Gillman et al. v. Stern et al.

Circuit Court of Appeals, Second Circuit
114 F.2d 28 (1940)

ELI5:

Rule of Law:

A prior, secret use of an invention does not constitute a "public use" that would invalidate a subsequent patent, nor does the secret inventor qualify as a "first inventor" under patent law.

Facts:

Laszlo Wenczel invented a pneumatic "puffing machine" for quilting fabrics.
A patent for the machine was applied for on January 21, 1931, and subsequently issued.
Prior to Wenczel's invention, a man named Haas had independently created and used a substantially similar puffing machine.
Haas took extensive measures to keep his machine and its workings a secret, allowing only his long-term employees to use it inside a shop that was locked from the inside.
Haas instructed his employees not to share any information about the machine.
Haas did show the machine's performance, but not its construction, to two business partners (Custer and Kadison) for the purpose of them becoming selling agents for the machine's product, and these partners had a shared interest in maintaining secrecy.
Stern, the defendant, later sold machines that allegedly infringed on Wenczel's patent.

Procedural Posture:

The plaintiffs (patent holders) sued the defendant, Stern, in federal district court, seeking an injunction for patent infringement.
Stern asserted several defenses, including patent invalidity due to a prior use by an individual named Haas, and filed a counterclaim against the plaintiffs.
The trial court judge held that the patent was invalid because it was anticipated by the prior use of Haas.
The trial judge also sustained Stern's defense of the plaintiffs' inequitable conduct but dismissed Stern's counterclaim.
Both the plaintiffs, as appellants, and the defendant Stern, as cross-appellant, appealed the judgment to the U.S. Court of Appeals for the Second Circuit.

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Issue:

Does a prior, secret use of an invention by another party, which is intentionally concealed from the public, invalidate a subsequent patent on the same invention?

Opinions:

Majority - L. Hand

No, a prior, secret use of an invention does not invalidate a subsequent patent. The court reasoned that under patent law, an invention must be made public to defeat a later patent. The statutory bar of a prior "public use" is distinct from a secret use. Similarly, a secret inventor is not a "first inventor" in the statutory sense because their work has not enriched the public art. The court, citing precedent like Gayler v. Wilder, emphasized that the patent system is designed to reward those who disclose their inventions to the public. Haas's deliberate and successful efforts to conceal his machine—locking his shop, enjoining his employees to secrecy, and even seeking secrecy during his court testimony—proved his use was secret, not public. Therefore, Haas's machine does not constitute anticipating prior art, and Wenczel's patent remains valid.

Analysis:

This decision reinforces the critical distinction between public use and secret use in patent law, clarifying that concealment prevents a prior invention from becoming invalidating prior art. It establishes a strong incentive for inventors to disclose their creations through the patent system rather than relying on trade secret protection if they wish to establish priority. By holding that a secret inventor is not a "first inventor" for purposes of invalidating a later patent, the case ensures that the patent system rewards those who contribute to the public fund of knowledge. This precedent makes it more difficult for infringers to defeat a patent by unearthing a prior, hidden use of a similar invention.

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