This section is from the book "The Law Of Contracts", by Theophilus Parsons. Also available from Amazon: The law of contracts.
The statute provides that "whenever in any such action (action on the case) a verdict shall be rendered for the plaintiff, the court may enter judgment thereon for any sum above the amount found by the verdict as the actual damages sustained, according to the circumstances of the case, not exceeding three times the amount of such verdict, together with the costs." (r) And another section gives the same power to courts of equity. (s)
It must be noticed that this power applies only to "actual damages;" if therefore vindictive or exemplary damages were given, and they might be in a case calling for them, especially if
(p) Caldwell v. Van Vliessingen, 9 Hare, 415. In this case an injunction was granted against the owners of a Dutch vessel, forbidding the use, within English waters, of a certain screw-propeller for which the plaintiff held an English patent. Vice-chancellor Turner's decision rests on the principle, which lays down broadly at the outset, that "the rule is universal that foreigners are in all cases subject to the laws of the country in which they may happen to be." The Statute 15 & 16 Vict. ch. 83, § 26, passed since this decision was given, provides that no letters-patent granted after the passage of that act, shall extend to prevent the use of any such invention in any foreign ship which may be in any waters within Her Majesty's dominions.
(q) Brown v. Duchesne, 2 Curt 871, affirmed, 19 How. 183. The facts in this case were substantially the same as in Caldwell v. Van Vliessingen, supra. A French vessel was rigged in France with gaffs similar to those for which the plaintiff held an American patent. On her arrival in Boston, the master was sued for infringement. Says Curtis, J., in the opinion given in the Circuit Court: "It cannot be doubted that, in the apprehension especially of all commercial States, the particulars in which vessels of one country shall be controlled or affected by the municipal laws of another country, while lying in its ports, is a distinct subject of legislation, quite aside from its internal affairs, and to be influenced by considerations very different from those which would determine the grant of a monopoly affecting the domestic trade of the country. To say that when Congress legislated respecting patents, it had in view this matter, and intended to enable private citizens to interfere with the structure or equipment of foreign vessels, seems to me not admissible. Such an intention may be manifested by express enactment extending its terms to some or all foreign vessels ; it may even be deduced from a law broad enough in its general terms to embrace such vessels, and which, from its subject-matter and the mischiefs to be remedied, may fairly be considered to have been designed to include such an exercise of power. But in making the laws concerning patents, Congress was legislating alio intuitu."
(r) Act 1870, § 59.
(s) Act 1870, § 55.
•257 zz the suit be a second one against the same defendant, (t) this power of the court would not extend to them. (u) Nor * would the court listen with favor to an application to zz treble the damages given by the verdict, unless malice, insufficiency of the verdict, or other special reasons were shown. (uu) By a prevailing rule, the damages in a case of infringement of a patented machine, are the profits actually received from the infringement, by the debtor. (v) But it is not easy to see why the principle of indemnity should not be applied here also, as it is almost universally, to measure the damages. And, on this ground, we think there should be a due regard to the damage actually sustained by the plaintiff from the infringement. This is disputed, however; and in one case bearing upon this subject, Mr. Justice Story said: "Struck with similar difficulties in establishing any general rule to govern cases upon patents, some learned judges have refused to lay down any particular rule of damages, and have left the jury at large to estimate the actual damages according to the circumstances of each particular case. I rather incline to believe this to be the true course." (w) At
(t) Alden v. Dewey, 1 Story, 836.
(u) Stimpson v. The Railroads, 1 Wall. Jr. 169. In spite of the dictum of Judge Story, cited in the last note, it may be doubted whether the jury were ever justified in returning a verdict for anything but the actual damages. Thus in Seymour v. McCormick, 10 How. 488, Grier, J., says, that "the act confines the jury to the assessment of actual damages. The power to inflict vindictive or punitive damages is committed to the discretion of the court within the limit of trebling the actual damages found by the jury." See also, Stephens v. Felt, 1 Blatchf. 38; Buck v. Hermance, id. 400; Hall p. Wiles, 2 Blatchf. 201; Pitts v. Hall, id. 288.
(uu) Schwartzel v. Holenshall, 3 Fish. Pat.Cas. 116.
(v) Lowell v. Lewis, 1 Mass. 186; Wilbur v. Beecher, 2 Blatchf. 132; Parker v. Bamber, 6 McLean, 631; Buck v. Hermance, 1 Blatchf. 396; Bell v. Daniels, 1 Fish. 873; Page v. Ferry, id. 298; Wayne v. Holmes, 2 Fish. 20; Case v. Brown, id. 208.
(w) Earle v. Sawyer, 4 Mass. 1; and see Pierson v. Eagle Screw Co. 3 Story, 402; Kneass v. Schuylkill Bank, 4 Wash. 14; Hays v. Sulzor, 1 Fish. 532; Ransom v. Mayor of New York, 1 Fish. 263. So In Seymour v. McCormick, 16 How. 480,i Grier, J., says: "It must be apparent to the most superficial observer of the immense variety of patents issued every day, that there cannot, in the nature of things, be any one rule of damages which will equally apply to all cases. The mode of ascertaining actual damages must necessarily depend on the peculiar nature of the monopoly granted." And, again: "It is only where, from the peculiar circumstances of the case, no other rule can be found, that the defendant's profits become the criterion of the plaintiff's loss." And in Parker v. Hulme, 1 Fish. 44, Kane, J., in charging the jury, said: "The damage assessed should be compensatory. The criterion is indemnity. You may take into consideration the loss sustained by the plaintiff, as you may likewise the profit made by the defendant. . . . You are to give compensatory damages, such as may indemnify the plaintiff for the injuries he has sustained."
In Goodyear v. Bishop, 2 Fish. 164, where it appeared that the profits made by the defendant were very trifling in proportion to those which the plaintiff made on the same amount of goods, the jury were instructed that they were to "examine the evidence, and say whether there was sufficient proof to satisfy them that any and how many customers were diverted from the plaintiffs to the defendab ab the same * time, it must be certain, from the use of the words in the statute, "actual damages," if not for other and more general reasons, that, in the words of an eminent judge used in declaring the decision of the Supreme Court of the United States, in a very important case, "Actual damages must be actually proved, and cannot be assumed as a legal inference from any parts which amount not to actual proof of the fact." (x) ants; whether the plaintiffs were prepared to supply, and were prevented from supplying, the articles made by the defendants; in short, whether, by the competition of the defendants, the plaintiffs were limited, hindered, checked, or interfered with in their business, or otherwise actually damaged to an amount equal to the profits which they could have made, if they had made and sold the goods made and sold by the defendants, over and above what they (the plaintiffs) did in fact make and sell; and, if so, that the jury might return a verdict for actual damages to this amount." See also Pitts v. Hall, 2 Blatchf. 229; Livingstone v. Jones, 2 Fish. 207. Where the patentee has an established license fee for the use of his invention, it is well settled that the amount of this is the measure of actual damages. McCormick v. Seymour, 16 How. 480; Hogg v. Emerson, 11 How. 607; Sanders v. Logan, 2 Fish. 167; Goodyear v. Bishop, 2 Fish. 154; Sickles v. Borden, 8 Blatchf. 536.
(x) McCormick v. Seymour, 16 How. 480; Whittemore v. Cutter, 1 GalL 431; Poppenhausen v. N. Y. G. P. C. Co. 2 Fish. 62; Burdell v. Denig, id. 688; Schwarzel v. Holenshade, 3 Fish. 116. But the defendant is not accountable for such profits as he might have made with reasonable diligence. Livingston v. Woodworth, 15 How. 650; Dean v. Mason, 20 How. 208. It was formerly held that the jury might allow, as part of the "actual damages," a reasonable sum for counsel fees; but it is now settled otherwise. Teese v. Huntington, 23 How. 8; Parker v. Hulme, 1 Fish. 44; Blanchard Q. S. Man. Co. v. Warner, 1 Blatchf. 272; Stimpson v. The Railroads, 1 Wall. Jr. 166.
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