although there may have been no net earnings out of which to pay it; but the law proceeds upon a presumption which disregards what is merely exceptional. And we have no hesitation in saying that, in reference to a dividend declared as of earnings for the current year and paid as such to stockholders, whether in money or in scrip, no proof would be admissible, for the purpose of avoiding the tax, that no earnings had in fact been made. The law conclusively assumes, in such a case, that a dividend declared and paid is a dividend earned. It follows, also, from this view of the purpose of the law, that a fund taxed in one year as the profits of a railroad company, used for construction or carried to the account of any fund, has been taxed once for all, and cannot, as part of the earnings of the company, be assessed a second time. The tax for the year is upon the whole amount of the net earnings, distributed and enumerated under the heads pointed out in the statute, and when the tax has been imposed and collected upon them, or any specific part of them, there is no authority to levy any further additional tax. The profits that this year have been taxed as undivided, and invested in any corporate asset, if in the succeeding year it is embraced in a dividend declared and payable to stockholders, have already borne all the burden imposed by the law, and cannot again be subjected to an assessment for a new tax. There has been a difference of opinion upon the point, whether the tax imposed by this section is upon the corporation on account of its net profits, or upon the income of the stockholder or bondholder, although in the present case it is immaterial which of these alternatives is adopted. We are not aware, however, that it has ever been suggested, until now, that it might be both in succession; one year a tax upon the income of the corporation, and the next upon the same fund as the income of the individual. We do not think this an admissible construction.

It is necessary, in the application of these principles to the circumstances of the present case, to regard the special character of the certificates in question. It will be seen that they do not purport to be a declaration of a dividend as of the earnings of the company during the year in which the tax was assessed, or, indeed, for any particular year or series of years. The recital is that the company "has hitherto expended of its earnings, for the purpose of constructing and equipping its road, and in the purchase of real estate and other properties, with a view to the increase of its traffic, moneys equal in amount to 80 per cent. of the capital stock of the company." quite legitimate for the assessor to treat this as evidence of an amount

It was

of earnings which had never been taxed, and make the assessment accordingly. It was equally legitimate for the secretary of the treasury, upon proof that the accumulation had been going on from the organization of the company, in 1853, to apportion the amount in equal proportions for each year, and to deduct nine-fifteenths thereof for the years which had elapsed before the taking effect of the act taxing incomes. And it is entirely consistent with the declaration itself to show in point of fact what was the amount of earnings accrued during the period while the income-tax act was in force which had not been assessed for taxation as profits carried to construction or other account. The declaration in the certificates could not be conclusive of anything not inconsistent with it, for an estoppel only prohibits contrary allegations. The proof admitted on the trial below did not contradict the certificates, but only served to rebut a presumption, which, as matter of law, was not conclusive. Its tendency and effect were to exact from the company the full tax upon every dollar of its earnings, which had not previously paid its proper assessment, and which, in any form, was subject to taxation, and to relieve it only to the extent to which otherwise it would have been subjected to the payment of a second tax upon the same fund. This result, and the process by which it was reached, seem to us strictly to conform both to the letter and spirit of the law governing the subject.

This conclusion disposes of the substance of the case, as it sustains the rulings of the circuit court upon the main question. There were other exceptions to the charge, and to the refusal of the court to give instructions asked for by the plaintiff in error; but they are either covered by what has already been said, or seem to us not necessary to be specially mentioned. A point was raised as to certain items claimed to be included in the sum for which these certificates were issued, which, in the view we have taken, becomes immaterial; for, as we have decided that the jury could only consider the earnings realized in fact during the operation of the law from 1862 to 1869, it was immaterial what items existing prior to that period were also included in the aggregate sum for which the certificates were issued. Some exception also was taken to some comment on the part of the circuit judge as to the state of the evidence, but, in our opinion, the question which the jury had to decide was left to them fairly.

We find no error in the record, and the judgment is accordingly affirmed.

(106 U. S. 423)

MOFFITT v. ROGERS and others.

(October 30, 1882.)

PATENTS FOR INVENTIONS-CLAIM IN REISSUE VOID.

Where the specification in a reissued patent covers a contrivance essentially different from that described in the original specification and claim, the claim in the reissue is void.

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

This is a suit in equity brought for the infringement of reissued letters patent, dated December 8, 1874, granted to the complainant, John R. Moffitt, for an improvement in the manufacture of heel stiffeners for boots and shoes. The original patent bore date May 21, 1872.

Heel stiffeners or counters, as they are sometimes called, were formerly made by hand, the leather being shaped upon the last while wet by the blows of the shoemaker's hammer. Previous, however, to the date of the complainant's original letters patent ready-made moulded counters were manufactured by placing the counter-blank across the opening of the mould and forcing it into the mould by a plunger or former, or by placing the blank upon the back of the stationary former, and forcing it around the former by the pressure of the mould. Counters had also been shaped on machines by which a rolling pressure was applied. As early as 1853 machines known as the Nichols were employed. This machine had a rotating "former, circular in cross-section, which was applied by pressure to another circular roller, conforming to this "former" longitudinally, the object being to set leather into the proper shape either for soles or heel stiffeners.

In the specification of his original patent Moffitt declared:

"In moulding to shape ready-made counters or stiffeners for heels of boots and shoes made of various materials, but usually of waste bits of leather, a difficulty exists, by reason of the peculiar shape, in getting an equal or sufficient pressure upon all parts of such counter so as to get uniform hardness throughout, and also another difficulty in getting a true and proper permanent form throughout all parts of the same counter, some of it, especially in leather, being of a more spongy nature than other parts. This difference or lack of homogenity prevents a uniform solidity, and precludes the true preservation of the shape which a mould may impart.

"The object of my invention is not only to make more perfect ready-made counters than can be made by any moulding process, but also to make a new

article of manufacture, viz., a 'rolled' counter, prepared, solidified, and uniformly hardened and set to shape by rolling pressure, such rolling action producing a new as well as better article, and admitting of producing the same from material hitherto found too intractable, such as leather board, sheet metal, etc. Instead, therefore, of shaping the stiffener in mould, I employ no mould of any kind, but use a moving former, A, devised by me, of a shape adapted to give the desired shape to the counters, and set eccentrically on a shaft, B, the shaft being arranged to have a continuous or reciprocating rotary movement, either by hand or by power as described. Beneath this former I place a roller, C, having a profile as shown, the converse of and conforming to that of the former,' the shaft of the roller having its bearings in the main frame, D. The shaft of the former has its bearings in a swing-frame, E. F is a treadle-strap, whereby the swing-frame may be pulled down to give any required degree of pressure, and which also permits the eccentric former to rise and fall, as in its movements it rides and rolls over the surface of the counter, the counter-piece being placed centrally upon the 'former' and being rubbed and rolled as well as squeezed between them while being brought into shape.

"The 'former,' as will be seen, projects further from its axis on one side than on the other, so as to conform nearly to the general form of the curves of the inside of a shaped counter. This gives a rolling action in addition to the squeezing over the whole body of the counter."

The cross-section of the "former," as shown by the drawings and model, was elongated, with one or both ends semi-circular.

The specification proceeds:

"The end, g, of the 'former' need not be a plane, as shown in figure 1, but instead may be rounded at its opposite end, as shown in figure 3, so that it may be continuously revolved and in either direction. In such case I prefer to place the shaft in its center, or equally distant from both ends.

"Instead of a single roll, a pair of auxiliary rolls may be used, as shown in figure 4, one on each side of the single one."

The claims were thus stated:

"I claim (1) the described apparatus for rolling to shape heel stiffeners or counters; (2) I also claim as a new article of manufacture heel stiffeners or counters shaped and compacted by a rolling action, as described; (3) I also claim the process herein described of shaping and setting to shape heel stiffeners or counters by rolling as distinguished from moulding."

The specification of the reissued patent is substantially the same as that of the original patent, with the following exceptions:

For the term "rollers," in the original specification, the words "supports or rollers" are substituted in the reissued specification, and the word "mechanism" in the first claim of the reissue.

In the reissued specification the requirement that the "former" should be set eccentrically on a shaft, and the statement that the

former projects further from the axis on one side than the other, are omitted.

The claims of the reissued patent are as follows:

(1) In a machine for making counters or stiffeners for boots and shoes, a turning or revolving former in combination with mechanism for holding and shaping the blank over it; (2) the revolving or turning counter-former, A, in combination with a supporting roll or rolls for rolling or for rolling and flanging blank stock into heel stiffeners, substantially as shown and described; (3) the process described of forming the heel-seat of a counter by means of a former having a motion about a center, and which gives to the heel-seat a drawing or rubbing action against a flange or bearing surface in addition to the rolling action.

The infringement charged against the defendants was in the use by them of the device described in the reissued letters patent of Louis Coté, dated June 2, 1874.

The specification of this patent declares:

"The invention or machine consists of a rotary head of a spherical, spheroidal, or sphero-cylindrical shape, fixed upon and concentrically with a rotary shaft, in combination with a stationary mould correspondingly or approximately so concaved, whereby, by the revolution of the said rotary head within the mould, a piece of leather of suitable form introduced between them may be drawn into and through the concavity of the mould, and receive a curved form lengthwise and withdrawn, and thereby be adapted for use as a stiffening for a boot or shoe."

A clear idea of the contrivance covered by the Coté patent may be derived from the drawings which illustrated the specification.

On final hearing of the cause the circuit court dismissed the bill and the complainant appealed.

Geo. Harding and W. A. Macleod, for appellant.

T. L. Wakefield and Chauncey Smith, for appellees.

WOODS, J. The evidence leaves no doubt in our minds that the first claim of Moffitt's reissued patent is broader than any claim of his original patent. The original patent covered an elongated heelshaped former, set eccentrically upon its shaft. This was an essential part of the invention described in the original patent. The specification declares: "I use a former,' A, of a shape adapted to give the desired shape to the counter, and set eccentrically on the shaft, B." The "former" shown by the drawings is elongated and heel-shaped in cross-section. The specification further declares: "The former,' as will be seen, projects further from its axis on one side than on the other, so as to conform nearly to the general form of the curves of the inside of the shaped counter. This gives a rolling