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21 F.(2d) 4

made to appear which would give the Commission jurisdiction to make a corrective order. It follows that complainant is not entitled to maintain this proceeding and his petition should therefore be dismissed."

We think it clear that, if the Northern Pacific through its power and domination imposed an unfair and unjust division on the Minnesota Company and one that did not provide reasonable compensation out of the joint rates to the Minnesota Company, such action constituted a violation of the Act to Regulate Commerce under the decision in the Morgantown & Kingwood Divisions Case.

The provisions of section 1, as amended, of the Act to Regulate Commerce, quoted above, were substantially re-enacted by the provisions of paragraph 4 of section 400 of the Transportation Act of 1920. Section 8563 (4), 1923 Supp. U. S. Comp. St.

Section 13 of the Act of February 4, 1887, as amended (section 8581, U. S. Comp. St. 1916), reads as follows:

"Any person, firm, corporation, company, or association, ⚫

or any common carrier, complaining of anything done or omitted to be done by any common carrier subject to the provisions of this act, in contravention of the provisions thereof, may apply to said Commission by petition, which shall briefly state the facts; whereupon a statement of the complaint thus made shall be forwarded by the Commission to such common carrier, who shall be called upon to satisfy the complaint, or to answer the same in writing, within a reasonable time, to be specified by the Commission. If such common carrier within the time specified shall make reparation for the injury alleged to have been done, the common carrier shall be relieved of liability to the complainant only for the particular violation of law thus complained of. If such carrier or carriers shall not satisfy the complaint within the time specified, or there shall appear to be any reasonable ground for investigating said complaint, it shall be the duty of the Commission to investigate the matters complained of in such manner and by such means as it shall deem proper.

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No complaint shall at any time be dismissed because of the absence of direct damage to the complainant."

This section was re-enacted by the Transportation Act of 1920 (section 8581, U. S. Comp. St. 1923 Supp.).

In the case of Interstate Commerce Commission v. Baird, 194 U. S. 25, 39, 24 S. Ct. 563, 567 (48 L. Ed. 860), the court said:

"It is urged that the complainant before

the Commission did not show any real interest in the case brought, and that the proceeding should for that reason have been dismissed. It is provided in the Act to Regulate Commerce, § 13, that 'any person, firm, corporation,' etc., complaining of anything done or omitted to be done by any common carrier subject to the provisions of this act in contravention of the provisions thereof may apply to said Commission by petition, etc. And certain procedure is provided for-and [said Commission] 'may institute any inquiry on its own motion in the same manner and to the same effect as though complaint had been made,' and the section concludes: 'No complaint shall at any time be dismissed because of the absence of direct damage to the complainant.' In face of this mandatory requirement that the complaint shall not be dismissed because of the want of direct damage to the complainant, no alternative is left the Commission but to investigate the complaint, if it presents matter within the purview of the act and the powers granted to the Commis

sion."

See, also, Interstate Commerce Commission v. Detroit, G. H. & M. Ry. Co. (C. C.) 57 F. 1005, 1008, 1009; Id. (C. C. A.) 74 F. 803, 807; U. S. v. New York Central R. R., 272 U. S. 457, 47 S. Ct. 130, 71 L. Ed. —; U. S. v. U. S. v. Sumpter Valley Ry. Co., 53 I. C. C. 607; U. S. v. Union Pacific Ry. Co., 28 I. C. C. 518.

We think the broad language employed in section 13 fully authorizes the complainant as a minority stockholder to file a com plaint with the Interstate Commerce Commission charging an unjust, unreasonable, and inequitable division of joint rates between the Minnesota Company and the other carriers involved, and that such a complaint so filed would properly invoke the jurisdiction of the Commission, and that upon such a complaint it would proceed to investigate the complaint and report in writing its conclusions, together with its decision, order or requirement in the premises.

II. Divisions of Intrastate Rates. [13, 14] It is well settled that the powers of a state Commission are special and limited, and they can exercise only such authority as is legally conferred by express provisions of law, or such as is by fair implication and intendment incident to and included in the authority expressly conferred for the purpose of carrying out and accomplishing the objects for which the Commission was created, and that any reasonable doubt of the existence of any particular power in the Commis

sion should be resolved against the exercise of such power. State ex rel. Railroad Com'rs v. Louisville & N. R. Co., 57 Fla. 526, 49 So. 39; Siler v. Louisville & Nashville R. R. Co., 213 U. S. 175, 194, 29 S. Ct. 451, 53 L. Ed. 753; Board of R. Commissioners of Oregon v. Oregon Ry. & Nav. Co., 17 Or. 65, 19 P. 702; 10 C. J. p. 54, § 41. We have seen that the fixing of divisions for the future is a legislative function. Terminal R. R. Ass'n v. U. S., supra; Great Northern Ry. v. Merchants' Elevator Co., supra. This legislative power to fix divisions may be lawfully delegated to a state Commission. Grand Trunk Ry. Co. v. Michigan R. R. Commission, 231 U. S. 457, 34 S. Ct. 152, 58 L. Ed. 310; Louisville & Nashville R. R. Co. v. Garrett, 231 U. S. 298, 34 S. Ct. 48, 58 L. Ed. 229; Railroad Commission Cases, 116 U. S. 307, 6 S. Ct. 334, 388, 1191, 29 L. Ed. 636; Minneapolis & St. Louis R. R. Co. v. Minnesota, 186 U. S. 257, 22 S. Ct. 900, 46 L. Ed. 1151, 10 C. J. p. 54, § 39.

In Railroad Co. v. Minnesota, supra, the

court said:

"The argument for the railroad companies in this case assumes that, while the state may interfere as between the railways and their customers, the shippers of freight, it cannot do so as between the railways themselves, by fixing joint tariffs and apportioning such tariffs among the several railways interested in the transportation. • Granting that a state has no right to interfere with the internal economy of a railroad farther than to secure the safety and comfort of passengers, as, for example, to fix the wages of employés or control its contracts for construction, or the purchase of supplies, it has a clear right to pass upon the reasonableness of contracts in which the public is interested, whether such contracts be made directly with the patrons of the road, or for a joint action in the transportation of persons or property in which the public is indirectly concerned." [15] We must therefore look to the statutes of Minnesota to determine whether the Legislature authorized the Railroad and Warehouse Commission of Minnesota to fix divisions of joint intrastate rates.

The applicable provisions of the Minnesota statutes are found in sections 4638, 4639, 4640, 4641, 4644, and 4700, General Statutes Minn. 1923. These sections are set out in marginal note 1.

1“4638. Proceedings before Commission-How Commenced-Proceedings before the commission against any such carrier or public warehouseman shall be instituted by complaint, verified as a pleading in a civil action, stating in ordinary

It is clear that by section 4700 the Legislature intended to grant comprehensive powers to the Commission to fix and establish joint rates. But, neither this section nor, so far as we have been able to discover, any other section of the present statutes defining and fixing the powers of the Commission, expressly authorizes it to fix divisions. However, without the power to fix divisions the power to establish joint rates would be incomplete

language the facts constituting the alleged omission of offense. The parties to such proceeding shall be termed, respectively, ‘complainant' and 'respondent.'

"4639. Notice to Respondent-Upon filing such complaint, if there appear reasonable grounds shall issue an order directed to such carrier or for investigating such matter, the commission warehouseman, requiring him to grant the relief demanded, or show cause by answer within twenty days from the service of such notice why such relief should not be granted. Such order, together with a copy of the complaint, shall forthwith be served upon the respondent.

"4640. Answer-The respondent may file and serve by mail upon the complainant, within twenty days after service of the order, an answer alleging that it has already granted the relief demanded, or setting up any matter of defense. If the answer allege the granting of the relief, the complainant shall within twenty days reply, admitting or denying such allegation. If he fails to reply, or admits the allegation, the proceeding shall be dismissed.

"4641. Hearings before Railroad and Warehouse Commission-If the matter be not adjusted to the satisfaction of the commission, it shall set a time and place of hearing, and give at least ten days' notice thereof to each party. The parties may appear either in person or by attorney. The commission shall hear evidence make findings of fact upon all matters involved, and otherwise investigate the matter, and shall

and such order or recommendation in the premises as may be just. A copy of such findings and order or recommendation shall forthwith be served upon each party. No proceeding shall be dismissed on account of want of pecuniary interest in the complainant. * *

"4644. Complaint that Rate is UnreasonableDuty of Commission-Upon the verified complaint of any person or of any corporation, private or municipal, that any tariff of rates, fares or charges, or any part thereof, or of any classi fication is unequal or unreasonable, the commission shall proceed to investigate the matters alleged in such complaint.

"4700. Powers and Duties of CommissionNotice and Hearing-Schedule of Rates-Revising Rates The board of railroad and warehouse commission shall, within ten days after this act takes effect, notify in writing every railway company owning or operating a railway within this state that it will, upon a day named in such notice, which day shall not be more than thirty days after giving said notice, take up for investigation the subject of establishing joint through rates, as herein provided, between the railway lines in this state. It shall also give a similar notice, directed "To whom it may concern,' and so publish the same that it will have

21 F.(2d) 4

and ineffectual. The carriers by refusing to agree as to divisions could greatly delay if not defeat the effect of an order fixing a joint rate. The fixing of each carrier's share is really a part of the establishing of a joint rate. Until the division is fixed the rate for practical purposes is incomplete. We think, therefore, that section 4700 by necessary implication conferred power upon the Commission, not only to fix and establish joint rates but also to fix the divisions of such rates between the carriers. That such was the intent of the Legislature is evidenced by the provision "the share of any railroad company of any joint through rate shall not be construed to fix the charge that it may make for transportation for a similar distance over any part of its line for any single rate shipment." This language seems to assume that the Com

mission will fix divisions.

[16] It will be observed that section 4700 provides that the Commission upon the application of any person interested may revise, change, or add to, any joint through rates fixed or promulgated pursuant to such section. We think that under this provision the complainant could have lodged its complaint and upon a proper showing secured a revision of the joint intrastate rates and the divisions thereof between the Minnesota Company and the Northern Pacific.

general circulation throughout the state. All corporations, partnerships and persons interested in the subject may present themselves at the hearing and be heard, under such rules and regulations as the board may prescribe. At the end of the investigation, which shall be carried on with all due diligence, the said board of railroad and warehouse commission shall make and publish a schedule of joint through railway rates for such traffic and on such routes as in its judgment the fair and reasonable conduct of business requires shall be done by carriage over two or more lines of railway, and will promote the interests of the people of this state. In the making thereof, and in changing, revising or adding to the same, the board shall be governed as nearly as may be by the preceding sections of this chapter, and shall take into consideration, among other things, the rates established for shipments within this state for like distances over single lines, the rates charged by the railway compapies operating such connecting lines for joint interstate shipments, and the increased cost, if any, of a joint through shipment as compared with a shipment over a single line for like distances. In establishing such rates for shipments in less than carload lots, in cases where at the connecting point or points in the line of shipments the connecting railways have not and are not required to have a common station or stopping place for loading or unloading freight,

[17] The reasons which require preliminary resort to the Interstate Commerce Commission and a determination by it of what is a proper division of a joint interstate rate before judicial relief can be had on account of unjust, unreasonable and inequitable divisions in the past apply with equal force where the question of divisions of intrastate rates are involved, and it logically follows that before the complainant could secure judicial relief on account of past intrastate divisions, it was necessary for it to first apply to the Railroad and Warehouse Commission of the state of Minnesota, and have the preliminary question of what is a fair division of the rates involved first determined by that Commission.

We therefore conclude that the District

Court was without jurisdiction to fix divisions of joint rates between the Minnesota Company and the other carriers involved for the future, and because the preliminary question of what is a just, reasonable, and equitable division of joint interstate rates had not been determined by the Interstate Commerce Commission, and of joint intrastate rates had not been determined by the Minnesota Railroad and Warehouse Commission, it was also without jurisdiction to award damages on account of divisions of such joint rates in the past.

The decree appealed from is affirmed, with costs.

the board shall make such lawful regulations as in its judgment will be fair and just respecting the transportation of such freight from the usual unloading place of one railway to the usual loading place of the other. The joint through rates thus established shall be promulgated by mailing a printed copy thereof to each railway company affected thereby and shall go into effect within ten days after they are so promulgated; and from and after that time an official printed schedule thereof shall be prima facie evidence, in all courts of this state, that the rates therein fixed are just and reasonable for the joint transportation of such freight between the points and over the lines described therein. The said board shall deliver a printed copy of said schedule to any person making application therefor. The share of any railway company of any joint through rate shall not be construed to fix the charge that it may make for transportation for a similar distance over any part of its line for any single rate shipment or the share of any other joint rate. The board, upon such reasonable notice as it may prescribe, may, upon its own motion or upon the application of any person, firm or corporation interested therein, revise, change or add to any joint through rates fixed or promulgated hereunder; and any such revised, changed or added joint rates shall have the same force and effect as the rate or rates originally established.

M

Amasa C. Paul, of Minneapolis, Minn.,

ALLINSON MFG. CO. v. IDEAL FILTER and Bair & Freeman, of Des Moines, Iowa

CO.

Circuit Court of Appeals, Eighth Circuit. June 29, 1927.

No. 7603.

1. Patents 87-Abandonment of invention may be shown by things occurring before expiration of statutory period for making application for patent (35 USCA §§ 31, 69).

Abandonment of an invention may be shown by proof of things occurring before expiration of two-year period of public use within which application for patent must be made, under Rev. St. §§ 4886, 4920 (35 USCA §§ 31, 69; Comp. St. §§ 9430, 9466).

2. Patents 83-Abandonment of right to patent may arise from lapse of time, silence,

or inaction, without intent to relinquish inchoate rights to public.

Lapse of time, silence, and inaction in making application for patent monopoly may constitute abandonment, although there was no proof of express intent to relinquish inchoate rights to the public.

3. Patents

87-Evidence held to establish abandonment of right to patent for machine for cleaning gasoline (35 USCA §§ 31, 69; Const. art. 1, § 8).

Proof that patentee dismantled machine invented for cleaning gasoline used in dry-cleaning plant, and for several years engaged in other work, and did not apply for patent until his interest was revived by seeing another's machine, held sufficient to show abandonment of right to patent under Rev. St. 88 4886, 4920 (35 USCA §§ 31, 69; Comp. St. §§ 9430, 9466); Const. art. 1, § 8.

4. Patents 83-Public use need not continue for more than two years, to constitute "abandonment" of right to patent (35 USCA § 31,

69).

Under Rev. St. §§ 4886, 4920 (35 USCA §§ 31, 69; Comp. St. §§ 9430, 9466) public use of invention need not continue for more than two years, in order to constitute "abandonment" of

right to patent.

[Ed. Note.-For other definitions, see Words and Phrases, First and Second Series, Abandon-Abandonment.]

5. Patents 87-Evidence held to establish public use, constituting abandonment of right to patent (35 USCA §§ 31, 69).

Evidence held to establish a public use for more than two years, constituting abandonment of right to patent for machine for cleaning gasoline used in dry-cleaning plant, under Rev. St. 88 4886, 4920 (35 USCA §§ 31, 69; Comp. St. §§ 9430, 9466).

Appeal from the District Court of the United States for the Eastern District of Missouri; Charles B. Davis, Judge.

Patent infringement suit by Allinson Manufacturing Company against the Ideal Filter Company. From decree of dismissal, plaintiff appeals. Affirmed.

(W. P. Bair and Will Freeman, both of Des Moines, Iowa, on the brief), for appellant.

Harry A. Beimes, of St. Louis, Mo., for appellee.

Before LEWIS and VAN VALKENBURGH, Circuit Judges, and PHILLIPS, District Judge.

LEWIS, Circuit Judge. Appellant's bill of complaint charges that it is the owner by assignment made December 28, 1921, of all rights granted to William Allinson by U. S. Letters Patent No. 1,395,694, of date November 1, 1921, for an apparatus for purifying gasoline and for which Allinson made his application on October 9, 1920; that appellee, subsequent to the date of said Letters, has made and sold machines of the kind therein described and thus infringed on claims 14 and 15, which are in these words:

"14. An apparatus for purifying gasoline or the like, comprising a tank, a container below said tank, a restricted neck or passage leading from the bottom of said tank to the top of said container, an intake tube leading into the lower part of said container, and valve controlled, vertically spaced outlets for said tink."

"15. This claim is in the same words as claim 14, with the addition thereto of this clause: "And a pump for forcing gasoline or the like through said intake pipe."

The relief sought was judgment for profits from further infringement. Appellee anand damages and that appellee be enjoined swered and the case went to final hearing on the issues of (a) infringement; (b) anticipation of Allinson's discovery, as shown in prior named patents; (c) public use by Allinson of the claimed invention for more than two years prior to the filing of his application; and (d) abandonment by him prior to said application. The court found in favor of appellee on the two last named issues and dismissed the bill; no opinion or finding was expressed or made on the other two. Either issue decided by the trial court disposes of the whole controversy, if it was adjudged correctly; and that is the primary challenge in this appeal. The inquiry on both issues arises from constitutional provision and statutory requirements on the subject of patents. The first (article I, § 8):

"The Congress shall have power to promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries."

21 F.(2d) 22

The second, passed in exercise of the power (R. S. §§ 4886, 4920 [35 USCA §§ 31, 69; Comp. St. §§ 9430, 9466]), are these: "Any person who has invented any new and useful

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machine, ⚫ unless the same is proved to have been abandoned, may obtain a patent therefor." "In any action for infringement the defendant may prove on trial that it had been in public use or on sale in this country for more than two years before his application for a patent, or had been abandoned to the public."

And these requirements, both as to prior use and abandonment, present here questions of fact which were decided against appellant. [1] These issues are, of course, different one a statutory bar, and the other at large on facts to be established; but, plainly the latter may be made out on proof directed to what occurred either before or after the bar had fallen. The patentee may make his application within the two years limitation period, and yet if it be shown that within that period he relinquish all claim to his discovery, his inchoate right is thereby lost to him, for it is a sound principle that:

"This inchoate right, thus gone, cannot afterwards be resumed at his pleasure; for when gifts are once made to the public in this way, they become absolute." Shaw v. Cooper, 7 Pet. 292, 318 (8 L. Ed. 689).

The limitation period may have fully run, but poverty, ill-health or other circumstances over which the patentee had no control may relieve him from the bar. Smith v. Goodyear Dental Vulcanite Co., 93 U. S. 486, 501, 23 L. Ed. 952; Planing Machine Co. v. Keith, 101 U. S. 479, 488, 25 L. Ed. 939.. [2] And yet lapse of time, silence and inaction thereafter in making application for the monopoly may constitute abandonment. This is characterized as willful or negligent postponement, in contravention of the policy and objects of the Constitution and Acts of Congress on the subject, operating as a forfeiture of the patentee's rights and thus constituting abandonment by him, although there be no proof of an express intention on his part to relinquish his inchoate rights to the public. With these principles in mind, which, we think, the authorities hereinafter cited sustain, we will attempt to state all of the proof bearing on these two subjects. Before doing so we think it necessary to give a general account of the situation at the time Allinson first made his discovery and constructed and used his apparatus in 1914.

[3] Gasoline is used, and for long has been

used in clothes cleaning establishments for the removal of dirt, grease, oil and other soiling substances which accumulate on and in clothing and other textile fabrics. As it is used the gasoline becomes mixed with this refuse, both in solution and suspension, and they must be removed before it can be used again for cleaning purposes. Prior to 1914, or thereabout, there were several methods for doing this. Perhaps the first was the settling tank, into which the gasoline was poured and time given for precipitation, but this did not remove all impurities. In using this method it had become a common practice to put into the gasoline and thoroughly mix with it a solution of Gold Dust, caustic soda or like chemical as an aid to clarification. The filtration method was also used, and redistillation. Allinson was using the latter in his cleaning establishment at Des Moines in 1914. In July of that year he conceived the idea disclosed in his patent. He stopped using the distillation method. He thereafter used the egg-shaped container, in which he had been distilling dirty gasoline, as a tank, placing below it an inverted coneshaped member (called "container" in his patent) and connecting the two with a neck or narrow passage; he then extended his supply pipe through the tank (old still), on through the neck and into the cone-shaped member below, to within two inches of its bottom; he poured into the upper part of the tank a solution of caustic soda or other like chemical mixture, which sank through the neck and settled in a bed on the converging bottom of the cone-shaped member. Then by means of a pump attached to his supply pipe he forced the dirty gasoline into the bottom of the cone and it gradually rose through the chemical bed, through the neck or narrow passage and into the tank above, and was thus cleansed of its impurities and drawn off ready for reuse. This was a distinct improvement on the old methods. More of the gasoline was recovered and made fit for reuse and it was done more cheaply and more quickly than had been done by the older practices. As the gasoline passed upward through the chemical bed the removed greases and oils formed a soapy and dirty mixture which settled on top of the chemical and through which the rising gasoline must also pass, and this was in aid to the cleansing of the gasoline. The narrow passage between the cone below and tank above retarded the movement of gasoline upward and the narrowness and depth of the chemical prevented the forcing of open passageways by the rising gasoline through the accumulating bed. When the refuse piled up through

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