of the first part, under this agreement, shall not, at the end of two years from the date hereof, amount to the sum of at least 350 pounds sterling, or should the said party of the second part, his legal representatives or assigns, fail to comply with the conditions and agreements herein contained, or any of them, then the said party of the first part, his legal representatives and assigns shall have the right to recover all the right, title and interest in said letters. patent, and the same shall revert to him, his legal representatives and assigns, upon notice in writing to that effect being served upon said party of the second part, his legal representatives and assigns." Under this agreement, and according to its terms, the Duff Patents Company conducted the business, for more than a year, devoting itself to the sale of licenses to manufacturers and users, and to widening and increasing the use of the patented invention. They then commenced themselves manufacturing the gas producers, for the reason, as they allege, that their customers preferred to buy producers already manufactured, with the license cost included in the price of the producer. The business was so conducted until 1899, when A. B. Duff, owing to ill health, retired from the business, and assigned his interest to the defendant, Gilliland, who, with complainant's consent, became trustee under the agreement.

During the period up to 1899, and afterwards, there was voluminous correspondence between the complainant in England and the Duff Patents Company. In this correspondence, are letters in which complainant objects to the patents company engaging in the manufacturing business, charging that by so doing they decreased the sale of licenses, and restricted the general use of the patented invention. The improvement in the general business of the country, however, had conduced to the prosperity of the patents company, as is evidenced by letters from the complainant, congratulating the company on the returns made to him and the increasing success of their undertaking. After 1900, however, dissatisfaction was evinced by complainant, and disagreement between the parties. finally culminated in complainant coming to this country in 1903. Claim was made by him that he was entitled, as his proportionate share, to one-third of the profits of the manufacturing business carried on by the company; that the agreement between them did not contemplate or authorize the patents company entering into the manufacturing of the gas producers, and that engaging in such business made it to the interest of the patents company, his trustee, to curtail the sale of licenses and to confine the use of the patent to the business transacted by said company; that such a course tended to increase the profits of the company at the expense of the complainant, and that as these profits were made outside of the scope of the agreement, and in violation of the true meaning and purpose thereof, these profits, or a due proportion of them, should be accounted for to the complainant. A bill was filed upon this theory, in which it was alleged, in addition, that the defendants had refused to allow the complainant an inspection of their books and accounts, showing all their transactions in relation to the licenses of his patent, and prayed (1) that an account might be taken, and

the defendants decreed to pay to complainant one-third of all the profits and benefits of the entire revenue made by defendants in the granting of licenses and the manufacture and sale of the patented gas producers; (2) that Gilliland, one of the defendants, as trustee of the legal title, be ordered to reassign unto complainant the entire right, title and interest in and to said letters patent, and that said agreement may be canceled and declared null and void.

In the testimony, there was evidence tending to show that license. fees had been collected and not accounted for in full to complainant, and that the licenses for gas producers manufactured and sold by the patents company were charged to it at a less rate than those charged to outside parties, and that this practice, which resulted in the loss to complainant of a large sum, to wit, of $8,000 or thereabouts, had been concealed from the complainant, or at least that no knowledge of the same had come to him until the taking of the testimony Leave to file an amendment to the bill, setting forth these alleged fraudulent practices, was thereupon asked for and allowed, and the trial proceeded upon the original bill so amended, and the answers thereto.

Although the contention of complainant, that the business of manufacturing gas producers, as engaged in by the patents company, was outside the scope of its agreement with the plaintiff, and unauthorized thereby, and that there was, on that account, an equity in the plaintiff to have an accounting of the profits arising from such business, and a decree for the payment of a due and proportionate share thereof, is not without merit, we incline to agree with the court below that the correspondence between complainant and the patents company shows a sufficient acquiescence on the part of the complainant, in this mode of conducting business under the agreement, to estop him from now objecting thereto.

The bill, as amended, distinctly, and with the requisite specification, charges fraud. Sufficient evidence has been adduced, as to suppression of facts in regard to the amount of license fees collected and not accounted for, and undercharges in license fees due for producers made by the defendants, accompanied by a refusal to make full disclosure of the books and accounts of the said company, to clothe the complainant with a right to pursue defendants for redress in some form of action. Indeed defendants do not deny that this constitutes sufficient ground for a suit for damages at law. They deny, however, that any ground for equitable relief is furnished thereby. In this, we cannot agree.

Apart from the question of fraud, as a ground of equitable jurisdiction, the difficulty is in the view taken by the defendant and sustained by the court below, that the relation existing between the complainant and the Duff Patents Company was simply and solely the legal relation arising from the transfer, absolute in its terms, of complainant's patented right to A. B. Duff, ignoring the trust which we think attached to the legal title. Of course there was an absolute conveyance and transfer of all the right, title and interest of the complainant, in and to the patent in question. Nothing less than this would have served the purpose of a trust, however ex

pressly created. That the whole legal title to a particular property should be in one person, with a special confidence reposed in him to apply the property faithfully and according to such confidence, for the benefit of another, amounts to the definition of a trust. The agreement of August 6, 1894, in terms constituted A. B. Duff trustee for the members of the Duff Patents Company, including himself. It is argued by defendants' counsel, that this is the only trust created by that instrument. It will be observed, however, that it is a passive and naked trust, and the clear purpose and intent gathered from the instrument itself, is that the Duff Patents Company, as well as A. B. Duff, the nominal trustee, were to administer the business in connection with the patent assigned, and consequently were affected by the trust and confidence expressed in the later paragraphs of the writing, to which we have already referred. The express trust thus created would, under the strictest construction. constitute the defendant company, as well as Gilliland, the successor of A. B. Duff, trustees at least for the one-third of the license fees collected by them, or which they were in duty bound to collect. But the scope of a trust as to property whose title has been absolutely conveyed, may be defined by writings and correspondence between the parties with reference to the subject-matter of the trust. Writings of this character are found in the correspondence set out in the record; and we especially note the letter of July 22, 1894, written by the Duff Patents Company to the complainant, with reference to this very agreement. It seems to us to throw a flood of light upon the real purpose of the conveyance of the title to the patent, and show that it was not intended to enlarge the rights of the defendants, or diminish those of the complainant as they existed under the agreement first drawn and submitted to the counsel of Swindell & Bro., as referred to in said letter.

The administration of such a trust is, of course, a primary head of equity jurisdiction, and an accounting an ordinary mode of equitable procedure. We agree with the court below in thinking, that the cancellation of the agreement and the reconveyance of the patent, as prayed for, should not in this case be granted, but we do think there should be an accounting for the licenses that have been granted by the defendants, and the fees collected therefor, including those collected from infringers, with or without suit, and those charged by the defendants against themselves for gas producers manufactured under the patent by the defendants. Equity and good conscience clearly require that these defendants, as trustees of these license fees, should be charged with the highest rate ever collected from outsiders for similar articles.

The decree of the Circuit Court is reversed, and the case will be remanded for further proceedings in accordance with the views. expressed in our opinion.

SLOAN FILTER CO. v. PORTLAND GOLD MIN. CO.
(Circuit Court of Appeals, Eighth Circuit. June 22, 1905.)

No. 2,008.

1. PATENTS--PATENTABLE INVENTION-EMPLOYMENT OF MECHANICAL SKILL. The result of the application of the common skill and experience of a mechanic, which comes from the habitual and intelligent practice of his calling, to the correction of some slight defect in a machine or combination, or to a new arrangement or grouping of its parts, tending to make it more effective for the accomplishment of the object for which it was designed, not involving a substantial discovery, nor constituting an addition to our knowledge of the art, is not within the protection of the patent laws.

[Ed. Note.-For cases in point, see vol. 37, Cent. Dig. Patents, § 17.] 2. SAME IMPROVEMENTS NOT PATENTABLE.

The mere use of known equivalents for some of the elements of prior structures, the substitution for one material of another known to possess the same qualities, though not in the same degree, and the mere carrying forward or more extended application of the original idea, involving a change only in form, proportions, or degree, and resulting in the doing of the same work in the same way and by substantially the same means, are not patentable, even though better results are secured; and this is the case, although what preceded rests alone in public knowledge, and not upon patent.

[Ed. Note. For cases in point, see vol. 37, Cent. Dig. Patents, § 23.] 3. SAME-EQUIVALENT PARTS-COMBINATION PATENT.

The doctrine of equivalents applies to patents for a combination, although the measure of its effect in the particular case depends upon the position of the patent in the art to which it relates.

[Ed. Note. For cases in point, see vol. 37, Cent. Dig. Patents, § 28.]

4. SAME-INVENTION-BARREL FILTER.

The Sloan patent, No. 587,874, for a barrel filter for use in the filtration of precious metal solutions, as in the chlorination process, is void for lack of patentable invention; the elements of the combination being old, and the device of the patent differing from those of the prior art only in the substitution of equivalent parts or materials, or in improvements requiring only the exercise of mechanical skill.

Appeal from the Circuit Court of the United States for the District of Colorado.

This is an appeal from a decree dismissing the bill of complaint in a suit to restrain the infringement of a patent. The appellant, the Sloan Filter Company, sued as the successor in title to Edward D. Sloan, patentee in letters patent No. 587,874, issued August 10, 1897, for improvements in barrel filters for use in the filtration of precious metal solutions, as in the chlorination process.

The claims of the patent are:

"(1) In a barrel filter, the combination with a suitable barrel or cylinder, of a flat perforated floor, a sheeted filtering medium flatly laid thereon, a wooden framing for said floor, composed of lateral and longitudinal parts spaced and united by appropriate mortising, a grating overlying the filtering medium, a series of lateral tie bars on said grating, abutments at the sides of the interior of the barrel overlying the ends of the tie bars, and wedges which are tightly interposed between said abutments and tie bars, and firmly lock all of the parts of the filter and its framing in position with relation to each other and to the barrel, substantially as described.

"(2) In combination with a suitable barrel or cylinder, a flat perforated lead floor, a framing beneath said floor affording a firm support, as well as suitable space below for the passage of filtered liquid, a suitable sheeted filtering medium flatly laid on said floor and beyond its sides and ends, and a grating

adapted to be firmly clamped for confining the filtering medium upon the floor. and binding its edges against the interior sides of the barrel, and lateral wedge bars, which are actuated by the pressure of the grating and bind the ends of said filtering medium against the interior ends of the barrel, substantially as described.

"(3) In a barrel filter, the combination with a suitable bed or support and a perforated lead floor, of a filtering medium composed of lead in sheeted form, open to the filtering passage of liquid, substantially as described."

A barrel filter, as used in the chlorination of gold ore, and possessing the elements claimed by Sloan to be novel, may be briefly described as follows: A lead-lined steel barrel or cylinder, with cast iron heads, is arranged horizontally, and equipped at each end with trunnions resting upon bearings, so that it may be revolved upon its horizontal axis. Wooden segments or horses, with lower edges conforming to the curvature of the barrel, are placed at intervals along the bottom as a primary support for a floor. The lower edges of the segments are notched to permit of the free flow of liquid along the bottom, and the upper edges are also notched to receive longitudinal stringers, which are correspondingly notched so as to form a mortise. Across the stringers and into notches on the upper side thereof are placed transverse riffles. This arrangement, being entirely composed of wood, constitutes the support for a flat, perforated lead sheet, which is the floor of the filtering medium. The perforations in the lead sheet are approximately five-sixteenths of an inch in diameter and about one-half of an inch between centers. Upon this floor is placed a filtering medium, consisting of sheeted lead with much smaller and more numerous perforations. On top of this are placed wooden gratings or racks, constituting a holding down arrangement, and also designed to prevent the abrasion of the filtering medium beneath. These in turn are held down by transverse wooden binders, extending from side to side of the interior of the barrel; the ends of the binders extending underneath longitudinal beams, which are securely fastened to the sides of the barrel by bolts extending through the shell to the exterior thereof. Between the ends of the binders and the under side of the longitudinal beams are driven wooden wedges, for the purpose of holding the structure more securely in place. For the reception and discharge of the materials and the various parts of the filtering apparatus, the barrel is equipped with suitable openings, which are so arranged as to permit of hermetic sealing.

The operation of the filter in the treatment of gold ore is substantially as follows: The ore being crushed, and generally roasted, is mixed with water, thus constituting a pulp of the proper consistency, and is placed in the barrel upon the structure which has been described. Chlorine gas is then either injected into the barrel or is generated therein by the admixture of sulphuric acid and chloride of lime. The apertures are sealed, and the action of the gas upon the gold-bearing pulp is accelerated by the rotation of the barrel. In due course the gold values in the form of gold chloride are extracted from the pulp, pass through the perforations in the filtering sheet and the lead floor to the space beneath, and are thence drawn off for further treatment. The worthless residuum is then discharged by opening and reversing the barrel.

By the oid method, which preceded the placing of the filter within the barrel, the filtering was generally done in a separate stationary open tank. This method was neither economical nor healthful, so about six years before Sloan's invention there was successfully used a barrel filter, which possessed almost all of the features of the one described in the patent in suit, and in which the chlorination and the filtering were combined in a single operation. In fact, Sloan first received his instruction in the art from the man who designed and successfully operated a barrel filter in 1890. An important consideration in the making of every filter used in that process was the selection of materials that would resist the corrosive action of chlorine gas. Iron was quickly eaten away. Hardwood was also subject to it, but its reasonable duration of life and its abundance rendered its use economical, and, besides, it was best adapted for the supporting and binding framework of the filter. The effect of the gas upon lead was slight. Upon pure asbestos there was practically none. It was also necessary that the parts of the filter be so arranged as to be readily separated and detached, in order that they might be passed out of the manhole when the necessity for repairs or replacement arose.