Imágenes de páginas


of diverse citizenship, and that diverse citi- į citizenship was an error, and that a corzenship is alleged and admitted, the judg-rect statement would have disclosed a lack ment or decree which is entered is conclusive, of jurisdiction. and cannot be upset by either of them in As appears from the record, the Huguley any other tribunal on the mere ground that Manufacturing Company was the owner of there was in fact no diverse citizenship. the equity of redemption at the time the Skillern v. May, 6 Cranch, 267, 3 L. ed. 220; foreclosure suit was instituted. It, thereM'Cormick v. Sullivant, 10 Wheat. 192, 6 fore, was unnecessary to make the original L. ed. 300; Hancock v. Holbrook, 119 U. S. grantor in the trust deed a party to the liti586, 30 L. ed. 538, 7 Sup. Ct. Rep. 341. In gation. All that could be accomplished by Des Moines Nav. & R. Co. v. Iowa Home- its presence would be a decree putting at stead Co. 123 U. S. 552, 557, 31 L. ed. 202, an end all question of its interest, and, pos204, 8 Sup. Ct. Rep. 217, 219, we said: sibly, if a sale did not pay the debt, a judg.

"It was settled by this court, at a very ment over for the deficiency. But neither of early day, that, although the judgments and these results would affect the jurisdiction of decrees of the circuit courts might be er- the court, so far as the owner of the equity roneous, if the records failed to show the of redemption is concerned, or impede the facts on which the jurisdiction of the court transfer of the title by foreclosure and sale rested, such as that the plaintiffs were citi- to the purchaser. zens of different states from the defendants, Under the averments of the ancillary bill yet that they were not nullities, and would and answer it must be accepted that there bind the parties until reversed or otherwise were two corporations under the same name, set aside.”

--the Alabama & Georgia Manufacturing In Dowell v. Applegate, 152 U. S. 327, 38 Company,—one chartered in Alabama, and L. ed. 463, 14 Sup. Ct. Rep. 611, the valid- the other in Georgia. It is doubtless true ity of a decree rendered by a Federal court that, for the purposes of jurisdiction in the was challenged on the ground of a want of Federal courts, these corporations jurisdiction. In the opinion the question deemed to be citizens of the states in which was thus stated (p. 337, L. ed. p. 467, Sup. they were organized. It is also true that Ct. Rep. p. 615):

there was no formal merger of the two "If the Federal court erred in assuming corporations into one; that they remained or retaining jurisdiction of Dowell's suit,-in law two separate legal persons, and that a question not necessary to be examined, each was entitled to corresponding rights. would it follow that its final decree, being But courts will sometimes look beyond the unmodified and unreversed, can be treated formal and corporate differences. Especialas a nullity when assailed collaterally by ly is this true of courts of equity. Substanone who was a party to the suit in which it tial rights will be regarded rather than the was rendered ?"

mere matter of organization. Lehigh Min. And after quotations from several authori- & Mfg. Co. v. Kelly, 160 U. S. 327, 40 L. ed. ties the conclusion was reached (p. 340, L. 444, 16 Sup. Ct. Rep. 307, illustrates this. ed. p. 468, Sup. Ct. Rep. p. 616):

There it appeared that the Virginia Coal & “This disposes of the first objection urged Iron Company was a corporation organized against the decree in the Federal court under under the laws of Virginia, and therefore a which Dowell purchased. That decree can- citizen of that state; that it claimed title not be treated, in this suit, as void for to certain lands in Virginia in the posseswant of jurisdiction."

sion of the defendant, also a citizen of VirSee also Evers v. Watson, 156 U. S. 527, ginia. There being no diversity of citizen39 L. ed. 520, 15 Sup. Ct. Rep. 430.

ship, an action could be maintained only in Some of these cases, as appears from the a court of the state. To avoid this, and to quotations, go to the extent of holding that, place the litigation in the Federal court, although on the face of the record, jurisdic- the stockholders of the coal and iron comtion does not appear, yet the judgments or pany organized, under the laws of Pennsyldecrees are binding upon the parties thereto, vania, the Lehigh Mining & Manufacturing and cannot be assailed collaterally. A for Company. The former company thereupon tiori must it be true that when, on the face conveyed all its rights to the latter, which of the record, jurisdiction appears, the judg- brought its action for the recovery of the ment or decree must be held conclusive property in the United States circuit court against a collateral attack by either of the for the district of Virginia. While it was parties thereto. The Huguley Manufactur-conceded that the purpose with which a ing Company was, as is conceded in these party makes a conveyance does not affect the ancillary proceedings, a party to the origi- title of his grantee, and while it was not nal litigation, and cannot now be permitted doubted that the two corporations were septo challenge the jurisdiction of the Federal arate entities, yet it was also held that, incourt on the ground that its admission of asmuch as the stockholders in each were the same, and the organization of the Pennsyl- | bama), i. e., that it be 'domesticated in vania company was only for the purpose of Georgia by the laws of that state, but the apgetting the litigation into the Federal court, plication was for the creation of a sepit was a fraud on the jurisdiction of that arate and independent corporation under the court, and its order dismissing the action for same name; and on March 21, 1866, “The want of jurisdiction was affirmed. It was Alabama & Georgia Manufacturing Comsaid in the opinion (p. 339, L. ed. p. 449, pany,' as a second, distinctly independent Sup. Ct. Rep. p. 612):

corporation, was granted a charter by the "The arrangement by which, without any legislature of the state of Georgia." valuable consideration, the stockholders of Whatever may have been within the scope the Virginia corporation organized a Penn- of the ulterior purpose of the Georgia insylvania corporation, and conveyed these corporation, the immediate purpose was the lands to the new corporation for the express development of a single plant, and that purpurpose—and no other purpose is stated or pose was carried into effect. By the charsuggestedof creating a case for the Federal ters the office of the Alabama company was court, must be regarded as a mere device located in Alabama, and that of the Georgia to give jurisdiction to a circuit court of the company in Georgia. When the trust deed United States, and as being, in law, a fraud was executed, it was executed in the name upon that court, as well as a wrong to the which was common to both corporations, but defendants. Such a device cannot receive in pursuance of resolutions passed at an our sanction. The court below properly de- office in Georgia. It would be unjust to imclined to take cognizance of the case." pute to these incorporators a design to mis

In the case before us there were also two lead the holders of the indebtedness of the corporations, distinct legal entities, yet bear company by giving to them a security which ing the same name,—the Alabama & Georgia rested alone upon the inconsiderable fracManufacturing Company. It may well be tion of property then located in Georgia, doubted whether any injustice has been done when, on the face of the instrument, it purto the Alabama company by the long litiga- ported to convey the entire plant. Evidenttion. In the brief of one of the counsel for ly the proceedings were had on the supposirespondents, after stating the organization tion that there was but a single entity. of the Alabama company, it is said:

That entity was indebted, and it gave the “In order to carry out the general plans trust deed as security therefor. When the and purposes of the incorporators and or- foreclosure suit was filed it would be also ganizers of the said Alabama company, thus an unjust imputation to suppose that the already organized and established, it was owners of the property carried on the litideemed necessary and important that these gation for years, knowing that the proper same original incorporators and organizers parties were not present in court, and that of the said Alabama corporation and their the outcome of that litigation meant nothsuccessors should control the water rights ing. Evidently this defense, springing from of the Chattahoochee river, not only through the existence of two corporations, was an the riparian rights already granted them on afterthought, when all other resources had the western, or Alabama, side of the river by failed, and equity may well say that to susthe state of Alabama, but through those of tain the present contention would give judithe state of Georgia on the eastern side of cial sanction to inexcusable trifling with the river as well, i. e., at the point on the courts. It is always to be understood that eastern bank opposite where their manufac- Federal tribunals are not moot courts, and turing plant in Alabama had already been that parties having substantial rights must, located. These incorporators had in view when brought before those tribunals, present the then purpose of utilizing, if not imme- those rights, or may lose them. diately, at least at some future time, the rec

The judgment of the Court of Appeals is ognized fine water power of the intervening reversed, and that of the Circuit Court is afChattahoochee river, by the proposed ac

firmed. quisition of other lands on the eastern, or Georgia, side of the river, and the erection

(198 U. S. 229) thereon of another independent manufactur- JOSEPH L. HARLEY, Appt., ing plant, and in such event, of using Columbus, or La Grange, Georgia, for its of

UNITED STATES. fices and shipping points. To that end the said incorporators did not elect to ask the Court of claims - jurisdiction contract legislature of Georgia for any express stat- right to compensation for use of patented utory license authorizing the pre-existing device by the United States. Alabama company to exercise in Georgia the same powers and rights which had been giv. The use by the United States of a device patenten it by the parent state of its creation (Ala- ed by a government employee with the under.


standing on his part, not shared by the gov- and explained to him the operation of the ernment officials, that compensation would be register, and the Secretary was at the same made, does not give a contract right to such time informed that this was the register compensation on which a claim can be founded within the jurisdiction of the court of which the claimant had invented. The Secclaims,-especially where demand was first retary approved the form of register, and made by the petition in that court, after a de directed that such registers be made and atlay of fourteen years.

tached to the presses in the Bureau.

"Before such registers were manufactured [No. 195.]

the claimant remonstrated to the effect that he wished first to secure a patent. The Chief

of the Bureau replied that he would see the Argued April 6, 1905. Decided May 8, 1905. claimant protected, and would get him a

patent attorney, who would explain the law PPEAL from the Court of Claims to re- to him. This the Chief of the Bureau did,

view a judgment dismissing a petition and the attorney so selected proceeded to which sought compensation for the use by procure the patent before set forth, the the United States of a patented device. Af- claimant, not the defendants, paying him, firmed.

and the costs and expenses thereof. The atSee same case below, 39 Ct. Cl. 105. torney so selected at the same time informed The facts are stated in the opinion.

the claimant that the manufacture and use Messrs. w. w. Dodge and A. A. of registers in the Bureau would not interHoehling, Jr., for appellant.

fere with or prevent the procurement of the Mr. Charles C. Binney and Assistant patent. Attorney General Pradt for appellee.

"After being so advised, the claimant

raised no further objection to the registers Mr. Justice McKenna delivered the opin- being manufactured and used, and tacitly acion of the court:

quiesced in the same. Appellant sued in the court of claims to

“There was no agreement or understandrecover the sum of $102,000, for the use, ing between the parties in regard to royalty during the six years preceding the com

or the payment of remuneration for the use mencement of the suit, of a device invented of the claimant's invention in the governby the appellant for registering impressions such as may be inferred from the preceding in connection with printing presses.

The court of claims dismissed the petition. The conversations. On the part of the claimant findings of the court of claims are as fol

it was supposed and understood that he

would be entitled to compensation, and that lows: “II. In November, 1869, the Secretary of

it would be allowed and paid by the Secre

But on the part of the Treasury determined that certain valu- tary of the Treasury. able securities should not be printed in the the Secretary and Chief of the Bureau it Bureau of Engraving and Printing until

was supposed and understood that the claimproper and reliable registers should be at- ant, being an employee of the Treasury Detached to the presses. While the Chief of partment, would neither expect nor demand

remuneration. the Bureau was endeavoring to devise and

“III. That ever since the issuance of said procure a trustworthy form of register, the claimant brought to hii the drawings of a and has used continuously, from the date

letters patent the defendant has constructed, device which he had invented, being substan- of said letters patent, to wit, March 1, 1870, tially the device described in the foregoing letters patent. The Chief of the Bureau or- upon and in connection with plate-printing dered a register to be immediately made aft. presses used by the defendant in the Bureau er the claimant's device.

of Engraving and Printing and in the Treas

At the time of giving such order he understood that the ury building, the device aforesaid, so pat

ented to the claimant, for the purpose of device was the claimant's invention.

“The register so ordered being completed, registering the number of impressions made and tried, and found satisfactory, the Chief by the various plate-printing presses, both of the Bureau proposed to take the claim- hand and steam, employed and used by the ant to the Secretary of the Treasury, that defendant in the said Bureau of Engraving he might explain it to him. The claimant and Printing and in the Treasury Departthereupon objected that the invention was ment building. not yet patented, and that he wished, before

"IV. The claimant, at the time of the exhibiting it, to obtain a patent for his in making of his invention, before described, dividual protection. The Chief of the Bu- was assistant master machinist in the Bureau replied, "Certainly; I will see that you reau of Engraving and Printing. He was are protected.' The claimant, then tacitly never assigned to the duty of making inyenconsenting, was taken before the Secretary,' tions, and it was not a part of his duty to do so; and the invention before described tends that he was; but manifestly he was was made within his own time, and exclu- not, or the curious opposition between his sively at his own cost, and was a completed expectation and that of the Secretary of the invention, properly and sufficiently set forth Treasury and Chief of Bureau could not in drawings when first brought to the Chief have occurred. And we cannot assent to the of the Bureau, as set forth in finding II. suggestion that he "was by coercion prevent

V. The defendants were in the undis- ed” from making a demand “in terms” by turbed use of the claimant's invention from his subordinate position. How long must July 24, 1878, to July 24, 1884, by attach- we suppose such coercion lasted, and that ing such registers to a great number of their he could have permitted a misunderstanding presses. During that period the claimant of his purpose ? Six years passed, and the made no objection to such use of his in-Chief of Bureau with whom the negotiations vention, and failed to give notice to the Sec- were made went out of office; another sucretary of the Treasury or the Chief of the ceeded. No demand was made of either for Bureau of Engraving and Printing that he compensation. Further time passed, and would · demand royalty or remuneration other Chiefs of Bureau succeeded. There therefor.

was a succession of Secretaries of the Treas"VI. The average number of presses with ury; no demand was made of any of them. claimant's device used by the defendants be- His first demand was the petition in this tween July 24, 1878, and July 24, 1884, was case, -over fourteen years from his first in200 per day, covering 1802 working days.” terview with the Secretary of the Treasury.

The question in the case is whether, on This delay cannot be overlooked or interthese facts, a contract arose between the preted favorably to appellant's contention. United States and the appellant, whereby He sues for $102,600, and this does not inthe United States promised to pay him for clude the royalties that he contends he was the use of his device.

entitled to for the first six years the device We held in Russell v. United States, 182 was used. He claims a royalty of 25 cents U. S. 516–530, 45 L. ed. 1210–1215, 21 Sup. a day on an average of two hundred maCt. Rep. 899, that in order to give the court chines—that is, $50 a day. He was an emof claims jurisdiction, under the act of ployee of the government, at a modest salMarch 3, 1887 (24 Stat. at L. 505, chap. ary, and we cannot conceive there was no in359, U. S. Comp. Stat. 1901, p. 752), defin- ducement in $50 a day to an explicit deing claims of which the court of claims had mand of his rights, or that he was willing jurisdiction, the demand sued on must be to wait, or felt himself coerced to wait, for founded on "a convention between the par- their realization for fourteen years, and ties,-'a coming together of minds.'And even to lose compensation for six years by we excluded, as not meeting this condition, the operation of the statute of limitations. those contracts or obligations that the law The rights of the government are obvious. is said to imply from a tort. Schillinger v. The contention of the appellant forces on it United States, 155 U. S. 163, 39 L. ed. 108, a liability that it might not have taken. It 15 Sup. Ct. Rep. 85; United States v. Ber- was given no election of the terms upon dan Firearms Mfg. Co. 156 U. S. 552, 39 which it would use the register, or whether L. ed. 530, 15 Sup. Ct. Rep. 420.

it would use it at all. Of course, this arIn the case at bar the court of claims gument is based on the fact that there was finds that the appellant "supposed and un- no coming together of the minds of the parderstood that he would be entitled to com- ties, or, as expressed by the findings of the pensation, and that it would be allowed and court of claims, that "it was supposed and paid by the Secretary of the Treasury;" but understood” by the officers of the governit also finds that "on the part of the Secre- ment that appellant "would neither expect tary and Chief of Bureau (Engraving and nor demand remuneration.” And this fact Printing) it was supposed and understood distinguishes the case from McKeever v. that the claimant (appellant), being an em- United States, 14 Ct. Cl. 396, affirmed by ployee of the Treasury Department, would this court; also from United States v. Lyneither expect nor demand remuneration.” nah, 188 U. S. 445, 47 L. ed. 539, 23 Sup. That there was "a coming together of minds" Ct. Rep. 349, and the other cases cited by is therefore excluded by the findings. And appellant. the use of the device cannot give a right Judgment affirmed. independent of the understanding under which it was used. The appellant should Mr Justice Peckham dissents, have been explicit in his demand. He con


(198 U. S. 236) BOARD OF TRADE OF THE CITY OF See same case below in Circuit Court of CHICAGO, Petitioner,

Appeals for Eighth Circuit, 61 C. C. A. 11, V.

125 Fed. 161; and in Circuit Court of ApCHRISTIE GRAIN & STOCK COMPANY peals for Seventh Circuit, 64 C. C. A. 669, and C. C. Christie. (No. 224.)

130 Fed. 507.

The facts are stated in the opinion. L. A. KINSEY COMPANY et al., Petition- No. 224, and respondent in No. 280.

Mr. Henry S. Robbins for petitioner in ers,

Messrs. James H. Harkless, W. H.

Rossington, Charles S. Crysler, Charles BOARD OF TRADE OF THE CITY OF Blood Smith, Clifford Histed, J. S. West, CHICAGO. (No. 280.)

and Chester A. Krum for respondents in No.

224. Injunction against distributing market quo- Messrs. Lloyd Charles Whitman, E.

tations-effect of illegality of transactions D. Crumpacker, Jacob J. Kern, John A. -monopoly-contracts in restraint of Brown, Charles D. Fullen, and Peter Crumtrade.

packer for petitioner in No. 280.

Messrs. Julien T. Davies, Abram I. El1. The use and distribution of the continuous kus, and Garrard Glenn by special leave for

quotations of prices on sales of grain and Edwin Hawley and Frank R. Ray.
provisions for future delivery, which are
collected by the Chicago board of trade, and
which cannot be obtained by those so using

Mr. Justice Holmes delivered the opinion and distributing them without a known of the court: breach of the confidential terms on which These are two bills in equity brought by they are communicated by the board of trade the Chicago board of trade to enjoin the to its customers, may be enjoined, even assuming that such quotations relate to "pre. principal defendants from using and distribtended buying and selling,” within the mean-uting the continuous quotations of prices on ing of Ill. act June 6, 1887, prohibiting the sales of grain and provisions for future dekeeping of places where such transactions livery, which are collected by the plaintiff, are committed.

and which cannot be obtained by the de2. Contracts with telegraph companies by fendants except through a known breach of

which the Chicago board of trade limits the communication of quotations of prices on

the confidential terms on which the plaintiff sales of grain and provisions for future de communicates them. It is sufficient for the livery, collected by it, which it might have purposes of decision to state the facts, withrefrained from communicating to anyone, do out reciting the pleadings in detail. The tempt at monopoly, and are not contracts plaintiff was incorporated by special charin restraint of trade, either under the act ter of the state of Illinois on February 18, of July 2, 1890 (26 Stat. at L. 209, chap. 1859. The charter incorporated an existing 647, U. S. Comp. Stat. 1901, p. 3200), or at board of trade, and there seems to be no reacommon law.

son to doubt, as indeed is alleged by the

Christie Grain & Stock Company, that it [Nos. 224, 280.]

then managed its chamber of commerce sub

stantially as it has since. The main feature Argued April 20, 21, 25, 1905. Decided May of its management is that it maintains an 8, 1905.

exchange hall for the exclusive use of its

members, which now has become one of the ON N WRIT of Certiorari to the United great grain and provision markets of the

States Circuit Court of Appeals for the world. Three separated portions of this Eighth Circuit to review a decree which re- hall are known respectively as the wheat versed a decree of the Circuit Court for the pit, the corn pit, and the provision pit. In Western District of Missouri, enjoining the these pits the members make sales and puruse and distribution of market quotations chases exclusively for future delivery, the collected by the Chicago board of trade, and members dealing always as principals beremanded the cause with instructions to dis-tween themselves, and being bound practimiss the bill. Reversed. Also

cally, at least, as principals to those who WRIT of Certiorari

Circuit Seventh Circuit to review a decree which re- The quotation of the prices continuously versed a decree of the Circuit Court for the offered and accepted in these pits during District of Indiana, dismissing a bill to en- business hours are collected at the plaintiff's join the distribution of market quotations expense, and handed to the telegraph compacollected by the Chicago board of trade, and nies, which have their instruments close at directed the entry of a decree granting the hand, and by the latter are sent to a great relief sought. Affirmed.

number of offices. The telegraph companies

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