Petition for Writ of Certiorari — Maurice A. Garbell, Inc. v. Consolidated Vultee Aircraft Corp.

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Iu the Supreme Cr

OF THE

Anited States

OctoBER TERM, 1953

No. 30 1

Maurice A. GARBELL, INc., a corporation,

and GARBELL RESEARCH FOUNDATION, a

corporation,

Petitioners,

vs.

CoNSsOLIDATED VULTEE ArrcraFr CoRPORA-

TION, a corporation, and AMERICAN AIR-

LINEs, INc., a corporation,

Respondents.

PETITION FOR WRIT OF CERTIORARI

to the United States Court of Appeals

for the Ninth Circuit

and

BRIEF IN SUPPORT OF PETITION

FOR WRIT OF CERTIORARI.

Txueropore H. RocHe,

2000 Mills Tower, San Francisco 4, California, .

Counsel for Petitioners.

TxeEo. J. RocHE,

Sutiivan, Rocke, JoHNsON & FARRAHER,

2000 Mills Tower, San Francisco 4, California,

Of Counsel.

Subject Index

Page

Petition for writ of certiorari. ............ cece cee cece eee 1

RMI, oo ck ae nok vaN b N45 Fee e ca) Who eee en ees aes 2

SUPINE oc ves Menencae ns Does Dance Bias <i 15

Questions presented dig odigeee pn web dine eeh cd eens becess e< a0

Reasons for allowance of writ...... ee ee Pee 16

Conclusion. .«. ss e00% Spc bROEVETE WON RENE ine Wee eese 19

Brief in support of petition for writ of certiorari........... 21

I. Opinions of the courts below.............-seeeeeeees 21

BT: : Fee aS is is ny Gs ic eds tice sexes 22

TEE. . Septem i ones ca nbacndhd pas enes seen Cea erageneds 22

IV. Specification of erTors.. .....cseccescecceersececcees 22

V. . The legal Sagat... v.56 +>. 0010' 0 cin 00 a dip nasiat oma & sake» 23

GI. TRO IAW 5 cccccciccieecrcnveuesbeee s4 00s dN EES scree 24

1. i tiding $6 gt 960 diiglined on appeal unless

<‘elonshy qrrOmedas’ Te Se Fs cies aes 25

2. A finding supported by uncontradicted testimony

or all of the evidence on the subject cannot be

‘‘elearly erroneous”’ .......+..+.. OES eviesees 26

8. The shop-right rule ................ ph NE er 27

4, Reduction to practice rule...........-s..se0e> . 8

VII. The evidence ......... Se ee RES Da Nb ics ape dh 30

A. The evidence as to shop right....-.........+. eet ae

1. The invention here involved was devised and

St wicca otraadinre. ot

ment by Consolidated ............-- 30

2. hiaid slate Gaia We patenting ot

said invention by Consolidated during Gar-*

bell’s employment by it . eas RE neta heres 31

(a) The invention ..............50.008: sas oe

(b) No development or change.............. 81

Sussect Lypex

There was no reduction to practice of said

invention by Consolidated during its employ-

ment of Garbell of which he had notice or

knowledge .......-scsseceereccereceeeeses

(b) Model types .........---ceeeeeeeeeeees

(d). The XB-A46 ....... cece ec eee reece tees

(e) The Model 110 ..........seeeeeeeeeeees

(£) Garbell reduced invention to practice be-

fore employment ......-..---seeseeeees

The employer’s cost question..............-:

Inventor did not assent to or acquiesce in

use of invention by employer............---

B. The evidence on the invention agreement as it per-

tains to shop right............sseeeeeeeeeeeress

The invention agreement did not operate upon

or in any way affect the invention involved

No disclosure was made by Garbell to Consoli-

dated of said invention under the terms and

provisions of said invention agreement.......

(a) Garbell’s knowledge of patent procedure

of Consolidated ..........60--eeeeeeees

(b) Disclosures made by Garbell to Patent

Department ..... 6s ceseeceeeneeeeeees

i nes ioe canes 8

(d) Matther Gaskell nec Comelideted eonid-

ered the paper to be a ‘‘disclosure’’ under

Xp to Oomaolidated: 005. scecseeeseees

VEIT. Conclusion... .cscccctccceeceesererececenereencesens

Table of Authorities Cited

Adamson v. Gilliland, 242 U.S. 350, 37 S. Ct. 169.......... 25

Chesapeake & Ohio Railway Co. v. Martin, 283 U.S. 209, 51

8 Cbs OBS. . aoiccnkad inch» awrite aks ere pews same 26

Curtiss Aeroplane & Motor Corp. v. Janin (0.C.A, 2), 278

Fed. 454 ..... spk bE oo ALAR EAE ee 11, 44

Davis v. Schwartz, 155 U.S. 631, 15 S. Ct, 237............. 25

Ferree (E. H.) Co. v. United Shoe Machinery Corp., 290 U.S.

Gh4, 54 SB. Ot, OB. Oa EE ieee 26

Foran v. Commissioner (C.C.A. 5), 165 Fed. (2d) 705..... 27

Garbell v. Consolidated Vultee Aircraft Corp., 94 Fed. Supp

| NR RE ert AE NCE MARNE Dele AE PEN SIAR IEEE EE ea tr aMEs 2, 3, 22

Gill v. United States, 160 U.S. 426, 16 S. Ct. 322. ...... 18, 27, 28

Grace Bros. v. Commissioner (C.C.A. 9), 173 Fed. (2d) 170 27

Heywood-Wakefield Co. v. Small (C.C.A. 1), 87 Fed. (2d)

716 (cert. den. 301 U.S. 698) ...... 6. eee e eee eee eeeeee 28, 36

Massie v. Fruit Growers Express Co., 31 Fed. (2d) 463.... 36

San Francisco Assn. for Blind v. Industrial Aid for the

Blind (C.C.A. 8), 152 Fed. (2d) 582..........-00-eeee 27

Solomons y. United States, 137 U.S. 342, 11 S. Ct. 88....... 18, 27

United States v. Dubilier Coennr Corp., 289 U.S. 178, 53

Sh Ce BOE EE AS ie tie eb 18, 28

United States v. Oregon State Medical Society, 343 U.S. 326,

TD BCE BOO. sins sin np Sica Rise ttie Se meat Series vce sees 16, 26

United States v. United States Gypsum Company, 333 U.S.

364, 68 S. Ct. 525 .....--. eee ene Pi chnes cpedesenes ed 16, 17, 26

28 U.8.0.: Statutes

Section 1254(1) ....... vepsengasesbrnutecteenssnses <a

iv TaBLE or AUTHORITIES CITED

Section 1294 ...... Lak ah Ps ebda Chaat TSE 8 Bo Ree

Section 1BBS(a) .....cncsvcccncrccccvcconvenceecess

28 U.S.C.A., Section 2101(¢) .....eessereeeeereenees ewes

Texta

**1951 Ed. Robertson & Kirkham, Jurisdiction of the Su-

preme Court of the United States’’ by Wolfson & Kurland,

' Rules

In the Supreme Court

OF THE

Yuited States

OutToBER TERM, 1953

No.

Mavricr A. GaRBELL, INC., a corporation, |

and GARBELL RESEARCH FOUNDATION, a

corporation,

Petitioners,

bs, :

CONSOLIDATED VULTEE AIRCRAFT CoRPORA-

TION, a corporation, and AMERICAN AIR-

LINES, INC., a corporation,

Respondents.

PETITION FOR WRIT OF CERTIORARI

to the United States Court of Appeals

for the Ninth Circuit.

To the Honorable <»d M. Vinson, Chief Justice of

the United States, and to the Honorable Associate

Justices of the Supreme Court of the United

States:. .

Maurice A. Garbell, Inc., a corporation, and Gar-

bell Research soundation, a corporation, petitioners,

respectfully pray that a writ of certiorari issue to

review the judgment of the United States Court of

Appeals for the Ninth Cireuit entered in the above-

entitled case on June 9, 1953 (R. 1148) which re-

versed the judgment of the United States District

Court for the Southern District of California, Central

Division, (R. 58; 94 Fed. Supp. 843) holding that

claims 1, 2, 3, 5, 6 and 12 of patent No. 2,441,758

were valid and infringed by respondents herein, en-

joined further infringement thereof, and ordered an

accounting of profits and damages.

STATEMENT.

At the very outset, petitioners wish to advise the

Court that, while this action was brought to recover

damages for the infringement of a patent, the issues

of infringement and validity are not presently in-

volved. The only issue relates to the existence or

non-existence of a so-called shop right or implied

license; and it is in connection therewith that peti-

tioners counted that the Court of Apveals clearly

exceeded its proper scope of review.

Petitioners herein are the assignees of one Maurice

A. Garbell, who invented the subject-matter of United

States Patent No. 2,441,758, issued to him on May 18,

1948. Respondent Consolidated Vultee Aircraft Cor-

poration (hereinafter referred to as Consolidated)

is, and for, many years has been, engaged in the de-

velopment, “design and manufacture of commercial

and mae aircraft, Respondent American Ala

Ine. is, and for many years has been, engaged in the

commercial operations of aircraft for passenger “a

freight transportation.

Consolidated was charged with infringement as the

maker of the aircraft wing used on its Model 240

“‘Convair’’ airplane, and American Airlines, Inc. was

eharged with infringement as the user of such air-

craft, having purchased the same from Consolidated.

To the action, respondents herein interposed the

defenses of non-infringement, invalidity, shop right

and implied license. After a trial before it, the Dis-

trict Court rendered its decision in favor of peti-

tioners herein on all issues, making special findings

thereon, as hereinabove stated (R. 37; 94 Fed. Supp.

843). Respondents herein appealed to the United

States Court of Appeals for the Ninth Cireuit (R.

134), the cause being argued and submitted May 16,

1952, before Circuit Judges Mathews, Healy and

Bone. On June 9, 1953, the Court of Appeals issued

its opinion reversing the lower Court on the issues

of shop right and implied license only, stating:

‘In view of the conclusions stated above, we

need not and do not consider the other defenses

pleaded by appellants.” (R. 1148).

Thereafter, on July 8, 1953, petitioners herein anip

filed a petition for rehearing with said Court of Ap-

peals, which petition was denied on July 13, 1953

(R. 1149),

From the language tes from the opinion of the

Court of Appeals and hereinabove quoted, it is ap-

parent that the only question presented to this Court

involves the issues of shop right and implied license.

The patent stands as being valid and as being in-

fringed by respondents herein.

In order to reach the conclusion which it did, it

was necessary for the Court of Appeals to hold that

the special findings of the trial Court as to the non-

existence of a shop right or implied license were not

supported by the evidence and were clearly erroneous.

Petitioners contend that the entire evidence supports

the special findings of the trial Court, and that there

is no evidence whatever to support the conclusion

reached by the Court of Appeals, and that, therefore,

the decision of the Court of Appeals constitutes an

abuse of diseretion (Rule 52(a) of the Federal Rules

of Civil Procedure).

To resolve the question involved, turning as it does

entirely upon fact, necessitates a review of the evi-

dence, limited, however, to that portion of the evi-

dence which in any way pertains to the questions of

shop right or implied license.

It is to be noted that a major portion of the deci-

sion of the trial Court was given over to a discussion

of these two issues (R. 39-43).

Although the patent is not involved ‘ierein, some

understanding of the operation of the invention is

desirable, for the reason that it will then become

apparent to this Court that the evidence does not

give support to respondents’ claims of maids right or

implied license.

Simply stated, the invention calls for the constriie-

tion of a lifting surface (airplane wing) having three

or more sections, by the employment of airfoils se-

lected according to the method explained in the pat-

ent, and thus achieving excellent and improved

stalling characteristics. In other words, the Garbell

wing is not as prone to lose its lifting power (a stall)

as wings of any other type in use under similar con-

ditions, and the Garbell wing affords a ready and

complete RECOVERY to normal flight from a stall,

where other types of wings lead the aircraft into a

dangerous loss of altitude.

In an airplane wing, certain cross-sectional goo-

metric shapes, called airfoils, are used to produce lift

by that wing (R. 166-168). The lift is produced pri-

marily by accelerating the flow of air over the upper

surface of the wing in relation to the average speed

of the wing through the surrounding air. A change

in the flow of air over the upper surface of the wing

can be obtained by using various selections of air-

foils, which result in a change in configuration of the

wing itself.

In order to have anyone skilled in the art construct

a wing in accordance with the invention, it was only

necessary for the inventor to give him three airfoil

numbers, denoting the selection of the airfoil family,

and to designate the points at which they were to be

used (R. 279). The airfoils are designated by well-

known NACA numbers, and the interpolation of

these from one section of the wing to the next is

purely a matter of computation, well understood and

known to anyone skilled in the art. —

Thus, in order to practice the invention, it was

only necessary to construct an airplane having such

a wing and fly it. No development and no perfecting

and no ‘‘trying’’ were necessary.

Maurice A. Garbell (hereinafter referred to as

Garbell) entered the employ of Consolidated on Sep-

tember 7, 1942, being placed initially in Preliminary

Design. He was not employed to invent. (R. 445-6).

At the time of his said employment, Garbell was

requested to and did execute a form of Invention

Agreement (R. 633), the pertinent portions of which

are set forth in the opinion of the Court of Appeals

(R. 1141-3). Said agreement required Garbell to dis-

close promptly in writing to Consolidated’s Patent

Department, or to such person as Consolidated might

designate, all inventions and improvements thereto-

fore or thereafter made, developed, perfected, devised

or conceived by Garbell during Garbell’s employment

by Consolidated and including a period of one year

after termination of employment. The inventions

covered were those which related in any way to avia-

tion or to the business, developments or products of

Consolidated. The agreement outlined a procedure

which, if followed, would enable Consolidated to ac-

quire an interest in the invention. In so far as shop

right is concerned, said agreement contained the fol-

lowing paragraph:

“6. If [Consolidated] shall fail to elect. in

- writing that it desires to prosecute a patent ap-

plication on any invention or improvement speci-

fied in paragraph 1 hereof within nine months

_, following disclosure thereof to [Consolidated],

: then all rights. of Leena in and to such

invention or improvement shall revert to [Gar-

bell] with the exception only that [Consolidated]

shall have a free shop right with respect thereto.’’

Obviously, then, unless an invention had been made,

developed, perfected, devised or conceived by Garbell

during employment and had been disclosed to Con-

solidated under the so-called Invention Agreement,

there was no way by which Consolidated could have

obtained a shop right under the agreement itself. If

there were no rights obtained by Consolidated under

the agreement itself, in order to obtain an equitable

right by way of implied license it was necessary

for Consolidated to establish the existence of those

elements of the implied license rule, that is, when

the employee (1) conceives or devises some process,

method or instrument; (2) uses or causes to be used

the property and other employees of his employer

to develop, perfect or make or put into practicable

form his invention; and (3) assents to or acquiesces

in the use by the employer of such invention.

The only matter open for decision at this point is

whether or not Garbell’s invention was made, de-

veloped or perfected during employment. The trial

Court found that said invention was devised and

conceived by Garbell prior to his employment, which

finding the Court of Appeals found to be supported

by the evidence and, therefore, accepted said finding

as correct. (R. 1146).

Shortly after the date of his employment by Con-

solidated, Garbell suggested to his employer the use of

his‘invention. (R. 446). This procedure was followed by

him upon many occasions until his employment termi-

nated on October 15, 1945. Each and every of said

proposals were turned down by Consolidated (R. 234-

237; 261; 278-279; 301-302; 313-314; 324-326; 362;

461; 40-43). At no time did Consolidated offer to

use the invention, and at no time did the corporation

use the invention until long after Garbell had left

its employment, and then such use was without his

knowledge or consent (R. 236-237; 249; 255-257; 326;

418; 457-459).

Garbell was thoroughly familiar with the proce-

dure to be followed in order to disclose an invention

to Consolidated under the Invention Agreement, and

he was entirely familiar with the steps which were

taken by Consolidated under said Invention Agree-

ment following the disclosure of an invention by an

employee. During the course of his employment,

seven inventions made by Garbell were submitted to

Consolidated under the Invention Agreement, some

of which were accepted and some of which were re-

jected by Consolidated (R. 283; 351; 353; 316-322;

447-448).

Inasmuch as the evidence in this case demonstrates

that the invention of Garbell was never made, de-

veloped or perfected during the time of his employ-

ment by Consolidated, it would not be, and was not,

possible for Consolidated to obtain an express shop

right under the Invention Agreement relating to the

nse of said invention. This statement is likewise true

for the additional reason that there never was a dis-

closure of the invention by Garbell to Consolidated

under the Invention Agreement or within its terms

and provisions.

No implied license could be, nor was it, obtained

by Consolidated for the reason that Garbell’s inven-

tion was not made, developed, perfected, devised or

conceived by Garbell during employment.

In the decision rendered by the Court of Appeals,

there is no definite holding that Garbell made, de-

veloped or perfected his invention during his employ-

ment. Repeatedly said Court uses the language:

‘‘The evidence showed that, if Garbell ever made, de-

veloped or perfected his invention he did so during

his employment by Consolidated”. This is an as-

sumption by the Court without basis, for there is

no evidence that said invention was ever made, de-

veloped or perfected by and through the use of mate-

rials or facilities of Consolidated or time for which

Garbell was paid by Consolidated.

The Court of Appeals assumed that solely because

Consolidated, upon a few occasions during the period

of Garbell’s employment, had caused certain wing

models to be made for its own purposes and which

did embrace the features of the Garbell invention,

that this constituted either a making, a developing

or a perfecting of said invention, or a reduction to

practice. Such an assumption is not correct and can-

not find support in the evidence.

The character of this invention has heretofore been

stated (supra, p. 4), and it is obvious that said in-

vention is not one which calls for a process or a

machine or a design. Inventions of the type last men-

tioned usually need work and trial-and-error methods,

models need te be made, and so the development or

perfecting of the invention progresses step by step.

The uncontroverted fact is that the invention as

ultimately used by Consolidated after Garbell had

terminated his employment with Consolidated, was

unchanged from the first suggestion for its use as

made by Garbell several years before and shortly

after his employment by Consolidated on September

7,.1942. Respondents herein introduced no evidence

whatsoever which even tended to show that during

Garbell’s.employment the invention was changed, de-

veloped or perfected. The only testimony in the

record on the subject was introduced by petitioners

positively stating that there was no change in the

invention by anything that was done during the

period of employment of Garbell (R. 461-462).

Reference has been made to models constructed by

Consolidated which embodied the invention. The un-

controverted evidence is to the effect that no model

contained all of the elements of the invention and

fully operated so that the teaching of the invention

could be demonstrated. Thus, there was no use made

of the invention and it was not reduced to practicable

form, within the meaning of the authorities. To

reduce the invention to practice, a model would have

had to contain all the elements of the invention and

be a fully-gperating and free-flying model, so that the

operation of the invention could be fully and com-

pletely demonstrated. One of the basic elements of

the invention is that it enables an airplane using a

wing constructed in accordance with the teachings

of the invention to recover from a stall. Therefore,

freedom of movement and the availability of operat-

ing controls were vitally necessary to demonstrate

these basic elements. Such a model was never built

by Consolidated.

In some instances, more than one model was built

of a certain contemplated airplane. Many of these

models were fixed or static models and some were

free-flying. In every instance, however, the frae-flying

model did not make use of the Garbell invention.

Strangely enough, the testimony placed in the record

by petitioners herein and by respondents herein is in

full accord on this subject (R. 255-7, 300, 322-3, 454-6,

458-9). \

It is the contention of petitioners herein that the

invention here involved belongs to that category of

inventions complete in and of themselves, and that it

only takes the explanation thereof to anyone skilled

in the art to enable the invention to be reduced to

practice. This, of course, is the so-called constructive

reduction to practice rule; but the Courts, in certain

instances, have upheld the theory of constructive re-

duction to practice over a physical reduction to prac-

tice (Curtiss Aeroplane & Motor Corp. v. Janin

(C.C.A. 2), 278 Fed. 454, 456). A constructive redue-

tion to practice is sufficient to protect an inventor

against a claim of shop right. The evidence on this

subject stands alone and uncontradicted, and demon-

strates that long prior to Garbell’s employment by

Consolidated he explained his invention upon two dif-

ferent occasions to individuals who were well quali-

fied to and did fully understand said invention (R.

199-207).

The Court of Appeals apparently assumed, in reach-

ing the conclusion it did, that Consolidated had been

put to some cost or expense in connection with

Garbell’s invention, first in connection with the con-

struction of models, and, secondly, in connection with

Garbell’s salary. Not one word of evidence was

placed into the record by respondents as to. cost of

models. The only evidence in the record was intro-

duced by petitioners herein, which entirely negatives

any question of cost expenditure in connection with

the Garbell invention or its making, developing or

perfecting (R. 280-281, 454-5).

Garbell was under salary and his time was devoted

to his employer. However, there is no evidence what-

soever of his spending his employer’s time working

on his own prior invention. It was fully conceived

and devised when he entered Consolidated 's employ,

and is used in the accused device in its unchanged,

original form.

It must be presumed that if the testimony intro-

duced by petitioners herein was not in accordance

with actual fact, respondents herein would have intro-

duced evidence to the contrary upon the subject. As

* to most of the matters herein referred to, and to

which Garbell testified, he was not even cross-

examined by respondents,

It was not until on or about July 18, 1946, nine

or ten months after terminating his employment with

Consolidated, that Garbell learned that his former

employer was using his invention in the manufacture

of an airplane known as the Convair 240. On August

5, 1946 (R. 638), and on August 12, 1946 (R. 639),

Garbell wrote Consolidated and took immediate steps

to place his former employer upon notice (R. 217-

218). Garbell did not sleep on his rights and he did

not allow the user of the invention to proceed without

notice and expend further sums in construction. The

uncontradicted evidence is that respondents herein

never advanced a claim of shop right or implied li-

cense until after Consolidated had been put upon

notice, in August of 1946 (R. 236-7).

The Court of Appeals is likewise in error in taking

the position that Garbell made a disclosure of this

particular invention under the terms of the Invention

Agreement.

Both petitioners and respondents herein introduced

testimony that in December, 1944, Garbell was re-

quested by his employer, Consolidated, to prepare

a scientific paper for presentation to the Institute

of Aeronautical Sciences, and that it was suggested

to Garbell that he write about his wing (R. 289-90,

301). Such a paper was prepared and submitted to

the Institute (R. 775). Garbell also placed a copy of

said scientific paper in the hands of his employer,

with a letter, in order to protect himself patent-wise,

inasmuch as he realized that for the first time facts

concerning his invention were being released to the

general public. As has been pointed out, Garbell had

made many disclosures to Consolidated under the In-

vention Agreement and had followed the procedure

outlined therein. Such procedure was not followed

in the instance of the scientific paper, for he did not

consider it or intend it to be a disclosure under the

Invention Agreement. The paper was not sent to the

Patent Department as required in the Invention

Agreement.

Consolidated did not consider the receipt of the

scientific paper as a patent disclosure, and nothing.

was done by it with reference thereto during the bal-

ance of the time that Garbell was employed, which

was up to October 15, 1945. The records of Consoli-

dated show that said paper was not received by its

Patent Department until on or about January 24,

1946 (R. 354). No communication was ever sent to

Garbell, although Consolidated had Garbell’s then

address (R. 363, 365). When Garbell wrote to Con-

solidated on August 5, 1946, in order to place said

corporation upon notice that they were using his in-

vention, for which an application for Letters Patent

was then pending, Consolidated, in answering said

letter, requested that acopy of the patent application

be sent to it for the purpose of a disclosure, on the

basis that in so doing the disclosure would be made

to Consolidated without obligation (R. 641). Obvi-

ously, Consolidated was then, for the first time, asking

for an official disclosure and was not making any

claim of shop right or implied license.

JURISDICTION.

1. The jurisdiction of this Court to review the

judgment of the Court of Appeals is based upon Title

28, United States Code, Section 1254(1).

2. This petition is timely filed. The judgment

of the Court of Appeals was entered June 9, 1953

(R. 1148). Thereafter, and on July 8, 1953, petitioners

duly filed a petition for rehearing with said Court

of Appeals. Said petition was denied on July 13,

1953 (R. 1149). The application for a writ of certiorari

may be made within ninety days thereafter (28

U.S.C.A. 2101(c)).

3. The jurisdiction of the Court of Appeals is

based upon Title 28, United States Code, Sections

1291 and 1294. The jurisdiction of the District Court

is based upon Title 28, United States Code, Section

1338(a).

QUESTIONS PRESENTED.

1. Tne trial Court in this case made special find-

ings of fact based upon uncontradicted and unim-

peached evidence. Was it error for the Court of

Appeals to fail to give effect to such findings of fact?

2. The trial Court in this case made special find-

ings of fact based.upon the only evidence upon the

subject matter of said findings. Was it error for

the Court of Appeals to assume the existence of facts

to the contrary, although not justified by the record,

and thus fail to give effect to the special findings of

the trial Court?

3. The affirmative defense of shop right or implied

license was raised by defendants (respondents herein)

in the trial Court. The uncontroverted evidence dem-

onstrated the non-existence of those facts legally re-

quired to establish such defense. The trial Court

specially found that such defense was not established.

Was it error for the Court of Appeals to hold that

such findings were ‘‘clearly erroneous’’?

4. The Court of Appeals held that certain special

findings of the trial Court pertaining to the defense

of shop right and implied license were ‘‘clearly erro-

neous”. Did the evidence support the holding of the

Court of Appeals?

REASONS FOR ALLOWANCE OF WRIT.

The decision of the Court of Appeals in this case

constitutes an abuse of discretion involving a matter

of law, because:

Contrary to Rule 52(a) of the Federal Rules of

Civil Procedure, 28 U.S.C.A., and the decisions of this

Court, such as United States v. United States Gypsum

Company, 333 U.S. 364, 394, 68 S.Ct. 525; United,

States v. Oregon State Medical Society, 343 U.S. 326,

72 §.Ct. 690, said Court of Appeals held as being

“clearly erroneous’ certain special findings of the

trial Court. —

The special findings in question, pertaining to the

failure of defendants (respondents herein) to estab-

lish their Sis of shop right or implied or any

license were supported in one case by the entire evi-

dence which was, on these particular points, uncon-

tradicted. The record, even if considered in the light

most favorable to respondents, unquestionably shows

that the findings of the trial Court were supported

not only by substantial evidence, but by a clear pre-

ponderance of all the evidence.

In United States v. United States Gypsum Com-

pany, supra, this Court held that if a reviewing Court,

on the entire evidence, is left with the definite and

firm conviction that a mistake has been committed,

a finding is ‘‘clearly erroneous’’, although there is

evidence to support it. This statement is obviously

predicated upon the circumstance that there is evi-

dence other than that which supports the finding.

Thus, since in this case the only evidence supported

the trial Court’s findings, and there was no other evi-

dence to consider, said findings were not ‘“‘clearly

erroneous’’.

As to the claim of shop right, unless the evidence

reflects a full compliance with the terms of the Inven-

tion Agreement, hereinabove referred to, the claim

must fail. The undisputed evidence in this case dem-

onstrates that there never was a ‘‘disclosure’’ of the

invention in question within the meaning and terms

of said agreement, so that said agreement never be-

came operative, hence respondents could obtain or

have no rights thereunder.

This Court has repeatedly held that it is only in

those cases where an employee has: (1) invented;

(2) used his employer’s time and materials to perfect,

develop or reduce to practise said invention; and (3)

allowed his employer to use the invention without

making any claim for compensation, that an mene

license or shop right can arise.

Gill v. United States, 160 U.S. 426, 16 S.Ct.

322;

United States v. Dubilier Condenser Corp., 289

U.S. 178, 53 S.Ct. 554;

Solomons v. United States, 187 U.S, 342, 11

S.Ct. 88.

The undisputed record in this case demonstrates

that not only did respondents herein fail to establish

the existence of any of the elements of the so-called

shop-right rule, but, on the contrary, petitioners

herein conclusively established the nonexistence of

those elements.

Inasmuch as the record, without conflict, clearly

shows that the invention involved herein was not

‘made, developed or perfected” during Garbell’s

employment, there is no basis for the assumption to

the contrary made by the Court of Appeals and stated

in its opinion.

We submit, therefore, that the Court of Appeals

exceeded its proper scope of review in rendering its

decision hereinabove referred to, that said decision

constitutes an abuse of discretion and, if allowed to

stand, will result in a gross miscarriage of justice.

CONCLUSION.

For the foregoing reasons, it is respectfully sub-

mitted that this petition for a writ of certiorari to

review the decision of the Court of Appeals for the

Ninth Circuit should be granted.

Dated, San Francisco, “aliornia,

August 19, 1953.

THEODORE H. RocHE,

Counsel for Petitioners.

Maurice A. GARBELL, INC., a corporation,

and GARBELL RESEARCH FOUNDATION, a

corporation,

Petitioners,

Vs.

_ Consotmatep VutTer Arrorart CorPoRa-

— —s: TION, a corporation, and AMERICAN ArR-

LINEs, INC., a corporation,

Respondents. |

BRIEF IN SUPPORT OF PETITION

FOR WRIT OF CERTIORARI.

Be OPINION OF THE COURTS BELOW.

The judgment of the United States District Court

or the Southern District of California, Central Divi-

sion, in favor of petitioners herein was entered Jan-

wary 15, 1951 (R. 58-65). The District Court’s opin-

ion appears in the record (R. 37-57) and is reported

at 94 Fed. Supp. 843.

The opinion of the Court of Appeals below appears

in the record (R. 1140). The judgment of the Court

of Appeals was entered June 9, 1953 (R. 1148).

The petition for rehearing was duly filed with the

Court of Appeals on July 8, 1953, which said petition

was denied on July 13, 1953 (R. 1149).

II.

JURISDICTION.

The jurisdictional statement appears in the preced-

ing petition for writ of certiorari (supra, p. 15).

ITT.

STATEMENT.

The essential facts are stated in the preceding peti-

tion for writ of certiorari (supra, pp. 2 to 14), and

in the interests of brevity are not repeated here. Any

necessary elaboration of the evidence will be made in

the course of the argument which follows.

3 IV.

SPECIFICATION OF ERRORS.

1. “'Phe\ Court of Appeals erred in determining

that the special findings of the trial Court, to the

effect that defendants (respondents herein) had not

established the claim of shop right license nor estab-

lished the defense of an implied or any license, were

not supported by the evidence.

2. The Court of Appeals erred in holding, in

effect, that the invention of Garbell was made, de-

veloped and perfected during Garbell’s employment

by Consolidated.

3. The Court of Appeals erred, as a matter of

law, in holding that the findings of the trial Court

as they pertained to the special defenses of shop

right and implied license were “clearly erro’-eous’’.

4. The Court of Appeals erred in determining

that the invention was disclosed by Garbell to his

employer, Consolidated, under and within the terms

of the Invention Agreement.

5. The Court of Appeals erred, as a matter of

law, in holding that there was no evidence that Gar-

bell reduced his alleged invention to practice prior

to his employment by Consolidated.

THE LEGAL ISSUES.

The legal issues are not complicated. The special

defenses of shop right and implied license, in order

to be availed of, require the party to an action rely-

ing thereon to establish the existence of certain ele-

ments and, in the absence thereof, the special defenses

must fail.

Petitioners contend that the evidence introduced in

this case fails in every respect to support the special

defenses of shop right and implied license. Petition-

ers further contend that the entire evidence pertinent

to said special defenses positively establishes the

absence of any ground upon which such special de-

fenses might successfully be based. The record estab-

lishes the fact that the findings of the trial Court

were supported, not only by substantial evidence, but

by all of the evidence in most instances and a great

preponderance of the evidence in the remainder.

If the evidence establishes the fact that the inven-

tion of Garbell was not made, developed or perfected

during the time that he was employed by Consoli-

dated, the defenses of shop right and implied license

must fail and the conclusions reached by the Court

of Appeals are, hence, without foundation.

In addition to the ground just stated, the defense

of shop right under the Invention Agreement must

likewise fail, unless the evidence establishes that a

disclosure was made of the invention by Garbell to

his employer, Consolidated, under the Invention

Agreement.

VI.

THE LAW.

The law applicable to the issues herein set forth

is well established and not open to question.

Fp nn A ei NORMAL

1. A finding is not to be disregarded on appeal unless ‘‘clearly

erroneous’’. be

Rule 52(a), Federal Rules of Civil Procedure (28

U.S.C.A.) states:

‘‘Findings of fact shall not be set aside unless

clearly erroneous, and due regard shall be given

to the opportunity of the trial court to judge of

the credibility of the witnesses.”’

In the application of this rule, reviewing Courts

have emphasized the importance of the conclusions

of the trial judge which derive from his opportunity

to pass upon the credibility of the witnesses; and

they have declined to resolve a conflict on the testi-

mony of witnesses their own way.

See:

Davis v. Schwartz, 155 U.S. 631, 15 8. Ct. 237;

Adamson v. Gilliland, 242 U.S. 350, 37 S. Ct.

169,

The case last referred to, and which has been fre-

quently cited, contains this language:

‘‘* * * so far as the finding of the master or

judge who saw the witnesses ‘depends upon con-

flicting testimony or upon the credibility of wit-

nesses, or so far as there is any testimony con-

sistent with the finding, it must be treated as

unassailable.’ Davis v. Schwartz, 155 U.S. 631,

39 L. Ed. 289, 291.’’

Under the rule laid down in said Adamson case,

certiorari has issued where the Court of Appeals has

exceeded its proper scope of review by failing to give

effect to the facts found by the District Court.

$1951 Ed. Robertson & Kirkham, Jurisdiction

of the Supreme Court of the United States”, by

Wolfson & Kurland, p. 704, sec. 354, note 14,

citing :

E. H. Ferree Co. v. United Shoe Machines y

Corp., 290 U.S. 614, 54 8. Ct. 69.

The meaning of the phrase ‘‘clearly erroneous’’

has been defined by this Court in the case of

United States v. United States Gypsum Com-

pany, 333 U.S. 364, 394, 68 S. Ct. 525, 541,

where this language appears:

‘A finding is ‘clearly erroneous’ when although

there is evidence to support it, the reviewing

court on the entire evidence is left with a definite

and firm conviction that a mistake has been com-

mitted.”’

See, also,

United States v. Oregon State Medical Society,

343 U.S. 326, 72 S. Ct. 690.

From said definition, it is readily apparent that,

when the finding is supported by evidence, other evi-

dence must exist which is in conflict therewith before

such finding can be held to be ‘‘clearly erroneous’’.

2. A finding supported by uncontradicted testimony or all of

the evidence on the subject cannot be ‘‘clearly erroneous’.

It is axiomatic that uncontradicted testimony must

be followed.

Chesapeake & Ohio Railway Co. v. Martin, 283

U.S. 209, 216, 217, 51 S. Ct. 453;

|S. F. Association for Blind v. Industrial Aid

for the Blind (C.C.A. 8), 152 Fed. (2d) 532,

536 ;

Foran v. Commissioner (C.C.A. 5), 165 Fed.

(2d) 705;

Grace v. Commissioner (C.C.A. 9), 173 Fed.

(2d). 170.

The only exception to the rule occurs when the

Appellate Court is dealing with testimony given by

witnesses who stand impeached and whose testimony

is contradicted by the testimony of others or by physi-

cal or other facts actually proven or with testimony

which is inherently improbable.

Grace Bros. v. Commissioner (C.C.A. 9), 173

Fed. (2d) 170, and cases therein cited.

8. The shop-right rule.

The authorities universally hold that in the case

of employer and employee a shop right arises where

the employee:

(a) Conceives or devises some process, method or

instrument ;

(b) Uses and causes to be used the property and

other employees of his employer to develop, perfect

or make and put into practicable form his invention;

invention by the employer.

Gill v. United States, 160 U.S. 426, 16 S. Ct.

322 ;

Solomons v. United States, 137 U.S. 342, 11 S.

Ct. 88;

United States v. Dubilier Condenser Corp., 289

U.S. 178, 53 8. Ct. 554.

In discussing the shop-right rule, this Court said, in

Gill v. United States, 160 U.S. 426,

at page 430:

“The principle is really an application or out-

growth of the law of estoppel im pats, by which

a person looking on and assenting to that which

he has power to prevent is held to be precluded

ever afterwards from maintaining an action for

damages.”’

4. Reduction to Practice Rule.

The Court of Appeals, in the opinion rendered by

it, disagreed with the holding of the trial Court that

Garbell made, developed and perfected his alleged

invention when he devised and conceived it, saying:

‘‘An invention is not made, developed or per-

fected until reduced to practice.”’ (R. 1146.)

There is no question that this is the law in cases

of interference or infringement where the contest is

between two persons, each claiming to be the inventor

or the assignee thereof. However, it is not the law,

and has no application, in a case such as the one

now. before the Court, wherein the defendants (re-

spondents herein) are not seeking any title to or in-

terest in the invention or patent, but have merely

set up the defense of shop right or implied license.

Neg = 3

Heywood-Wakefield Co. v. Small (C.C.A. 1),

87\Fed. (24) 716 (Cert. Den. 301 U.S. 698).

In that case, an employee, during the time he was

employed, invented a reversible car seat. Upon show-

ing a cardboard model to his employer, the employer

ordered a full-scale seat to be made up. Subsequently,

the inventor obtained a patent and brought an action

against his former employer, which employer claimed

possession of a shop right as one of its defenses to

said action. Defendant contended, among other things,

that an invention must: be reduced to actual practice

before it is complete as a patentable invention, and,

therefore, the work of the defendant in proving that

the plaintiff’s idea was practical by building a full-

sized model was essential to the completion of the

invention, and cited a substantial number of authori-

ties in support of said proposition. The Court, in

holding the cited cases as not applicable, at page 719,

said:

‘The cases cited * * * are all cases involving

interference and priority.”’

After a discussion of one of said authorities, the

Court, at page 720, states the correct rule:

‘Where, however, the inventor applies for and

obtains a patent on his own draft and applica-

tion, his invention, if patentable, is considered

complete where no interference or prior right is

claimed, especially if one skilled in the art can

from his draft and description in the application

make the device, as it apparently was done in

this case, since the defendant made up and sold

car seat bases built according to the plaintiff’s so-

called cardboard and ‘cigar box model’,’’

VII.

THE EVIDENCE.

There but remains the examination of those perti-

nent portions of the record which will disclose upon

their face whether or not the findings of the trial

Court with relation to the questions of shop right

and implied license are supported by the evidence

so that it would constitute a reversible error to hold

that said findings are ‘‘clearly erroneous’’.

In the belief that by so doing we may lessen the

burden of this Court, we have quoted from the record

itself, so that this Court will not find it necessary

to refer to the record in every instance.

A. THE EVIDENCE AS TO SHOP RIGHT.

The evidence in this case discloses a factual situa-

tion which completely eliminates the shop-right theory

and demonstrates the absolute failure of respondents

to carry the burden, which was entirely theirs, of

proving the affirmative defense of shop right.

1. The invention here involved was devised and conceived by

Garbell prior to his employment by Consolidated.

This fact needs no discussion, as the trial Court

so found and the Court of Appeals concurred (R.

1146).

2. There was no development or perfecting of said invention by

Consolidated during Garbell’s employment by it.

(a) The invention.

The character of this invention has heretofore been

described (supra, pp. 45).

The undisputed fact is that no change, modification,

development, correction or perfectioning was in fact

made in the invention at any time after 1939, the

date when it was conceived and devised.

(b) No development or change.

It is inconceivable that respondents herein would

not have produced evidence of changes made or de-

velopment of the invention, if any there were. The

only testimony whatever on this subject was intro-

duced by petitioners, such testimony standing alone,

unchallenged, and uncontradicted. In testifying on

this subject of improvement, Garbell said:

“Q. Now, did any of these tests that have

been referred to, these wind tunnel sections or

these three-section wings, did they contribute in

any way toward improvement or alterations in

your invention or in perfecting it?

A. No; no, absolutely not. If this is a cri-

terion, there was no change from before to after.

Even the first suggestion was complete, contained

all the elements; nothing was modified.

The Court. In other words, it is your conten-

tion that you added nothing to the conception or

the practical carrying-out of the invention by

anything that you did during the employment

with the defendant?

The Witness. That is right.”’ (R. 461-462.)

Upon many occasions during his employment by

Consolidated Garbell suggested or proposed the use

of his invention in connection with some contemplated

work. In testifying on this subject, Garbell gave

evidence as follows:

“he Court. In other words, the conception

preceded the work with this company, is that

right ?

The Witness (Garbell). Yes.

The Court. What you were doing here was

not developed, but was merely suggesting that

they adopt the conception ?

The Witness. Yes.

The Court. A pre-existing conception.

The Witness. Yes. It was like stating—well,

one person suggercing a flat roof for a building,

and another one saying, ‘Let’s make it slope, so

that the rain water will run off.’’’ (R. 289.)

And again: .

‘The Court. What you mean to say, how-

ever, is that these were not the working out of

an idea, but merely putting the idea in writing

and saying, ‘That is my idea. Can you use it?’

The Witness. Yes.” (R. 281.)

Not one word of testimony on this subject was put

into the record by respondents, thus there is not even

a conflict in the evidence. By reason thereof, we feel

that the Court of Appeals was mistaken in believing

that development or perfecting of the invention took

place during Garbell’s employnient by Consolidated.

Throughout the record there is evidence of the fact

that during his employment by Consolidated Garbell

repeatedly proposed or suggested the use of a wing

falling within the meaning of his invention. These

‘‘proposals’’ were at the initial stage on any given

project and never reached the final design of the

airplane or wing then under consideration during Gar-

bell’s employment. The testimony above set forth

properly characterizes these proposals.

A mere suggestion, one among many, is of no im-

portance whatsoever on a shop-right claim. If the

idea had been incorporated in the final design for a

certain airplane, from which the airplane was to be

built, and the inventor knew of such incorporation,

he certainly would have been placed upon notice. Such

is not the case here,

In no single instance was Garbell’s invention ever

placed in final design during his employment and

with his knowledge. There is no evidence that it was

ever carried into final design while he was employed

by Consolidated.

The Court of Appeals may very easily have been

led into believing that Garbell aided in the prepara-

tion of final plans for one or more airplanes embody-

ing his invention by reason of the unfortunate choice

of words used by respondents’ counsel in his cross-

examination of Garbell. Repeatedly he kept using

the phrase “‘plans or design for an airplane’’ (R. 243-

254), when actually all he meant was preliminary

reports or proposals.

The confusion was eliminated by action of the trial

‘ Gourt as follows:

‘‘Mr, Frederick Lyon. Your Honor, please, I

wonder why we can’t have a definition of what he

means by the words ‘plans’ and ‘design’.

The Court. I understand what he means.

Mr. Frederick Lyon. The witness doesn’t seem

to.

The Court. He means preliminary work by

way of discussion.

Mr. Gerlach. “Yes.’’ (R. 252.)

And again:

“Q. (By Mr. Gerlach). And did you partici-

pate in making the plans for that aircraft, so far

as the airfoil is concerned ?

Mr. Frederick Lyon. May we have a defini-

tion of what he means by the word ‘plans’?

The Court. It is evident to the witness. Let

us go on from there.

Mr. Frederick Lyon. May we ask the witness

if the question is evident on that word?

The Court. He is answering. He understands

it. Go ahead. It means any step that was taken.

He doesn’t mean blueprints.

The Witness (Garbell). A suggestion proposal.

The Court. A suggestion or proposal; yes.”’

(R. 254.)

Respondents introduced several reports into evi-

dence which contained proposals by Garbell for the

use of his wing, such as defendants’ Exhibit B (R.

694; 258-9). In referring to these reports, Garbell was

asked whether it was a design for an airplane. This

answer was given:

“r¢

“A, No. It is a suggestion, of which usually

there are at least two or three or four, and the

plans of the airplane are eventually decided from

any of this number of preliminary suggestions.

Q. As far as the work of proposing the use of

your invention was concerned, what part of one

of these so-called proposals is that?

A. That is the smallest part.

Q. Actually, it is just a suggestion of using

three particular airfoils?

A. Yes.

Q. There is no mathematics, no computations

or anything else required to make such a pro-

posal, is there?

A. Very little. Well, usually I did them at

home, because it was the only place where it was

quiet.

Q. It is the same thing as if you proposed

to the purchasing department that they buy one

kind of an automobile over another kind, isn’t it?

A. Yes.’’ (R. 279-280.)

3. There was no reduction to practice of said invention by Con-

solidated during its employment of Garbell of which he had

notice or knowledge.

In order to have brought themselves within the

shop-right theory, it was encumbent upon respondents

to have proven the construction of the invention (re-

duction to practice) with the knowledge and consent

of the inventor and that such construction was made

in order to perfect, develop or use the invention. It

is not enough if such construction was for a demon-

strational test only, made by the employer for his

own information and knowledge, nor if such con-

struction did not fully and completely utilize the

invention.

See supra, pp. 28-29, for analysis of

Heywood-W akefield Co. v. Small (C.C.A. 1), 87

Fed. (2d) 716, 719 (cert. den. 301 U.S. 698),

and see, also:

Massie v. Fruit Growers Express Co., 31 Fed.

(2d) 463, 466.

(a) Models involved.

The Court of Appeals in reaching the conclusion ex-

pressed in its opinion, obviously assumed that some

of the models constructed and run through wind-tunnel

tests constituted a reduction to practice. Such an

assumption is not supported by the evidence.

At this point, an enumeration of the structures in-

volved would be helpful.

In point of time, but three aircraft proposals can or

do have any bearing on this case. They are, in the or-

der of their appearance: (1) The two-engine tailless ;

(2) the XB-46; and (3) the Model 110.

Garbell left the employ of Consolidated on October

15, 1945.

The two-engine tailless never went past the model

stage and was then abandoned, so models only are in-

volved...

One airplane of the XB-46 type was built and flown, |

admittedly after 1946, long after Garbell’s employ- —

ment had\terminated, so models only are involved. _ ¢

*, *, as 3 : rt

One airplane of the Model 110 was built and flown

subsequently to the XB-46, so for the same reason

models only are concerned.

The accused airplane, Convair 240, did not come

into the picture until after Garbell had left Consoli-

dated, so no part is played by it in the shop-right

theory.

(b) Model types.

The evidence in this case discloses that models were

made for testing in a wind tunnel, such tests to be for

diverse purposes; that some models were immovably

fixed to a base for static observation only, hence called

‘“statie’’; that some models were made so they could

be actually flown in the wind tunnel and thus truly be

‘“‘“completely operating model’’; that some were made

to test wings and some were made to test appendages,

such as nacelles, control systems, etc.

We submit that for a structure to fall within the

shop-right theory, it must contain all of the elements

of the invention and fully operate, so that the teach-

ings of the invention can be demonstrated, otherwise

there is no “‘use’’ made of the invention, and it is not

reduced to “‘practicable form’’ within the meaning of

the authorities. Therefore, only those free-flying, fully

operating models can be considered, for, obviously, it

is impossible to demonstrate and reduce to practice the

invention by using a model limited in scope, such as a

“‘statie’’ model. Freedom of movement and the avail-

ability of operating controls are vitally necessary to

demonstrate the RECOVERY of the aircraft from a

‘

stall, which recovery is afforded by the Garbell wing.

Such a model was never built by Consolidated.

The testimony of Garbell for petitioners and Bayless

for respondents is in full accord on this subject and

without conflict. As such testimony pertains to models,

it may be summarized as follows:

Three models were built.

The first was a static wind-tunnel model with a two-

section wing. (Not Garbell’s wing.)

The second was made for studies of the nacelles and

fuselages, wing-tip fins and the extensible front and

rear surfaces and flaps, all embraced within an inven-

tion by one Sutton, which invention Consolidated had

acquired. This model had a three-section wing (Gar-

bell’s), which was used in order to get some variation

from the first model, so that additional information

on all the auxiliary controls and appurtenances could

be obtained. (R. 454.) This was NOT an operating

free-flying model.

The third model was a free-flight model, which was

to be tested in the NACA free-flight wind tunnel.

This had a two-section wing. (Not Garbell’s wing.)

(R. 256-7, 454-6, Garbell ; R. 322-3, Bayless.)

From. the foregoing two things are apparent and

neither is any aid to the shop-right theory. First, no

operating model of the invention was made. Second,

Consolidated used the static model to test and develop

its own ideas on control surfaces and other appur-

tenances only; no tests were made to experiment with

the Garbell wing.

(d). The XB-46.

Although the defense of shop right is an affirmative

defense and the burden is on the defendant to prove

it, not upon the plaintiff to disprove it, respondents

introduced no testimony concerning models made. The

record shows nothing but an unqualified, bare state-

ment by respondents’ witness Bayless that Garbell

made his usual suggestion and it was incorporated.

The real facts were placed in the record by the pe-

titioners. Their testimony was in no way challenged.

The only model made by Consolidated was a static

wind-tunnel model which was made and used to test

other things on the model but not its wing, which

wing followed the Garbell suggestion. Following this

model, Consolidated built a full-scale mock-up which

incorporated a two-section wing. (Not Garbell’s wing.)

The true situation is readily grasped from the

following: :

‘‘Q. Now you heard Mr. Bayless testify that

there were wind tunnel models made for the

XB-46. What did he tell you concerning the

cost of these at the time they were made?

A. It was exactly the same thing again. The

company had available, or would have available

within a matter of weeks, test data provided free

by the Government through the National Advisory

Committee of Aeronautics on 2-section wings of

the type needed, and placing such a wing on the

model would have been a duplication. The tests

that were contemplated were intended and ac-

tually came out to be primarily tests of air in-

takes, nacelle afterbodies, stability and control

and control forces, that is, control effectiveness

and control forces, and flaps and—well, the tests

came out exactly that way.

On one occasion Mr. Bayless found it even nec-

essary to go to the Massachusetts Institute of

Technology to do the necessary development work,

which is crude, it is in the wind tunnel, on flaps

in order to provide adequate elevator effective-

ness.’’ (R. 458, Garbell.)

“Q. And did they ever build an XB-46 while

you were employed by them?

A. No, the only thing they had was a full-

sized mock-up, that is, one to determine spaces,

ete., and the mock-up wing, I looked at it very

closely in the experimental factory, had a 2-sec-

tion wing.’’ (R. 459, Garbell.)

On cross-examination, Garbell testified :

‘‘Q. Now was an airplane built according to

the plans or proposal of the XB-46?

A. Yes, an airplane was built but long after

my leaving, and a mock-up was roughed out at a

time when the management apparently planned

to go ahead and that mock-up had ‘a 2-section

wing down the experimental hangar. And I was

told, on as late as May 5, 1949, by Mr. Bayless, at

7:30 p.m. in the lobby of the Statler Hotel, while

he was waiting for Hugh Freeman of the NACA,

that at the time when I resigned and for a con-

siderable time after that the management made it —

very. ‘clear that they would have no part in the ©

production and building of that aircraft.

Mr. Gerlach. I move to strike the last part of

the answer.

The Court. No.

The Witness. Because that was entirely in

agreement with what I knew at that time.

Q. (by Mr. Gerlach). An airplane was built?

A. Yes.

Q. The XB-46?

A. Yes.

Q. From the proposal?

A. Yes.

The Court. Let us find out the time. When

was it built?

The Witness. That I don’t know, your Honor.

The Court. It wasn’t built while you were

there ?

The Witness. No.

The Court. I gathered that from what you

said.

A. A mock-up was built, which did not in-

corporate my work.

The Court. I see.’”’ (R. 255-6.)

Certainly this evidence is a far ery from the proof

of use so sorely needed by respondents. In the light

most favorable to respondents, the testimony of Bay-

less creates only a slight conflict, certainly not one

which would empower the Court of Appeals to ignore

the determination of the trial Court.

(e) The Model 110.

As in the case of the XB-46, respondents put in no

testimony whatsoever on the Model 110 save and

except the statement by their witness Bayless that

according to his recollection Garbell was still with

Consolidated when early designs on the Model 110

were in progress. (R. 300.)

Garbell testified that he suggested the use of his

wing for the Model 110 (R. 275; 467), and also:

““Q, Did you ever do any work on the Con-

solidated Vultee 110?

A. No work, no.

Q. Did you ever correct any mistakes that

others might have done on that?

A. Yes, through suggestions. I understood

that the effect of the propeller slipstream on the

longitudinal stability was quite terrible, it was

way beyond what the CAA could have possibly

tolerated, and I suggested tilting the nacelles 5

degrees to reduce that effect.

Q. Was this on a model or on a full-sized

plane?

A. No, on the model.

Q. Did you ever know until after your em-

ployment was over that they built a 110?

A. No.

Q. Did they tell you they were going to build

one?

A. No.

Q. Did they lead you to believe that they were

going to build one? :

A. No, it was supposed to be a dead duck.

Q. They said that?

A. Yes.’ (R. 458-9.)

From the testimony adduced at the trial, it is ap-

parent that, as far as the construction of models is

concerned, we are confronted with nothing more than —

incomplete demonstrational tests, which could not pos-

sibly affirm or disprove the claims of the invention,

which were abandoned prior to Garbell’s termination

of employment and which could in no possible way be

construed as reduction to practice.

(f) Garbell reduced invention to practice before employment.

There is still another point to be considered on the

question of reduction of the invention to practice, the

evidence of which stands alone and unchallenged.

It will be recalled that Garbell entered the em-

ployment of Consolidated on September 7, 1942. (R.

211.) Prior thereto, and during the summer of 1939,

he met Dr. Robert C. Platt, then a leading aerody-

namicist for the National Advisory Committee for

Aeronautics, at Elmira, New York. At this meeting,

Garbell described and explained the invention now

set forth in the Garbell patent to Dr. Platt, including

all essential elements of the patent in suit. Dr. Platt

fully understood both the principle of operation and

the structure invented by Garbell. This meeting of

Garbell with Dr. Platt was followed by correspond-

ence passing between Garbell and one Dr. George

Lewis, then Director of the Aeronautical Research of

the NACA. (R. 199-202.)

In October of 1939, Garbell became employed as an

instructor at the Boeing School of Aeronautics, Oak-

land, California. While there, he met and became ac-

quainted with an aeronautical engineer by the name of

Harry Bradford Chin, who was then instructing in

aircraft design at the Boeing School. Some time in the

Fall of 1940, during one or more discussions, Garbell

thoroughly described his invention to Chin and made

drawings and sketches to explain and illustrate his in-

vention to Chin. Both the principle of operation and

the structure invented by Garbell were fully under-

stood and appreciated by Chin. (R. 202-207.)

It is the contention of petitioners that the invention |

here involved belongs to that category of inventions

complete in and of themselves, and that it only takes

the explanation theréof to anyone skilled in the art to

enable the invention to be reduced to practice. This, of

course, is the so-called constructive reduction to prac-

tice, but the courts, in certain instances, have upheld

the theory of constructive reduction to practice over a

physical reduction to practice. We believe that this is

one of those instances.

As was said in the case of

Curtiss Aeroplane & Motor Corp. v. Janin

(C.C.A. 2), 278 Fed. 454, 456:

‘‘Reduction to practice is not merely a matter

of construction, building and trial, but may con-

sist in a disclosure of the idea by any kind of de-

seription, pictorial, verbal, or written, which will

enable one skilled in the art to make and use that

which is disclosed. We think a drawing may pos- —

sibly be a sufficient reduction to practice and an

experimental machine insufficient for the ques-

~ tion is one of degree, and the ultimate test is al-

-ways whether the inventor has shown operative

ae to that theoretical omnipresent ey

a weed | in ae art.”’

Admittedly, if respondents were making some claim

to the invention or we were involved with an inter-

ference proceeding under the patent laws, the con-

structive reduction to practice by statements and

drawings would not be sufficient to protect the in-

ventor. However, as against the defense of shop right,

it is entirely sound in principle.

Furthermore, the evidence above referred to, stand-

ing alone and uncontradicted, gives concrete sup-

port to the finding of the trial Court, and which

finding the Court of Appeals declares to be clearly er-

roneous, that the reduction to practice of Garbell’s in-

vention took place prior to his employment by Consol-

idated.

4. The employer’s cost question.

As part of the shop-right theory, and in keeping

with the equitable principle that one should not gain

at the expense of another, the employer must prove

that he was put to cost and expense, his employees

were used, and he furnished materials, all in the con-

struction of the employee’s invention, which he would

not otherwise have done. The Court of Appeals has as-

sumed such a situation in this case, but it is an a%-

sumption without foundation,

The simple fact is that the respondents failed to

place into the record any evidence whatsoever on the

question of costs, even though the defense of shop

right is an affirmative defense and the burden was

upon them to prove every component element of that

special defense.

We have demonstrated hereinabove, from an analy-

sis of the evidence, that the models made by Consoli-

dated were so made for its own express purposes and

by its own direction, upon its own idea, and to test

and evaluate its own nacelles, control surfaces and

other appurtenances, but not the Garbell wing. Under

such circumstances, no additional cost was incurred

by Consolidated. Obviously, some wing had to be

placed on the model to serve as a test platform for

these other component parts. No operating, free-flying

model of the Garbell wing, with its attendant cost, was

ever made.

The complete absence of any evidence or proof of

costs expended by the defendants creates a fatal weak-

ness in a defense predicated upon the shop-right

theory.

True, Garbell was under salary and his time was de-

voted to his employer. There is no evidence of his

spending his employer’s time working on his own

prior invention. It was fully conceived and devised

when he entered Consolidated’s employ, and is used

in the accused device in its unchanged, original form.

As has been pointed out, all that was necessary to

construct a wing according to the invention was to

specify three airfoils by camber and thickness ratio.

Even this small matter was, according to the uncon-

tradicted evidence, worked out by Garbell at home

and: not: on company time. (R. 279-280.)

the trial, reference was made to reports —

upon whi “Garbell worked, which gave the results of :

wind tunnel tests of various models, obviously for the

purpose of seeking or attempting to create the im-

pression that cost and expense were incurred by the

company, although there is no mention of a five-cent

piece in the entire record. From the analysis of the

evidence already given in this brief, it is self-evident

that the necessity for the tests and the reports was not

the Garbell invention, but the multitudinous tests that

Consolidated found necessary to make concerning

other items connected with the planes in question, such

as flaps, control system, nacelles, etc., etc.

Strangely enough, and as in other instances already

pointed out, the only evidence on this question was in-

troduced by petitioners. Garbell testified as follows:

“Q. (Mr. Frederick Lyon): Did you ever

work out the details of how to make a wing of

this kind and present the details to Consolidated,

in detail, at their expense ?

A. No.’’ (R. 280-281.)

Using the second static model of the two-engine tail-

less as an example, Garbell testified as to the method

of construction of a two-section wing and his three-

section wing, stating:

“Q. What kind of wing did that model have?

A. That was the wing, according to my sug-

gestion—I mean, well, I was told that merely to

repeat the other wing would have been a duplica-

tion. The old model had dried out in the. wind

tunnel, as they usually do, and started cracking.

- Tnasmuch as these additional tests were de-

signed to obtain information on all of the appur-

tenances and control devices there was no cost in-

curred, and, therefore, it was all right to include

my suggestion.

Incidentally, I might mention, that just because

my suggestion includes three sections—the other

one, two—that still doesn’t make any difference

in labor, because it is impossible to build a model,

even a two-section model, simply by cutting

out two sections and then letting the milling ma-

chine run between the two, because the block of

wood bends. It is necessary, therefore, to make 5

and 7 and 9 intermediate sections, even though

following a straight-line fairing, and then do the

hand work between the sections. Regardless of

how many aerodynamic control sections there are,

the work is still the same, even on a so-called two-

section wing.’’ (R. 454-5.)

If this testimony had been not in accordance with

actual fact, respondents would have introduced evi-

dence upon the subject. Garbell was not even cross-

examined on his statements, hence they stand as estab-

lished fact in this case.

5, Inventor did not assent to or acquiesce in use of invention by

employer.

The one remaining question under the shop-right

theory is this: What did the inventor do when he first

learned his former employer was using the invention?

The evidence discloses the fact that Garbell ter-

minated his employment with Consolidated in October

1945. Thereafter, about July 18, 1946, he learned that

Consolidated was then manufacturing and building its

Convair 240, which is the accused device involved

herein.

On August 5, 1946, and on August 12, 1946, Garbell

addressed communications to Consolidated and ad-

vised that company that it was using the subject-mat-

ter of an invention upon which a patent application

was then pending. (R. 218; Pitffs. Exh. 17, R. 638.)

The inventor and former employee took immediate

steps to place his former employer upon notice once

he had learned of the fact that the former employer

was for the first time using his invention. There was

no sleeping on his rights, and he did not allow the user

to go on without notice and expend further sums in

construction.

Thus, in this instance, as in all the others, we find

the complete failure of operation of the shop-right

theory.

The attention of this Court is also directed to the

fact that no claim of shop right was ever advanced,

intimated or made by Consolidated from the date of

Garbell’s employment in September 1942 until an ex-

change of correspondence between Consolidated and

Garbell subsequent to Garbell’s placing Consolidated

upon notice in August of 1946.

The testimony on this subject is very clear and the

respondents have not contended otherwise. (R. 236-

237.)

B. THE EVIDENCE ON THE INVENTION AGREEMENT —

AS IT PERTAINS TO SHOP RIGHT.

In the forepart of the decision as rendered by the

Court of Appeals, particular attention is paid to the

Invention Agreement executed on or about September

7, 1942, by Garbell and Consolidated. In analyzing the

agreement and the evidence pertaining thereto, the

Court of Appeals concurred in the opinion of the trial

Court that Consolidated had taken no steps, as pro-

vided for in the Invention Agreement, toward acquir-

ing the invention here involved, and, therefore, had

waived whatever right Consolidated may have had to

acquire Garbell’s invention or the patent issued

thereon. (R. 1143.)

The effect, however, of the Court of Appeals’ deci-

sion is that Consolidated acquired a shop right under

said agreement by reason of the terms thereof, and

particularly those provisions referred to in paragraph

6 of said agreement. Such a conclusion can only be

predicated upon the assumption that a disclosure of

Garbell’s invention was made to Consolidated under

said Invention Agreement, The Court of Appeals is in

error in making such an assumption, as the evidence

discloses :

(1) that the Invention Agreement did not op-

erate upon or in any way affect the invention in-

volved herein; and

(2) that no disclosure was made by Garbell

to Consolidated of said invention under the terms

and ‘provisions of said Invention Agreement.

These two points will now be discussed in the order

in which they are above referred to:

1. The Invention Agreement did not operate upon or in any

way affect the invention involved herein.

The crux of the agreement lies in subparagraph (a)

of paragraph 1, where a limitation is placed upon the

operation of the agreement. The pertinent language is

to the effect that the employee agrees ‘“‘to disclose

promptly in writing * * * all inventions * * * made,

developed, perfected, devised, and conceived by the

employee * * * during the employee’s employment by

the Company.”’ (Pltffs. Exh. 16, R. 633; R. 215.)

Inasmuch as the trial Court and the Court of Ap-

peals have determined that the invention was devised

and conceived by Garbell prior to employment, the

agreement can then only operate in this particular

case on an invention made, developed or perfected

during employment. It has already been demon-

strated (supra, pp. 31-45) that the uncontradicted

evidence is that said invention was not made, de-

veloped or perfected by Consolidated nor was there

a reduction to practice of said invention by Consoli-

dated during its employment of Garbell of which he

had notice or knowledge.

It is apparent then, that inasmuch as Garbell’s

invention was not made, developed, perfected, devised

or conceived by Garbell, either solely or in collabora-

tion with others, during Garbell’s employment by

Consolidated, the Invention Agreement cannot have

any effect whatsoever upon this particular invention.

Under such circumstances, it is absolutely impossible

for Consolidated to have acquired a shop right, or

any other right.

2. No disclosure was made by Garhell to Consolidated of said

invention under the terms and provisions of said Invention

Agreement.

(a) Garbell’s knowledge of patent procedure of Consolidated.

The record in this case shows that Consolidated

maintained at all times during Garbell’s employment

a Patent Department, and had a well-established sys-

tem set up whereby ideas and inventions made or con-

ceived by an employee could be submitted to the com-

pany under the Invention Agreements previously

signed by each employee. The procedure adopted by

the company and followed by it is completely out-

lined in the testimony of respondents’ witness Walter

J. Jason, Assistant Patent Director of Consolidated

(R. 351, et seq.). From such testimony, and from the

Invention Agreement itself, the consecutive steps

taken were as follows:

(a) A written disclosure made by the em-

ployee to the Patent Department;

(b) Within a period from one to four weeks

thereafter, the employee would receive a written

notice advising him of receipt of the disclosure,

- the docket number assigned to it, and that he

would be advised of the results of the company’s

investigation ;

(ce) If the company, after investigation, con-

sidered any invention patentable, the inventor

was paid the sum of $10.00;

(d) If the company elected to acquire the in-

vention, written notice of that fact was sent to

the inventor ;

(e) Thereafter the employee would be re-

quested to execute two forms:

1-80-39 ‘‘Notice of Election to Acquire In-

vention’’

1-80-42 ‘‘Assignment of Invention’’

(f) As an alternate step, should the company

believe the invention to be unpatentable, or should

it elect not to acquire it, written notice was sent

to the inventor, telling him of that fact and stat-

ing that the case was being placed in the inactive

file of the company; in addition, the inventor was

advised that he could have a release if he so

desires.

Within not too long a period after his employment,

Garbell, at the suggestion of Bayless, his superior,

went to see Donald Hall, who was then in charge of

the Patent Department of Consolidated. Hall ex-

plained to Garbell the functions of the Patent De-

partment and how it operated, especially with refer-

ence to the Invention Agreement (R. 447-448).

Thus, Garbell obtained full knowledge of the oper-

ation of the Patent Department and the Invention

Agreement, the method involved in submitting a dis-

closure under the Invention Agreement, and what was

expected of him and what he could expect from the

company.

(b) Disclosures made by Garbell to Patent Department.

Between March 29, 1943, and April 30, 1945, in

accordance with the said Invention Agreement, Gar-

bell formally submitted to Consolidated seven disclos-

ures, which covered the following alleged inventions :

Slotted Armor Plate.

Retractable Tail Surface.

. Hydrofoil for Airplanes.

. Wing Tip Fin.

High-speed Air Intake.

. Dropable Jet Augmenter.

7. Longitudinal Control for Jet Aircraft.

All of these disclosures were duly docketed by Con-

solidated and duly given numbers within a short time

after their submission (R. 353). Thereafter, the pro-

cedure as outlined in the Invention Agreement was

- followed and the successive steps taken by Consoli-

dated. The situation is characterized by the following

testimony of Garbell:

*‘Q, Whenever you made a disclosure to the

corporation in writing other than with reference

to this invention before this court, were you im-

mediately paid by Consolidated for that sugges-

tion? —

- A. The immediate step was to follow a certain

procedure, that is, regarding inventions that did

fall under the Invention Agreement, followed by |

the payment provided for in the Invention Agree-

> And you were always paid on these sug- —

gestions ? : a

A. On most of them, of those that were given

consideration, yes, and the payment was prompt.”’

(R. 283.)

The testimony discloses that of the seven disclosures

made by Garbell to Consolidated two of them were

accepted by the company. These were the hydrofoil

for airplanes and the high-speed air intake. ‘'There-

after, the various payments called for by the Inven-

tion Agreement were made, and eventually Garbell

executed the assignments, etc., as called for by the

agreement. In the case of the disclosure for an alleged

invention for slotted armor plate, Consolidated did

not accept the invention, notified Garbell to that ef-

fect, and duly executed a release under date of Feb-

ruary 24, 1944. (R. 316-322.)

There is no question but that Garbell, on the one

hand, and Consolidated, on the other, knew what was

expected of each under the terms of the Invention

Agreement, and the procedure which was to be fol-

lowed, had been followed, and would be followed.

In December 1944, Garbell prepared a scientific

paper for presentation to the Institute of Aeronauti-

cal Sciences. Such paper was prepared upon the

request of his superiors, T. P. Hall and Bayless,

under direction that the subject-matter was to be on

some scientific matter, but eliminating anything of

military significance and likewise eliminating anything

that would tend to disclose actual company activities.

(R. 289-290, Garbell; R. 301, Bayless.)

In the conversation which T. P. Hall had with

Garbell, he suggested that Garbell write about his

wing. (R. 290.)

The document in question, as prepared by Garbell

and sent by Consolidated to the Institute of Aero-

nautical Sciences as a technical paper, was introduced

in evidence by appellants, as their Exhibit D, during

their cross-examination of Garbell. In characterizing

the paper so prepared by him, Garbell testified :

“Q. (By Mr. Gerlach). Does Exhibit D con-

tain a description and illustrations exemplifying

your patent in suit?

A. It contains a very broad scientific explana-

tion of the basic principles.

Q. It contains descriptions and it contains

drawings which, to some extent, follow the draw-

ings of your patent, do they not?

A. Broadly speaking, yes.” (R. 269, Defts.

Exh, D; R. 775.)

“«

If this Court will take but a moment to glance at

Plaintiffs’ Exhibits 26 (R. 669-676; R. 320) and 27

(R. 677-683 ; R. 322), it will immediately observe that

there is absolutely no similarity between actual dis-

closures to the Patent Department of Consolidated

and the scientific paper (Defendants’ Exhibit D, R.

775; R. 269). It is not, nor was it intended to be,

a ‘‘disclosure’’ within the terms of the Invention

Agreement.

(a) Neither Garbell nor Consolidated considered the paper to be a ‘‘dis-

aemare™. under the Invention Agreement.

In séeking the proper interpretation to be placed 3

upon a contract, nero, or state of facts, the —

Courts have long looked toward the actions of the

parties themselves with regard thereto, in order to

give a practical construction to the matter upon which

the Court has to reach a decision. Such procedure

applied to this case gives abundant proof that neither

Garbell nor Consolidated ever believed that the scien-

tific paper prepared by Garbell at Consolidated’s re-

quest was a disclosure of an invention under the

Invention Agreement.

As to Garbell.

This Court will readily appreciate that, by reason

of his talks with Consolidated’s Patent Department

representatives and the many occasions during his

employment Garbell submitted disclosures to Consoli-

dated specifically acting under the Invention Agree-

ment, he was thoroughly and completely familiar with

what was required of him by way of form of sub-

mission of an idea, drawing, etc., and that he was

required to be as specific as possible with relation

to every phase of any such disclosure. Likewise, Gar-

bell was thoroughly familiar with the steps, prelim-

inary or otherwise, which Consolidated took with

reference to a disclosure made to it under the Inven-

tion Agreement by an employee; and that this would

result in patent studies, search of prior art, and

conferences with Consolidated’s Patent Department.

In this particular instance, he was requested by

his employer to prepare a scientific paper, to be a

contribution on Consolidated’s behalf to the annual

meeting of the Institute of Aeronautical Sciences.

Pursuant to his instructions not to use anything of

a military nature or write about a subject which was

involved with or as a company project, and following

the suggestion of his superior that he write about his

(Garbell’s) wing, the paper in question was prepared

in December of 1944.

While Garbell knew that this was not a paper

prepared for a disclosure of an invention, he did

realize that for the first time he was releasing for

presentation to the public enough material and data

concerning his invention, all of which might easily

and detrimentally affect any application for a patent

which he might thereafter make.

Having in mind that during the two preceding

years of employment he had become thoroughly

familiar with the dangers of public release of patent-

able ideas, Garbell knew that he should take some

steps to protect himself. Therefore, with the ‘sole

purpose in mind of protecting his patent rights, he

transmitted a copy of the paper, as prepared, to D. A.

Hall, a patent engineer of Consolidated, accompany-

ing the same with an interoffice memorandum in

which he stated that he was making an official dis-

closure (patentwise) of invention. Considering the —

circumstances which then existed, and the conditions —

under which the paper was prepared, the language 3

of his memorandum to Hall would, to Garbell’s mind, —

act as a red flag to Consolidated and direct their —

attention to the fact that he had exclusive property

rights in the invention described in the paper. :

Nothing further was done by Garbell, nor was

there anything required of him to be done. He had .

protected his rights in an invention which he had

at all times possessed long before entering his employ-

ment with Consolidated.

As to Consolidated.

First of all, there is, of course, the fact that Con-

solidated requested the preparation of the paper, not

as an invention disclosure and not with that thought

in mind, but so that the company would have a paper

presented on its behalf at the next meeeting of the

Institute of Aeronautical Sciences. It is apparent

that, with T. P. Hall’s suggestion to Garbell that

the article be written concerning Garbell’s wing, Con-

solidated knew that the wing was not a company

project nor involved as such.

A copy of the paper, with its memorandum of

transmittal, which, in effect, put Consolidated upon

notice, was received by D. A. Hall, a patent engineer

of Consolidated. Thereafter not one step under the

Invention Agreement was taken by Consolidated. We

have listed the procedure to be followed under the In-

vention Agreement (supra, p. 52), and that pro-

cedure was followed in all cases, not only with rela-

tion to all ideas which Garbell had submitted under

that agreement, but it was the regular, usual and

adopted practice that was followed in every case,

according to the testimony of Consolidated’s patent

attorney, Jason. (R. 351-359.),

Garbell’s written memorandum to Consolidated

transmitting the copy of the paper in question bears

date December 9, 1944. Under the Invention Agree-

ment, a docket number is given a submission of inven-

tion by an employee, and he is advised thereof by

letter within thirty days after the submission of the

idea. The records of Consolidated show that it as-

signed a docket number to the scientific paper on or

about January 24, 1946 (R. 354, Jason), which is

over a year after it had received the paper and

months after Garbell had terminated his employment

with Consolidated.

Consolidated, between December 20, 1944 and Jan-

uary 24, 1946, had, obviously, taken no steps concern-

ing this matter. Once the docket number was given

this paper, nothing further was done except to mark

it ‘‘Inactivated”. Not a communication was sent to

Garbell. Garbell had not appeared at the Patent De-

partment. (R. 360.)

Mr. Jason, Consolidated’s assistant patent director,

testified that ‘‘no report of any kind was ever sent

to Dr. Garbell either of the submission of that idea

to the Patent Department or to advise him that the

Patent Department was processing that matter”. (R.

363.)

To further highlight this matter, the record dis-

closes that on March 26, 1947, and April 7, 1947, the

Patent Department of Consolidated wrote Garbell, at

his then address, advising hinn that the company was

inactivating Garbell’s disclosure of high-speed air

intake, made on November 17, 1944. (R. 365; Plain-

tiffs’ Exhibits 31 and 32, R. 692,693.) —-

Consolidated did not advance any claim of shop

right or license at the time that it received the scien-

tific paper, which it now contends is a disclosure

under the Invention Agreement, nor did it advance s

such a claim at any time until after Garbell had |

advised it that it was using his invention, in the fall

of 1946. i

On August 5, 1946, Garbell wrote to Consolidated

concerning the use by them of his invention and

notifying Consolidated that application for letters

patent was pending. (R. 638, Plaintiffs’ Exhibit 17;

R. 218.) On August 9, 1946, Consolidated answered

said letter, stating, in part, as follows:

‘‘We will accept a copy of the patent ap-

plication to which you refer for the purpose of

a disclosure, on the basis that in so doing the

disclosure is made to us without obligation ** *’’

(R. 641, Plaintiffs’ Exhibit 18; R. 219.)

It is perfectly apparent that Consolidated was

asking for the first time for an official disclosure and

was not making any claim of shop right.

In answer to Consolidated’s letter, Garbell, on

August 12, 1946, wrote Consolidated and referred

them to his paper appearing in the February 1946

issue of the Journal of the Aeronautical Sciences, as

a document which stated the basie principles under-

lying his invention. (R. 639, Plaintiffs’ Exhibit 17;

R. 218.) It is to be noted that this was the publication

of the scientific paper prepared for that purpose by

Garbell in December 1944, while with Consolidated.

Following receipt of Garbell’s letter under date

of August 12, 1946, and just referred to, Consoli-

dated, for the first time, took the position that the

scientifie paper written in December 1944 constituted

a disclosure of invention under the terms of the In-

vention Agreement and that it had a shop right.

Just before Garbell left the employ of Consoli-

dated, in October 1945, he had a conversation with

D. A. Hall above referred to, who was the patent

engitieer to whom Garbell had sent the copy of the

scientific paper nine or ten months before. During

that conversation, no mention was made to Garbell

of the matter now before the Court, and no shop right

or other right was even intimated. (R. 449.)

One last fact concerning the acts of Consolidated

is called to the attention of the Court, as it sums up

the entire matter. Under direct examination, Garbell

testified :

“Q. At any time did they inform you that

they intended to use this invention of yours?

A. No.

Q. They never led you into the opinion they

intended to use it?

A. No.

Q. Did they completely reject this invention

at all times? .

A. Yes, in each case.

The Court. During any of those conversations,

was anything ever said to you regarding shop

rights, regardless of the merit, such as, ‘If it is

any good, it is ours, anyway’?

The Witness. No.

The Court. Was any such claim made during

these conversations ?

The Witness. No.

The Court. When did you hear for the first

time that shop rights were being claimed ?

The Witness. After I directed my correspond-

ence to the company, immediately following ap-

plication.

The Court. Filing of your application.’”’ (R.

236-237.)

From all of the evidence, which is uncontradicted,

it must be obvious to this Court that the principals

in this matter did not ever consider or look upon

the scientific paper in question as a disclosure under

the Invention Agreement. This is amply demonstrated

by their actions, as hereinabove reported.

VIII.

CONCLUSION.

We believe that a consideration of the evidence

as pointed out in this brief will result in this Court’s

concluding that none of the elements necessary to

establish the defenses of shop right or implied license

exist, and that the findings of the trial Court on said

issues were and are more than amply supported by

said evidence.

It is respectfully submitted that the petition for

certiorari to review the decision of the Court of Ap-

peals for the Ninth Circuit should be granted.

Dated, San Francisco, California,

August 24, 1953.

THEODORE H. RocHe, |

Counsel for Petitioners.

TxHeo. J. RocHz,

SuLiivan, RocHe, JoHNSON & F'ARRAHER,

Of Counsel.

SUBJECT INDEX

PAGE

Opinions below 1

Statement of jurisdiction 2

Counterstatement of the case 2

The relevant facts 3

Question presented 13

The argument 14

(a) In general - 14

(b) Respondents have an express license under the patent

in suit 15

in suit 22

Conclusion 26

TABLE OF AUTHORITIES CITED

CasEs PAGE

Bloomer v. McQuewan, 55 U. S. 539, 14 L. Ed. 532 17

Clark Thread Co. v. Willimantic Linen Co., 140 U. S. 481, 11

S. Ct. 846, 35 L. Ed. 521 19

Curtiss Aeroplane & Motor Corp. v. Janin, 278 Fed. 454.............. 37

District of Columbia v. Gallaher, 124 U. S. 505, 31 L. Ed. 526... 16

Elzilaw Co. v. Knoxville Glove Co., 22 F. 2d 962 26

Fields v. United States, 204'U. S. 291, 27 S. Ct. 281, 51 L. Ed.

490 14

General Talking Pictures Co. v. Western Electric Co., 304

U. S. 175, 58 S. Ct. 849, 82 L. Ed. 1273 14

Gill v. United States, 160 U. S. 426, 16 S. Ct. 322, 40 L. Ed.

480 18, 24, 25, 26

Heywood-Wakefield Co. v. Small, 87 F. 2d 716 18

Keller v. Potomac Electric Power Co., 261 U. S. 428, 43 S. Ct.

445, 67 L. Ed. 731

Lane & Bodley Co. v. Locke, 150 U. S. 193

McClurg v. Kingsland, 1 How. 202

Mitau v. Roddan, 149 Cal. 14, 84 Pac. 145, 6 L. R. A. 275........ 16

Panama Mail S.S. Co. v. Vargas, 281 U. S. 670, 50 S. Ct. 448,

RR F

74 L. Ed. 1105 14

Solomons v. United States, 137 U. S. 342, 11 S. Ct. 88, 34 L.

Ed. 667 25, 26

Standard Parts Co. v. Peck, 264 U. S. 52. 15

Tin Decorating Co. v. Metal Package Corporation, 29 F. 2d

1006; aff'd, 37 F. 2d 5; cert. den., 281 U. S. 759, 74 L. Ed.

1168 26

United Staves\v. Dubilier Condenser Corp., 289 U. S. 178, 53

S. Ct. 584, 77 L. Ed. 1114 19, 24, 26

PAGE

United States v. United States Gypsum Co., 333 U. S. 364, 68

S. Ct. 525, 92 L. Ed. 746. 14, 15

Waterman v. Mackenzie, 138 U. S. 252, 11 S. Ct. 334, 34 L.

Ed. 923 17

Rugs

Federal Rules of Civil Procedure, Rule 52(a)

Rules of the United States Supreme Court, Rule 38(5)

STATUTES

United States Code Annotated, Title 28, Sec. 1254(1)

United States Code, Title 35, Sec. 31

sue

Supreme Court of the United States

October Term 1953

No. 301

Maurice A. GARBELL, INC., a corporation, and GARBELL

RESEARCH FOUNDATION, a corporation,

Petitioners,

VS.

CONSOLIDATED VULTEE AIRCRAFT CORPORATION, a cor-

poration, and AMERICAN AIRLINES, INC., a corporation,

Respondents.

RESPONDENTS’ BRIEF IN OPPOSITION TO

PETITION FOR WRIT OF CERTIORARI.

To the Supreme Court of the United States:

A. Opinions Below.

The opinion of the Trial Court appears at R. 37 and

is reported at 94 Fed. Supp. 843. The opinion of the

Court of Appeals for the Ninth Circuit appears at R. 1139

and is reported at ............ F. 2d: 22, 98: ULS: Pi Q. 4 A

Petition for Rehearing was filed in the Court of Appeals

by petitioners on July 7, 1953, and the same was denied

by the Court of Appeals on July 13, 1953 [R. 1149].

ieee

B. Statement of Jurisdiction.

Petitioner invokes the jurisdiction of this Court under

Title 28, U. S. C. A., Section 1254(1).

C. Counterstatement' of the Case.

This is a patent infringement action, the District Court

having entered judgment [R. 58] sustaining the validity

and infringement of the patent in suit. The Court of

Appeals reversed such judgment, holding that defendants

have a license (i. e., shop-right) under the patent in suit,

and expressly made no decision as to either validity or in-

fringement of the patent in ‘suit [R. 1148].

The: Petition (p. 4) concedes that the question: involved’

concerns only an interpretation of the facts; stating:

“To resolve the question involved, turning as it

does entirely upon fact... .”

The only reason set forth in the Petition (pp. 16-18)

for its allowance is. that the Court of Appeals allegedly

abused its discretion by not accepting the Findings of

Fact of the District Court.

The Petition: does not even.allege that “there are..any

special and important reasons” in its support, as required

by Rule 38(5) of’ this Court, and*in particular:

(a) The Petition does not allege that any federal

question: is here involved;

(b) The Petition does not: allege that the decision

of the Court of Appeals.is.in conflict: with that-of any,

other court of appeals on the. same matter;

of local.law is here involved; ae

(d) The Petition does not allege that the Court of _

Appeals in its decision has so far departed from any

ssa Mons

accepted or usual course of judicial proceedings as to

call for any exercise of the power of supervision of

this Court; and

(e) The Petition does not allege that any public

question is here involved.

The Petition, in effect, merely complains that the Court

of Appeals, after a review of the record in this case,

came to a different interpretation of the facts than that of

the District Court.

There is no reason, so far as the public interest is con-

cerned, supporting the granting of the Petition. On the

contrary, the public interest requires a denial of the Peti-

tion. Over 170 “Convair” airplanes have been sold by

respondent Consolidated [R. 418] and are in extensive

commercial airline service operated by respondent Amer-

ican Airlines and other airlines providing travel service to

the public. To grant the Petition would simply be a step

towards sustaining the patent in suit and, by injunction,

grounding and forcing out of service such “Convair” air-

planes, to the great injury and inconvenience of the public.

Since the Petition and Petitioner’s Brief are largely

devoted to an exposition of alleged facts pertinent to the

issues here involved, and since the statements of fact

therein are largely misleading and in many instances er-

Toneous, a restatement of the significant facts is in order

and is presented in the following section,

The Relevant Facts.

Letters Patent No. 2,441,758 in suit [R. 605], issued

to the patentee Garbell, covers an airplane wing construc-

tion, sometimes hereinafter referred to as the “alleged

invention in suit.”

mls

-Garbell, the patentee of the patent in ‘suit, was em-

ployed by respondent. Consolidated on September 7, °1942,

and terminated his employment on October. 15, 1945 ‘( Pet.

pp. 6,14). The application for Letters Patent: No..2,441,-

758 was filed on July 16, 1946, less than one -year.after

Garbell terminated his employment with Consolidated.

The District Court found, in effect, that Garbell had

“conceived” (as distinguished from “reduced to practice’’)

the alleged’ invention in suit prior to his employment by

Consolidated, but, as pointed out by the Court of Appeals

[R.°1146], the only evidence supporting such finding -was

the testimony of Garbell himself. In the record there ‘is

no corroboration of any kind of Garbell’s testimony ‘that

he had conceived the alleged invention in suit prior to his

employment by ‘Consolidated.

Garbell testified that shortly after his employment by

Consolidated he disclosed his alleged invention to his su-

perior in the company, Mr. Bayless [R. 446]. This was

denied by Bayless who testified [R. 303] that the earliest

that he knew of the invention was when Garbell and his

co-workers Rogers and Fiul presented to Bayless a written

report, Exhibit A [R. 1007], which is dated February 25,

1944, relating to the “Two-Engine Tailless” design, ‘an

airplane then being designed’ by Consolidated.

Garbell admitted that he suggested to Consolidated that

it use his alleged invention in its “Two-Engine Taifless

Design” [R. 250], and admitted that’ Exhibit A [R. 1007]

embodies the principles of his invention [R. 247]. Ex-

hibit A shows on its face [R. 1007] that it was a report

and suggestion jointly made to Consolidated by Fiul, Gar-

bell and Regers (all employees). Exhibit A covers sixty-

three pages of the record [R. 1007-1070], and ‘includes

extensive engineering calculations relating to the use of

sills

the alleged invention in suit in the Consolidated “Two-

Engine Tailless” airplane. Exhibit A shows on its face

at R. 1007 that it was “approved by Consolidated.” Bay-

less testifiel that such suggestion by Garbell was approved

by Consolidated and incorporated in its “Two-Engine

Tailless” design [R. 324]. Petitioners’ Brief (pp. 36,

38, 39) concedes in effect that the “Two-Engine Tailless”

was one of the Consolidated airplane designs for which

Garbell suggested his alleged invention.

Petitioners’ Brief (p. 38) concedes that “three models

were built” by Consolidated of the “Two-Engine Tailless,”

the second of which, at least, included the alleged inven-

tion in suit.

ixhibit B [R. 694-774] contains many inter-company

reports signed by Garbell and other Consolidated em-

ployees showing the extensive work done by Consolidated

with models using the alleged invention in suit in the

“Two-Engine Tailless,” and showing his full knowledge

of and participation in the same. Representative reports

are detailed as follows:

(a) A “scale power-off model” of the “Two-En-

gine Tailless” was tested in the Galcit 10-foot wind

tunnel from Feb. 28, 1944 to Mar. 5, 1944, which

showed that the “revised wing” (1. ¢., the alleged in-

vention in suit) was satisfactory, but suggesting spe-

cific structural modifications [R. 694-696]. Such

test demonstrated the improved stall performance of

the new revised wing incorporating Garbell’s alleged

invention [R. 695], the improved results being set

forth in detail [R. 698-702].

(b) A “power-on model” of the “Two-Engine

Tailless” was actually in the Galcit wind tunnel on

March 7, 1944 [R. 696].

silie

(c): Additional “power-off” tests of the ““Two-En-

gine Tailless” airplane were conducted from March

28, 1944, to April 7, 1944, at Massachusetts Insti-

tute of Technology with a wing that had been modi-

fied with respect to that tested at Galcit [R. 705].

(d) Free-flight tests of a model of the ““Two-En-

gine Tailless” airplane were made prior to July 1,

1944, showing collaboration by Rogers of Consoli-

dated [R. 725].

(e) Additional wind tunnel tests of the scale model

of the “Two-Engine Tailless” using a modification

of the “revised wing” (which included the alleged

invention in suit) were made at Galcit in late July,

1944 [R. 735].

(f) Additional wind tunnel tests of a scale model

of the “Two-Engine Tailless” were made by Consoli-

dated prior to August 6, 1944 [R. 745].

(g) The “power-off” models of the “Two-Engine

Tailless” each required about 3500 man-hours in their

manufacture [R. 755-757].

(h) As late as December, 1944,. Garbell was still

trying to increase flying stability of the “Two-Engine

Tailless” [R. 758-759].

The foregoing test reports on the “Two-Engine Tail-

less” airplane models plainly indicate the many changes

and modifications that were made in the models during

such tests [petitioners’ allegation (p. 10), that no changes

were made, to the contrary notwithstanding].

The extensive testing by Consolidated of at least one

model of the ““Two-Engine Tailless” including the alleged

invention in suit while Garbell was employed by Consoli-

dated was confirmed by Garbell who testified that “there

were hundreds and hundreds of runs that went into that”

[R. 454].

The Garbell patent No. 2,441,758 in suit states [R.

605, Col. 10, lines 50-64]:

“Numerous flight tests and wind-tunnel tests in

reputable wind-tunnels such as the California Insti-

tute of Technology, the Massachusetts Institute of

Technology, the various wind tunnels of the Na-

tional Advisory Committee for Aeronautics, and else-

where have demonstrated convincingly that each of

the objects of this invention has been fully achieved.

The tests were performed on numerous wing models,

on sailplanes, and on models of at least five aircraft

designs of widely varying design scope employing a

wide variety of airfoil series. Force-test records,

photographic records, and cinematographic records of

the tests substantiate the attainment of the objects

of this invention” (emphasis added).

Garbell identified such wind-tunnel tests referred to in

his patent as those performed by Consolidated with models

of the Consolidated “Two-Engine Tailless” and XB-46

airplanes in the wind tunnels at the California Institute of

Technology, the Massachusetts Institute of Technology,

and the National Advisory Committee for Aeronautics,

including his alleged invention [R. 260-262]. Such tests

made by Consolidated of the alleged invention obviously

constituted a reduction to practice thereof, as they “dem-

onstrated convincingly that each of the objects of this

invention has been fully achieved” as stated in the patent

in suit.

Garbell stated that prior to his employment by Con-

solidated no one had ever designed an airplane wirg em-

esac meor nance ora gre eos mca

ipl

bodying his alleged invention, and that even up to the

date of the trial in the District Court neither Garbell nor

anyone acting for him had ever manufactured such a

wing [R. 238-239]. The Garbell patent in suit has had

no public acquiescence or any commercial success what-

ever.

Garbell admitted that he suggested that Consolidated

use his alleged invention in suit in a military bomber, the

XB-46, being designed by Consolidated while he was em-

ployed by Consolidated’ and that they ultimately did so

after he left its employ [R. 252-255, 262]. Petitioners’

Brief (p. 36), in effect, admits the same thing. Ex-

tensive conferences were had in May, 1945, with respect

to wind tunnel testing of the XB-46 design, between Con-

solidated (represented by Garbell and a co-employee Shue)

and National Advisory Committee for Aeronautics repre-

sentatives, in which many weeks of tests of a variety of

models made by Consolidated were planned [R. 760-774],

obviously with Garbell’s full knowledge and consent. Gar-

bell admitted that Consolidated made a model of a wing

for its XB-46 bomber and tested the same in the wind-

tunnel at the Massachusetts Institute of Technology, which

test was one of those referred to in his patent in suit as

demonstrating “convincingly that each of the objects of

this invention has been fully achieved.”

Garbell also admitted that while employed by Consoli-

dated he suggested to it that it use his alleged invention

in its Model 110 airplane being designed by Consolidated

[R. 275, 466-467]. A full sized Model 110 airplane was

completed and extensively flight-tested by Consolidated

after Garbell left its employ [R. 416-419], the actual

flight tests of such Model 110 being recorded in Exhibit

35. Such Exhibit 35 shows the many changes and struc-

melnen

tural modifications made by Consolidated in the wing and

accessories therefor before it could obtain satisfactory

flying results with such wing. As admitted by Garbell

[R. 272], such accessories on a wing affect the aerody-

namic results, thus indicating the necessity of full testing

of an airplane wing to establish a reduction to practice

thereof.

The wing of Consolidated’s Model 110 airplane was

later used by it in the “Convair” (Model 240) airplane

[R. 418] which is here charged by petitioners to infringe

the patent in suit. Garbell thus suggested to Consolidated

while he was in its employ that it use substantially the

identical wing which was ultimately used by it in its “Con-

vair” airplanes here charged to infringe.

When Garbell was employed by Consolidated he exe-

cuted an Invention Agreement, Exhibit 16 [R. 633], the

pertinent provisions of which are as follows:

“1. The Employee agrees:

(a) To disclose promptly in writing to the Com-

pany’s Patent Department or to such person as the

Company may designate, all inventions and improve-

ments heretofore or hereafter made, developed, per-

fected, devised or conceived by the Employee either

solely or in collaboration with others during the Em-

ployee’s employment by the Company, whether or

not during regular working hours, and including a

period of one (1) year after termination of employ-

ment, relating to aircraft or parts and the manu-

facture thereof, or relating in any way to aviation

or to the business, developments or products of the

Company ;

6. If the Company shall fail to elect in writing

that it desires to prosecute a patent application on

sail

any invention or improvement specified in paragraph

1 hereof within nine months following the com-

plete disclosure thereof to the Company, then: all

rights of the Company in and to such invention or

improvement shall revert to the Employee with the

exception only that the Company shall have a free

shop right with respect thereto.”

On December 20, 1944, while he was employed by

Consolidated, Garbell delivered to its Patent Department

a paper, Exhibit D {R. 775], which set forth the alleged

invention of the patent in suit [R. 269-270], together with

a covering memoranda, Exhibit E [R. 789), the latter

being signed by Garbell and stating:

“Please consider this paper an official disclosure

of invention. I shall be glad to complete the dis-_

closure with any additional material that may be re-

quested by you.”

By memorandum dated January 8, 1945, Exhibit F

[R. 790], the Consolidated Patent Department requested

additional information from Garbell as to his said dis-

closure. Such information was never provided by Garbell.

There is no evidence in the record that Garbell ever at

any time while he was employed by Consolidated made

any claim, in substance or effect, that his alleged imven-

tion in suit was his separate property, or that he expected

Consolidated to treat it as such, or that he had any claim

adverse to Consolidated with respect thereto. At no

time while employed by Consolidated did Garbell raise any

objection to its use of the alleged invention in suit, and,

to the.contrary, at all times urged Consolidated to adopt

and use the invention (Pet. p. 33).

tte

The nature of Garbell’s employment by Consolidated

and the variety and responsibility of his duties while so

employed are important to note. Garbell’s initial tele-

graphic application for employment [R. 617] stated:

“Can you offer advanced field of activity of experienced

aeronautical engineer. Well versed in airplane and en-

gine design, performance analysis and research. Have

three successful original designs to my credit.” Gar-

bell’s follow up [R. 619] of his initial telegram stated:

“I am primarily interested in being placed where my

ability may find its greatest usefulness in your organi-

zation, namely preliminary design or research engineer-

ing.” This correspondence clearly shows that Garbell

was seeking employment in which he could design air-

planes.

Garbell’s first work for Consolidated was design work

in connection with aircraft [R. 216]. Garbell was origi-

nally employed as an “Aerodynamics Engineer A,” and

effective November 1, 1943, he was promoted to “Design

Engineer” [R. 802, 804], the change being made for a

“Merit Increase.” Effective March 16, 1944, he was

promoted to “Group Engineer,” and effective February

1, 1945, he was promoted to “Design Specialist A” [R.

803]. Exhibit I [R. 801] and the portions thereof en-

titled “Stability and Control,” “Special Projects,” and

“Prediction of Tompressibility Effects” list the typical

duties of Garbell while employed by Consolidated [R.

297], which plainly indicates that Garbell’s duties in-

cluded work on “new designs” of airfoils, vrind-tunnel

reports, test predictions, and related subjects pertaining

to aircraft and aircraft wings. As a part of his duties,

Garbell was not only working on the design of aircraft

but in such work had under his supervision and control

eight engineers, as is shown by Exhibit H [R. 800, 396].

Garbell was obviously employed by Consolidated to design

and test wings for aircraft, and the record in this case

shows that he did so practically throughout this employ-

ment.

Garbell’s salary was raised by Consolidated after his

initial written suggestion with regard to and work on

the testing of the “Two-Engine Tailless” airplane early

in 1944, and his disclosure of invention in December,

1944. Thus, on May 1, 1944, he was a Group Engineer

and his semi-monthly wage was increased from $247.50

to $267.50 [R. 803]. Again on February 1, 1945, he

was promoted from Group Engineer to Design Specialist

and his semi-monthly wage was raised from $267.50 to

$285.00 [R. 803].

The Court of Appeals held that “During his employ-

ment by Consolidated, Garbell disclosed his alleged in-

vention to Consolidated” [R. 1143], which is in accord

with Finding of Fact XXXVII of the District Court

[R. 53].

The Court of Appeals held that Consolidated did not

waive the shop-right provided to it by paragraph 6 of

the Invention Agreement becween it and Garbell [R.

1143] and that: “The District Court did not find, nor

did the evidence warrant a finding, that Consolidated

ever ‘rejected’ or waived that shop right” [R. 1147].

The Court of Appeals held that the findings of the

District Court that Garbell made, developed, and per-

—13—

fected his alleged invention prior to his employment by

Consolidated “were not supported by evidence and were

clearly erroneous” [R. 1145], holding that “the evi-

dence showed that if Garbell ever made, developed or per-

fected his alleged invention, he did so during his employ-

ment by Consolidated” [R. 1146].

The Court of Appeals held an invention is not “made,

developed or perfected until reduced to practice’ and

that “There was no evidence that Garbell reduced his

alleged invention to practice prior to his employment by

Consolidated. Instead, the evidence showed that, if he

ever reduced it to practice, he did so during the employ-

ment” [R. 1146]. The Court of Appeals held that “if

Garbell ever made, developed or perfected his alleged in-

vention, he did so by and through the use of materials

and facilities of Consolidated and time for which he was

paid by Consolidated” [R. 1147].

The record in this action, for example as referred to

above, clearly shows that all of the evidence in this action

clearly supports the decision of the Court of Appeals.

D. Question Presented.

Although the Petition (p. 15) states four alleged

“questions,” actually there “; only one question presented

by the Petition, as follows:

Do the facts in this case justify the Court of Ap-

peals decision reversing the District Court on factual

issues?

a See

E. The Argument.

(a) In General.

The only questions presented by the Petition are as

to the facts and the inferences to be drawn from the

facts. This Court has uniformly denied petitions for

certiorari where, as here, the only questions presented

are factual. (General Talking Pictures Co. v. Western

Electric Co., 304 U. S. 175, 178, 58 S. Ct: 849, 82 L. Ed.

1273; Fields v. United States, 204 U. S. 291, 27 S. Ct.

281, 51 L. Ed. 490.) The Petition should be denied on

this ground alone.

This action for patent infringement prays for a per-

manent injunction [R. 4] and such injunction has been

ordered by the District Court [R. 59]. This is an action

in equity, and in such an action “the review, unlike that

on a writ of error at law, extends to the findings of

fact as well as to the rulings on questions of law.” (See:

Panama Mail S. S. Co. v. Vargas, 281 U. S. 670, 50

S. Ct. 448, 74 L. Ed. 1105; Keller v. Potomac Electric

Power Co., 261 U. S. 428, 43 S. Ct. 445, 67 L. Ed. 731.)

The Court of Appeals, having clearly in mind [R.

1146] the requirements of Rule 52(a) of the Rules of

Civil Procedure, had the record before it as to both the

facts and the law, and under the foregoing authorities

had full power to reverse the District Court on its find-

ings of fact. .

The Petition relies heavily upon Umited States v.

United States Gypsum Co., 333 U. S. 364, 68 S. Ct. 525,

92 L. Ed. 746. However, petitioners can find no comfort

in that case because there this Court held that certain

findings of fact of the District Court were “clearly er-

roneous,” just as the Court of Appeals has done here.

—15—

The Gypsum Co. case, supra, in fact is direct support

for the decision of the Court of Appeals in this case, as,

obviously, the Court of Appeals here, after a careful

review of the whole record in this case, was “left with a

definite and firm conviction that a mistake has been

committed” by the District Court. The decision of the

Court of Appeals in the present case was unanimous.

Consolidated could have acquired the entire legal title

to Garbell’s alleged invention in suit under the Invention

Agreement, Exhibit 16 [R. 623] by paying him not to

exceed $100.00. Or it could have asserted title thereto

under the doctrine of Standard Parts Co. v. Peck, 264

U.S. 52. It has done neither, leaving title in Garbell, for

him to enjoy the patent in suit against the whole world

other than respondents. All that Consolidated claims is

a shop-right to free it from the inequitable claim made

here by Garbell.

(b) Respondents Have an Express License Under the

Patent in Suit.

The Court of Appeals held [R. 1145-1146] that re-

spoxdents have an express license (i. ¢., shop-right) under

the Garbell patent in suit under the Invention Agreement,

Exhibit 16 [R. 633], because the alleged invention was

reduced to practice (i. e., “made, developed, or perfected”’)

while Garbell was employed by Consolidated, as contem-

plated by the Invention Agreement. Such holding is

manifestly correct and is fully supported by the evidence.

Petitioners argue (pp. 7-9, 17, 50) that, because Gar-

bell did not adequately comply with his obligations under

the Invention Agreement as to disclosure to Consolidated

of the alleged invention in suit, Consolidated acquired no

shop-right or license under the Invention Agreement. This

ae em

is a curious contention. How a party to a contract could

defeat the rights of the other contracting party thereto

simply by failing or refusing to comply with his obliga-

tions does not appear to us. In any event, the acquisi-

tion of a shop-right by Consolidated under the Inven-

tion Agreement is not conditioned in any way upon Gar-

bell disclosing the alleged invention to Consolidated, and

since the invention was reduced to practice while Gar-

bell was so employed the requirements of the Agreement

were satisfied at least insofar as the shop-right to Con-

solidated is concerned and the shop-right is absolute.

However, Garbell made a disclosure of the alleged in-

vention by his paper, Exhibit D [R. 775], to the Patent

Department of Consolidated, exactly as required by Para-

graph 1 of the Invention Agreement. Furthermore, Gar-

bell expressly characterized such “paper” as an “official

disclosure of invention” by his accompanying memo, Ex-

hibit E [R. 789]. Thus, Garbell himself construed his

alleged invention in suit as falling within the terms of

the Invention Agreement. The actions of the parties

construing a contract should be followed by the courts

in construing a contract. (District of Columbia v. Gal-

laher, 124 U. S. 505, 31 L. Ed. 526, 527; Mitau v. Rod-

dan, 149 Cal. 14, 84 Pac. 145, 6 L. R. A. 275, 281.)

The only question seriously raised by petitioners in

whether the alleged invention in suit was “made, devel-

oped or perfected” [Par. 1 of the Invention Agreement]

while Garbell was employed by Consolidated, and this is

a purely factual question.

The Court of Appeals [R. 1146] held that an inven-

tion is not “made, developed, or perfected until reduced

to practice,” citing the authority of this Court and other

courts. Petitioners admit (p. 28) that this statement of

the law is correct in many types of patent cases, includ-

ing those in which the defendants are “seeking any title

to or interest in the invention or patent.” Petitioners seek

to avoid the application of such legal principle to the facts

of this case by contending that here the respondents are

not “seeking any title to or interest in the invention or

patents” but without the citation of any authority in

support thereof. Such contention of petitioners is obvi-

ously without merit. Respondents claim a non-exclusive

license (shop-right) under the Garbell patent in suit,

and, obviously, a non-exclusive license is a limited in-

terest in the monopoly of the patent in suit. (Waterman

v. Mackenzie, 138 U. S. 252, i1 S. Ct. 334, 34 L. Ed.

923; Bloomer v. McQuewan, 55 U. S. 539, 14 L. Ed.

532.)

Petitioners do not contend that Garbell’s alleged in-

vention in suit was actually reduced to practice prior to

his employment by Consolidated. They could not do sO,

because there is no evidence to support such a conten-

tion and, in fact, Garbell stated in effect that up vstil

the time of trial of this action neither he nor anyone else

with his consent had ever built an airplane wing em-

bodying his alleged invention in suit [R. 238-239].

Petitioners attempt to avoid the consequences of the

above principle of law stated by the Court of Appeals,

by contending (pp. 11 and 44) that Garbell’s mere con-

ception or oral disclosure of the invention prior to his

employment by Consolidated was a “constructive reduc-

tion to practice” of the invention. In support of this

contention, petitioners cited Curtiss Aeroplane & Motor

Corp. v. Janin, 278 Fed. 454 (C. A. 2d), which is not

in point, as in that case the Court actually held that

even the filing of a patent application was not a reduc-

tion to practice.

The case of Heywood-Wakefield Co. v. Small, 87 F.

2d 716 (C. A. Ist), largely relied upon by petitioners,

is clearly distinguishable on its facts from the present

case and is not in point. In that case, the inventor Small

on his own time conceived and built an adequate model

of the invention there in suit, and, the Court held, that

no further testing of any kind was required to demon-

strate that the invention was in practical commercial form.

That is not true in the present case because, as plainly

stated in the Garbell patent in suit and Garbell’s admis-

sions (p. 7, supra), it was the extensive building and

testing of models of the “Two-Engine Tailless” and the

XB-46 by Consolidated that “demonstrated convincingly

that each of the objects of this invention has been fully

achieved.” Furthermore, as pointed out by the Court

in the Heywood-Wakefield case, supra, Small did not

stand by for a long period of time and permit his em-

ployer to use his invention without protest (as in Gill v.

United States, for example). Largely determinative of

the case was the fact that the inventor Small immediately

upon disclosure of his invention to his employer demanded

payment for the employer’s use of it, and at all times there

was a controversy between Small and his employer as to

whether Small or the employer was to have the rights

to the invention. No such situation is presented in this

action, as here Garbell at no time while he was eriployed

by Consolidated made any claim that the alleged inven-

tion here in suit was his separate property or that he

was, entitled to any payment from Consolidated for its

extensive use and planned use of the alleged invention

in its “Two-Engine Tailless,” XB-46, and Model 110 air-

—]9—

Planes in all of which Garbell had expressly suggested

that Consolidated use the alleged invention in suit.

There is no authority for such a contention as_peti-

tioners urge and it is contrary to all of the established law

to the effect that an invention is not made (1. e., reduced

to practice) until embodied in some concrete physical

form. As stated by this Court in Clark Thread Co. v.

Willimantic Linen Co., 140 U. S. 481, 11 S. Ct. 846, 35

L. Ed S27:

“It is evident that the invention was not completed

until the construction of the machine. A conception

of the mind is not an invention until represented in

some physical form .. .”

The distinction between conception and reduction to

practice of an invention, and the necessity of the inven-

tion being embodied in tangible form, was reiterated by

this Court in United States v. Dubilier C ondenser Corp.,

289 U. S. 178, 53 S. Ct. 554, 77 L. Ed. 1114, 1119, as

follows :

“It [the invention] is the result of an inventive

act, the birth of an idea and its reduction to practice;

the product of original thought; a concept demon-

strated to be true by practical application or embodi-

ment in tangible form. Clark Thread Co. v. Will-

mantic Linen Co., 140 U. S. 481, 489, 35 L. Ed.

$21, 525, 11 S. Ce. 846 T. H. Symington Co. v.

National Castings Co., 250 U. S. 383, 386, 63 L.

Ed. 1045, 1049, 39 S. Ct. 542; Pyrene Mfg. Co. v.

Boyce (C. C. A. 3rd), 292 Fed. 480, 481.” (Em-

phasis added.)

The evidence, as reviewed above (p. 47 ), plainly

shows that’ actual models of wings for the “Two-Engine

Tailfess” airplane, incorporating Garbell’s alleged inven-

—20—

tion in suit were made by Consolidated and extensively

tested by it with the full knowledge and consent of Gar-

bell during his employment. Consolidated’s reports signed

by Garbell and covering such tests showed that such

tests demonstrated the practicability of his alleged inven-

tion, and the Garbell patent in suit plainly states in ef-

fect that the models and tests made by Consolidated “dem-

onstrated convincingly that each of the objects of this

invention has been fully achieved” (see p. 7, supra).

In addition, Garbell in his suggestion dated March 2,

1945, that Consolidated employ his alleged invention in

suit in its Model 37 airplane, Exhibit 25 [R. 666], ex-

pressly admitted that his alleged invention had previously

been embodied in the various earlier airplane designs of

Consolidated, as follows:

“The ‘tri-section wing’ principle which has been -

successfully applied to the Tailless design, the ex-

ecutive transport, and the XB-46 design, yields sev-

eral satisfactory wings.”

Such Exhibit 25 was held by the District Court to be

a disclosure of the alleged invention in suit to Consoli-

dated [R. 40]. In view of its express statement, quoted

above, by Garbell at the time and on the spot and long —

prior to any controversy, there can be no doubt that —

Garbell’s alleged invention had been embodied by Con-

solidated in its “Two-Engine Tailless,” its executive trans-

port, and its XB-46 bomber at least as early as March

2, 1945, with Garbell’s full knowledge. Obviously, Gar- —

bell’s alleged invention was thereby reduced to practice —

nln:

by Consolidated while he was employed by it and with

his full knowledge and approval.

Petitioners argue (pp. 9-10) that while inventions for

processes, machines, or designs may require embodiment

in physical form before they are complete, the alleged in-

vention here in suit “is not one which calls for a process

or machine or design.” The Garbell patent in suit was

obtained under old Section 31 of Title 35, United States

Code, which made provision for patents only on an “art,

machine, manufacture, or composition of matter . . .

[and] asexually reproduced . . . plant.” If the air-

plane wing of the Garbell patent here in suit is not a

“machine” within the statute, we do not know what it

is. Certainly, it is not an art, manufacture, composition

of matter, or a plant. We suggest that petitioners’ ad-

mission (p. 10) that inventions for machines “usually

need work and trial-and-error methods, models need to

be made,” etc., applies directly to a complex structure

such as Garbell’s alleged invention in suit.

It is thus plain that: (a) there is clear evidence in the

record to support the decision of the Court of Appeals

that the alleged invention in suit was reduced to prac-

tice while Garbell was employed by Consolidated and is

therefore within the Invention Agreement and respon-

dents have an express shop-right with respect thereto:

and (b) there is no evidence to support the Finding of

“made” (as distinguished from its “eonception”’), prior to

Garbell’s employment by Consolidated, and such Finding

Patent in Suit.

The Court of Appeals further held [R. 1147] that re-

spondents have an implied in law license (4. @., shop-right)

under the Garbell patent in suit, in view of the fact that

Garbell’s alleged invention was reduced to practice by

hir (if ever) while he was employed by Consolidated

“by and through the use of materials and facilities of

Consolidated and time for which he was paid by Con-

solidated.” This implied in law license, the Court of

Appeals pointed out, existed irrespective of the Invention

Agreement.

That the alleged invention in suit was reduced to prac-

tice while Garbell was employed by Consolidated has

been pointed out above (p. 16-20).

Petitioners contend, in effect (pp. 12, 45), that there

is no evidence in the record that the work done by Con-

solidated with regard to Garbell’s alleged invention while

he was employed by it cost Consolidaied anything. Such

contention is either flatly wrong, highly misleading, or —

we misunderstand petitioners’ argument. As pointed out

ers, Strohmeyer and Bayless) devoted company time to —

utilizing. and testing Garbell’s“alleged invention in suit

[R. 309, 697, 1007] while he was likewise so ,

Could any court be asked seriously to believe that all

such construction: work: and the extensive wind-tunnel

testing of the models was without substantial cost to

Consolidated?) We think not. In any event, Garbell

freely admitted that everything in issue done at Con-

solidated' was done at its'expense, as follows:

“The Court: As a matter of fact, all the experi-

ments, or whatever you call them, these tests, were

done as a part of the work and progress of the con-

cern, isn’t that true?

The Witness: (Pause.)

The Court: Do you know what I mean by ‘work

and progress’? That is used in engineering, it is

also used in literature. When you have a thing in

a preliminary stage and you just keep on working

on it.

The Witness: Yes; your Honor, but—

The Court: I don’t mean to catch you by the

Guestion.

The Witness: No, I want to make myself very

clear though:

The:Court: I am trying to shorten this: by get-

ting, an answer that will end it. Whatever was. done,

was done at company expense, assuming that it re-

quired expense, these experiments, these wind tunnel

‘tests, or whatever’ was done:

Mr. Gerlach: The preparation.

The Court: The preparation: of the report or

whatever was.done,.was.done on company. time,.and

where it required money, with company money, isn’t

that true?

_ The Witness: Yes, but’ especially during all of

‘the: early suggestions: and urgings they were: com+

.. pletely outside: of my assignments, my direct. work

—24—

The Court: Work that you did yourself?

The Witness: Yes.

The Court: I am not interested in that. I know

what is bothering you. I know your type very well.

What is bothering you is the idea that all of this

was conceived before this was done, isn’t that true?

The Witness: And it was proposed and sug-

gested outside of the work assignments in a general

sense.

The Court: That is all right.

The Witness: I wasn’t working on those at all.

The Court: But whatever they did, whether they

gave directions or not, they did it at their expense,

whatever the expense was, isn’t that true?

The Witness: It was theirs or the contracting

agencies.” [R. 264-265, and see 262-263.]

We therefore suggest that, as stated by the Court of

Appeals, if Garbell’s alleged invention was ever made,

developed or perfected it was done so while he was em-

ployed by Consolidated with its time, materials, and fa-

cilities at its expense and with his full knowledge and

consent.

In finding such implied in law license in respondent

Consolidated the Comt of Appeals relied upon a number

of decisions of this Court in. footnote 1 [R. 1143] and

footnote 9 [R. 1147]. Petitioners do not question the —

applicability of such decisions to the facts of this action, —

citing (p. 18) Gill v. United States, 160 U. S. 426, 16 S.

Ct. 322, 40 L. Ed, 480; United States v. Dubilier Com

denser Corp., 289 U. S. 178, 53 S. Ct. 554, 77 L. Ed —

1114; and Solomons v. United States, 137 U. S. 342, il

S. Ct. 88, 34 'L. Ed. 667. Petitioners quote with approval

from: Gill'v. United States, supra, as follows:

“The principle is really an application or outgrowth

of the law of estoppel in pais, by which a person

looking on and assenting to that which he has power

to prevent is held to be precluded ever afterwards

‘from maintaining an action for damages.”

‘The. applicability of such legal principle stated in the

Gill. case, supra, to the facts of this action is obvious.

Here, Garbell looked on, assented to, and encouraged

Consolidated to adopt and use his alleged invention in

suit, it allegedly did so and is now sued for patent in-

fringement as a result of such use. If there ever has

been a situation where the doctrine of estoppel in pais

should be applied it is in this case.

Petitioners (pp. 17-18, 27) attempt to define the “shop-

right_rule” but such definition does not consider the, plain

language of this Court’s decisions which petitioners cite

and rely: upon, inserting additional requirements that such

decisions of this Court do not mention. The true “shop-

right rule” was stated by this Court in the Gill case, supra,

at page 429, as follows:

‘“{Can]an employee paid by salary >r:wages,:who

.devises ian improved:method of doing his work, using

.the, property or labor of his employer to put his in-

vention into practical form, and assenting to the

‘use of such improvements by ‘his employer, ;

‘by taking out a patent upon ‘such invention, ‘recover

<a royalty or, other: compensation for :such .use. .In

a serics of cases . . . we have held that this

could not be done.”

The facts of this case are clearly within the shop-right

rule as applied by this Court in Gill v. United States,

supra; United States v. Dubilier C ondenser Corp., supra;

McClurg v. Kingsland, 1 How. 202; Solomons v. United

States, supra; and Lane & Bodley Co. v. Locke, 150 U.

S. 193. Upon the authority of such cases, and the addi-

tional decisions cited by the Court of Appeals in its

opinion, Consolidated plainly has a shop-right under the

Garbell patent here in ‘suit and the Petition should be

denied.

Also directly in point is the case of Tin Decorating Co.

v. Metal Package Corporation, 29 F. 2d 1006 (D. Ct.,

N. Y., 1928), affd. at 37 F. 2d 5 (C. C. A. 2d), and

cert. den. at 281 U. S. 759, 74 L. Ed. 1168, in which

an invention was conceived by an employee prior to his

employment but reduced to practice by the employer dur-

ing employment and upon which a patent application was

filed by the employee after his employment was terminated.

(To the same effect, Elzilaw Co. v. Knoxville Glove Co.,

22 F. 2d 962 (C. C. A. 2d).)

F. Conclusion.

_ This is a run-of-the-mill action for patent infringe- |

ment. The. public interest has been served by the deci-

sion of the Court of Appeals holding that the respondents _

are free of the monopoly of the patent in suit and insur-

ing that the Convair airplanes in wide commercial service 4

may contintte to serve without interruption the air-travel- :

ing public.

—27-—

Petitioners’ Brief is almost entirely a verbatim copy

of their petition for rehearing addressed to the Court of

Appeals, and advances here no question of law or fact not

considered by the Court of Appeals.

The only questions raised by the Petition are purely

factual. There is no question presented by the Petition

: requiring or deserving the consideration of this Court.

It is submitted that the Petition should be denied.

Respectfully submitted,

Forp W. Harris, Jr.,

Attorney for Respondents.

Rosert B. Watts,

Frep GERLACH,

Of Counsel.

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