Newton v. Buck

72 Fed. 777
Decided Circuit Court of Appeals, Second Circuit
Disposition
reversed
full scope · unanimous
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Court
Circuit Court of the United States for the Northern District of New York
Decided
Judge
PEE CURIAM
Posture
Decree for complainant (Addie Newton) after trial
Defendant (1)
James A. Buck
George A. Mosher
v.
Complainant/Plaintiff (1)
Addie Newton
Ward & Cameron (Walter E. Ward, of counsel)
Other parties: A. H. Newton & Co. — Firm receiving initial patent transfer, Alfred H. Newton — Assignee from firm, James J. Dooley — Assignee from Alfred H. Newton, Vermilyea — Purchaser from receiver

Overview

The decree is reversed, with costs to the appellant, and with instructions to the circuit court to dismiss the bill.

Case summary

Addie Newton sued James Buck for patent infringement, claiming title through chain of assignments originating from Buck's 1889 transfer to a firm, which inadvertently omitted the patent from the written agreement. Alfred H. Newton acquired equitable title (right to reform the agreement) but in 1891, a receiver was appointed for his property in New York proceedings supplementary to execution. The receiver sold Newton's interest to Vermilyea, who later reassigned to Buck. Newton's subsequent 1893 assignment to Dooley (and then to Addie Newton) occurred after the receiver took title. The Circuit Court of Appeals held that the equitable title vested in the receiver in 1891, so Newton's later assignment passed nothing. The court reversed the trial court's decree for complainant and ordered dismissal of the bill.

Abstract

Plaintiff sued for patent infringement, claiming title through a chain of assignments from a defective 1889 transfer that omitted the patent, entitling the prior holder to reform the agreement. A receiver appointed in 1891 for the holder's property sold the equitable interest to defendant, who later received a reassignment, rendering the holder's subsequent assignment ineffective as it passed no title. The appellate court reversed the trial decree in plaintiff's favor and ordered dismissal of the bill.

Opinion of the court

Majority
opinion
PEE CURIAMjoined by LACOMBE, SHIPMAN
  • Both parties intended to include patent in 1889 transfer but it was omitted by inadvertence
  • Alfred H. Newton only acquired equitable title (right to reform)
  • Proceedings supplementary to execution transferred equitable title to receiver in 1891
  • Newton's 1893 assignment occurred after receiver took title, so passed nothing
  • Complainant's title through subsequent assignments is invalid

Jurisdiction

not challenged
Subject matter
Patent infringement suit in equity
Jurisdictional facts
  • Suit filed in Circuit Court of the United States for the Northern District of New York
  • Appeal to Circuit Court of Appeals, Second Circuit

Procedural posture

Posture at trial
Decree for complainant (Addie Newton) after trial
Posture on appeal
Direct appeal by defendant (James A. Buck) from decree
Preserved issues
  • Title to patent through assignments and receiver sale

Legal categories

Business

Case record

Full case name
NEWTON v. BUCK
Docket number
72 Fed. 777
Court
Circuit Court of Appeals, Second Circuit
Trial court
Circuit Court of the United States for the Northern District of New York
Decided
Opinion author
PEE CURIAM
Opinion type
per curiam
Precedential status
precedential
Judges on panel
LACOMBESHIPMAN

Issues & holdings

1
Issues raised
1
reversed
3
Holdings
Standard of review

de novo

Disposition rationale

Complainant's title derived from assignment that occurred after receiver had taken equitable title, so she took nothing

Preservation

Issue preserved for review

Holdings of the court

Complainant's title to patent
Complainant Addie Newton had no title to patent No. 301,087
Alfred H. Newton only had equitable title (right to reform agreement), which vested in receiver in 1891 proceedings. His 1893 assignment to Dooley occurred after receiver took title, so subsequent assignments to complainant passed nothing.
unanimousbinding precedent
Effect of proceedings supplementary to execution
Proceedings supplementary to execution under New York law transfer equitable title to receiver
Such proceedings are substitute for creditors' bill and give receiver title to all property—equitable and legal—of judgment debtor. Patent can be reached by creditors' bill per Ager v. Murray.
unanimousbinding precedent
Transfer of patent interests
Equitable title to patent passes without formal statutory assignment
Legal title requires statutory assignment, but equitable title (right to reform) can transfer through receiver sale and assignments.
unanimousbinding precedent

Error analysis

  • Trial court found complainant had title to patent — procedural · error foundError was not harmless as it went to core issue of title · not harmless

Statutory interpretation

1
Statute
New York Code provisions for proceedings supplementary to execution
Question
Whether such proceedings transfer equitable title to patents
Court's reading
Proceedings are substitute for creditors' bill and transfer all property—equitable and legal—to receiver
Canons applied
plain meaning

Standards of review

  • Title to patent through assignments and receiver sale — de novo Legal question of title interpretation reviewed de novo

Timeline

9
Events
3,960
Days, incident to ruling
—
Span
factual eventcited in opinion

Letters patent No. 301,087 issued to defendant James A. Buck

factual eventcited in opinion

Defendant Buck transferred patents to firm A. H. Newton & Co., but patent in suit was omitted from written agreement by inadvertence

Created equitable title in Newton for the omitted patent

James A. Buck · A. H. Newton & Co.
factual eventcited in opinion

Firm A. H. Newton & Co. assigned rights to Alfred H. Newton

A. H. Newton & Co. · Alfred H. Newton
factual eventcited in opinion

Receiver sold Newton's interest in patent to Vermilyea pursuant to court order

Outcome: Vermilyea acquired Newton's equitable title

Transfer cut off Newton's subsequent assignments

Receiver · Vermilyea
procedural eventcited in opinion

Receiver appointed for Alfred H. Newton's property by New York Supreme Court in proceedings supplementary to execution

Outcome: Receiver qualified and took title to Newton's property

Equitable title to patent vested in receiver

Alfred H. Newton · New York Supreme Court trial court
factual eventcited in opinion

Alfred H. Newton assigned his interest to James J. Dooley

Assignment occurred after receiver had taken title

Alfred H. Newton · James J. Dooley
factual eventcited in opinion

James J. Dooley assigned to complainant Addie Newton

James J. Dooley · Addie Newton
filingcited in opinion

Complainant Addie Newton filed bill for infringement in Circuit Court

Addie Newton trial court
factual eventcited in opinion

Vermilyea assigned his interest back to defendant Buck

Defendant regained equitable title he originally held

Vermilyea · James A. Buck

Facts & evidence

Key facts

8 facts
  1. Defendant Buck transferred patents to firm A. H. Newton & Co. in March 1889, but patent No. 301,087 was omitted from the written agreement by inadvertence
  2. Firm assigned rights to Alfred H. Newton in August 1889
  3. Alfred H. Newton assigned to James J. Dooley in March 1893
  4. Dooley assigned to complainant Addie Newton in February 1894
  5. In December 1891, a receiver was appointed for Alfred H. Newton's property by New York Supreme Court in proceedings supplementary to execution
  6. Receiver sold Newton's interest in the patent to Vermilyea in April 1891
  7. Vermilyea assigned interest back to defendant Buck in May 1895
  8. Bill for infringement filed in January 1895

Procedural history

3 steps
  1. Suit filed in Circuit Court for Northern District of New York
  2. Trial court entered decree for complainant
  3. Defendant appealed to Circuit Court of Appeals, Second Circuit

Evidence in the record

Testimonial
  • Evidence that both parties intended to include patent in 1889 agreement (described as 'overwhelming')
Documentary
  • Written agreement of March 1889 transferring patents
  • Assignments from firm to Alfred H. Newton (August 1889)
  • Assignment from Alfred H. Newton to James J. Dooley (March 1893)
  • Assignment from Dooley to Addie Newton (February 1894)
  • Receiver's sale to Vermilyea (April 1891)
  • Assignment from Vermilyea to Buck (May 1895)
  • Letters patent No. 301,087

Objects of relevance

Letters patent No. 301,087 (tangible patent document)

Authorities

Cited authorities (3)

Fenner v. Sanborn, 37 Barb. 610
appliedprecedent
Cited for proposition that court has equity powers in supplementary proceedings to reach property out of state
Ager v. Murray, 105 U. S. 126
followedprecedent
Cited for holding that patent can be reached by creditors' bill to satisfy judgment
Wilder v. Gayler, 10 How. 498
appliedprecedent
Cited for principle that legal title to patent requires statutory assignment

Statutes

  • New York Code provisions for proceedings supplementary to execution
  • Patent assignment statutes requiring formal transfer for legal title

Standards & doctrines

  • de novo review of legal title questions
  • Equitable title doctrine for patents

Legal principles applied

  • Proceedings supplementary to execution have same force as creditors' bill
  • Receiver takes title to all property—equitable and legal—of judgment debtor
  • Patent can be applied to satisfy judgment through equitable proceedings
Index terms57
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Action type
reversed
Target
trial court decree for complainant
Appealed from
Circuit Court of the United States for the Northern District of New York
Context
Decree reversed because complainant lacked title to patent due to receiver taking equitable title first
Scope
full
Further instructions
Dismiss the bill
Disposition vote
unanimous
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Parties
Judges
LacombeShipman
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