Lapas attēli

23 F.(2d) 71

becomes the most important and properly [is] called the main channel of the river." Again, in an opinion denying a rehearing (214 U. S. 205, 29 S. Ct. 631, 53 L. Ed. 969), the court expressed its agreement with the contention that the term "widest channel" does not mean the broadest expanse of water, and said: "There must be in the first instance a channel-that is, a flow of waterdeep enough to be used and in fact used by vessels in passing up and down the river; but it does not mean the deepest channel, but simply the widest expanse of water which can reasonably be called a channel."

The applicability of these decisions is direct. They lead to the conclusion that, though by erosion of Puget Island the river has widened and the center of the old channel has been changed somewhat, and has become more shallow than it was at the time of the fixing of the boundary of the state of Oregon, such changes are not to be confused with changes made by the creation of the slough channel, which was caused by sudden and known causes, not by accretion. The demarking line must therefore remain the center of the channel between Puget Island and Oregon before the avulsion.

The decree of the District Court is affirmed.

MO., et al. (two cases).


Circuit Court of Appeals, Eighth Circuit.
November 23, 1927.

Separate suits by Edwin A. Krauthoff and F. Henry Raab against the Kansas City Joint-Stock Land Bank of Kansas City, Mo., and others. Motions to dismiss the bills were sustained, and plaintiffs appeal. Modified and affirmed.

Edwin A. Krauthoff, of Kansas City, Mo., Bruce W. Sanborn, of St. Paul, Minn., W. F. Lilleston, of Wichita, Kan., and Ernest D. Wilson, of Kansas City, Mo. (Sanborn, Graves & Ordway, of St. Paul, Minn., and Vermilion, Evans, Carey & Lilleston, of Wichita, Kan., of counsel), for appellants.

Rhodes E. Cave, of St. Louis, Mo., Herman M. Langworthy, of Kansas City, Mo., and Thomas S. McPheeters, of St. Louis, Mo. (Bryan, Williams & Cave, of St. Louis, Mo., and Langworthy, Spencer & Terrell, of Kansas City, Mo., of counsel), for appellees.

Before LEWIS, Circuit Judge, and POLLOCK and SCOTT, District Judges.

LEWIS, Circuit Judge. The Kansas City Joint-Stock Land Bank of Kansas City, Missouri, was organized under the Farm Loan Act. 12 USCA c. 7. It was organized pursuant to the provisions of the Act by the Federal Farm Loan Board, which board was created by the Act, and after its organization the board had authoritative direction over its operations. The administration of the whole Act was entrusted by Congress to the direction of the board (section 641), and in addition to specific powers given to it, section 831 provides that the board may "exercise such incidental powers as shall be necessary or req

Rehearing Denied with Modification February uisite to fulfill its duties and carry out the

10, 1928.

Nos. 7874, 7875, 7939.

Constitutional law 74-Court held unauthorized to interfere with Federal Farm Loan Board, acting through receiver, winding up insolvent joint-stock land bank; "federal agency;" "public officer" (Farm Loan Act [12 USCA §§ 641, 831, 961, 963]; National Banking Act).

Court held unauthorized to interfere in winding up of affairs of insolvent joint-stock land bank, organized under Farm Loan Act (12 USCA c. 7 [sections 641-1021]), by appointment of receiver, where Federal Farm Loan Board had appointed receiver pursuant to sections 641, 831, 961, 963, since bank was "federal agency," and receiver appointed by board is "public officer"; procedure under chapter 7 being in substance like that of National Bank

ing Act (Act June 3, 1864 [13 Stat. 99]).

[Ed. Note.-For other definitions, see Words and Phrases, First and Second Series, Officer.]

Appeal from the District Court of the United States for the Western District of Missouri; Albert L. Reeves, Judge.

purposes of this chapter." Section 963 provides: "Upon default of any obligation, federal land banks and joint-stock land banks may be declared insolvent and placed in the hands of a receiver by the Federal Farm Loan Board, and proceedings shall thereupon be had in accordance with the provisions of this section [subdivision] regarding national farm loan associations." Section 961 provides for the appointment of a receiver by the board for a national farm loan association, and says: "Such receiver, under the direction of the Federal Farm Loan Board, shall take possession of the books, records, and assets of every description of such association, collect all debts, dues, and claims belonging to it, and, with the approval of the Federal Farm Loan Board, or upon the order of a court of record of competent jurisdiction, may sell or compound all bad or doubtful debts, and, on a like approval or order, may sell all the real and personal property of such association, on such terms as the

Federal Farm Loan Board or said court shall conflict with the Fifth Amendment. direct."

The board found the joint-stock bank to be in default of its obligations, that it was insolvent, and in May, 1927, placed it in the hands of William R. Compton as its receiver. Shortly thereafter appellant Krauthoff, as the owner of bonds issued by the bank, and appellant Raab, as one of its stockholders, separately brought these suits, alleging the appointment of Compton, that he had qualified as receiver and was in possession, that farm mortgages belonging to the bank, to the amount of about $46,000,000 and United States Government bonds to the amount of $770,000 had been deposited by the bank with C. A. Ryker, the duly appointed Farm Loan Registrar, in Federal Loan Bank District No. 9, to secure the payment of approximately $44,000,000 in bonds issued by the bank and then outstanding, that the records of the bank had not been accurately kept and it would be impossible without a discovery and accounting to ascertain its true condition, that some of the mortgages deposited with Ryker had been foreclosed and title to farms taken in some one for the bank and the nature of these proceedings cannot be ascertained without a discovery, that a large amount of interest due on said farm mortgages is in default and there is controversy whether said interest should be collected by Ryker or Compton and a court of equity should determine that controversy, that it will become necessary to foreclose many of the mortgages and the question has arisen as to who should conduct the foreclosures and pay the expenses thereof, and to avoid a multiplicity of complications and litigation a court of equity should through its receiver take possession of said securities, direct how the mortgage debts should be liquidated and the funds, both principal and interest, disposed of, that Ryker, under the direction of the Federal Farm Loan Board, has clipped certain interest coupons from the United States Government bonds hypothecated to secure the bonds issued by the bank and delivered them to Compton and it will be the duty of Compton to pay the amounts thereof when collected into the Treasury of the United States under the terms of the Act, that Compton's authority is limited by section 961, supra, to collecting the bank's assets, compounding its debts and selling its property if necessary, and then to paying the proceeds into the United States Treasury, subject to the order of the Federal Farm Loan Board, that then the money could not be paid out except upon an appropriation by an Act of Congress and thus the Act is in

It is

further alleged that many controversies will arise in the settlement of the insolvent estate involving justiciable issues between the parties at interest, that the Act imposes on each stockholder an individual liability to the amount of the stock owned at the par value thereof, in addition to the amount paid in as represented by his shares, and there is no provision in the Act by which the Federal Farm Loan Board or its receiver can make assessments against stockholders and collect the amounts for which they are liable. Other allegations are made of the kind that have been stated, all tending to show, as claimed, a denial of the constitutional right to a judicial determination at first occurrence of the many controversies that will arise in settling the insolvent estate. Each of the bills prays for the appointment of a receiver by the court, that the receiver so appointed oust Compton and the board and take possession of all the bank's property and administer it under the direction of the court as the rights of all parties interested may demand. Motions to dismiss the bills were sustained and the appeals challenge that action.

But for omissions in literal terms of specific authority to the Federal Farm Loan Board to allow claims against insolvent banks, declare and pay dividends on those claims, levy assessments on stockholders and collect them, we find no substantial difference between this Act and the National Banking Act (Act June 3, 1864 [13 Stat. 99]) in relation to the closing and settlement of their affairs when the banks become insolvent. In each the Executive Department is given control. We think this Act clearly intends that a procedure like that provided in the National Banking Act shall in substance be followed. There the Comptroller declares the insolvency and appoints a receiver, here the board; in both the assets are to be converted into cash by the receivers and paid into the Treasury; there the Comptroller causes claims to be presented after notice, declares dividends on those allowed and pays them by giving orders on the Treasury, here the section (962) which directs the receiver to pay over all moneys collected to the Treasurer of the United States says that the moneys so paid over shall be subject to the order of the Federal Farm Loan Board. It cannot be thought that there was any other purpose in making the assets of the insolvent bank subject to the order of the board than the use of them,—and the stockholder's liability if necessary,-in settlement of the insolvent estate, to pay the bank's debts; nor could those debts be paid

23 F.(2d) 73

until its creditors and the amount due each should be ascertained. A receiver appointed by the Comptroller must report to him, and a receiver appointed by the board must report to it. In each instance the receiver, like a court receiver, is an agent and receives his instructions from and is guided by the appointing authority. The Comptroller is the chief officer of a bureau in the Department of the Treasury; section 651 of chapter 7 creates a Federal Farm Loan Bureau in the Department of the Treasury and places it under the supervision of the Federal Farm Loan Board. A part of section 831 quoted supra, defining the powers of the board, gives it such incidental powers as are necessary or requisite to fulfill its duties and carry out the purposes of this chapter. Thus the board's authority to fully settle the bank's affairs is not left to implication. Its assets paid into the Treasury are subject to the board's orders. The creditors are entitled to them pro rata on disbursement to the extent of their claims, and they can be paid only by the orders of the board on those funds. The Act gives the board the necessary and requisite power in fulfillment of that duty. The bank was a federal agency. Smith v. Kansas City Title Co., 255 U. S. 180, 41 S. Ct. 243, 65 L. Ed. 577. The Act under which it was created and authorized to transact business, subject to the supervision and control of the board, prescribes, as we view it, the way in which it should be wound up in the case of insolvency. For that purpose the board took charge, of it, as does the Comptroller of an insolvent national bank. A receiver appointed by the board is a public officer, as much so as a receiver appointed by the Comptroller. United States v. Weitzel, 246 U. S. 533, 38 S. Ct. 381, 62 L. Ed. 872. At the time these suits were brought the board through its receiver was in possession discharging the duty imposed upon it by

Congress. We think we have no right to interfere in its discharge of that duty. Early terfere in its discharge of that duty. Early

in the administration of the National Bank

ing Act it was contended that the Comptroller, an executive officer, was, in discharging his duties, attempting to exercise judicial functions which belonged exclusively to the courts. The contention was held to be with

out merit. See Bushnell v. Leland, 164 U. S. 684, 17 S. Ct. 209, 41 L. Ed. 598. That seems to us to be the substance of the contention here. It may be that questions will arise during receivership that will require judicial determination; but that is far short of ousting the board and its receiver by the appointment of a court receiver. The bill shows that Compton had already applied to the court be

low for instructions on some matters that had arisen in administration, and we have no reason to doubt that like applications will be made if occasion requires it.

We think there was no error in the orders appealed from and they are Affirmed.

On petition for rehearing.

PER CURIAM. This cause came on to be heard on the petition for a rehearing filed by counsel for appellant.

On Consideration Whereof, It is now here ordered by this Court that the decree of this Court entered on November 28, 1927, be, and it is hereby, modified and amended so as to provide that the dismissal of the action in the District Court of the United States for the Western District of Missouri, be without prejudice and thus modified the decree of said District Court will stand affirmed by this Court in accordance with the opinion heretofore filed on November 23, 1927.

And it is further ordered that in all other respects the petition of appellant for a rehearing in this cause, be, and the same is hereby, denied.

Edwin A. KRAUTHOFF, Appellant, v. William R. COMPTON, as Receiver of Kansas City Joint-Stock Land Bank, of Kansas City, Missouri, and C. A. Ryker, as Farm Loan Registrar in Federal Land Bank District No. 9, Appellees.*

Circuit Court of Appeals, Eighth Circuit. November 23, 1927.

No. 7938.

Appeal from the District Court of the United States for the District of Kansas; John C. Pollock, Judge.

See, also, 23 F. (2d) 71.

Edwin A. Krauthoff, of Kansas City, Mo. F. Lilleston, of Wichita, Kan., Ernest D. (Bruce W. Sanborn, of St. Paul, Minn., W. Wilson, of Kansas City, Mo., Sanborn, Graves & Ordway, of St. Paul, Minn., and

Wichita, Kan., on the brief), for appellant. Vermilion, Evans, Carey & Lilleston, of

Rhodes E. Cave, of St. Louis, Mo. (Herman M. Langworthy, of Kansas City, Mo., Thomas S. McPheeters and Bryan, Williams & Cave, all of St. Louis, Mo., and Langworthy, Spencer & Terrell, of Kansas City, Mo., on the brief), for appellees.

Before LEWIS, Circuit Judge, and SCOTT, District Judge.

PER CURIAM. This suit is like those we have just considered and disposed of

*Rehearing denied February 10, 1928.

Company and others. From the decree (15 F.[2d] 578), complainant appeals. Affirmed.

Kenaz Huffman, of Denver, Colo. (Frank E. Gove, of Denver, Colo., on the brief), for appellant.

Forrest C. Northcutt, of Denver, Colo. (Jesse G. Northcutt, of Denver, Colo., on the brief), for appellees.

Before LEWIS, Circuit Judge, and POLLOCK and SCOTT, District Judges.

(Nos. 7874, 7875, 7939) 23 F. (2d) 71. It was brought by a creditor who owned bonds issued by Kansas City Joint-Stock Land Bank of Kansas City, Mo., in his own behalf and in behalf of all other creditors who might wish to join in the suit. The bill asks the court to appoint a receiver of the farm mortgages and United States government bonds pledged with C. A. Ryker, registrar, as security for the payment of the bonds. Ryker resides at Wichita, Kan., and the suit was brought in that district because that was the situs of the property that appellant sought to have impounded in receivership. The ultimate relief sought was the same as that in the other cases. It was alleged that controversies would arise in settlement of the insolvent estate, that neither Compton nor the Federal Farm Loan Board which appointed him receiver could exercise judicial functions, that creditors of the bank and its stockholders had a constitutional right to have those controversies determined judicially as they arose, and the bill asks that the court take possession of the assets held by Ryker through a receiver to be appointed by it and then proceed to administer the estate. The bill was dismissed on motion of appellees. The order of dismissal is affirmed, for the combination of colors and printed words. reasons stated in the other cases.

Circuit Court of Appeals, Eighth Circuit.
November 23, 1927.

No. 7838.

I. Trade-marks and trade-names and unfair competition 60-Trade-mark label of defendant held not so similar to complainant's as to be infringement or to deceive public.

Defendant's trade-mark, consisting of a label, though the same size and shape as complainant's, held not so similar in appearance as to be an infringement or a colorable imitation, which might mislead the public and constitute unfair competition.

2. Trade-marks and trade-names and unfair competition 21-Complainant cannot claim monopoly in size or shape of trade-mark, where labels of same size and shape were previously used by others.

Complainant cannot claim monopoly in size or shape of trade-mark label, where labels of same size and shape were previously used by


Appeal from the District Court of the United States for the District of Colorado; John Foster Symes, Judge.

Suit in equity by the Victor-American Fuel Company against the Huerfano Agency

*Rehearing denied February 10, 1928.

LEWIS, Circuit Judge. [1] Appellant brought this suit charging infringement of its trade-marks and unfair competition in the sale of coal. It is a Maine corporation and has been engaged for many years in the production and sale of coal in Colorado and adjoining States. It filed its trade-marks in the Patent Office. There were several such filings, all for the same purpose and representing different kinds of labels to be pasted on lump coal, distributed through fine coal · in cars and wagons, pasted on cars and wagons carrying its coal, and used as advertisement on letterheads and posters. The labels are flat and circular, being three inches or less in diameter and having on one side or face a

Their predominant color is red. There is a
white circular border on the outer edge, and
across the center a picture of a shovel of coal,
the shovel being white and the coal in it black.
Printed matter in black letters is found in
the white circular border, and also on the
field of red within. The printed matter in
the circular border is different in the different
trade-marks, thus: "This label assures you
this is genuine Maitland coal"-"Genuine
Wadge coal is labeled. Look for this label on
the lump" "Mined and shipped only by the
Victor-American Fuel Company Denver."
On the red background within the white cir-
cular border are these: "I am sunshine-
Maitland" "For heat without soot get
nigger head”—
"For a hot clean fire get Pinnacle." In each
a picture of a shovel of coal is across the
label at its approximate center. In its ad-
vertising matter the appellant used certain
words claimed as slogans, as inducements to
the purchase of its coal. It first began to use
these trade-marks and slogans in 1916.

Appellee, Huerfano Agency Company, is the sales agent for the other defendants-ap

pellees, who produce coal in Colorado and put it on the market in that and adjoining States through their agent. In their answer they deny infringing appellant's trade-marks, deny unfair competition and allege that the

23 F.(2d) 74

Agency Company has for many years been using its trade-marks, which it filed in the United States Patent Office, in advertising and selling coal, using its trade-marks in the same way that appellant uses its trade-marks. The Agency Company's trade-marks, which it began using about 1918, are also circular labels, their predominating color being red or black. On the red or black background and across the center of its labels is the word "HACO," a combination of letters in its corporate name. These letters are in white on the red or black background. Above them and below them are white or red fields, the upper one being bounded by a straight line on its lower side and a semi-circular line on its upper side, and the lower one bounded by a straight line on its upper side and a semicircular line on its lower side. In the upper field is the word "COLORADO" in red letters, if the field be white, and in black letters if it be red, and in the lower field the word "COALS" is in red letters if the field be white, and in black letters if it be red. These letters are much larger in the middle of the words and grow smaller to each side, and are unusual in form. The Agency Company also uses phrases in its advertisement, but wholly different from appellant's claimed slogans. They call attention to the word "HACO" on the Agency Company labels. Some of the obvious and marked differences between the labels are these: (a) Appellee's do not contain a picture of a shovel full of coal prominently displayed; (b) nor are its labels encircled by a white border or band; (c) nor do they contain black letters describing the coal; (d) nor black letters on a white border; (e) nor words describing the quality or origin of the coal; (f) nor the name of the mine from which produced; (g) nor the name of the company producing it as do those of appellant. Appellant's trade-marks do not display the word "HACO," and they do not display the words "COLORADO""COALS," which are shown in unusual style of type on appellee's labels. Appellant's labels do not show a semi-circular background above and below a differently colored strip between them, as do appellee's. Each of appellee's labels contains but three words, displayed in comparatively large lettering for the size of the label, while each of appellant's contains a large number of words, all in plain ordinary type. The first impression gained at a mere glance, as well as the permanent and lasting one obtained from close inspection, marks a great difference in appearance between the trade-marks of appellant and those of appellee. The shovel of coal on appellant's is strikingly distinctive,

and the difference in collocation of all features that have been separately noted clearly distinguishes those of appellant from appellee's. There is no claim that appellee's trademarks are copies of appellant's; it is only argued that they are colorable imitations or simulations, that the shape, coloring and general appearance are in such near resemblance to appellant's as to likely deceive the public and induce an acceptance of appellee's labeled coals believing them to be the product of appellant; and in this way appellee Agency Company is infringing on appellant's trademarks and engaged in unfair competition in the sale of coal. There is no proof that customers were ever misled and confused and took any of appellee's, trade-marks for those of appellant, or vice versa; it tends to show the contrary, that the differences were easily observed.

[2] The proof shows that other producers and dealers in coal in the territory in which appellant's coal finds a market had been engaged in the same practice many years prior to appellant, they had filed and were using trade-marks to distinguish their coal and were using them in the same way. Their labels were circular in form and some of them contained red as the predominant color, with lettering designating a name for the coal and some the name of the dealer and its place of business. It was shown that a circular form of label was the most practical form for pasting on coal, cars and wagons. They were not as likely to become loosened and displaced as they would be if they had corners. It was also shown that red was the most practical color for use, not being so easily effaced by dirt and coal dust. However, some of the labels in use prior to the time appellant began using its labels did not predominate in red but in other colors. They were substantially of the same form and size as those later used by appellant and appellee Agency Company. This prior use by others in the same trade would seem to exclude any right to a monopoly in the shape and color of the labels. Leschen Rope Co. v. Broderick, 201 U. S. 166, 26 S. Ct. 425, 50 L. Ed. 710; Viavi Co. v. Vimedia Co. (C. C. A) 245 F. 289; Taylor v. Bostick (C. C. A.) 299 F. We think the claim of colorable imitation cannot be sustained on the record. No careful inspection is required to distinguish the trade-marks. Ordinary attention by a purchaser is all that is necessary for that purpose. One who exercises ordinary care and caution could not be misled and deceived and thus induced to accept appellee's labeled coal believing it to be the coal of appellant. Specific differences are marked and the gen


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