Rex Chainbelt Inc., (Cross-Appellee) v. Harco Products, Inc., Dba Dfc Company, (Cross-Appellant)

This action was instituted by appellant Rex Chainbelt Inc. in the Federal District Court for the Central District of California against Harco Products, Inc. for infringement of Rex’s U. S. Patent No. 2,970,783. Harco answered the complaint alleging that the patent was unenforceable because of misuse, and that the patent was void as being “obvious” under 35 U.S.C. § 103 . Harco also filed a cross-complaint alleging that Rex’s misuse of its patent and the bringing of this patent infringement suit constituted a violation of § 1 of the Sherman Act in that the patented process was being used to “tie” the sales of an unpatented component used in the process.

The district court found that it had jurisdiction over this contest under both the patent law ( 28 U.S.C. § 1338 ) and the antitrust law ( 28 U.S.C. § 1337 ).

After a trial on the merits, the court found: (1) the patent in question was void for obviousness under 35 U.S.C. § 103 ; (2) if the patent were valid, then while Harco had not directly ( 35 U.S.C. § 271 (a)) or contributorily ( 35 U.S.C. § 271 (c)) infringed the patent, they had actively induced others to infringe on the patent ( 35 U.S.C. § 271 (b)); (3) Rex’s…