Post Civil War Firearm Patent Litigation Against the U.S. Government.

• Date: 01 March 2019
• Author: Harrison, Joshua C.

1. INTRODUCTION: THE LEGAL TECHNICALITY THAT WAS USED TO DECIDE SEVERAL POST CIVIL WAR FIREARMS PATENT INFRINGEMENT CASES AGAINST THE GOVERNMENT

   The Civil War effected a flurry of invention and patent activity related to firearms (1 2). The information contained in the resulting new patents provided an important opportunity for the military to improve its arms, but also provided a motivation for patent infringement by the Government. Since patent infringement was a tort for which the Government enjoyed sovereign immunity at the time, inventors could only hope to recover damages under an implied contract theory that could be quite fictitious and self-contradictory (3). Specifically, victims of infringement that hoped to sue the Government would have to argue that the Government did not infringe--that the claimants themselves had actually given the Government license to use their invention in return for an amount of money not agreed upon prior to litigation. Typically, there was no express contract on which to base this license, so the existence of an implied contract would have to be argued to the court. Although some firearms patent infringement cases against the Government were decided based on the substantive merit of the patent claims (4), several otherwise meritorious cases turned upon the legal technicality represented by the success or failure of the aforementioned implied contract argument, with both positive and negative outcomes for the claimants.

   2. INVENTOR WINS THE IMPLIED CONTRACT ARGUMENT: THE STORY OF THE BERDAN FIREARMS CASE

   Shortly after the Civil War, the U.S. Government wanted to upgrade the standard firearms used by the Army, from muzzle-loading muskets to breach-loading rifles and carbines (5). The protracted Berdan Firearms litigation, that eventually led all the way to the Supreme Court (6), arose from government infringement of a patent during that effort.

   On "January 30, 1866, the Secretary of War issued an order for the meeting and organization of a board of officers of the Army, of which Maj. Gen. [Winfield Scott] Hancock was named as president. Hancock was a very prominent Army officer considered by many to be one of the heroes of the civil war. (7) The board, known as the Hancock Board, was "ordered to examine thoroughly the following questions, and make recommendations thereon: (1) What form and caliber of breech-loading arm should be adopted as a model for future construction of muskets for infantry? (2) What form and caliber should be adopted as a model for future construction of carbines for cavalry? (3) What form of breech-loading arm should be adopted as a model for changes of muskets, already constructed, to breech-loading muskets?'". (8)

   When the Hancock Board met in Washington in March of 1866, it solicited experimental arms from the general public for testing and possible purchase by the Government for the Army (9). Today it might seem surprising that the Government would solicit experimental arms from members of the general public, since many modification of firearms by average citizens are now illegal. However, such solicitation made sense in the period following the Civil War because in some important aspects, such as the design of the spent cartridge ejector, the design of firearms was then still an immature and experimental art (10). Indeed, the list of private parties and individuals that submitted experimental firearms to the Hancock Board appears more like a contemporary list of sellers of self-written computer programs than like any modern-day list of modern firearms manufacturers competing for a large government contract (11).

   One of the parties that submitted firearm inventions to the Hancock Board was the Berdan Fire-arms Manufacturing Company. The Berdan firearm invention was also introduced to a second board of officers convened by the Government to inspect new firearm designs, called the 'Terry Board' in 1873 (12). These exhibitions proved futile; the Government did not directly use the Berdan invention (13). However, the Government did procure 437,519 improved Springfield infantry muskets (14) according to an infringing design by one "Mr. Adams", who was a workman at the National Armory in Springfield, Massachusetts (15). Mr. Adams' design was independently conceived after the Berdan invention, but was essentially its equivalent (16).

   Nevertheless, the Berdan Fire-arms litigation did not turn on whether the Army benefited from the use of Berdan's patented invention; there was no question that it did (17). Instead, the outcome of the case depended on whether the use by the Government created an implied contract whose breach the Court of Claims could provide remedy, or else was an "infringement"--a type of tort for which the Court of Claims could not provide remedy (18). The jurisdiction of the Court of Claims (where Berdan brought suit) did not extend to cases "sounding in tort" according to relevant case law and the then-relevant jurisdictional act of 1887 (19).

   Ultimately, the Court of Claims held that an implied contract did exist between Berdan and the Government (20), because the Government used the invention knowing that it was covered by the Berdan patent, and knowing that Berdan would expect compensation (21). Consequently, the Court of Claims awarded Berdan $95,004.36, which was what the Court calculated to be reasonable compensation for the use of his idea (22). Berdan's award in the Court of Claims was no small sum in 1890. According to a calculation based on historical trends in the consumer price index, the sum awarded Berdan in 1890 would exceed $2.6 million in today's dollars (23). The Supreme Court affirmed the Court of Claim's holding on cross appeals by both the Government and by Berdan (who wanted a larger award) (24).

3. INVENTOR LOSES THE IMPLIED CONTRACT ARGUMENT: THE STORY OF THE RUSSELL CASE

   Approximately two decades after initiating the upgrade of standard Army firearms from muzzle-loading muskets to breach-loading rifles, the U.S. Government was ready for another significant improvement: this time to magazine-fed rifles (25). Again, the Army chose a rifle that infringed upon the patent of an individual inventor (in this case Andrew H. Russell). Again, the resulting litigation reached the Supreme Court which affirmed the decision of the Court of Claims (26). And, again, the outcome of the case turned upon the legal fiction of implied contract (although in this case with opposite outcome).

   The story of the Russell case started on February 4, 1881, when Congress acted to convene a board of officers to select a magazine-fed rifle for the service of the United States. Andrew H. Russell submitted a patented rifle to this board, and again to a board convened later for the same purpose on December 16, 1890 (27). The second board did not select Russell's design, but rather selected on September 15, 1892 a design submitted by a Norwegian company, Krag-Jorgensen. Krag-Jorgensen's rifle had features that were covered by its own patents, but it also had features that infringed upon a patent owned by Russell. Although Russell notified the Government of this infringement on November 16, 1892, the Government did not negotiate with him; the Ordnance Office of the War Department merely informed him that: (1) he might sue in the Court of Claims if he wished, and that (2) Krag-Jorgensen might end up indemnifying the Government from such suit depending on the final wording of a pending contract (28).

   The Ordnance Office ended up taking some indemnity from the Krag-Jorgensen company, indicating that the Office may not have understood the extent of the Government's immunity from infringement actions. Russell complained to the Ordnance Office (to no avail) that he could have no practical remedy against Krag-Jorgensen since they had no property within the United States (29). The Government ignored Russell's complaints and entered into a contract with Krag-Jorgensen on June 7, 1893 to pay royalties in return for the right to manufacture the Krag-Jorgensen design (30)--paying Russell nothing.

   Russell sued but ultimately lost. The case turned on the Supreme Court's refusal to infer an implied contract / license from Russell's correspondence with the Government...