The opinion of the court was delivered by: HIGGINBOTHAM
This matter is before the Court on cross motions for summary judgment on the first and second counts of plaintiff's Complaint, and on defendant's motion to dismiss the third count for failure to state a cause of action.
The first two counts allege defendant's breach of a tripartite agreement entered into on July 25, 1957, by Dyotherm Corporation, Turbo Machine Company, and Messrs. Grant H. and Harry E. Brewin.
The agreement is in settlement of a suit initiated by Dyotherm against Turbo. Civil No. 22,232, E.D.Pa., March 13, 1957. It provides, inter alia:
'2. The parties agree to the dismissal with prejudice of the complaint and counterclaim in the above action * * *.
'3. DYOTHERM hereby grants to the BREWINS, their heirs, executors or administrators, the following rights for North and South America and Japan, and nowhere else, pertaining to the subject matter of the following United States patent applications * * *.' (Emphasis added)
Particular rights to manufacture and sell are then set forth. Paragraph 3(d) states: 'All of the said licenses to the BREWINS include the right to grant sublicenses.'
'The BREWINS shall relicense the rights for which they are licensed under the terms of this agreement to TURBO for a consideration to be agreed upon by the BREWINS and TURBO * * *.'
Plaintiff alleges in count one that defendant has manufactured and sold certain machines covered by the agreement in areas throughout the world other than North and South America and Japan.
The parties in this cause have stipulated that plaintiff's right to recover on the first count will be determined solely on the following issue:
'Whether the settlement agreement of July 25, 1957, together with the accompanying relicense agreement extending from the Brewins to Turbo:
'(a) As plaintiff contends, forbids Turbo from manufacturing its accused dye boarder within or without the United States of America for sale outside of North America, South America or Japan, or
'(b) As defendant contends, does not so forbid Turbo but limits the license granted so that any manufacture of its accused dye boarder for sale outside North ...