Continental Paper Bag Company v. Eastern Paper Bag Company

This is a bill in equity to restrain the infringement of letters patent No. 558,969, issued to William Liddell for an improvement in paper bag machines, for making what are designated in the trade as self-opening square bags. The claims in suit do not include mechanism for making a complete bag, but only mechanism for distending one end of a tucked or bellows-folded paper tube made by other mechanism, and folding it down into a form known in the art as the 'diamond fold.' This fold is flattened and pasted by other mechanism and forms a square bottom to the bag.

The bill is in the usual form and alleges infringement of the claims by the Continental Paper Bag Company, hereafter called the Continental Company, and prays for an accounting and an injunction.

The answer interposed the defense of nonjurisdiction of a court of equity, noninfringement of the Liddell patent by defendant (Continental Company), and want of invention.

The allegation of the answer as to the jurisdiction of the court is as follows:

'The defendant says, on information, advice, and belief, that a court of equity has no jurisdiction to grant any prayer of the bill of complaint, even if the said Liddell patent, No. 558,969, were valid, and even if the defendant's paper bag machines were to be held to infringe that patent; because the said patent, No. 558,969, is a mere paper proposition which the complainant has never put into effect or use, and because it is contrary to equity to suppress a useful and established business, like that which the defendant is prosecuting with its paper bag machines, at the request of a complainant which simply owns one paper bag machine patent that has never been employed by that complainant in any way in any paper bag machinery, and because the complainant in this case has a plain, adequate, and complete remedy at law for any infringement which may have been done upon Liddell letters patent, No. 558,969.'

The circuit court adjudged the patent valid as to the first, second, and seventh claims thereof; that the Eastern Paper Bag Company was the owner of the letters patent; that Liddell was the original and first inventor of the improvements described in the claims; and that the Continental Company had infringed the same. It was also adjudged that the Eastern Company recover of the Continental Company the profit the latter had made or received by the infringement. An account was ordered and a perpetual injunction decreed. 142 Fed. 479. The decree was affirmed by the circuit court of appeals. 80 C. C. A. 407, 150 Fed. 741. This certiorari was then granted.

Mr. Albert H. Walker for petitioner.

[Argument of Counsel from pages 407-410 intentionally omitted]

Messrs. Francis T. Chambers, Samuel R. Betts, James J. Cosgrove, and Betts, Sheffield, & Betts for respondent.

[Argument of Counsel from Pages 410-413 intentionally omitted]

Mr. Justice McKenna delivered the opinion of the court: