volving collateral and extraneous matters with which they have no concern, such as the controversy between the complainant and the indemnitor banks." Collett v. Adams, 249 U. S. 545, 550, 39 S. Ct. 372, 63 L. Ed. 764. [2] The decisions of the Circuit Courts of Appeals and of the District Courts under the bankruptcy law as amended, as above stated, have with one accord followed the decisions of the Supreme Court last given. Those from this circuit only will be cited, in which it is made plain that the jurisdiction of the federal courts in bankruptcy is exclusive in the administration of the affairs of bankrupts, and that such courts may stay proceedings in a state court begun prior to proceedings in bankruptcy, and indeed stay the taking of any steps embarrassing to the equitable distribution of the estate of a bankrupt. New River Coal Land Co. v. Ruffner Bros., 165 F. 881, 886, 887, 91 C. C. A. 559; Bray v. U. S. Fidelity & Guaranty Co., 170 F. 689, 697, 698, 96 C. C. A. 9; Virginia Iron, Coal & Coke Co. v. Olcott, 197 F. 730, 117 C. C. A. 124; Bank of Andrews v. Gudger, 212 F. 49, 128 C. C. A. 505.

[3, 4] To prevent misapprehension, it should be stated that nothing in what has been said in any way questions the right of the state court to entertain the foreclosure suit, in spite of the fact that it was begun nearly two months after the filing of the petition in bankruptcy. The right of the mortgagees in it to enforce their lien was not affected by the fact that the title to one of the junior lienors arose out of an assignment of the bankrupt. It may also be admitted that when the state court in the foreclosure proceedings took possession of the mortgaged property, put it up for sale, and took the proceeds into its hands, it was by the ordinary rules of law bound to hear any one who claimed to be interested in them. If there were conflicting claims upon any part of the funds, it ordinarily had jurisdiction to pass upon them. and, without its consent, no court of merely concurrent jurisdiction could in any wise interfere. The question of whether Miss Bailey or the trustee in bankruptcy had the better claim to the third lien on the property in process of foreclosure was, however, altogether separable from every other question in the case. It was one which in its nature would ordinarily have been within the jurisdiction of the court of bankruptcy. Moreover, before the institution of the suit in the state court, the court of bankruptcy had begun its inquiry into some of the conveyances from the bankrupt to his daughter, and in addition had issued its injunction to prevent the

alienation of the property dealt with in them.

It is true that at the time the trustee supposed that all that was involved was some real estate in Georgia, but it subsequently turned out that there was a common purpose and intent running through these deeds and the assignment of the mortgage with which we are presently concerned. There can be no question that the investigation of all the circumstances could be made by a single court with greatest advantage to the cause of justice and the rights of the parties. The court of bankruptcy was the only one having jurisdiction sufficient for the purpose. No one would claim that the state court in a foreclosure suit could have attempted anything of the kind. There was therefore much of sound sense in the action of the circuit judge in South Carolina in turning over, as he did, the question of the relative rights of the trustee and Miss Bailey to the determination of the District Court of the United States.

It is to be noted that the order of the state court, in effect remitting the inquiry to the District Court of the United States, was apparently in full force and was not in any wise superseded until after the entry of the decree in the District Court of the United States.

It is true that in the United States court Miss Bailey asserted that the issue as between her and the trustee had, by the action of the state court become res adjudicata, a contention, however, to which it was impossible for the United States court to accede, for, as the matters stood at that time, the last thing the state court had done was to ask the United States court to pass upon the dispute. [5] We do not think that any liberality which South Carolina may show as to the time in which appeals may be taken justified Miss Bailey before going on with her appeal in waiting until she found out what the final decree of the court of bankruptcy would be. No one is entitled so to play fast and loose with the rights of others.

The right of the assignment to Dorothy Bailey was duly brought up and disposed of in the District Court of the United States, in the proceeding instituted by the bankrupt's trustee, to which answer was filed by her, and the trustee in bankruptcy insists that, having joined issue in that cause, instituted especially to test the validity of the assignment, and in which the testimony was fully taken, upon the rendition of the adverse decision to her, she was estopped and barred from reopening the same under the decision of the Supreme Court of South Carolina, rendered in the foreclosure proceeding afore

said, made long subsequent thereto, and the respondent further says that prosecution of the appeal in that case, after the delay, in the circumstances under which the same was taken, is not binding upon him, and that he is entitled to the full benefit of the decrees entered in his behalf in the federal District Court, vacating and annulling such assignment.

The court can but feel that the appellee is entitled to the relief asked, taking into account especially the fact that there appears to be no dispute that the assignment was wholly voluntary and made as a gift by the father to the daughter, at a time when the father was insolvent; that the proceeding is one in bankruptcy, in which, at the very threshold an injunction was sought and granted to prevent the estate involved from being disposed of or hypothecated or incumbered by either the bankrupt, his wife or his daughter. Following this injunction, upon appropriate proceedings in the United States District Court, much testimony was offered and a warm and bitter contest waged, resulting in a finding of facts by the special master and the District Court fully sustaining the appellee's contention, both in respect to the law and the facts in the case, and the assignment in question annulled. During all this time the injunction awarded remained in full force and effect and does to this day.

[6] Appellant insists that the appellee, the bankrupt's trustee, is not entitled to relief herein, and that the decree of the District Court, appealed from, should be reversed, because the trustee is estopped by reason of his appearance in the foreclosure suit in the state court and consenting to the decree of foreclosure, from further questioning the transfer of the mortgage bond in question thereunder from the bankrupt, C. T. Bailey, to his daughter, Dorothy Bailey. We are not prepared to give our assent to this proposition. It is true that the bankrupt's trustee, without previous permission had for the purpose, was made a party to the foreclosure suit subsequent to the bankruptcy, and he knew of that court's so doing, and appeared and filed a formal answer in the suit without permission of the bankruptcy court, and, while his answer was formal and shows that he was without information on the subject of the suit, nevertheless he consented to a decree directing the foreclosure asked. Subsequent thereto, however, and prior to the payment of the proceeds arising from the sale apparently coming to Dorothy Bailey, he, upon discovery of the facts, instituted this proceeding in the United States District

Court for the purpose of setting aside and annulling the assignment of the mortgage bond to appellant, Dorothy Bailey. This proceeding was instituted on the 11th of May, 1922, and on the 19th of May, 1922, the petition was brought to the attention of the state court in the foreclosure proceeding, with the request that the relief prayed for be afforded in that suit, or that opportunity be afforded to secure the same in the proceeding instituted in the United States District Court. On the 17th of June, 1922, Judge Townsend, in the state court, held that relief as to the fraudulent transfer of the bond to the daughter could not have been afforded in the foreclosure suit, and directed that the sum to be paid under the mortgage bond assigned be held by the officer of the state court until the validity of the transfer could be determined in this suit in the federal court brought for that purpose. Notice of appeal by appellant from the order of Judge Townsend was given, but the appeal was not prosecuted for some twenty months, and until the controversy in the federal court, after a bitter contest, had been decided in favor of the bankrupt's trustee, and this appeal therefrom had been taken. Under these circumstances, we do not consider the bankrupt's trustee estopped from making the contest, and are in accord with the ruling of the United States District Court deciding the same in his favor.

The proceedings in the state court were all started subsequent to the filing of the petition in bankruptcy (Fairbanks Shovel Co. v. Wills, 240 U. S. 649, 36 S. Ct. 466, 60 L. Ed. 841; Acme Harvester Co. v. Beekman Lumber Co., 222 U. S. 306, 307; 1 Everett v. Judson, 228 U. S. 478, 33 S. Ct. 568, 57 L. Ed. 927, 46 L. R. A. [N. S.] 154), and were had admittedly without opposition. To allow what was done by consent in this foreclosure proceeding to take precedence over a regularly contested litigation in the bankruptcy proceeding, affecting the ownership of an asset of a bankrupt estate, the title to which the trustee has indisputably shown to be vested in him, and not in the person to whom the same was awarded in that suit, would be clearly illegal, and in plain contravention of the intent and purpose of the bankruptcy law.

Respecting the prosecution of the state court appeal, as to whether the same was timely conducted, appellee cites the Code of South Carolina, 1922, vol. 1, § 646, subsec. 3, also sections 640 and 650; Rylee v. Marett, 121 S. C. 377, 378, 113 S. E. 483. We do not feel called upon to determine that question further than to say that the appeal was cer

132 S. Ct. 96, 56 L. Ed. 208.

Appeal from the District Court of the United States for the Southern District of New York.

Suit by the Lamson Company against G. & G. Atlas Systems, Inc., for infringement of patents Nos. 1,443,795, claims 5 and 6, and 1,396,449, claim 10, both for improvement in pneumatic dispatch systems and controls. Decree for defendant, and plaintiff appeals. Decree modified, and bill dismissed.

The following is the opinion of District Judge Augustus N. Hand, referred to for the facts, omitting the caption:

"This is a motion for a preliminary injunction to restrain the infringement of United States patent No. 968,576, issued August 30, 1910, to Charles Libby. A suit was brought by the same complainant against E. T. Slattery Company, in the Massachusetts District, and after a full trial and very care

ful opinion by Judge Morton, the defendant was held to infringe. The decree has just been affirmed by the Circuit Court of Appeals for the First circuit, and the defense in that litigation was conducted by the defendant here, who is the manufacturer of the alleged infringing device. While the decision in the First circuit is not technically res adjudicata, because the decree there is interlocutory, it is of the highest probative force, and should be followed unless clear reasons can be advanced for reaching a different conclusion.

"The only patent of any importance which is now produced that was not before Judge Morton is the Fordyce patent, No. 777,723. That patent, however, is for a closed and not an open system. The indispensable feature of the Libby patent was the maintenance of a continuous minimum flow of air. It is perfectly true that Libby accomplished this through a by-pass, while the defendant accomplished it through a partially closed valve. As the stipulation between the parties (Record p. 13) says: 'When there is no carrier in the line, the valve is left open just enough to permit the atmospheric air above the valve to leak by in response to the slight pull of the vacuum drum when the exhauster is running at its lowest speed.'

"Judge Morton held that defendant's partially closed valve was the mechanical equivalent of complainant's by-pass. To be sure, the first claim of the Libby patent speaks of 'a normally closed air valve located in said exhaust tube,' and the second claim a 'normally closed air valve controlling the flow of air through said exhaust tube.' Judge Morton held that defendant's valve was closed, within the meaning of claims 1 and 2 of the Libby patent, when it was sufficiently shut to stop the wasteful flow of air. He also held that the words of element in claim 1, 'a connection between said exhaust tube and said transit tube for normally permitting a minimum flow of air through said transit tube,' were met by the defendant's valve, which makes a connection between the exhaust tube and the transit tube. This he did because Libby first showed a 'tube valve pneumatically actuated by the introduction of a carrier adapted for use in' an open system, and added: "To this extent it is a pioneer patent.' I can see no reason for not adopting the ordinary rule of following a well-considered decision after final hearing in another circuit upon a motion for a preliminary injunction.

"The motion is granted; the amount of bond to be fixed upon settlement of the order."

Robert Cushman, of Boston, Mass., and Cooper, Kerr & Dunham, of New York City, for appellant.

reduced so low that it would no longer carry parcels. Literally, of course, the flow of air ceases to be "carrier-propelling" when it will

Before ROGERS, MANTON, and HAND, Circuit Judges.

HAND, Circuit Judge. [1] The opinion of the District Court states the facts with sufficient detail and to it we refer. In respect of No. 1,443,795, the critical question relates to the phrase, "a control device external to the conduit connection," which occurs in both claims. It is quite true that this reads literally upon the defendant's machine, but the two apparatuses are so totally unlike each other that to cover the defendant's machine the words must be understood so generally as to make the invention depend merely upon the idea of putting the stopping means outside the tube. Not only is the defendant's result arrived at by totally different means, but it is a different result, because Maclaren controlled his air by stopping his motor and wholly shutting off the current, while the defendant partially chokes the tube and lets the exhaust fan run on. This, as a method to economize power, was anticipated by Stoetzel. The defendant descends from that invention; Maclaren adopts an entirely different plan. Again, in means, the defendant went to Libby, and has been enjoined from doing so, and from Libby Maclaren took nothing.

It is, as we have often said, quite impossible to lay down any objective rules, and we should be unwilling to say unconditionally that it could under no conceivable circumstances have been an invention to put outside the tube the means by which the air flow is stopped or diminished. One may imagine that an art that showed a protracted groping for such a change and an immediate response to its discovery. That was not the case. There is not a tittle of evidence to show that this, or, for that matter, any other, feature of Maclaren's machine was ever welcome anywhere. Nor is there any reason to suppose that the location of the stopping means was other than the inevitable consequence of electrically controlling the flow of air by a "start and stop" system. We quite agree with the learned District Judge in saying that there was no invention in that.

If pressed dialectically by the words used, we should say that "means for stopping the carrier-propelling flow of air" may only mean that the flow of air was altogether stopped as Maclaren stopped it, and not merely

allowed the claim, and who had before him Maclaren's machine, was almost certainly not conscious of the pregnant ambiguity which is now used to cover devices wholly different in purpose and design. We see no reason to declare claims 5 and 6 of No. 1,443,795 invalid, but they certainly are not infringed. [2, 3] The infringement of claim 10 of No. 1,396,449 turns on the phrase, "operating means to control the pressure on said device to operate same and thereby move the valve." If the defendant's abandoned device (Fig. 2), the only one which can on any view infringe, is to be caught within this language, it must be because the element just described and that which follows coalesce, and are embodied in the parts 12 to 16 of the defendant's figure 2. Of course, it makes no difference that an infringer consolidates two features of the claim into a single part of his apparatus, and the question is whether both are in fact represented. The difficulty we find is that the "means to control the pressure" on the valve 121, so as to move it, is not the same kind of means as that which the defendant uses to move the valve, 21, which is its analogue. Maclaren had to start his air current by manual operation, because his whole system was normally inert. If a package was inserted, nothing automatically happened. It was only by opening the chamber, 125, to the atmosphere that he could establish a different pressure on the two sides of the diaphragm, 121, and this had to be done manually. This would have been as much the case, if it had been the valve, 157, which was manually operated, as it was with matters as they stood.

Had the valve, 117, been seated so as not wholly to close the pipe, we do not see how the defendant could escape infringement, but that would have eliminated all need for the valve, 135. The necessary changes are trifling enough, once one has determined to make that kind of machine; but that determination revolutionizes the whole plan of its operation, and incidentally makes useless the elaborate means of starting and stopping the motor. As the disclosure stands the claim does and must include the valve, 135, as a necessary element, since the apparatus would not work without it, and there can be no infringement unless the defendant uses some counterpart, which it does not. There is therefore no room for invoking the doctrine of equivalents.

Decree modified, by dismissing the bill for

ent.

ROGERS, Circuit Judge, through illness, was unable to take part in the decision of this

case.

the testimony the defendant moved for a directed verdict in its favor on the ground that there was no sufficient evidence of fraud in the execution or procurement of the release to warrant the submission of that question to

242

WHITNEY CO. JOHNSON.*

(Circuit Court of Appeals, Ninth Circuit. July 12, 1926. Rehearing Denied September 7, 1926.)

1. Trial 178.

No. 4815.

On motion for directed verdict, court must view testimony from standpoint most favorable to party against whom directed verdict is requested.

2. Action 24.

Under Act March 3, 1915 (Comp. St. §§ 1251a-1251c), proof of fraud inducing execution of release of liability for death is available in court of law.

3. Trial 4.

In absence of request therefor, it need not be determined whether parties were entitled to have equitable issue presented in law case first determined by court.

4. Release 58(6).

In action for wrongful death, evidence of fraud in procuring release of liability on payment of funeral expenses held insufficient for jury.

Gilbert, Circuit Judge, dissenting.

In Error to the District Court of the United States for the District of Oregon; Robert S. Bean, Judge.

Action by Ranghild Johnson against the Whitney Company. Judgment for plaintiff, and defendant brings error. Reversed and remanded for a new trial.

Simon, Gearin, Humphreys & Freed, Wilbur, Beckett, Howell & Oppenheimer, and Wilber Henderson, all of Portland, Or., for plaintiff in error.

B. A. Green and Louis V. Lundburg, both of Portland, Or., for defendant in er

ror.

'trial resulted in a verdict and judgment for the plaintiff. The case has been brought here by writ of error, and the denial of the motion for a directed verdict is the only question presented for our consideration. [1] As against such a motion the court must view the testimony from the standpoint most favorable to the defendant in error. Viewed in that light, her version of what transpired, and all that transpired, at and preceding the execution of the release, was the following: About five weeks after the death of her son, she wrote to the plaintiff in error, asking what it intended to do or would do in regard to the funeral expenses. In response to this letter an agent of the plaintiff in error called upon her at her home and asked for the bills. Having received them, he computed the amount and said: "We will pay that." The conversation at that time had reference to the funeral expenses only. The defendant in error at no time discussed her legal rights with the agent. She was informed by him, however, that she could recover nothing beyond the funeral expenses. About three hours after the first visit the agent returned, accompanied by a second party, to whom the defendant in error referred as a lawyer, but who was in fact another agent of the plaintiff in error and of an insurance company as well. The release was then presented to her and a copy to her husband, who was present. She was in a very nervous state. When she took the pen in her hand, she could not write and threw the pen aside. She was twice told to take her time, and the release was finally signed or executed by her. The agent did not read the release to her, and did not inform her of its contents; nor was the release read by her or by her husband. When the agent gave her the check, he stated

RUDKIN, Circuit Judge. This was an action to recover damages for death by wrongful act or neglect. The plaintiff in the action was the mother of the deceased; the defendant was his employer. One of the defenses interposed by answer was a release of the claim for damages, executed by the plaintiff. The validity of the release was challenged by reply because of fraud in its *Certiorari denied 47 S. Ct. --, 71 L. Ed.,

for the funeral expenses. Any finding of fraud in procuring the release must find its support in the foregoing testimony. [2] There is some discussion in the briefs whether the fraud relied on was fraud in the execution of the release, or in misrepresentation as to material facts inducing its execution, and whether proof of fraud of the latter kind is available in a court of law. Where the distinction between actions at law and suits in equity is still maintained, there