American Chemical Paint Co. v. Commissioner of Int. Rev.

BUFFINGTON, Circuit Judge.

The just determination of this tax ease depends on the value of a novel, useful, and inventive disclosure made by Feidt, to whom patent No. 1,119,781 issued therefor. This patent is, by mesne assignments, owned by the American Chemical Paint Company, the taxpayer, and for which it paid all of its common stock of $450,000, and $5,000 of its $7,-500 preferred stock. In the taxable year of 1927 the company made a profit in the working of such patent and royalties thereon of $628,113.53. Its contention herein is that it should be allowed for the yearly exhaustion of the…