been. This new company became a licensee of the complainant, and recognized its legal ownership of the patent in controversy, and in terms admitted the novelty, utility, and validity of the same. Afterwards, in February, 1895, the Freeman Wire & Iron Company sold and transferred all its assets and property to the Consolidated Steel & Iron Company, and discontinued business. At that time the contract of August 19, 1888, was in the possession of the officers of the Freeman Wire & Iron Company, and was represented by them to be the property of the last-named company, and was used as a special inducement to bring about the purchase by the Consolidated Steel & Iron Company. The purchase was made by it, and this contract was delivered to the purchaser; and I do not doubt from the evidence that the delivery was intended by the parties to be a sufficient transfer of whatever valuable rights, if any, the said Freeman Wire & Iron Company had in said contract. A delivery of a contract with such intent is as effective to transfer rights thereunder as a formal assignment would be. The fact that the last-named company, by its officers, had it in its possession, that it was the successor to the original Freeman Wire Company, under the circumstances above detailed, creates a strong presumption that it became the owner, by delivery of the instrument, at the time the other assets were turned over to it, of any and all possible rights which the Freeman Wire Company ever had in and to the same.

Returning now to the Freeman Wire Company: After it transferred its assets and property to the Freeman Wire & Iron Company, it ceased to do business. It had no place of business. It had no assets, money, or property to do business with. It continued in this comatose state for about seven years, namely, until July, 1895, when, probably for the sole purpose of endeavoring to assert rights under this old contract, it took the legal steps required by the laws of the state of Missouri, under which it was incorporated, to reduce its capital from $60,000, as originally capitalized, to the nominal sum of $2,500, and after this was done it proceeded in a secret way to manufacture machines under plaintiff's patent, claiming the right so to do under the old contract of August 19, 1888. In my opinion, if this contract was not limited, with respect to the machines which defendants might demand of the Bates Machine Company or its successors, to the then known necessities of the parties, it was either transferred to the successors of the defendants, and thus ceased to be available as a protection now to the defendants, or was entirely abandoned and for naught held at or before the time of the first transfer to the Freeman Wire & Iron Company, and is now no justification whatever for the defendants' present claims.

The defendants further claim that under the bill of complaint the plaintiff is entitled to no preliminary injunction against the defendants, because no specific charge is made against them; that, on the contrary, the wrong and injury complained of are alleged to be done and threatened by the American Wire-Nail Company, a corporation doing business at Anderson, in the state of Indiana. While the bill is somewhat confused, and might be made more definite in this respect, it sufficiently appears, I think, that the defendants in this case v.71f.no.2-20

are charged at least with being the instruments in the hands of the American Wire-Nail Company in the infringement complained of. They are, by the averments of the bill, joint trespassers or tort fea sors with that company, and cannot complain that their associates in wrong are not joined with them.

Defendants next rely upon the facts set forth in a special plea filed herein. First, upon the provisions of the anti-trust laws of the state of Illinois, and allege that the complainant exists in violation of such laws, and is a party to an unlawful trust or agreement, within the meaning of such laws; and therefore ought not, in equity and good conscience, to be permitted to prosecute this suit. The proof on this plea is substantially this: The complainant is a corporation organized under the laws of the state of Illinois for the purpose of acquiring patents and granting licenses thereunder. It has become possessed of many, if not all, of the valuable patents for the manufacture of barbed wire and the machines for so doing, and has granted a large number of licenses to persons and corporations under its said patents. The evidence further shows that it has not bound its licensees to any prices, or in any manner limited or restricted their sales or output. The defendants rely, in support of their plea in this regard, upon the case of Harrow Co. v. Quick, 67 Fed. 131. In that case it appears that the complainant was organized for the purpose of acquiring the ownership of all patents held by different corporations and business firms in the United States which are engaged in the manufacture or sale of spring-tooth harrows, and to grant licenses to such corporations and firms to use the patents so acquired, on the payment by them of certain fixed royalties, and to fix and regulate the price at which such harrows shall be sold by its licensees. In the first place, it should be noticed that the facts in that case in regard to the purposes of the organization are different from the facts in the case at bar. In the case at bar it appears, without contradiction, that the complainant's licensees are in no manner restricted or controlled in respect to the prices they shall ask or get for wire manufactured under their licenses. In other words, there appears to be, so far as the complainant's licensees are concerned, unrestricted competition in the sale of their products. The above-mentioned case cannot, therefore, b treated as authority in determining the issue presented in this case on such a different state of facts. I would quite agree with the learned judge who wrote that opinion that the correctness of his conclusion, even in that case, was not free from doubt. I prefer, therefore, not to put my decision of this question on so narrow a ground as to recognize the authority of that case, and differentiate this from it. The entire theory and purpose of our patent laws is to create a limited monopoly. In consideration that a patentee will give his invention to the public, with full drawings and specifications, so as to enable the public to freely use it at the expiration of 17 years, a grant is made to him of an exclusive right to the monopoly of the patented article or device during that time. The rights so acquired by the patentee under a grant from the United States are entirely inconsistent with the patentee's being made subject to the provisions of the anti-trust laws of the several states. Under his grant he has

been given, and for the consideration already alluded to is entitled to maintain, a monopoly in the disposition or use of the patented article or device. This I understand to be the rule announced by the circuit court of appeals for the Second circuit in the case of Edison Electric Light Co. v. Sawyer-Man Electric Co., 3 C. C. A. 605, 53 Fed. 592. It has also been announced in circuit courts in the following cases: Strait v. Harrow Co., 51 Fed. 819; Soda-Fountain Co. v. Green, 69 Fed. 333.

The defendants again resist this application on the ground that the complainant has not complied with the foreign corporation law of the state of Missouri, by filing a copy of its charter, etc., with the secretary of state, before bringing this suit; and that, therefore, in accordance with the provisions of that law, it cannot maintain this action. It is sufficient to say, with regard to this contention, that whatever construction may be given to this law by the state courts in respect to suits coming within their exclusive jurisdiction, it cannot be made applicable to suits instituted in the federal courts without denying the jurisdiction conferred by congress upon such courts. Accordingly, this ground of opposition to the injunction cannot be sustained.

It results from the foregoing views, that the complainant's motion for a preliminary injunction should be sustained. By reason, however, of the fact that this application is heard on ex parte affidavits, and as the facts may appear differently when made subject to the scrutiny of cross-examination on final hearing, I think the complainant ought to be required to give a bond in the usual form, with satisfactory sureties, to secure the defendants from loss or damage in the event of a final dissolution of the injunction. This bond will be fixed in the sum of $10,000. Counsel may prepare the form of restraining order and bond, and submit them to the court.

PAIRPOINT MANUF'G CO. v. ELDRIDGE CO.

(Circuit Court, D. Connecticut. January 1, 1896.)
No. 775.

1. DESIGN PATENTS-INFRINGEMENT-NOTICE OF PATENT.

The owner of a design patent, who fails to mark "Patented" the articles sold by him, until after the design is copied by another, has the duty of alleging and the burden of proving that the latter was notified of the infringement, and continued the infringement thereafter. Dunlap v. Schofield, 14 Sup. Ct. 576, 152 U. S. 244, followed; Falk v. Engraving Co., 48 Fed. 262, distinguished.

2 SAME EVIDENCE OF NOTICE.

Testimony of a member of an association which controlled the price of certain manufactured articles, and of which complainant was also a member, that in visiting defendant's factory he noticed that an infrin ging article was being made there, and told defendant of complainant's patent, whereupon defendant said he knew the article was patented, held insufficient to show notice of the infringement, where the action of the witness was neither authorized nor ratified by complainant, and the conversation was denied by defendant.

are charged at least with being the instruments in the hand American Wire-Nail Company in the infringement compla They are, by the averments of the bill, joint trespassers or sors with that company, and cannot complain that their asso wrong are not joined with them.

Defendants next rely upon the facts set forth in a special herein. First, upon the provisions of the anti-trust laws of of Illinois, and allege that the complainant exists in violatio laws, and is a party to an unlawful trust or agreement, w meaning of such laws; and therefore ought not, in equity conscience, to be permitted to prosecute this suit. The pro plea is substantially this: The complainant is a corporation under the laws of the state of Illinois for the purpose of patents and granting licenses thereunder. It has become of many, if not all, of the valuable patents for the manu barbed wire and the machines for so doing, and has grant number of licenses to persons and corporations under its sa The evidence further shows that it has not bound its licen prices, or in any manner limited or restricted their sales The defendants rely, in support of their plea in this regar case of Harrow Co. v. Quick, 67 Fed. 131. In that case it a the complainant was organized for the purpose of ac ownership of all patents held by different corporations a firms in the United States which are engaged in the mar sale of spring-tooth harrows, and to grant licenses to s tions and firms to use the patents so acquired, on the them of certain fixed royalties, and to fix and regulate which such harrows shall be sold by its licensees. In th it should be noticed that the facts in that case in regar poses of the organization are different from the facts in bar. In the case at bar it appears, without contradict complainant's licensees are in no manner restricted or respect to the prices they shall ask or get for wire 1 under their licenses. In other words, there appears to the complainant's licensees are concerned, unrestricted ‹ the sale of their products. The above-mentioned case fore, b treated as authority in determining the issue this case on such a different state of facts. I would qu the learned judge who wrote that opinion that the cor conclusion, even in that case, was not free from do therefore, not to put my decision of this question o ground as to recognize the authority of that case, an this from it. The entire theory and purpose of our to create a limited monopoly. In consideration that give his invention to the public, with full drawings an so as to enable the public to freely use it at the expira a grant is made to him of an exclusive right to the n patented article or device during that time. The rig by the patentee under a grant from the United Sta inconsistent with the patentee's being made subject t of the anti-trust laws of the several states. Under