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These shareholders were the only members of Cascade's board
of directors, and each retained his ownership percentage until
1991.
The 1979 Sales Agreement and Patent Assignment
On January 9, 1979, Lea entered into an agreement (the 1979
sales agreement) with Cascade to sell "his entire right, title
and interest in and to" the 525, the 690, and the 974 patents,
U.S. Patent Application S.N. 800,288 (the patent application for
the "Method of Making Self-Inflating Air Mattress"), and the
British and Japanese patent applications for the mattress.2 The
1979 sales agreement, in relevant part, provided the following:
a. The total sales price for such sale is three
hundred thousand dollars ($300,000). Since it is
recognized that Cascade Designs, Inc. does not at this
time have the resources to make a cash payment of
$300,000, it is agreed that payment can be made only
out of the money received by Cascade Designs for sales
of the air mattresses which it markets.
Payment shall be made as follows:
1. For each air mattress sold by Cascade Designs,
Inc., covered by any one of the patents or patent
applications noted above, James M. Lea shall receive an
amount of money equal to 5% of the gross selling price.
* * * * * * *
b. Payments shall continue to be paid as
2Anderson sold his interests in the 525 and the 974 patents,
and the U.S., British, and Japanese patent applications, on Jan.
7, 1979, for 0.134 percent of the gross sales price of each air
mattress. Payments made to Anderson for these properties are not
at issue in this case.
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Last modified: May 25, 2011