with those conditions, he loses the protection of his license and becomes an infringer (citations omitted). The principle seems to be that the license is limited in its operation, and that, since in the case of a territorial limit the license has no existence in the exempted territory, so in case of other limitations the license has no existence in the exempted field."
The Court, in further explanation of the principle, said, 190 F. at page 584:
"* * * If the complainant had licensed defendant to manufacture and sell machines in Indiana, but not elsewhere, and had then learned that the defendant was manufacturing and selling in Michigan, it might, and probably would, file an ordinary, plain infringement bill. Such a license could not then be urged by defendant as any defense, because it would not be pertinent to the act complained of; and so it would seem that, in such a bill, complainant could take nothing whatever from the existence of the license. It would be substantially accurate to say that the license did not exist in Michigan.
"The estoppel must be mutual. The licensee may not deny the patentee's title to the monopoly; the patentee may not deny the licensee's right to act under that monopoly. It is difficult to see how, when the act involved in the manufacture of a certain machine, at a specified place or in a specified way, and both complainant and defendant agree that there is no contract in existence permitting the act in controversy, either party can be estopped by a contract relating to something else.
"* * * It seems to me quite clear that the complaining patentee cannot, at the same time, maintain the position that the act of the defendant licensee, manufacturing what is said to be the patented article, is outside the conditions of the license, and, therefore, not authorized by the license, and also the position that his title to the monopoly is conceded by the license and, therefore, cannot be disputed."
This principle, as quoted, was followed and applied by Judge Kirkpatrick in the case of Chance v. Lehigh Nav. Coal Co., supra, and is apparently the rule of this circuit. That case is, likewise, apposite here.
The defendant in the instant case acquired nothing under the license agreement except a limited license to use the invention of the patent in its mills at Hudson Falls, New York. The consequent estoppel is co-extensive only with this limited right and may be invoked only to protect and enforce the right of the plaintiff to his lawful compensation under the license agreement. The only use of the invention, of which the plaintiff complains, was the use by the defendant in its mills at Savannah, Georgia. This use is the sole basis of the present action. It is alleged in the complaint, and sustained by the undisputed testimony, that this use of the invention was not within the purview of the license agreement. It would seem to follow that under these circumstances, and under the settled law, the estoppel cannot be invoked against the defendant to bar an otherwise available lawful defense. Indiana Mfg. Co. v. Nichols & Shepard Co.; Chance v. Lehigh Nav. Coal Co.; International Burr Corp. v. Wood Grinding Service; Sinko Tool & Mfg. Co. v. Casco Products Corp., all supra. The license agreement is, in fact, irrelevant.
The plaintiff, apparently recognizing that an estoppel does not extent beyond the scope of the license agreement, contends that the agreement of the defendant "to respect the patent rights of the plaintiff" is an unconditional promise, implied, if not express, not to contest the validity of the patent. A reasonable interpretation of the quoted language, read and considered in the light of the related provisions, as it must be, will not sustain this construction. This construction would obviously extend the estoppel beyond the scope of the license agreement, and we are not inclined to adopt it in the absence of an unequivocal recital from which it might at least be inferred that this was the manifest intention of the parties. It cannot be said that the quoted language meets this strict requirement.
An estoppel by contract presupposes the unconditional waiver of a legal right or defense and cannot be predicated upon an ambiguous statement which leaves the waiver doubtful or uncertain. "To work an estoppel, a recital must clearly, with particularity, beyond doubt and without ambiguity, affirm or deny some present or past fact or admit some liability definitely stated. It must be certain to every intent and cannot be taken by argument or inference; and, if the fact be not directly or precisely affirmed or recited, it shall not be an estoppel. Before an admission or recital can have such an effect, it must be so certain as to admit of no other conclusion." City of Chicago v. Joseph, 7 Cir., 95 F.2d 444, 446, certiorari denied 304 U.S. 578, 58 S. Ct. 1049, 82 L. Ed. 1542; Eskimo Pie Corp. v. National Ice Cream Co., 6 Cir., 26 F.2d 901, 902. The ambiguity, if any, must be resolved against the party invoking the estoppel, especially where, as here, the contract has been prepared under his supervision.
The findings of fact and conclusions of law required by Rule 52 of the Rules of Civil Procedure, 28 U.S.C.A. following section 723c, will be prepared and filed by the Court.