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thorough, but insists that if it shall find that it has made mistakes they cannot be corrected, because to do so would be an indirect mode of copying. Such a construction of the law would make the complainant's copyright a substantial monopoly, and by repeating annually the registration it could prevent everybody from using its directory for the purpose which is admitted to be lawful. Moffatt v. Gill, 86 Law Times Rep. 465, expresses the rule in directory cases which has been sanctioned by the Circuit Court of Appeals for the Second Circuit. It is true that it was obiter in both cases, but it is such a reasonable rule that I am bound to conclude that it will become the law of this circuit, if it has not formally become so already. The judge who wrote in Moffatt v. Gill plainly agreed with counsel that the cases relating to directories say that you cannot take another man's sheets and reprint them as your own, but you may take his sheets with you, and ascertain by personal investigation whether they are correct, and if you find that they are you may publish the result as your own. my opinion, the cases, both English and American, all come to this: You must not bodily transmit the results of another's labor from his sheets to your own; but, having made an honest canvass, you may use his work for the purpose of checking and revising your own, if you will do so honestly, independently, and thoroughly, and, having done so, you may publish the final result. If you use another's copyrighted directory without thorough verification, you are, to the extent that you fail to carefully verify, guilty of the pure, unadulterated labor-saving device of copying. If you use it only for comparison, and then positively verify at the cost of your own exertion, you have not done wrong, because you have only used the copyrighted matter as a guide to the facts, which is the exact use to which the compiler has dedicated his book.
Bearing this state of the law in mind, it behooves us to see how far the facts in this suit relieve the defendant from wrongdoing. Copied errors are, as many learned judges have said, one of the surest tests of copying. If we take from a published directory 1,000 cases in which names and addresses appear, and find that 990 of them are correct and 10 incorrect, and then look up the same 1,000 cases in the alleged infringing book, and find the same 990 correct as in the copyright and the same 10 incorrect as in the copyright, the rule of coincidences ought not to be invoked. There is only one way to account for such a number of errors. One is convinced that the compiler of the alleged infringement must have copied, a greater or less amount, as the case may have been, of the original matter. If the errors in the copyright had been made purposely, it would be immaterial. In the suit at bar, when defendant's witnesses testify that their work in the start was original, that by comparing they found many discrepancies, and that after verifying they O. K.'d the copied errors as well as the correct addresses, their entire testimony becomes tainted, and hardly worthy of serious consideration.
Defendant's "location of streets and avenues" is substantially a direct unverified copy from complainant's corresponding list. His list contains every name in complainant's list, but 59 of them represent catch names and nonexistent streets, which he could have discovered to be incorrect by simply glancing at his own map, which is confessedly
correct. Defendant's general directory, upon its own admissions, contains such a large number of copied errors as to destroy the force of its contention that it really verified the discrepancies. Defendant's directory of residents by streets, having been compiled from the general directory slips, is also not sustained by proof of real verification. The defendant, after full hearing on affidavits, was enjoined, pendente lite, by Judge Coxe from continuing the publication of its business directory, and no attempt has since been made to disprove infringement. The relief ought to apply to the entire publication, because the parts which are obviously copied are inextricably interwoven with the parts about which no positive proof of copying is presented, and the defendant has made no effort to separate the same. Probably, if it wished to do so, it could not.
It is not important at this stage of the case to discuss how much the complainant was damaged by the unfair use of the copyright. The use was obviously unfair, and a court of equity could not administer impartial justice without endeavoring to right the wrong.
As I approach the end, let me say that, for the reasons set down in the early part of this opinion, I do, in a certain way, sympathize with the defendant, even as I chide and punish. My notion of the complainant's rights under the copyright law does not, however, excuse the defendant for having indulged in what seems to me to have been a very perfunctory verification and uncertain original canvass. It will be remembered that defendant was not unwilling to be deprived of the services of such canvassers as returned a minimum of O. K.'d slips per diem. Rapidity in verification and speed in publication seem to have been defendant's business watchwords.
Defendant argues that the sale of its 1905 directory could not, in the nature of things, affect the sale of complainant's copyrighted 1904 directory. This may be so, but such sales were nevertheless injurious to the complainant, because defendant availed itself of the labor expended by complainant on the copyright, and has, by such unfair use, lessened its own labor, and since we cannot know how extensive the piracy was, it is only ordinarily fair that defendant should account to the complainant for any profits which it made.
The complainant, of course, cannot recover, under paragraph 7 of its complaint, for the injury to its 1905 directory, which was in preparation when the bill was filed, and I must treat those allegations as surplusage.
Looking upon the copyright, as I am bound to do if I follow other judges learned in the law, the complainant's property rights in the 1904 directory have been invaded by the defendant's acts. It is not perceived how defendant materially injured the sale of the 1904 directory, but it took advantage of complainant's work on the 1904 directory to compile its 1905 directory, and that device ought to be accounted for. The rights secured to the complainant by its copyright lost all substantial value after defendant had invaded them for the advantage of its 1905 directory. New directories are produced annually, and, of course, as soon as a 1906 directory is on the market, no one cares for that of 1905. That being so, injunctive relief at this late day would be of no avail.
The parties now stand in the precise situation which confronts litigants in patent causes when the patent has been held valid on the merits and infringed, but happens to have expired during the hearing. In such cases it is settled that a decree may be entered for an accounting, with costs.
Let that be done here, and let a master be appointed to assess the profits resulting from the sales of its 1905 directories which the defendant shall be found to have made.
IN RE HOOKS SMELTING CO.
(District Court, E. D. Pennsylvania. July 14, 1906.)
BANKRUPTCY-FAILURE TO OBEY ORDER TO TURN OVER MONEY-PENDING IN-
A motion to commit the treasurer of a bankrupt corporation for contempt for failure to obey an order of the referee requiring him to turn over money to the trustee will not be considered where he is under bail to appear and answer to indictments in the state courts for the embezzlement of such money from the corporation until after such indictments are disposed of.
In Bankruptcy. On certificate from referee.
See 138 Fed. 954.
Henry J. Scott, for trustee.
William H. Peace, for William S. Tryon.
HOLLAND, District Judge. In this case, William S. Tryon, treasurer of the bankrupt, was directed by the referee on April 25, 1905, to pay over to the trustee the sum of $35,019.12 within five days thereafter. Counsel has been delayed in every step taken in his behalf by reason of the fact that Tryon has paid no attention at all to the order of the referee and proceedings in this court. He does not even permit his own counsel to know his whereabouts, and counsel for the trustee has been unable to serve notice upon him. He cannot be found for the purpose of examination before the referee at all times, and his presence before the referee can be secured only through his counsel, and when he (Tryon) sees fit to attend. His defense has been technical, and he has at all times shown a disposition to avoid meeting the issues in the case, and having them disposed of on their merits. He is now under indictment in the local courts for embezzlement of the funds which he is said now to have in his possession and control. He is under bail to appear there and answer those charges. Without intimating any opinion as to the sufficiency of the evidence to sustain the referee's finding, the Court is of opinion that no order in this case should be made until Tryon is tried on the indictment in the state court. When this has been done, the motion here can be renewed.
Motion to commit for contempt is refused, with right of petitioner to renew motion at proper time, when such order will be made as the circumstances may warrant.
GUARDIAN TRUST CO. v. KANSAS CITY SOUTHERN RY. CO.
(Circuit Court of Appeals, Eighth Circuit. May 31, 1906.)
1. COURTS-FEDERAL COURTS-EQUITY PRACTICE-DEPENDENT SUIT MAINTAINABLE TO ENFORCE DECREE AND PROTECT TITLE THEREUNDER BY INJUNCTION. A federal court sitting in equity may by means of a dependent suit and by the use of injunctions or writs of assistance enforce its decrees and protect titles made thereunder against the re-litigation in state or other courts of issues it has determined and against the litigation of questions of which it has lawfully acquired and retained exclusive jurisdiction.
[Ed. Note.-For cases in point, see vol. 13, Cent. Dig. Courts, §§ 799, 801, 1355-1358.
Enjoining proceedings in state courts, see note to Garner v. Second Nat. Bank, 16 C. C. A. 90; Central Trust Co. v. Grantham, 27 C. C. A. 575; Copeland v. Bruning, 63 C. C. A. 437.]
2. SAME-DEPENDENT BILL-ACTION IN PERSONAM WILL NOT SUSTAIN.
The pendency in a state or other court of an action in personam which involves no issue of which the federal court has acquired exclusive jurisdiction, no claim to, or lien upon specific property in the possession or under the dominion of a federal court of equity, presents no ground to sustain a dependent bill to stay the action.
[Ed. Note.-For cases in point, see vol. 13, Cent. Dig. Courts, §§ 13551358, 1418-1430.]
3. MORTGAGES-FORECLOSURE-SUBJECT MORTGAGED PROPERTY, OBJECT APPLICATION OF THIS SPECIFIC PROPERTY TO MORTGAGE DEBT-PERSONAL LIABILITIES OTHERWISE IMMATERIAL.
The subject of a suit to foreclose a mortgage is the specific property mortgaged. Its object is the subjection of all liens thereon to that of the mortgage and the application of the specific property to the payment of the mortgage debt.
The personal liabilities of the parties and of the purchaser at the sale in such a suit are immaterial save as they condition the accomplishment of this object.
4. SAME FORECLOSURE-ACTION IN PERSONAM ON LIABILITY OF PURCHASER FOR MORTGAGOR'S DEBT UNDER REORGANIZATION SCHEME NO GROUND FOR DEPENDENT BILL OR INJUNCTION WHERE NOT LITIGATED IN FORECLOSURE SUIT.
An action against the purchaser at a foreclosure sale upon its alleged liability to pay a debt of the mortgagor founded on the execution of a plan of reorganization under which the purchaser was organized and pursuant to which it bought the property, is not an invasion of the exclusive jurisdiction of the court which rendered the decree, usually reserved, to determine the priority and superiority of other liens to the lien of the mortgage, nor an impeachment of the decree or of the title thereunder, in a case in which the question of the purchaser's liability for such a debt has not been litigated in the foreclosure suit. (Syllabus by the Court.)
Appeal from the Circuit Court of the United States for the Western District of Missouri.
Harry S. Mecartney (Jules C. Rosenberger, on the brief), for appellant.
S. W. Moore, for appellee.
Before SANBORN, HOOK, and ADAMS, Circuit Judges.
SANBORN, Circuit Judge. This is an appeal from an order which prohibited the defendant below, the Guardian Trust Company, from prosecuting two actions at law which it had instituted in the Circuit Court of Jackson County in the state of Missouri against the complainant, the Kansas City Southern Railway Company, to recover a personal judgment against the latter for about $500,000, which the Trust Company claimed that the Kansas City Suburban Belt Railroad Company originally owed it and the Southern Company had assumed and agreed to pay. These alleged facts are disclosed by the record: In 1899 the Kansas City, Pittsburgh & Gulf Railroad Company owned or controlled a line of railroad from Port Arthur in the State of Texas to Belt Junction in Jackson County in the State of Missouri, and the Belt Company owned a line of railroad from that point into Kansas City, so that the two companies controlled a continuous line of railroad from Port Arthur into Kansas City. The railroads of both companies were incumbered by mortgages under which receivers were appointed and foreclosure sales were made by direction of the court below. After a foreclosure suit had been commenced against the Gulf Company and in March, 1900, the Southern Company was incorporated to purchase the properties of the Gulf Company and the Belt Company, pursuant to a plan of reorganization, under which the stockholders of the Gulf Company received a share of stock in the Southern Company for $10 and one share of stock of the Gulf Company and the stockholders of the Belt Company received a share of stock of the Southern Company for each share of stock of the Belt Company, while the unsecured creditors of the latter company received nothing. Under this plan the committee of reorganization was authorized to agree to pay and to pay such unsecured debts of the Belt Company as it selected. At the foreclosure sale of the property of the Gulf Company in March, 1900, the committee caused that property to be purchased and conveyed to the Southern Company, which assumed the obligations of the committee. In September, 1900, four suits to foreclose mortgages upon the property of the Belt Company were commenced. Receivers were appointed, the suits were consolidated, a decree of foreclosure was rendered on November 6, 1900, a sale of the mortgaged property was made there under on January 31, 1901, and was confirmed on January 2, 1902, to the Southern Company. By means of the sale of bonds of the latter company secured upon the property derived from the Gulf Company and from the Belt Company and by the sale of the stock of the Southern Company the committee of reorganization raised and expended a large amount of money and after paying all their expenses turned over to the Southern Company an amount of money far in excess of the aggregate of the unsecured debts of the Belt Company. Each of the decrees of foreclosure contained the usual provisions that the purchaser should pay the costs of foreclosure, the receivers' liabilities and such claims as should be adjudged "prior in lien or superior in equity to the mortgage foreclosed herein upon the property sold," that the preferential character of such claims might be litigated in that suit before the master and the court in a manner therein prescribed, and that for the purpose of enforcing the provisions of the decree the court retained jurisdiction.