the transactions in question took place, and when the decision of the circuit court was rendered, not only was there no settled construction of the statute on the point under consideration, but the Missouri cases referred to arose upon the identical transactions which the circuit court was called upon and which we are now called upon to consider. It can hardly be contended that the Federal Court was to wait for the State Courts to decide the merits of the controversy and then simply register their decision; or that the judgment of the circuit court should be reversed merely because the State Court has since adopted a different view. If we could see fair and reasonable ground to acquiesce in that view, we should gladly do so, but in the exercise of that independent judgment, which it is our duty to apply to the case, we are forced to a different conclusion. The cases of Pease v. Peck, 18 How., 598 [59 U. S., XV., 520], and Morgan v. Curtenius, 20 How.,1 [61 U.S., XV., 823], in which the opinions of the court were delivered by Mr. Justice Grier, are precisely in point.

The cardinal position assumed by the State Court is, that, inasmuch as certificates of stock were in fact issued to and accepted by J. and W. Seligman, and they voted on the stock, they are absolutely estopped from denying that they are the owners of the stock, subject to all the liabilities incident to that relation; and that they cannot have the benefit of the exception accorded by the law to those who hold stock as collateral security, because, as the court holds, that exemption only applies to those who have received stock in that way from some stockholder who can be made liable as a stockholder, and not to those who have received stock from the corporation itself by way of collateral security.

The first position, that the acceptance of the stock and voting upon it, absolutely precluded the defendants from denying that they are owners of the stock, has been already considered. The great mass of authorities relied on by the Supreme Court of Missouri, on this part of the case, English as well as American, are cases in which parties have been held as corporators or associates as between themselves and the corporation, and upon that footing have been held responsible to creditors when the rights of creditors have been in question. We think that we have sufficiently shown that these authorities cannot govern the case in hand, if any effect is to be given to the law of Missouri exempting from personal liability those who hold stock in a fiduciary character or by way of collateral security. We will, therefore, briefly examine the other position, that this law does not apply to those who receive stock as collateral security from the corporation itself.

The argument that the exemption from liability in cases of stock held as collateral security, applies only to those who have received it from third persons who were stockholders and who can be proceeded against as such, seems to us unsound and contrary both to the words and the reason of the law. It takes for granted that stock cannot be received as collateral security from the corporation itself and still belong to the corporation, and yet we know that such transactions are very common in the business of this country. The words of the statute are positive and relate to all holders of stock for col

lateral security. They are as follows: "No person holding stock in any such company as executor, administrator, guardian or trustee, and no person holding such stock as collateral security, shall be personally subject to any liability as stockholder of such company." The reason of this law is derived from the gross injustice of making a person liable as the owner of stock when he only holds it in trust or by way of security, and from the inexpediency of putting a clog upon this species of property, which will have the effect of making it unavailable to the owner, or of deterring prudent and responsible men from accepting positions of trust where any such property is concerned. It seems to us that not only the law but the reason upon which it is founded applies to the holders of stock as collateral security, whether received from an individual or from the corporation itself. It is argued, however, that the remaining words of the law are repugnant to this view. These words are as follows: "But the person pledging such stock shall be considered as holding the same, and shall be liable as a stockholder accordingly; and the estates and funds in the hands of such executor, administrator, guardian or trustee shall be liable, in like manner and to the same extent, as the testator or intestate, or the ward or person interested in such fund, would have been if he had been living and competent to act, and held the stock in his own name." The argument is, that these words imply that there must always be some person or estate to respond for the stock, or else the exemption cannot take effect. The obvious answer is, that this clause fixes the liability upon the pledger as a stockholder, where there is a pledger who can be made liable in that character. When the corporation pledges its own stock as collateral security, though it cannot be proceeded against as a stockholder eo nomine, the reason is because it is primarily liable, before all stockholders, for all its debts. In such a case the clause last quoted would not strictly apply to it; but the holder of its stock as collateral security would be within both the letter and the spirit of the first clause. It is supposed that some flagrant injustice would ensue if there was not some one who could be reached as a stockholder in every case of stock pledged as collateral security; hence, stock pledged by the corporation itself must be regarded as belonging to the pledgee, though no other pledgee of stock is treated in this way. Where is the justice of this? Why should the stock be necessarily considered as belonging to some one besides the corporation itself? Is anyone harmed by considering the corporation as its true owner? If the stock had not been issued as collateral security, it would not have been issued at all; it would not have been in existence. Would the creditors have been any better off in such case? They are better off by the issue of the stock as collateral, because the general assets of the company have received the benefit of the moneys obtained by means of the pledge. The more closely the matter is examined, the more unreasonable it seems to deny to a pledgee of the corporation the same exemption which is extended to the pledgee of third persons. We think that the one equally with the other is protected by the express words and true spirit of the law.

We might pursue the subject further, and

examine in detail the suggestions and authorities adduced by the learned court which decided the cases of Griswold v. Seligman [72 Mo., 110] and Fisher v. Seligman [75 Mo., 13], but it is unnecessary. What we have said is sufficient to indicate substantially the grounds on which we feel obliged to dissent from its conclusions. In our judgment, the facts found by the court below make out a clear case of stock held in trust and by vay of collateral security only, and the judgment rendered thereon was correct. Judgment affirmed. True copy. Test:

James H. McKenney, Clerk, Sup. Court, U. S. Cited-107 U. S., 541; 109 U. S., 126, 257, 379; 111 U. S., 563; 114 U. S., 353.

JOSEPH L. HALL, Appt.,

v.

Mr. Justice Blatchford delivered the opinion of the court:

This suit is brought on letters patent No. 67046, granted to Joseph L. Hall, the appellant, July 23, 1867, for an improvement in connecting doors and casings of safes. The only claim alleged to have been infringed is claim 3, which is in these words: "3. The conical or tapering arbors 1, in combination with two or more plates of metal, in the doors and casings of safes and other secure receptacles, the arbors being sesubstantial manner." cured in place in the plates by keys, 2, or in other In regard to what is embraced in this claim the specification says: "The nature of this invention consists in * * curing a series of plates forming a casing or door of the safe by means of conical or tapering arbors, which, being tapped in from the outside of the door or casing and keyed upon the inside, present serious obstacles to the removal of successive plates forming the body of the safe. Fig

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se

(See S. C., 17 Otto, 90-97.)

Letters patent—construction of—prior public use.

1. Whether claim 3 of letters patent No. 67046, granted to Joseph L. Hall, July 23, 1867, for an "improvement in connecting doors and casings of safes," namely: "3. The conical or tapering arbors 1, in combination with two or more plates of metal, in the doors and casings of safes and other secure re ceptacles, the arbors being secured in place in the plates by keys, 2, or in other substantial manner,' claims arbors which are tapped into two or more plates; or whether it excludes, as a part of it, screw threads cut on the arbors, is immaterial in the present case, because, under the former view, the defendants are not shown to have used arbors with screw threads on any part of the arbor that is within the plates; and, under the latter view, the claim is invalid. 2. The whole invention existed in letters patent granted to said Hall, September 25, 1860, for an "improvement in locks."

3. A cored conical bolt with a screw thread on it having been shown in the patent of 1860, and a solid conical bolt having existed, there was no invention in adding the screw thread to the latter bolt.

4. Solid conical bolts without screw threads having been used in two safes made and sold by the inventor more than two years before his patent was applied for, the invention covered by said claim 3 was in pubHe use and on sale, with the consent and allowance of the inventor, so as to make such claim invalid under sections 7 and 15 of the Act of July 4, 1836, 5 Stat. at L., 117, and section 7 of the Act of March 3, 1839, 5 Stat. at L., 353.

5. Such use was not a use for experiment. [No. 163.] Argued Jan. 25, 26, 1883. Decided Feb. 5, 1883.

APPEAL from the Circuit Court of the United States for the Southern District of Ohio. The bill in this case was filed in the court below, by the appellant, to recover damages, alleged to have been sustained through the infringement of certain letters patent, and for an injunction.

The court below having entered a decree dismissing the bill, the complainant appealed to

this court.

The facts of the case are fully stated by the

court.

Messrs. Edward N. Dickerson, Thomas A. Logan and William C. Cochran, for appellant.

Mr. James Moore, for appellees.

*Head notes by Mr. Justice BLATCHFORD.

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bodying my invention. Figure 2 is a horizontal section of part of the same. Figure 3 is a detail view, in cross section, of the door of the safe, showing the shape of, and manner of securing, an arbor. The most approved manner of securing together the numerous plates forming the casings and doors of safes is by means of screws tapped in from one series of pairs or triplets of plates from the inside, presenting no rivet heads upon the outside surface of the safes. * In the doors of safes, the outer plate D is secured to the plates E F by screws b, countersunk in the plate F. The fourth plate, I, has about the same area as the plate E. It is secured to the plate F by screws e, which pass through the inner plate K, in which they are countersunk. * * * In order to still further secure together the plates forming the door of the safe, I use a conical arbor, 1, or a number, if necessary; they are introduced in openings through the series of plates, being tapped into the two innermost of all the plates, and keyed in position. A smooth surface in the plane of the outer face of the door is presented, giving no means of removing the arbors 1, even should the key, 2, be removed. *** Since the doors of safes are more exposed than any other part of them, it is necessary to embody in their construction such devices, which in themselves are the simplest, as shall effectually bar forcible entrance to the safes. The introduction of arbors for the purpose of more effectually binding in one compact mass the series of alternate iron and steel plates

in the doors or bodies of safes will very much protract the labors of the burglar; indeed, it will succession, to cut out the arbors, which are made be necessary, in order to remove one sheet in of the hardest steel. The arbors may be tapped end rivet headed instead of keyed, as shown in through the entire series of plates, and the inner the drawing or the inner plate, as well as other sections and, fitting into notches in the arbor or in the series of plates, may be put together in arbors, secure them in position. In this latter construction, the arbors need not be conical but may have any cross section, tapering longitudinally."

When the specification says that the conical arbors are 66 tapped in from the outside," it means that screw threads are cut on them and take into screw threads in the body, and that the

arbors are screwed in and have their smaller end towards the inside. The drawing, figure 3, shows this, there being five plates, and the arbor being in position, and tapering from the outside to the inside, the larger end being towards the outside, and a screw thread being cut on the arbor for the distance of the thickness of the two innermost plates, and the arbor extending through the five plates, from the outer surface of all to the inner surface of all, and a key extending from the inside, lengthwise of the arbor, the distance of the length of the screw thread. The arbors, the specification says, May be tapped through the entire series of plates," that is, the entire length of the arbor may have a screw thread cut on it, and the inner end may be rivet headed, that is, headed down into a rivet instead of being keyed. A peculiarity of the conical arbors is stated in the specification to be that they are tapped in from the outside and keyed upon the inside, in contradistinction to the then existing most approved method of having screws with conical heads, the heads being countersunk in one of the plates, and the cone shape of the heads holding the screws so as to make it unnecessary to rivet them on the outside of the safe, the screws not going through all the plates, the head of the screw being towards the inside of the safe and the other end of it not projecting beyond the outside. Whether claim 3, in claiming "the conical or tapering arbors 1 in combination," etc., is to be held, in view of the description in the text of the specification and of the drawing, figure 3, to necessarily claim arbors which are tapped into two or more plates, or whether that claim excludes, as a part of it, screw threads cut on the arbors, is not material to this case. If the former, the appellees are not shown to have used arbors with screw threads on any part of the arbor that is within the plates. If the latter, then, infringement being shown, we are satisfied that claim 3 cannot be sustained. The contention of the appellant is, that the invention covered by that claim requires only a conical hole, conical through the entire series of plates to be secured, and a conical bolt corresponding thereto and secured in place in the plates by a key, or in any other substan- | tial manner.

A patent was issued to the appellant September 25, 1860, for an improvement in locks. The specification of that patent says: "Resting upon the front plate B of the lock, as shown in figure 4, are seen two conical blocks, I I', a plan of which is represented in figure 11. These are precisely alike in their construction, and they are adapted to the two stems G and H, as will appear. They are of a length corresponding with the thickness of the door M, to which the lock is applied, so that, when introduced into appropriate apertures in the door, their outer faces will be flush with the outer face of the door, and their inner faces flush with the inner face of the door, and against the front face of the lock, when the same is properly fixed upon the door. The blocks I I' enter their apertures in the door by a screw thread, and they are held from turning therein, so as to return outwardly, by an ordinary key driven into a key seat drilled from the inside of the door before the lock is applied to its place. * * * The conical blocks are cored or drilled out in a peculiar manner to receive the two-part revolving

arbor, as shown, the part p (p), entering the narrow end of the conical blocks, being of a cylindrical form, and the part q (q), entering the large end of the conical blocks, being of å conical form." These revolving arbors turn the stems G and H, and thus the tumblers are adjusted and the bolt of the lock is thrown. The drawing of the patent shows that the conical blocks II' as passing entirely through the door, the larger end of the cone on the outside, and each end flush with its proper face. These conical blocks were screw threaded on their surface in the door, and were keyed from the inside. They were cored to admit the revolv ing arbors, but their bodies operated in all respects like the conical arbors of the patent sued on.

In 1868 John Farrell and Jacob Weimar applied for a patent for the same thing covered by claim 3 of the patent sued on, and the Patent Office declared an interference between their application and that patent. The appellant was examined as a witness on his own be half, in October, 1868, in that interference, and testified as follows: "3d Int. State what knowl edge you have had, in manufacturing safes, of the use of a series of plates united by conical bolts, made drill proof, and when and where you first had knowledge of their use. Ans. The first was in the year 1858 or 1859. I came across one John P. Lord's lock, which was said to be a combination, no-key-hole bank lock. I negotiated with the parties representing it, to try and introduce it and manufacture it. I then began to examine into it more particularly, and found that the knob or dial projecting through the door seemed to be very insecure in its construction. I set myself about so as to invent some better way of securing the protection to the lock and also the plates of the doors. I then invented a double and single conical shaped arbor or plug, made drill proof, composed of wrought iron and steel welded together, the design of which was to fully protect the lock against sledge hammers or other tools for driv ing the plug or plugs in, or from being drilled into, they being hardened. The further design of the said drill proof plugs or arbors was to secure together a series of plates of wrought iron and steel or other suitable metal whereby they could not be separated or pulled apart, more firmly binding them together than had been our former method of making safes, or joining together such series of plates. Some time after, during the year 1859 or 1860, the exact period of time I cannot remember fully, we made burglar proof safes, of a series of plates composed of iron and steel joined together, in which we had used more of the conical, drill proof bolts or arbors than we had formerly been in the habit of doing, for the express purpose of more securely fastening the plates together. We made them in the City of Cincinnati, in our factory, which was situated about the middle of the square bounded by Columbia, Sycamore, Front and Main Streets. We have also used them to a very considerable extent since that time, in our factory situated at the south west corner of Plum and Pearl Streets. I secured a patent for my double, conical, drill proof arbor in the year 1860. My design of that was to secure full protection to combination no-key-hole bank locks. My single arbor I don't think I

made any claim on at that time, but used it for the express purpose of binding the series of plates together. This was also a conical, drill proof bolt, made of iron and steel. Our modes of fastening the above described arbors were in different ways. Some we made conical, at the smaller end were made soft, so that we could rivet them down into a countersunk plate; others we cut a thread upon at the small end of the arbor or drill proof bolt, which was done, and, when fitted up, the conical shaped arbor or bolt was tempered; others were made with a thread cut upon the end of them, designed for a nut, which was designed to be used on the smaller end of them to fasten them more securely, so that they could not be withdrawn from the outside. The conical shaped arbor, with the thread cut upon the arbor, was designed to be screwed into the inner plate of a series of plates, and then a key seat cut in each of the threads of the plate and of the arbor, so that keys could be driven in to prevent their being unscrewed and withdrawn from the ouside, thereby making them secure against the drill or the use of the sledge hammer or other tools for forcing them in, being of a conical shape, or from removing any of the series of plates through which they passed."

It is apparent from this testimony, that the appellant regarded the double, conical shaped arbor or plug, that is, the cored conical block, and the single, conical shaped arbor or plug, as being the same invention. He was endeavoring to carry back to 1858 or 1859 the invention covered by claim 3 of his patent of 1867. The only difference he makes between the double and the single arbor is that the former had a core removed from it. The latter was solid. Both, he says, were drill proof, and had the same further design or object, namely: to secure together a series of plates in safes. He also says, that in 1859 or 1860, he made burglar proof safes of a series of plates composed of iron and steel joined together, using in them these single conical bolts or arbors, for the express purpose of more securely fastening the plates together. He then describes the cutting of a thread upon the arbor and one of the plates to screw the arbor into the inner plate, and cutting a key seat in the two threads, and putting in a key to prevent the arbor from being unscrewed from the outside. All this describes exactly what is covered by claim 3 of the patent sued on. In his testimony in the present suit, the appellant states that he made three safes between 1359 and 1864 which were burglar proof, and had conical bolts for fastening together the different plates of metal. One of them had the double conical bolt and no single bolt, and was sold to a firm in Dayton, Ohio. One was made in 1858 or 1859, to be exhibited at a fair in Ohio, and was sold to a banker in Lafayette, Indiana. It had the single, drill proof conical arbors in the doors. The third one was made to be exhibited at a fair held in 1860, and was sold to the treasurer of Loraine County, Ohio. It had a few of the single conical arbors. It does not distinctly appear that the single conical bolts in the Lafayette and Loraine County safes had screw threads cut on them, but the appellant testifies in this case that the double arbor of his patent of 1860 had a screw thread

cut upon it running through one or more of the inner plates, for the purpose of holding it. It clearly appears, from the testimony of the appellant himself, that the idea of making a claim to the invention covered by claim 3 of the patent sued on arose from the introduction into safes, in 1866 or early in 1867, of plates of steel and iron welded together. This enabled the value of the screw threaded conical bolt to be more fully developed, because the screw thread could be made more effective the whole length of the bolt. But the whole invention existed in the bolt of the patent of 1860. There was no invention in adding to the solid conical bolt the screw thread of the cored conical bolt.

Moreover, the use and sale of the solid conical bolts in the Lafayette and Loraine County safes, even though those bolts had no screw threads on them, constituted a use and sale of the invention covered by claim 3 of the patent in suit. The application for that patent was made in March, 1867, and the patent was granted under the provisions of the Act of July 4, 1836, 5 Stat. at L., 117, and of the Act of March 3, 1839, 5 Stat. at L., 353. Within the meaning of sections 7 and 15 of the Act of 1836, as modified by section 7 of the Act of 1839, the invention covered by claim 3 of the patent in suit was in use and on sale more than two years before the appellant applied for that patent, and such use and sale were, also, with the consent and allowance of the appellant, and the use was a public use. It is contended that the safes were experimental and that the use was a use for experiment. But we are of opinion that this was not so and that the case falls within the principle laid down by this court in Coffin v. Ogden, 18 Wall., 120 [85 U. S., XXI., 821]. The invention was complete in those safes. It was capable of producing the results sought to be accomplished, though not as thoroughly as with the use of welded steel and iron plates. The construction and arrangement and purpose and mode of operation and use of the bolts in the safes were necessarily known to the workmen who put them in. They were, it is true, hidden from view, after the safes were completed, and it required a destruction of the safe to bring them into view. But this was no concealment of them or use of them in secret. They had no more concealment than was inseparable from any legitimate use of them. As to the use being experimental, it is not shown that any attempt was made to see if the plates of the safes could be stripped off, and thus to prove whether or not the conical bolts were efficient. The safes were sold and, apparently, no experiment and no experimental use were thought to be necessary. The idea of a use for experiment was an afterthought. An invention of the kind might be in use and no burglarious attempt be ever made to enter the safe, and it might be said that the use of the invention was always experimental until the burglarious attempt should be made, and so the use would never be other than experimental. But it is apparent that there was no experimental use in this case, either intended or actual. The foregoing views, which are controlling to show that claim 3 of the patent in suit cannot be sustained, are in accordance with those announced by this court in Eg. bert v. Lippmann, 104 U. S., 333 [XXVI., 735).