suits, seeking injunctions, etc., and the court dismissed the bill on demurrer for want of equity. Shoemaker v. South Bend Spark Arrester Co.,80 follows Emack v. Kane, and holds that the court has power to enjoin interference with property rights in patents by false and malicious claims of title, threats to collect royalties from plaintiff's customers, etc. This case is often cited in connection with Casey v. Cincinnati Typographical Union,81 in which a newspaper was enjoined from publishing boycott notices, and Warren Featherbone Co. v. Landauer,82 and Commercial Acetylene Co. v. Avery Portable L. Co.83 On the other hand, in Marx & H. J. Clothing Co. v. Watson,84 the court refused to restrain the publication of circulars issued to boycott the business of individuals, no matter how unjustifiable and injurious the publication may be. In Allegretti Chocolate Cream Co. v. Rubel,85 the court refuses to follow Emack v. Kane, supra, because in that case intimidation by defendants of plaintiff's customers was by threats of suit, which defendants did not intend to prosecute, and there was no such allegation in the Allegretti case. This was on appeal from an order granting a preliminary injunction against a circular. § 265. Theory that Threats of Prosecution Must be Shown to Warrant Issuance of Injunction. In the cases in which the doctrine of Emack v. Kane has been followed, threats have been made and widely disseminated, to prosecute customers of the plaintiff for infringement, it being shown that the threats were made with fraudulent intent to break up plaintiff's business, and it would seem that the court has regarded the proof of such threats as necessary to the right to demand an injunction under this doctrine. The jurisdiction of equity in these cases is negatively defined in Edison v. Thomas A. Edison, Jr., etc., Co.86 thus: "The case 80 135 Ind. 471-1893; 35 N. E. 280; 22 L. R. A. 332. The facts were these: Defendant made and sold "Wizard Ink Tab 81 45 Fed. 135-1891 (C. C. Ohio); lets" and a device called a "Magno 12 L. R. A. 193, note. 82 151 Fed. 133-1903 (C. C. Wis.). 83 152 Fed. 645-1906 (C. C. Wis.). 84 168 Mo. 133–1901; 67 S. W. 391; 56 L. R. A. 951. 85 83 Ill. App. 558-1898. * 128 Fed. 957-1904 (C. C. Del.). Electric Vitalizer," and complainant alleged that through the name adopted by the defendant, the names given to its goods, and the form of its advertisements, it was misleading the public into supposing that its worthless devices were the invention of complain now in hand, being one merely of libel or defamation of business reputation, unaccompanied by threats, intimidation or coercion, or by any direct attack upon property or conduct of business, or by any direct or indirect creation of liability on the part of the complainant, is not within the equitable jurisdiction of this court." Where circulars were distributed stating that the goods of the plaintiff infringed a patent, and threatened all persons purchasing complainant's goods with suit, and defendant instituted a collusive and fraudulent suit and obtained in it a decree apparently supporting his patent, the court enjoined the use of this decree to injury of complainant. "Complainant has no adequate remedy at law. * It cannot be said that it should lie by and wait the slow and uncertain processes of a suit for damages for its redress. * The complainant is rightfully operating under such patent, and it has no remedy adequate for the fraud and wrong perpetrated upon it, except as aided by a court of equity." 87 Flint owned patents for a smoke-preventing device. Plaintiffs alleged that they were trying to sell the device to the M Company, and that defendant maliciously served notice on the M Company that plaintiff's device infringed patents owned by defendant, and that if the M Company used plaintiff's device, it would be liable for costs and damages. Plaintiffs also averred that defendant served a like notice on others; that plaintiffs were financially responsible, and that they believed defendant did not intend to sue them, or their customers, but intended to continue the false notices. Injunction was refused, and Black, J., said (p. 501): "We live under a written constitution which declares that the right of trial by jury shall remain inviolate; and the question of libel or no libel, slander or no slander, is one for the jury to determine. Such was certainly the settled law when the various constitutions of this state were adopted, and it is all-important that the right thus guarded should not be disturbed. It goes hand ant, and thus injuring his reputation and his business as an inventor. This was treated as a species of trade libel that would not be restrained. See also these cases in which Emack v. Kane has been cited: Kelley v. Ypsilanti Dress Stay Co., 44 Fed. 23; Coeur D'Alene Mining Co. v. Miners Union, 51 Fed. 260; New York Filter Co. v. Schwarzwalder, 58 Fed. 579. 87 Grand Rapids School Furniture Co. v. Haney School Furniture Co., 92 Mich. 558-64-1892; 52 N. W. 1009; 16 L. R. A. 721. in hand with the liberty of the press and free speech. For unbridled use of the tongue or pen the law furnishes a remedy. In view of these considerations a court of equity has no power to restrain a slander or libel, and it can make no difference whether the words are spoken of a person or his property." The court then held that the element of "unfair competition which results in the loss of business, owing to the dread men have of law suits,' will not give equity jurisdiction, because libel and slander are generally accompanied with loss of business. No mention is made of Emack v. Kane, although it would seem in point and was cited in appellant's brief.88 This case may be distinguished from those holding that an injunction is warranted against libel and slander, in that there is no continuing wrong here, no irreparable injury the damage from which it is impossible to assess. An action at law might give damages that would compensate the loss of the plaintiff, but there are many cases where the loss cannot be estimated. § 266. Intent to Intimidate Customers, Not to Fairly Warn Them, is a Necessary Element of this Kind of Proceeding to Enjoin. The circumstances attending an issue of circulars threatening litigation should, to warrant interference, indicate bad faith. "The question whether the patent owner is acting in good faith in advertising his claims to the manufacturer's customers by circulars or letters, can seldom be determined from the contents of the communication alone, and, like all questions of intent, must generally be determined by the extrinsic facts." 89 For instance, the National Harrow Company sent out numerous circulars and letters claiming the Adriance Company were infringing their patents, and threatening with suit all dealers selling the Adriance harrow. The lower court held that all statements in said circulars and letters were true, and declined to enjoin them. The court said: "When the manufacturer is financially responsible, is accessible, and his infringements readily provable, and when the patent owner is financially able, and is one who makes it his sole business to grant licenses, and is under a duty to his licensees to prosecute extensive infringers, the sending of such 88 Flint v. Hutchinson Smoke Burner Co., 110 Mo. 492-1892; 19 S. W. 804; 16 L. R. A. 243. 89 Adriance, Platt & Co. v. National Harrow Co., 121 Fed. 827-30-1903 (C. C. A. 2d Cir.); 58 C. C. A. 163; 49 L. R. A. 755. circulars to customers would seem to be merely a preliminary or cumulative measure, and the bringing of an infringement action the paramount and imperative proceeding. As, ordinarily, the patent owner would be prompt and zealous to assert his claims, if he halts and purposely procrastinates and attempts to effect by threats and manifestoes, that which he can compel by the strong hand of the law, a strong inference arises that he has not any real confidence in his pretensions. This inference becomes irresistible if he refuses to bring suit during a considerable period of time when the alleged infringement is open, notorious and defiant, and so extensive as to threaten destruction to his alleged exclusive rights. The indicia of bad faith are persuasive in the present case. It is impossible to read the communications warning complainant's customers against selling its harrows, with which the defendant seems to have flooded the country, without being led to believe that they were inspired by a purpose to intimidate the complainant's customers, and coerce the complainant, by injuring its business, into becoming a licensee of the defendant. In view of its failure to bring an infringement action, under circumstances which made an action practically compulsory, the defendant cannot shelter itself behind the theory that the circulars were merely legitimate notices of its rights. We are satisfied that they were sent, not for the purpose of self-protection, but in execution of the defendant's threat to stop the complainant from building harrows by other means than legal remedies." Hovey v. Rubber Tip Pencil Co.90 points out the same distinction, and holds that circulars threatening litigation cannot be interfered with, unless bad faith be shown. It is, of course, possible that such circulars may be distributed in good faith to warn against infringement, and in doing so commit no wrong. It is the fraud that gives the right to an injunction. Bad faith, the intent to destroy the business of another, and hence danger to property rights, are the grounds given by the Circuit Court of Appeals on which equity may interfere. An equity court will not enjoin a person from asserting his belief that he owns title to property. Where the record does not make it clear that statements made by defendant are either malicious or false, equity will not act.91 A circular of warning and stating that suit 957 N. Y. 119-1874. 91 Everett Piano Co. et al. v. George P. Bent, 60 Ill. App. 372-1895. had been started, which has been adjudged to be proper, is found at 151 Fed. 134. If the circular is issued in bad faith, which fact is shown by neglect to bring suit, it may be enjoined.92 If the complainant's bill be true, it has an undoubted right to warn the public against the infringement of its trade-mark; that question should not be determined on the mere allegations of the parties 93 (id. p. 135). "Where notices are given or circulars distributed in good faith to warn against infringement, no wrong whatever is committed; but where, as is here averred, they are not made or issued with such intent, but in bad faith, and solely for the purpose of destroying the business of another, a very different case is presented. In such a case property rights are fraudulently assailed, and a court of chancery, whose interposition is invoked for their protection, should not refuse to accord it." 94 It is interesting to note that the position taken by the Circuit Court of Appeals in this Farquhar case is the same position taken by the English courts in cases which were not considered authority in Kidd v. Horry, supra, viz., that a man's trade reputation and the reputation of his goods is property which equity must protect. 92 Warren Featherstone Co. v. Landauer, 151 Fed. 130-1903 (C. C. Wis.). * Adriance, Platt & Co. v. National Harrow Co., 121 Fed. 827-1903 (C. C. A. 2d Cir.); 58 C. C. A. 163; and A. B. Farquhar Co. v. Same, 102 Fed. 714-1900 (C. C. A. 3d Cir.); 42 C. C. A. 600; 49 L. R. A. 755. The following are more recent cases in which threats of prosecution have been held not to be justified by good faith, and have therefore been stopped by injunction: Paper Goods Co. v. Dittgen, 171 Fed. 631 (C. C. A. 7th Cir.); Electric Renovator Mfg. Co. v. Vacuum Cleaner Co., 189 Fed. 754 (two years' delay in prosecuting suit evidence of bad faith); Atlas Underwear Co. v. Cooper Underwear Co., 210 Fed. 347 (no suit for a year; misleading statements and threats). In the first of these cases (171 Fed. 633) it was said: "Undoubtedly, one claiming that his patent is being infringed should take steps to advise the public of his rights as provided by statute; provided, however, that if it is made to appear that under pretense of so doing he is pursuing a course which is calculated to unnecessarily injure another's business, and with the plain intention of so doing, his conduct will be deemed malicious, and he brings himself within the rule of law obtaining in cases of unfair competition in trade, and subject to injunction." 94A B. Farquhar Co. v. National Harrow Co., 102 Fed. 714-15-1900 (C. C. A. 3d Cir.); 42 C. C. A. 600. |