author: LOWELL, District Judge.

text:
    COMMISSIONER OF INTERNAL REVENUE v. OLD COLONY R. CO.
    No. 2515.
    Circuit Court of Appeals, First Circuit.
    June 10, 1931.
    Lionel A. Norman, Sp. Atty., Bureau of Internal Revenue, of Washington, D. C. (G. A. Youngquist, Asst. Atty. Gen., Sewall Key and Helen R. Carloss, Sp. Assts. to Atty. Gen., and C. M. Charest, Gen. Counsel, Bureau of Internal Revenue, of Washington, D. C., on the brief), for Commissioner.
    James S. Y. Ivins, of Washington, D. C. (Brewster, Ivins & Phillips, Kingman Brewster, and O. R. Folsom-Jones, all of Washington, D. C., on the brief), for Old Colony R. Co.
    Before BINGHAM and WILSON, Circuit Judges, and LOWELL, District Judge.
   LOWELL, District Judge.

This is an appeal by the Commissioner of Internal Revenue from a decision of the Board of Tax Appeals. The suit concerns income taxes for the year 1921 which the Commissioner contends are due from the Old Colony Railroad Company.

In 1893 the Old Colony leased its railroad lines to the New York, New Haven & Hartford Railroad Company, under an arrangement whereby the New Haven was to operate the railroad and pay a certain rental, including all taxes. Between 1893 and 1904 the Old Colony issued long-term bonds, which were sold at premiums amounting to $199,528.08. It kept its books on a cash payment basis until compelled by the Interstate Commerce Commission to keep them on an accrual basis.

The question to be solved in the case at bar is whether profit arising from the sale of the bonds may be taken into account in determining the expense to be allowed the Old Colony as a deduction. If the books were kept on a cash basis, the deduction allowable would be the interest paid on the bonds, and only that, as that would be the cash disbursement for the year. The Commissioner contends, however, that the real expense in connection with the payment of the interest on the bonds is the amount of it less an aliquot part of the profit, apportioned to the year 1921, amounting to $6,960.64, as the bonds cost the company less than the amount represented by the rate of interest.

There are no authorities precisely in point, and the decided eases in which somewhat similar questions arose relate to companies whose books were kept on a cash basis. See, for instance, Baldwin Locomotive Works v. McCoach (C. C. A.) 221 F. 59; Chicago & Alton R. Co. v. United States, 53 Ct. Cl. 41. But there is one decided ease which is the converse of the case at bar. In Western Maryland Ry. Co. v. Commissioner (C. C. A.) 33 F.(2d) 695, a corporation whose bonds were sold at a discount was allowed to figure the proportionate part of the discount as an expense for the year. The same principle applies to the ease at bar. If a corporation is allowed to show a greater expense for a given year by adding a proportionate part of a loss on the sale of bonds, there seems no reason to deny to the taxing authorities the right to show a smaller expense by deducting the proportionate part of a gain on a sale of bonds.

Such a result may seem contrary to the ease in this circuit of Commissioner v. Old Colony Railroad, 26 F.(2d) 408, which involved a similar state of facts. The decision was that a profit made in 1904, before the passage of the Sixteenth Amendment to the Constitution of the United States, could not be taxed. The court’s attention was not called to the fact that the profit made in the early years was not being taxed, but that it was being used only to determine the expense for the year 1921 of the payment of interest on the bonds. This is not a tax, but an allocation, under proper accounting methods for books kept on the accrual basis, of the expense chargeable to the year 1921. See Chicago, Rock Island & Pacific Ry. Co. v. Commissioner, 13 B. T. A. 989, 1029.

It may be true that the regulations of the Treasury Department (see article 332 of Regulations 74) are so framed as not to provide for amortization of premiums, but the Treasury regulations are founded on the law, and, if the law allows this to be done, the regulations cannot prevent it; a river can rise no higher than its source.

The ease of Commissioner v. Old Colony Railroad, ubi supra, is not inconsistent with the amortization of premiums for the purpose of ascertaining the expense properly chargeable to the year 1921. Compare, in this connection, Indiana Harbor Belt R. Co. v. Commissioner, 16 B. T. A. 279, with Terminal R. Ass’n v. Commissioner, 17 B. T. A. 1135, 1167.

The order or decision of the Board of Tax Appeals is reversed, and the ease is remanded to that Board for further proceedings not inconsistent with this opinion.


source: Caselaw Access Project

author: PER CURIAM.

license: Public Domain

text:
    NEW YORK UNDERWRITERS’ INS. CO. v. PORTWOOD.
    No. 9055.
    Circuit Court of Appeals, Eighth Circuit.
    June 10, 1931.
    Rehearing Denied July 11, 1931.
    C. Oscar Carlson, of Chicago, Ill. (Fenton Hume, of Kansas City, Mo., and Robert J. Folonie, of Chicago, Ill., on the brief), for appellant.
    Denton Dunn, of Kansas City, Mo. (Clif Langsdale, of Kansas City, Mo., on the brief), for appellee.
    •Before STONE and GARDNER, Circuit Judges.
   PER CURIAM.

This is an appeal from a judgment of damages for false arrest and imprisonment.

Heretofore, the bill of exceptions was stricken from the record because not settled or filed' within the term when the judgment became final nor within any extension made within-such term. The matter is presented upon the alleged error in denying the motion in arrest of judgment. The grounds of this motion were that the petition stated no .cause of action and no cause of action for punitive damages.

Here, appellant argues that the petition does not sufficiently aver the authority of the agent of appellant, which agent caused the arrest and imprisonment. The allegation in this regard in the petition is that one Loftus, “while acting within the scope of his said agency and undertaking to serve the defendant in connection with the said policy and the said loss, unlawfully, wickedly, 'falsely, maliciously and intending to oppress the plaintiff and to deprive her of her liberty, and to. bring shame and disgrace upon her, without warrant of law, arrested the plaintiff and deprived her of her. liberty in the said Johnson County, Kansas, and held her under arrest until the arrival of a constable of Johnson County, Kansas, whereupon the said Lof-tus, acting as aforesaid, unlawfully, wickedly, falsely, maliciously, and intending to oppress the plaintiff and to deprive her of her liberty, and to bring shame and disgrace upon her, caused her to be arrested by the said constable without warrant of law, and to be taken by the said constable to the office of said Breyfogle and Loftus in said Overland Park, Johnson County, Kansas, where the said Lof-tus, unlawfully, wickedly, falsely, maliciously and intending to oppress the plaintiff and to deprive her of her liberty, and to bring shame and disgrace upon her, caused her to be taken to jail and prison in the City of Olathe, Johnson County, Kansas, without warrant of law, and there to be imprisoned and detained until the afternoon of the 11th day of January, 1929', when she was released and discharged without any complaint or charge of any kind having been lodged or filed against her.”

Among other allegations, the answer contained the following: “Further answering, defendant denies the authority of said Loftus as agent of this defendant to arrest plaintiff or cause her to be arrested or imprisoned or deprived of her liberty and on the contrary alleges that said Loftus had no authority from this Company to arrest plaintiff 6r cause her to be arrested, deprived of her liberty or imprisoned and alleges that if the said Loftus arrested plaintiff or caused her to be arrested and deprived of her liberty or imprisoned, that said act was without any authority- from this defendant.”

There was no demurrer to the petition. Thus, the situation is that appellant made no challenge of the sufficiency of the petition; answered specifically the very matter which it now claims is not in the petition and after verdict, for the first time, challenges the sufficiency of the petition upon the very ground it answered and tendered issue upon. In this situation, the quoted portion of the petition is certainly sufficient against such motion. Baker v. Warner, 231 U. S. 588, 34 S. Ct. 175, 58 L. Ed. 384. To hold otherwise would be to allow appellant effectually to trap ap-pellee by accepting the petition.as sufficient until it had failed in its tendered issue of fact and then overturn the entire proceeding with the resultant expense, effort, and lost time of court and appellee. Justice is not administered in that manner.

The judgment is affirmed.


author: THOMPSON, Circuit Judge.

text:
    CAVAGNARO v. LATIMER.
    No. 4391.
    Circuit Court of Appeals, Third Circuit.
    June 25, 1931.
    Rehearing Denied July 31, 1931.
    Russell Fleming and Fleming & Handford, all of Newark, N. J., for appellant.
    Collins & Corbin, of Jersey City, N. J. (E. A. Markley, of Jersey City, N. J., of counsel), for appellee.
    Before BUFFINGTON, WOOLLEY, and THOMPSON, Circuit Judges.
   THOMPSON, Circuit Judge.

The appellant brought suit in the District Court for the District of New Jersey to recover damages for personal injuries received in a right angled collision between his automobile and that of the appellee. The assignments of error are based on the refusal of the trial judge to affirm eleven requests for charge at the conclusion of the evidence in the case.

The appellee raises a jurisdictional question based upon the fact that the printed transcript of record filed in this court, which we must presume to contain the entire reeord of what occurred in the court below, discloses that no bill of exceptions was presented, settled, or signed by the District Judge.

The object of a bill of exceptions is to put the decision objected to upon reeord for the information of the court having cognizance of the cause in error. Bills of exceptions were authorized by. Statute Westm. 2d (13 Edw. I) c. 31. It provides for compelling the judges to sign such bills, and for securing the insertion of the exceptions upon the reeord. Bouv. (Baldwin’s Rev.) 123.

That the necessity of a bill of exceptions in the federal courts is recognized by Congress is apparent from the language of the Act of June 5, 1900, § 1, Rev. St. § 953 (28 USCA § 776), which provides: “A bill of ' exceptions allowed in any cause shall be deemed sufficiently authenticated if signed by the judge of the court in which the cause was tried, or by the presiding judge thereof if more than one judge sat at the trial of the cause, without any seal of the court or judge annexed thereto.” Origet v. United States, 125 U. S. 240, 8 S. Ct. 846, 31 L. Ed. 743; Malony v. Adsit, 175 U. S. 281, 20 S. Ct. 115, 44 L. Ed. 163.

In the federal courts in actions at law, a bill of exceptions stating the rulings and the exceptions, settled and signed by the trial judge, is indispensable to the review of rulings upon requests for instructions to the jury. Morse v. Anderson, 150 U. S. 156, 14 S. Ct. 43, 37 L. Ed. 1037; Kinney v. U. S. Fidelity Co., 222 U. S. 283, 32 S. Ct. 101, 56 L. Ed. 200; Wyss-Thalman v. Maryland Casualty Co. (C. C. A.) 193 F. 53.

The reeord filed in this court contains merely the pleadings, the stenographer’s notes of the testimony, and rulings of the trial judge at the trial, and is entirely devoid of any showing that the proceedings were incorporated in a bill of exceptions drawn up and settled in proper form and signed by the judge of the court below. It is apparent, therefore, that no lawful reeord is before this court. The appeal, therefore, must be •dismissed.

Appeal dismissed.


author: FOSTER, Circuit Judge.

text:
    WILLIAM BAYLEY CO. v. COLUMBIA CASUALTY CO.
    No. 6063.
    Circuit Court of Appeals, Fifth Circuit.
    June 22, 1931.
    Peyton T. Jordan, of Tampa, Fla., for appellant.
    M. W. Wells, of Orlando, Fla., for appel-lee.
    Before FOSTER, SIBLEY, and HUTCHESON, Circuit Judges.
   FOSTER, Circuit Judge.

Appellant brought suit to recover on a building contractor’s bond executed by appel-lee as surety. A demurrer setting up no cause of action was' sustained to the complaint, and the suit was dismissed.

The complaint alleges that, subsequent to the execution of the contract and bond, appellant, as a subcontractor, furnished certain casements and windows to the contractor, on which a balance of $3,378.80 is due; that they were approved by the architect and were used in the construction of a sehool building for the St. James Roman Catholic parish, 'as provided by the contract.

As to the contract and bond, .the allegations are these:

The Right Reverend Patrick Barry, bishop of St. Augustine, entered into a written contract with the Louis Fl'eisher Construction Company on June 25, 1928, for the building of a school for St. James, Roman Catholic parish, Orlando, Fla., for the sum of $94,-056. The contract required the contractor to give an acceptable corporate bond of surety-ship, in the standard form of the American Institute of Architects, to the amount of 100 per cent, of the contract, and providing that the said bond should include provisions for the protection of subcontractors and those furnishing labor and materials or supplies to the contractor on the work.

The contractor furnished the required bond, with itself as principal and the Columbia Casualty Company as surety, with the following condition: “If the principal shall faithfully perform the contract on his part, and satisfy all claims and demands incurred for the same, and shall fully indemnify and save harmless the Owner from all cost and damages which he may suffer by -reason of failure so to do and shall fully reimburse arid repay the Owner all outlay and expenses which the Owner may incur in making good any such default, and shall pay 'all persons who have contracted direetly with the Principal for labor or materials, then this Obligation shall be null and void; otherwise it shall remain in full force and effect.”

Our inquiry is very much simplified, by the recent decision of the Supreme Court of Florida in the ease of Johnson Electric Co. v. Columbia Casualty Co., 133 So. 850, which construes the identical contract and bond declared on in this case. The decision of the Supreme Court of Florida holds that • the bond was written in favor of furnishers of labor and materials to the contractor, and that such laborers and contractors have a right of action in their own names on the bond. The decision is well considered and persuasive, and we have no- hesitancy in following it. This conclusion is supported by the following cases: American Surety Co. v. Smith (Fla.) 130 So. 440; Hendrick v. Lindsay, 93 U. S. 143, 23 L. Ed. 855.

It follows that it was error to sustain the démurrer.

.Reversed and remanded.


author: PAGE, Circuit Judge.

text:
    GRESHAM v. LESLIE et al.
    No. 4542.
    Circuit Court of Appeals, Seventh Circuit.
    June 25, 1931.
    Rehearing Denied July 20, 1931.
    Otto Gresham, of Chicago, Ill., pro se.
    Richard P. Tinkham and C. B. Tinkham, both of Hammond, Ind., for appellees.
    Before EVANS and PAGE, Circuit Judges, and LINDLEY, District Judge.
   PAGE, Circuit Judge.

The District Court sustained a demurrer and dismissed appellant’s complaint charging that appellees, as officers of the Lower House of the Indiana Legislature, had damaged him by reason of their refusal to permit action by the -Lower House upon a petition presented by appellant. When filed, the petition was said by appellant to be one for the impeachment of two Indiana circuit court judges, and, fairly considered, it is nothing more. Several times the Supreme Court.of Indiana in construing the Constitution and statutes of that state has held that its Legislature is without power to impeach circuit judges. State v. Patterson, 181 Ind. 660, 105 N. E. 228; State v. Redman, 183 Ind. 332, 109 N. E. 184; State v. Dearth, 201 Ind. 1, 164 N. E. 489.

We are bound by that court’s interpretation of the laws of the state. Slaughter House Cases, 16 Wall. 36, 21 L. Ed. 394; Douglas v. Noble, 261 U. S. 165, 43 S. Ct. 303, 67 L. Ed. 590; Isaacs v. McNeil (C. C.) 44 F. 32, 11 L. R. A. 254.

Affirmed.


author: NETERER, District Judge

text:
    GEORGIA CO. v. RICHFIELD OIL CO. THE KEKOSKEE.
    No. 12989.
    District Court, W. D. Washington, N. D.
    Nov. 21, 1930.
    See, also, 47 F.(2d) 235.
    Stratton & Kane, of Seattle, Wash., for libelant.
    Huffer, Hayden, Merritt, Summers & Bucey, of Seattle, Wash., for respondents.
   NETERER, District Judge

(after stating the facts as above).

Compensation for services in rendering assistance to a ship at sea or her eargo, or both, from impending sea peril, when successful and voluntary, is a maritime lien upon the ship or eargo, or both and may be impressed in rem (Admiralty Rule 18 [28 USCA § 723]); and, where the owners or underwriters employ such services, proceedings-in personam against the employer may be had. The Sabine, 101 U. S. 384, 25 L. Ed. 982. There is no authority to proceed against the ship in rem and in personam against1 the employers in the same libeL The Sabine, supra.

A court of admiralty has no equity jurisdiction, and cannot afford equitable relief in a direct proceeding. United States v. Cornell Steamboat Company, 202 U. S. 184, 26 S. Ct. 648, 50 L. Ed. 987. Even though in good conscience libelant should be paid for salving the cargo-, the court is impotent in this proceeding. The ship and the cargo bear separate relations, and must contribute to the services performed in respect to benefit received. A ship is not liable for the proportion of salvage due from her cargo. The Alaska (D. C.) 23 F. 597; Stone v. Jewell (D. C.) 41 F. 103. See, also, The Admiral Evans (D. C.) 286 F. 442. And it is immaterial that the cargo was owned by the owner of the vessel.

The ship and cargo have not common status. Each has a separate underwriting and other relations, although the ownership may be common. _ The ship has preferred mortgage status (sections 922-953, tit. 46, USCA), which would be imperiled by cargo salvage claim, and the integrity of preferred security by bona fide holders would be impaired. While there is no Evidence of such lien, the rule would have general application, and it would be manifestly inequitable and would create confusion, and is beyond the court’s power to change the existing status and engraft on the procedure, against rule and admiralty practice or precedent, personam claim for cargo salvage, upon this record, in a proceeding in rem against the ship.

Exception sustained, and that part stricken.


author: THOMAS, District Judge.

text:
    UNITED STATES ex rel. PARENTI v. MARTINEAU, Immigration Inspector, et al.
    No. 3416.
    District Court, D. Connecticut.
    May 5, 1930.
    Anthony P. Arpaia, of New Haven, Conn., for petitioner.
    John Buckley, U. S. Atty., and George H. Cohen, Asst. U. S. Atty., both of Hartford, Conn., for the defendants.
   THOMAS, District Judge.

By a writ of habeas corpus, the petitioner seeks to test the validity of a warrant for his deportation to Italy.

The respondent has filed a return to the writ which shows that the petitioner is a native and subject of Italy, and that he arrived in this country about July 1, 1905. The return further shows that on November 20, 1918, the petitioner wa-s found guilty of theft, and sentenced by the judge of the police court for the city of Meriden to the Connecticut Reformatory at Cheshire for an indeterminate period, and remained there for two years; that subsequently, having entered the United States Army, he was arrested by the military authorities on a charge of larceny — tried by court martial, convicted, and sentenced to one year of imprisonment. It is further alleged that on September 15-, 1927, the petitioner pleaded to a charge of statutory burglary in the superior court at Bridgeport, and was sentenced to one and one-half to three years in the Connecticut State Prison, which sentence he has recently completed.

On November 27, 1928, a warrant for his deportation was issued directing his deportation to Italy on the ground that subsequent to May 1,1917, he was sentenced to imprisonment more than once for a term of one year or more for the commission, subsequent to his entry, of crimes involving moral turpitude, to wit, theft and statutory burglary.

To the return of the respondent no- traverse was offered. Therefore the question presented is one of law based upon the conceded facts set forth in the return.

The petitioner suggests that his sentence to the reformatory at Cheshire was not a sentence for the period of one year or more. The return, however, shows that the sentence was for an indeterminate period, and that the petitioner actually served two years. What the maximum term of an indeterminate sentence is, under the Connecticut statute, does not appear, but I must assume that it is at least two years, in as much as the petitioner served that length of time. Under the Connecticut statute, however, it was competent for the hoard of parole to release the petitioner on parole after he had served six months.

It seems to me that, when a person has been sentenced for an indeterminate period, for the purpose of the Immigration Act, the period of his sentence is to be determined, not by the possible minimum, but rather by the possible maximum, during which he is liable to have to serve, for there is always a possible minimum of one day not only under the specific statute, hut under the statutes lodging power of commutation in the executive. If the possible minimum sentence is to measure the liability to deportation of an immigrant, then section 19 of chapter 29 of the Act of 1917 (8 USCA § 155) is of no force and effect, for, as has already been observed, under the statute lodging commutative power in the executive the possible minimum of any sentence may be less than a day. I therefore hold in consonance with United States ex rel. Sirtie v. Commissioner of Immigration (D. C.) 6 F.(2d) 233, that the possible maximum of any' sentence is the criterion by which to determine whether or not one has been sentenced for a period of one year or more.

The petitioner further suggests that the crime for which he was sentenced to the reformatory at Cheshire did not involve moral turpitude. I consider larceny as an offense involving moral turpitude. Bartos v. United States District Court for District of Nebraska (C. C. A.) 19 F.(2d) 722; United States ex rel. Ulrich v. Kellogg, 58 App. D. C. 360, 30 F.(2d) 984, 986, 71 A. L. R. 1210. The fact that the petitioner stole the money from his mother does not, as I see it, serve to diminish its gravity.

It follows from this that it is unnecessary to determine what effect petitioner’s sentence by court martial has upon these proceedings, as it is obvious that, irrespective of this sentence, the petitioner has been convicted more than once of a crime involving moral turpitude and sentenced more than once to a term of one year or more of imprisonment.

The writ is therefore dismissed, and the prisoner remanded, and an order to this effect may be submitted to the court on May 21, 1930, at 10:30 a. m. (daylight saving time), at New Haven, at which time the petitioner’s request for a thirty-day stay' will be considered.


author: OTIS, District Judge.

text:
    UNITED STATES v. DAVIS et al.
    No. 1358.
    District Court, W. D. Missouri, S. D.
    Sept. 30, 1930.

      Harry L. Thomas, Asst. U. S. Atty., of Kansas City, Mo., for the United States.
    Milo A. Lang, of Joplin, Mo., Allen McReynolds, of Carthage, Mo., and George B. Lang, of Joplin, Mo., for defendants.
   OTIS, District Judge.

On January 20, 1920, the A. L. Davis Lumber Company sold all of its assets, in the same year liquidated, and was dissolved December 30, 1920. Prom the sale of its assets it realized a net gain of $54,045.01, reduced to money January 20,1920. On January 30, 1920, a dividend in the amount of $60,000 was paid the stockholders. Of this amount $54,045.01 was the gain realized from the sale of assets on January 20, 1920.

1. If the $60,000 dividend of January 30, 1920, is deducted from the capital and surplus for the year 1920, the taxable income of the company is proportionately increased for that year, and the additional tax demanded in count II of plaintiff’s petition is eoneededly legally due. The whole controversy here is as to whether it was properly so deducted.

Section 201 (e) of the Revenue Act of 1918, 40 Stat. 1060, provides that “Any distribution made during the first sixty days of any taxable year shall be1 deemed to have been made from earnings or profits accumulated during preceding taxable years. * * * V

Now, the fact is that of the $60,000 distributed January 30, 1920 (and therefore within the first sixty days of 1920), $54,045.-01, was not “from earnings or profits accumulated during preceding years” but was a profit realized in 1920. Must it be conclusively presumed, despite the fact, that the distribution of the $54,045.01 referred to was from earnings or' profits accumulated during preceding years'? The answer depends on the meaning of the word “deemed” as used in the statute. If that word is equivalent to “conclusively presumed,” the plaintiff must prevail. On the other hand, if, as defendants argue, it means no more than “supposed” or “presumed until the contrary is shown,” the defendants should have judgment.

My view is that the construction contended for by plaintiff is the right one. I can add nothing to what was said by Judge Cooper of the Northern district of New York in Harder v. Irwin, Collector (D. C.) 285 F. 402, as to the true meaning of the word. It was held by him that the word “deemed” must be construed as raising a conclusive presumption.

2. Defendants suggest in briefs that if the statute is so construed it is invalid. The issue of constitutionality, however, is not raised in the answer (a mere general denial) and I do not consider it. 12 Corpus Juris, 784.

3. The liability of the defendants is not affected by the fact that this is a proceeding in equity. Their liability is determined by the statute. Whether in law or equity the meaning of the statute is the same.

I find the facts to be as stipulated by the parties, and conclude from them, as a matter of law, that the defendants are liable as to both counts for the amounts prayed, with interest. An appropriate decree may be submitted for approval and entry.


author: PATTERSON, District Judge.

text:
    HEEBNER v. UNITED STATES.
    District Court, S. D. New York.
    March 26, 1931.

      Donald Home, of New York City, for plaintiff.
    George Z. Medalie, U. S. Atty., of New York City (Leon E. Spencer, of New York City, of counsel), for the United States.
   PATTERSON, District Judge.

The action is to recover excess-profits tax paid by the plaintiff on June 12, 1923. It was commenced on April 18, 1930. The defendant moves to dismiss the complaint on the ground that the action is barred by limitation. Under section 1113 (a) of the Revenue Act of 1926 (26 USCA § 156), no suit may he brought to recover any internal revenue tax more than five years after payment, unless the claim has been disallowed and suit is brought within two years after disallowance of the plaintiff’s claim for refund.

The plaintiff filed claim for refund on June 9, 1927. By letter dated February 26, 1928, the Commissioner of Internal Revenue notified him that the claim would be rejected, and that the rejection would officially appear on the next schedule to be approved by the Commissioner. The rejection was accordingly listed on the schedule approved March 9, 1928. The plaintiff on October 29, 1928, filed a brief requesting a reopening of the matter. The Commissioner declined to change his ruling, and so notified the plaintiff in a letter dated April 9, 1929. This letter, setting forth brie|y the view of the facts taken by the Commissioner, and stating that the tax had been correctly computed, concluded: “The conclusions expressed in Bureau letter dated February 12, 1928 are therefore affirmed.” The plaintiff then filed a second claim for refund covering the same tax, and on February 28, 1930, the Commissioner informed him by letter of the forthcoming rejection of this claim.

The significant date here is March 9, 1928, when the original claim for refund was formally disallowed. The two-year period then began to run, and no further notice to the plaintiff was necessary. United States v. Michel, 282 U. S. 656, 51 S. Ct. 284, 75 L. Ed. -, decided by the Supreme Court on February 24, 1931. The time to commence suit therefore expired on March 9, 1930, and an action brought on April 18, 1930 was too’ late.

The plaintiff does not urge that a new lease of life was won by the second claim for refund and its rejection. He does contend,' however, that the first claim for refund was reopened and was not finally rejected until April 9, 1929. Support for this contention may come by analogy from the rule that a motion for new trial or a petition for rehearing, if seasonably made, extends the time for application for appeal until the motion or pe<tition is disposed of. Aspen Co. v. Billings, 150 U. S. 31, 14 S. Ct. 4, 37 L. Ed. 986; Kingman & Co. v. Western Mfg. Co., 170 U. S. 675, 18 S. Ct. 786, 42 L. Ed. 1192. But it seems to me that the result here is different. A regulation of the Treasury Department which took effect six days before the. plaintiff filed his brief for reconsideration of the claim for refund provides that no application for reopening will extend the period within which suit must be brought, and that reconsideration of a claim by the Commissioner will not be deemed a reopening. Article 1257, effective October 23, 1928. It will be noted that this regulation is applicable only to eases where claims have already been definitely disallowed by the Commissioner. It is not repugnant to any statute, so far as appears, and, in my opinion, it is a valid and proper regulation, serving the useful purpose of removing uncertainty as to the effect of an application for reconsideration of a rejected claim. The plaintiff argues that the words used in the Commissioner’s letter of April 9, 1929, indicate that the claim for refund was reopened and reconsidered on the merits. It is not necessary to pass upon this point, because, under the controlling regulation, this communication to the plaintiff could not have the effect claimed for it by the plaintiff. It follows that the plaintiff, when he filed his. application for reconsideration, was put on notice that the period of limitations two years from March 9, 1928, continued to run without interruption.

The complaint will therefore be dismissed.


author: MORTON, District Judge.

text:
    UNITED STATES v. DEAN.
    No. 9869.
    District Court, D. Massachusetts.
    May 27, 1931.

      Frederick H. Tarr, TJ. S. Atty. and Elihu D. Stone, Asst. U. S. Atty., both of Boston, Mass., for plaintiff.
    Benjamin F. Evarts, of Holyoke, Mass., for defendant.
   MORTON, District Judge.

This is a motion to suppress evidence obtained on a search without a warrant of the defendant’s premises.

The facts are as follows: The defendant, Deán, is a farmer, and lives on his farm in Adams, Mass. The buildings are about six hundred feet from the highway, and are reached by a private way. They consist of a dwelling house and a garage about fifty feet apart. Suspecting that illegal distillation was going on there, federal and state officers drove to the place on the night in question and went into the yard. Either in the private road or in the yard, the officers smelled odors of distillation or of mash. Dean was at home; he refused to give the officers permission to enter the garage, which was dark and was locked, saying he had leased it to one Denhy. The officers thereupon broke the lock and entered. It contained distilling apparatus and two automobiles which belonged to Dean. The officers searched the building and ordered Dean to appear before the United States commissioner on the following morning. No arrest was made at that time. On the evidence so obtained, Dean has been indicted for manufacturing intoxicating liquor and possessing property designed for that purpose.

The search was clearly illegal. Officers have no right to enter private buildings without legal justification. Where officers have knowledge that a person in the building is in the act of committing a felony, or possibly a misdemeanor, they may enter without a warrant in order to arrest him and to suppress the crime, and they may enter to arrest a person against whom a warrant is out or who is reasonably suspected of having committed a felony. I am aware of no other eases in which officers are justified in forcing an entrance without a warrant into private property. These principles have been so often stated that a citation of authorities is perhaps unnecessary, but the following may be referred to: Amos v. U. S., 255 U. S. 313, 41 S. Ct. 266, 65 L. Ed. 654; Raniele v. U. S., 34 F.(2d) 877 (C. C. A. 8); Temperani v. U. S., 299 F. 365 (C. C. A. 9); U. S. v. Di Corvo (D. C.) 37 F.(2d) 124 (discussing eases); Russell v. State, 37 Okl. Cr. 71, 256 P. 758.

The only special circumstance in the present case which calls for notice is that Dean at first claimed to the officers that he had leased the garage and did not have present possession or control of it. The government contends that he is not, therefore, in a position to question the legality of the search. The indictment, however, involves an assertion that the property was in the possession or control of Dean. The government cannot maintain that he was the owner of the property for the purpose of convicting him and was not the owner for the purpose of searching it. Even if Dean put his objection to the search on a false ground, as the government claims, the search was nevertheless against his will and consent. There is nothing to indicate that he so phrased his refusal of permission to search as to waive other legal grounds of objection than that which he stated.

Motion allowed.


author: DICKINSON, J.

text:
    VITAGRAPH, Inc., v. THEATRE REALTY CO., Inc.
    No. 15712.
    District Court, E. D. Pennsylvania.
    April 28, 1931.
    Cohen, Schweidel & Krekstein, of Philadelphia, Pa., for plaintiff.
    George P. Aarons, of Philadelphia, Pa., for defendant.
   DICKINSON, J.

The general fact situation is that the plaintiff is what is known as a distributor of motion picture films, and the defendant is an exhibitor of such pictures. The parties entered into a contract, the one to supply films and the other to pay for them. It is out of this contract that the questions to be now ruled arise. The question raised by the statutory demurrer is the very broad one of 'whether or not the contracts sued upon are Void as against public policy, in that they are condemned by the act of Congress known as the Sherman Act (15 USCA § 1 et seq.). A primary question is suggested of whether the ease is ripe for an adjudication upon the above question of whether the contracts are enforceable. This primary question is not whether the contracts will be found to be unenforceable when the facts upon which this judgment is based are developed, but the other question of whether we can assume the facts upon which a condemning judgment of the law would be based. This brings the primary question down to that of whether the demurrer is a speaking demurrer. The underlying question is, however, one which must be met and can be met as well now as at the trial of the case. We will, in consequence, assume a submission of the question by the parties upon the facts.

The plaintiff concedes that the contract is unenforceable in some of its features, but asserts that, notwithstanding this, the plaintiff may recover the contract price of the films which were supplied and accepted and used by the defendant. The fact appears on the face of the pleadings in their present state that films were thus supplied by the plaintiff, were accepted, and were used by the defendant. If this were the sole fact, the plaintiff would have a right of action on an implied assumpsit to pay the fair value of what was thus furnished and accepted. It would thus seem to follow that the only function of the contract is to change the cause of action from a quantum meruit to a contract price basis of recovery.

The experienced counsel for the plaintiff, starting with the admission that the contract in some of its features is inimical to the law and therefore void, urges that the “entire contract is not thereby void so as to preclude a recovery for a breach of its other provisions.” Several cases are cited in support of this distinction. The distinction as sueh is undoubtedly sound, but it does not reach the real issue here. The contract calls upon the defendant, not merely to pay for the films, but to pay for them at the contract price. Had the defendant agreed to pay that price, the obligation would be clear. The defense set up, however, is that the defendants never so agreed. When confronted with the writing averred in the statement of claim to be the contract of the defendant, it says it is not its contract because it is nothing, being avoided by the policy of the law. The real defense is to be found in the feature that the plaintiff is in a position to control the trade of its customers. It says, in effect, you must sign this contract on the dotted line or go out of business. A contract includes the-thought of the freedom of the contracting parties. It would be farcical to speak of freedom under such conditions. The proposition is, therefore, simply that a plaintiff cannot enforce a contract which is void because condemned by the law. We do not wish to be understood as laying down the proposition that a defendant who has, on request, been supplied with something of value can successfully set ujo the defense of a refusal to pay anything because the purchase transaction is evidenced by a contract containing features which are unenforceable for the reason above stated. Whether the purchaser would be liable on a quantum meruit is a question not now before us, and hence not ruled. The sole question now raised is whether the plaintiff can enforce a contract which is not enforceable at law or in equity. The ruling made is that it cannot. So far as we have noticed, the statement of claim bases the cause of action wholly upon the contract, and it follows that if there is no contract the cause of action is without support.

We limit ourselves at this stage of the proceedings to the finding that the question of law raised by the demurrer should be decided in favor of the defendant. We do not enter judgment, because the plaintiff may ask leave to amend the statement of claim. The ruling made, moreover, is made upon the assumption that the facts upon which the contract has been condemned as one in violation o'f the Sherman Act are admitted by the plaintiff. Unless they are so admitted, they must be set up by an affidavit of defense to the fact merits of the plaintiff’s claim, or otherwise brought upon the record. Counsel will doubtless be able to agree upon a form of order which will meet the situation. If they are not so able to agree, we will enter an appropriate order.

Leave to submit a formal order in accordance with this opinion is granted.

PER CURIAM.

And now, May 12, 1931, in accordance with the opinion filed, the court refuses to find the questions of law raised in favor of the defendant, because the facts upon which a ruling must be based do not appear of record. The defendant has leave to file an affidavit of defense to the fact merits within fifteen days, in -accordance with the Pennsylvania Practice Act of 1915 (P. L. 483, § 12 [12 P. S. § 411]).


text:
    METRO-GOLDWYN-MAYER DISTRIBUTING CORPORATION v. BIJOU THEATRE CO., Inc., et al. EDUCATIONAL FILM EXCHANGES, Inc., v. SAME.
    Nos. 3254, 3255.
    District Court, D. Massachusetts.
    May 11, 1931.
    Hill, Barlow & Homans, of Boston, Mass., for plaintiffs. -
    John C. Coughlin, of Boston, Mass., for defendant.
   MORTON, District Judge.

These áre bills in equity to enjoin alleged infringements of copyright on certain moving picture films and for damages. - The- defendant has moved to dismiss- on several1 grounds.

The first ground, that the plaintiff has brought suits against these defendants in the state court which are now pending, is disposed of by McClellan v. Carland, 217 U. S. 268, 30 S. Ct. 501, 54 L. Ed. 762. See too Consolidated Ordnance Co. v. William T. Marsh et al., 227 Mass. 15, 116 N. E. 394. The second ground argued is misjoinder of parties, the objection being that the exclusive licensee of the owners of the copyright is joined as a party-plaintiff. Inasmuch as it has an interest in the litigation, it has properly been made a party-plaintiff to the suit under Equity Rule 37 (28 USCA § 723). The third ground is that no case is shown for an injunction because there is no allegation of continued or threatened infringement and that, there being no case for injunctive relief, the equity of the bill fails. The answer to this is found in the statute (17 USCA § 25), which provides that a suit for damages may be combined with one for an injunction. It follows that though the injunction be denied the case may stand as one for damages.

The other grounds are more basic and important, viz., that the unauthorized showing of a motion picture does not constitute a violation of the copyright on it; and that the plaintiff, having turned over the films in question to the defendant under a contract regulating the use of them and providing for arbitration of disputes as a condition .precedent to legal action, cannot sue without complying with the terms of the contract, nor maintain an infringement proceeding for acts amounting to a breach of the contract.

As to whether showing a copyrighted motion picture film constitutes an infringement of the copyright: This question seems not to have been decided in any case in whieh an opinion was written. There is no provision in the statute concerning the scope or effect of the copyright of moving picture films. They were commercially unknown when section 1 of the current act was passed (1909) and are referred to only in the classification section of the statute, being brought in there by the amendment of 1912;. As the statute does not in terms give to the proprietor of the copyright the rights contended for by the plaintiff, the question is whether such rights ■are conferred by the general provisions of section 1, or by implication from those provisions. The only case whieh throws much light on the matter is Kalem v. Harper Bros., 222 U. S. 55, 32 S. Ct. 20, 56 L. Ed. 92, Ann. Cas. 1913A, 1285, where it was held that the exhibition of a motion pieture.hased upon a dramatization of a copyrighted novel was a dramatic production within the meaning of the copyright law, and consequently was an infringement of the copyright on the novel, because by the statute the copyright owner is given exclusive control of dramatization and dramatic performance of his work. The point decided was as to the scope of the copyright on the novel “Ben Hur.”

The present question is different. Here the film itself is the subject of the copyright. Nobody questions that the plaintiff has the exclusive right to control copying it. If the film were an ordinary photograph or transparency, nobody would contend that the mere exhibition of it violated the copyright. The understanding of Congress that it does not do so in the ease of a moving picture film is established with very unusual clearness. The point was explicitly raised and discussed in connection with the amendments of 1912. During the debate on them in the House, apprehension was expressed lest the exhibitor be made liable as an infringer of the copyright; and the following colloquy occurred :

Mr. Borland: “Would not the gentlemen be willing to consent then that the penalty should apply against the men who made the film?”
Mr. Townsend (who was in charge of the bill): “That is the intention of the law.”
Mr. Borland: “And that the exhibitor should not be liable for an innocent infringement?”
Mr. T'ownsend: “That was the understanding of the lawyers on the Committee.”

The rather lengthy discussion from which this excerpt is taken makes it clear that the House.understood that neither under the,existing law, nor under the proposed amendment, was an unlawful exhibition of the copyrighted film, an infringement of the copyright. It should require unambiguous language in a statute to the contrary to warrant disregarding such clearly proved legislative intent.

The only part of section 1 whieh can possibly be regarded as having that effect, as it seems to me, is clause (d) relating to “drama” or “dramatic work.” If the film itself be regarded as a drama, the Kalem decision applies. The provisions about “drama” -and “dramatic work” in this section go back to the Act of 1856 and relate to the written and spoken drama as then known. They have since been revised and extended, the last time in 1909, when as above stated moving pie* tures were still unknown commercially. No* body -then thought of “drama” or “dramatic work” in terms of motion pictures. A moving picture play is utterly different from anything then conceivable — -an entirely new method of communicating ideas. •

Copyright statutes were originally intended to control copying. See Bobbs-Merrill Co. v. Straus, 210 U. S. 339, 28 S. Ct. 722, 52 L. Ed. 1086; Jeweler’s Circular Pub. Co. v. Keystone Pub. Co., 281 F. 83, 26 A. L. R. 571 (C. C. A. 2). Until Kalem Co. v. Harper Bros., 222 U. S. 55, 32 S. Ct. 20, 56 L. Ed. 92, Ann. Cas. 1913A, 1285, the development of copyright law had been strictly statutory; it had not been extended by judicial enlargement of existing law. Statutes were required to give authors of dramatic works a monopoly of the spoken performance of them (Act of August 18, 1856 [11 Stat. 138]), and to give composers control of public performances of their music or operas. The Mikado Case (C. C.) 25 F. 183, 187; 17 USCA § 1 (e). When mechanical instrumentalities were invented to reproduce music and sound, statutory action was again necessary in order to protect composers; it being held that the copyright on the printed music did not give a monopoly of audible reproduction of it by perforated rolls. White-Smith Music Pub. Co. v. Apollo Co., 209 U. S. 1, 28 S. Ct. 319, 52 L. Ed. 655, 14 Ann. Cas. 628. There are now special provisions in the statute dealing with talking-machine records (section 1, e), and also special provisions concerning infringement by mechanical reproduction which is, however, limited to musical works (section 25). As a general rule, the effect of a new invention in any given field seems to be a matter for legislative consideration, rather than for the extension of existing statutes by judicial construction. Cases supra; and see McBoyle v. United States (March 9, 1931), 51 S. Ct. 340, 341, 75 L. Ed. ——, where the Dyer Act (18 USCA § 408), relating primarily to stolen motor vehicles, which by its terms included “any other self-propelled vehicle not designed for running on rails,” was held not to apply to airplanes. I do not understand that the Kalem Case supra, and Buck v. Jewell-La Salle Realty Co. (April 13, 1931) 51 S. Ct. 410, 75 L. Ed.-, repudiate this historic approach to such questions.

-While old language will often apply >to unforeseen conditions and that of section 1 has much breadth, I do not think that a moving picture film can be regarded as having the copyright privileges of a “drama” or “dramatic work” within this subsection, in the face of an obvious intent to the contrary by Congress, nor that the mere exhibition of it infringes the copyright. The opposite conclusion would work a discrimination between films which are dramatic in character, and others, e. g. of sports, explorations, news, etc., which are not, and would put into the hands of the copyright owner powers which might be very oppressively used- — a possibility which was suggested during the debate in Congress and is well illustrated by Metro-Goldwyn-Mayer Distributing Corp. v. Zotos (Eastern District of Missouri, 3 July 1930), referred to in a brief submitted for the plaintiff, where, in a case like the present, damages of over $13,000 were awarded against the defendant, while the rental for his unauthorized use of the films would have ^mounted to only $186.

The next question is whether, assuming that an unauthorized exhibition of a copyrighted film would be a violation of the copyright, the plaintiff is precluded from maintaining this suit for infringement because of the contract which it made with the defendant. The contract is referred to in the bill and is brought into the case in its complete form by stipulation. It provides for the furnishing of films by the plaintiff to the defendant and licenses the use of them on the terms and conditions therein stated; and it includes elaborate provisions for arbitration of all disputes arising between the parties to it, compliance with which is by its terms made a condition precedent to any right of legal action. It appears to be substantially the same contract which was before the Supreme Court in Paramount Famous Lasky Co. v. U. S. (November 24, 1930), 282 U. S. 30, 51 S. Ct. 42, 75 L. Ed. 145, and the arbitration clauses of which were there held to be illegal under the Sherman (15 USCA §§ 1-7, 15) and Clayton Acts (38 Stat. 730).

It is, of course, well settled that an illegal part of a contract may be so separable from the rest of it that the other provisions can still be enforced. Whether they are so separable is a question of fact. In Paramount Famous Lasky Corp. v. National Theatre Corp. (C. C. A. 4th, April 13, 1931) 49 F.(2d) 64, it was held that the arbitration provisions of the contract in question were of this separable character, and that the decision they were illegal — which rendered performance of them impossible — excused both parties from performing them. It has long been the custom of this circuit for courts of first instance to follow the decision of a Court of Appeals unless convinced that it was cleax-ly wrong. As applied to the facts in this case, that decision leads to such an unjust result as to throw doubt upon its soundness, and to indicate strongly that the arbitration provisions were not a separable part of the contract. While I should have reached the opposite conclusion, the decision does not, however, seem to me so clearly wrong as to warrant my refusal to follow it. I therefore hold that the arbitration provisions do not bar the plaintiff from maintaining the present suit.

The final question is whether a copyright owner, who has entered into a complete contractual arrangement with another person for the use by the latter of the copyrighted matter, can invoke against the other party to the contract the penalties of infringement of copyright for what is really only a violation of contract.

I had occasion recently to consider a somewhat similar point, viz., whether a patentee who had obtained a decree and an injunction against a defendant, and had thereafter licensed the defendant under the patent, could maintain that violations of the license agreement made the defendant an infringer and in contempt of the injunction. Upon a careful examination of the law, I held that as the parties had seen fit to put their arrangements on a contractual basis, the plaintiff was not entitled to use the club of the injunction to punish the defendant for breach of contract. American Pastry Products Co. v. United Products Co. (D. C.) 39 F.(2d) 181, and eases cited. The same reasoning is applicable here. The copyright statutes are designed to protect authors and composers against piratical appropriation of their work. They ought not to he used as a means of imposing severe penalties on a licensee for violation of a contract — especially where, as here, the license agreement contained an arbitration clause relieving from such penalties. There are many provisions in the contract which might be violated by an exhibitor, and the plaintiff’s contention if sustained would open the door to great abuses. All damages suffered are, of course, recoverable under the contract.

To permit the plaintiffs to recover would be deeply inequitable. Such a result would in effect recognize the injunction against the plaintiffs in the government suit not only as an excuse for their nonperformance of the arbitration clause by which the exhibitor was assured reasonably fair business treatment, but also as relieving them of the entire contract; and it would permit the plaintiffs after having put their relations with the defendant on a contractual basis to repudiate because of their own misconduct the contract— on which they can still sue even if Paramount Famous Lasky Corp. v. National Theatre Corp., supra, be sound — under which recovery would be limited to actual damages, and to obtain in lieu thereof the very large penalties which the statute provides for infringement.

Bills dismissed, with costs.

       No opinion filed.


author: WILLIAM C. COLEMAN, District Judge.

text:
    TIFFANY PRODUCTIONS, Inc., v. DEWING et al., and three other cases.
    Nos. 1626-1629.
    District Court, D. Maryland.
    May 14, 1931.

      Cook, Chesnut & Markell, of Baltimore, Gabriel L. Hess and Edward A. Sargoy both of New York City) and S. Ralph Warnken and Edward A. Smith, both of Baltimore, Md., of counsel), for plaintiffs.
    Harry Wroth Shenton, of Baltimore, Md., and Samuel M. Boyd, of Washington, D. C. (Samuel M. Boyd, of Washington, D. C., of counsel), for defendants.
   WILLIAM C. COLEMAN, District Judge.

The questions here involved arise under the Copyright Law (17 USCA § 1 et seq.) in its relation to motion pictures, infringement' of which the plaintiffs allege in each of the-four eases which have been consolidated and heal’d ’as one. ’ .The material facts are "as follows: Plaintiff^'are proprietors and distributors of various copyrighted motion pictures/' Defendants own ,ánd operate a theater in .the' town df'Greeensbo'ro and. also one in the town' of Centreville, Md. 'At the theater in Greens/”' boro, a number of the plaintiffs’ copyrighted motion pictures were exhibited without a license, the films having come into the defendants’ hands pursuant to a contract made with one of the defendants which permitted only limited exhibitions of the films at tbe theater in Centreville; vice versa, a picture of one of the plaintiffs (RKO Productions, Ine.), delivered to tbe theater in Greensboro under a license, contract for a single day’s exhibition at that theater alone, was exhibited by the defendants at the theater in Centreville. This practice of exhibiting motion pictures at times or places prohibited by the license agreements is commonly known in the industry as holding over or bieycling. • The films are not produced for sale by the plaintiffs, but are ■distributed, pursuant to so-ealled standard exhibition contracts (the form of which was adopted at a general trade conference in 1^-27); through numerous exchange centers, located throughout the United States. The right, of .the exhibitor signing such contract to exhibit, the film is strictly limited as to time and place. It further appears that a picture of one of the plaintiffs, namely, Warner Bros. Pictures, Ine., was exhibited at the Greensboro theater after the defendants had1 been served with a complaint by the plaintiffs on account of an alleged similar infringement by exhibition of another of its pictures. In all four suits the relief sought is an - injunction and damages under the Copyright Law.

Prior to answering the bills of complaint tbe defendants moved to dismiss them on the ground of lack of jnrisdietiofi. After hearing, these motions were denied, answers were filed, and testimony taken, as a 'result of which three questions have been -presented to the court- for 'decision. First, does the Copyright Law give a right of action because of unlicensed exhibition of copyrighted motion pictures? Second, does plaintiffs’ 'refusal to arbitrate their claims against the defendants* in accordance with the arbitration provisions in the licensed contracts, preclude plaintiffs from the right'to resort to' the present action? Third, assuming that plaihtifls-are entitled to damages, must the court) As-they contend,-grant them an election to take the minimum statutory damages of $250 for ekeh infringement in lieu'of dctual damages,, oi’, !as defendants contend, may the court award nominal damages for‘each infringement as the actual damages sustained?'

While, similar suits appear to have been, brought'' in several pther federal courts, they were' for the most parti uneontested, and no-reported opinions dealing with these precise points existed when the eases were heard. The questions will be considered in the order above stated. We therefore come to the first question, namely, Does the Copyright Law give a right of action because of unlicensed ■exhibition of copyrighted motion pictures?

The provisions of the Copyright Law per* tinent to this inquiry are the following:

“Any person entitled thereto, upon complying with the provisions of this title, shall have the exclusive right:
“(a) To print, reprint, publish, copy, and vend the copyrighted work. * * *
“(d) To perform or represent the copyrighted work publicly if it be a drama or, if it be a dramatic work and not reproduced in copies for sale, to vend any manuscript or any record whatsoever thereof; to make of to procure the making of any transcription or record thereof by or from which, in whole or in part, it may in any manner or by any method be exhibited, performed, represented, produced, or reproduced; and to exhibit, perform, represent, produce, or reproduce it in any manner or by any method whatsoever. * * *" 17 USCA § 1.
“Application for registration shall specify to which of the following classes the work in which copyright is claimed belongs: * * *
“(d) Dramatic or dramatieo-musical compositions; * * *
“(Z) Motion-picture photoplays;
“(m) Motion pictures other than photo-plays.
“The above specifications shall not be held to limit the subject matter of copyright as defined in section 4 of this title, nor shall any error in classification invalidate or impair the copyright protection secured under this title.” (17 USCA § 5).
“Copyright may also be had of the works of an author, of which copies are not reproduced for sale, by the deposit, with claim of copyright, of one complete copy of such work if it be a lecture or similar production or a dramatic, musical, or dramatieo-musical composition; of a title and description, with one print taken from each scene or act, if the work be a motion-picture photoplay; * * * of a title and description, with not less than two prints taken from different sections of a complete motion picture, if the work be a motion picture other than a photo-play. * * *” (17 USCA § 11).

The classifications (Z) and (m) above quoted of section 5, and the quoted provision of section 11 prescribing the method for registering copies of motion pictures, were brought into the Act of March 4, 1909, by amendment in 1912 (35 Stat. 1075-1088; 37 Stat. 488). Defendants contend that these amendments of 1912 indicate that motion pictures then came for the first time under the protection of the copyright laws; that the protection thereupon granted was limited, namely, that it was merely against duplica•tion or vending of films, and that an unlicensed exhibition of a copyrighted picture is not within the scope of the protection afforded. In short, defendants contend that the exhibitions here complained of are neither a “publication” nor a “copy” within the meaning of section 1 (a) of the act, and further contend that a motion picture cannot be classed as a “dramatic work” as that phrase is used in section 1 (d).

The question whether the exhibition or display of a moving picture is a “copy” within the meaning of section 1 (a) of the act is probably disposed of by the Supreme Court in the case of White-Smith Music Publishing Co. v. Apollo Co., 209 U. S. 1, 28 S. Ct. 319, 52 L. Ed. 655, 14 Ann. Cas. 628. The language of this opinion, rendered prior to the amendment of 1909, would seem to require a negative answer to the question. There the court decided that a copy of a musical composition within the meaning of the statute does not include perforated rolls, that is, pianola records, saying, page 17 of 209 U. S., 28 S. Ct. 319, 323, that the definition of the word “copy” “which most commends itself to our judgment is perhaps as clear as can be made, and defines a copy of a musical composition to be ‘a written or printed record of it in intelligible notation.’ * a ® The statute has not provided for the protection of the intellectual conception apart from the thing produced, however meritorious such conception may be, but has provided for the making and filing of a tangible thing, against the publication and duplication of which it is the purpose of the statute to protect the composer.” In this case there was no complaint of the public performance of copyrighted music, nor was there involved the question whether the manufacturers of the perforated music rolls, when sold for use in public performance, might be held as contributing infringers. One of the purposes of the amendment of 1909 was to overcome the effect of this decision, and to afford the copyright owner adequate protection of his mechanical rights. See Irving Berlin, Inc., v. Daigle (C. C. A.) 31 F.(2d) 832. 17 USCA §§ 1 (e), 5, 25 (e).

Turning next to the question whether the exhibition of a moving picture is a “publication” within the meaning of section 1 (a) of the act, the decision of the Supreme Court in the last-mentioned ease is also strongly persuasive of a negative answer to this question, although the generally recognized definition of the word “publication” would seem to warrant a contrary conclusion. In its ordinary acceptation the word “publication” means “to make public; to make known to people in general * * * to bring before the public, as for sale or distribution; especially (a) to print, or cause to be printed, and to issue from the press either for sale or general distribution, as a book, newspaper, piece of music, engraving, ete.” Webster’s International Dictionary. “To make public, to make known to people in general; * * * to exhibit, display, disclose or reveal.” Century Dictionary. Sale is, of course, not an essential element. If, where the question is whether an author has lost his common-law or statutory copyright, publication is accomplished by placing a book in a library (Jewelers’ Mercantile Agency v. Jewelers’ Publishing Co., 155 N. Y. 241, 49 N. E. 872, 41 L. R. A. 846, 63 Am. St. Rep. 666), or delivering it to a public office, or place (Callaghan v. Myers, 128 U. S. 617, 9 S. Ct. 177, 32 L. Ed. 547; D’Ole v. Kansas City Star Co. [C. C.] 94 F. 840), it is difficult to see any valid distinction, when, as a practical matter, the value of the copyright consists in the monopolistic right to project and exhibit the picture itself from each and every film, as well as in the right to exclude others from duplicating the film. Protection merely of the latter right may be entirely ineffectual to accomplish the desired end. The statute must be given a sensible meaning in its application to modem invention, expressly within the scope of the statute. See Buck et al. v. Jewell-LaSalle Realty Co., 51 S. Ct. 419, 75 L. Ed.-decided by the Supreme Court, April 13, 1931.

In Universal Film Manufacturing Co. v. Copperman (C. C. A.) 218 F. 577, the court clearly intimated that the exhibition of a copyrighted motion picture would have been considered an infringement of the copyright, except for the fact that the copyright was found to be void because of prior publication and dedication in England before registration in the United States. Similarly, in MacMillan v. King (D. C.) 223 F. 862, it was held that, where a teacher lent to his students mimeographed typewritten copies of parts of a copyrighted text-book, such was both a printing and publication within the meaning of the Copyright Act.

However, assuming, without deciding, that the exhibition here complained of was neither a “publication” nor a “copy” within the meaning of section 1 (a) of the act, there would seem to be no escape from the conclusion that the plaintiffs are nevertheless entitled to invoke the protection of section 1 (d) on the ground that a “motion-picture photo-play” is a “dramatic work.” They are both cognate forms of production. It is no longer open to question that a moving picture presentation of an author’s copyright-work is a dramatization of such work (although dramatic and motion picture rights may be made the subject of independent contract), and that the person producing the films for such pictures and offering them for sale or exhibition, without a license so to do, even if not himself exhibiting them, is liable for infringement. This was decided in Kalem Co. v. Harper Bros., 222 U. S. 55, 32 S. Ct. 20, 56 L. Ed. 92, Ann. Cas. 1913A, 1285. There Justice Holmes, rendering the opinion of the court upholding a decree restraining an alleged infringement of the copyright upon General Lew Wallace’s “Ben Hur,” said, pages 61, 62 of 222 U. S., 32 S. Ct. 20, 21: “We are of opinion that Ben Hur was dramatized by what was done. Whether we consider the purpose of this clause of the statute, or the etymological history and present usages of language, drama may be achieved by action as well as by speech. Action can tell a story, display all the most vivid relations between men, and depict every kind of human .emotion, without the aid of a word. It would be impossible to deny the title of drama to pantomime as played by masters of the art. Daly v. Palmer, 6 Blatchf. 256, 264, Fed. Cas. No. 3,552. But if a pantomime of Ben Hur would be a dramatizing of Ben Hur, it would be none the less so that it was exhibited to the audience by reflection from a glass, and not by direct vision of the figures, — as sometimes has been done in order to produce ghostly or inexplicable effects. The essence of the matter in the ease last supposed is not the mechanism employed, but that we see the event or story lived. The moving pictures are only less vivid than reflections from a mirror. With the former as with the latter our visual impression — what we see — is caused by the real pantomime of real men through the medium of natural forces, although the machinery is different and more complex.” See, also, Photo-Drama Motion Picture Co., Inc., v. Social Uplift Film Corp. (C. C. A.) 220 F. 448; Klein v. Beach (C. C. A.) 239 F. 108; U. S. v. Motion Picture Patents Co. (D. C.) 225 F. 800; Id. (D. C.) 230 F. 541; Id., 247 U. S. 524, 38 S. Ct. 578, 62 L. Ed. 1248; Atlas Mfg. Co. v. Street & Smith (C. C. A.) 204 F. 398, 47 L. R. A. (N. S.) 1002; Id., 231 U. S. 349, 34 S. Ct. 73, 58 L. Ed. 262; Id., 231 U. S. 755, 34 S. Ct. 323, 58 L. Ed. 468; Id., 232 U. S. 725, 34 S. Ct. 602, 58 L. Ed. 815.

To the contention that, since section 5 has separate classifications for dramatic or dram-atieo-musieal compositions and for motion picture photoplays, therefore section 1 (d) is not to be interpreted as embracing the latter, it is sufficient to point out that the classification of section 5 is merely for the convenience of the copyright office and of applicants for copyrights. Such interpretation is strengthened by the last paragraph of section 5.

The ease of Littleton v. Oliver Ditson Co. (C. C.) 62 F. 597, is stressed as requiring a contrary conclusion. But that case involved different provisions of the law, and is not to be taken as in conflict with an interpretation of those provisions actually before us which is the most reasonable interpretation in the light of what the Supreme Court and various Circuit Courts of Appeal have since said.

We find nothing in the congressional debates which indicate a different legislative intent. In fact, the question appears not to have been discussed when sections 5, 11, and 25 were amended in 1912. The debates that occurred with respect to prohibiting and penalizing the unauthorized exhibition, through moving pictures, of copyrighted plays and books, are obviously not apposite to the precise point. Since, then, a motion picture photoplay is to be considered as embraced within the term “dramatic work,” as used in section 1 (d), and since, if copyrighted, it is an infringement for one without permission “to exhibit, perform, represent, produce, or reproduce it in any manner or by any method whatsoever,” projecting it upon the screen is of course within the prohibition. The fact that the construction of the statute here adopted excludes motion pictures other than photoplays may produce an undesirable or even inequable result. But that is a practical, not a legal objection, properly to be addressed to the lawmakers, not to the courts. Only photoplays are here involved.

We now turn to the second question, namely, Does plaintiffs’ refusal to arbitrate their claims against the defendants, in accordance with the arbitration provisions in the license contracts, preclude plaintiffs from the right to resort to the present action ?

Since the present case was submitted, two decisions have been rendered which set at rest any further controversy on this point, and require that the question be answered in the negative. One of these decisions is by the Supreme Court, Paramount Famous Las-ky Corporation v. U. S., 282 U. S. 30, 51 S. Ct. 42, 75 L. Ed. 145, and the other, Paramount Famous Lasky Corporation v. National Theatre Corporation, 49 F.(2d) 64, 65, is by the Circuit Court of Appeals for this circuit. In both of these cases the standard form of contract now before us was under consideration. In the first decision, the arbitration provisions of that contract were declared to be in violation of the Sherman AntiTrust Act (15 USCA § 1 et seq.), and therefore void. In the other decision, the precise question now under consideration was before the Circuit Court of Appeals. The court said:

“The judge below sustained the demurrer on the ground that the arbitration provision was a condition precedent to the bringing of any suit on the contract, notwithstanding the injunction, which prevented arbitration, and based his opinion upon a number of authorities holding that, where the condition precedent to the bringing of suit was prevented from being carried out by some unlawful act of the parties seeking to set up the injunction as a reason for not carrying out the condition, the excuse or reason could not be availed of by the parties seeking to bring the action. An examination of the authorities relied upon by the court below shows that the act of the party making it impossible to carry out the condition precedent to suit was either a subsequent act or at least not the act itself of incorporating the unlawful condition in the contract sued upon. * * * These cases are easily to be distinguished from the instant case, where a clause of the very contract itself entered into by both parties has been declared unlawful and enjoined. Certainly, it eanndt be said, especially in view of the clause in the decree above quoted, exempting the rest of the contract from the taint of unlawfulness, that the whole contract is void, and that in case of breach by either party no remedy could be had.
“The record also shows that, because of the injunction secured by the United States government, the machinery for arbitration set up in the contract had ceased to exist, and the rule that an act of law, due to the aet or default of one of the parties, cannot be relied upon as an exeuse for his nonperformance of the contract, has no application to the facts in this ease. * * *
“It would, therefore, seem, in view of the cases herein cited, that the proper rule of law is that, where the obligation itself is unlawful and cannot be performed, such performance should be excused, provided the contract is divisible and the remainder of the contract is lawful. It is certainly an anomalous situation in which this plaintiff finds itself under the ruling of the court below. It is enjoined from performing a condition precedent, but no relief is aeeorded it, because it does not perform the condition.
“Again we think that the learned judge below was in error for another reason, and that is that the contract, as far as it related to the lawful and unlawful parts, was divisible. That this was the opinion of Judge Thaeher, in the ease of United States v. Paramount Famous Lasky Corporation [(D. C.) 34 F.(2d) 984], supra, is shown by the excerpt from his decree. That such a provision, as the one in question here, is separable from the rest of the contract, is borne out by a number of decisions. * * * ”

The contention that plaintiffs, by intrusting their films to defendants, pursuant to the terms of their contracts, have made an election of remedies, namely, have waived their right to sue in tort under the Copyright •Law, and are relegated to a suit in assumpsit on the contract, is unsound. While it is true that the suit in the last-named case was an action in assumpsit, that form of action is merely an alternate remedy, and nothing which the plaintiffs in the present ease have done precludes them from their right to resort to the remedy provided under the Copyright Law. Henry v. Dick, 224 U. S. 1, 32 S. Ct. 364, 56 L. Ed. 645, Ann. Cas. 1913D, 880; Healy v. Sea Gull Specialty Co., 237 U. S. 479, 35 S. Ct. 658, 59 L. Ed. 1056. An election of remedies presupposes a choice of one to the exclusion of the other. In order to constitute an election, the party must pursue one of the remedies. That is to say, there must be some decisive action by such party, with knowledge of the facts and of his rights. Robb v. Vos, 155 U. S. 13, 15 S. Ct. 4, 39 L. Ed. 52; U. S. v. Oregon Lumber Co., 260 U. S. 290, 43 S. Ct. 100, 67 L. Ed. 261.

Plaintiffs’ right to invoke the Copyright Law, therefore, being clear, and it being equally clear that on the admitted facts in all four cases infringement has occurred, we come to the final question of what damages plaintiffs are entitled to. They contend that they have the right to elect to take the minimum statutory damages of $250 for each infringement in lieu of actual damages, which have not been proved, while defendants contend that the court may award nominal damages for each infringement.

The pertinent provisions of the Copyright Law are the following:

“If any person shall infringe the copyright in any work protected under the copyright laws of the United States such person shall be liable:
“(a) To an injunction restraining such infringement;
“(b) To pay to the copyright proprietor such damages as the copyright proprietor may have suffered due to the infringement, as well as all the profits which the infringer shall have made from such infringement * * * or in lieu of actual damages and profits such damages as to the court shall appear to be just, and in assessing such damages the court may, in its discretion, allow the amounts as hereinafter stated, but [here follow limitations applicable specifically to newspaper reproductions of photographs, and certain motion picture infringements of undramatized or nondramatio work and of copyrighted dramatic or dramatico-musical work], and such damages shall in no other case exceed the sum of $5,000 nor be less than the sum of $250, and shall not be regarded as a penalty. But the foregoing exceptions shall not deprive the copyright proprietor of any other remedy given him under this law, nor shall the limitation as to the amount of recovery apply to infringements occurring after the actual notice to a defendant, either by service of process in a suit or other written notice served upon him. • * *
“Fourth. In the case of a dramatic or dramatico-musical or a choral or orchestral composition, $100 for the first and $50 for every subsequent infringing performance; in the case of other musical compositions $10 for every infringing performance.” 17 USCA § 25.

This final question is disposed of in favor of the plaintiffs by the very recent decision of the Supreme Court in Jewell-LaSalle Realty Co. v. Gene Buck, 51 S. Ct. 407, 408, 75 L. Ed. -. In that ease the American Society of Composers, Authors, and Publishers, and one of its members, sued ■the Jewell-LaSalle Realty Company in the federal court for Western Missouri, for an unauthorized orchestral performance of a musical composition for which the plaintiffs held exclusive nondramatie performing rights. Just as here, the infringement was proved, but there was no showing of actual ■damages. The defendant contended that the plaintiffs were entitled to only $10' statutory damages, while plaintiffs claimed that $250 was the allowable minimum. The lower court [32 F.(2d) 366] granted an injunction and awarded $250 damages, from which the defendant appealed, and the Circuit Court of Appeals certified the three following questions :

“In a case disclosing infringement of a •copyright covering a musical composition, there being no proof of actual damages, is the court bound by the minimum amount of $250 set out in the so-called ‘no other case’ ■clause of section 25 (b) of the Copyright Act (17 USCA § 25), reading, ‘and such damages shall in no other ease exceed the sum of $5,000 nor be less than the sum of $250, and shall not be regarded as a penalty?’ ”
“Is section 25 (b) Fourth of the Copyright Act (17 USCA § 25), applicable in the discretion of the Court, to a ease disclosing infringement of copyright covering a musical composition, there being no proof of actual damage?”
“In section 25 (b) of the Copyright Act (17 USCA § 25) is the clause reading, ‘nor shall the limitation as to the amount of recovery apply to infringements occurring after the actual notice to a defendant,’ confined in its scope to the particular cases of infringement theretofore specifically mentioned in said section 25 (b) ?”

Answering the first question in the affirmative, the court said: “The Copyright Act confers two monopolies — that of making ■copies and that of giving public performances for profit. It was settled in Westerman Co. v. Dispatch Printing Co., 249 U. S. 100, 39 S. Ct. 194, 63 L. Ed. 499, which dealt with the infringement by a newspaper of the monopoly of copying, that for each publication $250 is the minimum damages. An unbroken line of decisions in the lower courts has since held that the rule declared in tiie Westerman Case is applicable also to infringement of the monopoly of giving public performances. It is now contended that, as applied to performances, the rule is burdensome and unreasonable; that it was followed unwillingly by the lower courts in the mistaken belief that the Westerman Case required them to do so; that the legislative history of section 25, when considered in the light of earlier Copyright Acts, indicates that the fourth subdivision, relating to musical compositions, was not intended to be controlled by the maximum and minimum provisions of the so-called ‘no other case’ clause; and that the decision in the Wester-man Case is not decisive of the question certified.” After analysing the opposing arguments, the court continued:

“The history of the section, as revealed in the extended hearings which preceded the act of 1909, makes the contrary clear. We are of opinion that the maximum and minimum provisions were intended to be applicable alike to all types of infringement except those for which the section makes other specific provision.
“It is urged, however, that under such interpretation the suggested measure of $10 a performance, scheduled in the fourth subdivision of section 25, would not be applicable unless more than twenty-five infringing performances were proved. This appears to be the meaning of the section, read as a whole, particularly since the amounts in the scheduled subdivisions appear to have been inserted merely as an aid to the court in awarding such damages as ‘shall appear to be .just.’ The definite specification of a maximum and minimum in every ease, is not contradicted in any way by these legislative suggestions as to what may be deemed reasonable allowances in eases falling within the prescribed limitations. See Westerman v. Dispatch Printing Co., 249 U. S. 100, 106, 109, 39 S. Ct. 194, 63 L. Ed. 499. If, as applied to musical compositions, the provisions of the entire section have proved unreasonable, the remedy lies with Congress.”

Substituting the words “dramatic compositions” for the words “musical compositions” in the last sentence quoted, the statement of the Supreme Court is an equally complete answer to the defendants’ arguments in the present cases.

The Supreme Court also answered in the affirmative the second question above quoted' which was certified to it, saying: “This question has in part been necessarily answered by our discussion of question II, for, unless the number of infringing performances of a copyrighted musical composition exceeds twenty-five, the minimum allowance of $250 must be made. ' Where more than twenty-five infringing performances are proved, and there is no showing as to actual loss; the court must allow the statutory minimum, and may, in its sound discretion, employ the scheduled $10 a performance as a basis for assessing additional damages. See Westerman v. Dispatch Printing Co., 249 U. S. 100, 106, 39 S. Ct. 194, 63 L. Ed. 499. Subject to this limitation, question III is answered in the affirmative.”

In declining to answer the last question (above quoted) certified to it, the court said: “Inasmuch as the plaintiffs did not ask for more than the minimum statutory damages of $250, and did not appeal from the decree awarding only this sum, the question whether the court might have awarded more than the maximum of $5,000 is not properly raised upon the facts presented in this certificate.”

Although in one instance the present defendants made an infringing exhibit of a picture after being notified in writing by the plaintiff copyright owner not to do so, no claim is made for more than the statutory damages of $250 for each infringement. Accordingly, the damages will be so decreed in favor of the plaintiffs against the defendants (they being treated as joint tort-feasors in each suit), in addition to an injunction as prayed, and also costs and an attorneys’ fee in the aggregate sum for all four suits of $1,-000,.pursuant to the provisions of section 40 of the Copyright Act (17 USCA § 40).


author: KENNAMER, District Judge.

text:
    ADAMS et al. v. OSAGE TRIBE OF INDIANS et al.
    No. 642.
    District Court, N. D. Oklahoma.
    June 22, 1931.
    F. E. Riddle, of Tulsa, Okl., and Hol-combe, Lohman & Barney, of Pawhuska, Okl., for complainants.
    John M. Goldesberry, U. S. Dist. Atty., of Tulsa, Okl., T. J. Leahy, of Pawhuska, Okl., Fred M. Carter, of Bartlesville, Okl., and W. P. McGinnis, of Tulsa, Okl., for defendants.
   KENNAMER, District Judge.

The complainants seek by their bill to quiet title in and to the oil, gas, and other minerals under lands purchased by them from individual Osage Indian allottees. The Osage allottees, as grantors of the complainants, received their allotments pursuant to the provisions of the Allotment Act approved June 28, 1906 (34 Stat. 539). The defendants the Texas Company, a corporation, and the Indian Territory Illuminating Oil Company, a corporation, are the lessees of the lands involved in this action under leases executed by the Osage Tribe of Indians, through its Tribal Council, and approved by the Secretary of the Interior, which are commonly referred to as departmental leases.

The defendants have filed motions to dismiss the bill. The contention of the complainants is that as purchasers of the surplus allotments of individual allottees of the Osage-Tribe, from whose allotments restrictions against alienation had been removed, or to whom a certificate of competency had been issued to such allottees, they became vested with the fee-simple title in such lands, including the oil, gas, and other minerals, subject only to a reservation of the use of the oil and gas and other minerals to the tribe for a definite and fixed period of twenty-five years from April 8, 1906, and which expired on April 8, 1931, and that the Acts of Congress of March 3, 1921, and March 2, 1929, extending the reservation of the use of the oil and gas and other mineral rights for the benefit of the Osage tribe in common as provided for in the Allotment Act of June 28, 1906 (34 Stat. 539), in so far as such provisions in said acts affect complainants’ property rights by reason of their purchasers-from individual Osage allottees, are invalid and unconstitutional and contravene the Fifth and Fourteenth Amendments to the Constitution of the United States.

The contention of the complainants is untenable. A careful consideration of the various acts of Congress involved discloses that the complainants have never by reason of their purchases become vested with the title in and to the oil and gas and other minerals found under the lands involved in this action. The conveyances under which the complainants assert title plainly provide that they are subject “to all conditions, limitations and provisions of the Act of Congress of March 3, 1909 (35 Stat. 778), and the Act of Congress of June 28,1906 (34 Stat. 539), “but if said conveyances contained no such reference it cannot be doubted that such conveyances would be subject to all of the provisions of said acts relating to the lands allotted to members of the Osage Tribe of Indians and held in trust by the government for their use and benefit. Any conveyance made in violation of the provisions of such acts would be void.

The United States on the 19th day of July, 1866 (14 Stat. 799), entered into a Treaty with the Cherokee Tribe of Indians under the terms of which the government * was granted the right to settle friendly Indians in any part of the Cherokee country west of the Ninety-Sixth Meridian, to be taken in compact form.

By Treaty with the Osages on September 29, 1865 (14 Stat. 687) it was provided for the sale by the Osages to the government of a tract of land along the east edge of the Osage reservation in the state of Kansas fifty miles long north and south, and thirty miles wide east and west, for the sum of $300,000. By the same treaty the Osages also ceded to the United States a tract of land twenty miles wide north and south along the entire north side of the reservation in Kansas, the same to be held in trust by the government and sold for the benefit of said tribe. In this- same treaty the Osages acknowledged their dependence on the government of the United States and invoked its protection. It was further provided that if the Osages agreed to remove from the state of Kansas and settled on lands provided for them by the United States in the Indian Territory, the reservation of the Osages in the state of Kansas should be disposed of by the United States for the benefit of the tribe.

By Act of Congress of July 15,1870, § 12 (16 Stat. 362), the President was authorized and directed to remove the Osages from the state of Kansas to the Indian Territory to lands to be purchased in the Indian Territory from funds arising from the sale of their tribal lands in Kansas. • By Act of June 5, 1872 (17 Stat. 228), it was provided that by reason of the fact the lands designated in the Indian Territory for the Osage Tribe of Indians and purchased from the Cherokees, and to which said Osage Tribe had been removed, were found on survey to lie east of the Ninety-Sixth Meridian, whereas the Treaty with the Cherokees required the land taken for friendly tribes should lie west of the Ninety-Sixth Meridian, and it was necessary to remove the Osage Tribe of Indians to a tract west of the Ninety-Sixth Meridian, and in said act is found the following pertinent provision: “In order to provide said Osage tribe of Indians with a reservation, and secure to them a sufficient quantity of land suitable for cultivation, the following-described tract of country, west of the established ninety-sixth meridian, in the Indian Territory, be, and the same is hereby, set apart for and confirmed as their reservation, namely: Bounded on the east by the ninety-sixth meridian, on the south and west by the north line of the Creek country and the main channel of the Arkansas river, and on the north,by the south line of the State of Kansas.” The Act of Congress of March 3,1873, c. 228 (17 Stat. 530-538), provided for payment to the Cherokees for the lands purchased for the Osage Tribe of Indians in the Indian Territory out of any funds arising from the sale of the Osage lands in the state of Kansas. By the Act of Congress of February 28,1891 (26 Stat. 795, § 3 [25 USCA § 397]), it was provided that where lands were occupied by Indians who had bought and paid for the same, and they were not needing it for farming or agricultural purposes, and not desired for individual allotments, such lands might be leased by authority of the council acting for such Indians for mining purposes for a period not exceeding ten years, with the approval of the Secretary of the Interior. Section 1 of the Act of June 28,1906 (34 Stat. 539), known as the Allotment Aet, provides that “the tribal lands and tribal funds of said tribe shall be equally divided among the members of said tribe as hereinafter provided.” Section 2 of said aet (34 Stat. 540) provides for the giving to each member of the tribe his or her fair share thereof in acres, and the •manner of selection thereof. Subdivision 7 of section 2 (34 Stat. 542)- contains the following provision: “And provided further, That nothing herein shall authorize the sale of the oil, gas, coal, or other minerals covered by said lands, said minerals being reserved to the use of the tribe for a period of twenty-five years, and the royalty to be paid to said tribe as hereinafter provided: And provided further, That the oil,- gas, coal, and other minerals upon said allotted lands shall become the property of the individual owner of said land at the expiration of said twenty-five years, unless otherwise provided for by Aet of Congress.” Section 3 of said act (34 Stat. 543) provides: “That the oil, gas, coal, or other minerals covered by the lands for the .selection and division of which provision id herein made are hereby reserved to the Osage' tribe for a period of twenty-five'years from and after the eighth day of April, nineteen hundred and six; and leases for all oil, gas, and other minerals, covered by selections and division of land herein provided for, may be made by the Osage tribe of Indians through its tribal council, and with the approval of the Secretary of the Interior, and under such rules and regulations as he may prescribe.” Subdivision 2 of section 4 of said aet (34 Stat. 544) provides that the royalties from said lands should be placed in the Treasury of the United States to the credit of the members of the Osage Tribe, as other moneys of said tribe are deposited. Section 5 of said act (34 Stat. 544) provides: “That at the expiration of the period of twenty-five years from and after the first day of January, nineteen hundred and seven, the lands, mineral interests, and moneys, herein provided for and held in trust by the United States shrill be the absolute property of the individual members of the Osage tribe, according to the roll herein provided for, or their .heirs, as herein provided, and deeds to said lands shall- be issued to said members, or to their heirs, as herein provided, and said moneys shall be distributed to said members, or to their heirs, as herein provided, and said members shall have full control of said lands,, moneys, and mineral interests, except .as hereinbefore provided.” The Act of Congress of' March 3, 1921 (41 Stat. 1249), extended the-trust period to be exercised by the government over the minerals in the Osage allotments until the 8th day of April, 1946. By the Act of March 2,1929 (45 Stat. ,1478), the trust period over such mineral rights in said' lands was further extended until January-rl,. 1959.

It is clear from a consideration of the-various treaty provisions and the acts of Congress under which members of the OsagbTribe of Indians received their allotments-that Congress is well within its plenary authority in extending the trust period over' the mineral rights of lands allotted to' members of the Osage Tribe of Indians. The authority ' of Congress over the Indians and' their tribal relations, with full power to legislate eoneernihg their ’tribal property, has-been repeatedly sustained by the Supreme-Court of- the United States. Worcester v. State of Georgia, 6 Pet. 515, 8 L. Ed. 483; Williams v. Johnson, 239 U. S. 414, 36 S. Ct. 150, 60 L. Ed. 358; Tiger v. Western Investment Co., 221 U. S. 286, 31 S. Ct. 578, 55 L. Ed. 738; Heckman v. United States, 224 U. S. 413, 32 S. Ct. 424, 56 L. Ed. 820; Nadeau v. Union Pacific R. R. Co., 253 U. S. 442, 40 S. Ct. 570, 64 L. Ed. 1002; Bowling v. United States, 233 U. S. 528, 34 S. Ct. 659, 58 L. Ed. 1080. In the last case cited, supra, the-court said: “The guardianship of the Federal government over an Indian does not cease-when an allotment is made and the allottee becomes a citizen of the United States.” It is quite clear from a consideration of the Allotment Act of June 28,1906, supra, and the subsequent provisions of the Aet of March 3,. 1921, and the Act of March 2,1929, that Congress has never relinquished control over the* mineral rights in the lands allotted to mem.bers of 'the Osage Tribe of Indians, but has equitably provided for the administration of' the proceeds arising from the royalties from-such mineral leases covering said lands as a-, trust fund for the benefit of the members of' the tribe. In the ease of Goodrum et al. v. Buffalo, 162 F. 817 (8 C. C. A.), the court at page 827 used language pertinent to the-contention made by the complainants in this-case: “It should be understood, once for all,, that no scheme or device, however ingenious or plausible, concocted by any person,, can-avail to divest the Indians of the title to their' allotted lands within the period of limitation-prescribed by Congress.” Treaties and statutes affecting Indians and their lands are to be construed most favorably to the Indian. Choate v. Trapp, 224 U. S. 665, 32 S. Ct. 565, 56 L. Ed. 941.

The bill of the complainants fails to state facts sufficient to entitle them to any relief and should be dismissed. It is so ordered.