# Hunt v. New York Cotton Exchange/Opinion of the Court

* Court Documents
* Case Syllabus
* Opinion of the Court
United States Supreme Court
205 U.S. 322
Hunt v. New York Cotton Exchange
Argued: March 4, 1907. --- Decided: April 8, 1907
It will be observed that this case is like the Board of Trade v. Christie Grain & Stock Co. 198 U.S. 236, 46 L. ed. 1031, 25 Sup. Ct. Rep. 637, and we therefore start with some propositions established. It is established that the quotations are property and are entitled to the protection of the law, and that the exchange 'has the right to keep the work which it has done, or paid for doing, to itself.' It is, however, contended by appellant that the controversy about them that this suit presents does not involve the value of $2,000, exclusive of interest and costs. This is the issue presented by the plea to the jurisdiction. Appellant contends that the value involved is measured by his contract with the telegraph company. The exchange contends that the matter in dispute is the value of the object sought to be accomplished by the bill. The circuit court expressed it to be 'the value of the contract between the New York Cotton Exchange and the Western Union Telegraph Company.'
On the issue presented by the plea the burden of proof was upon the appellant, and he was required to establish by a preponderance of the evidence that the amount involved was less than the jurisdictional amount. Sheppard v. Graves, 14 How, 505, 14 L. ed. 518; Wetmore v. Rymer, 169 U.S. 115, 42 L. ed. 682, 18 Sup. Ct. Rep. 293; Gage v. Pumpelly, 108 U.S. 164, 27 L. ed. 668, 2 Sup. Ct. Rep. 390; Adams v. Shirk, 55 C. C. A. 25, 117 Fed. 801. The only evidence offered by him was his contract with the telegraph company in connection with evidence of the manner of his receipt and use of the quotations. This testimony was to the effect that the quotations are communicated through a ticker, which is a machine with a tape attached to it, that registers the price of cotton, giving the hour. They come sometimes not more than a quarter of a minute or a half of a minute apart, and are copied from the tape and placed upon a blackboard, where all can see them. When new quotations are received the old ones are generally wiped out. The 'ticker service is very slow, and the value of it depends on the time it is received. After it is put upon the blackboard it becomes public property, so far as concerns the value of it.' And it was testified that a firm by the name of Ganong & Fitzgerald received their quotations about five minutes before appellant, they having better wire service. And also that there was a wire running into the Memphis Cotton Exchange, and that not quite a minute elapsed from the time the ticker registers the market quotations to the time they are registered on the blackboard in the city of Memphis and open to the public. Appellant testified that the amount of his business in cotton for future delivery amounted to one half million dollars per year, and when he took a trade himself he was prepared to deliver the cotton or commodity in conformity with the agreement between himself and his customer, and goes so far as to write across all orders that actual delivery is contemplated and understood.
A witness on the part of the exchange testified that he was employed by the board of trade as expert to investigate persons who pretended to be brokers, 'but who were in fact bucket shops,' and was in that position for several years, gathered statistics, made estimates of the volume of business during 1901 and 1902, and has kept pretty well informed ever since as to the number of bucket shops in the United States. And he further testified that trades are carried on in such shops in all commodities that are traded in on the New York Cotton Exchange, New York Stock Exchange, and the Chicago Board of Trade. Of the value of the right of the New York Cotton Exchange to control the distribution of its quotation he said: 'One can only estimate or approximate the value of the right, for the reason that the volume of speculative business in the country changes, and that changes the value of the right. If there is a large volume of speculative business in cotton the value to the New York Cotton Exchange would probably amount to a million dollars, while with a depressed market it would not amount to more than $200,000 or $300,000.' And this is the amount per year.
A superintendent of the exchange testified to his familiarity in a general way with what is called the independent trader, or independent trade, as distinguished from the trade or traders who carry their transactions to the cotton exchanges of the country, and in a measure with the volume of business done by such persons in an approximate way.
He further testified that the amount of business thus diverted from the exchange made a difference to the exchange of fully $1,000,000 a year, and that the value of the right to control the distribution of the quotations in the manner set out in the bill would very much exceed $2,000.
The witness was unable to state the relative amount of business done on the exchange in the years 1903, 1904, and 1905, because there was no record of the transactions kept, but he reached the conclusion in regard to the value of the business diverted from the exchange partly from the evidence given by appellee and partly as to the business done by the bucket shops. And he put the value 'in dollars and cents,' of the contract between the exchange and the telegraph company, independent of the amount of business diverted, at the amount the exchange received from the telegraph company. The following colloquy took place between the witness and counsel for appellant:
Q. Now, Mr. King, what time, up to this good moment and hour, has that exchange failed to receive the amount of that contract, that is, for giving the Western Union Telegraph Company the right to furnish this information gathered on the floor of the New York Cotton Exchange?
A. It has not.
Q. Then, in short, this here is nothing except fear and apprehension that unless these defendants are restrained that is likely to happen, and affect the value of the contract? A. And the business upon the exchange.
It is manifest that the injury to the exchange is not the rate paid by the appellant to the telegraph company. The purpose of the suit is to enjoin the appellant from receiving, using, or selling, directly or indirectly, the exchange's quotations, or permitting or maintaining any wire to his office over which the quotations are passing, or distributing the quotations, until he shall have acquired the right to receive them, either by contract of purchase from the exchange, or, with its consent and approval, from one of the telegraph companies authorized to distribute them. In other words, the object of the suit is to keep the control of the quotations by the exchange and its protection from the competition of bucket shops or the identity of its business with that of bucket shops. And the right to the quotations was declared, as we said in Board of Trade v. Christie Grain & Stock Co., to be property, and the exchange may keep them to itself or communicate them to others. The object of this suit is to protect that right. The right, therefore, is the matter in dispute, and its value to the exchange determines the jurisdiction, not the rate paid by appellant to the telegraph company. The value of the right was testified to be much greater than $2,000. In Mississippi & M. R. Co. v. Ward, 2 Black, 485, 17 L. ed. 311, it was decided that jurisdiction is tested by the value of the object to be gained by the bill. To the same effect is Board of Trade v. Cella Commission Co. 145 Fed. 28. In the latter suit the Chicago Board of Trade obtained a decree restraining the use of its continuous quotations by the Cella Commission Company. It was said that the amount or value of such right is not the sum a complainant might recover in an action at law for the damage already sustained, nor is he required to wait until it reaches the jurisdictional amount. The latter declaration is supported by Scott v. Donald, 165 U.S. 107, 41 L. ed. 648, 17 Sup. Ct. Rep. 262.
Counsel for appellant do not deny that jurisdiction is determinable by the object sought to be accomplished by the bill, but they assert that the value of that was speculative, and changed with the volume of business. Counsel lay great stress on the testimony of the superintendent of the exchange, to the effect that the value of the contract between the exchange and the telegraph company, independent of the business diverted from the exchange, is, in dollars and cents, the amount it receives from the telegraph company. Upon this testimony counsel assert the right claimed by the exchange to be the narrow one of preventing the appellant from receiving the continuous quotations from the telegraph company, which he pays for, pending a litigation in the state courts, and this distinguishes the case from the Board of Trade v. Christie Grain & Stock Co. and contend that the jurisdictional amount has not been established, as the telegraph company is fulfilling its contract with the exchange. Of the latter contention we have sufficiently indicated our view, and it is only necessary to add that because the value of the quotations to the exchange varies with the volume of business does not impair the effect of the testimony that the value of its right to control them is 'much greater than $2,000.' We cannot concur in the conclusion urged by appellant, that this case is distinguishable in principle from Board of Trade v. Christie Grain & Stock Co., either in the right asserted or in the defense against it. Even if the cases were distinguishable, it might still be contended, that would be of no consequence in determining the jurisdictional amount of the matter in dispute. But we will consider the difference claimed to exist between the cases. In the Christie Case, it is contended, the right asserted was 'to prevent getting at the knowledge of a trade secret or the quotations of the market surreptitiously, and using the knowledge so obtained,' and that, it is insisted, was the matter in controversy. 'Here,' it is said, 'there is no violation of a duty or trust. The market quotations are not received surreptitiously. The appellant is not depriving the appellee of the protection of the law.' In the Christie Case the quotations were gotten and published, 'in some way not disclosed,' but, it was said, as the defendants did not get them from the telegraph companies authorized to distribute them, had declined to sign contracts satisfactory to the plaintiff (board of trade), and denied the plaintiff's rights altogether, it was a reasonable conclusion that they got, and intended to get, their knowledge in a way which was wrongful. This, however, was not said to limit plaintiff's right, but to express a violation of it. The right was clearly defined to be, the right of the board of trade to keep the quotations to itself or communicate them to others. And this is also the right of the exchange in the case at bar. It can be violated not only by getting the quotations surreptitiously or 'in some way not disclosed,' or by getting them from a person forbidden to communicate them.
The next contention of appellant is that the court had no jurisdiction to grant the injunction and pronounce the decree appealed from. The only question involved in this branch of the case, appellant says, is 'whether it comes within the provision of the Revised Statutes, § 720, U.S.C.omp. Stat. 1901, p. 581, which is to the effect that no writ of injunction shall be granted by a court of the United States to stay proceedings of any court except in matters of bankruptcy.'
And appellant insists that this suit necessarily offends that section, because under its decree he 'cannot have the benefit of the judgment of the state court without being in contempt of the Federal court,' and that he is restrained by the circuit court from receiving from the telegraph company what the company is forbidden to refuse him by the state court. To sustain his contention appellant cites United States v. Parkhurst Davis Mercantile Co. 176 U.S. 317, 44 L. ed. 485, 20 Sup. Ct. Rep. 423, and cases there referred to. Also Diggs v. Wolcott, 4 Cranch, 179, 2 L. ed. 587; Watson v. Jones, 13 Wall. 679, 20 L. ed. 666; Dial v. Reynolds, 96 U.S. 340, 24 L. ed. 644; Central Nat. Bank v. Stevens, 169 U.S. 433, 42 L. ed. 807, 18 Sup. Ct. Rep. 403. These cases do not sustain his contention. In Central Nat. Bank v. Stevens it was decided that a state court had no power to enjoin a party whose rights had been adjudged by a circuit court of the United States from proceeding with a sale of property under a decree of that court. In the other cases cited, except Watson v. Jones, the purpose was to directly enjoin parties from proceeding in the state courts. In Watson v. Jones was considered what identity of parties, rights, and relief prayed for was necessary to enable the pendency of an action in one court to be pleaded in bar in another court, and it was said: 'The identity in these particulars should be such that, if the pending case had already been disposed of, it could be pleaded in bar as a former adjudication of the same matter between the same parties.' The principle was also expressed in that case, and sustained by authorities, that the possession of property by one court cannot be interfered with by another, and, that the act of Congress of March 2, 1793 (1 Stat. at L. 334, chap. 22, § 5), (now § 720 of the Revised Statutes of the United States [U.S.C.omp. Stat. 1901, p. 581]), as construed in Diggs v. Wolcott, supra, and Peck v. Jenness, 7 How. 625, 12 L. ed. 846, is equally conclusive against any injunctions from the circuit court, forbidding the defendants in the case to take possession of property which an unexecuted decree of a state court required the marshal to deliver to them. The case at bar has not that feature, nor has it identity with the case in the chancery court of Shelby county. Its parties and purposes are different. The pendency of a suit in a state court does not deprive a Federal court of jurisdiction. Gordon v. Gilfoil, 99 U.S. 168, 25 L. ed. 383; Mutual L. Ins. Co. v. Brune, 96 U.S. 588, 24 L. ed. 737; Stanton v. Embrey, 93 U.S. 548, 23 L. ed. 983; Merritt v. American Steel-Barge Co. 24 C. C. A. 530, 49 U.S. App. 85, 79 Fed. 228; Bank of Kentucky v. Stone, 88 Fed. 383.
The Circuit Court had jurisdiction, and its decree is affirmed.

## Notes

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