I'm thinking the letter you can't make out are L.S. & which would make this a pretty darn old button. Congratulations!
The McGuinn-&-Bazelon book on button backmarks says the "L.S. & Sperry" in your button's backmark is Leavenworth, Spencer, & Sperry, of Waterbury CT, a button-making firm which was only in business from 1835 to 1839.