Statement of the Case.

22, 1881, at Hartford, Connecticut, and elsewhere in the plaintiffs' territory, and without their license or consent, made and used, and vended to others to be used, the patented invention, and within those dates did ship from Bay City, Michigan, to the Hartford Steam Company, of Hartford, Connecticut, large quantities of wooden pipe embodying the patented invention, with intent that the same should be laid and used at Hartford, and thus infringed the right of the plaintiffs under the patent, to their damage $5000.

The defendant joined issue, a trial by jury was duly waived, and the case was tried before Judge Brown, the District Judge, now a member of this court. He found in favor of the defendant, and a judgment in his favor for costs was entered. The opinion of Judge Brown is reported in 40 Fed. Rep. 887. The Circuit Court found the following facts:

"1. That, during all the times hereinafter mentioned, the plaintiffs in the action were assignees and owners of letters patent No. 45,201, dated November 22, 1864, granted to Arcalous Wyckoff for an improved pipe for gas, water, etc., for New York, New England, and all the Eastern States north of the Carolinas, and carried on business as manufacturers of the patented pipe at Tonawanda, in the State of New York, with sufficient facilities to supply the market in all the territory owned by them, and that, at the time of the sale of the pipe or casings hereinafter mentioned, defendant's firm was aware of the plaintiffs' title to said patent for the State of Connecticut.

"2. That the firm of Ayrault, Jennison & Co., which was composed of the defendant, Susan Hill, and one Miles Ayrault, was the assignee and owner of the same patent for the State of Michigan, and, during the greater part of the year 1880, manufactured and sold the patented pipe at Bay City, in the State of Michigan, to various persons.

"3. That, in the year 1880, the firm of Andrew Harvey & Son did business in Detroit, Michigan, as machinists and manufacturers of valve fittings and other supplies.

"4. That, in the fore part of 1880, the Hartford Steam Co., a corporation organized, existing, and doing business under the

Statement of the Case.

laws of the State of Connecticut, at Hartford, in said State, undertook the project of laying down lines of steam-pipe apparatus for heating purposes in the streets of said Hartford, and that they had considerable correspondence with said Harvey & Son as to the best prices they could get for pipe casings and iron pipes, and also as to the best terms for freight from Bay City, Michigan, and elsewhere to Hartford, Connecticut; that, on the 5th day of May, 1880, said Hartford Steam Co., which had been negotiating for several weeks with Harvey & Son concerning the said project, completed a contract with them to lay down in Hartford the said steam supply apparatus.

"5. That said Harvey & Son entered upon the performance of said job at Hartford as the agent and under the directions of the said Hartford Company; that they were also employed and acted as the agent of said Hartford Steam Supply Company in obtaining for them the best prices they could in the purchase of iron and wooden pipes, and in obtaining the best rates they could for freight from Michigan or elsewhere, and in obtaining rebates in freight when necessary; and that said steam company relied upon their judgment in said matters; and that, in all their negotiations and dealings with Ayrault, Jennison & Co., they acted on behalf of, and as the agents merely of, said Hartford Steam Co.

6. That after said Hartford Co. had perfected said contract with said Harvey & Son, they sent various written orders, during the year 1880, by mail, to the address of said defendant at Bay City, Michigan, to ship to them at Hartford, Connecticut, certain quantities of wooden piping; that said defendants accepted the same and manufactured said piping at their factory under said patents and in conformity with the description and covered by the claim of said Wyckoff patent, and sold and delivered the same to the said Hartford Co. on board the cars at Bay City, Michigan, addressed to them, and that they had nothing to do with said piping after the delivery of the same on the cars at Bay City; that said Hartford Co. paid the freight thereon from Bay City to Hartford and sent drafts for the payment of said piping to defendants at Bay

Argument for Plaintiff's in Error.

City; that none of the wooden pipes used in the laying of said steam-supply apparatus at Hartford were sold to said Harvey & Son, but were all sold to said Hartford Steam Co., and that any orders made by Harvey & Son were made merely as the agents of the Hartford Steam Co.

"7. That said piping so purchased was laid down in Hartford during the term of said patent, and that during the negotiations connected with the sales and shipment of said pipe or casing defendant's firm knew that it was for use in the construction of steam-heating works in the city of Hartford, State of Connecticut, and that said Harvey & Son were to lay said pipe in Hartford.

"8. That the accounts for said sales to said Hartford Co. were kept on the books of said Ayrault, Jennison & Co. in the name of the Hartford Steam Co., and that a statement of the entire account from their books of said sales was sent to them at the close of the year.

"9. That said pipe or casing was laid down as a part of said works during the life of said patent, in the summer and fall of 1880, under said Harvey's directions, in the streets of Hartford.

"10. That by the acts and doings of defendant's firm in the premises, as above stated, the plaintiffs sustained damage, and if any recovery were permissible under the rules of law, they would be entitled to an inquiry to ascertain the amount of such damage, based on the testimony introduced by said plaintiffs."

As a conclusion of law from the foregoing facts, the court found that the plaintiffs were not entitled to recover in the action. The plaintiffs excepted to the conclusion of law and to the judgment, and brought a writ of error.

Mr. James A. Allen for plaintiffs in error.

The hindrance to carrying out the views of the court below on the merits of the case, was found in the authority of Adams v. Burke, 17 Wall. 453. The plaintiffs in error seek on this appeal a review of the application which has been made of

Argument for Plaintiffs in Error.

Adams v. Burke, to this case, rather than of the essential doctrine of that case. The contention of the dissenting members of this court in that cause was that use of a patented article lawfully purchased of an assignee of specific territory could only be had within such territory and in no case beyond or outside it within the United States, and that, as to use of the thing patented, the purchaser only acquired the right to such use within the territory held by the seller. A case may possibly arise in which this court will be called on to revise or modify the ruling of the majority of this court in deciding against this contention; but it is our view that the present case does not involve it. In Adams v. Burke, it is assumed that the patented coffin-lids were first lawfully sold to the purchaser without condition or restriction by assignees of the patent for the territory of Boston and vicinity; and then the question is presented whether, as an incident of such a lawful sale, the buyer could use outside the limits of the title of the assignor the article so lawfully and rightfully purchased. The case was heard on bill and plea, and the plea, which was accepted as true, and which was entitled to be liberally construed in favor of the pleader, expressly stated that the coffins containing the invention were manufactured by Lockhart & Seelye within a circle whose radius was ten miles, having the city of Boston as its centre, and sold within said circle by said Lockhart & Seelye without condition or restriction. The validity of the sale by Lockhart & Seelye was in that case assumed throughout, and no contest made upon it; only the effect and incidents of such a lawful sale were disputed and considered. There was no showing that the sellers sold the patented coffin-lids for use in other territory, or that they knew of or had in view any such use. In both stages of this case, in all references made to it, the lawfulness of the sale by Lockhart & Seelye to Burke was conceded and the dispute was whether or not, the sale and purchase being valid and lawful, as an incident thereof the purchaser might use the goods in other territory. In the present case the lawfulness, as against the plaintiffs in error, of the alleged sale of the patented pipe by Ayrault, Jennison & Company in the actual

Opinion of the Court.

circumstances of such sale, is exactly what is contested; the claim of the plaintiffs being that such sale and the shipments thereunder expressly for use within the territory of the plaintiffs, constituted an invasion upon the rights of the plaintiffs and as against them were unlawful. Actual sale, delivery and acceptance of the pipe at Bay City for general use, would be one thing; a form of delivery at Bay City with acceptance at Hartford, and knowledge and intent on the part of the seller that the sole use would be at Hartford, and shipments on that basis and understanding as against the plaintiffs, in our view would not constitute a lawful sale of the pipe at Bay City. The transaction would be treated in the light of its purpose and effect as a raid or invasion on the plaintiffs' territory and an attempt to displace and intrude upon his rightful market. If the defendants sought protection in such a transaction through a mere arrangement that delivery should be on cars at Bay City, the shield would be unavailing. The law would stamp the transaction with its real attributes and deem it unlawful.

The general current of decisions in the Circuit Courts has shown no inclination to extend the doctrine of Adams v. Burke, by loose or liberal interpretations. In those courts it has been repeatedly ruled that a sale in the territory of one assignee for the purpose of selling again to users in the territory of another assignee was unlawful. California Electrical Works v. Finck, 47 Fed. Rep. 583; Standard Folding Bed Co. v. Keeler, 37 Fed. Rep. 693; Hatch v. Adams, 22 Fed. Rep. 434; Hatch v. Hall, 30 Fed. Rep. 613.

Mr. George H. Lothrop for defendant in error.

MR. JUSTICE BLATCHFORD, after stating the case, delivered the opinion of the court.

As a result of the findings of fact, the Circuit Court held that the sale and delivery of the pipe by the defendant were made at Bay City, Michigan, but that, in view of the decision of this court in Adams v. Burke, 17 Wall. 453, the defendant