Green v. Wilson ( 1870 )

The Chancellor.

The complainant, claiming as patentee the exclusive right to sink wells in the manner described in his patent, authorized the defendant to sink wells in a certain district in this state, including the county of Union, in that manner; reserving to himself the power to revoke the license at his pleasure. The defendant agreed to pay a certain royalty on ■every well that he sunk in that manner, to recognize the validity of the patent, to pay the royalties agreed upon, and upon the revocation of the license to refrain from eonstructing such wells. The agreement was by mutual covenants under seal.

The defendant sunk several wells in the manner described, but neglected to pay the royalty. The complainant thereupon revoked the agreement, but the defendant still went on sinking wells.

The bill was for an account of the royalties on the wells sunk before the revocation, and to restrain the construction of any more wells of the kind described in the letters patent.

The defendant insists that this court has no jurisdiction, because the suit involves the validity of the patent, and the jurisdiction in such case is exclusively in the Federal courts,

This suit is not upon the patent, or for an infringement of it, but is upon the covenant under seal, and is for a violation of that, and to restrain a further violation of it. The •validity of the patent may come in question, if the defendant seeks to avoid the agreement for fraud or want of consideration. But in such cases it is held that the jurisdiction is in the state courts, and that when the suit is between, citizens of the same state the Federal courts have-not jurisdiction. _ ------'

The defendant claims that the contractAh revoked, and not merely the license; and the contract being revoked, the complainant can have • no_ relief upon it, but only upon his patent. ' The bill charges that the complainant revoked the contract, and the written notice served on the defendant stated that the contract was thereby revoked. But the evident object of this notice was to revoke only the authority or license. The contract expressly reserves the right to revoke the authority, not rescind or revoke the contract. The word revoke is not applicable to a mutual contract like this. Rescinding or annulling it, is a different matter from revocation. The terms of the notice must be construed according to the intention of the contract under which the notice was given; and the allegation of the bill must be construed to conform to that meaning. The complainant could not revoke the covenants of the defendant; he might discharge the defendant from them. This notice cannot be construed into a discharge.

But the allegations of the bill are insufficient to sustain the injunction. It is no where alleged that after the revocation the defendant had sunk wells according to the plan patented, or that .he threatened or intended to sink such wells; but only that he continues to drive and construct a large number of non-flowing wells and other wells within the district. This he had a perfect right to do, provided they were not of the kind, or sunk in the manner designated in the agreement. For an injunction it is not only necessary to aver a right, -but also that the defendant has violated or intends to violate it.

The demurrer must be overruled and the injunction dissolved.