such breach having occurred before receipt of cargo on board the vessel. Libel dismissed.

Everett, Clarke & Benedict, of New York City (Walter C. Elliott and Herman S. Hertwig, both of New York City, of counsel), for

libelant.

Emory R. Buckner, U. S. Atty., of New York City (Horace M. Gray, of New York City, of counsel), for the United States.

THACHER, District Judge. In sustaining exceptions to the original libel Judge A. N. Hand held that a suit such as this, purely in personam, could be maintained under the Suits in Admiralty Act (Comp. St. §§ 1251-12517), but that it was necessary in such a suit for the plaintiff to allege and prove its residence or place of business in the district where suit is brought. Galban Lobo & Co. v. U. S. (D. C.) 285 F. 665. The libel was thereafter amended to allege that the libelant, a Cuban corporation, had a principal place of business in New York City. Upon the trial, the proofs disclosed that the libelant was a corporation organized and existing under the laws of Cuba, and there engaged in business as an exporter of raw sugar. This corporation never had an office in New York City, or elsewhere in the United States.

For a number of years Olavarria & Co., Inc., a New York corporation having an office of its own in New York City, has in its own name made contracts for the sale of sugar for account of the libelant, which the libelant has performed by shipping the sugars from Cuba, and has purchased other merchandise in the United States in its own name, which it has shipped to the libelant in Cuba. This business has been conducted upon a commission basis. All that is done in New York is, in substance as well as in form, the business of Olavarria & Co., carried on in its own office, by its own officers, agents, and employees. The rent, salaries, and all other expenses of conducting its business in the United States are paid by Olavarria & Co. The only charges to the libelant are the commissions paid upon the transactions which result. The libelant exercises no direction or control over the business conducted in the New York office of Olavarria & Co., and it does not appear that that office has ever been used by any person in the employ of the libelant for any business purpose.

[1] The only claim that the libelant does any business here is founded upon the execution of contracts for the sale of sugar by Olavar ria & Co. in its own name, but for the account of the libelant. Something more than the execution of such contracts by an independent agency, which maintains its own office in its own name, is necessary to support the claim that the libelant has a place of business in New York. It is possible to do business here, without having a place of business here, and when a foreign corporation does its business. through correspondence with an American corporation, even if the business be done upon an agency or commission basis, it cannot properly be said to have a place of business here, unless the case is one in which the corporate distinction between the two companies is so purely formal as to be properly disregarded. The facts do not warrant any such ruling in this case. Peterson v. Chicago, Rock Island & Pac. Ry., 205 U. S. 364, 27 S. Ct. 513, 51 L. Ed. 841; Peoples Tobacco Co. V. American Tobacco Co., 246 U. S. 79, 38 S. Ct. 233, 62 L. Ed. 587, Ann. Cas. 1918Ć, 537; Smithson v. Roneo, Ltd. (D. C.) 231 F. 349. [2] The court is urged to disregard the ruling of Judge Hand in sustaining the excep tions to the original libel herein, because it is argued that there has been a change in the law under the decisions of the Supreme Court of the United States in Nahmeh v. U. S., 267 U. S. 122, 45 S. Ct. 277, 69 L. Ed. 536, and Blamberg Bros. v. U. S., 260 U. S. 452, 43 S. Ct. 179, 67 L. Ed. 346. Judge Hand's decision is the law of this case until modified or reversed on appeal. If it were not, I should still have no hesitation in following it; for, assuming that such a suit as this, involving no liability enforceable in rem against any ship of the United States, can be maintained at all, I find nothing in the later decisions which even suggests that such a suit can be brought in any district other than that of the plaintiff's residence or place of business. Judge Hand held that the presence of the Elmac could not support the jurisdiction, because she is not chargeable with any liability; the statute permitting suit to be brought in the district in which the vessel charged with liability is found.

The plaintiff having no residence or place of business in this district, the libel must aocordingly be dismissed.

Patents 114.

Plaintiff, in suit under Rev. St. § 4915, to compel issuance to him of patent for invertion embodied in patent issued to defendant, held not to have established inoperativeness of defendant's apparatus or lack of patentable novelty therein (Comp. St. § 9460).

In Equity. Suit by Herman W. Melling against the Gordon Form Lathe Company. Bill dismissed.

Chappell & Earl, of Kalamazoo, Mich., and Hull, Brock & West, of Cleveland, Ohio, for plaintiff.

Richey & Watts, of Cleveland, Ohio, and Bottum, Hudnall, Lecher & McNamara, of Milwaukee, Wis., for defendant.

WESTENHAVER, District Judge. This is an action under section 4915, R. S. (Comp. St. § 9460), to compel the issue of a patent to plaintiff. The invention in controversy is embodied in patent 1,542,803, issued June 16, 1925, to the defendant, as assignee of the inventors and applicants, Charles Gordon and Alfred W. Redlin. The subject of the invention is certain improvements in forming lathes, designed and intended for the forming and turning of irregular or nongeometrical forms, particularly cam shafts of automobile engines.

The Gordon & Redlin application, on which defendant's patent issued, was filed July 19, 1920. Melling's application was filed October 13, 1920. An interference between those copending applications was declared, and three counts were formulated by the Primary Examiner to cover the common subjectmatter of the two applications. Of these counts, the first, now claim 29 of said patent, was suggested by the Primary Examiner, and the second, now claim 2, and the third, now claim 28, of said patent, were adopted from the Gordon & Redlin application. After a prolonged controversy, including an appeal to the District of Columbia Court of Appeals, it was held and determined that Gordon and Redlin were prior inventors of the common subject-matter as embodied in said three counts, and the patent in question was passed to issue. See Melling v. Gordon, 55 App. D. C. 278, 4 F.(2d) 945.

The record in this cause, as well as in the Patent Office, is exceedingly voluminous. The contending parties were at all times represented by competent counsel. The contro

437

versy here, as well as in the Patent Office, was conducted with the utmost vigor, skill, and industry. Able and elaborate briefs covering all aspects of the controversy have been submitted. My best consideration has been given to all the questions of law and fact necessary to be considered and decided; but I shall, in this memorandum, state only my conclusions.

The record here is not distinguishable in any material respect from the record in the Patent Office. There is no question of priority of invention in the usual acceptation of that term. Gordon and Redlin had made had constructed and put in operation a lathe their invention, reduced it to practice, and embodying that invention, prior to Melling's

first consideration of the subject. It is conceded that Melling began work after having first seen and examined a Gordon & Redlin turning lathe. In substance, plaintiff's contentions are that the Gordon & Redlin apparatus, as described in their specifications and illustrated in their drawings, is not an operative machine; that they were not entitled, on the basis of these disclosures, or of the apparatus constructed in conformity thereto, to make or have the claims embodied in the interference counts, for the reason that the patentable subject-matter thereof is disclosed only in Melling's application, and not by Gordon and Redlin; and, in the alternative, that, if the counts in interference are to be given a construction broad enough to read upon Gordon and Redlin, then all such counts were fully disclosed in the prior art, and are devoid of patentable novelty.

Melling moved to dissolve the interference upon these grounds, and all of the contentions now urged in support thereof were urged in the Patent Office and on appeal, and were fully considered by one or the other of the several officials or tribunals. All of these contentions, upon a record substantially the same as the present record, were ruled adversely to the plaintiff by the Primary Examiner, the Law Examiner, and the Examiner of Interferences, and also, except as to the contention of patentable novelty, by the Board of Examiners in Chief, the Commissioner of Patents, and the Court of Appeals of the District of Columbia. It is true, the Primary Examiner and the Law Examiner, when these rulings were made as to patentability, did not have before them all of the prior art patents now cited and relied on; but they did have before them, and fully considered, Montreuil, 701,217, Fellows, 499,977, and Walter, 578,088. The other patents now relied on-i. e., Brophy, 649,905, Ruston,

494,684, Diehl et al., 607,987, and Teal et al., 10,496—were, however, cited and made a part of the record before appeal to the Commissioner of Patents. A separate petition was also presented to the Commissioner of Patents to exercise his revisory power to review the action of the subordinate officials for refusing to dissolve the interference on the ground of lack of patentable novelty.

It was within the province of the Examiner of Interferences and the Board of Examiners in Chief, and of the Commissioner of Patents, to have re-examined the issue of patentability, as well as the other issues determined adversely to the plaintiff. If Hill v. Wooster, 132 U. S. 693, 10 S. Ct. 228, 33 L. Ed. 502, has the force and effect now contended, it was their duty to have done so. If, upon the record, including the prior art cited and relied on, patentable novelty was lacking in the counts in interference, construed broadly, no reason is perceived why these officials would have permitted an invalid patent to issue. The Court of Appeals of the District of Columbia, in disposing of said appeal, said, it is true, in their opinion, that they will not consider the question of patentability in the light of the prior art, because an inquiry of that nature is not open for their consideration on an appeal in an interference proceeding. No reason is perceived why this question is not as much open to them as it is to this court, if the principles of Hill v. Wooster are to be given the extensive application now asserted. Be that as it may, Montreuil is the citation most strongly urged and relied on. It is, in my opinion, the most pertinent of all the prior art, and, if patentable novelty is lacking in the counts in issue, construed broadly, as was done by the Patent Office officials, then novelty is not negatived by any of the other citations.

An examination of the Patent Office record persuades me that all of the considerations urged and relied upon were considered and ruled adversely. I cannot agree with counsel's contention that any of substantial merit were overlooked or ignored. The reasoning of the several opinions as to the several questions treated therein appears to me to be sound. Plaintiff is therefore in effect asking this court to overrule all the officials and tribunals who have had these questions

under consideration, without presenting any substantially new or different evidence. Indeed, I regard the present record as more favorable to Gordon and Redlin than was the record considered by them. The additional evidence now presented clearly establishes not only the operative character of Gordon & Redlin's apparatus, so much debated in the Patent Office, but fully establishes its commercial practicability and acceptance in industry. No good reason is perceived to differ from the conclusions heretofore reached.

Likewise as to the contention of lack of patentable novelty in view of the prior art. At one stage or another, all of the pertinent prior art was brought forward, and the counts in issue were held patentable over the same. That art has again been considered by me. In my opinion, it does not deprive these counts of patentable novelty, even broadly construed, as was done by the Patent Office officials and tribunals. Even applying the principles of Hill v. Wooster, 132 U. S. 693, 10 S. Ct. 228, 33 L. Ed. 502, it does not appear to me that the interference should have been dissolved for want of patentable novelty.

The prior art will not be reviewed by me. In the first place, no useful purpose would be subserved by so doing, for I am not vain enough to believe that any counsel in the case will yield any view now held or expressed out of deference to any views that I might express. In the second place, I do not wish to go on record as holding that Hill v. Wooster justifies so broadening the issues in a suit under section 4915, R. S., as to make such a suit the practical equivalent of an infringement suit, in which all the defenses known to the patent law may be brought forward. In the third place, I am advised that an action is now pending, brought by defendant, charging infringement of patent 1,542,803 by the use of a Melling apparatus; and I deem it unwise to embarrass either party in the prosecution or defense of that action by expressions of opinion with respect to matters which can be more properly determined therein. It is in that action, rather than in this, that the proper scope of the three claims in question should be determined, as well as all questions of infringement.

For the foregoing reasons, plaintiff's bill will be dismissed, at his costs.

affitto 7 Ed. 237,

SEABOARD AIR LINE RY. CO. et al. v. LEE

et al.

ing, however, the scope thereof was broadened, by mutual consent, so as to include an in

An importer of nitrate of soda, bought in Chile and brought from there in chartered ships, received delivery at Wilmington, N. C., which was his place of business. On arrival the nitrate was stored or delivered from the dock to purchasers to whom quantities had been resold; all contracts of resale providing for delivery at Wilmington. Purchasers, either from store or dock, reshipped by rail on new billing to various manufacturers of fertilizer or dealers to points both within and without the state. Held, that such reshipments were not in continuance of the foreign shipment, not being within the intention of the importer, whose purpose was fully subserved on delivery to him at Wilmington, but were new and independent movements, with which the importer had no concern, and that where such a reshipment was to a point within the state it was an intrastate shipment, and

subject to established local rates.

In Equity. Suit by the Seaboard Air Line Railway Company and the Atlantic. Coast Line Railroad Company against William T. Lee and others, as members of the Corporation Commission of the state of North Carolina, and others. On motion for preliminary injunction. Motion denied.

This is a suit in equity, brought by the complainants to enjoin the enforcement of an order of the North Carolina Corporation Commission, the material portion of which is as follows:

"Ordered, that the Atlantic Coast Line Railroad Company, and the Seaboard Air Line Railway Company, issue within ten days from this date instructions to their agents at Wilmington to apply the intrastate rates on shipments from Wilmington to destinations in this state upon all shipments having origin as rail shipments at Wilmington and in good faith, by or upon order of, or to order notify of, parties other than the original consignees of such traffic at Wilmington, that contrary instructions now in effect be canceled within ten days, and that copy of such instructions be filed with the Corporation Commission within ten days."

This order was entered by the commission on April 22, 1924, after a hearing held on February 26th of same year, pursuant to notice to the complainants, relating solely to the rates applied to movements of fertilizer materials from the port of Wilmington, N. C., to interior points in the state. At the hear

of all commodities imported into Wilmington -the testimony agreeing that the manner of dealing in all such commodities was, in all respects, the same. This common manner of dealing may be illustrated, therefore, by describing the method employed by Grace & Co., with reference to nitrate of soda, one of the most important substances involved.

Nitrate of soda is imported from Chile in large quantities annually. The shipping season begins in December and ends in May or June. The nitrate is purchased in Chile, and transported in vessels chartered for this purpose to various ports of entry in the United States, notably New York, Baltimore, Newport News, Wilmington, Charleston, and New Orleans. When a vessel leaves Chile, it is not known at which of these ports it will discharge its cargo. This is not determined until the vessel reaches the Panama Canal, where definite directions as to the port of entry are given, and is dependent upon demands of the trade and the importer's supply of stock at the various ports.

The importer sells to the manufacturer and the retailer, and the practice in making sales varies. In some instances the purchase is made direct from the importer, while in others it is made through a sales agent of the importer, or through a broker. The contracts of sale call uniformly for delivery at Wilmington, usually ex vessel or ex store, though in some instances f. o. b. the dock, and invariably provide, "No arrival, no sale." Some of these contracts are made in advance of the shipping season, some while the nitrate is in transit, and some after its arrival at Wilmington, where the importer, under a standing arrangement with the Wilmington Compress Company to use its warehouse for this purpose, maintains constantly during the shipping season a supply stock.

Nitrate is shipped in bags or in bulk, and in some instances partly in both. When the vessel arrives at Wilmington, the cargo is discharged by a stevedore, at the expense of the vessel, upon the docks of the Wilmington Compress Company, with whom the importer has also a continuing agreement to use its docks for this purpose. Where the charter party so requires, the cargo is also weighed at the vessel's expense. After its discharge from the vessel, it is delivered to the importer upon the dock, who, through his agents, Heide & Co., proceeds to brand and tag the nitrate, in accordance with the inspection laws of the state, and, in those instances