Erick Bowman Remedy Co. v. Jensen Salsbery Laboratories

• Decision Date: 27 December 1926
• Docket Number: No. 7364.,7364.
• Citation: 17 F.2d 255
• Parties: ERICK BOWMAN REMEDY CO., Inc., v. JENSEN SALSBERY LABORATORIES, Inc.
• Court: U.S. Court of Appeals — Eighth Circuit

17 F.2d 255 (1926)

ERICK BOWMAN REMEDY CO., Inc., v. JENSEN SALSBERY LABORATORIES, Inc.

No. 7364.

Circuit Court of Appeals, Eighth Circuit.

December 27, 1926.

John Ott, of Minneapolis, Minn. (T. A. Kingland, of Owatonna, Minn., and F. W. Murphy, of Wheaton, Minn., on the brief), for plaintiff in error.

I. N. Watson, of Kansas City, Mo. (M. B. Webber, of Winona, Minn., on the brief), for defendant in error.

Before VAN VALKENBURGH, Circuit Judge, and PHILLIPS, District Judge.

PHILLIPS, District Judge.

The Erick Bowman Remedy Company, Inc., brought this action against the Jensen Salsbery Laboratories, Inc., to recover damages for alleged libel.

After alleging the jurisdictional facts, the complaint proceeds as follows:

"(3) That during all the times stated in this complaint and since the fall of 1921, this plaintiff has been engaged and is still engaged in the manufacture and sale to the general public of a preparation and medicine called and known as the Erick Bowman Abortion Remedy to relieve or cure contagious abortion in cows and sows.

"(4) That the business of this plaintiff as such manufacturer and seller of said remedy has always depended largely on the good reputation and credit of this plaintiff, and upon its honesty and fair dealing with its customers and the general public and upon the trust and confidence reposed in it by its customers and the general public.

"(5) That, prior to the published article hereinafter set forth, the plaintiff by honest dealing, hard work, and much expense had built up a good business in the sale of said remedy in the state of Minnesota and a good interstate commerce business in the sale of said remedy among the several states of the United States and especially in the states of the West, Northwest and Middle West, and the plaintiff had built up a good business reputation and credit."

The complaint then alleges that the defendant is engaged in the manufacture and sale of live stock remedies; that it is a competitor of the plaintiff; that it publishes and distributes to veterinarians and persons interested in raising cattle, hogs, and live stock in the several states of the United States, a publication known as the Jen-Sal Journal; that such publication is widely circulated and distributed in the West, Northwest and Middle West; that it was and is distributed through the mails and otherwise to the customers and prospective customers of plaintiff. The complaint then proceeds as follows:

"(8) That the defendant well knowing all the foregoing facts and with the deliberate purpose and malicious intent to injure the plaintiff in its good name and in its business and business reputation and credit, in the issue of the said the Jen-Sal Journal of July, 1923, composed or caused to be composed and published on page 22 of said publication, of and concerning this plaintiff, the following false and defamatory matter, to wit:

"`Bowman's Abortion Remedy.

"`The North Dakota Agricultural College submitted the following analysis of a sample of Bowman's Abortion Remedy:

                  Ash per cent .........................     1.64
                  Moisture (as received) % .............     4.55
                  Sucrose (by clerget) % ...............    72.83
                  Polarization direct ..................  Plus 72
                  Polarization invert .................. Minus 24
                  Reducing sugar before inversion % ....     5.42
                  Reducing sugar after inversion % .....    81.20
                  Sucrose (by copper) % ................    71.99
                  Total sugar (by copper) ..............    77.41
                  Residue soluble in water % ...........     7.65
                  Residue insoluble in water % .........     9.55
                

"`Sample is brown sugar and bran.

"`By State Food Commissioner and Chemist.

"`This analysis corresponds in all respects to the analysis of samples of this product sent to our laboratory, which only gcoes to prove that P. T. Barnum's statement 50 years ago can be applied even at the present time.

"`We understand that the Farm Bureau of North Dakota is going to put on a publicity campaign to protect the live stock owners against expenditures for such products. This is one piece of work that the Farm Bureau can handle in an effective way.' "(9) That by the publication of said words and article, the defendant intended to assert and to be understood as asserting and by the readers of said journal and publication was in fact understood as asserting that the said remedy manufactured and sold by this plaintiff was worthless, and would not cure the disease of abortion among cows and sows, and that the said remedy was a fraud and a humbug, and that this plaintiff was knowingly engaged in the business of cheating and defrauding the public and all persons who bought said remedy for the purpose for which it was manufactured and sold, and that the Farm Bureau of North Dakota was going to engage in a publicity campaign to expose said fraud and to protect live stock owners against buying such worthless products as plaintiff was manufacturing and selling, and by so doing the said Farm Bureau would be doing a good service to all those who might be victimized by buying plaintiff's said remedy."

The complaint then alleges that the formula for Bowman's Abortion Remedy is a secret formula known alone to plaintiff, and that it has always been very successful in curing cows and sows of the disease of abortion, when used according to plaintiff's instructions. The complaint then alleges damages, as follows:

"(11) That the said article published by the defendant is misleading, false, defamatory and malicious, and by means of said publication the plaintiff has been greatly injured in its good name and business reputation, and has suffered great loss in its business and credit, and has been deprived of great gains and profits which otherwise it would have made, and by reason of said facts the plaintiff has suffered damages in the sum of one hundred thousand dollars ($100,000.00), no part of which has been paid."

The defendant duly appeared and filed its answer.

The cause came on for trial, and a jury was duly impaneled and sworn to try the cause. Following the opening statement of counsel for the plaintiff, defendant, through its counsel, moved the court to dismiss the cause on the ground that neither the complaint nor the statement of counsel stated any cause of action against the defendant. This motion was granted, and the cause dismissed. From the judgment of dismissal, this writ of error was sued out.

The trial court assigned as its reason for dismissing the cause that the article was not libelous per se and special damages were not alleged.

The contentions of counsel for plaintiff are, first, that the publication was libelous per se; and, second, that the allegation of damages was sufficient, even if the article was not libelous per se.

The first question presented is: Was the publication libelous per se?

A corporation has no reputation in the sense that an individual has. Memphis T. Co. v. Cumberland T. & T. Co. (C. C. A. 6) 145 F. 904, 906; Security Benefit Ass'n v. Daily News Pub. Co. (C. C. A. 8) 299 F. 445; Vitagraph Co. of America v. Ford (D. C.) 241 F. 681, 683; Reporters' Ass'n of America v. Sun Print. & Pub. Ass'n, 186 N. Y. 437, 79 N. E. 710. It is only in respect to its credit, property, or business that a corporation can be injured by a false publication. Memphis T. Co. v. Cumberland T. & T. Co., supra; Security Benefit Ass'n v. Daily News Pub. Co., supra; Farbenfabriken of Elberfeld Co. v. Beringer (C. C. A. 3) 158 F. 802, 804; Axton-Fisher Tobacco Co. v. Evening Post, 169 Ky. 64, 183 S. W. 269, 274, L. R. A. 1916E, 667, Ann. Cas. 1918B, 560; People's U. S. Bank v. Goodwin, 167 Mo. App. 211, 149 S. W. 1148, 1150; Adirondack Record, Inc., v. Lawrence, 202 App. Div. 251, 195 N. Y. S. 627, 629, 630; Kemble & Mills of Pittsburgh v. Kaighn, 131 App. Div. 63, 115 N. Y. S. 809, 811, 812.

In Fry v. McCord et al., 95 Tenn. 678, 33 S. W. 568, the court said:

"It has been held that, in order to constitute language libelous per se, it must be `either such as necessarily, in fact, or by presumption of evidence, occasions damage to him of whom or whose affairs it is spoken.' Townsh. Sland. & L. (4th Ed.) § 146; Newell, Defam. p. 181, § 14. `Such language confers a prima facie right of action, and is prima facie a wrong, and injurious per se; and the law will presume damage, without proof, merely from implication or presumption from the publication.' Townsh. Sland. & L. (4th Ed.) § 147. `Language which, however, does not, as a necessary consequence, occasion damage to the party published, is not per se libelous, and in such cases a right of action exists only when, as a necessary and proximate consequence of the publication, special damage ensued to the party published.' Id. §§ 146-148; Bank v. Bowdre, 92 Tenn. 736, 23 S. W. 131. We think a statement in substance and effect the same, but in different language, is that words which upon their face, and without the aid of extrinsic proof, are injurious, are libelous per se; but if the injurious character of the words appear, not from their face, in their usual and natural signification, but only in consequence of extrinsic circumstances, they are not libelous per se."

The Circuit Court of Appeals for the Sixth Circuit, in Memphis T. Co. v. Cumberland T. & T. Co., supra, quotes with approval the definition of a publication libelous per se given in Fry v. McCord, supra.

In order for a publication to be libelous per se as against a corporation, it must appear, from the publication itself and without the aid of extrinsic evidence, that the words complained of will directly injure the credit, property or business of the corporation and result in pecuniary loss. Security Benefit Ass'n v. Daily News, supra; Vitagraph Co. of America v. Ford, supra; Den Norske Amer. Actiesselskabet v. Sun Print. & Pub. Ass'n, 226 N. Y. 1, 122 N. E. 463, 464; 36 C. J. p. 1150, § 17.

Where the words are not actionable per se, it is necessary to plead by...