Opposition Brief — Walker Process Equipment, Inc. v. Food MacHinery & Chemical Corp.

CITATION TO OPINION BELOW

JURISDICTION

STATUTES INVOLVED

QUESTIONS PRESENTED

STATEMENT OF THE CASE

ARGUMENT

INDEX

I. There is Nothing of Special Public Importance

IL.

in the Questions Presented by Petitioner

There is No Conflict Whatever between the De-

cision of the Court of Appeals and this Court’s

Decision in Shawkee Mfg. Co. v. Hartford-Em-

pire Co.

. The Question of Affirmative Relief by a Third

Party Allegedly Injured by Another Party’s

Fraudulent Procurement of a Patent has Long

Ago Been Settled by this Court

. Obtaining of a Patent by Fraud on the Patent

VI.

CONCLUSION

Office is Not, Without More, a Violation of the

Federal Antitrust Laws

. The Stricken Pleading Does Not Set Forth a

Claim for Relief Based Upon an Unreasonable

Restraint of Trade Under the Sherman Act.... .

The Question of Attorneys’ Fees does not Justify

Review by this Court

ii

List Or Auruorrries Crrep.

STaTurTEs, Buias anp Texts.

Clayton Act, section 4, 15 U.S.C. section 15

Judiciary Act, section 1254, 28 U.S.C. section 1254 ...

Patent Act, section 102(b), 35 U.S.C. section 102(b) ..

Patent Act, section 285, 35 U.S.C. section 285

Sherman Act, section 2, 15 U.S.C. section 2

Federal Rules of Civil Procedure, 28 U.S.C. Rule 8 ....

Report of The Attorney General’s National Committee

To Study the Antitrust Laws (1956) p. 254

Cases.

Brown Shoe Company v. United States, 370 U.S. 294 ..

Cameron Iron Works, Inc. v. Edward Valves, Inc., 175

F. Supp. 423

Eckert v. Braun, 155 F. 2d 517

Fashion Originators’ Guild v. F.T.C., 312 U,S. 457 ..

Hartford-Empire Co. v. Shawkee Mfg. Co., 163- F. 2d

474

Hazel-Atlas Glass Co. v. Hartford-Empire Co., 322

U.S. 238

Minnesota Mining & Manufacturing Co. v. ‘ite 145

F. 2d 25

Morton Salt Co. v. Suppiger, 314 U.S. 488

Mowry v. Whitney, 81 U.S. 434

Northern Pacific Railway Co. v. United States, 356

a Be

iii

Shawkee Mfg. Co. v. Hartford-Empire Company, 322

SE scticiiiirescntenenn

Standard Oil Co. of New Jersey v. United States,

221 US. 1

Transparent Wrap Machine Corp. v. Stokes & Smith

Co., 329 U.S. 637 ..

United Mfg. & Service Co. v. Holwin Corp., 13 F.R.D.

510

United States v. Addyston Pipe & Steel Co., 85 Fed.

271, aff’d 175 US. 211

United States v. American Bell sun Co., 128

U.S. 315

United States v. Dubilier Condensor Corporation, 289

Us: PT Wosicrsiaiineie piecialanhiiciiiinstiaslaeeeaincemmnnial dadilins

United States v. E.I. duPont Pith & Co., 353

MR, MD cccccessadlidi ccc bibboeds ockckblcovtecakatuctieiatsintecientcteenvennnnanes

United States Gypsum Co. v. National ions Co.,

352 U.S. 457

United States v. Soeony-Vacoum Oil Co., 310 U.S.

SRR ~

10

15

13

13

14

EXYLANATION OF TERMS AND ABBREVIATIONS

Petitioner -— Walker Process Equipment, Inc. (Defend-

ant-Counterclaimant, Appellant in the Court

of Appeals)

Respondent — Food Machinery and Chemical Corporation

(Plaintiff-Counterdefendant, Appellee in

the Court of Appeals)

PTN — Petition for Writ of Certiorari

DA — Defendant-Appellant’s Appendix

PA — Plaintiff-Appellee’s Appendix

R — Record in Court of Appeals

IN THE

SUPREME COURT OF THE UNITED STATES

Ocroser Term, A. D. 1964.

No. 602

WALKER PROCESS EQUIPMENT, INC.,

Petitioner

vs.

FOOD MACHINERY AND CHEMICAL

CORPORATION,

Respondent

BRIEF OF RESPONDENT IN OPPOSITION

TO PETITION FOR WRIT OF CERTIORARI

The Petition sets forth no reason for the Court to ex-

ercise its certiorari jurisdiction.

In its original counterclaim (the first of three counter-

claims), Petitioner alleged:

“11. Defendant, Walker Process Equipment, Inc., as-

serts that the patent in suit is unenforceable because

Plaintiff comes to court with unclean hands with re-

spect to the patent in suit and is therefore not entitled

to relief. Defendant, Walker Process Equipment, Inc.,

asserts that this also constitutes a violation of the anti-

trust laws.” (DA 11).

Ptitioner seeks to enlist the Court’s interest by devot-

ing a considerable portion of its petition to an attempt to

establish fraud by Respondent. The alleged fraud consists

of Petitioner’s claim that the inventor falsely stated in his

patent application that there was no prior use or sale of

the subject improvements within one year from the date of

the application. Although Respondent categorically denies

the charge of fraud on the Patent Office, the question of

proof of fraud is not before this Court.

There is nothing involved at this stage of the proceed-

ings except the legal sufficiency of Petitioner’s thrice re-

modelled counterclaim, which seeks to convert a defense

of unenforceability of a patent into an affirmative action

for treble damages under the federal antitrust laws.

CITATION TO OPINION BELOW

The opinion of the Court of Appeals for the Seventh Cir-

cuit is reported at 335 F. 2d 315.

JURISDICTION

Petitioner has sought to invoke this Court’s jurisdiction

pursuant to the provisions of 28 U.S.C. sec. 1254(1).

STATUTES INVOLVED

Petitioner contends (PTN 3) that the following statutes

are involved:

Section 2 of the Sherman Act (15 U.S.C. sec. 2) pro-

hibiting monopolies, attempts to monopolize and con-

spiracies to monopolize.

Section 4 of the Clayton Act (15 U.S.C. see. 15) pro-

viding treble damage actions for persons injured in

their business or property by reason of anything for-

bidden in the antitrust laws.

Section 28 of the United States Patent Code (35

US.C. sec. 285) providing that “[t]he court in excep-

tional cases may award reasonable attorney fees to the

prevailing party.”

QUESTIONS PRESENTED

Question No. 1. as stated by Petitioner (PTN 2), if it is

to be related to the particulars of the instant case, at best

raises a question of whether a patentee’s alleged fraudulent

procurement of a patent (assuming injury to a third party

thereby), affords a third party a private action against

the patentee for treble damages under the federal anti-

trust laws.

Petitioner omits from Question No. 1. all reference to the

federal antitrust laws, and seeks to confine the question to

some sort of non-statutory claim for damages. However,

the stricken counterclaim must stand or fall as a claim for

reuef under the antitrust laws.* The only other theory of

the claim offered by Petitioner, that it was an action for

unjust enrichment, was briefed in the District Court and

abandoned by Petitioner in the Court of Appeals.

With the statement of Question No. 2 (PTN 2). it be-

comes perfectly apparent that what Petitioner really de-

sires is a determination that one who has fraudulently

procured a patent has, without more, per se violated the

federal antitrust laws.

In setting forth its Question No. 3. (PTN 2), and in

arguing the point (PTN 12), Petitioner persists in ignor-

ing the fact that the District Court permitted Respondent

* A claim of “illegal tie-ins” which was at least cognizable

as a Clayton Act section 3 or a Sherman Act section 1 action

was briefed in the District Court but abandoned by Petitioner

in the Court of Appeals.

ceassiae toms

to dismiss its own infringement suit, that there was no

' adjudication of Petitioner’s claim of fraud, and that under

such circumstances not only was the case not an “excep.

tional case” within the meaning of 35 U.S.C. Sec. 285, but

in a large sense Petitioner was not even the “prevailing

party.” The opinion of the Court of Appeals supplies ample

reason for not over-turning the District Court’s denial of

attorneys’ fees. Moreover, the issue of attorneys’ fees

is merely one of judicial discretion and clearly presents no

issue warranting review by this Court.

STATEMENT OF THE CASE

The only issue before the Court of Appeals (apart from

the tenuous issue of attorneys’ fees) was the sufficiency of a

revised defense which Petitioner also thrice sought to

assert as a counterclaim under the federal antitrust laws.

As is apparent from a brief review of the proceedings in

the District Court, Petitioner was at no time able to assert

an intelligible claim for treble damages under either the

Sherman Act or the Clayton Act. :

Respondent filed suit for patent infringement on June 24,

1960 against Petitioner.

Petitioner’s first pleading captioned “Answer and

Counterclaim for Declaratory Judgment” (DA 10) alleged

invalidity and non-infringement of Respondent’s patent and

unenforceability of the patent by reason of “unclean hands.”

Paragraph 11 (DA 11) contained a gloss in which Petitioner

. asserted that “this [presumably Respondent’s alleged un-

clean hands] also constitutes violation of the antitrust

laws.” No other reference of any kind to purported anti-

trust violations was contained in the pleading.

On October 22, 1962 (Respondent’s patent in suit having

then expired) Respondent, on its own motion, moved to dis-

miss its suit (DA 59). Petitioner countered by filing on the

same day its “Motion for Award of Actorneys Fees” (DA

55).

While Respondent’s motion to dismiss and Petitioner’s

motion for an award of attorneys’ fees were pending, Peti-

tioner filed a motion captioned “Motion to Award Damages

and Alternative Motion to Amend Counterclaim” (DA 60)

(PA1). Thereafter the District Court filed a memorandum

opinion and entered orders granting Respondent leave to

dismiss its complaint and denying Petitioner’s motion for

attorneys’ fees (DA 61-64). Leave was also granted Peti-

tioner (DA 64) to file its amended counterclaim instanter.

Thus it was not until some two and one-half years after

suit was begun, and after the issues raised by the com-

plaint had become moot and Respondent had sought volun-

tary dismissal of the complaint, that Petitioner, apparently

attempting to protract the litigation and hoping to obtain

attorneys’ fees from Respondent, sought to amend its

counterclaim in an attempt to supply new allegations

“sounding in antitrust”—something vaguely concerned

with “tie-ins” (PA 3). Petitioner thus appreciated that its

original pleading alleging, without more, that Respondent

comes to court with unclean hands and that “this also con-

stitutes violation of the anti-trust laws” (DA 11) hardly

constituted the pleading of a federal antitrust claim.

On March 20, 1963 Respondent filed a motion to dismiss

the amended counterclaim for failure to state a claim upon

which relief could be granted. After taking the matter under

advisement, the District Court struck the amended counter-

claim (R 354) as so prolix and verbose that it failed to

comply with Rule 8(e)(1), but granting Petitioner leave

to amend (R 412-416).

Petitioner then filed a third counterclaim, its second

amended counterclaim (DA 66), and Respondent filed a mo-

tion to dismiss the second amended counterclaim (DA 760),

The second amended counterclaim, if it referred at all to

“tie-ins,” did so only obliquely (DA 68), and was devoid of

any suggestion of what kind of conduct the pleader was

complaining about or of any consequent injury to Peti-

tioner. In dismissing the second amended counterclaim the

District Court readily disposed of the vague tie-in allega-

tions (DA 73), devoting its opinion to the alleged fraud

on the Patent Office.

In its brief and argument in the Court of Appeais, Peti-

tioner abandoned any conceivable claim of illegal tie-ins,

and with it the last vestige of a conceptually cognizable

federal antitrust action. Likewise, Petitioner abandoned

the contention, asserted for the first time in the second

amended counterclaim (DA 69) that Respondent in mak-

ing use of its patent was unjustly enriched at Petitioner’s

expense.

Petitioner was left with nothing to argue in the Court

of Appeals but its tenuous claim for attorneys’ fees and

the theory that unclean hands (“fraud on the Patent Of-

fice”) is coextensive with violation of the antitrust laws.

The second amended counterclaim thus returned to rest at

the starting point of the original counterclaim (DA 11,

Par. 11). It is manifest, although Petitioner is never can-

did enough to say so, that it contends, and has never really

contended anything more, that procurement of a patent by

fraud on the Patent Office is, without more, a per se viola-

tion of the federal antitrust laws.

Under the caption “Reasons for Granting the Writ”

(PTN 7), Petitioner numbers its material from 1 to 5.

Contentions set forth under the various numbers over-lap

and do not seem to comprise separate arguments. All of

Petitioner’s “Reasons” are nonetheless considered in this

Argument.

1. There is Nothing of Special Public Importance in the

Questions Presented by Petitioner.

Petitioner argues (PTN 7) that “[wlJithout action by

this Court, patents may be procured by an applicant’s

fraudulent representations to the Patent Office, and the

illegal monopoly thus obtained asserted against the public

with impunity.” Such an argument is only a carefree

stroke with a big, broad brush. The Court of Appeals con-

cisely and correctly held that although patent misuse may

be the basis of an independent antitrust action, the mere

procurement of a patent by fraud on the Patent Office,

without more, does not afford a third party (assuming

arguendo that such third party has been injured) a private

action for treble damages against the patentee under the

federal antitrust laws.

The law is well established that procurement of a patent

by fraud invalidates the patent. A third party who may

have a conceivable interest in the matter is free to infringe

or to make any other use it desires of the purportedly

patented device. In such circumstances, if the party hold-

ing the fraudulently procured patent, t.e., the invalid pat-

ent, sues the third party for infringement, the third party

may successfully defend the infringement suit on the basis

of invalidity. This is the usual, normal and typical situa-

tion respecting all disputes over the validity of patents.

There is nothing swi juris about invalidity occasioned by

fraud on the Patent Office in contrast to invalidity by

reason of lack of invention, insufficient disclosure, or in-

validity for any other reason.

The Court of Appeals pointed out (as did the District

Court) that if Petitioner had any claim of any nature, its

claim was based on proving fraud by Respondent on the

Patent Office, in which event Respondent’s patent was

invalid.

The purported fraud is bottomed on a statutory bar to

issuance of the patent; that is, Petitioner alleges that Re-

spondent in its patent application falsely stated that it

“does not know and does not believe that the same [the

subject improvements] was ... in public use or on sale in

the United States for more than one year prior to this

application.” (paras. 17, 18 DA 67)

Tf there had been in fact a public use or sale more than

one year prior to Respondeni’s application the patent would

be invalid on such grounds, regardless of alleged fraud by

Respondent. It is not the alleged fraud that might make

the patent invalid, but the underlying fact of prior public

use or sale (Patent Act, section 102(b), 35 U.S.C. sec.

102-b).

In December of 1956 Petitioner, by its counsel, wrote

Respondent claiming that Respondent’s patent was invalid

by reason of prior public use and Respondent by its counsel,

of course, denied any duty to investigate the question for

the benefit of Petitioner (DA 67). Then as now the alleged

invalidity was not dependent upon fraud, but upon the

factual question of prior public use or sale. Then as now,

if the patent were invalid and if, as asserted, Respondent’s

patent interfered with or injured Petitioner in any manner

whatever, Petitioner was perfectly free to manufacture a

device that would infringe or involve contributory infringe-

ment (and to set up invalidity as a defense if Respondent

should sue) or to seek a declaratory a if Respond-

ent complained of infringement.*

However, to claim many years later, as in the instant

suit, by way of defense and counterclaim that the possible

invalidity, as such and without more, creates a wholly new

and separate action for violation of the federal antitrust

laws is specious. On such a theory any patentee whose

patent is held invalid has violated the antitrust laws. The

alleged invalidity then, and not the reason for the in-

validity, is what Petitioner really claims creates a treble

damage action under the antitrust laws. Stripped to its

gravamen the argument means that any active claim of

patent which turns out to be invalid is a violation of the

federal antitrust laws.

It is telling to note, too, that Petitioner does not provide

the court with the slightest suggestion of any distinction

between “a monopoly represented by a fraudulently ob-

tained patent” and “a monopoly represented by an invalid

patent.” Petitioner’s argument is equally applicable to

both and, as thus revealed, is completely untenable. Ac-

cordingly, not only is it of no public importance that

Petitioner’s claim of remedy be sustained but, on the con-

trary, if there is anything of importance involved, it is

important that no such remedy be created.

*The evidence in the record shows that Petitioner itself

was manufacturing and selling similar devices for raising

diffusing means from an aeration tank—single pivot swing

risers and hoists for swing risers (PA 4).

2. There is No Conflict Whatever between the Decision of

the Court of Appeals and this Court’s. Decision in Shaw.

kee Mfg. Co. v. Hartford-Empire Co.

Petitioner’s effort to place the decision of the Court of

Appeals in conflict with the decision in Shawkee Mfg. Co.

v. Hartford-Empire Co., 322 US. 271 is equally untenable.

Instead of reviewing the holdings in that and related

cases, Petitioner is satisfied to suggest that the case means

that a right to damages on some theory exists (PTN 9).

This court’s decision in the underlying case of Hazel

Atlas Glass Co. v. Hartford-Empire Co., 322 U.S. 238 in-

volved only the power of the Court of Appeals to vacate

its own judgment where the judgment was procured by

fraud. The issue was the same in Shawkee Mfg. Co. v. Hart-

ford-Empire Co., 322 U.S. 271, and there is nothing in the

decision suggesting that a third party has a private action

for damages against a patentee by reason of the patentee’s

procurement of its patent by fraud. Petitioner’s miscon-

ception that damages by reason of “fraudulent procure-

ment of a patent” were allowed in the litigation probably

stems from the proceedings following the Supreme Court

decision in the Hazel Atlas Glass Co. case, as reflected in

Hartford-Empire Co. v. Shawkee Mfg. Co., 163 F. 2d 474

(CA 3). Damages were not allowed for such purpose; the

Court of Appeals held that the fraudulently obtained in-

junction had forced several parties to renew their royalty

contracts with Hartford-Empire, and that they were thus

entitled to restitution of the amounts paid. All claims for

loss of profits or compensatory damages were rejected as

speculative. The court, however, indicated that, in view of

the “whole wretched scheme” punitive damage would be

allowed.

Petitioner would have the court overlook the material

differences between the Hartford-Empire litigation and the

pie ee

instant case. (i) The actions permitted in Hartford-Empire

arose from fraudulent procurement of a judgment—not

from “fraud on the Patent Office”; there is no suggestion

whatever that “fraud on the Patent Office,” without more,

was considered to be actionable by a private party or to be

a violation of the federal antitrust laws. (ii) The parties to

whom punitive damages were allowed had been directly

defrauded by Hartford-Empire in the course of litigation

institated by Hartford-Empire for the express purpose of

defrauding such parties and affecting their pecuniary and

property rights, which cireumstances, of course, afford a

eause of action; pointedly, in the instant case, there is no

allegation that Respondent defrauded Petitioner, but only

that Respondent defrauded the Patent Office.

As revealed at page 9 of its petition, Petitioner is not

making use of the Hartford-Empire litigation to argue

genuinely a conflict of results between Circuits, but to

plaintively suggest to this Court, as it did to the Court

of Appeals, that although Petitioner can find no theory

upon which it is entitled to relief (other than its antitrust

theory), this Court should supply it with a theory.

3. The Question of Affirmative Relief by a Third Party

Allegedly Injured by Another Party’s Fraudulent Pro-

curement of a Patent has Long Ago Been Settled by

this Court.

Petitioner (PTN 9) reads the Court of Appeal’s observa-

tions that Walker [Petitioner] cites no authority in support

of its theory to mean that the Court of Appeals regarded

the purported issue as open. No such reading is possible.

The Court of Appeals correctly relied upon established au-

thority in denying an affirmative cause of action to Peti-

tioner.

The cases are uniform in holding that the United States,

but no other party, may sue to revoke or set aside a patent

Se

procured through “fraud on the Patent Office.” United

States v. American Bell Telephone Co., 128 U.S. 315, 373;

Eckert v. Braun, 155 F. 2d 517, 519 (CA 7); United Mfg.

Service Co. v. Holwin Corp., 13 F.B.D. 510 (D.C.N.D., IL)

The Patent Office itself is not empowered to revoke a

patent once issued, whether on the ground of fraudulent

procurement or for any other reason. Minnesota Miming é

Manufacturing Co. v. Coe, 145 F. 2d 25 (App. D.C.), cert.

den. 323 U.S. 799.

The origins of the doctrine that only the United States

may sue to revoke or annul a patent are found in Mowry v.

Whitney, 81 U.S. (14 Wall.) 434, a case decided by this

Court in 1871. The Court held that, in the absence of a per-

missive proviso in the then current Patent Act, a private

party was without standing to seek annulment of another

party’s patent because of alleged fraud on the Patent Office.

The only question remaining after Mowry v. Whitney was

whether the United States had standing to sue for annul-

ment of a patent under such circumstances and this ques-

tion was resolved affirmatively in the Bell Telephone case

cited above, 128 U.S. 315, 373.

Accordingly, as clearly understood by both the District

Court and the Court of Appeals, a private damage claim

for alleged fraudulent procurement of a patent is a col-

lateral attack on the validity of the patent, viz, an attempt

to nullify it or, in effect, to cancel it. Such an attack may

not be made by a private claimant seeking affirmative re-

lief.

on

4 Obtaining of a Patent by Fraud on the Patent Office is

a More, a Violation of the Federal Anti-

ws.

Petitioner seriously argues (PTN 11, 12) that since “the

practice of fraud on the Patent Office, or at least the charge

thereof, is not of infrequent occurrence” ergo this court

should deem “such practice” to be a violation of the anti-

trust laws. Although the “frequency” of the practice is, of

course, doubtful, whether or not any provision of the fede-

ral antitrust laws is per se violated in such circumstances

is an entirely different matter.

In all the many pleadings and briefs filed to date by

Petitioner it has not, until its statement of Question No. 2.

(PTN 2), revealed what provisions of the federal antitrust

laws it deems applicable. Question No. 2., however, now

clearly asks for an adjudication that fraud on the Patent

Office in the procurement of a patent is per se a violation of

Section 2 of the Sherman Act.

Assuming, however, that procurement of a patent by

fraud on the Patent Office may constitute “unclean hands”

or “patent misuse,” and assuming that some instances of

“gnclean hands” or “patent misuse” amount to violations

of the antitrust laws, it does not follow that every instance

of unclean hands or of patent misuse or of claimed patent

abuse is a violation of the federal antitrust laws. Compare

Morton Salt Co. v. Suppiger, 314 U.S. 488, 490, 492; Trans-

parent Wrap Machine Corp. v. Stokes & Smith Company,

329 U.S. 637, 641; United States Gypsum Co. v. National

Gypsum Co., 352 U.S. 457, 465.

The logical relation of patent misuse to antitrust viola-

tions is summed up in the Report of the Attorney General’s

National Committee to Study the Antitrust Laws (1955),

page 254. The Committee said:

i le cen

“We reject the view that any violation of patent law

necessarily violates the antitrust laws. From some -

abuses of patent policy may flow consequences not

drastic enough to meet antitrust prerequisites of effect

on competition. In addition, many patent abuses are

more effectively curbed by simply denying equitable

relief as a matter of patent policy. Holding every pat-

ent law transgression to be at the same time an anti-

trust violation would, moreover, put the patent owner

on a different footing than owners of other property

subject to antitrust. For antitrust has its own measure

of permissive and wrongful conduct. To say that action

beyond the borders of the patent grant is a per se

antitrust violation is to ignore the Supreme Court’s

distinctions between the variant statutory standards

of the Sherman, Federal Trade Commission and Clay-

ton Acts as well as to repudiate the body of interpre-

tations distinguishing between offenses unreasonable

per se and those not.”

In sum, Petitioner cannot by the simple device of labeling

its claim an antitrust action “bootstrap” its now moot de-

fense of unenforceability of the patent into a treble damage

suit under the federal antitrust laws.

Over the years this Court has given elaborate and careful

attention to the question of illegality per se under the

Sherman Act. Certain practices, by their very nature, have

been held to be so unduly restrictive that they are to be

deemed illegal per se and any inquiry into their reason-

ableness is foreclosed. These practices are price fixing

(United States v. Socony-Vacwwm Oil Co., 310 U.S. 150,

210) ; division of markets (United States v. Addyston Pipe

& Steel Co., 85 Fed. 271, aff’d. 175 U.S. 211); group boy-

cotts (Fashion Originators’ Guild v. F.T.C., 312 U.S. 457) ;

and tying arrangements (Northern Pacific Railway Co. v.

United States, 356 U.S. 1).

iil tis

With these exceptions, for a practice to violate either

section 1 or 2 of the Sherman Act it must be condemned as

unduly or unreasonably restrictive. Standard Oil Co. of

New Jersey v. United States, 221 US. 1.

Finally, Petitioner has sought to generate confusion

throughout the proceedings by equating the special privi-

lege granted to an inventor with a monopoly consummated

by a successful trade predator. These two concepts denote

entirely different economic realities and are hardly coex-

tensive for all purposes. See for example, United States v.

Dubilier Condenser Corporation, 289 U.S. 178, 186. See

also Report of the Attorney General’s National Committee

to Study the Antitrust Laws (p. 14 hereof).

5. The Stricken Pleading Does Not Set Forth a Claim for

Relief Based Upon an Unreasonable Restraint of Trade

under the Sherman Act.

Unless a practice is illegal per se, in order to determine

whether it is unlawful under either section 1 or section 2 of

the Sherman Act it is first necessary to describe, define or

delineate the relevant market area. Brown Shoe Company

v. United States, 370 U.S. 294, 325 and cases cited therein;

Umited States v. E. I. duPont deNemours & Co., 353 U.S.

586, 593.

Not only does the stricken second amended counterclaim

fail to suggest a relevant market area, but it is also lack-

ing in appropriate allegations of subject-matter juris-

diction. Federal regulation of commerce stems from the

constitutional power to regulate interstate and foreign com-

merce. Nowhere does the pleading set forth an intelligible

description of business practices or transactions in some

way involving, relating to, or affecting any line or area of

interstate or foreign commerce.

nil sem

Cameron Iron Works, Inc. v. Edward Valves, Inc., 175

F. Supp. 423 (D.C. Tex.) is a pointed example of applica.

tion of the relevant market requirement in a case similar

to this case. In that case plaintiff sued to enforce its patent

covering certain improvements in valves for controlling

the flow of abrasive-laden fluids. ‘Defendant relied on the

usual patent defenses and filed a counterclaim charging

plaintiff with attempting to monopolize the market in

valves “sized especially for mudline service and having re-

silient sealing surfaces which render them capable of effec-

tively controlling the flow of abrasive-laden fluids circulated

in the mud supply system of drilling oil wells.” The court

found, however, that the evidence failed to show that any

separate market existed in valves with resilient sealing

surfaces for mudline service but rather that such valves in

fact competed with valves having metal to metal seals.

Unlike the instant case, the Cameron counterclaim at

least attempted to define the market area in which trade

was allegedly monopolized. Cameron illustrates, however,

that not every device or product — a market area

in and of itself.

6. The Question of Attorneys’ Fees does not Justify Re-

view by this Court.

The District Court observed, “[w]Je do not have admitted

or adjudicated fraud vitiating the validity of the patent.”

The Court of Appeals observed that “[t]he District Court

analyzed Walker’s case and the applicable law when ruling

on Walker’s motion for fees. This analysis obviates the

idea of arbitrariness.” A District Court’s exercise of dis-

cretion in granting or denying attorneys’ fees is hardly a

proper cause for exercise of this Court’s certiorari juris-

diction.

—17—

CONCLUSION

The petition for writ of certiorari should be denied.

Respectfully submitted,

Sueipon O. Cotten

208 South LaSalle Street

Chicago, Illinois

R. Howarp GoipsmiTra

CuHaries W. Ryan

Prudential Plaza

Chicago, Illinois

Attorneys for Respondent

Dresstar, GoLpsMITH, CLEMENT,

Gospor & Lapp

Prudential Plaza

Chicago, Illinois

FarmpMan, Koven, Sauzman,

Kognicsserc, Specks & Homzr

208 South LaSalle Street

Chicago, )llinois

Of Counsel