Court Opinion

ID: 9642390
Source: CourtListenerOpinion
Date Created: 2023-08-22 17:56:25.063686+00
Date Added: 2024-06-11T11:48:58.542447
License: Public Domain

SOPER, Circuit Judge
(dissenting).
In United Drug Co. v. Theodore Rectanus Co., 248 U.S. 90, 97, 39 S.Ct. 48, 50, 63 L.Ed. 141, it was held that *611a trade-mark right is not a right in gross or at large, like a statutory copyright or a patent for an invention, to either of which, in truth, it has little or no analogy. The court • said: “There is no such thing as property in a trade-mark except as a right appurtenant to an established business or trade in connection with which the mark is employed. The law of trade-marks is but a part of the broader law of unfair competition; the right to a particular mark grows out of its use, not its mere adoption; its function is simply to designate the goods as the product of a particular trader and to protect his good will against the sale of another’s product as his; and it is not the subject of property except in connection with an existing business. Hanover Star Milling Co. v. Metcalf, 240 U.S. 403, 412-414, 36 S.Ct. 357, 60 L.Ed. 713.” (Italics inserted'.) See, also, American Steel Foundries v. Robertson, 269 U.S. 372, 380, 46 S.Ct. 160, 70 L.Ed. 317.
Long and Isenhour and Old South Brewing Company, Inc., the corporation which they formed, are attempting in this case to establish title to the name “Old South Brew,” not through its use in connection with an existing business of their own, but through its mere adoption as a trade-mark to be hereafter used in a business which they hope and intend to found, but so far have not yet begun. The undisputed evidence is that during the period from September, 1933, to May, 1934, in which beer was sold as “Old South Brew” by the Eastern Beverage Corporation, they neither manufactured, bought, sold, or owned any beer; and these facts must be borne in mind in order not to misunderstand allusions in the statement of the case to the manufacture of beer for their account or the shipment of beer to their customers. They had in fact no beer business. They did persuade the Eastern Beverage Corporation to ship beer of its manufacture under the label “Old South Brew,” and they did aid that company in securing customers; but the beer was marked with the name of the Eastern Beverage Corporation, and not with the names of Long and Isenhour (or the name of their corporation), and the buyers were the customers of the former corporation and not of the latter. At the outset they received two small payments for their services, but this practice was speedily abandoned because competition made the expense too great for the Eastern Beverage Corporation to stand, and thereafter they received no compensation whatsoever, and orders for the goods were sent directly from the distributors to the Beverage Corporation. Their only connection with an established as distinguished from a prospective business was in the character of salesmen serving for a brief period without pay. The helpful discussion of Judge Hough in Baldwin Co. v. R. S. Howard Co. (D.C.) 233 F. 439, affirmed (C.C.A.) 238 F. 154, demonstrates that a salesman does not acquire property in a trademark in this manner.
It is not contended that Long and Isenhour gained title to the trade-mark through the assignment from the Eastern Beverage Corporation made at the beginning of the period. The assignment amounted to nothing more than a declaration of nonownership on the part of the corporation, for a trade-mark cannot be assigned except in connection with an assignment of the business in which it has been used. It cannot be assigned in gross. Brown Chemical Co. v. Meyer, 139 U.S. 540, 11 S.Ct. 625, 35 L.Ed. 247; Belden v. Zophar Mills (C.C.A.) 34 F.(2d) 125.
It is suggested, however, that it is enough to support a claim of ownership in a trade-mark that the goods upon which it is used are manufactured for the claimant, or “that they pass through his hands in the course of trade and that he gives to them the benefit of his reputation and name or business style.” This statement is true if the words are spoken of a claimant who has an established business; for example, it was shown in Nelson v. J. H. Winchell & Co., 203 Mass. 75, 82 89 N.E. 180, 23 L.R.A.(N.S.) 1150, from which the quotation is taken, that the goods were manufactured specially for the claimant and in accordance with his directions; that he himself was responsible to purchasers, dictated the stock to be used and the manner of manufacture, and went to the factory to see that his ideas were carried out. Something less than this will doubtless be sufficient, but at least the claimant must be so connected in a responsible capacity with the manufacture or distribution of the goods in an established business that the trademark may perform its legitimate function to designate the goods of a particular trader. In the pending case, the trade*612mark indicated the goods of Eastern Beverage Corporation; and the goods themselves did not pass through the hands of Long and Isenhour in any capacity whatsoever. It is noteworthy that in all of the cited cases in which the trademark was sustained as having been used in connection with a distributing business, the goods passed through the hands of the claimant 'as the owner thereof.
In June, 1934, after the shipment of Old South Brew by the Eastern Beverage Company had ceased, the Southeastern Brewing Company began to use the name on its product, although it knew from the public announcements of Long and Isenhour that they intended to use it in the business of the Old South Brewing Company, Inc., when its new brewery should be built; and it is suggested that such conduct should be condemned. With this suggestion there is complete accord; but every act of business cunning is not justiciable in the courts. The case should turn upon the inquiry whether the Old South Brewing Company, Inc., has gone far enough to gain an exclusive legal right which it is entitled to protect; and it is submitted that the effort and expense attendant upon the selection of the name and the advertisement of its intended use in a future business did not create a title that could be judicially enforced. ' Quite the contrary was held in Maxwell v. Hogg, L.R. 2 Ch. 307, in which the plaintiff conceived a name for a new magazine and inpurred considerable expense in advertising it and in preparing for publication. Before publication the defendant, knowing of this, hastily brought out a magazine of his own under the same name. It was decided that prior to actual publication, the plaintiff acquired no property in the name, and hence could not restrain its use by his competitor. The court said (L.R. 2 Ch. 307, 311) : “That expenditure upon a work not given to the world can create, as against the world, an exclusive right to carry on a work of this nature, seems to me a proposition quite incapable of being maintained. It never, so far as I am aware, has been thought that any such equity exists. Then, if the expenditure alone will not confer such a right, will the advertisements do so? Such an advertisement is nothing more than an announcement of an intention on the part of the plaintiff to publish in the month of October following a work under a given title. Gan that be considered as constituting in him an equitable title, or any title, to the name under which that work is to be published? If it is to be considered as doing' so, the consequence will be that, without having made any new publication at all, he might come to this court saying: T have advertised my intention to publish in October a given work under a given title, and nobody else shall publish a work under that title until I have had an opportunity of bringing my work before the public.’ He does not by his advertisements come under any obligation to the public to publish the work, and therefore the effect of holding the advertisements to give him a title would be that, without having given any undertaking or done anything in favour of the public, he would be acquiring a right against every member of the public to prevent their doing that which he himself is under no obligation to do, and may never do.”