A. Carmichel & Co. v. Latimer

• Decision Date: 11 November 1876
• Citation: A. Carmichel & Co. v. Latimer, 11 R.I. 395 (R.I. 1876)
• Court: Rhode Island Supreme Court
• Parties: A. CARMICHEL & CO. v. LATIMER, STILLMAN & CO. IN EQUITY.

11 R.I. 395

A. CARMICHEL & CO. v. LATIMER, STILLMAN & CO. IN EQUITY.

Supreme Court of Rhode Island.

November 11, 1876

A. C & Co., being the successors by purchase of Stillman &amp Co., woollen manufacturers, continued to use " Stillman & Co." as a trade-mark on their ticket for goods.Latimer, Stillman & Co., the lessees of a mill formerly used by Stillman & Co., known both as the " Stillman Mill" and as the " Seventh Day Mill," used " Stillman Mills" as a trade-mark.On a petition for an injunction, brought by A. C. & Co. against Latimer, Stillman & Co. to prevent their so using the word " Stillman," it appearing that no deception could be charged on either complainants or respondents, and that no person of the old firm of Stillman & Co. was a member of the firm of A. C. & Co.: -

Held, that the injunction could not be granted.

Held, further, that a manufacturer has the right to label his goods with his own name or that of his mill, if no fraudulent purpose is intended.

Query .If a trade-mark whose reputation depends on the excellence of the manufacture, or the skill and honesty of the manufacturer, can be legally assigned?

Query .If the English practice of retaining a firm name, when no original partner remains, is generally recognized in American law?

BILL IN EQUITY charging that the complainants used a ticket containing the words " Stillman & Co." as a trade-mark for their woollen goods, and that the respondents, manufacturers of woollen goods, some of which were like those of the complainants and some inferior to them, used on their goods a ticket resembling the complainants' ticket, and containing the words " Stillman Mills," with intent to defraud the complainants and the public.

The case was heard on a motion to enjoin the respondents from using the words " " Stillman" on their trade ticket.The facts are stated in the opinion of the court.

Stillman.

POTTER J.

The bill alleges that, from July 1, 1864, to April 1, 1871, George G.Still man, Amos Stillman, Jonathan P. Stillman, Thomas v. Stillman, Albert Stillman, and A. Carmichel were partners by the style of Stillman & Co., in manufacturing linseys, using on their goods a ticket or label containing " " Stillman & Co." on it as a trade-mark, and that they had acquired a considerable reputation for said goods.Albert died April 1, 1871, and his share was bought out by Amos, Jonathan, and Thomas, and the firm continued to November, 1871, when George bought the right to said ticket, and continued to manufacture until July 6, 1875, when he sold said ticket to the plaintiffs, whose firm consisted of A. Carmichel, William B. Lawton, George Carmichel, Jr., and W. P. Barney.The plaintiffs made two varieties of linseys, and their goods were known not only as Stillman & Co.'s linseys, but as Stillman linseys, and had kept up the reputation of the goods.And it is further alleged that the defendants(whose firm, consisting of Robert F. Latimer, James Stillman, and Alexander Jaffrey, was formed August, 1874) had begun in July, 1876, and were continuing to make linseys - some like plaintiffs' and some inferior, and with a fraudulent design to injure the plaintiffs and the public, and knowingly and wrongfully, either with intent to defraud, or without such intent, put upon them a label or trade-mark, in imitation of that of the plaintiffs', whereby the public are liable to be, and are, deceived, and the plaintiffs deprived of great profit, & c.

A suit at law was commenced in August, 1876, and the bill containing the foregoing allegations was filed August 11, 1876.An injunction having been granted until the hearing, a motion for preliminary injunction was heard before Matteson, J., and by him refused, and the matter has now been argued at great length before the full court.

It appears, from the affidavits and papers filed, that, in 1841, Jonathan P. and Amos Stillman bought of O. M. Stillman the mill at Westerly, or Pawcatuck Bridge (but on the Stonington side of the river), and, in 1843, fitted up a part of it for manufacturing linseys, and that they continued the manufacture of them there, under various changes of firm, until 1873.Part of the time Jonathan and Amos were alone; they subsequently took in Thomas V., son of Jonathan, and Albert Stillman.After the fire, in 1860, the mill was rebuilt, and the old firm took in Welcome Stillman, under the style of Stillman & Co.On the death of Welcome, in 1864, his son, George G., came in.On the death of Albert, in 1871, his interest was bought by some of the partners, and the firm so remained until November 10, 1871, when it was dissolved, and the old members (excepting George), together with Berry and Stanton, formed a new firm, by the name of Stillman, Stanton & Co., which continued until December 5, 1872.In June, 1874, Berry and Stanton foreclosed a mortgage they held on the mill, and, taking possession, leased it to the defendants, or one of them, who had formed a firm for manufacturing about that time.

The plaintiffs' firm was formed in 1873.Carmichel had been superintendent of the mill for Stillman & Co., and was also with Stillman, Stanton & Co. until they stopped.

Have the complainants such a title to the label or design which they use on their goods as to prevent others from using it, and, if so, have the defendants violated this right by using it, or one so similar that a court of equity ought to interfere?

The complainants claim it on three grounds: -

First .From Carmichel having formerly been a partner with Stillman & Co.

We cannot find, upon the facts as stated by the complainants, that he was ever a partner in the old concern.His name does not appear in the notice of dissolution.He received a portion of the profits as compensation for superintendence.And, furthermore, if he was a partner, upon the dissolution of that firm, in November, 1871, the right to this trade-mark, if of any value, was sold out to another person, viz., George G. Stillman.

Second .That he purchased the right to use it from George G. Stillman, one of the old firm, who had bought it on the dissolution.

Third .By prior user.The complainants rest their claim on their right to use the word " Stillman" prominently on their labels, and also claim that the general effect of the defendants' labels, design, colors, & c., is to deceive and to induce purchasers to believe that they are buying the goods manufactured by the plaintiffs.

Trade-marks were classified by Lord Romilly, M. R., into personal and local.Mr. Tudor (Leading Cases, 2d ed. vol. ii. *573) suggests, as additional classes: third, symbolical, as figures of animals, & c.; fourth, where a fancy name is used; and fifth, where the claim is to a trade-mark compounded more or less of the others.In the old actions at law the remedy was chiefly on the ground of fraud.See a review of them in Motley v. Downman, 3 M. & C. 1.See alsoCrawshay v. Thompson etals.4 M. & G. 357; also American note to last case 43 Eng. Com.LawRep. 204;Southern v. How, Popham, 143;3 Cro. Jac. 468.But as that remedy is now seldom resorted to, we need only inquire into the grounds on which courts of equity exercise jurisdiction.In some of the early cases, it was rested on the ground of fraud.In some later cases, partly on that ground and partly on the ground that it was to be treated as a species of property.In the case of The Collins Co. v. Brown, 3 Kay & J. 423, which was a case of edge tools, Page-Wood, v. C., says (page 426): " It is now settled law, that there is no property whatever in a trade-mark; but that a person may acquire a right of using a particular mark for articles which he has manufactured, so that he may be able to prevent any other person from using it, because the mark denotes that articles so marked were manufactured by a certain person."And (page 431), " No person can acquire property in a trade-mark."But no one has a right to use it to deceive.

Subsequently, in the case of Hall v. Barrows, Lord Romilly, M. R.(A. D.1863, 11 W. R. 525), held that it rested on the ground of property; and Lord Westbury, L. C., in the same case (12 W. R. 322;4 De G., J. &S. 150), put it on the same ground, arguing that fraud on the public was no reason for relief unless it caused damage to the plaintiff, and that the defendants were liable to be enjoined in many cases where no fraud was intended.This was a case of a very old partnership which had been changed several times, so that the trade-mark, consisting of the initial letters of the names of the original partners, did not represent the names of the present firm, and the dispute was between persons claiming under the firm; when examined, we find it merely decides that a trade-mark, consisting of a name, may be sold with the works in such a manner as to prevent a surviving partner from using it, and the court expressly say that they do not mean to decide that it could be sold separately from the works.

The recent case of The Singer Manufacturing Co. v. Wilson, decided in August, 1876, by the Lords of the Court of Appeal in England (24 W. R. 1023), contains a full discussion of this question, and qualifies very materially the doctrine of property in a name or mark.

The plaintiffs in that case claimed that, while they had patents for parts of their machinery, they never had a patent particularly descriptive of any one machine; that the name did not imply any specific principle of construction, but merely designated the machines made by the plaintiffs; and that they had acquired a great reputation by reason of their excellence and durability; that the defendants, under that name, manufactured and sold inferior machines, to the injury of the reputation of the plaintiffs.

The defendants denied that the...