profits which accrued to the wrongdoer by his adoption of a garb for his goods to which another has a prior and better right. In each class of cases the offender seeks to benefit by the reputation of the other, the object being to palm off his goods as the goods of the other. The nature and extent of the injury is substantially the same. The remedy for the enforcement or protection of a trade-mark right or against unfair competition involves the same mode of procedure and ends in the exercise of the restraining power of a court of equity, and the award of such damages as may have been sustained or the profits of the wrongdoer it is presumed would have accrued to the person whose rights were invaded. Judge Wheeler in Milling Co. v. Rowland (C. C.) 27 Fed. 24, succinctly states the rule by which profits are recovered where the goods were sold in infringement of trade-mark rights. He says:

"It is argued that the evidence does not show that the orator would have made this profit if the defendants had not. This might be true, and not affect the rights of the parties. If the defendants made profits by their invasion of the orator's rights, the orator is entitled to them whether the same profits would have been made by the orator or not, and not to any more if they would, for the same profits could not be made by both."

In Lever v. Goodwin (1887) 4 Rep. Pat. Cas. 507, a suit finally decided on the ground of unfair competition, it was contended by defendants, as here, that a complainant must be limited to a recovery of such profits as were actually and fraudulently diverted from him to defendant; that complainant must establish affirmatively a fraudulent sale to each purchaser; or, to state it more comprehensively, that the account should extend only to such profits as arose from the sale of the soap powder which could be shown to have actually deceived a purchaser. That position was not there sustained, nor can it be in the case at bar. It has never been the rule in assessing damages or loss of profits resulting from an unfair use of a trade-name or violation of a trademark. In the case last cited it was held, Lord Justice Cotton speaking for the court, that inasmuch as the sale of the goods to the middleman, so dressed as to deceive, was a wrongful act, the defendants must account in the profits which they have made in the sale of the simulated goods. See, also, Edelsten v. Edelsten, 1 De Gex, J. & S. Ch. 185, where it was held that the owner of a trade-mark will not be deprived of his remedy in equity even though it appear from the proofs that all who bought defendants' goods were aware that the goods were not of complainant's manufacture. In Graham v. Plate, 40 Cal. 593, 6 Am. Rep. 639, the court said that the difficulty was in ascertaining what proportion of the profit is due to the trade-mark and what to the extrinsic value of the commodity. As it was difficult of ascertainment, the owner of the trade-mark was awarded the whole profit. It appeared to the court that such a disposition of the profits was justified by reason of the fraudulent acts of the defendant. In Untermeyer v. Freund (C. C.) 50 Fed. 80, it was held that where a patentee's profits are mixed within an infringer's, so as to make it impossible to apportion them, the loss falls upon the guilty and not upon the innocent. The expression of the circuit court of appeals in the decision of the complainant's proceeding against the Bell Com

118 F.-7

pany, 23 C. C. A., at page 563, and 77 Fed., page 878 of the opinion, where a quotation is made from Lever v. Goodwin, supra, seems to indicate the adoption of the rule there stated in assessing lost profits.

The exception based upon the master's failure to allow 72 cents per box for manufacturing expenses is without merit. It appears clearly by the proofs that no one was employed by defendants solely in the production of soap powder. The men were employed to manufacture soap, and incidentally, at the direction of the defendants, put up soap powder in the infringing packages. The packages were then boxed and delivered to a middleman, who supplied the consumer. The manufacture of soap and soap powder was done simultaneously; the same receiving room for stock or raw material was used for handling both commodities; the business was not distinct; the accounts were not separately kept. It does not appear that there was any additional expense by reason of the manufacture and sale of the soap powder other than was allowed by the master. The language employed in the case of Société Anonyme v. Western Distilling Co. (C. C.) 46 Fed. 922, may with propriety be applied:

"When an unlawful business is carried on in connection with the defendant's regular business, and the same agencies are employed in doing that which is lawful and that which is unlawful, no rule of law of which, I am aware requires any deduction for expenses in estimating the profits of the unlawful business. In this case the defendant was a distilling company. It has a place of business, a license for doing business, traveling salesmen, etc. The proof does not convince me that any additional expenses were incurred by the defendant in the manufacture and sale of Benedictine, other than such as the master has allowed. The manufacture of Benedictine was carried on in connection with its ordinary business by the usual number of employés. The unlawful venture increased the gross profits without swelling the gross expenses."

As the testimony of Gunnell, defendant's business manager, satisfies me that the manufacture of the soap powder was carried on without increasing the ordinary expenses of the manufacture of soap other than allowed by the master, no reason appears for disturbing the finding. The only questions which are deemed necessary to consider are those raised by the exceptions to the report of the master. Such exceptions are overruled.

The report of the master is confirmed, with costs.

UNITED STATES v. LAIR.

(District Court, E. D. Arkansas, W. D. October 23, 1902.)
No. 2,339.

1. PUBLIC LANDS-SOLDIER'S ADDITIONAL HOMESTEAd-Nature of Grant.
An application for the entry of a soldier's additional homestead, under
Rev. St. § 2306, is not made under the homestead laws, but such grant
is in the nature of a bounty to the soldier.

2. PRESENTING FALSE CLAIM AGAINST UNITED STATES ACTS CONSTITUTING OFFENSE.

Under Act July 1, 1890 (26 Stat. 209), which authorizes any officer authorized to administer oaths for general purposes in the state, city,

or county where he resides to administer oaths to all affidavits and declarations to be made or used in any pension or bounty case, a notary public having authority to administer oaths under the laws of the state may take affidavits to be used in support of an application for the entry of a soldier's additional homestead, and the presentation of false proofs and affidavits, purporting to have been sworn to before a notary in support of such an application, if done willfully and fraudulently, constitutes the offense of presenting false evidence in support of a claim against the United States, within Rev. St. § 5438.

Prosecution under Rev. St. § 5438, for presenting false evidence in support of a claim against the United States. On demurrer to indict

ment.

W. G. Whipple, U. S. Atty.

Morris M. Cohn, for defendant.

TRIEBER, District Judge. The defendant was indicted under the provisions of section 5438, Rev. St. U. S., charged with having unlawfully, willfully, and falsely made and caused to be made a certain claim upon and against the government of the United States for the purpose of defrauding and obtaining from the United States 80 acres of the public lands of the United States as a soldier's additional homestead, under section 2306, Rev. St. U. S., on behalf of one John A. Black, a soldier of the United States in the late Civil War, which claim was caused to be presented by the defendant to the commissioner of the general land office of the United States, an officer of the United States. The falsity of the claim is charged to consist in the fact that the defendant certified as a notary public that the soldier, John A. Black, and two other parties as witnesses appeared before him and made the proofs as required by law, when in truth and in fact none of them ever appeared before him, and the affidavits thus certified to by the defendant were absolutely false.

The ground of demurrer is that the laws of the United States do not authorize a notary public to administer the oath in such cases, and for that reason the government could not have been defrauded, as no entry could be made for such additional homestead entry upon proofs verified before a notary public. It is conceded by the government that, if a notary public is not authorized to administer the oath in such cases, no officer of the government could have granted the application, and for this reason the indictment could not be maintained.

There is no law of the United States authorizing a notary public to take the proofs and administer the oath in homestead cases, but by the provisions of the act of congress of July 1, 1890 (26 Stat. 209), any officer authorized to administer oaths for general purposes in the state, city, or county where such officer resides is authorized to administer oaths to all affidavits and declarations to be made or used in any pension or bounty cases. The question, therefore, to be determined in this case is whether a soldier's additional homestead is to be treated as an application for a homestead under the homestead laws of the United States, or in the nature of a bounty or gift extended by the government to its soldiers in the War of the Rebellion.

In Barnes v. Poirier, 12 C. C. A. 9, 64 Fed. 14, this question was before the circuit court of appeals for the Eighth circuit, the question

being whether the right to land additional to a homestead, granted by section 2306, Rev. St. U. S., was assignable before the additional land was entered. Judge Sanborn, in delivering the opinion of the court, carefully reviewed all the legislation on that subject, and the conclusion reached by him was that this is not a homestead entry, but a mere gift or bounty. The learned judge in his opinion says:

"This brief review of the legislation which has resulted in the existing provisions of the homestead law clearly shows that the purpose and policy which inspired the grants in sections 2289-2291, 2304, 2305, were the very opposite of those which inspired that in section 2306. The purpose of the former was to induce the permanent settlement of the donee upon, and the continued occupation and cultivation by him of, the land granted. Hence the requirements of settlement, cultivation, and occupation for a long period of time before entry, and of the affidavit of the homesteader at the time of final entry that he had not alienated any of the land, and hence the inevitable conclusion that any sale or contract of sale of the right to enter the land or of the land to be entered under these sections was an evasion of one of the main purposes of the act, and was against public policy and void. Anderson v. Carkins, 135 U. S. 483, 10 Sup. Ct. 905, 34 L. Ed. 272. But the beneficiary of the grant under section 2306 had already selected, settled upon, cultivated, and acquired his homestead from the public domain, and was presumably in the occupation of it before that grant was made. The purpose of the grant under that section surely was not to induce him to abandon his homestead, and make a new settlement on the new grant. It was rather to reward him for the services he had already rendered as a soldier in suppressing the Rebellion, and as a farmer in establishing his home upon, cultivating, and occupying that portion of the public domain he had already entered as his homestead. Hence it was that no settlement, no cultivation, no occupation, no affidavit of nonalienation, no affidavit at all was made a condition precedent to the enjoyment of the benefits of this grant or to the entry of the additional land under this section. The beneficiary was left free to select this additional land from any portion of the vast public domain described in the act, and free to apply it to any beneficial use that he chose. It was an unfettered gift in the nature of compensation for past services. It vested a property right in the donee. The presumption is that congress intended to make this right as valuable as possible. Its real value was measured by the price that could be obtained by its sale. The prohibition of its sale or disposition would have made it nearly, if not quite, valueless to a beneficiary who had already established his home on the public domain. Any restriction upon its alienation must decrease its value. We are unable to find anything in the acts of congress or in the dictates of an enlightened public policy that requires the imposition of any such restriction." 12 C. C. A. 12, 64 Fed. 17.

The same question came before the supreme court of the United States in Webster v. Luther, 163 U. S. 331, 16 Sup. Ct. 963, 41 L. Ed. 179, and the same conclusion was reached by that court, citing with approval Judge Sanborn's opinion, and also that of the supreme court of Minnesota, from which court that case was removed to the supreme court of the United States by writ of error. The reasoning of the courts in those cases is so clear and convincing that it is useless for this court to add anything. If this right to an additional homestead is a bounty, then under the act of 1890, above quoted, a notary public is authorized to administer the oath, as the laws of the state of Arkansas, where he resided, vest him with that power.

The demurrer must therefore be overruled.

In re HERZIKOPF.

(District Court, S. D. California. S. D. July 21, 1902.)

No. 1,587.

1. BANKRUPTCY-INVOLUNTARY PETITION-VERIFICATION.

Bankr. Act 1898 does not require a petition in involuntary bankruptcy to be verified by the creditor personally, but such verification may be made by his attorney, who has knowledge of the facts; and no other evidence of the attorney's authority need appear than the fact that he has been admitted to practice in the circuit or district court, as required by general order No. 4.

2. SAME-PROCEDURE-OBJECTION TO VERIFICATION OF PETITION.

Where the verification to a petition in involuntary bankruptcy by an attorney at law or agent is good upon its face, the objection that it was in fact without authority must be made before answering to the merits; otherwise it is waived.

3. SAME-PETITIONING CREDITOR-QUALIFICATION.

A creditor may be a petitioner in bankruptcy, notwithstanding the receipt of a preference which he has not surrendered.

In Bankruptcy. On review of report of referee.
Dunning & Craig, for petitioners.

Lawler & Allen, for certain creditors.

WELLBORN, District Judge. 1. The verification to the creditors' petition is, on its face, sufficient. In re Chequasset Lumber Co., 7 Am. Bankr. R. 87, 112 Fed. 56. See, also, In re Simonson, I Am. Bankr. R. 197, 92 Fed. 904, and Bank v. Craig, 6 Am. Bankr. R. 381, 110 Fed. 137. The bankrupt act does not require a petition in involuntary bankruptcy to be verified by the creditor personally, although, where the creditor is present, and the facts are within his knowledge, he doubtless ought to make the verification. Section I of said act, however, contains this definition:

"Creditor shall include any one who owns a demand or claim provable in bankruptcy, and may include his duly authorized agent, attorney or proxy.” General order No. 4, which is in line with said definition, is as follows:

"(4) Conduct of Proceedings. Proceedings in bankruptcy may be conducted by the bankrupt in person in his own behalf, or by a petitioning or opposing creditor; but a creditor will only be allowed to manage before the court his individual interest. Every party may appear and conduct the proceedings by attorney, who shall be an attorney or counsellor authorized to practice in the circuit or district court. The name of the attorney or counsellor, with his place of business shall be entered upon the docket, with the date of the entry. All papers or proceedings offered by an attorney to be filed shall be indorsed as above required, and orders granted on motion shall contain the name of the party or attorney making the motion. Notices and orders which are not, by the act or by these general orders, required to be served on the party personally may be served upon his attorney."

This order seems to give to the attorney of a bankrupt or creditor power to do any act in the bankruptcy matter which the bankrupt or

13. See Bankruptcy, vol. 6, Cent. Dig. §§ 99, 100, 103.