. 2d 364 (C. A. 4th Cir. 1957).
(2) The House Committee’s change in the language of the bill concerning the knowledge requirement, see the opinion of MR. Justice Black, post, pp. 524r-528, was not intended to limit liability to cases where the alleged contributory infringer had knowledge of the patented or infringing nature of the combination; it was intended merely to assure that the statute would be construed to require knowledge that the article sold was a component of some combination and was especially designed for use therein, rather than simply knowledge that the article was being sold. See, e. g., the statement of Congressman Crumpacker, Hearings, supra, at 175, objecting to the original language on the ground that “the way it is phrased the word 'knowingly’ refers directly to the word ‘sells.’ ” See also id., at 175-176. While the representatives of a manufacturing concefn and of the Justice Department did urge the Committee to adopt the position which the Court now holds it did adopt, none of the Congressmen
“[Y]ou know that the component is going into that machine. You don’t have to know that it is patented. You don’t have to know the number of the patent, and you don’t have to know that the machine that it is going into constitutes an infringement.” Id., at 175; see also id., at 160, 176.
(3) The suggestion that a person cannot be liable even for direct infringement when he has no knowledge of the patent or the infringement is clearly refuted by the words of § 271 (a), which provides that “whoever without authority makes, uses or sells any patented invention . . . infringes the patent,” with no mention of any knowledge requirement. And the case law codified by § 271 has long recognized the fundamental proposition that “To constitute an infringement of a patent, it is not necessary that the infringer should have known of the existence of the patent at the time he infringed it or, knowing of its existence, it is not necessary that he should have known his doings to constitute an infringement.” 3 Walker, Patents (Deller ed. 1937), § 453. See, e. g., United States v. Berdan Fire-Arms Mfg. Co., 156 U. S. 552, 566; Sontag Chain Stores Co. v. National Nut Co., 310 U. S. 281, 295; Boyden v. Burke, 14 How. 575, 582.
(4) Section 287 of 35 U. S. C., quoted in the opinion of Mr. Justice Black, post, p. 528, n. 14, does not require a different conclusion. That section prevents a patentee from recovering damages for infringement unless he has marked the patented article with notice of the patent. Since a patentee may hardly be expected to mark the article when it has not been manufactured or sold by him, but rather by an infringer, the section has been held not to apply to such a situation. Wine Ry. Appliance Co. v. Enterprise Ry. Equip. Co., 297 U. S. 387. That of course is the situation here with respect to the Ford cars.
Aro does contend here that recovery by CTR is precluded by misuse of the patent, and also that such misuse entitles Aro to an award of treble damages for violation of the antitrust laws. Although the point was arguably raised by Aro’s original answer and counterclaim, and was decided against Aro in the original opinion of the District Court, 119 U. S. P. Q., at 122, n. 1, it was substantially abandoned on the first appeal, and hence was not ruled on in the first opinion of the Court of Appeals. Accordingly, this Court’s opinion in Aro I stated that patent misuse “is not an issue in this case.” 365 U. S., at 344, n. 10; see also the dissenting opinion of Mr.. Justice Harlan, 365 U. S., at 376-377 and n. 5. On remand, after the District Court had dismissed without prejudice the counterclaim alleging misuse, the Court of Appeals held that neither the defense based on misuse nor the counterclaim was in the case, the defense having been “clearly abandoned” and the counterclaim never having been adequately pleaded. 312 F. 2d, at 58. We do not find error in this ruling, and thus have no occasion to consider Aro’s allegations of patent misuse.
We have no doubt that § 271 (c) as so construed and applied, within the limitations set forth in the succeeding portions of this opinion, is constitutional.
This Part of the opinion expresses the views of Justices Brennan, Stewart, White, and Goldberg. Mr. Justice Harlan concurs in the result.
Counsel for AB testified on deposition as follows:
“I . . . definitely told them that there were these other replacement top manufacturers and that if we were left in a position to collect royalty from them, that obviously we could give Ford a lower rate, and that is what Ford said they wanted, that they weren’t interested in buying any sort of a release or license or anything else that would help out these replacement top people
The District Court termed the agreement a “future license” in this respect, and AB’s counsel on more than one occasion referred to it as a “release or license.” It is difficult to see why it should not be considered a license insofar as it related to future activity, see De Forest Radio Tel. Co. v. United States, 273 U. S. 236, 241, although of course its proper label is less important than its clear effect of authorizing Ford’s purchasers to make full use of the patented structures.
In Birdsell the Court relied on the fact that only nominal damages had been awarded in the prior suit. 112 U. S., at 489. In Union Tool the Court’s statement that the patentee had not “received any compensation whatever for the infringement by use of these machines,” 259 U. S., at 113, was apparently based on the fact that the damages and profits awarded by the prior judgment had not yet been calculated or paid. See Brief for Respondent, at 37, and the opinion of the Court of Appeals, 265 F. 669, 673 (C. A. 9th Cir. 1920). Compare Buerk v. Imhaeuser, 4 Fed. Cas. 597 (No. 2,108) (C. C. S. D. N. Y. 1876), 4 Fed. Cas. 594 (No. 2,107) (C. C. S. D. N. Y. 1876).
The date of the sale by Aro rather than the date of the installation in the car by the purchaser from Aro should control, since it is the act of sale that is made contributory infringement by § 271 (c).
Since Aro’s infringement thus terminated in 1955, it would seem that the perpetual injunction included in the interlocutory judgment would no longer be a proper element of relief.
This Part of the opinion, like Part I, expresses the views of Justices Harlan, Brennan, Stewart, White and Goldberg.
This Part of the opinion expresses the views of Justices Brennan, Stewart, White, and Goldberg. Mr. Justice Harlan considers that the matters here dealt with are not ripe for decision and should be left for determination in the future course of this litigation.
AB’s counsel asserted on deposition: “I believe we would have the right to arrive at royalty and otherwise consider as patented the replacement top . . . .” When asked by the District Court at a hearing concerning a judgment bond how much he expected to recover, CTR’s counsel replied: “I suppose a reasonable royalty would be 5 per cent.” Considerable evidence was introduced .before the Master as to Aro’s income from infringing sales and as to royalty rates fixed in licenses granted by CTR or AB to other replacement-fabric suppliers. See also the statement of AB’s counsel quoted in note 12, swpra, and the statement in CTR’s brief quoted supra, at 496.
In the 1952 codification, §§ 67 and 70 of the 1946 Code were consolidated in the present § 284. The stated purpose was merely “reorganization in language to clarify the statement of the statutes.” H. R. Rep. No. 1923, 82d Cong., 2d Sess., at 10, 29.
See also Hearing before the House Committee on Patents, 79th Cong., 2d Sess., on H. R. 5231 (subsequently amended, reintroduced, and reported as H. R. 5311), Jan. 29, 1946, e. g., pp. 2-3.
No answer was given by AB’s counsel to the question how the $73;000 figure had been arrived at, except to say that it would have been larger if it had been intended to release contributory infringers as well. But the fact that paragraph 3 of the agreement provides for a 5% royalty on replacement tops, as the General Motors license agreement also apparently did, suggests that the effective royalty received from Ford for the right to make and sell the patented top-structures was the same as that received from General Motors.
See also Thomson-Houston Elec. Co. v. Ohio Brass Co., supra, 80 F. 712, 721; Rep. Atty. Gen. Nat. Comm, to Study the Antitrust laws, supra, at 252; Rich, 21 Geo. Wash. L. Rev. 521, 542 (1953); Eastman, 48 Mich. L. Rev. 183, 187 (1949); Note, 66 Yale L. J. 132 (1956).
Reed Roller Bit Co. v. Hughes Tool Co., 12 F. 2d 207, 209, 210 (C. A. 5th Cir. 1926).
National Brake & Elec. Co. v. Christensen, 38 F. 2d 721 (C. A. 7th Cir. 1930); Graham v. Mason, 10 Fed. Cas. 930 (No. 5,672) (C. C. D. Mass. 1872).
E. g., Conmar Products Corp. v. Tibony, 63 F. Supp. 372, 374 (D. C. E. D. N. Y. 1945).
Concurring Opinion
concurring.
I agree with my Brother Black that the plain language and legislative history of § 271 (c) require the alleged contributory infringer to have knowledge of the infringing nature of the combination to which he is contributing a part. Otherwise I' share Mr. Justice Brennan’s view of this case.
Section 271 (a) imposes no comparable requirement of knowledge in the case of the direct infringer who makes or uses the patented combination and § 287 does not say that one who makes or uses without knowledge is not infringing. It specifies that the “infringer” is not liable for damages until notice of the “infringement.” In any event, § 287, as my Brother Brennan says, is not applicable here under Wine Ry. Appliance Co. v. Enterprise Ry. Equipment Co., 297 U. S. 387, because the patentee has not manufactured the article and has had no opportunity to mark it in accordance with § 287.
Here the patentee gave notice to Aro and I think it is liable on Ford tops sold by it after that date, but not before, unless it had knowledge from other sources. After the notice date, the knowledge requirement of § 271 (c) was satisfied and the use of Ford cars by the owners thereof was direct infringement providing the necessary predicate for contributory infringement under §271 (c).
Dissenting Opinion
dissenting.
For a number of reasons I would reverse the judgment, and reinstate the order of dismissal of the District Court.
I.
With regret I find it necessary to disagree with the inferences the Court draws from the past history of this case. Respondent Convertible held exclusive rights for Massachusetts in a combination patent on a convertible automobile top, the combination consisting of wood or metal supports, a fabric cover, and a mechanism to seal the fabric against the side of the automobile in order to keep out weather. None of the elements of the combination was patented or patentable. During the years in question General Motors Corporation and the Ford Motor Company manufactured automobiles with tops like those described in the patent. General Motors had a license from Convertible authorizing it to do so. Ford did not. Petitioner Aro manufactured and sold fabric replacement covers which were purchased by owners of both General Motors and Ford cars when the covers originally installed on the cars wore out. Convertible settled a claim it made against Ford for direct infringement, and did not sue Ford dealers or Ford car owners. It maintained also that the individual General Motors and Ford car owners who replaced their worn-out covers with Aro replacement covers by doing so directly infringed the combination patent. Convertible did not sue the individual car owners who patched or replaced the worn-out fabric, but it did bring this suit against Aro, charging that Aro by selling the replacement fabric thereby helped the individual car owners infringe and so became liable as a con-
When the District Court received the mandate of this Court, it entered judgment dismissing the complaint on the ground that this Court’s decision and mandate had reversed the prior judgment in its entirety. But Convertible appealed the dismissal to the Court of Appeals. That court said:
“The puzzling question is whether the Supreme Court in reversing this court intended to reverse in toto or only to reverse insofar as replacement tops for General Motors cars were concerned.” 312 F. 2d 52, 56 (C. A. 1st Cir.).
Thereupon the Court of Appeals, reversing the District Court’s action taken in obedience to this'Court’s man
“Our decision dealt, however, only with the General Motors and not with the Ford cars.” Ante, p. 479.
The Court’s statement of what we did is, I think, completely refuted by the record in this case.
The opinion of the Court was delivered by Mr. Justice Whittaker. That opinion was joined by The Chief Justice, Mr. Justice Black, Mr. Justice Douglas, and Mr. Justice Clark. The grounds for the Court’s opinion, as I shall point out, applied alike to the repair of Ford cars which had originally been sold by the manufacturer without a license from Convertible, and to General Motors cars that had been sold with such a license. Mr. Justice Brennan, however, dissented from the grounds of the Court’s opinion although he concurred in the judgment of reversal “except, however, as to the relief granted respondent in respect of the replacements made on Ford cars before July 21, 1955.” 365 U. S., at 368. Mr. Justice Harlan, joined by Justices Frankfurter and Stewart, dissented from the Court’s opinion and from its judgment in its entirety. 365 U. S., at 369. His grounds for dissenting from the Court’s opinion were substantially the same as those of Mr. Justice Brennan.
The difference in the approach of Justices Harlan and Brennan from that of Mr. Justice Whittaker, writing for the Court, is responsible, as I read the record, for the fact that while the Court reversed the former judgment in its entirety, Mr. Justice Brennan was willing to reverse it only as to replacement fabrics sold for General Motors cars. Mr. Justice Brennan believed that since the licensed General Motors cars as built did not directly infringe the patent and Aro contributed to what did not amount to a “reconstruction” of them, Aro as to them was not a contributory infringer; the Ford cars, however, were built by the manufacturer without a license from Convertible, so Ford and the purchasers who used its cars were allegedly direct infringers, and since Aro helped Ford owners continue to use infringing tops it was a contributory infringer even though the replacement covers did not “reconstruct” the tops. The Court, however, in Mr. Justice Whittaker’s opinion, rejected completely the • notion that there could ever be within the meaning of
Mr. Justice Whittaker and the four members of the Court who joined him were, of course, familiar with the alleged distinction which Convertible tried to draw between its rights with reference to the General Motors licensed cars on the one hand and the Ford unlicensed cars on the other. The district judge in his opinion drew the distinction,
“No element, not itself separately patented, that constitutes one of the elements of a combination patent is entitled to patent monopoly, however essential it may be to the patented combination and no matter how costly or difficult replacement may be.” 365 U. S., at 345.
Finally, the Court did not conclude its opinion with the words “reversed in part and affirmed in part,” as it would have done if like Mr. Justice Brennan it had accepted Convertible’s asserted distinction. The order in the opinion by Mr. Justice Whittaker was simply, “Reversed,” which meant “Reversed,” not “reversed in part and affirmed in part.”
If all this could have left any doubt that the Court reversed the judgment of the Court of Appeals in its entirety rather than in part only, that doubt would certainly have been removed by the action taken on Convertible’s petition for rehearing or alternative motion for amendment or clarification of the Court’s judgment. This motion specifically pointed out the alleged distinction between Convertible’s rights with respect to Aro’s replace
The Court now holds that although the fabric used on these car tops was unpatented and clearly unpatentable, the combination-patentee nevertheless is free to expand its monopoly beyond the patent’s boundaries through preventing the sales of that single element, the unpatented fabric. The new majority relies largely on 35 U. S. C. § 271 (c), as did Mr. Justice Harlan, Mr. Justice Frankfurter, Mr. Justice Stewart and Mr. Justice Brennan the first time this case was here. As I said, I am satisfied with the answers given to the new majority’s interpretation of § 271 (c) by what was said in Mr. Justice Whittaker’s opinion for the Court and in my concurrence. But since the new majority is now giving Convertible a legal monopoly over the unpatented fabric cover, I find it necessary to reach the constitutional question urged by Aro.
Article I, § 8 of the Constitution gives Congress the power to “promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.” The granting of patent monopolies under this constitutional authority represents a very minor exception to the Nation’s traditional policy of a competitive business economy, such as is safeguarded by the antitrust laws. When articles are not patentable and therefore are in the public domain, as these fabric covers were, to grant them a legally protected monopoly offends the constitutional plan of a competitive economy free from patent monopolies except where there are patentable “Discoveries.” And the grant of a patent monopoly to the fabrics can no more be justified constitutionally by calling their sale by competitors “contributory infringement” than by giving it any other label. Cf. Compco Corp. v. Day-Brite Lighting, Inc., 376 U. S. 234; Sears, Roebuck & Co. v. Stiffel Co., 376 U. S. 225.
The Court holds, quite properly I think, that a pat-entee can get only one recovery for one infringement, no matter how many different persons take part in the infringement. In this case Ford, allegedly a direct infringer of the Convertible patent, made a settlement with Convertible for all past infringements in making its cars and obtained a license to use the patent in the future. The Court holds that while there can be only one recovery for the alleged infringement which Ford turned loose on the trade, Convertible should nevertheless have an opportunity to try to prove, if it can, that it settled with Ford for less than the full amount of its damages. This, I think, brings about an unjust result which the patent law does not compel. Here Ford, the principal infringer, obtained a complete release from all damages for its infringement, and I would hold that innocent purchasers of Ford cars containing the infringing devices are entitled to be released just as Ford has been. There is considerable merit and fairness in the idea that completely releasing from liability one of several persons, all of whom are obligated to another, releases them all. This is particularly so in the area of patent law, where the doctrine of contributory infringement is rested on the belief that a direct infringer may sometimes be collection-proof, and that in such a situation the patentee should be given a chance to collect its damages from a more solvent company which knowingly aided the infringement. The original infringement, if there was infringement here,
IY.
For the foregoing reasons I believe that Aro should not be held liable for any damages at all and that the District Court should be ordered to dismiss the case. A majority of the Court, however, remands the case for determination of whether and to what extent Aro is liable for damages. Whether Aro is liable for any damages at all depends on whether it and the persons to whose infringement Aro is alleged to have contributed can be held liable for damages even though they may have had no knowledge that a patent covered the top or that their conduct infringed or helped to infringe that patent. I would hold that unless there was such knowledge, there can be no infringement or contributory infringement.
Section 271 (c), the section dealing with contributory infringers (which Aro is alleged to be), provides that whoever sells a component of a patented combination “constituting a material part of the invention, knowing the same to be especially made or especially adapted for use in an infringement of such patent . . . shall be liable as
As originally drafted § 271 (c) provided:
“Whoever knowingly sells a component of a patented . . . combination . . . , especially made or especially adapted for use in an infringement of such patent . . . shall be liable as a contributory infringer.”8
Several times the House Committee considering the bill was told that because of the position of the word “knowingly” in the section it was not clear exactly how much a person had to be shown to have known before he could be held liable as a contributory infringer.
“Whoever sells a component of a patented . . . combination . . . , knowing the same to be especially*659 made or especially adapted for use in an infringement of such patent . . . shall be liable as a contributory infringer.”12
Both the House and Senate reports explained that
“This latter paragraph is much more restricted than many proponents of contributory infringement believe should be the case. The sale of a component of a patented machine, etc., must constitute a material part of the invention and must be known to be especially made or especially adapted for use in the infringement before there can be contributory infringement . . . .”13
The House Committee thus attempted to make clear that innocent persons, who acted without any knowledge that the goods they sold were adapted for use in the infringement of a patent which they knew about, could not be held liable as contributory infringers. It is hard to believe that Congress intended to hold persons liable for acts which they had no reason to suspect were unlawful, and as I have pointed out the legislative history shows Congress did not. Therefore I am wholly unwilling to construe the section as meaning that one who sells an unpatented and unpatentable piece of fabric to be used to repair an automobile top can be held liable for treble damages as a contributory infringer even though he had absolutely no knowledge that there was a patent on the top and that the top had been sold without a license, and could not, because of this lack of knowledge, have sold the top “knowing the same to be especially made or especially adapted for use in an infringement of such patent.”
Furthermore, to justify its result the Court today in defining “contributory infringement” expands the cover
The Court’s interpretation of § 271 (a) concerning the lack of necessity for knowledge before a person can be mulcted in damages for direct infringement is strangely inconsistent with another provision of the patent code, 35 U. S. C. § 287,
The tremendous burden that the Court’s construction of the patent laws will put on innocent bona fide dealers in or purchasers of unpatented products (if Congress does not change the Court’s ruling) cannot be accurately predicted. The number of patented appliances of various kinds in automobiles is certainly not small. Just a few of those that have appeared in litigation in the courts are
Neither the language nor the purpose of the patent laws requires that they be construed to bring about such threats on so wide a scale to the free functioning of our business economy and to purchasers of patented appliances who are wholly innocent of any intention to infringe patents. I do not believe that in construing the patent
I would reverse the judgment of the Court of Appeals and send the case back to the District Court with instructions to dismiss it.
“Whoever sells a component of a patented machine, manufacture, combination or composition, or a material or apparatus for use in practicing a patented process, constituting a material part of the invention, knowing the same to be especially made or especially adapted for use in an infringement of such patent, and not a staple article or commodity of commerce suitable for substantial non-infringing use, shall be liable as a contributory infringer.” 66 Stat. 811, 35 U. S. C. §271 (c).
Mr. Justice Brennan's opinion said:
“My Brother Harlan's dissent cogently states the reasons why I also think that is too narrow a standard of what constitutes impermissible ‘reconstruction.’ ” 365 U. S., at 362.
119 U. S. P. Q., at 124.
One of Convertible’s argument headings read, “The Proposed Rules of Law Propounded By Aro and the Government Cannot, Under the Facts of This Case, Extend to Ford Cars.” Brief for Respondent, Aro Mfg. Co. v. Convertible Top Replacement Co., No. 21, 1960 Term, p. 73. The argument extended over the next several pages. Id., pp. 73-76.
Respondent’s Petition for a Limited Rehearing: or, in the Alternative, Motion for Amendment or Clarification of the Court’s Opinion, Aro Mfg. Co. v. Convertible Top Replacement Co., No. 21, 1960 Term, pp. 1-13. That the replacements for Ford cars should be treated differently from those for General Motors cars was the only argument made in the petition and motion.
For discussion of the doubtful validity of this combination patent, see my concurring opinion in the former decision of this case, 365 U. S., at 350-352.
(Emphasis supplied.)
§ 231 (e), H. R. 3760, 82d Cong., 1st Sess. (Emphasis supplied.)
See, e. g., Hearings before Subcommittee No. 3, Committee on the Judiciary, on H. R. 3760, 82d Cong., 1st Sess., Ser. No. 9, p. 215.
The chief engineer and chairman of the board of a company which manufactures instruments to customers’ specifications testified: “We make a large number of devices and people come to us in the industry from distant points. . . . When you realize that there are some 600,000 patents and millions of claims involved under the present status of this bill, . . . and we become liable as contributory
“ ‘Knowingly sells’ will thus become highly controversial, and it will be construed by various patent lawyers to meet their particular situation.” Id., at 141-142.
When a witness from the Antitrust Division of the Justice Department raised the same objection, the following exchange took place:
“[Congressman] Bryson. It seems to me that if he sells it at all he knows he sells it.
“Mr. Fugate [of the Justice Department]. He knows he sells it; but, as in this case that I mentioned, the cutter of the metal plate according to a special pattern didn’t know that that was to be used in an infringing manner, that it was to be used in a patented combination.
“[Congressman] Rogers. Inasmuch as you recognize that the law still gives a cause of action against the contributor who helps infringe, would there be any objection on the part of the Justice Department to clarify that law in definite words so that there would not be the confusion that the gentlemen have testified to?” Id., at 164r-165.
Mr. Giles S. Rich of the National Council of Patent Law Associations stated:
“ ‘[K]nowingly sells a component of a patented machine’ means to us that you know that the component is going into that machine. You don’t have to know that it is patented. You don’t have to know the number of the patent, and you don’t have to know that the machine that it is going into constitutes an infringement. You just know its ultimate destination.” Id., at 175.
(Emphasis supplied.)
H. R. Rep. No. 1923, 82d Cong., 2d Sess., p. 9; S. Rep. No. 1979, 82d Cong., 2d Sess., p. 8.
“Patentees, and persons making or selling any patented article for or under them, may give notice to the public that the same is patented, either by fixing thereon the word 'patent’ or the abbreviation 'pat.’, together with the number of the patent, or when, from the character of the article, this can not be done, by fixing to it, or to the package wherein one or more of them is contained, a label containing a like notice. In the event of failure so to mark, no damages shall be recovered by the patentee in any action for infringement, except on proof that the infringer was notified of the infringement and continued to infringe thereafter, in which event damages may be recovered only for infringement occurring after such notice. Filing of an action for infringement shall constitute such notice.” 66 Stat. 813, 35 Ü. S. C. § 287.
The cases which the Court cites as contrary to this view neither considered nor decided the issue whether innocent persons entirely unaware that their conduct would either infringe or contribute to the infringement of a patent can be held liable as direct or contributory infringers. Wine Ry. Appliance Co. v. Enterprise Ry. Equipment Co., 297 U. S. 387, held that a primary infringer, like Ford here, which ordered manufactured for itself and which sold for profit a patented door-latch could not escape liability for infringement simply because a statutory notice of the patent was not marked on the infringing latches. The Court pointed out that the patentee had never had an opportunity to attach a notice because the in-fringer was producing the latches without the patentee’s knowledge. The situation in the case before us, involving an asserted liability of consumers of unmarked goods, rather than a seller of those goods for profit, does not even remotely resemble that in Wine. In none of the other cases relied on was § 287 interpreted or even considered by the Court.
See 35 U. S. C. A. § 271, n. 139.
Reference
- Full Case Name
- ARO MANUFACTURING CO., INC., Et Al. v. CONVERTIBLE TOP REPLACEMENT CO., INC.
- Cited By
- 412 cases
- Status
- Published