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tion is to be accomplished with a less quantity of gastric juice than is called for by the foreign patents, as the foreign patents say the crushed fat is to be immersed in the artificial gastric juice; (3) that by the American patent the temperature may be raised above 103 deg. Fahrenheit, 'so that the matter shall completely separate,' while the foreign patents limit the degree of heat to the temperature of the animal body; (4) that in the foreign patents the process of cooling is allowed to proceed to such a point that the mass can be cut in pieces or slices, while in the American patent the product is not allowed to cool so as to become rigid, but is retained at a temperature of about 86 deg. With all due respect to the opinions of these eminent chemists, we must say that the points of difference suggested by their testimony are purely and wholly differences in degree. The necessity of crushing is stated in all the patents, both American and foreign. The degree of crushing would obviously affect the quantity of oil extracted from the fat by the process of digestion, as the only object of crushing is to release the fat from the tissues in which it is held in its natural condition. The necessity for thorough and minute commninution is one that would suggest itself from any operative's common knowledge. Any man who had intelligence enough to know the use of his own teeth would know the necessity of the complete comminution of any article to be subjected to the process of digestion or the action of the gastric juice. It would hardly require a scientist to instruct an operative that the more finely a substance is comminuted the more direct and prompt would be the action of the gastric juice and the process of digestion. As to the differences in the process of digestion between the American and foreign patents, it would seem to be true that the measured quantity of gastric juice directed to be used in the American patent is less than that called for in the foreign patents, because he gives specific directions as to the number of liters of gastric juice for 100 kilogrammes of fat in the American patent, while in the foreign patent he says the fat must be immersed in the gastric juice; but the proof shows that the formula for the gastric juice in the American patent gives a more potent and effective product; and we presume | Mége may, by his experience and practice under his patents, have ascertained, at the time he took the American patent, that the process of digestion could be accomplished with a less quantity of gastric juice than was described in his first patents. But this is only a difference in degree; and with a larger quantity of gastric juice, and not so complete comminution, about the same result would probably be obtained as with complete and thorough crushing of all the fat cells, and a smaller quantity of gastric juice, especially if made stronger or more potent. So that the difference in the American and foreign patents in that regard seems to us wholly immaterial and unsubstantial. As to the claim that these witnesses find in the American patent permission to raise the temperature above 103 deg. Fahrenheit, we do not think it is well founded, when the whole of Mége's specifi

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cations in his American patent are consid. ered. Under the third head, 'Concentrated Digestion,' Mége says: When the fat has descended in the vessel, he melted it by means of artificial digestion, so that the heat does not exceed 103 deg. Fahrenheit.' Further on, in the same paragraph, he says: Heslowly raised the temperature to about 103 deg. Fahrenheit, so that the matter shall completely separate.' Taking these two expressions together, it seems to us the first limits the second, and that the directions of the patent are specific not to raise the temperature above 103 deg. Fahrenheit. Certainly the language, I slowly raise the temperature to about 1032 deg.,' does not authorize raising the temperature above that point. When the distinction immediately before us is that it must not exceed 103 deg. Fahrenheit, and when we consider this language of the specifications in the light of the testimony in the case, which shows that gastric juice is destroyed whenever its temperature is raised much above 103 deg. Fahrenheit, we think there can be no doubt that the eminent scientist who devised this process intended to keep within the limits in which his gastric juice would be operative for the purposes of digestion. The last and final distinction, that the foreign patents contemplated a cooling of the mass below 86 deg., or until it had become stiff, so that it could be handled and cut, before the pressure was applied for the purpose of separating the oleomargarine from the stearine, is a distinction, as it seems to us, without a difference. If the stearine had become crystallized in the mass, although it might at one time have been cooled below 86 deg., when it was sliced, and placed between the warm plates in the press, the oleomargarine would again become liquid, and flow out under the action of the warm plates and the press, so as to secure the separation; and that such was the result is sufficiently established by the statements in the foreign patents, notably the Austrian and English, that about 60 per cent. of a mixture of the margarine and olein, of a composition identical with lard, but of superior flavor, was obtained by the pressure, would seem to show, in the light of the proof in this case, that he obtained as large a product as is obtained by the process of the American patent. A fair test of the question as to whether the American patent is anticipated by the foreign patents, or is included in them, we think would be: Were a person in this country, after the issue of the present American patent, to commence the manufacture of oleomargarine by the precise process described in the Bavarian or Austrian patents, supposing that process had not been patented abroad, would the courts refuse an injunction to restrain the use of the process on the ground that it infringed that covered by the American patent? We can hardly deem it possible that any intelligent court would deny an injunction if applied for under such circumstances; *and we think this fairly illustrates the relation of the foreign to the American patent. The conclusion of the circuit court was that the plaintiff's patent expired by the expiration of the Bavarian and Austrian patents.

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We have carefully considered the arguments urged in the briefs of the counsel for the plaintiffs, in connection with the testimony of their experts, and are of opinion that the views of the circuit court, above quoted, are correct. Its decree is affirmed. (135 U. S. 161)

LYNG V. STATE OF MICHIGAN.1

(April 28, 1890.)

INTOXICATING LIQUORS-CONSTITUTIONAL INTERSTATE COMMERCE.

said, and from there shipped to their said warehouse in said village of Iron River, tc be there stored and disposed of. (4) The defendant, Henry Lyng, is employed by said Hagemeister & Son as their agent, on a regular salary, to look after their said warehouse, to take orders for and deliver said beer, so manufactured and stored, in quantities exceeding three gallons, and to collect and remit the proceeds of the sales LAW-thereof to Hagemeister & Son, and was so employed on the 19th day of July, 1888. (5) On July 19, 1888, at the village of Iron River, in the county of Iron and state of Michigan, said defendant, in the course of said employment by Hagemeister & Son, did deliver from said warehouse to Martin Lally, and to divers other persons, all of whom paid him therefor, certain of said lager-beer so made and shipped by Hagemeister & Son from Green Bay aforesaid, in quantities exceeding three gallons. All of said lager-beer was so delivered in the original packages in which it had been shipped. The defendant sold no other liquors. (6) Neither the said defendant nor the said Hagemeister & Son, or either of them, have paid any tax in the village of Iron River, aforesaid, on the business of selling or keeping for sale malt liquors at wholesale or at wholesale and retail, nor given any bond such as is mentioned in Act No. 313 of the Public Acts of Michigan for 1887."

Pub. Acts Mich. 1887, No. 313, imposing an annual tax of $300 on the business of selling only brewed or malt liquors at wholesale or retail, and a tax of $65 on the business of manufacturing such liquors, and providing that a manufacturer may sell without paying anything but the manufacturers' license, is a regulation of interstate commerce in so far as it prevents a non-resident manufacturer from sending such liquor into the state, and there disposing of it, in the original packages, through a clerk located there. Following Leisy v. Hardin, ante, 681.

HARLAN, GRAY, and BREWER, JJ., dissenting.

In error to the supreme court of the state of Michigan.

Plaintiff in error was prosecuted and convicted in the circuit court for Iron county, Mich., under an information alleging "that on the 19th day of July, in the year of our Lord one thousand eight hundred and eighty-eight, at the village of Iron River, in said Iron county, Henry Lyng, then and there being, was a person whose business consisted in part of selling at wholesale brewed and malt liquors, not proprietary patent medicine, as agent for Franz Hagemeister and Henry Hagemeister, copartners doing business in the city of Green Bay, Wisconsin, under the firm name of Hagemeister & Son, without he or they having paid in full or in part the tax required by law to be paid upon the business; neither he nor they being druggists selling liquors for chemical, medicinal, or sacramental purposes only, and in strict compliance with the law. The case went to the supreme court of Michigan on exceptions, and the conviction was affirmed, and the case remanded to the circuit court with instructions to proceed to judgment. This was done accordingly; and, the supreme court having affirmed the judgment, the cause was thereupon brought to this court by writ of error. The opinion of the supreme court is to be found in 42 N. W. Rep. 139.

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The trial in the circuit court was had upon the following facts agreed: “(1) Franz Hagemeister and Henry Hagemeister are citizens of the United States of America, and reside at the city of Green Bay, in the state of Wisconsin, and are engaged in the manufacture of lager-beer under the name of Hagemeister & Son, at Green Bay aforesaid, where they have a brewery for the manufacture thereof. (2) Such lager-beer is brewed liquor, within the meaning of Act No. 313 of the Laws of Michigan for 1887. (3) Said Hagemeister & Son own a warehouse in the village of Iron River, in the township of Iron, in the county of Iron and state of Michigan, where they store quantities of their lagerbeer so made by them at Green Bay afore'Reversing 42 N. W. Rep. 139.

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Sections 1, 2, 4, 7, and 24 of Act No. 313 of Pub. Acts Mich. 1887, p. 415 et seq., are as follows: "Section 1. The people of the state of Michigan enact that in all townships, cities, and villages of this state, there shall be paid annually the following tax upon the business of maufacturing, selling, or keeping for sale, by all persons whose business, in whole or in part, consists in selling or keeping for sale, or manufacturing, distilled or brewed or malt liquors or mixed liquors, as follows: Upon the business of selling or offering for sale spirituous or intoxicating liquors, or mixed liquors, by retail, or any mixture or compound, excepting proprietary patent medicines, which in whole or in part consist of spirituous or intoxicating liquors, and any malt, brewed, or fermented liquors, five hundred dollars per annum; upon the business of selling only brewed or malt liquors at wholesale or retail, or at wholesale and retail, three hundred dollars per annum; upon the business of selling spirituous or intoxicating liquors at wholesale, five hundred dollars, or at wholesale and retail, eight hundred dollars, per annum; upon the business of manufacturing brewed or malt liquors for sale, sixty-five dollars per annum; upon the business of manufacturing for sale spirituous or intoxicating liquors, eight hundred dollars per annum. No person paying a tax on spirituous or intoxicating liquors under this act shall be liable to pay any tax on the sale of malt, brewed, or fermented liquors. No person paying a manufacturer's tax on brewed or malt liquors under this act shall be liable to pay a wholesale dealer's tax on the same. Sec. 2. Retail dealers of spirituous or intoxicating lquors, and brewed, malt, and fermented liquors, shall be held and deemed to include all persons who sell any of such liquors by the drink, and in

162

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quantities of three gallons or less, or one dozen quart bottles or less, at any one time, to any person or persons. Wholesale dealers shall be held and deemed to mean and include all persons who sell, or offer for sale, such liquors and beverages in quantities of more than three gallons, or more than one dozen quart bottles, at any one time, to any person or persons. No tax imposed under this act shall be required from any person for selling any wine or cider made from fruits grown or gathered in this state, unless such wine or cider be sold by the drink as other beverages are. Sec. 4. Every person engaged in, or intending to engage in, any business named in section one of this act, and requiring the payment of any tax mentioned in said section one, shall, on or before the first day of May in each year, make and file with the county treasurer in the county where it is proposed to carry on such business, a statement, in writing and on oath, showing the name and residence of such person, the ward, village, or township in which it is proposed to carry on such sale or manufacture, and the nature of the business which such person is engaged in, or is intending to engage in, and shall, on or before the first day of May in each year, pay to the said county treasurer, in advance, the taxes required by said section one for such business for the year commencing on said first day of May, and ending on the thirtieth day of April next thereafter." "Sec. 7. If any person or persons shall engage or be engaged in any business requiring the payment of a tax under section one of this act without having paid in full the tax required by this act, and without having the receipt and notice for such tax posted up as required by this act, or without having made, executed, and delivered the bond required by this act, or shall in any manner violate any of the provisions of this act, such person or persons shall be deemed guilty of a misdemeanor, and, upon conviction thereof, if there is no specific penalty provided therefor by this act, shall be punished by a fine of not more than two hundred dollars and costs of prosecution, or by imprisonment in the county jail not less than ten days nor more than ninety days, or both such fine and imprisonment, in the discretion of the court. And, in case such fine and costs shall not have been paid at the time such imprisoment expires, the person serving out such sentence shall be further detained in jail until such fine and costs shall have been fully paid: provided, that in no case shall the whole term of imprisonment exceed six months. And any person or persons engaged in any business requiring the payment of a tax under section one of this act who, after paying the tax so required, shall be convicted of the violation of any of the provisions of this act, shall thereby, in addition to all other penalties prescribed by this act, forfeit the tax so paid by him or them, and be precluded from continuing such business for the remainder of the year or time for which said tax was paid, and be debarred from again engaging in any business requiring the payment of a tax under section one of this act, or from becoming a surety or sureties upon

any bond required under section seven of this act, for the period of one year from the time of such conviction. Each violation of any of the provisions of this act shall be construed to constitute a separate and complete offense, and for each violation on the same day, or on different days, the person or persons offending shall be liable to the penalties and forfeitures herein provided, and be precluded and debarred from continuing or engaging in any business requiring the payment of a tax under this act as aforesaid. And it shall be the duty of sheriffs, marshals,constables, and police officers to forth with close all saloons and other places where the business of manufacturing, selling, or keeping for sale any of the liquors mentioned in section one of this act is being conducted, upon which business the tax required by said section one has not been paid in full, and in which the receipt mentioned in section five of this act shall not be posted up and displayed." "Sec. 24. All persons engaged in the business of selling or keeping for sale any of the liquors mentioned in this act, whether as owner, or as clerk, agent, or servant, or employe, shall be equally liable as principals for any violation of any of the provisions of this act; and any person or principal shall be liable for the acts of his clerk, servant, agent, or employe, for any violation of the provisions of this act."

Howard E. Thompson, for plaintiff in Edward Cahill, for defendant in

error.

error.

Mr. Chief Justice FULLER, after stating the facts as above, delivered the opinion of the court:

Under the statute in question, which is entitled, “An act to provide for the taxation and regulation of the business of manufacturing, selling, keeping for sale, furnishing, giving, or delivering spirituous or intoxicating liquors, and malt, brewed, *or fermented liquors, or vinous liquors, inc this state, and to repeal all acts or parts of acts inconsistent with the provisions of this act," an annual tax is levied "upon the business of selling only brewed or malt liquors at wholesale or retail, or at wholesale and retail," of three hundred dollars, and "upon the business of manufacturing brewed or malt liquors for sale, sixty-five dollars per annum. The manufacturer of malt or brewed liquors made outside of the state of Michigan cannot introduce them into the hands of consumers or retail dealers in that state without becoming subject to this wholesale dealer's tax of $300 per annum in every township, village, or city where he attempts to do this. The manufacturer in the state need only pay the manufacturer's tax of $65, and is then exempt from paying the tax imposed on the wholesale dealer.

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We have repeatedly held that no state has the right to lay a tax on interstate commerce in any form, whether by way of duties laid on the transportation of the subjects of that commerce, or on the receipts derived from that transportation, or on the occupation or business of carrying it on, for the reason that such taxation is a burden on that commerce, and amounts to

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a regulation of it, which belongs solely to congress. Leloup v. Mobile, 127 U. S. 640, 648, 8 Sup. Ct. Rep. 1380, and cases cited. In Bowman v. Railway Co., 125 U. S. 465, 8 Sup. Ct. Rep. 689, 1062, it was decided that a section of the Code of the state of Iowa forbidding common carriers to bring intoxicating liquors into the state from any other state or territory, without first being furnished with a certificate as prescribed, was essentially a regulation of commerce among the states, and, not being sanctioned by the authority, express or implied, of congress, was invalid, because repugnant to the constitution of the United States; and in Leisy v. Hardin, ante, 681, the judgment in which has just been announced, that the right of importation of ardent spirits, distilled liquors, ale, and beer from one state into another, includes, by necessary implication, the right of sale in the original packages at the place where the importation terminates, and that the power cannot be conceded to a state to exclude, directly or indirectly, the subjects of*interstate commerce, or, by the imposition of burdens thereon, to regulate such commerce, without congressional permission. The same rule that applies to the sugar of Louisiana, the cotton of South Carolina, the wines of California, the hops of Washington, the tobacco of Maryland and Connecticut, or the products, natural or manufactured, of any state, applies to all commodities in which a right of traffic exists, recognized by the laws of congress, the decisions of courts, and the usages of the commercial world. It devolves on congress to indicate such exceptions as, in its judgment, a wise discretion may demand under particular circumstances. Lyng was merely the representative of the importers, and his conviction cannot be sustained, in view of the conclusions at which we have arrived. The judgment of the supreme court of the state of Michigan is reversed, and the cause remanded for further proceedings not inconsistent with this opinion.

HARLAN, GRAY, and BREWER, JJ., dissented upon the grounds stated in their opinion in Leisy v. Hardin, ante, 681.

(134 U. S. 401)

GEORGE H. HAMMOND & Co. v. HASTINGS.

(March 24, 1890.) CORPORATIONS-LIEN ON STOCK-INNOCENT PURCHASERS.

How. St. Mich. § 4143, providing that a corporation shall have a lien on all the stock or property of its members invested therein, for all debts due from them to the corporation, is a general law. with knowledge of whose provisions all are chargeable; and hence one who purchases stock of a Michigan corporation, organized under that law, belonging to one who is indebted to such corporation, takes it subject to the lien, though he may be a resident of another state, and ignorant of the indebtedness.

In error to the circuit court of the United States for the northern district of Illinois.

Don M. Dickinson and A. H. Garland, for plaintiff in error. Thomas McDougall, for defendant in error.

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the within stock, and do hereby constitute and appoint attorney to transfer the same on the books of the company. "Witness my hand and seal this day of A. D. 18-.

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On

[L. 8.]" These certificates had theretofore been pledged to the National Bank of Illinois, a bank located in the city of Chicago. that day, in pursuance of the pledge, the stock was sold and purchased by the defendant in error, Thomas D. Hastings. During all the time that Sweet owned the stock he was indebted to the corporation George H. Hammond & Co. After his purchase Mr. Hastings presented the certificates to the officers of the corporation and demanded a transfer. This was refused, on the ground that the corporation had a lien upon the stock for the amount of Sweet's indebtedness to it. Thereupon this action was brought.

⚫402

George H. Hammond & Co. was a manufacturing corporation created in October, 1881, under the laws of the state of Michigan, with its principal office in the city of Detroit, Mich.; and Sweet was, during thes time of these transactions, a resident of and doing business in the city of Chicago, selling the property of the corporation on commission. The law of Michigan under which manufacturing companies may be organized, and under which George H. Hammond & Co. was created and exists, has, since 1875, contained this provision, (section 4143, 1 How. Ann. St; section 17, Act 187, Laws 1875:) "The stock of every such corporation shall be deemed personal property, and be transferred only on the books of such corporation, in such form and manner as their by-laws shall prescribe; and such corporation shall at all times have a lien upon all the stock or property of its members invested therein, for all debts due from them to such corporation." The general act (1 How. St. § 4866) provides, as to all corporations, that a transfer of stock shall not be valid except as between the parties, unless entered on the books of the company, showing the names of the parties, by and to whom

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transferred, the number and designation of shares, and the date of the transfer. The bank was ignorant of Sweet's indebtedness to the corporation when it lent its money on the security of the stock, and of course Hastings, though notified thereof at the time of the sale, succeeded to all the rights of the bank. On these facts the circuit judge held that the purchaser took the stock discharged of any lien, and submitted to the jury only the question of the value of the stock. This having been found by its verdict, judgment was entered therefor, and the corporation now alleges error. The single question is whether the corporation had a lien upon the stock for Sweet's indebtedness, as against the claims of the bank and the purchaser. This question must be answered in the affirmative; for the rule is clear and unquestioned that where by general law a lien is given to a corporation upon its stock for the indebtedness of the stockholder, it is valid and enforceable against all the world. Bank v. Laird, 2 Wheat. 390; Brent v. Bank, 10 Pet. 596; Bank v. Bank, 105 U. S. 217, 221; Rogers v. Bank, 12 Serg. & R. 77; Sewall v. Bank, 17 Serg. & R. 284; Presbyterian Congregation v. Bank, 5 Pa. St. 345, 348; Bank v. Iglehart, 6 Gill, 50; Reese v. Bank, 14 Md. 271; First Nat. Bank of Hartford v. Hartford L. & A. Ins. Co., 45 Conn. 22; Bishop v. Globe Co., 135 Mass. 132; Bohmer v. Bank, 77 Va. 445.

This

The law under which this corporation was organized was a general law. So it has been decided by the supreme court of Michigan, (Newberry v. Manufacturing Co., 17 Mich. 141, 151,) where it is said: "The law in question is a public act, and all are charged with knowledge of its provisions." construction by the supreme court of the state which enacted the law is conclusive in this court, as well as everywhere, as to its character. The law in terms provides for a lien, and that being a public law all are charged with knowledge of its provisions. Generally, wherever paper of anature similar to this is issued, under authority granted by general statute, whoever deals with that paper is charged with notice of all limitations and burdens attached to it by such statute. And this is true whether the party lives in or out of the state by which the law was enacted. See authorities cited, supra. It was unnecessary to enter upon the certificate any statement of the limitations and burdens which the law casts upon all such paper, and the omission to state such limitations upon the face of the paper is not a waiver by the corporation of the benefits thereof. In the case in 2 Wheat., supra, where the act of incorporation gave a lien, this court, by Mr. Justice STORY, said: "The certificate, issued to Patton for the fifty shares held by him, (which is in the usual form,) declares the shares to be 'transferable at the said bank, by the said Patton, or his attorney, on surrendering this certificate.' No person, therefore, can acquire a legal title to any shares, except under a regular transfer, according to the rules of the bank; and if any person takes an equitable assignment it must be subject to the rights of the bank, under the act of incorporation, of which he is bound to take notice.'

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Repeated efforts have been made to have certificates of stock declared negotiable paper, but they have been unsuccessful. Such a certificate is not negotiable in either form or*character, and, like every non-negotiable paper, whoever takes it does so subject to its equities and burdens; and, though ignorant of such equities and burdens, his ignorance does not relieve the paper therefrom, or enable him to hold it discharged therefrom. It is objected that upon the face of this certificate it is nowhere stated that "George H. Hammond & Company" is a corporation. While this is not expressly stated, it clearly appears; and, even if it were not so, the certificate is non-negotiable paper, and the party had no right to deal with it as though it were otherwise. He takes it subject to the burdens that in fact rested upon it. Technical matters are suggested by counsel, but we deem it unneccessary to notice them. The circuit judge unquestionably, as appears from the record, ruled upon the substantial question considered by us. We think his ruling erroneous, and the case must therefore be reversed. That this lien of a corporation may be waived cannot be doubted. Bank v. Bank, 105 U. S. 217, 221. Perhaps when all the facts are developed, as they can be on the new trial, matters may be disclosed sufficient to establish a waiver; but mere ignorance on the part of the purchaser of the fact of the existence of the lien does not destroy it. It constitutes no waiver on the part of the corporation. Judgment reversed, and the case remanded for a new trial.

(135 U. S. 195)

VICKSBURG, S. & P. R. Co. v. SMITH et al. (April 21, 1890.)

APPEAL JURISDICTIONAL AMOUNT. The petition alleged that plaintiffs were the owners of land, (which was admitted on the trial to be worth $10,000,) that defendant T. was in possession of a part of it, (which was worth $2,000,) and prayed for a recovery of the land in his possession. T. claiming to hold only as tenant of V., the latter was, by order of court, made defendant in his place; and answered, denying the allegations of the petition, and alleging ownership of the entire tract. Plaintiffs obtained judgment for the land in the possession of T. Held, that the amount involved did not exceed $5,000, and the supreme court had no jurisdiction.

In error to the circuit court of the United States for the western district of Louisiana.

Edward Colston, Geo. Hoadly, and E. M. Johnson, for plaintiff in error. A. H. Leonard, A. J. Falls, and S. F. Phillips, for defendants in error.

BLATCHFORD, J. This is an action at law, brought in the circuit court of the United States for the western district of Louisiana, by Robert N. Smith, Elizabeth* A. Smith, (wife of Marine Duvall, joined, authorized, and assisted by her husband,) William L. Smith, Elizabeth W. Smith, (widow of James F. Smith,) citizens of Kentucky, and John S. Smith, a citizen of Colorado, as legal heirs of William_W. Smith, deceased, against George A. Turner, a citizen of Louisiana. The petition avers that the state of Louisiana, on the 14th of May, 1853, sold to William W. Smith

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