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TMI Blog1927 (1) TMI 1X X X X Extracts X X X X X X X X Extracts X X X X ..... r troops but which were now being disposed of. They had been manufactured by the British American Tobacco Company Limited itself and were thus-genuine Gold Flake cigarettes and not counterfeit. The plaintiff bought them cheap at eight or nine shillings per thousand. 3. His case is that he contracted to buy 860 cases being 21 1/2 million cigarettes, that he disposed of some (apparently 194 cases) in Egypt and elsewhere, and that early in 1922 he came to India not merely to dispose of 666 cases already contracted for but also with a view to establish a continuing market in these war stocks of which further supplies in very large quantities were available or would become available. 4. Now Gold Flake cigarettes were and lire sold in large quantities in India by the defendant company which is a subsidiary or associated company of the British American Tobacco Company Limited, the latter company holding at least 80 per cent of its shares. The defendant company had in 1910 acquired the business and trade-mark rights of the British American Tobacco Company Limited so far as India, Burma and Aden are concerned. For years it alone had been selling Gold Flake cigarettes in India an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ved on 5th April and the cable of 10th April (which has been ruled out by the learned Judge for reasons which I do not appreciate) show what happened. The company's solicitors in India did not think they could do anything. Mr. Macnaghten in England advised that they could. He knew all about the defendant company's trade-marks and in a matter of this sort and of this importance it was most reasonable to take advice in London. It was after all a question of trade-marks law and Mr. Macnaghten was their legal adviser. It seems idle to suggest that the plaintiff has a grievance because the defendant company took advice from him. 7. The defendant company decided to take steps to establish that the plaintiff's scheme was an invasion of their rights. They thought it wise to take a formal assignment of the marks by way of perfecting their equitable title under the indenture of 1910 and this was not completed till the 10th May 1922. Meanwhile they applied under the Sea Customs Act to the Collector of Customs at Calcutta and at Bombay on 12th April and 1st May. The applications are in evidence and state that the goods are liable to confiscation because we consider that the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the fact that the learned Judge thinks that the defendant company, in applying for detention of these goods under the Sea Customs Act, were acting maliciously. It is clear that the facts as to the origin of the goods were made quite clear to the Collectors of Customs and were not in any wise misstated in either application, both of which gave as the ground infringement of our trade-mark rights. But it is said that if one looks at Clause (d), Section 18 of the Act it is apparent that the defendant company were maliciously accusing the plaintiff of a criminal offence and fraud, and were asking for a detention to which they knew they had no right. 12. It is desirable to add that there do not appear to be any regulations under Section 19-A, Sea Customs Act, but proceedings of the character now in question are governed in practice by certain instructions for the observance of Customs officers published under authority of the Government of India in the Merchandise Marks Manual. 13. As I read these instructions they provide that if the informant is willing to give an indemnity bond the Collector, unless he is of opinion that there is clearly no reasonable cause for detention ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in the Alliance Bank and the interim injunction was dissolved. There is no suggestion of any false statement or suppression made by the defendant company on this occasion. Indeed on asking to be referred to the affidavits I am informed that they were not even put in evidence in the present case. The suit came on for hearing promptly. It was heard by the same learned Judge whose decree in this case is now under appeal and was dismissed by him on 18th July 1922. An appeal to this Court was dismissed on 10th April 1923 : Imperial Tobacco Co. v. Albert Bonnan AIR1924Cal216 , and an appeal to His Majesty in Council shared the same fate on 13th May 1924 Imperial Tobacco Co. v. Albert Bonnan A.I.R. 1924 P.C. 16. The suit in Bombay was filed on 22nd May 1922 and notice of motion for an injunction was given for 2nd June. It was heard on 19th June, that is, after the injunction given in Calcutta had been dissolved. On the 19th June the matter was settled by cross-undertakings. The plaintiff undertook pending the hearing not to sell any cigarettes then in Bombay or to arrive in Bombay and the defendant company undertook in damages. The plaintiff's undertaking not to sell was discon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ustification an order of the Court which was disregarded because it was irregularly obtained by the defendant. To speak of an injunction as on a par with such a case as being an act in the nature of trespass to property. is merely to obscure matters by a false analogy or else to beg the question. Section 95, Civil P.C., is rendered almost absurd by such a doctrine. 20. On the 11th May 1922 when the interim injunction was obtained in Calcutta restraining the plaintiff from removing from bond or selling or disposing of 100 cases of cigarettes then lying with the Customs, the defendant company gave an express undertaking in damages. This was an undertaking to the Court and the character of such an undertaking has been discussed in the case of Smith v. Day [1883] 21 Ch. D. 421. It is not such an undertaking as amounts to contract with the other party, nor does it ground any action at common law. It is to be enforced by application to the Court to which it was given and in the suit or proceeding in which it was given. The right to ask for an enquiry as to damages there under may be lost by delay but there is no rule that an enquiry must be asked for when the injunction is disso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cutory injunction, an action will lie at common law for the damage done to his business by the injunction. But I think it right to say that this proposition is one to which I refuse assent. I respectfully agree with the observations of Fletcher J. in Mohini Mohan v. Surendra Narain [1914] 42 Cal. 550 and with the decision in that case. It is the duty of a Judge before granting an injunction to satisfy himself that the plaintiff is not without reasonable and probable cause - indeed to satisfy himself, that it will stand a higher test. Unless the malice of the plaintiff results in some form of misstatement or leads the plaintiff to suppress some fact or facts - it was his duty to lay before the Court - I have much difficulty in seeing how the granting of the injunction is causally related to the plaintiff's act or state of mind. The present case is probably unique in that no attempt is made to prove what was laid before the Court or that it contained any element of falsity. The granting of an injunction is a judicial act in the fullest sense : it is not a ministerial order or an order of course or mesne process or a necessary incident of any particular jurisdiction. The Quartz Hi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rchase of cigarettes from Messrs. Venis and Company. In para. 18 of the plaint the plaintiff says that the Army Canteen Board cancelled 258 cases of cigarettes by reason of which he was put to a loss of ₹ 1,09,549. In para. 16 he says that 160 cases, portion of 220 cases which he had contracted to sell in Bombay have not been shipped to India, but in Ex. O. as the summary of his claim which the learned Judge has acted upon, he definitely states of these 160 cases also that they were cancelled by sellers in England. Now it appears that the cancellations relied upon are cancellations made by the plaintiff himself and not by his sellers. On the 17th May 1922, he wrote to Messrs. Venis and Company: Regarding my order of the 21th December for five million cigarettes, I very much regret to inform youth it owing to an injunction served upon ma by Messrs. Imperial Tobacco Co. of India Ltd. here, which restrains me from importing the goods, I shall not be able to take delivery of the cigarettes and therefore please cancel same and oblige. 25. On the 6th June 1922 he wrote to Messrs. Venis and Co. I am in receipt of your letter of the 16th May for which I thank you. I note t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e they did not wish to offend the defendant company : others because the defendant company would refuse to deal with them or to deal with them on the same favourable terms as before; others because they anticipated that they too might become involved in litigation if they dealt in plaintiff's goods; others again because they were definitely informed that the defendant company were prepared to assert their rights to prevent the plaintiff's cigarettes being sold in India by bringing whatever suits were necessary to establish and enforce their alleged right. The learned Judge has held that the defendant company made full use of the litigation in Bombay and Calcutta with its attendant threat of trouble to others as an obstruction to the plaintiff and as a deterrent. 28. He has further held that the suits were throughout designed as a disparagement of the plaintiff's goods and an obstruction to the unfettered exercise of his rights as a trader, of which I have no doubt the company made the fullest use the whole time of the litigation lasted and whenever occasion so required. 29. These observations of the learned Judge are to be coupled with his finding that the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld not point to a single instance since. Westminister Hall began to be the seat of justice, in which an ordinary action similar to the actions of the present day, has been considered to justify a subsequent action on the ground that it was brought maliciously and without reasonable and probable cause. Quartz v. Hill case [1883] 11 Q.B.D. 674. 32. Lord Bowen in saying this had clearly before his mind that incidentally matters connected with the action, such as the publication of the proceedings in the action, may do a man an injury; and Brett, M.R., in deciding that a petition to wind up a company was within the exception mentioned in Savile v. Roberts [1997] 1 Ld. Raym. 374 stated: the present case is reduced to this question namely : Is a petition to wind up a company more like an notion charging fraud or more like a bankruptcy petition. 33. If injury to the fair fame of a person is not for this purpose a consequence of an action charging fraud, it is impossible to contend that injury to his business is, in such a case as the present, a cansequence of the mere bringing of the suit. 34. The second question which arises in cases of this sort is as to what is meant by mal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 18a where the defendant had brought a suit alleging against her own knowledge that a certain lease, which was a forgery and which she knew was a forgery gave her title to the land. It is clear from his judgment that the furthest limit to which Blackburn, J., was prepared to go was that if a man sue me in a proper Court, yet if his suit be utterly without ground of truth, and that certainly known to himself, I may have an action of the case against him for the undue vexation and damage that he putteth me unto by his ill practice. 38. The case before him was one in which the defendant had warned persons who had purchased or were intending to purchase machines from the plaintiff, that the machines sold by the plaintiff were infringements of the defendant's patents and that if they used the machines, he would claim royalties and should take legal proceedings. The actual decision was a s follows: If, therefore, the plaintiffs had given evidence, on which the jury might properly find that the defendant made the communication to the intended purchasers mala fide, and without any intention to institute legal proceedings at all against the purchasers, so that it was not a step ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of this contention : Imperial Tobacco Co. (Newfoundland) Ltd. v. Duffy [1918] A.C. 181 and Dunlop Rubber Co. v. Booth 43 PC 139. It is necessary, therefore, to see whether it can be imputed to the defendant company that their superior officers were well aware that they had no case for claiming that their assignment of all the Indian rights in the Will's trade-mark should carry a similar consequence, It cannot I think be contended on a perusal of the proceedings at the trial or in appeal that the defendant company were treated by the Courts as persons advancing an idle claim. The case offered no little scope for dispute upon the principles of law applicable. Nor was it one in which the careful sifting of somewhat numerous, and complicated considerations was unnecessary. The learned Judge who tried the case gave a very clear analysis of the whole matter, but I do not find in his judgment dismissing the suit an indication that he found the decision of it to be noticeably free from difficulty. In matters of trademark law the directors of a company are necessarily in the hands of their legal advisers. In this case they had received from the solicitors in India advice to the effect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nion wholly failed to show that either suit was brought mala fide, without belief that the defendant company had any reasonable cause or from oblique motives other than a motive to make their case good in furtherance of their own trade interests. I do not see that their case, though it turned out to be bad and has been overruled for reasons which I do not presume to challenge, was in any way such as to make it wrong or unreasonable for them to lay it before the Court. 42. With regard to the allegation that the defendant company maliciously threatened to harass the plaintiffs' customers with vexatious litigation, I do not know what threats in particular, if any, the learned Judge has considered to be proved, and I fail to find this allegation in the plaint. It appears to me that what I have already said is sufficient to dispose of any question as to threats, whether threats to litigate or threats to boycott, as such threats are unlawful only where the purpose of the threat is wilful and ultraneously to injure the trade of another as distinct from the purpose to forward one's trade : Sorrell v. Smith [1925] A.C. 700. 43. The plaintiff further claims damages for wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is any indication of or reference to any slander now relied upon or anything else that looks like slander of goods. The defendant company, in August, examined de bene esse Mr. Abbott, their Chairman, and I see in his cross-examination no reference to any other slanders uttered by him or in his presence save a reference to one of the two occasions already mentioned. The witnesses examined by the defendant company in July on commission in Bombay are asked nothing about slanders. 49. At the hearing in December 1925 the plaintiff called nine witnesses including himself. The plaintiff's evidence-in-chief upon this part of the case forms questions 258 to 266 and contains only the most harmless hearsay. The only witnesses called to speak to any question of slander of goods are Ardeshir Khodadad, Kali Pada Eoy, N.N. Chakrabarti and M.N. Jarvar. The learned Judge deals specifically with two only of the alleged slanders: one said to have been uttered by Carr to Khodadad in March or April 1922, and another said to have been uttered by Mr. Ryan and Akhil Pal in July 1922 to Kali Pada Roy and his partner's father, N.N. Chakrabarti. 50. On the hearing of this appeal it appeared to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... barred. But he says that it is a fair inference to draw from the evidence that the statements alleged and complained of continued to the extent already mentioned to be repeated within two years before suit. 53. Accordingly, as I understand, part of the damages which he awards is awarded for false and malicious statements made by persons unknown to persons unknown upon occasions and at times as to which the only information is that they were subsequent to January 1923. All that is known as to the contents of these statements is that they affirmed a non-existent difference in the quality of the goods. 54. What is supposed to be known as to the special damage caused is still more difficult to understand. Because, though the learned Judge has disallowed the claims in respect of detention of goods by the Collectors of Customs at Bombay and Calcutta, in respect of the undertaking given by the plaintiff to the High Court of Bombay, and in respect of all alleged slanders of goods prior to January 1923, lie has in the end awarded damages on the basis of compensation to the plaintiff for the whole of his loss of profit on all the cases destined for the Indian market which he had co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... slander, cf. Ratcliffe v. Evans [1892] 2 Q.B. 524. Proof of a conspiracy to slander the plaintiff's goods, proof of twenty slanders, part of a course of conduct, proof of orders to a group of servants to go out uttering slanders throughout a market - this might bring a case to the same level as a case of publication in a newspaper and require the Court as a matter of common-sense to let in evidence of general loss of business. But where is the necessary proof? The case is not a case of conspiracy or illegal combination as learned Counsel for the plaintiff expressly concedes. If the number of specific instances proved does not show slander broadcast, what is the evidence to contradict the evidence of Abbott and of Selfe '? Is it the evidence of the dismissed servant Carr? or Javar's evidence - not put to Carr of what Carr said to him? Carr's evidence in cross-examination is that practically it was left to them to do what they liked so long as they did nothing wrong. He does also say that he was told to tell the dealers that the plaintiff's goods were old stock from the army and were inferior in quality. This last element does not appear in his statement as to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eir efforts to persuade dealers that their article was superior : White v. Mellen [1895] A.C. 154 (165) Hubbock v. Wilkinson [1899] 1 Q.B. 86. In slander of goods the burden of proof of falsity is on the plaintiff and in my opinion he fails to prove this statement to be false. 59. In these circumstances I do not propose to discuss the question of limitation as to this head of claim, but in my opinion Section 24 and Article 36 give the plaintiff two years from the accrual of special damage. 60. In my judgment this appeal should be allowed. Treating this suit as an application in Suit No. 1610 of 1922 for an inquiry as to the sum to which the plaintiff is entitled as damages for loss caused to him by the injunction granted therein on 11th May 1922, we should order that such inquiry be held in the said suit by the Official Referee and direct that in ascertaining the said sum the Official Referee do not include any loss accruing to the plaintiff by reason of the cancellation of the contracts referred to in the plaintiff's letters of 17th May 1922 and 6th June 1922 to Messrs. Venis Co. Quoad ultra the suit should be dismissed. The plaintiff must pay to the defendant compan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the sale by the present plaintiff in India of the said cigarettes involved no breach of contract, misrepresentation, or infringement of the rights of the present appellants, and that it had not been shown that the latter had acquired any independent reputation as importers of the said cigarettes. Their Lordships of the Judicial Committee held confirming the judgments delivered in this Court that the present appellants' suit was not maintainable, see Imperial Tobacco Co. v. Albert Bonnan A.I.R. 1924 P.C. 187. 65. On the 28th February 1922 and on the 8th March 1922 the first lot of the plaintiff's goods arrived in Bombay and Calcutta respectively and he sold also certain cases to dealers. Thereupon the present appellants who had, up to then, exclusive rights of selling the said cigarettes in India, applied to the Collectors of Customs in Bombay and Calcutta for orders for detention of the plaintiff's goods, on the ground, among others, that having regard to the trade history of the appellants' cigarettes and the acquisition by them, as purchasers of the goodwill in India of the business with which the trade-mark Wills' Gold Flakes was associated, the importa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upees The acts complained of are referred to in paras. 6 to 11 of the plaint, and they may be classified as follows.: (a) Wrongfully and maliciously apply plying to the Collectors of Customs in Bombay and Calcutta and obtaining from them orders for detention of the plaintiff's goods. (b) Wrongfully and maliciously instituting and prosecuting suits against the plaintiff in the High Courts in Bombay and Calcutta. (c) Wrongfully and maliciously obtaining an injunction against the plaintiff from this Court as referred to above. (d) Wrongfully and maliciously giving notice of motion for an injunction against the plaintiff in the Bombay High Court in which proceeding the plaintiff was made to give an undertaking on the 19th June 1922. (e) Wrongfully and maliciously publishing various statements slandering the plaintiffs goods. 68. Mr. Justice Pearson held that the conduct of the appellants in regard to the proceedings before the Collectors of Customs in Bombay and Calcutta was malicious and without reasonable and probable cause. He also held that in filing the two suits in Bombay and Calcutta and in proceeding with them as they did, the appellants acted maliciously ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ufacturer or merchant aggrieved, there is nothing to prevent the customs officers from acting upon their own initiative. The sections of the Sea Customs Act which were referred to at the hearing before us are Sections 18 and 19A. The appellants might have taken an exaggerated view of their rights, but it appears that the customs officers really proceeded in this matter to act in accordance with the instructions for the observance of customs officers appearing on p. 11 of the Merchandise Majks Manuil (1925) issued by the Government of India. (The judgment then discussed facts and evidence and proceeded) Now the first question which arises for consideration is whether the present plaintiff has on the evidence before us, substantiated his contention that the statements made to the two Collectors of Customs were untrue in fact, that the said statements were made maliciously, and without reasonable and probable cause and that he has suffered special damage thereby : see the case of Nemi Chand v. Wallace [1907] 34 Cal. 495. From what has been stated above in my opinion there cannot be any doubt that the appellants did really believe in what they had stated to the customs authorities and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... retain after hearing the evidence. 72. The learned Judge further added, in dealing with the question of limitation raised on behalf of the defendant company as an answer to this part of the plaintiff's claim, the following: In so far as the cause of action may be slander of title or slander of goods the limitation would be either one year under Article 25 or two years under Article 36 : the latter is in my opinion applicable in the circumstances for I think the action would be on the case. Nevertheless I think it is a fair inference to draw from the evidence that the statements alleged and complained of continued, to the extent already mentioned, to be repeated within two years before suit, particularly having regard to the continuance of the previous suits which throughout were designed as a disparagement of the plaintiff's goods and an obstruction to the unfettered exercise of his rights as a trader, of which I have no doubt the company made the fullest use the whole time the litigation lasted and whenever occasion so required. I am not prepared to say that in any view of the matter the company is excused by the principle that a trader is entitled to protect his ow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .R. 86. It is not malice if the object of the trader is to push his own business. To make the act malicious it must be done with the direct object of injuring the other person's business. Therefore, the mere fact that it would injure that other person's business is no evidence of malice: see Dunlop Pneumatic Tyre Co. v. liaison Talbot [1904] 20 .L.R. 579. 76. This being the state of the authorities, I have carefully scrutinized the evidence of Sheriar and Khodadad and of the other witnesses on the side of the plaintiff taken along with the evidence of the officers of the defendant company and I have come to the conclusion that no statements in slander of the plaintiffs goods were made by the officers of the defendant company which would give rise to a cause of action. I am not unmindful that it was alleged on the plaintiffs side that the plaintiff's goods were said to have been described by Mr. Selfe, an officer of the defendant company, on one occasion as being kharab or unmerchantable; but I am unable to place any reliance on that piece of evidence. In what context was the word used, if used at all? I have grave doubts if it was at all used. The learned Judge say ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... od and substantial cause of action, must show that the false and malicious legal proceedings have been accompanied by damage express or implied. The reason why, to my mind, the bringing of an action under our present rules of procedure and under our present law, even if it is brought without reasonable or: probable cause and with malice, gives rise to no ground of complaint, appears to me easily to be seen upon referring to the doctrine laid down by Holt, C.J., in Savile v. Roberts [1697] 1 Ld. Raym. 374. He there said that there were three sorts of damages, any one of which would be sufficient to support an action for malicious prosecution, (1) The damage to a man's fame, as if the matter whereof he is accused be scandalous. And this was the ground of the case between Sir Andrew Henley and Dr. Burstall : Raym. 180....(2) The second sort of damages, which would support such an action, are such as are done to the person; as where a man is put in danger to lose his life, or limb, or liberty, which his been always allowed a good foundation of such an action.... (3) The third sort of damages, which will support such an action, is damage to a man's property, as where he is forc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s not deserve them, he ought not to get them in a subsequent action. Therefore, the broad canon is true that in the present day, and according to our present law, the bringing of an ordinary action, however maliciously and however great the want of reasonable and probable cause, will not support a subsequent action for malicious prosecution. I do not say that if one travels into the past and looks through the cases cited to us, one will not find scattered observations and even scattered cases which seem to show that in other days, under other systems of procedure and law, in which the consequences of actions were different from those of the present day, it was supposed that there might be some kind of action which, if it were brought maliciously and unreasonably, might subsequently give rise to an action for malicious prosecution. It is unnecessary to say that there could not be an action of that kind in the past, and it is unnecessary to say that there may not be such an action in the future, although it cannot be found at the present day. The counsel for the plaintiff company have argued this case with great ability; but they cannot point to a single instance since Westmini ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whether the matter is looked at from the point of view indicated in Quarts Hill Mining Co. v. Eyre [1883] 11 Q.B.D. 674 or from that referred to in Section 95, Civil P.C., the present plaintiff must in my opinion fail on the facts. On the evidence on record which I have read and re-read, I can find no trace of malice or of want of reasonable and probable cause on the part of the present appellants, in instituting the suits in this Court and in the Bombay High Court. They had received expert professional advice from London that they had a fair case to go to Court with, having regard to the authorities on the subject, and in these circumstances and without more it is difficult to see why the appellants' suits in Bombay and Calcutta should have been described as malicious. On this conclusion it is not necessary for me to refer to the question of limitation; but if I had to pronounce an opinion on the question of limitation, I should be prepared to hold that the plaintiff's claim for damages under this head is barred by Article c , Limitation Act. 80. I next come to the question whether the plaintiff has made out his case under claim (d). The facts in connexion with this br ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion would not lie. Then again the time at which the application is made is material. Having regard to the decisions, we are not entitled to say that the application for an inquiry must be made either when the injunction is dissolved, or at the trial. One of these must be the most proper time. The application may be made when the injunction is dissolved, but if made then it probably will be ordered to stand over till the trial. If made by motion subsequent to the trial, the party moving is subject to some disadvantage, for the application is one which should be made speedily and not after the Court has forgotten the circumstances; see also Grifit v. Blake [1877] 7 Ch. D. 490. 82. It would, therefore, appear that the enquiry into damages can be and is ordinarily had by means of an application to the Court which originally granted the temporary injunction. In this case, the proceedings, as will be seen from what has been stated above, did not finally terminate until the 13th May 1924. The present plaint was filed on 21st January 1925. It is contended, however, on behalf of the plaintiff that he is not limited to making an application in the suit in which the temporary injunction wa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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