Watson v. United States

46 Citing cases

  1. Bell Intercontinental Corp. v. United States

    381 F.2d 1004 (Fed. Cir. 1967)   Cited 44 times
    In Bell Intercontinental Corporation v. Commissioner, supra, the Court of Claims approved as a sale a transfer of a patent which excluded the benefits of a return license like the present ones.

    Reid, 26 T.C. 622, 632 (1956); Eterpen Financiera Sociedad de Responsabilidad Limitada v. United States, 108 F. Supp. 100, 104-105, 124 Ct.Cl. 20, 28-30 (1952), cert. denied, 346 U.S. 813, 74 S.Ct. 22, 98 L.Ed. 340 (1953). The question does not depend upon the labels or the terminology used in the agreement; hence, the fact that an agreement is termed a license and that the parties are referred to as licensor and licensee is not decisive. E.g., Kronner v. United States, 110 F. Supp. 730, 734, 126 Ct.Cl. 156, 163 (1953); Watson v. United States, 222 F.2d 689, 691 (10th Cir. 1955); Kimble Glass Co., 9 T.C. 183, 190 (1947). Nor is the question governed by the method of payment, and it is, therefore, immaterial that payment is based on a percentage of sales or profits, or on an amount per unit manufactured.

  2. First National Bank of Princeton v. United States

    136 F. Supp. 818 (D.N.J. 1955)   Cited 20 times   1 Legal Analyses

    There is an impressive array of authority contrary to the contention of the government. Watson v. United States, 10 Cir., 1955, 222 F.2d 689, 691; United States v. Carruthers, 9 Cir., 1955, 219 F.2d 21, 26; Commissioner v. Celanese Corp., 1944, 78 U.S.App.D.C. 292, 140 F.2d 339; Commissioner of Internal Revenue v. Hopkinson, 2 Cir., 1942, 126 F.2d 406, 409-410; Kronner v. United States, 1953, 110 F. Supp. 730, 734, 126 Ct.Cl. 156; Lamar v. Granger, D.C.W.D. Pa. 1951, 99 F. Supp. 17, 36, 38. See also Allen v. Werner, 5 Cir., 1951, 190 F.2d 840. Neither can the government prevail in its contention that the obligation of Prof. Cooke to defend patent infringement suits brought against Pro Phy Lac Tic because of the patents originally held by him and to save Pro Phy Lac Tic harmless therefrom constitutes the reservation by Prof. Cooke of a proprietary interest in the patents sufficient to preclude the existence of a sale.

  3. ARK PATENT INTL., LLC v. TARKSOL INTL., LLC

    2009 N.Y. Slip Op. 52688 (N.Y. Sup. Ct. 2009)

    Accordingly, insofar as plaintiff's motion seeks a declaration that the Exclusive License Agreement is a license, it is denied. But see Watson v. United States, 222 F.2d 689, 691 (10th Cir. 1955) (royalty provisions did not reserve any control); Sybron Transition Corp., 770 F. Supp. at 809 (reservation of a royalty does not defeat assignment) (collecting cases).But see Watson, 222 F.2d at 691("precautionary provision was intended to protect the rights of the parties under the contract, not to proscribe, limit, or nullify their intent and purpose to vest immediately in the transferee the right to manufacture, sell, and use the carts throughout the life of the patent"); Speedplay, Inc. v. Bebop, 211 F.3d 1243, 1252 (Fed. Cir. 2000)("the principle of Vaupel [cited in fn 8, below] compels a conclusion that the consent requirement does not significantly restrict the scope of Speedplay's rights in the '778 patent").

  4. Bannister v. United States

    262 F.2d 175 (5th Cir. 1958)   Cited 16 times

    (6) It erred in failing to hold that each seperate claim in a patent is a separate invention. Roe v. United States, D.C., 138 F. Supp. 567; United States v. Carruthers, 9 Cir., 219 F.2d 21; Allen v. Werner, 5 Cir., 190 F.2d 840; Watson v. United States, 10 Cir., 222 F.2d 689; Lawrence v. United States, 5 Cir., 242 F.2d 542; Storm v. United States, 5 Cir., 243 F.2d 708; Rollman v. Commissioner, 4 Cir., 244 F.2d 634; Dairy Queen of Okla., Inc. v. Commissioner, 10 Cir., 250 F.2d 503. Pointing out that those enactments were declaratory of the controlling decisions and insisting that they must be liberally construed in the light of the circumstances of their enactment and the reports accompanying their passage, they argue that the district judge, instead of following the practical construction given by the courts and admonished by the statute, approached and decided the case from an unduly technical and restricted standpoint.

  5. Rollman v. Commissioner of Internal Revenue

    244 F.2d 634 (4th Cir. 1957)   Cited 29 times   1 Legal Analyses
    In Rollman v. Commissioner of Internal Revenue, 244 F.2d 634 (4th Cir. 1957), the transfer documents expressly provided that the grantee could not grant sublicenses under the patents except with the written consent of the transferor.

    Moreover, the assignor retains no use of the patent for himself by reason of the limitation since he has granted the exclusive rights to the assignee and cannot grant a sub-license without the purchaser's consent. See Allen v. Werner, 5 Cir., 190 F.2d 840; Watson v. United States, 10 Cir., 222 F.2d 689; Platt v. Fire-Extinguisher Mfg. Co., 3 Cir., 59 F. 897; Crook v. United States, D.C., 135 F. Supp. 242; First National Bank of Princeton v. United States, D.C., 136 F. Supp. 818; Parke Davis Co. v. Commissioner of Internal Revenue, 31 B.T.A. 427, 430; General Spring Corp. v. Commissioner of Internal Revenue, 12 T.C.M. 847. The purchase price to be paid by Rikol for rights under the Rajeh patent was fixed by the agreement of December 19, 1940, at 3 per cent of the total net cash receipts from sales of the shoes made and sold by Rikol; and on this account the Commissioner makes the additional contention, which was not considered in the opinion of the Tax Court, that the transfer did not amount to a sale.

  6. C.A. Norgren Co. v. United States

    268 F. Supp. 816 (D. Colo. 1967)   Cited 5 times

    For example, the fact that the agreement was labeled a 'license' and the payments incident to it were referred to as 'royalties' does not preclude a finding that an affective 'assignment' took place for tax purposes. Dairy Queen of Oklahoma, Inc. v. Commissioner, 250 F.2d 503 (10th Cir. 1957); Watson v. United States, 222 F.2d 689 (10th Cir. 1955). The critical question is still whether all substantial rights were in fact transferred.

  7. Walen v. United States

    273 F.2d 599 (1st Cir. 1959)   Cited 11 times
    In Walen v. United States, 1 Cir., 273 F.2d 599, 601, it was stated with reference to the "right of recapture", that the courts usually inquire whether such powers are designed simply to protect the transferor's interest in the continuance of the purchase payments.

    It is true that a transaction is to be judged by its substance, and not by verbiage. Waterman v. Mackenzie, 1891, 138 U.S. 252, 11 S.Ct. 334, 34 L.Ed. 923; Watson v. United States, 10 Cir., 1955, 222 F.2d 689, 691. Thus the fact that the purchase price has been termed "royalties," and is computed after the manner of royalties, does not necessarily mean that there was not a sale, Commissioner of Internal Revenue v. Hopkinson, 2 Cir., 1942, 126 F.2d 406, 410; Rollman v. Commissioner, 4 Cir., 1957, 244 F.2d 634, 640-641, and an exclusive license for the life of the patent is usually regarded as a transfer of all substantial rights.

  8. Schmitt v. C.I.R

    271 F.2d 301 (9th Cir. 1959)   Cited 17 times

    A transfer which is not exclusive, or is limited (other than territorially), becomes a license and not an assignment. Waterman v. Mackenzie, supra; Watson v. United States, 10 Cir., 1955, 222 F.2d 689; Vincent A. Marco, 1955, 25 T.C. 544, 548; Edward C. Myers, 1946, 6 T.C. 258. "Where he [the patentee] transfers less than all three rights to make, use and vend for the term of the patent, or transfers them nonexclusively, the transfer is a mere license and does not convey any title in the patent itself." Kimble Glass Co., 1947, 9 T.C. 183, 190, quoted in William M. Bailey Co., 15 T.C. 468 at page 484.

  9. Dairy Queen of Oklahoma v. Commissioner

    250 F.2d 503 (10th Cir. 1957)   Cited 36 times

    From the logic employed and the authorities cited, the Court seems to rely upon the doctrine of indivisibility, usually applicable in cases like this to contracts involving patents and copyrights. Under this accepted principle, a contract conveying the exclusive right to make, use and vend an invention or an undivided part or share of that exclusive right in the United States or within a specified area, constitutes an assignment of the patent, complete or partial as the case may be, and any transfer short of that is not an assignment but a license. Watson v. United States, 10 Cir., 222 F.2d 689; Broderick v. Neale, 10 Cir., 201 F.2d 621; Cleveland Graphite Bronze Co. v. Commissioner, 10 T.C. 974; Federal Laboratories, Inc. v. Commissioner, 8 T.C. 1150; Cory v. Commissioner, 2 Cir., 230 F.2d 941. But see also Goldsmith v. Commissioner, 2 Cir., 143 F.2d 466, and Frankfurter dissenting in Commissioner v. Wodehouse, 337 U.S. 369, 401, 69 S. Ct. 1120, 93 L.Ed. 1419; Fulda, Copyrights Assignments and Capital Gains Tax, 58 Yale Law Rev. 245. We agree with the Tax Court that the taxpayer assayed to convey only a single bundle of rights, and that the use of the patent was only one of the sticks in that bundle.

  10. Sybron Transition v. Nixon, Hargrave

    770 F. Supp. 803 (W.D.N.Y. 1991)   Cited 11 times

    They could have called it whatever they pleased; it is still an assignment. See also Watson v. United States, 222 F.2d 689, 691 (10th Cir. 1955) (consistent use of "license," "licensor" and "licensee" "did not fix, limit, or qualify the scope of the grant.").