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market with his full quota of free sugar. Home refiner A. becomes willing to pay refiner B. a certain required sum if he will export a portion of his allotted quota of sugar, and he accordingly gives A. the official evidence of such exportation in the form of a voucher or certificate, as above described; and this, under the operation of the Russian law and regulations, authorizes A. to sell in the home market, at a tax of 1.75 rubles per pood, an equivalent portion of the sugar produced by him (A.) in excess of his quota. One of the purposes of these transfers is expressly stated to be in order to facilitate the exportation of the surplus to foreign countries.' Sections 39, 40. "The character and value of these certificates are further explained in the following extracts from the stipulated agreement of facts in this case:

"(VI.) That, upon the exportation of said sugar from Russia, the Russian government, under its laws and regulations, released said sugar from said tax of 1.75 rubles, either by a refund of the tax, or a cancellation of indebtedness, or otherwise.

"(VII.) That, in addition to remitting said excise tax, the government issued to the exporter a certificate certifying that he had exported such a quantity of so-called free sugar. The said certificate and such certificates for free sugar have a substantial market value, and are transferable, and the price thereof is usually determined by the difference existing at the time between the price obtainable for the sugar on the home market and the price obtainable abroad.

""(VIII.) That said certificates are sold to and used by sugar manufacturers or refiners, who are thereby enabled to transfer from their "free reserve or free surplus" to their "free sugar" an amount of sugar equal to the amount shown by said certificates to have been exported, which amount may then be sold for domestic consumption on paying the ordinary tax of 1.75 rubles per pood (to which free sugar is regularly subject).'

"The following statement on this subject is made in the report of the American consul to the treasury department, and which was admitted in evidence at the hearing:

"On shipment abroad of sugar which cannot be placed on the home market without the payment of additional excise, the latter-i. e., the excise is guarantied by approved securities, and for this sugar a certificate is given to the effect that the same has been manufactured at such a factory in such a year and figures in the category of "free reserve," and is being sent abroad through such custom house. When thereafter this sugar arrives at the custom house and has been shipped abroad, the customs authorities make an indorsement on the certificate and also issue to the shipper quittances, which are accepted in lieu of payment of the excise computed as being due on that sugar. The manufacturer presents this certificate to the local excise administration, which sets the securities free which were deposited when the sugar was being removed from the factory. To avoid the necessity of giving securities as guaranty for additional excise, and, in general, for the greater freedom in business transactions, the manufacturer is granted the right to export abroad "free sugar,"-i. e., that on which no additional excise is payable. For such sugar, on its being taken from the factory, a certificate is given, on which is written "Free Sugar." When thereafter the sugar is exported abroad, and an indorsement is made on the customs certificate, then, on presentation of this certificate to the local excise inspection, the latter transfers to the "free sugar” an equal quantity from the "free reserve." It is, of course, understood that on the exportation abroad of free sugar the customs authorities also issue quittances, which are valid in lieu of payment of excise on sugar. It is permitted to export free sugar abroad, not only for the purpose of liberating for admission t the home market the "free reserve" of any one factory, but also of any other factory. For this purpose the owners of the fact ries who enter among themselves into such an agreement must notify their local excise officials, and these in turn must notify each other. That factory which desires to export abroad its free sugar, say 5,000 poods, for the account of another factory indicated by it, asks for the transfer in its factory and

excise books of 5,000 poods from the category of "free sugar" to the category of "free reserve" in order that from the category of the "free reserve" of the other manufacturer 5,000 poods may also be transferred to the category of "free sugar." The other manufacturer hands in a notice for the liberation of 5,000 poods of the free reserve from the additional excise and its transfer to the category of free sugar, in view of the fact that in its place 5,000 poods of the free sugar have been transferred to the free reserve of the first manufacturer. Consequently the first manufacturer ceded to the second his right of placing on the home market 5,000 poods, which he can now only sell abroad or pass out into the home market after payment over and above the excise of the additional excise of 1.75 rubles per pood. As the first and second methods of disposing of this sugar are less advantageous than placing the article on the home market as free sugar, the manufacturer who ceded his right receives from the manufacturer who acquired the right the price per pood agreed upon between them, which is usually determined by the difference existing at the moment between the price obtainable for the sugar and on the home market and the price obtainable by sale abroad. This is what is termed a "transfer." Dependent up n the fluctuations in price of sand sugar in Russia and abroad, the price of these transfers also varies. Therefore, the person who sells the transfer (the right of issue into the home market) charges several kopecks more than the difference mentioned above. This is done on account of the risk that is taken that sugar prices abroad may fall, and also for the trouble involved in exporting, etc. Example: Price of sand sugar at a station in the southwestern region: (a) For the home market, Rs. 4.25 per pood, or, without excise, Rs. 2.50; (b) for abroad, Rs. 1.25. Consequently the difference or value of transfer is Rs. 1.25; but in that case, for the reasons given, Rs. 1.28 to Rs. 1.30 is paid for the transfer. * # For example, four sugar factories far away from the shipping port have to export 50,000 poods each, or in all 200,000 poods. Another factory situated near a shipping port, to which the freight is cheaper, and with the demand for sugar not great, finds it more profitable to export its entire output (250,000 poads), and receives export certificates for this quantity. These certificates are given to the owners of the four factories mentioned, and these in turn deliver 200,000 poods of sugar, which can be sold on the home market whenever the owner pleases. It should have been stated that certificates to the extent of 200,000 poods are exchanged for the same quantity of sugar, and not 250,000 poods. These certificates can be sold to a bank, or to a speculator who has engaged to deliver sugar at the port abroad to which the sugar was shipped. The government also takes these certificates in payment of excise at par; i. e., 1 ruble 75 kopecks a pod.'

"The natural result of the Russian laws governing the sugar industry is the accumulation of a large surplus of sugar, and the disposal of such surplus has proved a problem of no small difficulty. Much of it has necessarily gone abroad for export, even at a 1 ss to the manufacturers. It is manifest from the foregoing considerations that the exporter of sugar from the Russian empire, under the provisions of the Russian laws already mentioned, as enforced by the regulations of the minister of finance, receives a valuable bonus through the operation of such laws and regulations, and that this bonus accrues to him upon the exportation of his sugar. The export certificates or vouchers, to which we have referred, are only the legal evidence of this valuable privilege or grant conferred by the government, without whose authority such transfers of sugar would be valueless and of no effect. Our conclusion, therefore, is that a bounty or grant, within the meaning of section 5 of our tariff act, has been paid or bestowed by the Russian government upon the exportati n of this sugar, so as to work a benefit or advantage to the Russian sugar exporter, as follows: First. Upon the exportation of the sugar, the government remitted or refunded the excise tax due thereon, or otherwise canceled the indebtedness of the sugar manufacturer, so that he was enabled to place his product upon the market free from the burden of either the regular or additional excise tax. Second, The certificate which the government issued to him upon the exportation

of his sugar had a substantial market value, and was transferable, and operated as a premium, grant, bonus, or reward. Looked at from the Russian standpoint, these advantages might, perhaps, be described as a bounty on production; but (in the language of the circuit court of appeals in the Hills Bros. Co. Case, supra), 'from the standpoint of other countries,' they become a bounty or grant on exportation. It will be observed, too, that in the Hills Bros. Co. Case it was the fact alone of the remission of the excise tax by the Dutch government which brought into operation the bounty received by the sugar makers. In other words, it created it; for without such remission there would have been no bounty. It is immaterial, we may add, whether the price obtained for the exported sugar reaped a profit or inflicted a loss upon the manufacturer or producer. The simple inquiry is whether, at whatever price he may have sold it, he received a bounty or grant of pecuniary value, upon its exportation by reason of and through the operation of the system of laws of the Russian empire designed for the regulation of the sugar industry, both for home consumption and exportation.

"There is nothing in the decision of the circuit court of appeals in the case of U. S. v. Hills Bros. Co., supra, which, in our judgment, conflicts in any manner with the conclusions we have reached in this case. On the contrary, the reasoning of the court is strongly confirmatory of the views we have expressed. That decision, it may be noted, reversed the decision of the circuit court holding that the bounty paid by Holland was a bounty on production (99 Fed. 425), and affirmed the decision of this board, which held it to be a bounty on exportation. In re Hills Bros. Co., G. A., 4261. In examining the mass of evidence introduced in this case, and in constru ing the Russian laws and regulations, we have borne carefully in mind the principle laid down by Mr. Justice Miller in Henderson v. Mayor, 92 U. S. 259, 268, 23 L. Ed. 543, 547, that 'in whatever language a statute may be framed, its purpose must be determined by its natural and reasonable effect.' "Testing the Russian sugar laws by this standard, and giving to the importer the benefit of every reasonable doubt as to the construction of the law, we are impelled to the conclusion that the Russian sugar statutes and regulations operate to pay or bestow a bounty or grant, directly or indirectly, upon the exportation of sugar. The protest is overruled, and the decision of the collector is affirmed."

The decree appealed from is affirmed.

(113 Fed. 162.)

STANDARD CASTER & WHEEL CO. v. CASTER SOCKET CO., Limited.

(Circuit Court of Appeals, Sixth Circuit. December 17, 1901.)

No. 1,016.

1. PATENTS-INVENTION-ADAPTING DEVICE TO NEW USE.

The transfer of a device from one art to another does not amount to invention where it performs the same function in both without any change of form to adapt it to the new use.

2. SAME-MAKING SEPARATE PARTS IN SINGLE PIECE.

The mere making in one piece of a device formerly made in two parts mechanically attached is not invention, and the exception to the general rule must depend upon special facts indicating the presence of the inventive faculty in a degree greater than the mere mechanical knowledge required by so simple an improvement.

3. SAME FURNITURE CASTERS.

The Berkey patent, No. 318,533, for a caster socket provided with an Interior spring made integral with one side of the socket and from the same material, the purpose of which is to press against the bulbous head of the caster shank, and prevent it from dropping out when the furniture is raised from the floor, was anticipated by the Kane & Brown patent of 1866, which showed the same spring, except that it was made of a separate piece of metal, and mechanically attached to the socket. 4. SAME EVIDENCE OF INVENTION-EXTENSIVE USE.

It is only when the patentability of a device is doubtful that its general use may turn the scale.

5. SAME-INFRINGEMENT.

Infringement cannot ordinarily be escaped by merely cutting in two a device made in one piece, or by making integral an article formerly made in two; but to render such change a defense to the charge of infringement special facts must appear to show that it is not merely colorable.

6. SAME-FURNITURE CASTERS.

The Berkey & Fox patent, No. 345,613, as to claims 3, 4, 5, and 6, covering a track plate for furniture casters, though narrow, was not anticipated, shows invention, and is valid. Also held infringed.

Appeal from the Circuit Court of the United States for the Western District of Michigan.

Willard Parker Butler, for appellant.

Arthur Denison, for appellee.

Before LURTON, DAY, and SEVERENS, Circuit Judges.

LURTON, Circuit Judge. This is an appeal from a decree sustaining two patents as valid and finding infringement. Both patents belong to the appellee, the Caster Socket Company, and both relate to improvements in furniture casters. The first patent involved was issued May 6, 1885, to Julius Berkey, and is numbered 318,533; the second is dated July 13, 1886, is numbered 345,613, and was issued to Julius Berkey and Wm. R. Fox.

1. The Berkey patent is for an improved socket for receiving the shank of a furniture caster, said socket being provided with a spring made integral with one side of the socket, and from same material. The object of this integral tongue or spring is to hold the caster in place so that it will not drop out when the furniture is lifted

from the floor, but not so firmly but that it is readily removed and inserted. The socket is described as made in two parts, which when in use are put together, thus forming a socket, which may be driven into the opening provided for it. To better understand the device, we insert below certain drawings from the specifications:

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Fig. 2 of the drawing is a plan view of the half socket, "A,” and Fig. 3 is a sectional view of the same on the line X-X of Fig. 2. Fig. 5 is a plan view of the half of the socket without the spring tongue, provided with a ridge for holding the ball of the caster shank. Fig. 6 is a sectional view of the same half socket on line Y-Y of Fig. 5. Fig. 7 is a sectional view of the entire socket in position in the furniture with caster in place. The only claim of the patent is in these words:

"In a caster socket, the half socket. A, provided with a tongue, a, integral with and formed of a part of the half s cket, A, substantially as and for the purposes described."

The prior art shows many forms of what are known as "hold-up casters." The patent to Kane & Brown of February 6, 1866, is beyond all question an anticipation, unless the fact that Berkey's spring is made integral with one-half of his socket constitutes a patentable improvement. The Kane & Brown patent was for a socket made in two parts, each half containing a curved, flat spring "riveted in the inside," as described in the specifications. This

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