stage of interior circulation, and not one which suggests the descending outlet passages with exits to the external air. They are mostly devices for deflecting the heated air through the lumber, or means for taking up the condensed moisture, so that the partially cooled air of the kiln could be reheated and used again. The patent to Morton & Andrews-No. 426,463, dated April 29, 1890has openings at the top of the kiln into a space between the outer and inner walls of the kiln, and, descending in that inclosed space, the air loses its moisture by condensation against the outside wall of the kiln which is of metal, and then, being partially cooled, is returned to the heating coils. This is, in substance, the first stage in complainant's method, except that complainant's kiln does not require an outside covering of metal, and the descending air is inside the inner wall of the kiln, and condenses its moisture on the ground below the heating coils. But there is nowhere suggested in Morton & Andrews' kiln the second stage of the operation of complainant's kiln, or the devices by which the process towards the end is accelerated by the increased circulation caused by a moderate outflow of the air of the kiln, through the downwardly discharging ducts into the open air. With respect to the patent to H. S. Servoss,--No. 469,067, February 16, 1892, we think it obvious that it is only a more elaborate device for providing metallic ducts or passageways for the air from the top of the roof and the sides of the kiln down into the space beneath the heating coils to produce the same result as in the kiln of Morton & Andrews, namely, to maintain an internal circulation with devices for condensing the moisture of the heated air. It has no suggestion of the second stage of complainant's operation by which a slowly-moving current into the open air is established. So far as we can judge from the proofs in the case, this combination found in the complainant's patent was new, and the presumption that it is useful has not been overthrown.

It remains to consider whether the defendant has infringed. The defendant's kiln was constructed by the Moore-Cain Dry-Kiln Com pany under patents granted to Lafayette Moore. The first is No. 524.598, dated August 14, 1894. This patent describes a tight kiln, without openings to the external air except those which admit cold air to the heating coils. It provides for spaces around the lumber for the circulation of the heated air, so that, as it cools, it falls to the bottom of the chamber, and its moisture is absorbed by the earth or sand of the bottom. Its distinctive feature is the earth or sand bottom and the absence of any flues or openings for the escape of the heated air. The advantages claimed are the rapidity of the operation, the moist condition of the whole interior, and consequent lessening of the risk of fire, and the freedom from cracks in the lumber due to the continued moisture. It is expressly stated that the final drying does not take place in the kiln, but only when the lumber is taken out and exposed in the open air. The second patent to Lafayette Moore is No. 554,134, dated February 4, 1896, upon application filed January 12, 1895. Emerson's patent now in suit was issued March 19, 1895, upon application filed June 24, 1894, so that the Emerson patent is prior by near

ly a year. The Lafayette Moore second patent is stated to be an improvement on his first patented kiln, and aims to increase its capabilities by placing inclosed side flues leading from near the top of the kiln down the sides to the bottom near the places where there are openings to the external air. The devices added to the kiln of the first patent were the descending ducts or air passages and the openings to the external air, and these were precisely the two devices which Emerson had already obtained a patent for, and which distinguished his kiln from the prior tightly-closed kilns from which the heated air was not allowed to escape. The difference between the Emerson patent and the second Moore patent is to be found, not in what was done, but in the reason which Moore in his specifications has given for doing it. Emerson had said in his specifications that he introduced the downwardly discharging ducts with external openings for the purpose of carrying off the moistureladened air when it was no longer required, and to produce a moderately increased circulation for the final drying of the lumber while in the kiln. Moore says he introduced the descending air passages in order to conduct the air at the top of the kiln to the bottom, so that there coming in contact with the incoming air flowing in through the new external openings its moisture would be condensed, but its remaining heat be availed of, and he asserts that the movement of air through the new outside openings is all'inward, and none of it goes outward. On the issue of fact as to whether, in the defendant's kiln, there is any outward movement of air from the apertures at the bottom of the descending air passages there is conflict of testimony. The excuse for the conflict may, we think, be found in the testimony of one of the complainant's witnesses, who testifies that there were three apertures, each about two feet square, on each side of the Moore-Cain kilns, like the defendant's; that there were two currents to be observed, one at the bottom of the aperture, flowing inward, and the other near the top, flowing out, and that a handkerchief held fast at the top and free at its lower edge would be affected only by the lower current, and would indicate that the current was all inward. One of the defendant's witnesses testified that the reason these large apertures were cut into the sides of the defendant's kiln was because it had been found in the Moore-Cain kiln that the air which entered the ends was not uniformly distributed, so that the lumber in the middle did not dry as well as that at the ends, because it did not get a sufficient supply of air. This statement is difficult to understand, for this class of kilns are built without outlets except such accidental escapes of air as come from cheap or defective construction. There are four openings, two at each end, for the constant inflow of air to supply this accidental escape. Moore, in his specifications, states that his kiln is practically an air-tight structure, and that the heated air is to be used over again and again without appreciable loss of heat. The chamber is full of air at the commencement of the operation. These four inlets are provided. There are no outlets except accidental cracks, and it is difficult to conceive how three additional openings on each side, each two feet square, could be re

quired to supply the accidental escape of heated air. It seems impossible that, if all that was needed in the Moore-Cain kiln was a freer and better distributed supply of air for internal circulation, some way could not be devised to supply it without making the openings at or near bottoms of the descending side air passages, thereby incurring the risks of this suit, and its great attendant costs and expenses; and it is strange that the Moore-Cain Company, which is defending this suit, should put forward the most technical defenses, and make the most strenuous efforts to exclude testimony, and to have the complainant's patent declared invalid, rather than employ some simple device for supplying the air without the risk of infringement. We cannot escape the conclusion that the descending air passages and the openings into the outside atmosphere at or near their lower ends in defendant's kiln are used, and their use persisted in, because they do produce the same beneficial results produced by the descending air ducts and openings in the complainant's patent. We agree with the learned judge below that the incorporation of the complainant is sufficiently proved, that certain answers of the expert Reid were to be excluded, and we have not regarded the testimony of the witness Ulman, taken after the refusal to allow the complainant further time in which to take testimony. Our conclusion is that claims 3 and 9 are somewhat obscure, and the question of infringement as respects them is not without doubt, but claims 2, 5, and 6 we hold are valid, and that the defendant has infringed them. The decree below is reversed as to the claims 2, 5, and 6 of patent 535,982, with directions to enter a decree finding that the defendant has infringed those claims, and for an injunc tion and an account. The appellee is to pay the costs of this appeal.

(99 Fed. 801.)

BAILEY et al. v. TILLINGHAST.

(Circuit Court of Appeals, Sixth Circuit. February 12, 1900.)

No. 614.

1. NATIONAL BANKS-SUIT BY RECEIVER AGAINST STOCKHOLDERS-JURISDICTION OF EQUITY.

The receiver of an insolvent national bank may maintain a suit in equity to enforce an assessment against stockholders, where such assessment is less than the full amount of their liability; and, where the question of law involved is common as to a number of the stockholders, and rests upon substantially the same facts, they may be joined as defendants. 2. EQUITY JURISDICTION-PREVENTING MULTIPLICITY OF SUITS-JOINDER of De

FENDANTS.

To authorize a plaintiff to maintain a suit in equity against a number of persons, it is not essential that there should be a community of interest between them; but where a common question of law arising upon similar facts is involved between the plaintiff and each defendant, equity has jurisdiction on the ground of preventing a multiplicity of suits.

3. NATIONAL BANKS-LIABILITY OF STOCKHOLDERS-DEFENSES.

It is incompatible with the policy and purposes of the national banking laws to permit mere irregularities, or even fraudulent practices, in the

organization or management of a bank created thereunder, to invalidate its action, and give ground for a stockholder to repudiate his obligations to the public.

4. SAME INCREASE OF CAPITAL-CONCLUSIVENESS OF COMPTROLLER'S CERTIFICATE.

The comptroller's certificate, authorizing an increase of the capital stock of a national bank, is conclusive of the existence of all the facts necessary to authorize such increase in favor of the public and against the subscribers to such stock.

5. SAME VALIDITY OF INCREASE.

By a resolution duly passed, the stockholders of a national bank authorized an increase of $300,000 in the capital stock, and under such resolution defendants and others subscribed and paid for such stock to the amount of $150,000, and received certificates therefor, upon which dividends were paid the same as on the original stock. The names of the subscribers were entered on the books of the bank as stockholders, but the increase was not certified to the comptroller until three years later, the stock being shown during that time in the published statements of the bank as "stock paid in, but not certified." At the end of that time a second resolution was passed, reducing the amount of the authorized increase to $150,000, and directing the same to be certified to the comptroller, which was done, and the increase was approved by him. The bank was then known to be insolvent, and was immediately thereafter closed, and a receiver appointed. Held, that the action of the stockholders in reducing the amount of the increase was legal, and that of the comptroller in approving the increase under the circumstances was proper; that the subscribers became stockholders, and had no equitable ground upon which to repudiate their liability as such to the creditors of the bank.

6. SAME.

A subscriber to an issue of increased stock authorized by a national bank, who was given original stock instead, which fact appeared on the face of the certificate and by the books of the bank, who retains such stock, without objection, for three years, and until after the bank has become insolvent, will be presumed to have known and assented to such change, and is precluded from thereafter asking to be relieved from liability as a stockholder on that ground.

Appeal from the Circuit Court of the United States for the Western Division of the Southern District of Ohio.

This is a suit in equity, brought by Philip Tillinghast, as receiver of the Columbia National Bank of Tacoma, in the state of Washington, an association organized under the national banking act, against 46 defendants, sued as stockholders, for the purpose of recovering an assessment of $61 per share of the stock held by them, levied by the comptroller of the currency upon their personal liability on account thereof, imposed by section 5151 of the Revised Statutes of the United States. The material facts as developed by the pleadings and proofs are as follows:

The Columbia National Bank of Tacoma, Wash., was organized on the 2d day of September, 1891, with a capital stock of $200,000, and thereupon engaged in the banking business at that place. On the 12th day of January, 1892, at the regular annual meeting of the shareholders, by a two-thirds vote, the said shareholders resolved to increase the capital stock of the association in the sum of $300,000. The resolution passed for that purpose was as follows: "(1) Resolved, that under the provisions of the act of May 1, 1886. the capital stock of this association be increased in the sum of three hundred thousand dollars ($300,000), making the total capital five hundred thousand dollars ($500,000). Further resolved, that, as money paid in amounts to fifty thousand dollars ($50,000), or more, the president or cashier be authorized to certify the same to the comptroller of the currency, and shall so continue to certify until the said three hundred thousand dollars ($300,000) is paid in.” Thereupon notice was given to each shareholder of the association, granting

the privilege to each of them of subscribing for such number of shares of the proposed increase of the capital stock as such shareholder was entitled to, according to the number of shares owned by him before the stock was voted to be increased. The shareholders having failed to subscribe for such increase, the books of the association were opened for subscription, and, among others, the defendants subscribed for certain shares of the increased stock, and paid for their subscriptions. Certificates of stock for the amount subscribed by them, respectively, were issued, and received by them, and their names were entered as shareholders in the stock book and ledger of the association. The whole amount of stock so subscribed by the defendants and others, and paid for, amounted to the sum of $150,000. The bank included this stock in its statements published, in accordance with the banking act, as "capital stock paid in not certified"; and dividends were paid by the association in the same manner and to the same extent as dividends upon the original capital stock of the said association, to the defendants among the rest. This $150,000 of stock had all been taken and paid for by the last day of July, 1892, but was not certified to the comptroller as fast as $50,000 thereof was subscribed and paid for; nor was any certificate of the increased stock certified to the comptroller until the 9th day of September, 1895, when twothirds of the shareholders of the said association, acting with the approval of the comptroller of the currency, and at a meeting called for the purpose, voted to modify the said increase of stock of $300,000 by just one-half, making It only $150,000, and the total amount of capital stock, original and increased, $350.000, instead of $500,000. Soon after this the officers of the association certified to the comptroller the fact of said increase of $150,000, and that it had been fully paid. On the 23d day of October, 1895, the comptroller certified in due form that the capital stock of the association had been increased in the sum of $150,000, that that sum had been paid in, and that he approved of such increase. With this certificate the comptroller transmitted the following explanatory letter:

"Mr. W. G. Peters, Cashier, Columbia National Bank, Tacoma, Wash.Sir: Inclosed herewith you will find my certificate, approving the increase of the capital stock of your association from $200,000 to $350,000, with letter to that effect. In connection with these papers, I desire to inform you of my reasons for approving this increase of capital stock. On investigation it appears that a meeting of the shareholders of the Columbia National Bank was held January 12, 1892, at which 1,429 of the 2,000 shares of stock were represented, 1,394 of which were voted in favor of increasing the capital stock. Subsequently, subscriptions to the increased stock were taken to the amount of $150,000, and this amount has been certified by the officers of the bank as having been paid in as permanent capital, their certificates to this effect being dated July 25, 1895. In the meantime it appears that the subscribers to the increased stock have received the same dividends as the other shareholders since the time their money was paid into the bank as capital stock. and that no effort appears to have been made by them to have the increase of capital stock certified to this office in order that the comptroller's certificate of approval might be obtained, and no complaints appear to have been made by them because of this delay, so long as the bank remained in fairly good condition. The published reports of condition of the bank have advertised the amount paid in for increased capital stock as 'uncertified capital,' holding out to the public that the certified capital of the bank, namely, $200,000, had been increased by the amount so published, to which the new shareholders tacitly consented. It must necessarily follow that the patrons of the bank have considered this 'uncertified capital' as a part of the permanent capital of the bank, and have made their deposits with faith in this belief; hence, if the bank should at any time in the future become unable to continue business, it would not appear in any way equitable that the subscribers to the Increased capital stock should be put upon the same footing with the innocent depositors, who have relied upon the credit of the bank as maintained by its published reports of condition. For these reasons I have determined that it is my duty to approve the increase of capital stock in the amount certified by the officers of the bank as having been paid.

"[Signed]

Very respectfully, James H. Eckels, Comptroller."