That the depression or groove in the socalled special polished point cones is at the

"1. As a new article of manufacture, a yarn winding in which in each layer certain portions of the yarn are below the general level of the layer, the lowered portions affording a depression within which knots are placed.

"2. As a new article of manufacture, a yarn winding having layers in which certain sections of the yarn are below the general level of the layer, the lowered sections affording a depression within which knots are placed.

"3. As a new article of manufacture, a grooved winding of yarn with the knots located in the groove.

"4. As a new article of manufacture, a cone of yarn having a groove within which the knots are confined.

"5. As a new article of manufacture, a cone of yarn having a groove at right angles to its axis and intermediate its ends, the knots in the yarn being confined in the groove. "6. The method of winding yarn on a core which consists in bearing with a tool against the core during the winding of the yarn thereon to produce a groove in each layer of yarn, and placing the knots by which yarn ends are fastened together within the confines of said groove."

The patent in suit is not a pioneer patent, but is a great improvement, and marks a distinct advance in the art, and as such is entitled to a range of equivalents sufficient to protect the great advance in the art made by the patentee. To say that what the patentee did was what any skilled workman could have done can be sufficiently answered by calling attention to the fact that, notwithstanding cones with grooves were known, and the troubles with knots were great, yet no one for 20 years had been able to solve the problem until the plaintiff invented the product and method of the patent in suit.

However simple it may seem to us now, the knot problem was not solved for 20 years. The patent in suit is valid. The additions made to the winding machine used by the defendant were made by Mr. Napp, who also had made the so-called special polished point cones used by the defendant, but these were not the result of his independent labors in an effort to solve the knot problem. All that Mr. Napp did was done after the invention of the patentee of the patent in suit had been shown to him and he realized that it was a good thing.

of the patent in suit, does not, in my opinion, relieve the defendant of infringement, because, as I read the patent in suit, the width of the groove is not fixed, and the groove may as well be located at the top as at any other point. The fact that knots were placed at the top, in the prior art, did not teach that knots could be prevented from occasioning loss and annoyance by placing them in a groove or depression at that point.

Keeping in view the invention of the patent in suit, which was the placing of the knots in the groove, no suggestion of which can be found in the prior art, I do not see how the defendant can escape being found to infringe claims 1 to 5 of the patent in suit, for the product. The most that defendant could claim, if he could make any claim of invention of the so-called special polished point cone, would be that it was a mere improvement; but that would not relieve him from infringement, because the use of such cone would be valueless without employing the invention of the patent in suit, by placing the knots in the depression.

The contention of the defendant that the patent in suit is invalid, because the patentee did not speak of tension in combination with the bearing tool, and that plaintiff has abandoned the patent, and that the same is inoperative, in my opinion finds no support in the evidence. On the contrary, the highest tribute to the patent in suit has been paid by the defendant, because imitation is the sincerest form of flattery.

Prior to 1926, defendant was selling only "straight side" cones, and now about 60 per cent. of his output have the depression. Call it what you will, a groove or a depression, that which was found on defendant's cones is what was invented by the patentee of the patent in suit, and it is only begging the question for the defendant to contend that it can escape infringement simply because some of its employees, through lack of skill, fail to utilize the groove or depression as a place for placing as many knots as possible.

The patent in suit neither says nor intimates in the specification or claims that all knots will go into the depression or groove, but only that the ones caught by the operator shall be so placed. The groove or depression is created in defendant's cones for the purpose of caring for the knots in the manner pointed out in the patent in suit, and the product produced is the invention of the patent in suit. This clearly appears from de

Defendant contends that the depression, as he terms it, in the cones wound by him, is not intermediate its ends. This contention cannot, in my opinion, be sustained, because, as I see it, the groove or depression in defendant's product is intermediate its ends. But, if the contention could be sustained, it would not relieve the defendant from infringement of claims 1, 2, 3, and 4, because that limitation is found only in claim 5. All the product claims 1, 2, 3, 4, and 5 are infringed.

The chief accomplishment sought by the patentee was the product, the method of producing it being secondary, because the pat entee in the patent in suit said: "However, it will be obvious to those skilled in the art that various other methods may be adopted without departing from the spirit of the present invention." The product claims are for a product which was new, independent of the process, and had definite characteristics by which it might be identified.

[1, 2] Even if it should be held that the method is not infringed by the defendant, yet the claims on the product are infringed by the defendant's product, notwithstanding it may have been made by a different process from that disclosed in the patent. Rubber Co. v. Goodyear, 9 Wall. 788, 796, 19 L. Ed. 566; Merrill v. Yeomans, 94 U. S. 568, 571, 24 L. Ed. 235; Matheson v. Campbell (C. C. A.) 78 F. 910, 917; General Electric Co. v. LacoPhilips Co. (C. C. A.) 233 F. 96. As I have held, the patent is valid both for the product and the method.

Defendant employs a winding machine manufactured by the Universal Winding Company, of Boston, Mass., and although there is a button guide on such machine, which travels back and forth and touches the yarn or silk, as wound on the cone, this would not produce the groove or depression in the winding, and would not infringe, except for the fact that the defendant has placed on that machine a small plate, fastened to the frameback, the thickness of which plate is equal to the depth of the desired

groove.

When the guide, traveling back and forth on the frameback, reaches the plate—that is, when the guide is opposite the place where the groove or reduced end is to be producedit is forced forward by coming into contact with the plate, and presses against the yarn

The defendant's machine is different in form from that of the preferred machine of the patent in suit, which discloses a pointer 4 which is pressed toward the cone while the yarn is being wound thereon, and maintains the groove or depression, but it does not seem to me that the defendant can thereby escape infringement.

The method described in claim 6 "consists in bearing with a tool against the core during the winding of the yarn thereon to produce a groove in each layer of yarn. This, it seems to me, is the method employed by the defendant, because it is by the placing of the plate on the frameback of his machine that the depression or groove on the cone is produced in winding, by bearing with the button guide (a tool) against the core.

In any event, it would require but a very limited application of the doctrine of equivalents to hold that the button guide, when forced forward by the plate to form the groove or depression, is the equivalent of the pointer 4 of the patent in suit, and claim 6 is infringed. The patent in suit is valid and infringed.

A decree may be entered in favor of the plaintiff against the defendant, as prayed for in the bill of complaint, with costs and the usual order of reference. Settle decree on notice.

Louis MALINA, Plaintiff-Appellee, v. Reuben GRISMAN, Defendant-Appellant.

Circuit Court of Appeals, Second Circuit. June 16, 1927.

No. 378.

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

Lhowe & Obstfeld, of New York City (Edwin L. Garvin, Edward L. Evarts, and Harold R. Lhowe, all of New York City, of counsel), for appellant.

Paul Kolisch, of New York City (Fred A. Klein, of New York City, of counsel), for appellee.

Before MANTON, SWAN, and AUGUSTUS N. HAND, Circuit Judges.

PER CURIAM. Decree (20 F.[2d] 406) affirmed, with costs.

In re THOMAS-DAGGETT CO.

Petition of MARTIN. District Court, W. D. Michigan, S. D. January 10, 1927.

1. Bankruptcy 184 (2)-Chattel mortgages 6-Sprinkler equipment sale held absolute sale with chattel mortgage back, void against trustee for failure to file.

Contract evidencing sale of automatic sprinkler equipment prior to bankruptcy of buyer, reserving to vendor remedy for balance of purchase price and lien against real estate, held to result in absolute sale with security in nature of chattel mortgage, and void as against trustee in bankruptcy for failure to observe state laws relative to filing chattel mortgages. 2. Chattel mortgages 6-Contract by vendor seeking to secure secret lien should be clear, and such agreement should be construed against vendors' right to assert lien. As respects construction as chattel mortgage or conditional sale contract, if vendors intend to enjoy protection of their secret lien as against innocent purchasers and creditors, contract should speak so clearly that it is removed from field of doubt, and such agreement should be construed most strongly against right

of vendor to assert his claimed lien.

3. Chattel mortgages 6-Contract reserving secret lien should not be construed as conditional sale contract, unless intention and rights and remedies are clearly consistent therewith.

In absence of a specific reservation of title,

contract seeking to secure protection of secret lien should not be construed as a conditional sale contract, unless intention of parties as expressed, and rights and remedies therein provided, are clearly consistent with such construction.

In Bankruptcy. In the matter of the bankruptcy of the Thomas-Daggett Company. On petition to review an order of the referee denying the petition of Charles W. Martin to reclaim automatic sprinkler equipment installed in buildings belonging to bankrupt. Order affirmed.

Laurence W. Smith and Fred N. Searl, both of Grand Rapids, Mich., for petitioner. Clapperton & Owen, of Grand Rapids, Mich., for trustee.

Travis, Merrick, Warner & Johnson, of Grand Rapids, Mich., for Grand Rapids

Trust Co.

RAYMOND, District Judge. This matter is before the court upon petition to review an order of the referee in bankruptcy, denying the petition of Charles W. Martin to reclaim automatic sprinkler equipment installed prior to bankruptcy in buildings belonging to bankrupt by Hugh W. Clayton under an agreement which petitioner avers is a title

retaining contract. Shortly after the date of the contract it was assigned by Hugh W. Clayton to the petitioner. The question presented is whether the contract is one of conditional sale, reserving the title in the vendor until payment of the purchase price, or one of absolute sale, with security in the nature of a chattel mortgage. It is conceded that, if it is the latter, its provisions relative to retaking possession of the property by the vendor upon nonpayment of the agreed price are without validity as against the trustee in bankruptcy, for the reason that the laws of Michigan pertaining to the filing of chattel mortgages were not observed.

The question here involved is one which frequently has been before the state and federal courts, and the varying tests which have been from time to time suggested by the courts, coupled with the ingenuity of those who have so framed their contracts that the ascertainment of the real intention of the parties is a matter of great difficulty, has resulted in some confusion. The reservation of inconsistent rights and remedies, and the apparent intentional omission of apt words to make clear the real purpose of parties to agreements of this nature, have become common. The contract here under consideration is an example of the omission of the important and usual provisions in such contracts. It contains no agreement either to purchase or to sell presently or at a future time. It contains no statement which can be clearly construed as a reservation of title. There is no agreement to transfer title when the property is fully paid for. Omission of these fundamental provisions in an agreement which, in other particulars, appears to have been prepared with scrupulous care, is important in ascertaining. its legal effect.

The salient terms of the contract, which bears date April 14, 1924, were as follows: have installed in buildings of the ThomasThe vendor, Hugh W. Clayton, agreed to Daggett Company a sprinkler equipment and to furnish all labor and materials therefor, the Thomas-Daggett Company agreeing to pay to the vendor the sum of $22,700 in five annual payments. The conspicuous provisions which bear upon the question involved are as fo'lows:

"(8) That, in case the property is damaged or destroyed by fire, there shall be paid to the party of the first part, or to his assigns, at his or their option, out of the proceeds of the insurance by the insurance companies, all amounts due or to become due hereunder to the party of the first part, whether then evi