Opinion
May 23, 1945.
June 29, 1945.
Judgments and decrees — Res judicata — Matters previously determined — Accounting — Action to recover royalties under patent license.
Where, in an action to recover royalties under a patent license, the Supreme Court had determined in a prior appeal that plaintiff's patent was valid and the contract enforceable, and had remanded the case for an accounting; and it appeared that defendant had voluntarily furnished a statement of account, the accuracy of which was admitted; it was Held that defendant's exceptions to matters ruled upon in the prior proceedings were properly dismissed.
Argued May 23, 1945.
Before MAXEY, C. J., DREW, LINN, STERN, PATTERSON, STEARNE and JONES, JJ.
Appeal, No. 172, March T., 1945, from judgment of C. P., Allegheny Co., April T., 1942, No. 1776, in case of Westinghouse Electric and Manufacturing Company v. Alpine MacGregor. Judgment affirmed.
Assumpsit.
The facts are stated in the opinion by SOFFEL, J., of the court below, THOMPSON, SOFFEL and CHALLENER, JJ., as follows:
This case is before the court on defendant's exceptions to Findings of Fact, Conclusions of Law, and Order entered by the Court on an accounting.
Westinghouse Electric Manufacturing Company, a corporation, the plaintiff, brought suit to recover from Alpine MacGregor, the defendant, royalties under a patent license. The patent covers a solder comprising copper and phosphorus in certain proportions. Sued in the United States District Court for infringement of the licensed patent, the instant defendant settled that suit by taking out the license here involved. He paid royalty for several years and then refused to make further payments. Suit was then brought in this court to enforce the contract.
At the trial of the case in April, 1943, the defendant introduced evidence to show that his product does not come under the patent. The Trial Court found that the three solders manufactured by the defendant come under plaintiff's patent and are therefore within the terms of the license contract on which suit was brought. The defendant also attacked the validity of the patent under which he was licensed to make, use, and sell the solder covered by plaintiff's patent No. 1651709 for the reason that the contract provides defendant shall not sell the licensed solder at prices lower than those for which the plaintiff sells the patented solder. It was and is defendant's theory that the licensed patent is invalid; that therefore it furnishes no valid basis to fix prices by agreement; and that the contract is therefore as a whole unenforceable because of the federal law. It is the plaintiff's position, first, that the patent is prima facie valid, and second, that defendant, having voluntarily taken a licensed patent, in order to avoid litigation in the federal court in which the defendant was accused of infringing the patent, is estopped to deny validity of the patent so long as he operates under the license.
Evidence which defendant sought to introduce in order to attack the validity of the patent was objected to by the plaintiff on the ground that the defendant was estopped to attack the validity of the patent under which he was licensed. The objection was sustained and such proofs excluded.
On July 7, 1943 the Trial Court filed an opinion discussing the issues, made findings of fact and conclusions of law sustaining plaintiff's position on all points, and ordered an accounting to determine the amount of royalty due and unpaid. The exceptions taken by defendant were argued before a court en banc, consisting of Judges MCNAUGHER, RICHARDSON and SOFFEL. On January 24, 1944 the court en banc overruled all of defendant's exceptions and sustained the position of the Trial Court. An appeal was taken by defendant to the Supreme Court of Pennsylvania. In an opinion by Mr. Chief Justice MAXEY, reported in 350 Pa. 333, the Supreme Court affirmed the decision of the Trial Court. The case was then remanded to the Court of Common Pleas for an accounting.
The defendant then voluntarily furnished plaintiff with a statement in the form of a letter admitting that under the terms of the licensed contract royalty due and unpaid amounted to $15,485.96. A hearing was had before the original Trial Judge. The statement of defendant was offered in evidence. Defendant admitted that if anything were payable the amount due was the sum of $15,485.96, but objected to receipt of the evidence on accounting and to entry of any judgment on the ground that the licensed contract is illegal under federal law and therefore no payment should be required of defendant. Defendant's objections were overruled.
On March 2, 1945 the Court filed findings of fact, discussion, conclusions of law, and an order directing the Prothonotary to enter judgment in favor of the plaintiff and against the defendant in the sum of $15,485.96. Defendant's exceptions to this adjudication are now before the instant court.
It is our opinion that the exceptions are without merit and should be dismissed. They are directed to matters ruled upon previously in this litigation by the Trial Court, and have been affirmed by a court en banc and by the Supreme Court of Pennsylvania. So far as the instant proceeding is concerned, they are res judicata as to all issues previously considered and acted upon. The only thing the defendant could attack in the instant proceeding is the amount due or the procedure on accounting to determine the amount. The only issue before the court in the instant proceeding is, How much does the defendant owe the plaintiff?
The defendant voluntarily furnished to plaintiff a statement of account, the accuracy of which is not questioned by either party, and since no question of procedure in arriving at that amount has arisen, it is obvious that no justiciable issue is involved in this case at this time. The defendant here reiterates the position taken originally before the Trial Court that the licensed contract is unenforceable because it contains a price-fixing clause and because the patent is invalid. These matter were previously determined and are not germane to the issue.
The first exception is directed to alleged error in overruling defendant's objection to the offer in evidence of plaintiff's accounting. Exhibit No. 1. The objection is not predicated upon any question of authority or amounts stated to be due. The objection simply states again defendant's original position that the agreement under which defendant has been ordered to account is illegal and unenforceable and the patent invalid. This position has been found untenable by this Court and by the Supreme Court of Pennsylvania. In the absence of an attack on the account as stated, the Trial Court was bound to receive it into evidence and to proceed with the accounting in accord with the prior decisions and mandate of the Supreme Court. Exception dismissed.
The second exception is directed to alleged error in overruling defendant's second objection to the offer in evidence of plaintiff's accounting, Exhibit No. 1, for the reason that under the federal laws there is not owing to the plaintiff any sum for which a lawful judgment may be entered. This exception is nothing more than a reiteration of the legal position that has been adjudicated adversely to the defendant in this court and the Supreme Court of Pennsylvania. No question of procedure is here raised. Exception dismissed.
The third, fourth, and fifth exceptions are predicated upon defendant's position that the three forms of solder manufactured by him do not come under the licensed patent of the plaintiff. These exceptions raise again questions ruled upon in the prior litigation. No new matter of any kind bearing upon them has been presented in this accounting. Third, fourth, and fifth exceptions dismissed.
The sixth, seventh, eighth, and ninth exceptions are advanced to attack the validity of the licensed patent on the basis of a publication (Gulliver) that was in evidence originally before the Trial Court. Defendant's position was held untenable at that time. The Trial Court was affirmed by the Supreme Court on this matter. The question raised by these exceptions is not part of the accounting proceeding. Sixth, seventh, eighth, and ninth exceptions dismissed.
The tenth exception refers substantially to the same matter as has been raised by the third, fourth, and fifth exceptions. It includes a reference to the amount found due in the accounting proceeding, but raises no point of law regarding the quantum of the amount or the procedure by which it was determined. The exception raises nothing that has not been previously decided and brings in no new evidence or law. Exception dismissed.
The eleventh exception raises the same matter as has been discussed in connection with the sixth, seventh, eighth, and ninth exceptions. Exception dismissed.
The twelfth, thirteenth, and fourteenth exceptions seek to raise the question of the validity of the licensed patent. There is nothing new in the accounting record that gives any basis for re-argument or re-considering this question. Exception dismissed.
The fifteenth exception goes to the merits of the case as a whole, namely, the enforceability of the contract. That was tried and determined before the accounting proceeding was held. No new evidence or matter of any kind bearing on that question has arisen in the accounting proceeding. The unenforceability of the contract cannot be raised here. Exception dismissed.
The sixteenth exception is substantially the same as the fifteenth, except that it refers to the "federal" laws. This is a matter considered and determined adversely to the defendant in the litigation prior to the accounting. There is no basis in the accounting record for re-arguing this question. Exception dismissed.
The seventeenth exception is directed to the order entered by the Trial Judge in the accounting. Since the case in the prior litigation was decided on the merits on all points for the plaintiff and against the defendant, an accounting ordered by the Supreme Court, and an accounting held, at which the amounts were supplied by the defendant himself, and no objection being raised to the manner or form of accounting and procedure by the defendant, there is no valid basis to an objection to the entry of the order of the Trial Court. Exception dismissed.
Judgment will therefore be entered in favor of the plaintiff and against the defendant.
Defendant appealed.
William B. Jaspert, for appellant.
Jo. Baily Brown, with him Smith, Buchanan Ingersoll and Brown, Critchlow Flick, for appellee.
The judgment of the court below in favor of the plaintiff against the defendant in the sum of $15,485.96 is affirmed on the opinion of Judge SOFFEL, and in accordance with the opinion we heretofore filed in this case.
REPORTER'S NOTE: On November 5, 1945, a petition by defendant for a writ of certiorari was granted by the Supreme Court of the United States, 326 U.S. __________.