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21 F.(2d) 831

successive treatments effected by the two pairs of wedge-shaped intermeshing precrushing rollers, combined and operating in the manner recited, before the stalks passed through the mill rolls, great economy and efficiency was thereby attained. It is claimed by plaintiff that the two sets of precrushing rolls operate in a differentiating degree upon the cane. It appears from the record, however, that the differentiating action of claim 1 results solely from the fact that the rolls of the second pair of precrushing rolls are set nearer together than the rolls of the first pair. But this was a common practice in cane mills many years prior to applicant's invention. When the patentee placed an additional set of precrushing rolls on his machine, acting under the common practice, he made the opening there larger than between the precrushing rolls already on the machine, and the fact that he calls the action a differentiating action does not lend patentability to claim 1; there being no co-operation between the two pairs of precrushing rolls and no new result obtained. Each set of precrushing rolls works in the old and well-known way, so that the provision of two sets of precrushing rolls amounts to nothing else but duplication. Duplication of devices has never involved anything patentable. Topliff v. Topliff, 145 U. S. 156, 12 S. Ct. 825, 36 L. Ed. 658; Dunber v. Meyers, 94 U. S. 187, 194-196, 200, 24 L. Ed. 34; Troy Laundry Machinery Co. v. Rees (C. C. A.) 67 F. 336; Nathan Anklet Support Co. v. Cammeyer (C. C. A.) 264 F. 968, 971.

Claim 2 specifies that the teeth of the precrushing rolls nearest the juice-expressing rolls are arranged to produce a twisting action upon the cane as it passes through said rolls. This twisting action, however, also results solely from the fact that the rolls of the second pair of crushing rolls are set nearer together than the rolls of the first pair. No co-operation between the two sets of rolls and no new result were thus produced.

I am therefore constrained to hold that both claims are anticipated and lacking in novelty, in view of the prior practices and prior patents which are disclosed in this record.

1(b) The defendant further asserts that the claims in suit are invalid for lack of originality because the patentee obtained his ideas from one Dardis. The record shows that Dardis, an old sugar man, died in February, 1923. The witness Farrel talked with him in 1913, and Dardis at that time spoke to him about two sets of precrushing rolls. On May 21, 1913, Dardis wrote to the witness Bowen, 21 F. (2d)-53

chief engineer of the defendant company, and said, inter alia:

"In my opinion, I would put 2 crushers in front of a mill, first, one with 2" opening and, second, one with as little opening as possible. So I think it is perfectly

logical and a good point to put 2 crushers with 9 rollers following."

And on January 23, 1914, Dardis again wrote Bowen and said:

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"I am more than ever in favor of two crushers in front of a 9-roller mill. You want to get busy on Mr. Ros and sell him a new mill and two crushers."

The date of each letter is manifestly prior to any date set up by the plaintiff, and the letters clearly indicate that Dardis was at that time in possession of the alleged invention in issue here. Of course, this would not invalidate the claims of the patent were it not for the question of originality which is presented here. It seems clear that the principle of the alleged invention was explained in 1913 to the witness Thomas, who some time later, but prior to the application date of the patent in suit, described the same to the patentee. I believe that a communication about the invention from Dardis to O'Neil has been satisfactorily shown, and that it has been full and clear as to all essential elements concerning it, and plaintiff has failed to rebut this testimony. I therefore hold that claims 1 and 2 of the patent in suit are invalid because the patentee is not the inventor of the improvements

therein set forth.

Infringement.

2. Even if the claims could be held valid, it must be held that defendant's machine does not infringe. Claim 1 calls for a plurality of sets of toothed precrushing rolls which are adapted to operate in a differentiating degree upon the cane. For a definition of that phrase, we turn to the specification of the patent, and from that we learn that, in order to obtain the action called for in claim 1, the cane must still be held between the first set of precrushing rolls as it passes through the second set of rolls. Such action could only take place if the second pair of rolls was revolving at a higher peripheral speed than the first set of rolls. It is stipulated that in defendant's device the second set of rolls revolves more slowly than the first. Therefore claim 1 is not infringed.

Claim 2 specifies two sets of toothed precrushing rolls in combination with juice-expressing rolls; the teeth of the precrushing rolls nearest the juice-expressing rolls being

arranged to effect a twisting action upon the cane as it passes through the last-mentioned precrushing rolls. The specification is silent as to what produces the twisting action upon the cane, nor is there any competent evidence in the record to show what brings about a twisting action in plaintiff's machine. In defendant's machine there is no twisting action according to the evidence adduced at trial. Therefore defendant's machine does not infringe claim 2.

[3] Plaintiff has shown that its equipment has met with favor and that large sales have been made. It is a well-settled rule, however, that the fact that a device has gone into such use has no weight upon the question of patentable novelty, except when it is in doubt. Commercial success will never sanctify a patent which is void. The sole ground upon which commercial success is admissible is to

add the weight of public indorsement where validity is doubtful. Duer v. Corbin Cabinet Lock Co., 149 U. S. 216, 13 S. Ct. 850, 37 L. Ed. 707. When there is no invention, the extent of the use is a matter of no importance. Boss Mfg. Co. v. Thomas (C. C. A.)

182 F. 811.

Let the bill be dismissed with costs to defendant. Decree accordingly.

In re SULLIVAN.

District Court, D. Massachusetts. June 9,

1927. No. 34444.

1. Bankruptcy 165(4)-Assignment of valid accounts to take the place of fictitious ac

LOWELL, District Judge. [1] On May 24, 1923, Sullivan borrowed about $40,000 from the Manufacturers' Finance Company on the security of a number of assigned accounts. The arrangement was that Sullivan should collect the accounts and turn the proceeds over to the company. The Manufacturers' Company became suspicious of Sullivan and investigated his affairs. It found that his business was in a precarious condition, and that many of the accounts which he had assigned to it were imaginary ones. At this time, and when, as the referee found, the company had reasonable cause to believe that Sullivan was insolvent, the company required him to replace the fictitious accounts with good ones; this was done. An involuntary petition in bankruptcy was filed within four

months after this time.

The learned referee held that a preference had been effected. He evidently considered that the Manufacturers' Company stood in the same position as an ordinary creditor. I hesitate to disagree with the learned referee, tion was the same as that of an ordinary creditor. The company lent its money on the faith of the bankrupt's assigning good ac

but it does not seem to me that its situa

counts. When it discovered that the accounts were bad-in fact had no existence-it required him to do merely what he had agreed to do. His estate has not been depleted by the transfer of the good accounts, because the bankrupt merely did under compulsion what he should have done in the first place; and his estate would not have received the benefit of the money loaned unless the Manufacturers' Company had trusted him to assign good

accounts.

See Glenn, Creditors' Rights and Reme

counts assigned to creditor held not prefer- dies, § 440 et seq.

ence.

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The case at bar is similar to those which involve the doctrine of what is known as an "equitable lien." Sexton v. Kessler, 225 U. S. 90, 32 S. Ct. 657, 56 L. Ed. 995.

See, also, Sabin v. Camp (C. C.) 98 F. 974; Duplan Silk Co. v. Spencer (C. C. A.) 115 F. 689; Pyle v. Texas Transport Co. (D. C.) 192 F. 725; Lovell v. Newman (C. C. A.) 192 F. 753; Chapman v. Hunt (C. C. A.) 254 F. 768; Re Tweedale (1892) 2 Q. B. 216.

A case which may at first sight seem to be contrary to my decision in the case at bar is Clarke v. Rogers, 228 U. S. 534, 33

Robert A. B. Cook, of Boston, Mass., for S. Ct. 587, 57 L. Ed. 953, in which the Sutrustee.

Harrison J. Barrett, Percy A. Atherton, and George W. Reed, all of Boston, Mass., for Manufacturers' Finance Co.

preme Court held that restitution of stolen funds by a trustee constituted a preferential transfer. As was pointed out, however, by Mr. Glenn at section 440 of the work al

21 F.(2d) 835

ready cited, the trustee did not return to his
trust estate the property belonging to it.
In the present case the bankrupt turned over
to the company good accounts, which under
the arrangement he was required to do.
[2] The counsel fees paid by the Manufac-
turers' Company as allowed by their contract
to loan money on the security of the assigned
accounts need not be returned. In re Lutz
(D. C.) 235 F. 970; In re Rosenblatt (D. C.)
299 F. 771.

The order of the referee is set aside.

A. H. BULL S. S. Co. v. UNITED STATES. District Court, S. D. New York. July 5, 1927. Admiralty 50-Cargo owner may intervene in shipowner's libel in personam against United States as owner of dredge for damages from collision (Public Vessels Act of 1925 [46 USCA §§ 781-790]; Suits in Admiralty Act [46 USCA § 743]).

"First. The Public Vessels Act, approved March 3, 1925, provides that suits against the United States under said act may be commenced only by original libel, and does not contemplate the procedure herein attempted by the petitioner.

"Second. It fails to allege that the Chinook was not within the waters of the United States at the time said petition was filed.

"Third. It fails to allege that the Chinook was within this district at the time said petition was filed."

The right of the original libelant to sue under the Public Vessels Act of 1925, approved March 3, 1925 (46 USCA §§ 781790 [Comp. St. §§ 125134-1 to 1251410]), not only for damages to its own vessel, but for cargo damage in behalf of the owner of the cargo, is not questioned, nor is the propriety of intervention by the cargo owner in such a suit against a private party open to doubt. The Beaconsfield, 158 U. S. 303, 15 S. Ct. 860, 39 L. Ed. 993. The exceptions, therefore, must fail, unless they find support in the statute under which the suit is brought. But no support is there to be found, for it is there provided that suits brought against the United States pursuant to the Public Vessels Act of 1925 shall be subject to and proceed in accordance with the provisions of the Suits in Admiralty Act, approved March 9, 1920 (46 USCA §8 741-752 [Comp. St. §§ 125114-125141]), which in turn provides that "such suits shall proceed and shall be heard and determined according to the principles of law and to the rules of practice obtaining in like cases between private parHarry D. Thirkield, of New York City, ties." Section 3 (46 USCA § 743 [Comp. St. for petitioner. § 1251b]).

Under Public Vessels Act of 1925 (46 USCA §§ 781-790 [Comp. St. §§ 12514-1 to 12514-10]), and Suits in Admiralty Act, § 3 (46 USCA § 743 [Comp. St. § 1251b]), the owner of a ship's cargo may intervene in shipowner's libel in personam against the United States to recover damages to vessel and cargo resulting from collision with government owned dredge.

In Admiralty. Libel by the A. H. Bull In Admiralty. Libel by the A. H. Bull Steamship Company against the United States. On exceptions of respondent to intervening petition of the National Sugar Refining Company of New Jersey. Exceptions

overruled.

Charles H. Tuttle, U. S. Atty., of New York City (Horace M. Gray, Sp. Asst. U. S. Atty., of New York City, of counsel), for the United States.

THACHER, District Judge. The libelant herein, as owner of the steamship Clare, and as bailee of the cargo laden thereon, filed its libel in personam against the United States of America as owner of the dredge Chinook in a cause of collision, seeking to recover damages sustained by reason of injuries to its vessel and to the cargo laden thereon resulting from the collision. The cargo owner has now filed its petition seeking to intervene pro interesse suo, and is met by exceptions filed by the respondent as follows:

The filing of a petition of intervention is not the commencement of an original suit. The original suit being well founded, and the cargo owner being entitled to intervene according to "the rules of practice obtaining in like cases between private parties," the exceptions necessarily fail. It may be added that in cases of collision it is of the utmost importance, in order to avoid circuity of actjon, that the rights of all concerned should, in so far as possible, be determined in a single suit. There is certainly nothing in the statute from which an intention can be inferred to exclude the owner of the cargo from a suit brought in his behalf by the owner of the vessel to recover damages to his property. The exceptions will be overruled.

CRAIL v. ILLINOIS CENT. R. CO.

that a recovery should be had on the basis of

District Court, D. Minnesota, Fourth Division. $9.70 per ton. Thereafter the stipulation of

September 23, 1927.

Carriers 135-Amount recoverable by shipper for coal lost in transit is determined by market price in quantity such as that lost.

A carload of coal, when delivered by the carrier, was 5,500 pounds short. To purchase that quantity and no more in the open market

at the place and time of delivery, the shipper

would have been required to pay $9.70 per ton. Held, that such price measured his loss, and not the wholesale price when bought in carload lots.

At Law. Action by G. I. Crail, doing business as the P. McCoy Fuel Company, against the Illinois Central Railroad Company. Judgment for plaintiff.

459.

See, also, 2 F. (2d) 287 and 13 F. (2d)

Stanley B. Houck, of Minneapolis, Minn., for plaintiff.

Edward C. Craig, of Chicago, Ill., and Guesmer, Carson, Brown & Loughin and Edwin C. Brown, all of Minneapolis, Minn., for defendant.

facts was amended and amplified, and with the stipulation so changed the case was again presented to the court on a second trial. This court is not satisfied that the amended stipulation of facts justifies the conclusion that the case has been substantially changed.

Following the decision of the Court of Appeals, therefore, it is the duty of this court to allow a recovery at the rate of $9.70 per ton for the coal which was lost, and this will be done.

interest and importance. It is assumed that The case, however, is of rather unusual it is not inconsistent with the fullest measure of respect for the appellate court, to offer further suggestions in the interest of justice

upon the questions involved. It is for this

court to follow the decision of the appellate tribunal, but that tribunal itself may at some time wish to re-examine the matters which are here in controversy. It is in that light and for that purpose only that the suggestions which follow are made.

The case at bar is the ordinary case of a George A. Kingsley, of Minneapolis, commodity purchased in bulk for the purMinn., amicus curiæ.

CANT, District Judge. This is an action brought by the consignee of a carload of coal against the railroad company which had undertaken to transport the coal. The amount of the shipment was 88,700 pounds. Of this amount 5,500 pounds were lost in transit. The destination was Minneapolis, Minn., and the delivery was on an industry railway track running alongside of or into plaintiff's coal yard at that place. It is agreed that, at the time and place of delivery, coal of the kind here in question was worth $5.75 per ton, plus freight, in carload lots of from 60,000 to 120,000 pounds. It is also agreed that the same kind of coal at retail in the Minneapolis market, at the time in question, delivered at the place of business or home of the consumer, was worth $9.70 per ton, plus freight. Plaintiff claims that he is entitled to recover at the rate of $9.70 per ton for the coal which was lost. Defendant admits liability, but claims that the amount of recovery should be limited to $5.75 per ton. No freight was paid on the coal which was lost, and that item may be eliminated from the discussion. The facts were presented to the court originally by stipulation, and the opinion of this court thereon is found at 2 F.(2d) 287. That case was reversed by the Circuit Court of Appeals, and the opinion thereon is found at 13 F.(2d) 459. The appellate court there held

pose of selling the same again at an advance, if possible, but without any necessity or occasion for going into the local market to replace any portion of the commodity which might be lost in transit. Under the circumstances hereinbefore set forth, as amplified by the stipulation of facts, what is the measure of damages in this case? Is plaintiff entitled to recover at the rate of $5.75 per ton, or at the rate of $9.70 per ton for the coal which has been lost?

Basically, the case is one for the recovery of damages for breach of contract. This particular controversy belongs to a subclass of breach of contract cases. It involves a breach by a common carrier of its agreement to transport and deliver freight. The same general rules apply here as in all other cases of breach of contract. It will be seen that certain subsidiary rules are specially applicable. The difficulty in such cases arises in estimating the amount of the loss which the plaintiff has sustained. The courts have said that in this connection each case must be governed by its own facts. Magnin v. Dinsmore, 62 N. Y. 35, 20 Am. Rep. 442; Magdeburg General Ins. Co. v. Paulson (D. C.) 29 F. 530, 532. This does not mean that the cases are beyond the rules. They are not; it is at this point that the subsidiary rules intervene.

In the former opinion of this court certain outstanding features of the case were not made sufficiently clear.

21 F.(2d) 836

1. Cases of the character here in question fall into certain groups or classes, and rules which apply to one class quite often do not apply to another. A classification upon one basis is as follows:

(a) Cases where general damages only are involved.

(b) Cases where special damages are claimed.

of unusual or special circumstances. Such circumstances, however, give rise to no claim for additional or special damages on account thereof, unless the circumstances were known in advance by the respective parties, and unless the consequences of the breach and loss under such circumstances were known to and in contemplation of the parties when the contract was made. 17 C. J. 712, § 76; 17 C.

Upon another basis, the classification may J. 746, § 77. be as follows:

(a) Cases where the consignee is under no necessity or compulsion to go into the local market and purchase commodities with which to replace those which have been lost.

(b) Cases where by reason of special circumstances the consignee is under some reasonable compulsion to replace the lost commodity by purchasing in the local market.

There are doubtless other classifications of less importance. The classifications above specified may very nearly duplicate each other. That is, all cases where there is no necessity of replacing the lost commodity would generally fall under the head of general damage cases; and very generally cases where the lost commodity must be replaced would fall under the head of special damage cases, but the distinguishing features of both classifications are important, because sometimes

one basis of classification is emphasized by

the courts and sometimes another, and because collectively they furnish the bases for the various rules which are announced; which rules, as applied to a particular situation, may be quite correct, but which, if applied to a different set of facts, may work an injus

tice.

2. The fundamental rule in all cases involving damages for breach of contract is that the damages recoverable are such only as, in theory of law, may fairly be said to have been within the contemplation of the parties when the contract was made. 17 C. J. 742-746, § 76; Harvey v. Connecticut & Passumpsic R. R., 124 Mass. 421, 423, 424, 26 Am. Rep. 673.

By the expression "general damages" is meant such damages as follow naturally and in the usual course of things from a breach of contract. In all ordinary cases it is general damages only which are held to have been within the contemplation of the parties. In such cases the question is, What is the immediate loss? without going beyond the first step. 17 C. J. 712, § 20; 17 C. J. 742, § 76.

"Special damages" are such as do not follow naturally or in the usual course of things from such a breach, but are such as arise out

3. In this case plaintiff sues for general damages only. There is no allegation of special damages in the complaint and no proof thereof in the stipulation of facts. Here, if the fact is at all important, there is no claim or proof that, prior to the loss in question, defendant had any knowledge that the coal was being purchased for the retail trade; and the circumstance of such intended use appears, if at all, only as a matter of inference from the stipulated facts.

4. In cases such as the one at bar, therefore, where general damages only are claimed, a recovery for proximate loss only can be had a loss which follows naturally and in the usual course of things from the breach of contract. This is an unvarying rule to which there are no exceptions. With subsidiary rules there may be variations or exceptions. In such cases as this the court does not go

Southern

beyond the first step, nor concern itself with
consequences which are remote.
Pacific Co. v. Darnell-Taenzer Co., 245 U. S.
531, 533, 38 S. Ct. 186, 62 L. Ed. 451. The
question is, what loss plaintiff had sustained
at the moment the car of coal was switched
into his yard, with the 5,500 pounds missing
therefrom? It is not what loss might be fig-
ured out at a later time under entirely new
and different conditions. Plaintiff's cause
of action accrued at once upon failure to de-
liver, and without waiting for later events.
Southern Pacific Co. v. Darnell-Taenzer Lum-
ber Co., supra, page 534 (38 S. Ct. 186). It
made no difference whether the coal was to
be sold at wholesale or at retail, or was to
be consumed by plaintiff himself. The prox-
imate loss "is the loss of what the con-
tractee would have had if the contract had
been performed." Chicago, M. & St. P. Ry.
Co. v. McCaull-Dinsmore Co., 253 U. S. 97,
40 S. Ct. 504, 64 L. Ed. 801. In this case
that would have been the 5,500 pounds of
coal in the car, which amount of coal at the
time of delivery, was missing therefrom.

5. A subsidiary rule, applicable in cases of this character, is that plaintiff is entitled to recover the value of the commodity which has been lost, as that value would have been

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