Tuesday, September 18, 2012

OWENS v. AMERICAN STEREOGRAPHIC

     This is the third and final installment of my investigation into the litigious back story of 3-D comic books. To get a full understanding of what follows, it is best to have read both of my previous posts, "Two Views of 3-D Comics" and "Tale of the Tape". Unheard in the courtroom, but very much in the minds of the participants, chosen portions of the tape are interspersed throughout this article.-- Ken Quattro
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          FELDSTEIN: When we made all these conjectures, I lifted myself from being Lenny’s friend, and looked at it from a purely business point of view.
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THE PLAINTIFFS

     The whole situation had gotten out of hand. It started with an uncomfortable business meeting between old friends, schoolmates, suspiciously eyeing one another over a contract. Clandestine dealings and a month of contentious communications followed, capped by a surreptitiously tape-recorded interrogation/brainwashing. Smooth legalese soon tempered blunt accusations and elevated a Brooklyn street fight to a Foley Square courtroom.


Stenographer's minutes from 
OWENS v. AMERICAN STEREOGRAPHIC
[filed Oct. 7, 1953]
 
     On Sept. 1, 1953, the attorneys for the opposing parties appeared before Judge Irving R. Kaufman at 10:30 a.m. to argue the case. Emanuel Posnack, who represented American Stereographic, the corporation formed by brothers Norman and Leonard Maurer, their friend Joe Kubert and publisher Archer St. John, requested more time to prepare his case. Martin Scheiman, representing inventor Freeman H. Owens as well as Gaines, fought that request. Judge Kaufman heard both attorneys and granted a one week delay. The case was rescheduled for the following Tuesday, after the Labor Day holiday.
     The attorneys next appeared before Judge Edward A. Conger on September 9, 1953, which was a Wednesday. In a quick hearing, Scheiman requests to be heard as soon as possible. It is indicated that Posnack cannot make it the next day (Thursday). Court is adjourned and convenes once more at 10:30 a.m., Friday, September 11th.
     Scheiman immediately asks the judge for permission to serve Posnack with additional papers. When the court asks why, Scheiman launches into a long story explaining how Posnack served him with papers late in the afternoon the previous Wednesday. Since it was so late in the day, and the following Thursday was a Jewish holiday, he wasn’t able to serve Posnack in turn. The judge cuts Scheiman short and allows him to serve Posnack with additional papers. The court briefly adjourns.
     When court finally resumes at 12:15, Scheiman begins.
     "If your Honor please, this is a motion for a preliminary injunction in connection with a suit for the infringement of a patent issued to one Freeman H. Owens, on October 13, 1936. The patent will expire on October 13 of this year."  1 
     "Then it will be moot on October 13th," reasoned Judge Conger. Scheiman agrees, and after noting all the parties involved, he points out the uniqueness of Owens patent,“…to provide a set of complementary stereographic pictures from a flat drawing.” He goes on to say, “Lest your Honor be in any way misled by what I say, I want to impress upon you that no claim is made by the Owens patent or by the plaintiffs that Mr. Owens invented anything new in the sense of stereoscopy as a science, which has been long and well known for perhaps a hundred years or so; what he did do in his invention was to make it possible to make an ordinary drawing and by a unique process convert that drawing into something which could be adapted to several forms of entertainment, advertising, and other purposes.”

"Method of Drawing and Photographing 
Stereoscopic Pictures in Relief"
(patent # 2057051)      

     “If you will examine the letters patent you will note that Mr. Owens illustrated his process in part by the use of certain panels cartoon-like in character depicting what might be termed a Tarzan-like scene.”      
     "The defendants," Scheiman continued, "have produced in the recent past a number of so-called comic books. Several of them are before your Honor. The first one which was produced by the defendant St. John pursuant to the process which I have referred to as the Illustereo process professedly invented by certain of the individual defendants, was on the New York newsstands approximately on July 3rd or July 5th."
     "It has been followed in rapid succession by a number of similar comic books employing the same process."
     "It is the plaintiffs' contention, and I don't think there can be very much doubt of that in view of the affidavits that are now before this Court, that the defendants have, in fact, made use of the Owens process in the preparation and production of their comic books. 
     “The defendants have attempted to explain their position by introducing the proverbial red herring in this matter in large quantity. I submit, your Honor, that most of those red herrings are so decomposed that they putrefy the atmosphere,” Scheiman suggested. You should imagine that he took a pause to let his colorful imagery sink in.
     “The defendants have attempted by the use of distortions and other media to create the impression that the Owens patent is not a patent relating to the conversion  of an ordinary drawing into a 3-dimensional effect. That, your Honor, I submit is equally transparent and sham.”
     Scheiman then presents an affidavit from a retired chief examiner for the United States Patent Office named George Hanlin. Hanlin was the examiner who approved Owens original 1936 application and Scheiman claims that his affidavit , “…clearly and convincingly demonstrates that the Owens patent is beyond reproach, beyond criticism, as valid as any patent.”
     Scheiman notes the case being made by American Stereographic is, “…that the Owens patent constitutes in part prior art.” This claim, he says, undermines their own Illustereo patent application, which was made in May, 1953.
     Legally, prior art constitutes everything ever known publicly about an invention before a given date. In other words, if knowledge relevant to an invention is accessible by the public, it could disqualify a patent application. A trade secret, which is confidential information not readily available to the public, is usually not considered prior art.
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          GAINES: Now, at that time, I was very definitely given to understand that he had...that you had...patents pending.
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    Scheiman further contends that the defendants' application, "...to my knowledge has not been prosecuted beyond its initial stages, except that the defendants have alleged that they have made application for special treatment of that particular application."
     The special treatment he referred to was the requested accelerated consideration and approval of the Illustereo application by American Stereographic. Clearly, they wanted to get their comics on the stands and start licensing their process as soon as possible. The 3-D fad was currently hot, and there were no guarantees on how long that would last.
     After stating his opinion that this request would be denied, Scheiman says, "If the defendants knew about the Owens patent at the time they "jumped the gun" then they have committed a serious wrong, created an immoral situation, in my humble judgment."
     "If they did not know about the Owens patent existed at the time they filed their application, then they were guilty of inexcusable ignorance because they professed in their papers to have made a laborious search through experts."
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          FELDSTEIN: Who made St. John’s patent search?
          KUBERT: The one guy was this Asher Blum." 
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     Asher Blum was an old-time patent attorney and while it's curious that St. John used him instead of Posnack to do the patent search, it's even more interesting (as far as comics history is concerned) that Blum was the lawyer for Victor Fox in the landmark copyright infringement lawsuit brought against him by D.C. comics, Detective Comics, Inc. v. Bruns Publications. [covered in my article in ALTER EGO #101 and online beginning here: DC vs VICTOR FOX]
     Scheiman went on. "It would be impossible, your Honor, for a patent of this nature to be overlooked in the ordinary course of such a search. But I shall no dwell upon the facts in that connection, because it is unnecessary to the attainment of the relief sought herein to prove knowledge on the part of the defendants or lack of it."
   Once again asserting that the defendants had "usurped" Owens process, Scheiman points out, "...that the papers that have been interposed by the defense illustrate and clearly depict a steady retrenchment, a steady backward motion of the position originally asserted by the defendants as to their rights."
     "For example, in the original comic book published, the first one of this nature using the plaintiffs' process and referred to in the trade and publicly as "Mighty Mouse", there are clear indications that the defendants have published this book pursuant to a licensed process for which a patent application is pending. Gradually and steadily the defendants have obliterated, removed, and concealed any such assertions."
     At this point, he picks up a comic book. "Yesterday, the book I hold in my hand, "Little Eva", went on the New York newsstands for sale, and it significantly omits any references to there even being a patent pending application for their alleged Illustereo process."

   
Comparison of "Mighty Mouse" comic with "Patent Pending" note 
and "Little Eva" comic without.

     Scheiman then makes another accusation. As soon as American Stereographic had applied for their patent in May, "They immediately licensed the St. John Publishing Company under that so-called Illustereo process."
     "I submit, your Honor, that the evidence before this Court suggests strongly that the defendants never intended in any way or manner to license anybody else. But they were pretty sly. They knew what they might be confronted with should they confer upon St. John an absolutely exclusive right, and they profess to offer such license to competitors of St. John."
     "They did this, mind you, sometime after they had given Mr. St. John the opportunity to be the first "infringer". 
     Hyperbole aside, there was some truth to Scheiman's accusation. Years after the fact, Leonard Maurer told interviewer Ray Zone,"We gave St. John a 25 percent partnership in our licensing company, along with a 6 month's head start for his publishing company in exchange for financial guarantees for Norman and Joe as Editors, and myself, as supervising producer..."2
     Scheiman went on.
     "But in the course of the next succeeding months or weeks they preferred self-styled standard licensing agreements to the plaintiffs in this action, and presumably to other comic book publishers in the City of New York and perhaps throughout the country."

   
Copy of licensing agreement offered to E.C. 
and likely other publishing companies.
 
     "These contracts, those self-styled license agreements, are so unfair, your Honor, that if time permitted I believe I could convince you from the bench to agree wholeheartedly with me that it was never the intention of the defendants to license anybody other than St. John."
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          GAINES: How do we know that we don’t have the same process as you have? Or maybe we have a different process. Why should we pay you $2,500 a book?
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     Scheiman claimed that, “…in the course of the negotiations had by the defendants with the plaintiff corporations it became quite obvious to the plaintiffs and their counsel that the defendants had nothing to license, nothing to sell, and they were asking quite a price."
     “In the course of those negotiations because of the suspicious inclusion and/or exclusion of necessary clauses in the license agreement, the plaintiffs became suspicious.”
     “They undertook to make a search of their own. They discovered the Owens patent. They negotiated with Mr. Owens and secured a license agreement under the Owens patent and have been endeavoring since obtaining that license in July to publish 3-dimensional comic books for sale to the public.”
      Scheiman continued. “Now, your Honor should bear in mind that the comic book market today is highly competitive, that the introduction of 3-dimensional comic books was considered a great scoop. Mr. St. John has admittedly done a wonderful job filling his coffers with profits and in enhancing his prestige in the industry.”
     “The inventors admit in certain releases,” he states, “…that the market for 3-dimensional comic books is necessarily a limited one in respect of time, that in the course of a few months succeeding the introduction of the epic “Mighty Mouse”, it would be highly probable that millions of this one comic book would be flooded throughout the United States and elsewhere, perhaps, so that comic book publishers who undertook to sell their own comic books at a later date would find it virtually impossible to gain a ready and successful market.”
     “The evidence before the Court is replete by admissions by the defendants that it was their intention to glut and flood the market…”.
     The gushing  publicity that was so welcomed by St.. John and the others just weeks before was being used against them. "It was a publisher's dream come true," wrote Aron Mathieu in the August issue of WRITER'S DIGEST, "enough sales of one issue of one magazine to call it quits and retire...or bat out a dozen imitations for three months before the onrush of 50 hurried and harried competitors swamp the field."  3 
     Schieman opined that however the defendants learned of Owens' patent, "...they knew the Owens patent would expire, and whether they learned it when Mr. Owens sent letters to them, is immaterial. Those letters were sent in July. It has not stopped the defendants from releasing for publication three or four more of the same kind of books, employing the very same infringing process."
     “What cared they? They made their investment and they were going to protect it,” he dramatically stated, “But in an effort to conceal, to confuse, to obscure the rights of Mr. Owens and the plaintiffs in this dispute, they have resorted to skullduggery and roughism such that I have never confronted in my life.”
     When Judge Conger asks for an example of distortions claimed by Scheiman, he directs the jurist to Leonard Maurer’s affidavit. When Scheiman goes on at length to point out an observed discrepancy between Maurer’s affidavit and Owen’s, the judge finally cuts him off.
     “I don’t see anything so frightful about that. I don’t see that there is any great or deliberate or terrible distortion.”
     Scheiman makes one more attempt. He points to Norman Maurer's affidavit which attempts to show the differences between the Illustereo process and Owens' patent.
     "By the Owens process, several months are required to produce a 3-dimensional comic book," Maurer claimed,"whereas by the Illustereo process, the production can be completed in 14 days."
     Schieman sees this as a purposeful distortion on behalf of the defendants.
     "The matters pertaining to the placing of a book on the market are far beyond the process used. There are many things that follow the use of this process, the making of photographic plates, the printing on the plates, the assembling of the book, the putting of the covers on the books, the stapling of the books, the placing of the finished product in the hands of the distributors, and the like."
      "It is now obvious, transparent and clear that the defendants were attempting to delude the plaintiffs and they were attempting to delude this Court when they uttered those remarks."
     This draws no comments from the judge this time, so he launches right into another claim.
     “I realize full well that the Owens patent hs not been adjudicated before. The defendants are relying strongly on the fact that because the Owens patent has not been adjudicated, they can go on freely and merrily selling their books, preventing the plaintiffs from having the possibility of enjoying a fruitful market, and in that respect they estimate that whatever penalties they may have to pay in the future for their infringement will only be a fraction of the prestige they have gained by being self-professed pioneers in an industry that at the present time is one of great proportion.”
     “Your Honor knows that the 3-dimensional craze has seized this country in its grip,” Scheiman observed.  "Your Honor knows that while there is a tendency on the part of all of us to enjoy a fad or a fashion, these books will sell.”
     Then, obviously referring to Joe Kubert’s statements in the WRITER’S DIGEST article, “But Mr. Kubert, one of the inventors, said in a press release,” said Scheiman, “that by November there will be nothing left in the market. They are going to be sure that theirs are sold, and not their competitors, that their competitors will not have a free and equal chance to make a reasonable and proper profit.”

portion of WRITER'S DIGEST article (Aug. 1953) 

After acknowledging the fact that while he is not a patent attorney, Scheiman concludes that the defendants argument is, "...so much balderdash and nonsense...". Once again, he refers to Hanlin’s affidavit.
     "...a man whose integrity is clearly beyond reproach," Scheiman attests, "and I point to the contents of that affidavit as completely and significantly demonstrative of the fact that the Owens patent is entirely valid."
     He was much less impressed, though, by an affidavit supplied to the defendants by animator Paul Terry. In addition to being owner of Terrytoons Studios, Terry also licensed St. John to publish comic books based upon his cartoon characters. Including Mighty Mouse.

Paul Terry (July 13, 1951)
[Associated Press wire photo]

     This affidavit was what Posnack’s office presented to Scheiman late the preceding Wednesday. Scheiman asserts, “…that the only thing that impresses me in this affidavit is Mr. Terry’s residence, which is the Westchester Country Club, Rye, New York, and I envy him that.”
     Despite Schieman's flippant dismissal of Paul Terry's affidavit, there was no denying his animation credentials. Starting out in the studio of J.R. Bray and Earl Hurd, Terry had been witness to many of the earliest innovations in the industry. Bray had patented the method of making cartoons on translucent paper, a method cited by Terry as a predecessor of Owens' process.    
     “The affidavit is offered in a suggested attempt to demonstrate that the process described in the Owens patent was well known as far back as 1915. The affidavit,” claimed Scheiman, “was drawn in an inartistic attempt to convey the impression that one reading its contents would be impressed that such a process was indeed known to the animated cartoon industry in 1915.”  
     Scheiman disputes this by noting that, “ Mr. Owens’ patent states in its disclosure and in its specifications that its process involves the tracing of drawings on cells, which, in Mr. Owens’ language,is a well known process employed for many years in the animated cartoon industry.”

Detail from page 1 of the Owens patent

     Scheiman states that, “….the defendants either through ignorance, or, again, in an attempt to delude someone or some persons, suggested that that old process of tracing used in the animated cartoon industry is the Owens’ process. Nothing is further from the truth, and a close reading of Mr. Terry’s affidavit indicates that he said no such thing.”
     Scheiman then quotes Terry's affidavit at length.
     "As a result of my long experience, I am thoroughly familiar with the methods, processes and devices employed in the production of composite pictures having a stereoscopic, 3-dimensional effect."
     After granting that Terry is indeed familiar with such processes, Scheiman reads on, "Since 1915, I have actually used in  my various businesses and am still using a process relating to the creation of 3-dimensional effects from a drawing, whereby the final product, whether viewed through a stereoscope of some similar device, produce a final picture with a 3-dimensional or multi-planar effect."

John R. Bray's first patent, 
"Process of and Articles for Producing Moving Pictures"
(patent # 1107193)      

     Scheiman then makes a lengthy argument disputing Terry’s affidavit. He claims that Bray-Hurd patents referred to by Terry have been examined and contain no similarity to Owens’ except for, “…the simple expedient of tracing characters on transparent sheets.” He again notes Owens’ acknowledgement of that particular technique in his patent and to refute the defendants’ argument that it constituted “prior art”, a claim which, if proven, would devalue Owens’ patent. His counter argument once again, was Hanlin’s affidavit, which, Scheiman asserted, “…states that if there had been any such prior art he never would have granted the Owens (application) letter.”
     Scheiman finishes with, "There is nothing 3-dimensional about the Bray-Hurd process referred to by Mr. Terry. As I say, the affidavit is utterly insignificant, and if read in conjunction with the answering affidavits, the transparency of the argument is quite obvious.”
     This closes Scheiman’s presentation and the judge recesses the court until 2:15.
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 GAINES: He said Posnack has a civil suit all prepared to hit us with no matter what our process is.
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THE DEFENDANTS

     William Gaines had good reason to be concerned about Emanuel Posnack.
     The man knew his stuff.
     Not only did American Stereographic have a top notch patent attorney representing them, he was an inventor himself. Putting the engineering degree he acquired to good use, Posnack had patented everything from desk accessories, to a stapling machine. He even invented an exhaust system for industrial furnaces.
    
 
 Emanuel R. Posnack (circa 1951) 

     When court resumes in the afternoon session, the defendants’ attorney, Posnack, presents his case.
     “Your Honor, this motion is based upon a simple cause of action for patent infringement,” he began. "In such a case there are only two issues: The issues of infringement and validity. In the trial of a patent infringement suit the burden of proof as to infringement is, of course, upon the plaintiff.”
     As Posnack starts into a description of what is necessary to proof a plaintiff’s case in such matters, Judge Conger cuts him short. After a discussion of several similar cases, Conger then asks Posnack a question.
     “Any injunction that I might issue here, would that go beyond October 13th?”
     “It becomes a moot case,”
replies Posnack.
     “I  can only grant an injunction for a short time,” states the judge.
     “Up to October 13th. The question of damages is something else,” Posnack points out.
     As the judge pondered the usefulness of such a short-termed remedy, Posnack begins his attack on Scheiman's arguments by noting that there has been not, “…one word describing or comparing the process of the defendants with the claims of the patent, and I know of no other way in which infringement can be proven except by that comparison.”
     "We have a defense of non-infringement, we have a defense of invalidity," he stated flatly.
     Referring to the Bray patents, Posnack continued, "Our defense of invalidity is based upon prior art which we have discovered, which the Examiner (Hanlin) has never seen."
     "And we have even better," he offered, "We have an affidavit from one of the world's most famous cartoonists who swears he uses the very  same process which is described and has used it since 1915. Now, assuming that the affidavit of Paul Terry raises a doubt with respect to validity, I think that doubt is completely dispositive of this motion for a preliminary injunction.”
     But dismissing the validity of Owens' claim was not Posnack's whole case.
     “Up until the spring of this year the printing industry had never been able to produce a 3-dimensional effect from a drawing. Stereoptican pictures are old. Your Honor may remember the old stereoscopic arrangement that was known and practiced at the turn of the century.”
     “That was 3-dimensional,” notes Conger.
     “Yes, but that was taken from a photograph,” Posnack answers. “There were two pictures and when you looked through the stereoscope you saw a single picture giving the effect of real depth.”
     “Yes, my  grandmother had one,”
interjects the judge.
     “It dates back as long as my  grandmother’s time,” agrees Posnack. “Now, never has anyone been able as a practical matter to take a drawing on a flat sheet and give a multi-planar effect, as we call it. They tried it. And while they produced some effect, it was impossible to produce it on a mass production basis so that it could be printed.”
     “The defendant St. John Publishing is one of the oldest and most reputable publishing companies in this country,”
Posnack states emphatically, but with more than slight exaggeration. Although he had once been a crusading newspaper publisher thirty years earlier, Archer St. John's comic book company had only been in existence about six years.
     The judge inquires, “Are they responsible and reliable?”
     “Most reliable,”
assures Posnack, “and I don’t think it is questioned by the plaintiffs. Two of the employees, two of the artists who had been doing work for St. John, had together with another party developed and perfected a new technique for making 3-dimensional pictures for printing purposes. The presented this to the employer of two of them, St. John, and when he saw the process he was impressed, impressed to the point of putting in in, in the last few months, close to a million dollars in the production of publications showing this 3-dimensional effect.”
     “Success was instantaneous and dramatic. I was the attorney for the inventors, as well as for the St. John Publishing Company. I was instructed to file patent applications and to file a petition to make the case a special one so to expedite the consideration. That was done. Patents are now pending. Your Honor knows it takes time for a patent to issue.”
     Posnack continued.
     “In the meantime, since St. John had decided to expedite this, a company was formed, the American Stereographic Corporation, whose main objective was to do this, to help in the perfection of the process, to surevise licensees in their use of the process, and to license others. Licenses were offered to all.“
     Then Posnack makes one of his main points.
     “Included among those who were interested was this very plaintiff Gaines and all his corporations that are producing various publications. At the time they negotiated with the St. John Publishing Company or with American Stereographic Company, they did not know and did not have the Owens patent, which is the patent in suit.”
     The judge seems surprised. “I did not hear that,” he states. Posnack goes on.
     “At the time the plaintiff Gaines was negotiating with the defendants for a license under the defendants’ Illustereo process, Gaines did not have the patent in suit; it was only after the negotiations fell through that he sought and found this patent.”
     “Was he an assignee of the patent?”, Judge Conger asks.
     "He became an assignee either of the whole patent or certain rights," Posnack replied uncertainly, "I did not get that clear."
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          FELDSTEIN: ...So we had to buy the patent. We didn’t exactly buy the patent. We bought the exclusive assignment. 
          KUBERT: So he let it go for three bills, huh?
          FELDSTEIN: That’s right. We would have paid a thousand.
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     “Since that date," Posnack went on,  "the St. John Publishing Company has published many more of the 3-dimensional comics, and intends to publish more, under this new special technique. The plaintiffs have not as yet published a single 3-dimensional book.”
     “What was Gaines offered in his negotiations with the defendants? He was offered, just as every other publisher in the country was offered, a license to practice a secret process under a confidential disclosure. Gaines refused to accept certain of the obligations of a licensee with respect to confidential disclosure and, as I said, the negotiations fell through.”
     "In the motion papers Gaines is now challenging the defendants to disclose the process which they refuse to do. That is the general background picture."
     Posnack was well aware of the disclosure language in the licensing agreement. He wrote it. By signing the agreement, a licensee was legally required to keep the Illustereo process a secret. At the time of this trial, Gaines still didn't know for sure what that process entailed, making the claim that it infringed upon the Owens patent difficult to prove.       
     “This patent has never been adjudicated," Posnack continued,  "For almost 17 years of its entire life it has never been commercially exploited or used. It is known in patent parlance as a paper patent, unknown, unused, unadjudicated. The plaintiffs now wave this piece of paper at the Court and over the heads of these defendants and their proposed licensees and seek to destroy the terrific investment made by the defendants.”
     "We say, in the first place, that because the patent has not been adjudicated, there is no basis whatsoever for a preliminary injunction..." .
     “It seems to me that Mr. Scheiman, plaintiff’s counsel, was a bit na├»ve when he referred to the very Examiner (Hanlin) who passed upon the patent as proof of the validity of the patent," Posnack suggested,  "I think if an examiner’s word was sacred not a single patent would ever be adjudicated by the courts.”
     Posnack goes on to make the point that Hanlin was unaware of other prior art that would have never allowed issuance of Owen’s patent. Although he doesn’t go into all of the aspects he claims are similar between Owens’ patent and the method used by Paul Terry, he does point to one similarity.
     “All of the affidavits of the plaintiff indicate that the Owens patent relies upon a shifting of the cellophane sheets. First a stack of sheets are placed one upon the other, being transparent, and a picture is taken. Then there is a shifting of these sheets relative with each other. The picture looks different. Another photograph is taken. From that a combined effect is obtained which is 3-dimensional. Mr. Terry swears that that same series of steps which he sets forth in detail has been used by him. I rely upon that.”
     Posnack then confronts the claim of infringement; a claim he dismisses out of hand.
     “There is not a single statement made by the plaintiffs in the affidavits which indicates that anyone has seen the defendants’ process, which is held secret.”
     "Never seen what?", Conger asks.
     "The defendants' process," Posnack replied. "In other words, the plaintiffs charge that the Illustereo process infringes the patent. In order to prove infringement they must know the process. Not one of the affiants has stated that he saw the process in actual use. What did they say? The first group of affiants looked at the final product, which is not the patented process, and deduced it was made by this process, which is utterly inadequate for any suit."
__________________________________________________________
GAINES:  ...It took me about an hour to figure out what I thought I could produce...a way I thought I could produce a book to look exactly like the book you had produced.
__________________________________________________________

     “Two days ago a new witness was obtained by the plaintiffs," said Posnack, in reference to an affidavit sworn to by artist Bill Elder,  "He set forth in detail conversations he had with one of the defendants. Some steps he states he saw. Others he states he heard about. I submit, your Honor, it is utterly unfair and unjust and inequitable to decide a patent infringement suit in favor of the plaintiffs based upon such hearsay testimony without a single bit of evidence to show what the process consisted of.”
     “There is no actual proof of infringement. There is, on the other hand, positive evidence of non-infringement. The patent has never been adjudicated. The patent is invalid by the evidence which we have in our affidavits. For almost 17 years of the patent’s existence it has never been commercially exploited or used. The affidavits on behalf of the defendant American Stereoscopic (sic) Corporation indicate that a patent application for its process has been filed, and in order to expedite the issuance of the patent an application therefore has been made special.”
     “The defendants have been the first to exploit, popularize, and make successful 3-dimensional comics. The plaintiffs are utter newcomers in the field of 3-dimensional publications and are seeking unfairly to profit from defendants’ successful pioneering efforts.”
     “I submit for these reasons that this suit for preliminary injunction be denied.”
     With that, the plaintiff’s attorney Scheiman requested a rebuttal.
     “There is an affidavit before the Court given by Mr. Elder, who states that at the defendants’ offices on a particular day the defendants instructed him in the very process employed by them, step by step, making use of demonstrable exhibits that were employed by the defendants in the production of their first 3-dimensional book, “Mighty Mouse”. There is absolutely no question of hearsay evidence. There is no question of incomplete knowledge. There is direct proof by the defendants to this affiant stating what the process is. There can be no question with respect to identity of the process.”
     Scheiman refuted Posnack's test of validity by first agreeing with its necessity.
     "I agree with Mr. Posnack that it is necessary to prove a valid patent. I think that the proof of that validity is encompassed in the affidavits before this Court. There is no proper attack upon the validity of the patent in any of the answering patents."
     Continuing on, Scheiman pointed out that, "...the prior art referred to in the Terry affidavit is," as he stated earlier, "related to animated cartoons in the two dimensions."
     "Mr. Terry never produced prior to 1936, when the Owens application was filed, any 3-dimensional animated cartoons. I am prepared with exhibits and demonstrable apparatus in this courtroom to show this Court exactly what Mr. Terry has done. I realize time does not permit of any such demonstration at this moment. But I would gladly and happily proffer it."
     Having avoided subjecting the courtroom to a showing of Farmer Alfalfa cartoons, Scheiman goes on.
      "The Terry affidavit is self-serving, confusing in its contents, and by reference to motion picture patents goes clearly beyond the field of art that is in purview here, at least with respect to the process here, which was never employed by Mr. Terry at any time in the production of any of his motion pictures.”
     Scheiman avers the originality of Owens’ patent as, "...a unique process whereby a drawing just like the drawings that were used in the defendants' publications could be traced onto separate cells, photographed so as to create the image as would be seen by one eye; the cells would then be shifted laterally with reference to each other and for a background view so that a photograph could then be taken with the other eye."
     "By use of Mr. Owens' process the two complimentary pictures were obtained. These complimentary stereoscopic pictures are then available for reproduction and were available for reproduction when Owens invented the process.
     To counter Posnack's contention that Owens' invention was merely a "paper patent", Scheiman offered, "There is no doubt that Mr. Owens did not publish a 3-dimensional comic book in the form of "Mighty Mouse. The papers, his own affidavit, indicate that when he in 1936 attempted to exploit his invention, the people whom he approached were no longer interested in printing 3-dimensional material because there was no market for it at the time."
     While making a point comparing Owens’ patent to the pending Illustereo process, Scheiman parenthetically mentions,“…that the defendants have never shown us that application,” in an effort to cast doubt that it had even been subjected for patent consideration.

    
Will Elder (seated) and John Severin
from FRONTLINE COMBAT #5 (March-April 1952) 

     Scheiman once again asserts that nothing Posnack presented, in any way cast doubt upon the patent’s validity. And secondly, “…the proof of the infringement lies in the affidavits on file, particularly the affidavit of William Elder, served upon the defendants a couple of days ago, in which he states under oath that on June 18, 1953, at the office of American Stereographic Corporation, with an address given in that affidavit, that the defendants, two of the inventors of the so-called process, there having been three in the first instance, instructed this Mr. Elder in the exact technique employed by them to create the “Mighty Mouse” publication.”
     “The affidavit states that they showed him the artwork that was involved in the creation of that “Mighty Mouse”, showed him the several cells, explained to him how they were assembled after they were created, explained to him the unique shifting technique that is the heart of the Owens patent, showed him that the “Mighty Mouse” itself was merely the product of the use of that process and the wonderful invention of printing that has existed for hundreds of years.”
     After once again pointing out that the defendants, “…do not have any patent application that can be granted at any time with respect to the process used by them to create “Mighty Mouse”, Scheiman asserts that, "it will be established beyond any doubt that the defendants have unlawfully, or at least, improperly usurped to themselves profits and rewards of the Owens invention that have no business being in their pockets. While, as I stated before, your Honor, they will be held responsible for pecuniary damage at the proper time, it is extremely unfortunate that while the defendants are reaping their rewards, the plaintiff is put in the position of having to meet this competition of the defendants."
     "The plaintiff hopes to have its publication reach the newsstands during this month, probably about September 20th, and that is being issued in the wake of a flood of Illustereo products, comic books, five or six in number, the last of which hit the New York newsstands yesterday."
     In actuality, E.C. didn't come close to that September date. Their first 3-D comic, THREE DIMENSION E.C. CLASSICS #1, was released with a Spring 1954, cover date late in 1953.
     "So great is the marketing of the defendants' products that the plaintiff corporations will have a very, very difficult time obtaining any financial return from their substantial investment."
     "I think that on an application for a preliminary injunction the equity should be regarded from both points of view, not from the defendants' point of view alone. If they made a mistake or if they were corrupt, whichever it may be, and made improper use of an invention, they should not be permitted to go along for the ride, they should not be permitted to continue on indefinitely, capitalizing on an improper and immoral act."
     "Bear in mind, your Honor, that these are competing companies. The plaintiff companies were in existence long before the defendant St. John; the plaintiff companies were the pioneer of comic books. These companies were founded by the plaintiff Gaines’ father, and the prestige which the St. John Company is now attempting to achieve through this immoral, improper and illegal act is being denied the plaintiffs. What good will come to the plaintiffs at a trial later on? The damage will have been done by illegal, improper and unlawful distribution of 3-dimensional comic books to a point where it will be virtually impossible, according to the defendants' own statements attached to the motion papers, to sell these books."
     Once again Scheiman cites Kubert's comments in the WRITER'S DIGEST article.
     “The defendants said that by October or November it will be practically impossible to do any business in that field. This is a passing fad, a passing fancy. The plaintiffs are being denied it merely because they proceeded in an honorable, in a proper, in a lawful manner to operate under the patent of an inventor who licensed them for that purpose.”
     “These defendants have on color of right; they have no title; they have no authority; they are usurpers; they are newcomers; they are the ones who have achieved and are achieving the fruits and labors and rewards that belong to Owens and his licensees.”
     “Mr. Posnack suggests that every one of the comic book publishers in the City of New York or elsewhere was given the opportunity to have a license. The fact remains, Judge, that St. John is the only one who has a license under this so-called Illustereo process.”
“Nobody else took a license because of the terms. I suggest to your Honor, as the moving papers show, that the defendants never intended any such license agreement to be accepted by anybody.”
     With that, the court adjourns to await Judge Conger's decision.
__________________________________________________________

THE DECISION

     On September 30, 1953, Judge Conger handed down his decision. What follows is an abridged version.

This is a motion for a preliminary injunction restraining the defendants from making and distributing three-dimensional comic books or magazines produced by a certain "3-D Illustereo" process upon the ground that said process infringes United States Letters Patent No. 2,057,051 issued to plaintiff Owens on October 13, 1936.

The plaintiffs have filed various exhibits as well as a number of affidavits in support of their motion.


According to the affidavit of the plaintiff Gaines, the corporate plaintiffs are well known publishers of comic books and he is well acquainted with the efforts involved in the production and knowledge of stereoscopy and the aspects of its production through the medium of photography; he is the assignee of the Owens patent and has made a study of it. He sets forth his analysis of the patent which is entitled "Methods of Drawing and Photographing Stereoscopic Pictures in Relief"...
 

The Owens patent technique embraces according to Gaines the following production steps:
 

"(a) analyzing the drawing and breaking it down into the desired number of planes;
 

"(b) copying each plane, either by hand or photographically, on to a separate sheet or transparent cell (acetate, celluloid or the like) or a combination thereof, and, in the case of transparent cells, opaquing the areas covered with white where and if desired;
 

"(c) superimposing the sheets and/or cells in register to simulate the original drawing and then copying photographically;
 

"(d) shifting the sheets and/or cells laterally with reference to the background so that each sheet or cell is shifted slightly more in reference to the preceding one, which shift distances may be varied in amounts and in proportion to each other, and then copying the composite result photographically;
 

"(e) the photographic copies produced or obtained through steps (c) and (d) above described are then reproduced for visual observation.
 

"Reproduction for visual observation is achieved in the following manner: plates are made from each of the two photographic copies referred to in the process outlined above; one being usually inked in red and the other in green, and a printing is then made with the impression of each plate superimposed. When viewed through color filters of the same two colors that the said plates were respectively inked in, a three dimensional effect is obtained through the application of well-known and, concededly (sic), not now patentable principles of `stereo-anaglyph' viewing."
 

He reminds the Court of the "3-D" craze and the profits to be reaped, and he describes the efforts of the defendants in marketing the "World's First Three Dimension Comics" under a so-called secret "illustereo" process for which patent application is pending; he further describes his negotiations with defendant for a license to employ the process in his own publications and his refusal to accept the same because of the conditions imposed therein; he charges that the defendants actually never had intention of licensing anyone other than St. John Publishing Company and that defendants are out to corner the market in 3-D comic books; he cites an announcement in a trade magazine by one of the defendants and inventors, Kubert, to the effect that there will be an immediate but short-lived market for 3-D comics and "then it will be all over"; the announcement also refers to the problem of acquiring glasses for the comic books because of the limited supply of acetate in New York; this points up the difficulty because it takes Gaines' companies several months to produce a 3-D comic book.
 

Mr. Gaines' affidavit further goes on to relate his discovery, during the course of the license negotiations, of Owens' patent; that he became absolutely convinced the defendants were employing the Owens process; and he is equally convinced the defendants infringe the Owens patent since the "naked eye tells the story"; he studied defendants' work and can't think of any method other than Owens' that might have accomplished the result.
 

Mr. Gaines' affidavit winds up by "challenging" defendants to admit or deny the use of certain practices in their production and pleads the necessity of the relief sought, because of the defendants continuing publication despite full notice of plaintiffs' rights, the limited (in time) market, the limited source of supplies created by defendants' activities and the fact that the Owens patent expires October 13, 1953.
 

The affidavit of plaintiff Owens recites, among other things, his invention, his belief that defendants infringe, his failure ever successfully to promote the patent, or to receive one penny from it, his experience as an inventor, his introduction to the defendants' claimed infringing production, the receipt of a visit from plaintiff Gaines and subsequent conversations with the latter after which he assigned his patent to Gaines, his notification to defendants of infringement and various replies. He has no doubt that defendants use his technique in their productions, for the same reasons Gaines gives.
 

One Feldstein, a commercial artist and employee of the plaintiff corporations, also expresses the opinion that "only one of the methods invented, taught and detailed in the Owens patent could have been used in the production of that (`Mighty Mouse') comic book ****
 

Further, one George Hanlin files an affidavit in support of the application. Hanlin is no less than the Government patent examiner, now retired, who examined and allowed the Owens patent in 1936. It is his opinion that the Owens patent was and is valid in every way. This opinion results from a refreshed recollection and further study by Mr. Hanlin. He is further of the opinion that if defendants use certain processes in producing their comic books, they infringe the Owens patent.
 

One Elder, a commercial artist, formerly a free-lancer, but now employed by the plaintiff corporation, relates that he visited the offices of American Stereographic Corporation in June of this year and that defendants Kubert and Norman Maurer explained to him the process by which defendants' comic book "Mighty Mouse" had been produced. He is of the opinion that it "is undoubtedly the process invented and taught by Mr. Owens."
 

One exhibit is a transcript of a tape recorded interview between defendant Kubert and plaintiff Gaines and plaintiff corporations' employee Feldstein at Gaines' office in August of this year. It appears that Kubert was invited to Gaines' office by Gaines and/or Feldstein for a little chat and, unknown to Kubert, the conversation was tape recorded — 70 pages in all.
 

I read the entire transcript. Without giving consideration to its propriety or admissibility — plaintiffs have filed a memorandum in support of the submission — I can only conclude that it completely establishes that Kubert was innocent of any wrongdoing in connection with Owens' patent and the publication of defendants' 3-D comic books. Further, I regard it as worthless in establishing any impropriety on the other defendants' part. The conversation consisted mainly of Gaines' and Feldstein's relation to Kubert of what they had learned, suspected, speculated and otherwise. Kubert was astonished by some of the revelations but he was unaware of wrongdoing on his own part or anybody else's, except possibly, if what he was told was true, a certain lawyer's part.
 

The defendants have filed affidavits in opposition to the application.
 

Leon (Leonard) H. Maurer, general manager of the defendant American Stereographic Corporation, states that he, in conjunction with Norman A. Maurer and Joseph Kubert, invented the process whereby defendants produce 3-D comic books; that a patent has been applied for along with a petition for "special" attention in order to expedite the application; that defendants sought to license Gaines and his companies but the latter would not agree to the conditions in connection with secrecy of the process; he states that Owens' patent has no relation to defendants' process; he is of the opinion, after study, that the Owens patent is and always was invalid in view of the prior art which he purports to cite; that the St. John Publishing Company has invested three-quarters of a million dollars in the project and the plaintiffs have yet to produce a comic book.
 

Archer St. John relates his part in the production, his substantial investment, the great success of the venture, his belief after investigation that his process infringed no patent, among other things.
 

Norman H. Maurer states that he is a coinventor of the Illustereo process; that it is different than the disclosures of the Owens patent; and that such Owens process is not capable of producing a product of the quality of defendants' comic book.
 

Paul Terry, a producer of well-known animated motion picture cartoons, states that he has used, since 1915, a process relating to the creation of 3-D effects from a drawing which process is described in many old patents, which he cites.
 

I believe I have given the highlights of the various affidavits and I have considered the exhibits.
 

I am convinced that the plaintiffs have not made a case for the relief sought.
 

I shall assume for the purposes of this application that the Owens patent is valid.
 

It is plain from all the circumstances, however, that defendants' infringement of the Owens patent is not reasonably clear, if at all.
 

Only Elder among the affiants in support of the application has any knowledge of defendants' process. Gaines and others cannot think of any method other than disclosed in the Owens patent to do the job. Hanlin says in effect that if the defendants use the Owens method they infringe the Owens patent.
 

Elder's affidavit remains practically unanswered. Of course, in general the defendants deny using the Owens patent, aver that the Owens method has no relation to their own and have their own invention for which they seek a patent. But they do not deny that their method was explained to Elder nor do they counteract Elder's opinion that it is the Owens method. This circumstance along with others raises a suspicion that the defendants may have appropriated Owens' work. I do not, however, regard it as clear proof of infringement in view of defendants' denials and averments, and particularly since defendants have seen fit to file their own "invention" in the patent office.
 

This doubt coupled with the fact that the plaintiffs will not be irreparably damaged by defendants' continued production compels me to deny this application. There appears to be no question that the defendants are financially secure and well able to compensate plaintiffs if and when they are successful in this suit. It may well be three years before it reaches trial, yet the patent will be in the public domain within a month. Even assuming that the defendants saturate the market within a short time, it may not be said that they are sole contributors to this circumstance since it appears that at least one other company is in the field.
 

The application is denied.
 _________________________________________________________

THE AFTERMATH

     With the Sturm und Drang past, when the dust settled, in the end, nobody really won. 
     Despite their loss, Gaines and Feldstein eventually published their two 3-D comics. Despite their win, American Stereographic eventually folded; from lack of customers for their process and the predictable fading of the 3-D fad.
     Although Archer St. John probably lost as much as he had made on this debacle, he didn't go out of business. While his comic book company withered, along with the rest of the industry at that time, his other publishing ventures did well. Right up to his death by drug overdose on August 13, 1955.
     In addition to his continued success as a patent lawyer, Emanuel Posnack wrote several books on economics. His 1956 book, WORLD WITHOUT BARRIERS, proposed a theory of a global economy that presaged events decades later. 
     William Gaines would go on to other battles, including an ill-advised one with the Senate subcommittee investigating juvenile delinquency. A lesser skirmish with a lesser foe was fought by his attorney in December of 1953.
     Massachusetts Attorney General George Fingold, citing the depiction of Christmas in a "pagan" manner and Santa Claus as being divorced, had copies of E.C.'s PANIC #1 pulled off the stands. Gaines' lawyer, Martin Scheiman, decried the "wanton damage" suffered by his client, inflicted by people who had "come to the rescue of a wholly imaginary, mythological creature rarely believed to exist by children more than a few years old."  4 
     He would go on to represent Gaines in far more serious cases including a copyright infringement suit over the image of Alfred E. Neuman and Irving Berlin's attempt to prevent MAD from using his songs in their parodies.
     Scheiman, who counted Gaines cohort Lyle Stuart and radical publisher Paul Krasner among his clients, would be found dead in the Time-Life Building in 1966, an apparent suicide.
     And Freeman H. Owens, the inventor who Gaines had told Kubert in 1953, "...is so near to death. He’s had seven strokes. He’s an old man…a little old man," continued inventing until he died at age 89 in 1979.
__________________________________________________________

BONUS MATERIAL DEPT.

     Proving that a little thing like an expensive lawsuit couldn't stop their respective creative juices from flowing, both St. John and E.C. published humorous takes on the 3-D comics saga. Presented here, for not-for-profit historical purposes only, are "The 3-D-T's" from WHACK #2 and the first page of  "3-Dimensions!" from MAD #12. All copyrights are retained by the estate of William M. Gaines and all other respective copyright holders. 

   
  "The 3-D-T's"  
WHACK #2 (Dec. 1953) pg. 1

   
  pg. 2

   
  pg. 3

   
  pg. 4

   
  pg. 5

   
  pg. 6

[the following image courtesy of Ger Apeldoorn]

   
"3-Dimensions!"
MAD #12 (June 1954) pg. 1
 
__________________________________________________________

1  All quotes of Martin Scheiman and Emanuel Posnack come from the court stenographer's notes for OWENS v. AMERICAN STEREOGRAPHIC CORP., et. al.,United States District Court S. D. New York, Sept. 1-11, 1953.

2  Zone, Ray, "Leonard Maurer: 3-D Comics Pioneer"http://www.ray3dzone.com/LM.html
3 Mathieu, Aron M., "3-D Comics Knock 'Em Dead", WRITER'S DIGEST, Aug. 1953.

"Santa Claus Cartoon Damages Are Charged", PALM BEACH POST, Dec. 28, 1953.

Additional general information obtained from the NEW YORK TIMES archives, HOLLYWOOD ON THE HUDSON by Richard Koszarski, ARKANSAS BIOGRAPHY: A COLLECTION OF NOTABLE LIVES by Nancy A. Williams and Jeannie M. Whayne and the online Google patent search engine.

4 comments:

  1. Had I been the judge then, regardless of what else I might have ruled, I would exploded in response to any claim that the Bray process was essentially the same thing as Owen's invention.

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  2. Great summation! One thing was new to me: that St. John died of a drug overdose. I miss a little red number there - what is your source for that? I'd love to know more...

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  3. That claim came from Paul Terry's affidavit, which was included, I'm sure, for the sake of his "star power" alone.

    To be fair, though, there were shaky claims made all around in this case!

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  4. The information about Archer St. John's death came from an Associated Press article that ran in several newspapers a few days after he was found dead.

    According to the article, an autopsy found, "congestion of the viscera (internal organs) pending chemical analysis". That was the language used at that time to indicate a suspected drug overdose. Likely sleeping pills.

    My most immediate source for this, Ger, was my article about St. John that appeared in ALTER EGO #77.

    ReplyDelete