BARR, District Judge.
The demurrer to the bill raises: (1) The question of the jurisdiction of this court. (2) Whether or not the tax, as alleged in the bill, is upon interstate commerce, and within the inhibition of the federal constitution. (3) Is this tax, as provided by the Kentucky legislature, a violation of the constitution of Kentucky?
The jurisdiction of the court is claimed because of the diverse citizenship of the parties, and because the tax is alleged to be in violation of the federal constitution. The diverse citizenship is aptly alleged, and the amount of the tax in controversy which is sought to be enjoined, so far as it may have beeh for the benefit of the state, is more than $2,000, exclusive of interest and costs, and that appears upon the face of the bill. The bill, in addition to seeking to enjoin the collection of the taxes levied for the benefit of the state of Kentucky, seeks to enjoin the auditor, Norman, from certifying to the different county clerks, 68 in number, their respective proportions of the taxes assessed b.y the'board of valuation and assessment, and alleges that these local taxes, with the tax for the benefit of the state of Kentucky, will amount to about $10,000. The aggregate, of these local taxes is thus shown to be over $2,000, exclusive of interest and costs. The case, we think, is not within the principle of Fishback v. Telegraph Co. (decided by the supreme court March 2, 1896) 16 (Sup. Ct. 506, and the previous case of Walter v. Railroad Co., 147 U. S. 370, 13 Sup. Ct. 348. In both of these cases it was sought to enjoin the collection of local taxes which had been assessed and levied by the respective counties and municipalities. Hence the local taxes had been distinctly separated, so that a separate action could have been maintained against the counties and municipalities, if the taxes had been paid under protest. Here it is sought to prevent the auditor from completing the appraisement and levy of taxes, which, if completed without legal authority, would be a wrongful act, and one probably subjecting him to an action by the party injured thereby. However this may be, the amount of tax in controversy between the plaintiff and the defendant, for the benefit of the state of Kentucky, is over $2,000, exclusive of interest and [21]*21costs. The jurisdiction of the circuit court seems, therefore, to be clear, from the face of the bill.
The bill alleges, as ground for the equitable jurisdiction and the granting of an injunction, the complainant’s liability to a multiplicity of suits if the assessment and levy is completed, and an irreparable injury which will he caused by the enforcement of the penalties of the law for the nonpayment of these illegal taxes. It is the uniform practice in this state to allow an injunction to restrain either the assessment or collection of illegal taxes, and the equity jurisdiction in such cases has been frequently sustained by the court of appeals. See Louisville & N. R. Co. v. Warren County Ct., 5 Bush, 245; Gates v. Barrett, 79 Ky. 295; Water Co. v. Clark, 94 Ky. 47, 21 S. W. 246. But, independently of this uniform practice in this state, which sustains the exercise of equitable jurisdiction of injunction in such cases, the allegations of this bill, as to the multiplicity of suits, and the irreparable injury which the assessment and collection of these taxes will cause the complainant, are, we think, sufficient to sustain the equitable jurisdiction upon general principles. Telegraph Co. v. Poe, 61 Fed. 469; Sanford v. Poe, 16 C. C. A. 305, 69 Fed. 546. These cases are distinctly in point, as there the equitable jurisdiction was sustained because of the multiplicity of suits which w’ould follow from the completion of an assessment, and the levy of the local taxi's, which local taxes, separated, would have been less than the ?2,000 limit.
The complainant is not seeking relief because the valuation and assessments of the hoard are excessive, but that the entire valuation and assessment is illegal and void. It may be assumed as settled that the state of Kentucky has authority to levy and collect a tax on all of the property of the complainant, tangible as well as intangible, if within the taxing power of the state. This right, however, is subject to certain constitutional limitations. Hence, the state cannot tax foreign or interstate commerce as such, nor can it tax its agencies or instrumentalities in such a manner as to interfere with the regulation of this commerce, which belongs exclusively to congress. The state may tax property within the state, though it be employed in whole or in part in foreign or domestic commerce, as that use does not, of itself, exempt it from liability to taxation as is all other property within the jurisdiction of the state. Delaware Railroad Tax Cases, 18 Wall. 232; W. U. Tel. Co. v. Attorney General of Massachusetts, 125 U. S. 530, 8 Sup. Ct. 961; Leloup v. Port of Mobile, 127 U. S. 640, 8 Sup. Ct. 1380; Pullman’s Palace-Car Co., v. Pennsylvania, 141 U. S. 18, 11 Sup. Ct. 876; Cable Co. v. Adams, 155 U. S. 688, 15 Sup. Ct. 268, 360. The present inquiry is, therefore, as to the kind of tax which is sought to be imposed, and the location of the property sought to he taxed.
There is much difficulty in'construing the various provisions of the Kentucky Statutes heretofore quoted. It will he seen that the language of section 4077 is that certain corporations and companies “shall, in addition to the other taxes imposed by law, annually pay a tax on its franchise to the state and a local tax thereon to the county, incorporated city, town, and taxing district where its Iran-' [22]*22chi se may be exercised.” A “franchise,” in its legal sense, is defined by Chief Justice Taney, in Bank v. Earle, 13 Pet. 595, thus:
“Franchises are special privileges conferred by government upon individuals, and do not belong to the citizens of the countiy generally, of common right. It is- essential to the character of a franchise that it shou’d be a grant from the sovereign authority, and in this country no franchise can be held which is not derived from a law of the state.”
If this were the only meaning of the word “franchise” in this section, many other provisions of the law would be meaningless. Thus, other provisions of this law distinctly apply, not only to corporations, but to companies and associations'who have no corporate existence, and who have no franchise. ' They apply to domestic companies and associations, as well as to foreign companies and associations. And so the capital stock, the value of which is to be ascertained by this board of valuation and assessment, applies, by the express provisions of the other sections, to associations and companies, as well as to corporations. As we construe the law, the legislature intended that the corporations, companies, and associations named in the various sections should be treated as an entirety, and taxed as such; and in using the words “capital stock” it intended to include all of the property of these corporations, companies, and associations, and to have all of the property valued as an entirety.
The information which is required of the corporations, companies, and associations, both foreign and domestic, by sections 4078 and 4079, is for the purpose of enabling the board of valuation and assessment to value and assess the capital stock of the corporations, companies, and associations. . The capital stock to be valued by the board includes the entire property, tangible and intangible, wherever situated, and from this value is to be taken all of its tangible property, wherever situated, assessed for taxation in this state or elsewhere. The value of this tangible property is to be taken from the valuation of the entire capital stock, and what remains is the value of the property which is to be taxed under the provisions of this act. Section 4079. Thus, the tax mentioned in section 4077 is not an additional tax upon the same property, but a tax upon the intangible property of the corporation, company, or association, that has not been taxed as tangible property. And it is provided in another section that, if the corporation, either foreign or domestic, “be a railroad, telegraph, telephone, express, sleeping, dining, palace, or chair car company, the lines of which extend beyond the limits of this state, that the proportion of the value of the capital stock which the length of the lines operated, leased, owned or controlled, in this state bears to the total length of the lines owned, leased, or controlled in this state and elsewhere shall be considered in fixing the value of the corporate franchise of such corporation liable for taxation in this state.” The same rule is applied to local taxation authorized-by counties, cities, etc., and, in addition, all tangible property locally taxed is to be deducted. Section 4081. Thus, the taxation of these corporations’, companies’, and associations’ intangible property is taxed upon the basis of the mileage of the lines inside and outside the state. This taxation assumes that there is used in the [23]*23common business of the companies, corporations, and associations inside tlie slate an average proportion of its intangible property.
Notwithstanding the use of the words “franchise” and “corporate franchise” in the several sections of this statute, we are of the opinion that the property to be taxed under its provisions as intangible property is not confined to franchises or corporate franchises, but it is intended to include all intangible property, by the mode indicated, whether or not such property be legally “franchises” or “corporate franchises.” It is not a lax upon an occupation or franchise granted by other states or by the United States, but a tax upon the property owned and enjoyed by ¡.hese several associations, companies, and corporations, which is claimed to be within the taxing power of the slate. The power of taxation by a state over telegraph companies is clearly stated by Chief Justice Fuller in a recent case, lie says:
“It is settled that where, by way of duties laid on the transportation of the subjects of interstate commerce, or on the receipts derived therefrom, or on the occupation or business of carrying it on, a tax is levied by a state on interstate commerce, such taxation amounts to a regulation of such commerce, and cannot iio susiumed. But the property in a state lielonging to a corporation, whether foreign or domestic, engaged in foreign or interstate commerce, may be taxed, or a tax may be imposed on tlie corporation on account of its property within a state, and may take the form of a tax for the privilege of exercising its franchises within the state, if the ascertainment of the amount is made dependent in fact on the value of its property situated within the state (tlie exaction, therefore, not being susceptible of exceeding the sum which might be leviable directly thereon), and if payment be not made a condition precedent to the right to carry on the business, but its enforcement left to the ordinary means devised for the collection of laxes. The corporation is thus made to bear its proper proportion of the burdens of the government Tinder whose protection it conducts its • operations, while interstate commerce is not in itself subjected to restraint or impediment.”
And, again, he says:
“Doubtless, no state could add to the taxation of property, according to the rule of ordinary property taxation, the burden of a license or other tax on the privilege of using, constructing, or operating an instrumentality of interstate or international commerce, or for the carrying on of such commerce; but the value of property results from the use to which it is put, and varies with the profitableness of that use, and by whatever name the exaction may be called, if it amounts to no more than the ordinary tax upon property, or a just equivalent therefor, ascertained by reference thereto, it is not open to attack as inconsistent with the constitution. Railway Co. v. Backus, 154 U. S. 439-45, 14 Sup. Ct. 1122, 1124.” Cable Co. v. Adams, 155 U. S. 695-697, 15 Sup. Ct. 269, 270.
See, also, Pullman’s Palace-Car Co. v. Pennsylvania, 141 U. S. 18, 11 Sup. Ct. 876.
In that case (Cable Co. v. Adams) the court sustained a tax upon the telegraph company which was distinctly a tax for the privilege of doing business in the state, upon the ground that it was no more than the property itself ordinarily would be burdened by an ad valorem tax; and in discussing the character of the tax as being a privilege tax, tbe court say:
“In marking The distinction between the power over commerce and municipal power, literal adherence to particular nomenclature should not bo allowed to control construction in arriving at the true intention and effect of stale legislaiion.” Page 700, 155 U. S., and page 271, 15 Sup. Ct.
[24]*24The case of W. U. Tel. Co. v. Attorney General of Massachusetts, 125 U. S. 530, 8 Sup. Ct. 961, is, we think, distinctly in point, not only in regard to disregarding the nomenclature of the state statute, but also as to the constitutionality of a tax like the one now being considered. In that case the state of Massachusetts enacted a tax law which is substantially in terms that of the Kentucky statute as to ascertaining the cash value of the capital stock of the corporations and associations either organized under its laws or foreign corporations doing business in the state, except that, in the assessment and tax complained of there, no deduction was made for real estate situated outside of the state of Massachusetts, and which was valued at over |3,000,000, and presumably taxed elsewhere, when the facts showed that there was no real estate of the company within the territorial limits of that state. That law required that a tax should be paid upon its “corporate franchise” at a valuation equal to the. aggregate value of the shares of its capital stock, as determined in the mode prescribed therein, and this was made applicable to corporations or associations chartered or organized elsewhere than in the state. Justice Miller, in the course of the opinion (page 547, 125 U. S., and page 963, 8 Sup. Ct.) said:
“The argument is very much pressed that it is a tax upon the franchise of the company, which franchise, being derived from the United States by virtue of the statute above recited, cannot be taxed by a state; and counsel for appellant occasionally speaks of a tax authorized by the law of Massachusetts, upon this as well as other corporations doing business within its territory, whether organized under its laws or not, as a tax upon their franchises. But, by whatever name-it may be called, as described in the laws of Massachusetts, it is essentially an excise upon the capital of the corporation. The laws of that commonwealth attempt to ascertain the just amount which any corporation engaged in business within its limits shall pay as a contribution for the support of the government, upon the amount and value of the capital so engaged by it therein.”
This case has been frequently cited, and has been approved in the cases of Massachusetts v. W. U. Tel. Co., 141 U. S. 41, 11 Sup. Ct. 890, and Cable Co. v. Adams, 155 U. S. 699, 15 Sup. Ct. 270. In the case of Massachusetts v. W. U. Tel. Co., 141 U. S. 45, 11 Sup. Ct. 891, Justice Gray again says, in speaking of this Massachusetts tax, that:
“By whatever name the tax may be called, as described in the laws of Massachusetts, it is essentially an excise upon the capital of the corporation, and these laws attempt to ascertain the just amount which any corporation engaged in business within its limits shall pay, as a contribution for the support of its government, upon the amount and value of the capital so employed by. it therein.”
This mode of ascertaining and assessing the value of the property has been sustained by the supreme court in the case of Railway Co. v. Backus, 154 U. S. 439, 14 Sup. Ct. 1122; and also the circuit court of appeals, in Sanford v. Poe, have held a law of Ohio, not unlike this one, as not within the inhibitions of the federal constitution. See 16 C. C. A. 305, 69 Fed. 547.
This bill states with some detail the complainant’s different kinds of property in this state on the 15th of September, 1893, and its value as claimed by it, and the valuation and assessment of its property on that day ás made by the board of valuation and as[25]*25sessment, and insists that there is property included therein which is not legally taxable in this state; but it nowhere alleges that the valuation and assessment by this board is not in compliance with the provisions of the Kentucky statute, nor does it seek to have the board’s valuation and assessment corrected, either as^ to the kind of property included in the assessment or the valuation placed upon it. On the contrary, it. is alleged that the complainant refused to recognize this board, or its valuations or assessments, as valid or legal in any respect whatever. As the statute does not indicate or describe the property which is to make up the capital stock required to be valued and assessed, we can only consider, now, whether the.statutory mode prescribed is a violation of the federal constitution.
The allegation that the complainant has given in, and that the state has assessed, all of its property, including telegraph lines, moneys, and credits, within the state of Kentucky, and that this tax has been fully paid, when taken with the other allegations of the bill, does not show that all the intangible property which is provided for in the Kentucky statute has been legally assessed and the tax paid thereon. If, in fact, the board lias, in making up the value, estimated patent rights, — ’that is, the monopoly granted by the United States, — or any other property which should not: have been valued in making up this assessment, the bill is not drawn with a view to raise such a question. Under the Kentucky statute the intangible property of this corporation cannot be assessed, except: by this board of valuation and assessment, and hence we cannot: assume, from any allegation of the bill, that, the property which was assessed by this board has ever been legally returned for taxation, or the taxes paid thereon. We conclude that the mode prescribed by this statute for valuation and assessment is not within the commerce clause of the federal constitution, nor do we see that it violates the provisions of the fourteenth amendment, of the federal constitution. Bell’s Gap R. Co. v. Pennsylvania. 134 U. S. 10 Sup. Ct. 533.
The next inquiry is whether or not these provisions of the Kentucky statute are in violation of the Kentucky constitution. Considering the tax which is assessed under the valuation and appraisement of the board as a property tax, the only inquiry, under the Kentucky constitution, is whether or not it: is a uniform tax with other property taxed in the state.
Section 4020 requires:
“All real and personal property within the state, and all personal property of persons «'siding in the state, and of all corporations mganized raider the laws of this state, whether the property he in or out of the state, including intangible property, shall he considered and estimated in fixing the value of the corporate franchises as hereinafter provided, and shall he subject to taxation, unless exempted by tlie constitution, and shall be assessed at its fair cash value estimated at the price it would bring' at a voluntary sale.”
Suction 4077, in describing tlie persons who are liable to this tax for intangible property, includes all corporations. There is, therefore, perfect: uniformity as to all corporations and the rate [26]*26of tax levied thereon. The provisions of section 174 of the constitution, which require that “all property whether owned by natural persons or corporations shall be taxed in proportion to its value, unless exempted by the constitution; and all corporate property shall pay the same rate of taxation paid by individual property,” — do not preclude intangible property which is owned by a corporation from being taxed.
If individuals .own intangible property which is taxable, it should be taxed like corporate property owned by corporations, under the constitution. Indeed, individuals are so taxed, in this statute, when they are associated together in companies. But if there is a kind of intangible property owned by corporations, which from its very nature cannot be owned by individuals, then there is no reason why the state should not tax that intangible property. It is not an objection to taxing property of a corporation, domestic or foreign, that no individual taxpayer has similar property. There is no allegation in this bill, and nothing in this record, which presents the question of making a discrimination between individuals owning intangible property or the corporations or associations mentioned in section 4077 owning such property. The court regrets extremely that these provisions of the constitution and of the revenue law have not been construed by the Kentucky court of appeals. There are three cases in which the matter of taxation under the present constitution has been discussed by the court of appeals. Although the question now being considered has never been decided, I understand, both from the case of Levi v. City of Louisville (Ky.) 30 S. W. 973, and Henderson Bridge Co. v. Com. (Ky.) 31 S. W. 486, that the court construed the provisions of these statutes, which require the valuation and assessment of the capital stock to include all of the tangible and intangible property of the corporation, company, or association, as herein indicated. Those cases, with the case of Association v. Norman (Ky.) 32 S. W. 952, lay more stress upon the term “franchise” than I have done in this opinion. I, however, construe the opinions in those cases to mean that “intangible property,” in the revenue law, not only includes the value of franchises, but also any other property rights which the companies or the associations may own, and which are taxable.
We are of the opinion that the present bill does not present the question of what particular property may or may not be taxable in the state of Kentucky, and which might be included by the board of valuation and assessment in making up the total of its capital stock under the provisions of the revenue law of the state of Kentucky; but I simply decide that the law as it stands on the statute books does not violate either the federal or the state constitution. The demurrers in this case (No. 250), and in cases Nos. 249, 251, and 194, should be sustained, and it is so ordered.
Opinion on Demurrer to the Bill as Amended.
The bill as amended does not change the questions decided on the original bill. But, as the amendment ah [27]*27leges that there is a large amount of moneyed capital in the state, employed in mining, manufacturing, commercial, and other industrial pursuits, by corporations whose intangible property, at least in part, is not taxed under the Kentucky statutes, it is proper that we should indicate our construction of those statutes. The language of section 4077 is:
“Every railway company or corporation, and. every incorporated bank, trust company, guarantee or security company, gas company, water company, ferry company, bridge company, street railway company, express company, electric light company, electric power company, telegraph company, press dispatch company, telephone company, turnpike company, palace car company, dining car company, sleeping oar company, chair car company, and also every other like company, corporation or association, also every oilier corporation, company or association having or exercising any special or exclusive privilege or franchise not allowed by law to natural persons, or performing any public service, shall, in addition to the other taxes imposed on it by law, annually pay a tax on its franchise to the state and a local tax thereon to tlie county, incorporated city, town and faxing district where its franchise may he exercised.”
We think the words in this section, “also every other corporation, company or association having or exercising any special or exclusive privilege or franchise not allowed by law to natural persons, or performing any public service,” must include all corporations, and cannot be confined to those corporations which are of like character to those specifically named. If this be not so, the words, “also every other corporation, company or association,” in this section, are meaningless, as the preceding words “every other like company, corporation or association,” had theretofore been ex: pressly included, if this construction be the correct one, then there is no discrimination between moneyed capital employed by corporations in mining, manufacturing, commercial, and other industrial pursuits, and that employed in railroads, telegraph companies, express companies, and other like companies, but the intangible property of all corporations is taxed, and taxed at the same rate. It is true that the provisions of sections 4077 and 4078 do not apply to all individual taxpayers, but a reference to section 4020 of the Kentucky Statutes, and the schedule which must be returned by each taxpayer, provided by section. 4058, indicate, we think, that there is no intention on the part of the state to exempt individual taxpayers from a tax upon all of their intangible property, whatever that may be. In the description of property tax in tlie schedule, the first 11 articles required to be returned by taxpayers generally are of intangible property, and under the head of “Miscellany” the value of all property not mentioned specially is required to be returned. It is true that the mode of the assessment of intangible property of corporations, companies, and associations mentioned in section 4077, and that of individual taxpayers, is different, under the statutes, and it is perhaps true that the intangible property of these corporations and associations may be in some respects different from intangible property which belongs to individual taxpayers, and which is taxed; but I see nothing in the statutes which exempts any intangible property, owned by any corporation or any individual taxpayer, which is taxed [28]*28when owned by any other corporation or individual. Although, as indicated in the original opinion, we do not think that a tax levied upon intangible property is strictly a franchise tax, though called so in the statute, but a property tax, yet it is quite clear that the value of the franchise is intended to be estimated as intangible property. The 172d section of the constitution declares:
“All property not exempt from taxation by tliis constitution sliall be assessed for taxation at its fair cash value estimated at the price if would bring at a fair and voluntary sale.” s
Thus, a fair cash value, and the rule for estimating such valuation, is fixed by the constitution itself. But this constitutional rule of valuation of property for an ad valorem tax does not prevent the legislature from prescribing the mode or method of ascertaining the different kinds or quantities of taxable property belonging to the several taxpayers, whether they be natural or artificial persons. Nor does it prescribe how or by whom the assessment for taxation shall be made, except as to the valuation. All else as to the mode of assessment, we think, is left within the discretion of the lawmaking power. Thus, an assessment may be made by one assessor, or by a board of assessment and valuation, and may be made in any manner that is just and equitable.
Neither does this section, nor any other provision of the constitution, confine the levy of an ad valorem tax to tangible property; but, as decided by the Kentucky court of appeals in Levi v. City of Louisville, 30 S. W. 973, it does require the levy of an ad valorem 'tax upon personal property as well as real estate, and this case decides that a license tax, which is not a property tax, cannot be substituted for an ad valorem tax upon personal property engaged in certain commercial pursuits in the city of Louisville. It does not decide that section 171 of the constitution, which declares that taxation shall be uniform upon all property subject to taxation within the territorial limits of the authority levying the tax,, applies to taxation based upon income, license, or franchise. If there is any intimation upon the subject in this case, it is that taxation which is based upon income, license, or franchise may be classified by the legislature,' and, as to licenses, they may be levied upon some employments and occupations, and not upon others. If, however, we are correct in our construction of the Kentucky statutes, there is no ground for contending that there is a want of uniformity in the levy of the taxes against the defendant, even though section 171, requiring uniformity of taxation upon all property subject to taxation, applies to taxation based upon income, license, or franchise, and is given its broadest possible construction. If we are correct in our view, it is not necessary for us to consider whether the Kentucky constitution (sections 171-174) requires a taxation upon all property, tangible or intangible, within the territorial limits of the authority levying the tax, and at a uniform rate, or only requires a uniform rate of taxation upon a class of property made subject by law to taxation within the taxable limits; nor is it necessary to consider whether, if the rule of universality and [29]*29uniformity applies to an ad valorem tax, it also applies to taxes based upon income, license, and franchise. The demurrer to the bill as amended should therefore be sustained, and it is so ordered.