PRESTON tI. FIRE-EXTINGUISHER MANUJ,"G CO.
PRESTON 'lI. FIRE-EXTINGUISHER MANUF'G
CO. et al.
(Oircuit Court, N. D. illinois. November 5, 1888.)
COURTS-FEDERAL COURTS-VENUE-ACTIONS AGAINST CORPORATIONS.
Under act Congo March 3, 1887, as modified and explained by act August 13, 1888.requiring an action in the federal courts to be brought in the district of which defendant is a resident, a New York corporation. having its principal office in that state, and doing business in Illinois, cannot be sued in the fed i era.l courts in Illinois.
In Equity. On plea to the jurisdiction of the court. Bill by E. B. Prestbn against the Fire-Extinguisher Manufacturing CompallY and others to enjoin the infringement of complainant's patent. Munday, 'Evarts Adcock, for complainant. Banning Banning Payson, for defendants.
J. These cases are now before me upon a plea filed in each ca;qse to the jurisdiction of the court. The plea sets up by way 'of chaJ.}'enge to thejurisdiction of the court the fact that this defendant, the FireExtinguisher Manufacturing Company, at the time of the filing of th.e bill of complaint, was a corporation duly organized and existing under and by virtue of the laws of the state of New York; that it has its principal office, and keeps its books of account, in that city; and that no stockholder, qfficer, or ,director resides in this district or state; that said company was not prior to nor at the date Of the filing of the bill'of complaint an illhabitant of the Northern district of Illinois, or of the state of Illinois. Iil the case of Manufacturing Co. v. Manufacturing Co., 34 Fed. Rep. 818, before me in March last, I had occasion to examine thisq1Jestion,' aild there came to the conclusion that, under the act of March 3, .1887 ,-and the same holds good in regard to the act as explained and niodffied by the act of August 13, 1888,-a non-resident corporation cannot be sued in this district; that is, a corporation not a resident of this ,district cannot be sued here merely by service upon an agent/or officer. :The opinion in that case has been published, and counsel are fauliliar 'with it, So it is hardly necessary to quote from it. It is enough to say that the act of 1887 requires'suit to be brought in the district whereoJ the defendant is an inhabitant, but drops the provision in prior E:ltatiltlis subject, that he may also be sued in any district where he may pe fqund .at the time of the serVIng of the process. I have re-exitl1iined ,. thatques1lionin the light of made by counsel for complainant, and still adhere to the conclusion there announced, that a corporation al).d existing solelyqncIer the laws of another state, and ha'ving its principal office and place of business in another state and .' cannot 'be said to be an inhabitant of this district; and be sued here, even although iluchcorporation may do business in this district through agents, except possibly in cases where the jurisdiction depends solely on citizenship. The agents can undoubtedly be sued here, if the case is such as to make them persoll/tHy liable, or when an injunction is sQughtag.ainst
them. The statute of the state ofIDinois (section 26, c. 32, Rev. St. ID.,) which provides that foreign corporations shall be subject toa11 the liabilities, restrictions, and duties that are or may be imposed upon domestic corporations, I do not think helps the complainant in this case, as it has nothing to do with the question of jurisdiction, or of the tribunal in which suit shall be brought. It simply makes foreign corporations subject to the same liabilities as home corporations. It does not reach the question as to what tribunal you are to go into. The bill charges defendant with the infringement of a patent owned by complainant, and it was stated on argument as to the sufficiency of this plea that defendant has a factory in this district, and manufactures the infringing machines here, and nowhere else, as a reason why defendant may be sued here. It is very plain that if an individual, an inhabitant of another state, owned and carried on this factory, conducting its business through his agents and employes, he could not be sued in this district under the present law; and I see no reason why the same rule is not applicable to corporations of other i'ltates. In other words, it seems to me, a corporation can, bv state comity, carryon business in a state outside of that by which it was created without becoming an inhabitaut of such outside state. The plea in each case is held suffioient.
METROPOUTAN NAT. BANE: 'II. ST. LoUIS DISPATCH
Co; et al.
(Oircuit Court. E. D. Mi8aotlri, E. D. November 21, 1888.)
A mortgage ofthe "machinery. type, presses, cases, furniture, paper, forms, and tools" of a nempaper company, together with the" good-will" of its business. cannot be foreclosed as to the good-will after all the tangible property covered by the mortgage has been alienated, worn out, or destroyed, and the corporation has become consolidated with another newspaper corpuration.
SAME-GOOD-WILIr-SALE OF SAME.
The good-will of a business is property that may be mortgaged or sold in connection with the busincss; but it cannot be sold, by judicial decree or otherwise. unless it be in connegtion with a sale of the business on which it depends, and of which it is a mere incident.
Where a newspaper, whose good-will has been mortgaged, is consolidated with another paper, and the name of the paper is changed, and a new corporation is formed to publish it, the lien, of the mortgage does not attach to the good-will of the consolidated paper, though the new corporation occupied for some years the old place of business, and paid interest for 10 months on the mortgage debt.
Inasmuch as it appeared that membership in the Western Associated Presti can only be sold to publishers of newspapers, and that a transfer of such membership would not entitle the transferee to the privileges of a member unless voluntarily accorded him by the association, held, that a bill would not be entertained to foreclose a mortgage on a certificate of membership or share of stock in such association unless the association was made a party defendant.