author: PHILLIPS, Chief Judge.

text:
    The AKRON PRESFORM MOLD COMPANY, Plaintiff-Appellant, v. McNEIL CORPORATION and Sun Corporation, Defendants-Appellees. The AKRON PRESFORM MOLD COMPANY, Plaintiff-Appellant, v. The B. F. GOODRICH COMPANY and Sun Corporation, Defendants-Appellees. The AKRON PRESFORM MOLD COMPANY, Plaintiff-Appellant, v. The B. F. GOODRICH COMPANY et al., Defendants-Appellees.
    Nos. 73-1555 to 73-1557.
    United States Court of Appeals, Sixth Circuit.
    Submitted on Brief without Oral Argument Jan. 31, 1974.
    Decided April 11, 1974.

      Albert L. Ely, Jr., Ely, Golrick & Flynn, Cleveland, Ohio, on brief, for plaintiff-appellant.
    Phillip L. Kenner, Hamilton, Renner & Kenner, and Richard E. Guster, Roetzel & Andress, Akron, Ohio, on brief, for McNeil Corp.
    James C. Davis, Squire, Sanders & Dempsey, Cleveland, Ohio, on brief, for The B. F. Goodrich Co.
    Everett R. Hamilton, Edward G. Greive, Hamilton, Renner & Kenner, Akron, Ohio, on brief, for Sun Corp.
    Before PHILLIPS, Chief Judge, MILLER, Circuit Judge, and Mc-ALLISTER, Senior Circuit Judge.
   PHILLIPS, Chief Judge.

The Akron Presform Mold Company (Presform) appeals from orders of District Judge Thomas D. Lambros granting summary judgment against it in its three actions for damages and injunctive relief under the antitrust laws. We affirm.

Presform, formerly a manufacturer of rotational casting machinery, filed complaints on July 3, 1968, alleging three different and unlawful conspiracies in restraint of trade and monopolization of the relevant market for rotationally casting plastics. Before presenting the factual allegations in each action, it is necessary to detail certain historical background in this extended controversy among the litigants.

Historical Background

This court in National Latex Products Co. v. Sun Rubber Co., 274 F.2d 224 (6th Cir. 1959), rehearing denied, 274 F.2d 224 (6th Cir. 1960), motion to reconsider in banc and second petition for rehearing denied, 276 F.2d 167 (6th Cir. 1960), cert denied, 362 U.S. 989, 80 S.Ct. 1078, 4 L.Ed.2d 21 (1960), held inter alia, that Presform had not infringed the Martin machine patent, U.S. Patent No. 2,629,131, owned by Sun Rubber Co. (Sun).

This court further held that Presform had contributorily infringed Sun’s Molitor process patent, U.S. Patent No. 2,629,134, for rotationally casting vinyl plastisols. 274 F.2d at 244-245. Thereafter, in 1960, we issued an injunction restraining Presform from “manufacturing and selling machinery intended or adapted to be used in practicing the method as claimed in said Molitor patent.” That case was dismissed later as a result of a settlement reached between the parties.

Subsequently, in a separate action, Barr Rubber Products Co. v. Sun Rubber Co., 277 F.Supp. 484 (1967), the Southern District Court of New York held, inter alia, that the Molitor patent was invalid. The primary reason stated by the District Court for so holding was that the record in that case, as well as in National Latex Products heard by our court, was blighted by Sun’s “extensive pattern of fraud,” “perjury in significant respects,” and “deliberately organized fabrication” with respect to the procurement and maintenance of the Molitor patent. 277 F.Supp. at 498-503. The Court of Appeals for the Second Circuit later reversed the findings of the New York District Court relating to “fraud” and “perjury” as clearly erroneous and reversed the holding of invalidity of the Molitor patent. The case was remanded to the District Court for new trial solely on the issue of patentability. Barr Rubber Products Co. v. Sun Rubber Co., 425 F.2d 1114, cert. denied, 400 U.S. 878, 91 S.Ct. 118, 27 L.Ed.2d 115 (1970).

Subsequent to the decision of the United States District Court for the Southern District of New York but prior to the Second Circuit’s reversal of the District Court’s findings of fraud and perjury in the procurement and maintenance of the Molitor patent, Pres-form instituted the present actions and filed a motion with this court seeking to reopen our disposition in National Latex Products, supra, decided some nine years earlier. Due to the pendency of the appeal in Barr Rubber Products, supra, to the Second Circuit, we stayed proceedings on the motion. After the Second Circuit announced its decision, we denied Presform’s motion on the ground of res judicata. Presform’s subsequent petition for rehearing on its motion was also denied.

Factual Allegations in the Three Actions

In Civil Action C68-487 (Appeal No. 73-1555), Presform alleged that McNeil corporation (McNeil), using Sun Corporation (Sun) as its front, unlawfully effected a substantial lessening of competition and tended to create a monopoly in the rotational casting of thermoplastic material market. Presform asserted that McNeil and Sun engaged in three monopolistic activities injurious to Pres-form: 1) enforcing the injunction fraudulently obtained from our court in 1960 in regard to the Molitor patent, 2) enforcing the injunction while knowing, but not disclosing to our court, that a substantial non-infringing use existed for Presform’s machine, and 3) imposing unlawful conditions to the obtaining of a license under the Molitor patent and to the purchase of their rotational casting machinery.

In Civil Action C68-488 (Appeal No. 73-1556), Presform alleged that Sun and B. F. Goodrich (Goodrich) violated the antitrust laws by entering into reciprocal dealing and rebate agreements in 1953 with respect to the licensing of Sun’s Molitor and Martin patents. In particular, Presform alleged that Goodrich took a license under these patents knowing that they were of doubtful validity. Under the license agreement, Goodrich agreed to make annual lump sum payments in lieu of royalties. The primary motive for this contract allegedly was the agreement of Sun to purchase its requirements of plastic resins from Goodrich and to promote Goodrich as a source of supply for its licenses. The purported effect of this license agreement was to create a false inference that the Sun patents had attained general commercial acceptance. It was charged that this erroneous inference, along with other alleged acts of deception, contributed to the erroneous decision of this court in 1959 in affirming the District Court’s upholding of the validity of the Molitor patent in National Latex Products, supra.

In Civil Action C68-489 (Appeal No. 73-1557), Presform alleged that Sun, McNeil and Goodrich conspired to restrain trade and tend to create a mono-ply in the use of rotational casting techniques, materials and equipment. Two separate activities of these purported conspirators are alleged to have injured Presform’s business. First, a leading company in the doll industry purportedly was coerced into taking a license in 1961 under the Molitor patent although it believed that the patent was invalid. Second, the appellee corporations allegedly issued a large number of letters to the doll industry in 1961 threatening patent infringement suits under the Molitor patent, and this purportedly lessened the market for Presform’s machines and accelerated the destruction of Presform’s business.

The appellees, without acknowledging the accuracy of these factual allegations, moved to dismiss the actions on the grounds that they were barred by res judicata or collateral estoppel or by the statute of limitations. The District Court treated the motions as for summary judgment, Rule 12(b), Fed.R.Civ.P., and dismissed all three actions on the ground that they were barred by the applicable statute of limitations. In the alternative in Civil Action C68-488 (Appeal No. 73-1556), the District Court entered judgment in favor of Sun on the basis that Presform’s action was barred by collateral estoppel.

Statute of Limitations Presform’s basic contention on appeal in all three actions is that the District Court erred in concluding that the actions were barred by the applicable statute of limitations for anti-trust claims, 15 U.S.C. § 15b. 15 U.S.C. § 15b, in relevant part, provides: “Any action to enforce any cause of action under sections 15 or 15a of this title shall be forever barred unless commenced within four years after the cause of action accrued.”

As the Supreme Court stated in Order of Railroad Telegraphers v. Railway Express Agency, 321 U.S. 342, 348-349, 64 S.Ct. 582, 586, 88 L.Ed. 788 (1944), statutory limitation periods are:

“. . . designed to promote justice by preventing surprises through the revival of claims that have been allowed to slumber until evidence has been lost, memories have faded, and witnesses have disappeared. The theory is that even if one has a just claim it is unjust not to put the adversary on notice to defend within the period of limitation and that the right to be free of stale claims in time comes to prevail over the right to prosecute them.”

This statute of limitations commences to run from the commission of the last overt act causing injury or damage. Zenith Radio Corp. v. Hazeltine Research, Inc., 401 U.S. 321, 338, 91 S.Ct. 795, 28 L.Ed.2d 77 (1971); Garelick v. Goerlich’s Inc., 323 F.2d 854, 855 (6th Cir. 1963). Generally, there are two means by which one can avoid the operation of the statute of limitations. One, the rule enunciated in Zenith Radio Corp., supra, 401 U.S. at 338-342, 91 S.Ct. 795 provides that a plaintiff may recover damages occurring within the period of the statute of limitations that are the result of conduct occurring prior to that period, if at the time of the conduct, those damages were speculative, uncertain or otherwise incapable of proof. Second, in cases in which the plaintiff has refrained from commencing suit during the period of limitation because of inducement by the defendant, Glus v. Brooklyn Eastern Terminal, 359 U.S. 231, 79 S.Ct. 760, 3 L.Ed. 2d 770 (1959), or because of fraudulent concealment, Holmberg v. Armbrecht, 327 U.S. 392, 66 S.Ct. 582, 90 L.Ed. 743 (1946), the Supreme Court has held the statutory period to have been suspended or tolled by the conduct of the defendant.

Since the above rules are in avoidance of the statute of limitations, the party seeking the benefit of them has the burden of proof to establish them. All presumptions are against him, since his claim to exemption is against the current of the law and is founded on exceptions. See, e. g., Baker v. F & F Investment, 420 F.2d 1191, 1199 (7th Cir. 1970); 51 Am.Jur.2d Limitations of Actions, § 485; 54 C.J.S. Limitations of Actions § 386b.

Since the complaints in the present action were filed on July 3, 1968, the first question is whether any injurious overt act has occurred since July 3, 1964. Presform admitted to the trial court that all acts commencing the alleged unlawful conspiracies began more than four years before the filing of the complaints in these actions, but contended that its antitrust claims were not barred because its claims fell within the Zenith and fraudulent concealment exceptions to the application of the statute of limitations. The burden thus shifted to Presform to prove that the operation of the statute could be avoided by either exception.

In support of its contention that the Zenith and fraudulent concealment exceptions apply in the present case, Presform primarily relies on the 1967 decision of the Southern District of New York in Barr Rubber Products, supra, which held that Sun was guilty of fraud and perjury in obtaining the Molitor patent. Presform claims that it did not sleep on its rights, in that it was merely abiding by this court’s decision in National Latex Products, supra, and that it was not until the alleged irregularities of the appellees came to light in the Southern District Court of New York that it knew of the existence of its cause of action. Presform is unable, however, to succeed in maintaining this contention because the Second Circuit subsequently reversed the District Court’s findings of fraud and perjury. The fact that the Second Circuit remanded the case for new trial on the issue of patent-ability does not detract from the Second Circuit’s decision reversing the District Court’s findings of fraud and perjury.

Further, Presform contends that it was not until the Supreme Court’s decision in Walker Process Equipment, Inc. v. Food Machinery & Chemical Corp., 382 U.S. 172, 86 S.Ct. 347, 15 L.Ed.2d 247 (1965), that its cause of action became definite. In Walker, the Supreme Court held that fraud in the procurement and maintenance of a patent may be actionable under the antitrust laws provided all other elements of a monopolization charge are proven. Walker says nothing about conspiracy claims, which are alleged in each of Presform’s three actions, and thus plainly does not excuse Presform’s delay in bringing its conspiracy charges. Further, the Zenith rule tolls the statute of limitations where damages are speculative, not where the very existence of the cause of action is speculative. Finally, the District Court correctly ruled that there is no evidence in the record tending to prove that Pres-form suffered any damages incapable of proof within four years after the overt acts complained of. Presform’s sleeping on its rights does not therefore fall within the Zenith exception to the application of the statute of limitations.

Finally, the District Court, after examining the pleadings, briefs, and exhibits, correctly determined that Pres-form had not alleged or demonstrated by affidavit or otherwise that it had exercised due diligence in attempting to discover the cause of action. At best, as the District Court stated, there was nothing more than ignorance on the part of Presform of its rights. This alone is insufficient to overcome the limitations defense. Accordingly, Presform cannot avoid the statute of limitations on the ground of the fraudulent concealment rule.

Without reaching the merits of Pres-form’s claims, we hold that the District Court did not err in dismissing Pres-form’s actions as barred by the statute of limitations. Presform allowed its claims to slumber. Evidence has faded and witnesses may have disappeared. Since neither the Zenith exception nor the fraudulent concealment exception tolled the statute in this case, it was entirely consistent with the purposes of the statute of limitations for the District Court to determine that the appellees should be free of Presform’s stale claims.

Collateral Estoppel

The District Court in Civil Action C68-488 (Appeal No. 73-1556) correctly entered judgment in the alternative in favor of Sun on the basis that this action was barred by collateral estoppel. The District Court reasoned that the unlawful aspects of the license agreement between Sun and Goodrich had been litigated between Sun and Pres-form in the National Latex Products, supra, litigation wherein the District Court held that Sun did not misuse the Martin and Molitor patents. 159 F. Supp. at 664-665. This holding of the District Court was not appealed to this court.

Presform makes numerous allegations of fact, e. g., Sun and Goodrich entered into a self-renewing tying agreement whereby Sun agreed to buy from Goodrich 75 per cent of its annual requirements of resins and certain plastisol components and Goodrich, among other things, agreed to conceal its knowledge of the invalidity of Sun’s Molitor process patent, some of which factual allegations may indeed be raised for the first time in this action. All of the factual allegations, however, relate to the issue previously litigated. In the prior adjudication, Presform stated: “Plaintiff’s license agreement with B. F. Goodrich Company is alleged to be a subterfuge to aid Goodrich in selling its resin to licensees, rather than a bonafide license agreement under the patents in suit.” In strikingly similar language in the present action, Presform alleged “any designation of the annual flat payments advanced by Goodrich to Sun as ‘royalties’ is a mere subterfuge for the rebate to Sun on the purchase of Goodrich material by Sun.”

Under the doctrine of collateral estoppel, “matters which were actually litigated and determined in the first proceeding cannot later be relitigated.” Commissioner of Internal Revenue v. Sunnen, 333 U.S. 591, 598, 68 S.Ct. 715, 719, 92 L.Ed. 898 (1948). Since the unlawful aspects of the license agreement between Sun and Goodrich have been litigated previously, we, therefore, .hold that the District Court correctly entered judgment in Civil Action C68-488 (Appeal No. 73-1556) in the alternative in favor of Sun on the basis that Pres-form’s action was barred by collateral estoppel.

Other Issues

Presform further contends that the equitable doctrine of laches requires that the appellees have waived their, limitations defense since the defense was first raised more than three years after Presform filed its complaints. We conclude that this contention is totally without merit. The motions to dismiss on the basis of the limitations defense were timely filed and any delay in their filing was occasioned by extensions granted by the District Court and our stay of proceedings pending disposition of Pres-form’s motion to reopen the National Latex Products, supra, litigation.

Finally, Presform contends that these actions were inappropriate for disposition on summary judgment, Rule 56, Fed.R.Civ.P. Presform relies on McHenry v. Ford Motor Co. 269 F.2d 18, 22 (1959), wherein this court stated:

“It is the established rule of the federal courts in construing rule 56 that a summary judgment should be entered only in cases where there is no genuine issue as to any material fact ... On considering such a motion the pleadings are to be liberally construed in favor of the party opposing the motion. Purity Cheese Co. v. Frank Ryser Co., 7 Cir., 153 F.2d 88; Wittlin v. Giacalone, 81 U.S.App. D.C. 20, 154 F.2d 20. Moreover, the court is required to take the view most favorable to the party opposing the motion, giving that party the benefit of all favorable inferences that may be drawn from the evidence.”

Although Presform persistently has relied on its factual allegations on the merits of its claims, it has been unable to demonstrate a genuine issue as to material fact relevant to the limitations defense, the basis on which the actions were dismissed by the District Court. Following the mandate of McHenry, we, therefore, conclude that the District Court properly disposed of these cases by means of summary judgment for the appellees.

Affirmed.

      . In National Latea Products, this court actually disposed of two actions, National Latex Products Co. v. Sun Rubber Co. and Akron Presform Mold Co. v. Sun Rubber Co., which had been consolidated for trial at the District Court by consent of the parties. 159 F.Supp. 661 (N.D.Ohio 1958).

      . Sun Rubber Co. was the predecessor in interest of Sun Corporation, an appellee, in the present actions.

      . CHus and Solmierg were cited approvingly by tbe Supreme Court in American Pipe and Construction Co. v. State of Utah, 414 U.S. 538, 94 S.Ct. 756, 38 L.Ed.2d 713 (1974).

      . Presform asserts that Walker, 382 U.S. at 176-177, 86 S.Ct. 347, holds that fraud in maintaining a patent so as to tend to monopolize a relevant market is a per se violation of the antitrust laws. This contention is erroneous. 382 U.S. at 178, 86 S.Ct. 347.

      . See, generally, 2 J. Moore, Federal Practice U 3.07 [3], at 762-63 (2d ed. 1970), and Laundry Equipment Sales Corp. v. Borg-Wagner Corp., 334 F.2d 788, 792 (7th Cir. 1964), and authorities therein cited, for further support for the proposition that the plaintiff has the burden to demonstrate his exercise of due diligence in discovering the fraud and that mere ignorance of one’s rights does not toll the statute of limitations.


source: Caselaw Access Project

author: FRANK W. WILSON, District Judge.

license: Public Domain

text:
    UNITED STATES of America, Plaintiff-Appellee, v. Lendale HEARN and Murray Taylor, Defendants-Appellants.
    Nos. 73-1603, 73-1604.
    United States Court of Appeals, Sixth Circuit.
    Argued Dec. 4, 1973.
    Decided May 7, 1974.

      Edward Witt Chandler, McKenzie, Tenn. (Court Appointed), for Lendale Hearn.
    Allen J. Strawbridge, Jr., Martin, Tenn., for Murray Taylor.
    Glen Reid, Jr., Asst. U. S. Atty., for plaintiff-appellee; Thomas F. Turley, Jr., U. S. Atty., Memphis, Tenn., on brief.
    Before CELEBREZZE, Circuit Judge, McALLISTER, Senior Circuit Judge, and WILSON, District Judge

       The Honorable Frank W. Wilson, Chief Judge, of Tennessee, sitting by designation. U. S. District Court for the Eastern District

   FRANK W. WILSON, District Judge.

Lendale Hearn and Murray Taylor were convicted of having engaged in a criminal conspiracy to receive and conceal stolen goods moving in interstate commerce in violation of 18 U.S.C. § 371. In addition, Taylor was convicted of the substantive offense of receiving and concealing stolen goods moving in interstate commerce in violation of 18 U.S.C. § 2315. Hearn received a three year sentence, with all but six months having been suspended, and with 30 months probation to follow. Taylor received two concurrent sentences of a year and a day, together with a fine of $500.00 upon each of the two counts upon which he was convicted. The principal contentions of error made by each appellant in these appeals, which have been consolidated for hearing, center around the admissibility of evidence obtained in the course of certain searches and seizures and the sufficiency of the evidence to warrant their respective convictions.

The record upon these appeals reflects • that the appellants were indicted jointly with two other individuals, L. J. Griffin and Dewey Berryhill, in a four-count indictment. The first count charged all four defendants with having engaged in a conspiracy to transport, receive and conceal stolen property and stolen motor vehicles moving in interstate commerce. The second and third counts charged the co-defendant Griffin with the substantive offense of receiving and concealing stolen property moving in interstate commerce. The fourth count charged the appellant Taylor with the substantive offense of receiving and concealing stolen property moving in interstate commerce. Upon the trial of the case the jury found Hearn, Taylor and Griffin guilty upon the conspiracy count but acquitted the co-defendant Berryhill on that count. In addition, Griffin was found guilty upon the second and third counts and Taylor was found guilty upon the fourth count. No appeal was taken by the co-defendant Griffin in regard to his convictions.

The appellants, Hearn and Taylor, contend, among other matters, that the evidence was insufficient to support their respective convictions. The settled rule, in this regard, is that in reviewing the sufficiency of the evidence to support a conviction this Court “ . cannot weigh the evidence but we must take the view of it, and the inferences reasonably and justifiably to be drawn from it, most favorable to the Government and determine therefrom whether a verdict against the appellant might have been lawfully rendered . . .” United States v. Wolfenbarger, 426 F.2d 992 (6th Cir. 1970).

When all reasonable inferences are accorded and the evidence is viewed in the light most favorable to the Government, the jury could have found the following facts, having reference to the charges in the first count of the indictment, to have been established beyond a reasonable doubt. Sometime during the evening of Sunday, October 3, 1971, a Model #2200 Massey-Ferguson tractor, having a front end loader on one end and a baekhoe on the other and having a value of $5,500.00 (which equipment will hereinafter be referred to simply as a backhoe), was stolen from the premises of its owner, the McBride Construction Company, in Paris, Tennessee. The baekhoe, which was painted yellow and had certain distinctive features, including plastic sleeves placed over the hydraulic lines by the owner to afford additional protection to those lines, was loaded at the time of the theft upon a yellow 3-axle metal trailer, which in turn was hitched to a yellow truck. All three pieces of equipment were stolen upon the occasion of October 3,1971.

Sometime during the first part of October, 1971, the defendant Hearn, accompanied by the co-defendant Berryhill, was observed driving a truck and trailer loaded with a baekhoe, all of the equipment being of the same description as the stolen equipment, in Weakley County, Tennessee, which adjoins Henry County where Paris, Tennessee is located. Upon this occasion the defendant Hearn was observed making a delivery of the baekhoe to the co-defendant Griffin at his farm in Weakley County, Tennessee. Hearn and Griffin conversed for some 30 minutes at the time of this delivery and then Hearn left, driving the truck and trailer, but leaving the‘backhoe with Griffin. About a week after the theft occurred, the truck and trailer were discovered abandoned along the highway in Weakley County, Tennessee, and were returned to their owner.

The defendant Taylor also lived on a farm in Weakley County, Tennessee, his farm being some three miles from the farm of the defendant Griffin. During the months of October and November 1971, Taylor was observed to have on his farm a baekhoe of the same make, model and description, and having the same distinctive features as the stolen backhoe. He told an acquaintance that he had obtained the baekhoe from a certain individual. Upon the trial that individual denied the statement. During the time that Taylor had the baekhoe he allowed a neighbor to use it. Several persons who observed the baekhoe on this occasion testified that it was the same piece of equipment as the baekhoe that they inspected at the McBride Construction Company when the stolen baekhoe was recovered. When Taylor retrieved the baekhoe from his neighbor, he stated that he had to deliver it to someone else. In February of 1972, after the stolen baekhoe had been recovered, Taylor was interviewed by the F.B.I. and denied that he had ever had a baekhoe in his possession or on his farm.

In late December 1971, the defendant Griffin delivered the baekhoe to an equipment dealer in Marion, Arkansas, with instructions that he rent it or sell it for him. On this occassion, Griffin, quoted such a low price on the equipment that the dealer asked if it were “hot,” to which Griffin replied, “It may be a little warm.” In another conversation Griffin advised the dealer that he would get rid of the baekhoe “if I have to run it off in the river.”

On January 8, 1972, Griffin picked up the baekhoe in Marion, Arkansas, and transported it back to his farm in Weakley County, Tennessee. On January 14, 1972, the baekhoe was found in a tool shed on Griffin’s farm by local law enforcement officers in the course of a search of the premises.

In addition to the foregoing evidence regarding the baekhoe, evidence was introduced in regard to a motorcycle referred to in one of the overt acts alleged in the conspiracy count. That evidence reflected that a Honda motorcycle, bearing a certain identification number, was stolen in LaFayette, Louisiana, on a date believed by the owner to have been in about October of 1971. The defendant Hearn was shown to have returned from the vicinity of LaFayette, Louisiana, to Weakley County, Tennessee, in an enclosed truck during the latter part of September of 1971. In December of 1971 Griffin traded the Honda for another piece of equipment at a motorcycle shop in Union City, Tennessee.

The fourth count of the indictment charged the appellant Taylor with the substantive offense of receiving and concealing a stolen traxeavator moving in interstate commerce. When the evidence in regard to this count is viewed in a light most favorable to the Government, the jury could find the following facts to have been established beyond a reasonable doubt. Upon March 17, 1971, a new Caterpillar traxeavator, Model No. 955K, bearing a certain identification number and having a value of $31,000 was stolen from the S & W Construction Company in Memphis, Tennessee. Upon October 15, 1971, the traxeavator was recovered by the police in Gary, Indiana. Two days later the traxeavator was again stolen, this time from the lot where the police had stored the equipment. Upon January 12, 1972, the traxcavator was located in a barn upon the farm of the appellant Taylor in Weakley County, Tennessee, during the course of a search of the premises by local law enforcement officers. Bales of hay had been placed around the traxeavator to conceal its presence in the barn. Taylor had purchased the hay some months previous to feed two horses which he kept in the barn lot. When shown the traxeavator following its discovery, Taylor remarked to the officers “You would-n’t believe that somebody could put this in my barn and me not know it.”

Upon the foregoing state of the record it is clear that sufficient evidence exists to support the verdict as to both Hearn and Taylor upon the conspiracy count. It is contended that evidence of a conspiratorial agreement is lacking. While the evidence may be insufficient to establish a conspiratorial agreement regarding the transportation of the motorcycle, there is a clear sufficiency of the evidence to establish a conspiratorial agreement regarding the receiving and concealing of the backhoe. It is not necessary that the proof establish a formal agreement in this regard. It is sufficient if the unlawful agreement may be inferred from all of the circumstances. As stated by this Court in the case of Poliafico v. United States, 237 F.2d 97, 104 (6th Cir. 1956);

“Participation in a criminal conspiracy need not be proved by direct evidence; a common purpose and plan may be inferred from a development and collocation of circumstances.”

It is likewise clear that the evidence is sufficient to support the jury vefdict finding the appellant Taylor guilty of receiving and concealing the traxeavator as charged in the fourth count of the indictment.

However, with respect to each of; the foregoing counts it is contended by the appellants that evidence obtained as a result of an unlawful search was improperly admitted in the course of their trial, and that the verdict was rendered invalid accordingly. Regarding the conspiracy count, it is contended that the trial court was in error in failing to sustain the motion of each defendant seeking to suppress evidence obtained as a result of the search of the co-defendant Griffin’s farm, which search led to the discovery of the backhoe in his tool shed. Regarding the fourth count, it is contended that the trial court was in error in failing to sustain the motion of the defendant Taylor to suppress evidence obtained as a result of a search leading to the discovery of the traxcavator in his barn. This Court must accordingly turn its attention to these contentions.

With respect to the search which led to the discovery of the stolen backhoe in the tool shed of the co-defendant Griffin, certain additional facts become relevant. As previously noted, upon January 8, 1972, Griffin returned the backhoe from Marion, Arkansas, to Weakley County, Tennessee. There was also evidence in the record which would reflect that upon the same weekend Griffin stole a Model B-4 Caterpillar Bulldozer from the dealer in Marion, Arkansas, and transported it to Weakley County, Tennessee, where he concealed it on an abandoned farm near his home, a matter for which he was convicted as charged in the second count of the indictment. When local law enforcement officers received information regarding the theft of the bulldozer, they obtained a warrant to search the Griffin farm for it. In the course of an unsuccessful search for the bulldozer, they discovered a backhoe in the tool shed and secured its identification number. Using this means to confirm that the backhoe was stolen, they obtained a search warrant and returned to the premises and seized the backhoe, which was the stolen equipment referred to in the conspiracy count.

It appears, however, as asserted by the appellants, that each of the above referred to search warrants was defective in one or more respects, including the fact that they each recited that the information contained therein had been obtained from an informant whose identity was not stated and whose reliability was not reflected so as to enable the magistrate to form a judicial opinion thereon, all as required by Aguilar v. Texas, 378 U.S. 108, 84 S.Ct. 1509, 12 L.Ed.2d 723 (1964), and Spinelli v. United States, 393 U.S. 410, 89 S.Ct. 584, 21 L.Ed.2d 637 (1969).

In response to this contention, it is the position of the Government that the appellants had no interest in the premises where the backhoe was found, and therefore have no standing to question the legality of the search of those premises. It is true, as contended by the Government, that neither Hearn nor Taylor has ever asserted any interest in the backhoe or in the Griffin premises that were searched.

It is well settled, of course, that “Fourth Amendment rights are personal rights which, like some other constitutional rights, may not be vicariously asserted.” Alderman v. United States, 394 U.S. 165, 174, 89 S.Ct. 961, 22 L.Ed.2d 176 (1969). In order to have standing to object to an unlawful search, a person must have been the victim of the unlawful search. That is, he must have been the person against whom the search was directed, as distinguished from one who claims prejudice only through the use of evidence gathered as a consequence of a search directed at another.

As a basis for asserting the right to object to the search of Griffin’s premises, the appellants make two contentions. Relying upon McDonald v. United States, 335 U.S. 451, 69 S.Ct. 191, 93 L. Ed. 153 (1948), they assert that if one co-defendant has standing to challenge an unlawful search, all other co-defendants likewise have standing. Relying upon Jones v. United States, 362 U.S. 257, 80 S.Ct. 725, 4 L.Ed.2d 697 (1968), they assert that where possession is an essential element of the offense charged, all defendants charged with such possession have standing to challenge an unlawful search regardless of any lack of personal interest in the premises searched or the property seized.

The foregoing general propositions are not, however, an accurate statement of the present law. Any bases for drawing such general propositions of law from the cases of McDonald v. United States, swpra, and Jones v. United States, supra, have been largely, if not wholly, removed by the later cases of Alderman v. United States, 394 U.S. 165, 173 n. 7, 89 S.Ct. 961, 22 L.Ed.2d 176, 186 n. 7 (1968) (limiting the automatic standing rule of McDonald to guests “on the premises searched”) and Simmons v. United States, 390 U.S. 377, 88 S.Ct. 967, 19 L.Ed.2d 1247 (1968) (forbidding the use upon trial of pretrial admissions against interest made to achieve Fourth Amendment standing in a motion to suppress evidence, thereby removing much of the rationale for the automatic standing rule enunciated in Jones v. United States).

Furthermore, the present case, involving as it does co-defendants to a conspiracy charge seeking to assert Fourth Amendment standing through a co-conspirator, would come within the rules only recently laid down in the case of Brown v. United States, 411 U.S. 223, 93 S.Ct. 1565, 36 L.Ed.2d 208 (1973). In Brown two defendants were convicted of conspiring with a third to transport stolen goods in interstate commerce. Evidence obtained from an unlawful search of the co-conspirator’s premises was admitted in the separate trial of the other two defendants. Concluding that no- error was made in thus admitting the evidence as to the two defendants who “failed to allege any legitimate interest of any kind in the premises searched or the merchandise seized,” the Court stated:

“[T]here is no standing to contest a search and seizure where, as here, the defendants: (a) were not on the premises at the time of the contested search and seizure; (b) had no proprietary or possessory interest in the premises; and (c) were not charged with an offense that includes, as an essential element of the offense charged, possession of the seized evidence at the time of the contested search and seizure . . .” 411 U.S. at 229, 93 S.Ct. at 1569, 36 L.Ed.2d at 214.

The appellants seek to avoid the rules laid down in Brown and maintain standing to assert Fourth Amendment rights with regard to the search of their co-defendant’s premises both by distinguishing the facts in Brown from the present case and by asserting that possession at the time of the search was an essential element of the offense with which they were charged and convicted.

In seeking to distinguish Brown they assert that no prior illegal search was there involved, that, unlike the present case, the conspiracy charged was limited to a date prior to the date of the search under attack and that the offense charged in Brown was a conspiracy to transport, and not a conspiracy to receive and conceal, the contention here being that, unlike Brown, possession is an essential element of the offense for which the appellants were charged and convicted. These distinctions, however, are of no avail. The appellants would no more have' standing to complain of a prior search of the Griffin premises than they would to complain of the search under attack. All other attempted distinctions are predicated either upon the assumption that a co-conspirator’s claim of constructive possession is sufficient to accord him standing, an invalid assumption and one implicitly rejected in footnote number 4 of the Brown opinion, or upon the assumption that possession at the time of seizure is an essential element of the crime of conspiracy to receive and conceal, an invalid legal deduction. Possession, on the day of seizure or otherwise, is not an essential element of the crime of conspiracy to receive and conceal. The crime of conspiracy is not the same as the substantive crime which is the objective of the conspiracy. The gist of the crime of conspiracy to receive and conceal is the unlawful agreement to receive and conceal, accompanied by one or more acts in furtherance of the unlawful agreement. United States v. Ketola, 455 F.2d 83, 85 (9th Cir. 1972).

Applying the rules laid down in Brown v. United States, supra, to the facts of this case, the appellants were without standing to object to the search of their co-defendant’s premises and the evidence obtained as a result of the search was properly admitted as to them.

Turning to the contention of the appellant Taylor that the trial court was in error in failing to suppress evidence obtained as a result of the search leading to the discovery of the traxcavator in his barn, certain facts additional to those heretofore stated become relevant. Upon January 12, 1972, local law enforcement officers obtained a state warrant to search the defendant Taylor’s premises for a stolen Hobart Welder. Having located the welder at one outbuilding, they continued the search by going to a barn some 150 yards away where they located the traxcavator concealed behind bales of hay. Taylor was not present on the farm at the time of this search. He returned shortly thereafter, however, and was told by the officers of their seizure of the stolen welder. A warrant of arrest having been procured in the meanwhile by one of the officers, Taylor was advised of his arrest and of his constitutional rights in regard thereto. Without disclosing their prior search of his barn, the officers then proceeded to interrogate Taylor regarding the traxcavator. Although there is some variance in the testimony at this point, the following testimony of one of the officers is representative of that which occurred:

“The best I remember, one of us asked him about the caterpillar and he said that he didn’t know anything about a caterpillar being in the barn, that he put that hay in there some time ago, six or eight months, and had not been back in that barn since that time and knew nothing about it. So I believe I made the statement to him then: Well, Mr. Taylor, we don’t want to charge you with anything that you don't know anything about, so let’s go look at it.’ ”

In response to this, Taylor said, “Well, let’s go see it.” With Taylor leading the way, he and the officers then went to the barn. Upon observing the traxcavator concealed behind the hay, Taylor remarked, “You wouldn’t believe that somebody could put this in my barn and me not know it.” At no time during these proceedings was Taylor physically restrained in any manner. After the traxcavator was “discovered,” he was permitted to go on his way and turn himself in at the jail later in the day.

Since the search warrant for the Hobart Welder was defective in that it, too, failed to provide adequate facts in regard to the reliability of the informer, as required by Aguilar v. Texas, supra, and Spinelli v. United States, supra, and since it is clear that the continuation of the search after location of the Hobart Welder did not comport with constitutional standards, Marron v. United States, 275 U.S. 192, 48 S.Ct. 741, 72 L.Ed. 231 (1927); Coolidge v. New Hampshire, 403 U.S. 443, 91 S.Ct. 2022, 29 L.Ed.2d 564 (1971), the admission of evidence concerning the location and discovery of the traxcavator can only be supported upon the theory that Taylor’s statements and actions in going to the barn rendered the search on that occasion a consential one.

The trial court found the search to have been a consential one. Before this finding can be overruled, it must be found to have been clearly erroneous. See United States v. Rose, 415 F.2d 742 (6th Cir. 1969), cert. denied, 396 U.S. 971, 90 S.Ct. 458, 24 L.Ed.2d 438 (1969).

It has long been recognized that consential searches are “reasonable” and thus may lawfully be made without a search warrant. Nor does a prior unlawful search render evidence obtained by a subsequent consential search inadmissible, United States v. Willis, 473 F. 2d 450 (6th Cir. 1973), although, as shall be shortly noted, the use of unlawfully obtained information in procuring consent is a relevant fact to consider in determining the voluntary nature of the consent.

The guidelines for testing the validity of a search asserted to have been made with the consent of the accused are those set forth in the recent case of Schneckloth v. Bustamonte, 412 U.S. 218, 93 S.Ct. 2041, 36 L.Ed.2d 854 (1973). As stated by the Court in that case: “The constitutional question in the present case concerns the definition of ‘consent’ in the Fourth and Fourteenth Amendments context.” Starting with the premises that “when a prosecutor seeks to rely upon consent to justify the lawfulness of a search, he has the burden of proving that the consent was, in fact, freely and voluntarily given,” 412 U.S. at 222, 93 S.Ct. at 2045, 36 L.Ed.2d at 860, the Supreme Court rejected the theory that to establish “consent” the prosecution must establish a constitutional “waiver,” that is, “an intentional relinquishment or abandonment of a known right or privilege.” Rather, the Court concluded that voluntariness “is a question of fact to be determined from the totality of all the circumstances.” and “it is only by analyzing all the circumstances of an individual consent that it can be ascertained whether in fact it was voluntary or coerced. It is this careful sifting of the ■ unique facts and circumstances of each case that is evidenced in our prior decisions involving consent searches.” 412 U.S. at 227, 93 S.Ct. at 2048, 36 L.Ed.2d at 863.

Thus, the presence or absence of a single consential or coercive factor is not of itself controlling as a matter of law. As illustratively pointed out by the Court:

“Some of the factors taken into account have included the youth of the accused . . . his lack of education ... or his law intelligence; * * * the lack of any advice to the accused of his constitutional rights, the length of detention . . . the repeated and prolonged nature of the questioning and the use of physical punishment, such as the deprivation of food or sleep ... In all of these cases, the Court determined the factual circumstances surrounding the confession, assessed the psychological impact on the accused, and evaluated the legal significance of how the accused reacted.” (Citations omitted) 412 U.S. at 226, 93 S.Ct. at 2047, 36 L.Ed.2d at 862.

Applying the guidelines in Schneckloth v. Bustamonte to the facts 'of the present case, the factors tending to establish a voluntary and uncoerced consent on the part of the appellant Taylor to the search of his premises include: (a) his having been initially given his Miranda advice of rights incident to his arrest on the stolen welder charge; (b) his continued freedom of movement and the lack of any physical restraint incident to his arrest upon the stolen welder charge; (c) his presence on his own farm and in familiar surroundings; (d) his acquiescence in the officer’s suggestion to “go look at it” (i. e., the traxcavator) and his affirmative response, “Well, let’s go see it”; and (e) his leading the way to the barn and in mounting the bales of hay in advance of the others.

Upon the other hand, factors tending to establish an involuntary and coercive consent search include: (a) the presence of three law enforcement officers on his farm; (b) his initial arrest upon the stolen welder charge; (c) the suggestion by the officers that the barn be inspected for the presence of the traxcavator; (d) the use by the officers of information gained by a prior unlawful search as the predicate for their suggestion that the barn be inspected for the presence of the traxcavator; and (e) the absence of any warning to the appellant that he had a constitutional right to refuse to consent to a search of the barn.

An evaluation of the foregoing would indicate to this Court that the coercive factors, though some of them are subtle and implicit, would nevertheless substantially outweigh the non-coercive ones. As stated in the Schneckloth case:

“In examining all the surrounding circumstances to determine if in fact the consent to search was coerced, account must be taken of subtly coercive police questions, as well as the possibly vulnerable subjective state of the person who consents’” 412 U.S. at 229, 93 S.Ct. at 2049, 36 L.Ed.2d at 864. Bearing in mind that consent must be proved by “clear and positive testimony,” Amos v. United States 255 U.S. 313, 41 S.Ct. 266, 65 L.Ed. 654 (1921), and “must be unequivocal, specific, and intelligently given, uncontaminated by any duress or coercion,” Simmons v. Bomar, 349 F.2d 365 (6th Cir. 1965), this Court is of the opinion that such consent as was here involved was not “freely and voluntarily” given and that the conclusion of the trial court to the contrary was clearly erroneous. See Bumper v. North Carolina, 391 U.S. 543, 88 S.Ct. 1788, 20 L.Ed.2d 797 (1968) (consent held invalid where given on officer’s representation that he had a search warrant). See also Villano v. United States, 310 F.2d 680 (10th Cir. 1962) citing United States v. Page, 302 F.2d 81 (9th Cir. 1962) (“The Government’s burden is greater where consent is claimed to have been given while the defendant is under arrest”).

Furthermore, under the facts of this case, the same result would be required by the application of the legal principle that information gained by law enforcement officers during an illegal search cannot be used in a derivative manner to obtain other evidence, the so-called “fruit of the poisonous tree” doctrine. See Silverthorne Lumber Co. v. United States, 251 U.S. 385, 40 S.Ct. 182, 64 L.Ed. 319 (1920); Nardone v. United States, 308 U.S. 338, 60 S.Ct. 266, 84 L.Ed. 307 (1939). See also Fike v. United States 449 F.2d 191 (5th Cir. 1971); United States v. Brandon, 467 F.2d 1008 (9th Cir. 1972); United States v. Cole, 463 F.2d 163 (2nd Cir. 1972) .

Other matters of less import are complained of by the appellants. These have been considered by this Court and are found to be without merit.

The conviction of each appellant upon Count I of the indictment (conspiracy) will be affirmed. The conviction of the appellant Taylor upon Count IV of the indictment (receiving and concealing) will be set aside and a new trial granted upon that count.


author: JOHN W. PECK, Circuit Judge.

text:
    The DETROIT EDISON COMPANY, Petitioner, v. UNITED STATES ENVIRONMENTAL PROTECTION AGENCY, Respondent.
    No. 73-1552.
    United States Court of Appeals, Sixth Circuit.
    Argued Nov. 30, 1973.
    Decided April 18, 1974.

      Harry H. Voigt, Washington, D. C., for petitioner; Arvin E. Upton, Henry V. Nickel, Washington, D. C., on brief; LeBoeuf, Lamb, Leiby, & MacRae, Washington, D. C., Leon S. Cohan, Peter A. Marquardt, The Detroit Edison Co., Detroit, Mich., of counsel.
    James R. Walpole, Dept. of Justice, for respondent; Wallace H. Johnson, Asst. Atty. Gen., Edmund B. Clark, Martin Green, Attys., Dept. of Justice, Washington, D. C., on brief.
    Before WEICK, PECK and MILLER, Circuit Judges.
   JOHN W. PECK, Circuit Judge.

This case is before us upon petition by the Detroit Edison Company for judicial review pursuant to § 307(b)(1) of the Clean Air Act, 42 U.S.C. § 1857h-5(b)(1) (1970), of a May 14, 1973, regulation promulgated by the Administra» tor of the Environmental Protection Agency (EPA). The May 1973 regulation specifically amended an earlier EPA regulation promulgated in October of 1972 although the subject matter thereof had been neither previously published nor the subject of a public hearing. The EPA terms the amendment a “clarification” of the October 1972 regulation, while the petitioner Detroit Edison characterizes it as a “revision” to the State’s plan, but more than a matter of semantics is involved. A revision would necessitate compliance with the necessary procedural requirements in promulgating the May 1973 regulation, while a mere clarification would not. We conclude that the amendment amounted to a revision.

In early 1972, pursuant to the requirements of § 110 of the Clean Air Act, 42 U.S.C. § 1857c-5(a) (1970), the State of Michigan submitted a plan describing its implementation of Federal primary (health-related) and secondary (welfare-related) ambient air quality standards. The EPA Administrator reviewed the plan and in May of 1972 timely approved it with certain exceptions. 37 Fed.Reg. 10842 (1972). Included in the plan as submitted was a provision referred to as “R 336.49.” This provision is entitled “Emission of sulfur dioxide from power plants” and R 336.49(1) thereof details that it shall be unlawful to burn fuel whose sulfur content exceeds the levels established for July 1975 and July 1978 by a Table 3 (of R 336.-49(7)) or whose sulfur dioxide emissions exceed the levels of Table 4 (of R 336.49(7)). R 336.49(1) further provides that variances or exemptions to the requirements of Tables 3 and 4 may be approved if the emission source furnishes evidence no later than July 1, 1973, that it does not create or contribute an ambient level of sulfur dioxide in excess of the applicable national ambient air quality standards. R 336.49(3) provides that persons operating sources in July 1973 which exceed either the Table 4 emission level or the July 1978 sulfur content level of Table 3 must submit written compliance schedules no later than January 1,1974.

The submission of individual compliance schedules by January 1, 1974, was one of the Administrator’s objections to the Michigan plan for the reason that this date was later than the due date for the State’s first semiannual progress report on the implementation plan. 37 Fed.Reg. 10842, 10873 (1972). According to 40 C.F.R. § 51.15(a)(2), individual compliance schedules must be submitted no later than the due date for that first progress report. In addition, in his comments relevant to all the states’ plans, the Administrator also objected to the several proposals regarding variances :

“Optional Control
“Several State plans include regulations under which a source owner or operator could be exempt from compliance with an applicable emission limitation if he can show that emissions from the source will not interfere with attainment or maintenance of the national standards. The Administrator neither approves nor disapproves such optional control features. States are advised, however, that action taken to allow any such exemptions will constitute revision of a State plan and therefore will be subject at that time to the Administrator’s approval.” 37 Fed.Reg. 10842,10845-46 (1972).

Subsequently, pursuant to § 110(c) of the Act, 42 U.S.C. § 1857c-5(c) (1970), the Administrator published his proposed revisions for those portions of the plan that he disapproved. 37 Fed.Reg. 11826, 11835-36 (June 14, 1972). Public hearings followed on the EPA proposals with the result that in October of 1972 revised regulations were promulgated. 37 Fed.Reg. 23085, 23089 (October 28, 1972). The revised regulations required, in relevant part, that:

“§ 52.1175 Compliance schedules.
* -X- *
“(b) Federal compliance schedule. (1) Except as provided in subparagraph (2) of this paragraph, the owner or operator of a stationary source subject to R 336.49 . . . shall comply with such regulation on, or before, December 31, 1973 ....
* * *
“(2) Any owner or operator of a stationary source subject to subparagraph (1) of this paragraph may, no later than 120 days following the effective date of this paragraph, submit to the Administrator for approval a proposed compliance schedule that demonstrates compliance with R 336.-49 as expeditiously as practicable but no later than the dates specified in R 336.49(7) . . . . ”
* * *
This October 1972 regulation was not challenged by Detroit Edison and is not being challenged here.

After the October 1972 regulation was published, the EPA claimed that it detected misinterpretations of the regulation and accordingly on May 14, 1973, published an amendment to the October 1972 regulation that replaced the general reference to compliance with R 336.49 with the specific reference to “the emission limitations in table 3 or 4 of R 336.49.” In addition, the date for achieving compliance was extended from December 31, 1973 to January 31, 1974, for the claimed purpose of maintaining consistency with the provisions of 40 C. F.R. § 51.15(c). 38 Fed.Reg. 12711, 12712-13 (1972).

The petitioner’s position can be summarized as follows. Under R 336.49 the sulfur limitations are not effective until July 1, 1975 and July 1, 1978, and those limitations do not apply until 1980 to sources obtaining a variance. Under the May 1973 regulation, all sources not submitting compliance schedules are required to comply with the 1978 sulfur limitations by January 31, 1974. In addition, the 1980 compliance date for sources obtaining a variance is eliminated. Petitioner presently has an application for a variance pending.

In examining the contentions of the parties, we first observe that the actual emission limitations are set forth in Tables 3 and 4 of R 336.49. The other parts of R 336.49 refer to schedules for achieving compliance with the limitations. In this respect, the EPA argues that there are three alternative courses of action available to emission sources, namely: (1) to obtain a variance from the requirements pursuant to R 336.-49(1) ; (2) to submit a certification to the EPA that the source is, or will be by December 31, 1973, in compliance with the requirements; or, (3) to submit to the EPA a compliance schedule showing how compliance with Table 3 or 4 will be accomplished. Although our reading of the regulations as amended through October of 1972 indicates that these alternatives are available to the petitioner, we cannot find authority therefore from a reading of the regulations as amended in May of 1973.

It is well settled that an agency’s interpretation of its regulations is properly entitled to deference by the courts unless it is plainly erroneous or inconsistent with the regulations. Udall v. Tallman, 380 U.S. 1, 85 S.Ct. 792, 13 L.Ed.2d 616 (1965); Gulf Oil Corp. v. Hickel, 140 U.S.App.D.C. 368, 435 F.2d 440 (1970). But by changing the language of compliance to specify the emission limitations of Tables 3 and 4, we can only conclude that the May 1973 regulation specifically excludes the variance alternative indicated at R 336.-49(1) from its purview. In contrast, the October 1972 regulation, by its broad language in referring to the entire R 336.49, encompasses the alternative of obtaining a variance. If, as the EPA would have us believe, the May regulation does not in fact alter the terms of the October regulation and allows the petitioner to proceed as if three alternatives exist, then we are faced with the fact that there is no controversy before us. It would follow then that the May regulation is unnecessary except as regards the change in the compliance date which is apparently conceded by the petitioner to be a valid administrative change.

Giving merely the meaning its plain language imparts, it is clear that the May 1973 regulation in fact deletes the variance alternative from the provisions of the implementation plan and thus effects a substantial change thereto. Since the Administrator has not complied with the informal rulemaking requirements of the Administrative Procedure Act (APA), 5 U.S.C. § 553 (1967), the promulgation of the May 1973 regulation must be vacated and the case remanded with instructions to comply with the APA. Buckeye Power, Inc. v. EPA, 481 F.2d 162 (6th Cir. 1973).

The EPA urges that certain statutory exceptions to APA requirements are applicable but our view is that the mere invocation by EPA of the statutory exceptions for interpretative rules is not dispositive as to whether the general rulemaking requirements of the APA are applicable. “The particular label placed upon [a regulation] is not necessarily conclusive, for it is the substance of what the Commission has purported to do and has done which is decisive.” Columbia Broadcasting System, Inc. v. United States, 316 U.S. 407, 416, 62 S.Ct. 1194, 1200, 86 L.Ed. 1563 (1942). Neither can the Administrator justify the lack of notice and opportunity for public comment on the grounds that such is “impracticable, unnecessary, or contrary to the public interest.” This exception, stated in 5 U.S.C. § 553(b) (B), is inapplicable as well because of the substantial impact of the regulation in issue. And the EPA has not argued that promulgation of the regulation was based on purposes of exigency.

The approval of the May 14, 1973, regulation by the Administrator is vacated and the cause is remanded to the Agency.

      . For a discussion of the history and structure of the Olean Air Act, see Buckeye Power, Inc. v. EPA, 481 F.2d 162, 165-167 (6th Cir. 1973).

      . R 336.49. Emission of sulfur dioxide from power.plants.
      Rule 49. (1) It is unlawful for a person to burn in a power plant fuel which does not comply with either the sulfur content limitation of table 3, or which when burned results in sulfur dioxide emissions exceeding an equivalent emission rate as shown in table 4, unless the following conditions are met:
      (a) The source of fuel burning is not subject to federal emission standards for new stationary sources.
      (b) An installation permit, if required by part 2, has been approved by the commission before August 17, 1971.
      (c) The user furnishes evidence that the fuel burning does not create, or contribute to, an ambient level of sulfur dioxide in excess of the applicable ambient air quality standards. The evidence shall be furnished to the commission not later than July 1, 1973 and shall include 12 months of air quality data or equivalent information satisfactory to the commission. The method of obtaining the evidence shall be approved by the commission or its representatives who shall be given the opportunity to calibrate and check the performance of monitors without prior notification of the owner.
      (d) The user is operating in compliance with an order, stipulation or variance from the commission.
      (2) Notwithstanding the provisions of subrule (1), an exception from the limitations of table 3 will not be permitted after January 1, 1980 unless specific authorization is granted by the commission.
      (3) A person responsible for operation of a source which on July 1, 1973 is using fuel with a sulfur content in excess of that allowed to be burned on July 1, 1978 as listed in table 3, or which on July 1, 1973 is emitting sulfur dioxide in excess of the equivalent emission for that fuel as shown in table 4, shall submit to the commission not later than January 1, 1974 a written program for compliance with this rule. This requirement does not apply to a source for which the commission has approved an exception to table 3 under the provisions of subrule (1).
      $ % $ * . sfc $
      (7) The use of fuels having sulfur contents as set forth in this rule shall not allow degradation in the mass rate of particulate emission unless otherwise authorized by the commission. The commission may require source emission tests which may be performed by or under the supervision of the commission at the expense of the owners and may require the submission of reports to the commission both before and after changes are made in the sulfur content in fuel.

      . The time to challenge the October regulation has expired. See, § 307 (b) (1) of the Act, 42 U.S.C.§ 1857h-5(b)(1) (1970).

      . See footnote 2, supra. Advance approval of variances was specifically avoided by the Administrator, 37 Fed.Reg. 10842, 10845-46 (1972), for the apparent reason that each variance must be evaluated as a revision to the basic implementation plan and must pass the same scrutiny as a revision pursuant to 40 C.F.R. § 51.6 (1972).

      . See § 52.1175(b)(1), 37 Fed.Reg. 23085, 23089 (October 28,1972).

      . See § 52.1175(b) (2), id.

      . We are not unaware of tbe fact that although the EPA has stated that it would not bring an action against the petitioner for Federal enforcement pursuant to § 113 of the Act, 42 U.S.C. § 1857c-8 (1970), the petitioner is subject to a civil action under § 304 of the Act, 42 U.S.C. § 1857h-2 (1970).


author: WILLIAM E. MILLER, Circuit Judge.

text:
    MEDUSA CORPORATION, an Ohio corporation, Plaintiff-Appellee, v. Fred GORDON et al., Defendants-Appellants.
    No. 73-1889.
    United States Court of Appeals, Sixth Circuit.
    Argued Feb. 8, 1974.
    Decided April 25, 1974.
    Martin S. Stoneman, Gelman & Hand, P.C., Troy, Mich., for defendants-appellants.
    B. Kingsley Buhl, Detroit, Mich., for plaintiff-appellee; Dickinson, Wright, McKean & Cudlip by John A. Krsul, Jr., Detroit, Mich., on brief.
    Before EDWARDS, PECK and MILLER, Circuit Judges.
   WILLIAM E. MILLER, Circuit Judge.

This is an appeal from the granting of summary judgment for the appellee in an action on a promissory note dated September 30, 1972. The judgment against appellants was for the principal amount of the note, $34,460.64, together with interest.

On the same date, September 30, 1972, appellants executed a release which covered all claims arising out of prior business transactions with Medusa, including a note of February 9, 1970. When the first installment on the September 30, 1972 note was due, the appellants failed to pay. Pursuant to the provisions of the note, the appellee declared the note in default and payment due in full. Each of the appellants was informed of the demand for payment by certified mail.

Having failed to obtain payment. Medusa filed this action in the district court. The appellants filed an answer, alleging lack of notice as an affirmative defense and purporting to reserve the right to allege additional affirmative defenses.

On June 12, 1973 the appellee filed a motion for summary judgment and, subsequently, the appellants filed a motion for leave to file an amended answer, adding as an affirmative defense that the contract sued upon by the plaintiff violated federal antitrust statutes regulating restraints of trade because of an alleged oral agreement that the appellants purchase their cement products exclusively from appellee, Medusa.

After oral argument on the motions, the court below granted the appellee’s motion for a summary judgment and denied the appellants’ motion for the reason that the affirmative defense sought to be added by the appellants was not, as a matter of law, a valid defense to an action on the note. Aside from the so-called affirmative defense, the appellants advanced no reason why the motion for summary judgment on the note should not be granted.

Our review of Michigan law reveals an absence of clear cut precedent on the principal issue before us — whether an oral agreement by the maker of a promissory note that allegedly violates Michigan antitrust laws constitutes a valid affirmative defense to the enforcement of the note.

The transcript of the arguments on the motions below reveals that the district court relied on International Harvester Co. v. Eaton, 163 Mich. 55, 127 N.W. 695 (1910), in deciding that the appellants’ proffered defense was not a valid one to the enforcement of the contract. International Harvester, though informative, is not directly in point. It stands for the proposition that it is no defense to an action on a contract, which is itself legal and valid, that the appellee is a “trust”, “monopoly” or “combination” in restraint of trade, if the transaction was in no way affected or induced by the illegality. The present appellants challenge an element of the contract being sued upon, not the status of the Medusa Corporation as a trust or monopoly.

The appellants urge that Kukla v. Perry, 361 Mich. 311, 105 N.W.2d 176’ (1960), provides guidance as to the ap-. plicable Michigan law. In Kukla the defendant loaned the plaintiffs $18,000.00 and received in exchange a promissory note for $18,000.00 and a chattel mortgage. A provision in the chattel mortgage, on which the defendant attempted to foreclose, required one of the parties to purchase all of its insurance from the defendant — a condition that was in direct contravention of a specific state statute concerning insurance contracts. The Michigan Supreme Court, in refusing to enforce the note or chattel mortgage securing the note, held that the illegal covenant was an essential part of the mortgage and loan and therefore not severable from the contract. Clearly, in the case at hand, the alleged illegal oral agreement was not included within the terms of the written note sued upon nor would enforcement of the contract further the alleged illegal purposes of the oral agreement. Thus Kukla, like International Harvester, would not appear to be decisive of the issue with which we are here concerned.

The paucity of Michigan precedent requires us to look elsewhere for guidance. The United States Supreme Court in Kelly v. Kosuga, 358 U.S. 516, 79 S.Ct. 429, 3 L.Ed.2d 475 (1959), clarified the federal law in this area. In Kelly, the plaintiffs sought payment for the delivery of a large quantity of onions. The defendant admitted receiving the onions, but asserted illegality of the transaction under Section 1 of the Sherman Act as a defense to the enforcement of the debt. Without deciding the legality of the transaction the Court assumed “That the [defendant’s] allegations duly charge a violation of the Sherman Act.” 358 U.S. at 518 n. 2, 79 S.Ct. at 431. The Court nevertheless held that the debt was enforceable. In doing so the Court stated:

“As a defense to an action based on contract, the plea of illegality based on violation of the Sherman Act has not met with much favor in this Court. This has been notably the case where the plea has been made by a purchaser in an action to recover from him the agreed price of goods sold.” ******
“If the defense of illegality is to be allowed as a collateral method of enforcement of the antitrust laws, as the breadth of the petitioner’s argument suggests, it must be said that this theory creates a very strange class of private attorneys general.”
* * * * * *
“Past the point where the judgment of the Court would itself be enforcing the precise conduct made unlawful by the Act, the courts are to be guided by the overriding general policy, as Mr. Justice Holmes put it, ‘of preventing people from getting other people’s property for nothing when they purport to be buying it.’ ” 358 U.S. at 518-521, 79 S.Ct. at 431.

The teachings of Kelly were followed by this Court in Atlantic Richfield Co. v. Malco Petro, 471 F.2d 1258 (6th Cir. 1972), an action by a manufacturer of petroleum products to recover on a distributor’s promissory note given in connection with a loan made at the time the distributorship agreement was signed. The distributor attempted to avoid the obligation by asserting that the extension of credit was part of an illegal tying arrangement devised by the petroleum company. This Court rejected the proffered defense, stating:

“Sometimes a party will claim the existence of such an illegal tying arrangement as a defense to a suit on a debt or contract in furtherance of such an arrangement. The use of this defense, however, is not favored and has been limited by the Supreme Court strictly to situations where enforcement of a debt or contract would make the courts ‘a party to the carrying out of one of the very restraints forbidden by the Sherman Act.’ ”
* * * * * *
“The appellant will not be allowed to use the antitrust law to avoid paying its just debts. If there was an illegal tying agreement and if the distributor here was injured, there is an adequate remedy under the provisions of the antitrust laws.” Id. at 1260-1261.

Enforcement of the promissory note in this case in no way furthers the alleged illegal activity of Medusa.

We are persuaded .that the Michigan Supreme Court on the facts presented here would apply the same rationale applied by the Supreme Court in Kelly and by this Court in Maleo. If the purported oral agreement is violative of antitrust laws, an issue we do not here decide, the remedy lies in antitrust litigation under appropriate statutes, not in avoidance of a just debt.

Affirmed.

      . The appellants’ original motion for leave to file an amended answer alleged that a purportedly illegal oral agreement between the appellee and the appellants was part of the contract sued upon and that this illegality, arising from violations of federal antitrust laws, constituted an affirmative defense to enforcement of the contract. However, at argument on this motion, the appellants also took the position that this exclusive purchase agreement violated Michigan Antitrust laws, M.S.A. § 28.51 and 28.52, M.O.L.A. §§ 445.731, 445.732, thus constituting another affirmative defense to its enforcement. On appeal, the appellants appear to have abandoned the purported affirmative defense based on federal antitrust law violations. We therefore only analyze the validity of alleged Michigan antitrust law violations as an affirmative defense to the enforcement of the contract in issue. However, federal law is helpful in determining the Michigan law on the issue before us.

      . Indeed, we were advised at oral argument that appellants have sued Medusa in federal court for the alleged violation of the federal antitrust statutes in connection with the same alleged oral agreement here complained of. This action is presently pending.


author: PER CURIAM:

text:
    UNITED STATES of America, Plaintiff-Appellee, v. Robert DRISCOLL, Defendant-Appellant.
    No. 615, Docket 73-2005.
    United States Court of Appeals, Second Circuit.
    Argued March 6, 1974.
    Decided May 6, 1974.

      Michael B. Standard, New York City (Dorian Bowman, Rabinowitz, Boudin & Standard, New York City, of counsel, for defendant-appellant.
    Raymond J. Dearie, Asst. U. S. Atty. (Edward John Boyd, V, Acting U. S. Atty. E. D. N. Y., L. Kevin Sheridan, Anthony T. Accetta, Asst. U. S. Attys., Brooklyn, N. Y., of counsel), for plaintiff-appellee.
    Beforfe MOORE, MANSFIELD and OAKES, Circuit Judges.
   PER CURIAM:

Upon appellant’s plea of guilty to one count charging unlawful importation of hashish in violation of Title 21 U.S.C. § 841(a)(1), one count charging possession of marijuana with intent to distribute, Title 26 U.S.C. §§ 4755(a) and 7237(a), and two counts charging failure to appear for arraignment, Title 18 U.S.C. § 3150(1), Judge Travia imposed consecutive prison sentences of 5 years on the hashish count to be followed by 7% years imprisonment on the marijuana count, and to concurrent terms of 5 years on the two bail-jumping counts. This appeal is from the court’s order entered on June 1, 1973, denying an application for permission to photocopy the presentence report and an FBI report of his prior arrests and convictions for transmittal to appellant at his place of incarceration and denying his motion for reduction and/or modification of sentence pursuant to Rule 35, F.R.Cr.P. We affirm.

Before sentence was imposed appellant’s counsel was permitted to review the presentence report in consultation with appellant and he drew the court’s attention to certain alleged misstatements in the report. Under these circumstances the district court acted well within its discretion in denying appellant’s later application to photocopy the report. See Rule 32(c) (2), F.R.Crim.P.; United States v. Brown, 470 F.2d 285, 288 (2d Cir. 1972); Lehrich, The Use and Disclosure of Presentence Reports in the United States, 47 F.R.D. 225 (1969).

Appellant’s arguments that it was a violation of Rule 32, F.R.Cr.P., not to have permitted him at the time of sentence to address not only the sentencing judge but the other two members of the multi-judge sentencing panel consulted by Judge Travia prior to his imposition of sentence, and that it was error not to have them examine newly offered data in support of his Rule 35 motion, border on the frivolous. The Eastern District’s general utilization of sentencing panels is a matter of such common knowledge, see Zavatt, Sentencing Procedure in the United States District Court for the Eastern District of New York, 41 F.R.D. 469 (1966), 54 F.R.D 327 (1968), that counsel may be charged with awareness of their use. Nevertheless appellant made no request to address the panel either at the time of sentencing or prior to decision of his Rule 35 motion. Even if such a request had been made, however, denial would have been proper. As we pointed out in United States v. Brown, 470 F.2d at 289, the function of the two other members of the panel consulted by the sentencing judge is “purely advisory.” The sentencing judge, in this case Judge Travia, remains solely responsible for the sentence that is imposed in each case. Incorrect data submitted to the panel members in the presentence report cannot be said to have prejudiced appellant where that erroneous data was brought to the attention of the trial judge prior to actual sentencing and, as here, he expressly disclaimed reliance on them. In ruling on appellant’s Rule 35 motion Judge Travia concluded, after considering the newly offered data, that no change in sentence was warranted. Since the FBI report regarding appellant’s prior convictions was not in any event received by the sentencing judge until after sentence was imposed, it could not have influenced him.

Judge Travia’s failure to state the reasons for the sentences totalling 12% years in prison, which appear rather harsh on the record before us, raises a more serious question. We have, it is true, eschewed appellate review of sentences that are within statutory limits, at least in the absence of evidence that the sentencing judge relied upon constitutionally impermissible factors, and we have refused to require a sentencing judge to state his reasons. See McGee v. United States, 462 F.2d 243 (2d Cir. 1972); United States v. Brown, 479 F. 2d 1170, 1172 (2d Cir. 1973). However, we have encouraged the sentencing judge to state his reasons, especially where to do so would clarify doubts as to possible reliance upon misinformation of constitutional magnitude or failure to consider mitigating circumstances. See United States v. Brown, 479 F.2d at 1173. In view of the apparently unwarranted harshness of the consecutive sentences imposed, a statement of reasons would have been welcomed by us in the present case. At the time of sentencing appellant was 29 years of age. Although his minor dealing in narcotics, his brief resistance to arrest, and his fleeing the jurisdiction, could hardly be condoned and called for imposition of a prison sentence, he does not appear to be a hardened recidivist or a person posing a serious threat to society. Indeed, Judge Travia agreed that appellant’s conduct in using hashish and marijuana was a “victimless act” (A-69a). He further conceded that there was “nothing before this Court which indicates that the crimes involved here have hurt anybody besides the defendant” (A-69a) and that “there is nothing before the Court which indicates there was any organized crime involvement or any profit motives” (A-69-70). Nevertheless he imposed sentences totalling 12% years.

Although the minutes of the hearings at the original sentence and upon argument of appellant’s Rule 35 motion total 57 transcript pages, the sole reasons suggested by Judge Travia for the harsh sentence were that appellant had been “quite a scamp” (A-77a), “a little bit incorrigible from his early youth,” and had become “involved with the law on many occasions” (A-103a). However, the record reveals that until the present cases appellant had had only one prior felony conviction, which was for assault arising out of a marital dispute and resulted in a sentence of five years probation. Thereafter there was evidence that that conviction may have been obtained on the basis of perjured testimony by his former wife, who later sought to recant (A-59a-60a). Furthermore, Judge Travia stated that he was not relying upon the record of the earlier convictions as recited in the presentence report (A-55, 57a, 58a).

Although we adhere to our rule against appellate review of sentences— at least one of us with some reluctance in this case — we suggest that, in view of the apparent uncertainty as to appellant’s record and other relevant circumstances, the conscientious district judge may wish sua sponte to again review the record and determine whether there should not be a reduction in the sentence imposed upon appellant.

Affirmed.


author: WEICK, Circuit Judge.

text:
    AVERY PRODUCTS CORPORATION, Plaintiff-Appellant and Cross-Appellee, v. MORGAN ADHESIVES COMPANY, Defendant-Appellee and Cross-Appellant.
    Nos. 73-1699, 73-1700.
    United States Court of Appeals, Sixth Circuit.
    Argued Dec. 10, 1973.
    Decided April 30, 1974.

      Charles B. Gordon, Cleveland, Ohio, for plaintiff-appellant; McNenny, Farrington, Pearne & Gordon, Cleveland, Ohio, on brief; Harry C. Donkers, San Marino, Cal., for Avery Products Corp.
    Frederic M. Bosworth, Cleveland, Ohio, for defendant-appellee; Bosworth, Sessions & McCoy, Cleveland, Ohio, on brief; William S. Burton, Arter & Hadden, Cleveland, Ohio, for Morgan Adhesives Co.
    Before WEICK and McCREE, Circuit Judges, and CECIL, Senior Circuit Judge.
   WEICK, Circuit Judge.

Avery Products Corporation (Avery) appeals from a summary judgment of the District Court dismissing its complaint against Morgan Adhesives Company (Morgan), alleging infringement of its Engelbach U.S. Patent 3,343,978 covering an improvement in adhesive transfers. Morgan cross-appeals from an order of the District Court dismissing its three counterclaims.

Avery and Morgan are competitors, each engaged in the manufacture of various adhesive products. Avery is the assignee of the patent which was granted to Thomas J. Engelbach by the Patent Office on September 26, 1967, and which had been applied for on January 9, 1964 as a continuation-in-part of an earlier application filed on March 29,1961.

The claims of the Engelbach patent are set forth in the footnote.

Avery’s original complaint charged Morgan with infringement of claims 1 through 7 of the patent, but a later statutory disclaimer of claims 1 through 5, and 7, left only an alleged infringement of claim 6.

Morgan filed three counterclaims against Avery, seeking a declaratory judgment of invalidity of the patent, and of noninfringement, and alleged that Avery had violated Section 2 of the Sherman Act by monopolistic practices. 15 U.S.C. § 2.

After extended discovery over a period of more than four years, which included interrogatories, requests for admissions, and numerous depositions and affidavits, Morgan moved for summary judgment on the issue of invalidity, which motion was considered by the Court on the briefs and the record. The grounds of invalidity alleged by Morgan were that Engelbach was anticipated by U.S. Patent 3,041,682 issued to Sterling Alderfer of Akron, Ohio, which was applied for on May 21, 1957 and issued on July 3, 1962. 35 U.S.C. § 102(e).

Second, Morgan further alleged that public sales or uses of structures embracing the patent claims were made by Avery to Alderfer and to Vitronic, Inc., more than one year prior to the date of the application for the Engelbach patent, making it invalid under 35 U.S.C. § 102(b).

Third, Morgan alleged that any differences between the prior art and the invention described in claim 6 would have been obvious at the time it was applied for, and thus the patent would have been invalid under 35 U.S.C. § 103.

While the motion for summary judgment was under consideration the District Court, sua sponte, appointed a patent attorney as Special Master “to complete the Judge’s findings of fact and conclusions of law for the purpose of ruling on defendant’s motion for summary judgment.” The stated reason for the appointment was the complexity of the case and the hospital confinement of the District Judge.

The District Court handed down an opinion and order in which it held that the Engelbach patent was invalid. It dismissed the plaintiff’s complaint and also dismissed all three counterclaims of defendant, although the counterclaims were not involved in the motion for summary judgment.

The District Court was of the opinion that the Engelbach patent was anticipated by the prior U.S. Patent 3,041,682 issued to Sterling Alderfer. The Alderfer patent had not been considered by the Patent Office when the Engelbaeh application was before it. The District Court was of the view that Alderfer was more pertinent than the prior art which the Patent Office did consider.

The District Judge further found that there had been a commercial sale and uses of the structure disclosed in claim 6 of Engelbaeh more than a year prior to the filing of the application for the patent, and that the patent was therefore invalid under 35 U.S.C. § 102(b).

On appeal, the principal issue raised by Avery was that there were genuine issues of material facts and that the District Court erred in granting Morgan’s motion for summary judgment. Bohn Aluminum & Brass Corp. v. Storm King Corp., 303 F.2d 425 (6th Cir. 1962). We disagree.

We have alluded heretofore to the extensive discovery which involved written interrogatories and written answers thereto, the requests for admissions and the answers, the patent in suit and the prior art patents, the depositions and exhibits. In addition, the parties made a joint response to a questionnaire submitted by the Court, entitled, “What Facts in the Matter are Not Actually in Dispute?” In the joint response it was agreed that Avery’s Division, Fasson Products, had made and sold, prior to March 29, 1960, structures containing nontacky layers of vinyl film, and a pressure sensitive adhesive having one side in adhering contact with the release coating and the second side in adhering contact with the vinyl. Also, it had made and sold other similar structures where the nontacky layer was either cellophane, polyethylene, cellulose acetate, or cellophane and polyethylene, instead of vinyl.

The District Court was careful to base its decision on uncontroverted or admitted material facts and we find no error in the disposition of this case by summary judgment. Rule 56, Fed.R.Civ.P.; Bobertz v. General Motors Corp., 228 F. 2d 94 (6th Cir. 1955), cert. denied, 352 U.S. 824, 77 S.Ct. 32, 1 L.Ed.2d 47 (1956). See also Ashcroft v. Paper Mate Mfg. Co., 434 F.2d 910 (9th Cir. 1970).

The Engelbaeh patent is on a “structure” and not on a method or process. Claim 6, which is the only claim in issue, states:

An adhesive structure as set forth in claim 5 wherein said nontacky layer is a heat activated layer which is convertible to provide said tacky adhesive surface by the application of heat.

Both parties refer to the patented structure as a “sandwich” with a pressure sensitive adhesive in the middle, which is protected by a removable piece of paper on one side called “substrate”, not firmly adhered thereto, and a layer of nontacky film on the face or opposite side. The nontacky layer is made tacky on its exposed surface by use of heat, so that it can be adhered firmly to another object. The removal of the paper or substrate permits the pressure adhesive • surface to be stuck to something else. Usually the structure is in the form of tapes or sheets. Avery claims novelty in the combination of two different sheeted adhesives in a true adhesive transfer. (Reply Brief, p. 8).

The prior art Alderfer patent, claimed to have anticipated Engelbaeh, disclosed sealing strips made as weatherstripping material for doors and windows. The adhesive attachment of the weatherstripping to doors and windows was made by a conventional vinyl film tape about % of an inch wide. The face of the tape was coated with vinyl film which was a nontacky layer. The opposite side of the vinyl film was coated with pressure sensitive adhesive to which was adhered a protective layer of paper or substrate which could be peeled off when the tape was applied for adhesion to a window frame or door. The vinyl film could be made tacky by applying heat so that the tape could be adhered to the weatherstripping material. In our opinion the District Court was correct in ruling that Engelbach was anticipated by Alderfer.

Alderfer initially used only vinyl and the pressure sensitive adhesive. Later Alderfer used vinyl and solvent. Engelbach also teaches the use of solvents.

Not only do we have a situation where Engelbach was clearly anticipated by Alderfer, but the fact is that the Fasson Division of Avery sold tapes with vinyl film to Alderfer more than one year prior to the filing of the Engelbach patent. It also sold such tapes to Vitronie, Inc. for attachment to its calendars and other novelties.

Avery asserts more uses for its invention than Alderfer did but such assertion, even if true, does not constitute invention.

Avery argues that vinyl is not a true adhesive; that vinyl can be adhered only to other vinyl, which is accomplished by the application of sufficient heat so that the vinyl melts and becomes welded to other vinyl. The District Court did not define the word “adhesive”; neither do we, as it is not necessary for our determination of the case.

The evidence was clear that the vinyl tapes purchased by Alderfer from Avery prior to the patent in suit were adhered to millions of feet of weatherstripping, and that the tapes purchased by Vitronic, Inc. from Avery were adhered to many thousands of its calendars and novelties.

Avery claims that it gets better adhesion with its structure than Alder-fer does; just how it does so is not clear. Avery has no patent on any process. The other materials which it uses were also used and sold prior to its patent application. We think that any improvement which it made was obvious to one skilled in the art. Engelbach’s alleged improvement of one part of an old combination confers no right to claim that improvement in combination with other old parts which perform no new function in the combination. Lincoln Eng’r Co. v. Stewart-Warner Corp., 303 U.S. 545, 58 S.Ct. 662, 82 L.Ed. 1008 (1938).

In sum, we agree with the District Court that the patent in suit was anticipated by Alderfer; that public sales or uses of the Engelbach adhesive structure were made by Avery more than a year prior to its patent application; and that any improvement which it made was obvious.

The judgment of invalidity is therefore affirmed. With respect to the cross-appeal taken by Morgan for protective purposes from the order dismissing its counterclaims, it is ordered that the cross-appeal be dismissed.

      . What is claimed is:
      1. An adhesive structure comprising a flexible substrate layer, a non-tacky layer, a pressure-sensitive adhesive having a first side in adhering contact with said substrate layer and a second side opposite said first side in adhering contact with said non-tacky layer, said non-tacky layer being convertible to a layer having a tacky adhesive surface on its side opposite said pressure-sensitive adhesive, the adhesion at one of said surfaces of said pressure-sensitive adhesive between said pressure-sensitive adhesive and the adjacent one of said layers being less than the adhesion at the other’ of said surfaces of said pressure-sensitive adhesive between said pressure-sensitive adhesive and the other one of said layers, said pressure-sensitive adhesive separating along said one surface thereof from the adjacent layer and remaining with said other adjacent layer when said layers are pulled apart.
      2. An adhesive structure as set forth in claim 1 wherein said non-tacky layer is a heat activated layer -which is convertible to supply said tacky adhesive surface by the application of a solvent.
      3. An adhesive structure as set forth in claim 1 wherein said non-tacky layer is a solvent activated layer which is convertible to provide said tacky adhesive surface by the application of a solvent.
      4. An adhesive structure as set forth in claim 1 wherein said non-tacky layer after being converted to provide a tacky surface is adapted to adhere to a surface of a body with an adherence sufficiently great to retain said non-tacky layer with said surface of said body when said substrate is pulled away from said body.
      5. An adhesive structure as set forth in claim 1 wherein the adherence between the surface of said pressure sensitive adhesive and said substrate is less than the adherence between the surface of said pressure sensitive adhesive and said non-tacky layer.
      6. An adhesive structure as set forth in claim 5 wherein said non-tacky layer is a heat activated layer which is convertible to provide said tacky adhesive surface by the application of heat.
      7. An adhesive structure as set forth in claim 5 wherein said non-tacky layer is a solvent activated layer which is convertible to provide said tacky adhesive surface by the application of a solvent.

      . It is interesting to note that while one of the assigned reasons for the appointment of the Special Master was the complexity of the case, the District Judge in his later opinion stated:
      In the instant case, the device in question is a relatively simple one, easily understood by a normally intelligent person without extrinsic expert evidence.
      The parties have raised no issue about the propriety of the appointment of the Special Master which is usually reserved for complicated accounting problems. The failure to make a timely objection to the appointment of a Master constitutes a waiver. First Iowa Hydro Elec. Coop. v. Iowa-Illinois Gas & Elec. Co., 245 F.2d 613 (8th Cir. 1957).