## Facts

- E. Edelmann & Co. owned U.S. Patent No. 1,800,139 covering a hydrometer-type device.
- Triple-A Specialty Co. manufactured and sold a competing hydrometer device.
- Edelmann accused Triple-A of infringing the patent and communicated those accusations to Triple-A’s customers and prospective customers, stating that suits would be brought unless the alleged infringement ceased.
- Triple-A filed a federal declaratory judgment action seeking a declaration of noninfringement (and potentially invalidity) and injunctive relief against Edelmann’s dissemination of infringement accusations to the trade.
- The parties lacked diversity of citizenship, so jurisdiction depended on whether the action “arose under” the patent laws.
- The district court held it had jurisdiction, declined to decide patent validity, declared Triple-A’s device did not infringe, and ordered an accounting for damages caused by Edelmann’s wrongful infringement charges.

## Issues

1. Whether a declaratory judgment action by an accused infringer seeking a declaration of noninfringement (and possibly invalidity) is a case “arising under” the patent laws, supporting federal jurisdiction without diversity.
2. Whether Triple-A’s hydrometer device infringed Edelmann’s patent.

## Decision

- The Seventh Circuit affirmed the district court’s decree.
- The court held the case arose under the patent laws because there was an actual controversy over infringement and the dispute was the same substantive patent controversy that would exist in a coercive infringement suit, with the parties’ roles reversed.
- The court left undisturbed the determination that Triple-A’s device did not infringe.
- The court affirmed relief that included an accounting for damages attributable to Edelmann’s wrongful infringement accusations.

## Legal Principles

- The Declaratory Judgment Act is procedural and supplies an additional remedy; it does not create substantive rights or independently expand federal subject-matter jurisdiction.
- “Arising under” analysis focuses on the underlying substantive controversy; when the threatened enforcement would be a patent infringement action, a declaratory suit resolving that dispute arises under the patent laws.
- An “actual controversy” exists in a patent declaratory action where the patentee has asserted infringement and threatened enforcement in a manner creating a real and immediate dispute affecting the accused party’s business.

## Conclusion

The Seventh Circuit held that an accused infringer may invoke declaratory relief in federal court to resolve a genuine patent infringement dispute when the patentee has asserted infringement and threatened suit, and it affirmed a declaration of noninfringement and related remedial relief for harm caused by wrongful infringement accusations.


E. Edelmann & Co. v. Triple-A Specialty Co., 88 F.2d 852 (7th Cir. 1937)