Dowagiac Manufacturing Co. v. Minnesota Moline Plow Co.

Background

A maker of grain-drills who owned a patent on certain improvements to so-called “shoe-drills” sued two wholesale dealers who were selling drills made by manufacturers later found to be infringing. The plaintiff manufactured drills sold as “Dowagiac”; many competing drills were sold as “McSherry” and “Peoria.” Lower courts found the patent valid, held the dealers to be infringers, enjoined further sales, and referred the cases for an accounting of profits and assessment of damages.

Reasoning

The Court explained that the patent covered only particular improvements to an existing type of drill, not the whole machine, and that the value of completed drills came in substantial part from unpatented parts. Because the plaintiff sought the defendants’ profits from finished drills, the profits were commingled and the plaintiff bore the burden to present evidence separating profits attributable to the patented improvements from those due to unpatented features. The Court found the plaintiff failed to produce such apportionment evidence or proof of lost sales or an estimated royalty. The Court also noted roughly 2,500+ infringing sales and that about 261 were made wholly in Canada, for which no U.S. recovery is allowed. The dealers’ infringement was not willful.

Real world impact

Because the record was incomplete and earlier guidance had since been clarified, the Court reversed and sent the cases back for rehearing before a master, allowing the plaintiff to submit further evidence on apportionment, reasonable royalty, and damages. The decision is not a final award of money and may change after the new accounting.