Stonite Products Company v. Melvin Lloyd Company/Opinion of the Court

The only question presented for our determination is whether Section 48 of the Judicial Code, 28 U.S.C. § 109, 28 U.S.C.A. § 109, is the sole provision governing the venue of patent infringement litigation or whether that section is supplemented by Section 52 of the Judicial Code, 28 U.S.C. § 113, 28 U.S.C.A. § 113. Section 48 gives jurisdiction of suits for patent infringement to the United States district courts in the district of which the defendant is an inhabitant or in any district in which the defendant shall have committed acts of infringement and have a regular and established place of business. Section 52 permits suits, not of a local nature, against two or more defendants residing in different judicial districts within the same state to be brought in either district.

Petitioner, Stonite Products Company, an inhabitant of the Eastern District of Pennsylvania without a regular and established place of business in the Western District of that State, was sued jointly with Lowe Supply Company, an inhabitant of the Western District, in the Western District for infringement of Patent No. 1,777,759 for a boiler stand. Petitioner was served with process in the Eastern District, entered a special appearance in the action in the Western District, and moved to dismiss or quash the return of service because venue was laid in the wrong district. The district court granted the motion and dismissed the cause as to petitioner. 36 F.Supp. 29. The Circuit Court of Appeals reversed. 119 F.2d 883. We granted certiorari because of an asserted conflict with Motoshaver, Inc. v. Schick Dry Shaver, Inc., 9 Cir., 100 F.2d 236.

We hold that Section 48 is the exclusive provision controlling venue in patent infringement proceedings.

Section 48 is derived from the Act of March 3, 1897, c. 395, 29 Stat. 695, and its scope can best be determined from an examination of the reasons for its enactment.

Section 11 of the Judiciary Act of September 24, 1789, c. 20, 1 Stat. 79, permitted civil suits to be brought in the federal courts against a person only in the district of which he was an inhabitant or in which he was found at the time of serving the writ. That section applied to suits for patent infringement. Chaffee v. Hayward, 20 How. 208, 216, 15 L.Ed. 804, 851; Allen v. Blunt, Fed.Cas.No.215, 1 Blatchf. 480. The Act of March 3, 1875, c. 137, 18 Stat. 470, retained the provision allowing suit wherever the defendant could be found. The abuses engendered by this extensive venue prompted the Act of March 3, 1887, c. 373, 24 Stat. 552, which as amended by the Act of August 13, 1888, c. 866, 25 Stat. 433, permitted civil suits to be instituted only in the district of which the defendant was an inhabitant, except that in diversity jurisdiction cases suit could be started in the district of the plaintiff's or the defendant's residence. The substance of those provisions was reenacted as Section 51 of the Judicial Code (28 U.S.C. § 112, 28 U.S.C.A. § 112).

After the holding of In re Hohorst, 150 U.S. 653, 14 S.Ct. 221, 225, 37 L.Ed. 1211, that the Act of 1887 as amended did not apply to a suit against an alien or a foreign corporation 'especially in a suit for the infringement of a patent right', the lower federal courts became uncertain as to the applicability of the Act of 1887 to patent infringement proceedings. In explanation of Hohorst's case it was said Re Keasbey & Mattison Co., 160 U.S. 221, 230, 16 S.Ct. 273, 275, 40 L.Ed. 402, that 'It was a suit for infringement of a patent right, exclusive jurisdiction of which had been granted to the circuit courts of the United States * *  * ; and was therefore not affected by general provisions regulating the jurisdiction of the courts of the United States, concurrent with that of the several states'. Thereafter the lower federal courts for the most part took the position that the Act of 1887 as amended did not apply to suits for patent infringement, and that infringers could be sued wherever they could be found.

The Act of 1897 was adopted to define the exact jurisdiction of the federal courts in actions to enforce patent rights and thus eliminate the uncertainty produced by the conflicting decisions on the applicability of the Act of 1887 as amended to such litigation. That purpose indicates that Congress did not intend the Act of 1897 to dovetail with the general provisions relating to the venue of civil suits, but rather that it alone should control venue in patent infringement proceedings.

Section 52 is derived from R.S. § 740, which in turn stems from the Act of May 4, 1858, c. 27, 11 Stat. 272, a general act intended to do away with the insertion of special provisions preserving state-wide venue in acts dividing a state into two or more judicial districts, and the Act of February 24, 1863, c. 54, § 9, 12 Stat. 662. Respondents insist that Section 52 applies to patent infringement suits because it antedates Section 48, excludes from its purview only suits of a local nature, and is consistent with and complementary to Section 48 since it deals with the problem of venue in the geographical sense rather than in terms of specified classes of litigation. We cannot agree.

Even assuming that R.S. § 740 covered patent litigation prior to the Act of 1897, we do not think that its application survived that Act, which was intended to define the exact limits of venue in patent infringement suits. Furthermore, the Act of 1897 was a restrictive measure, limiting a prior, broader venue. General Elec. Co. v. Marvel Rare Metals Co., 287 U.S. 430, 434, 435, 53 S.Ct. 202, 204, 77 L.Ed. 408; Bowers v. Atlantic, G. & P. Co., C.C., 104 F. 887; Cheatham Electric Switching Device Co. v. Transit Development Co., C.C., 191 F. 727. Thus there is little reason to assume that Congress intended to authorize suits in districts other than those mentioned in that Act.

The reenactment of the Act of 1897 as Section 48, and of R.S. § 740 as Section 52 of the Judicial Code by the Act of March 3, 1911, c. 231, 36 Stat. 1100, 1101, is not indicative of any Congressional understanding that the two sections are complementary. Quite the contrary, for Section 52 appears in the Judicial Code as an exception to Section 51, the general venue provision derived from the Act of 1887, as amended. See Camp v. Gress, 250 U.S. 308, 315, 39 S.Ct. 478, 481, 63 L.Ed. 997. Section 51 is, of course, not applicable to patent infringement proceedings. General Elec. Co. v. Marvel Rare Metals Co., supra. Since Section 48 is wholly independent of Section 51, there is an element of incongruity in attempting to supplement Section 48 by resort to Section 52, an exception to the provisions of Section 51. Cf. Connecticut Fire Ins. Co. v. Lake Transfer Corp., 2 Cir., 74 F.2d 258.

Reversed.