Eureka Fire Hose Co. v. Eureka Rubber Mfg. Co.

• Decision Date: 12 April 1905
• Citation: 60 A. 561,69 N.J.E. 159
• Parties: EUREKA FIRE HOSE CO. v. EUREKA RUBBER MFG. CO.
• Court: New Jersey Court of Chancery

60 A. 561

69 N.J.E. 159

EUREKA FIRE HOSE CO.

v. EUREKA RUBBER MFG. CO.

Court of Chancery of New Jersey.

April 12, 1905.

Suit by the Eureka Fire Hose Company against the Eureka Rubber Manufacturing Company. On bill, amended bill, answers, replication, and proofs. Decree ordered.

Complainant is a corporation of this state, incorporated December 25, 1800, under the name of "Eureka Fire Hose Company"; and the defendant is also a corporation of this state, organized July 15, 1902, under the name of the "Eureka Rubber Manufacturing Company." The principal manufactures of the complainant are fire and other hose, two-thirds of its business being in a rubber-lined cotton fire hose; and a considerable part of defendant's sales, 7 per cent. or more, are of hose of the same general character. Complainant is the successor of a company incorporated in the state of New York in 1875, "to manufacture fire hose and other knit and woven fabrics," which carried on the business of manufacturing the rubber-lined hose from that time until the complainant was incorporated in this state (where its factory was located), mainly for the purpose of taking over the property and business of the New York corporation. Complainant claims that at the time of defendant's incorporation the hose and goods manufactured by it had become known in the trade and to the public as the "Eureka" hose or goods, and that it was entitled to the exclusive use of this name as applied to these articles. The use by the defendant of the name "Eureka" with reference to the same class of goods, which it is putting on the market, is alleged to be a violation of complainant's exclusive rights to the name or word. The complainant also claims that the goods manufactured by its predecessor and itself, and always put upon the market under the name "Eureka," were of a high grade or standard, and the name came to indicate this high grade, and that the use by the defendant of the name "Eureka" in connection with the advertisement and marketing of its goods is an attempt to market their goods upon the reputation of complainant's goods, and is done in unfair competition with complainant; that the use of the word "Eureka" by defendant in its corporate title and in advertising and marketing its goods is likely to deceive and has in fact deceived the public, and has led to purchases of defendant's goods, instead of complainant's goods. The complainant also alleges that, because rubber is one of the components principally used by it in its manufacture of hose, the word "Rubber" has from the time of the formation of the New York company been often used by its customers and correspondents as part of its title, in addressing them for orders or upon business; that the defendant company has established an office in New York, where complainant also has an office; and that much confusion has resulted from the use by both companies of the name "Eureka" in reference to the same class of goods. It is also alleged that the use of the name "Eureka" in its corporate title was in contravention of the eighth section of the corporation act (P. L. 1896, p. 280), which provides that "no name shall be assumed already in use by another corporation of this state, or so nearly similar thereto as to lead to uncertainty or confusion." The bill prays an injunction against defendant's using the word "Eureka" in advertising or marketing its wares, especially fire hose, and the use of the name "Eureka" in its title as a corporation or otherwise.

The defendant denies that the complainant's goods had become known in the trade by the name of "Eureka" goods, or that complainant had acquired any exclusive use of this name. It admits that it manufactures and markets rubber-lined cotton fire hose, and other hose, in competition with complainant, but alleges that in advertising and marketing these goods the hose and other articles are not advertised, marketed, or stamped with the single word "Eureka" as a trade mark or name, but that this word is only used in connection with the corporate name, and its place of manufacture. Trenton, N. J., together with the trade-mark or trade-name of the special article, such as "Acme," "Buffalo," "Capital," etc. As to the claim of unfair competition, defendant denies that the use of the word "Eureka" in its corporate title, or in advertising or marketing its goods, is likely to deceive or has deceived the purchasing public, or leads or threatens to lead to a diversion of any of complainant's business to defendant, or that defendant has ever sold its goods as complainant's goods or on their reputation. As to the selection of its name, the defendant alleges that, on application made on its behalf to the office of the Secretary of State, it was informed that the name assumed by it had not been assumed by any other corporation, and that no other name so nearly similar thereto as to lead to uncertainty or confusion had been so assumed, and that thereupon the defendant chose this name.

Complainant alleges that before filing the bill it applied to the defendant to cease the use of the word "Eureka" in competition with it, and defendant admits a request to discontinue the use of the word "Eureka" in the prosecution of defendant's business, and that it declined to accede thereto, and the reason given is that the use of the word "Eureka" in defendant's corporate title and in its advertisements and upon its goods does not lead to any uncertainty or confusion, under the eighth section of the corporation law, and does not constitute unfair trade or competition.

By an amendment to the bill, made at the hearing, the complainant also claims the exclusive right to a distinctive device, consisting of red, white, and blue color parallel lines woven in the fabric, for the purpose of distinguishing certain kinds of hose manufactured by it; that this device has become generally known to the public as indicating "Eureka" goods of a particular kind, and has become identified with "Eureka" hose. The exclusive right to use this device in connection with the trade-name "Eureka" is claimed as a valuable asset. Defendants are charged with simulating this device, by the use of red, white, and blue parallel lines in its catalogues, and in branding and putting up its goods, intending to mislead the public, and that, for the purpose of creating confusion and causing the public to believe that defendant company is identified with complainant, the defendant uses these color lines, and the restraint of this use is sought. The defendant's amended answer, also filed at the hearing, denies any simulation of this color device of complainant, or any use of it violating any rights thereto which complainant may have.

Randolph Perkins, Gilbert Collins, and R. V. Lindabury, for complainant. John V. B. Wicoff and Wm. M. Lanning, for defendant.

EMERY, V. C. (after statement of issues). Four questions for decision are raised by the pleadings and proofs: First. Whether complainant has such an exclusive right to the use of the name or word "Eureka," as applied to the goods of its manufacture, that the use of this name or word by defendant in the marketing of similar goods in competition is an infringement of complainant's right to the use of the word or name on the goods. Second. Whether the use of the name or word "Eureka" by the defendant, in its corporate title or otherwise, in connection with the marketing of the goods in competition with complainant, was unfair or fraudulent competition. Third. Whether the use of the name was a violation of the statute. Fourth. Whether defendant's use of the color lines, either on its goods or in the advertising and marketing of them, should be enjoined, either as a violation of complainant's exclusive right, or as unfair competition.

The facts relating to the first question are not substantially disputed. It is clearly proved by complainant that the goods manufactured by the New York company, and by complainant as its successor, were, at the time of defendant's incorporation, generally known in the trade under the name of "Eureka" goods, and that their goods, especially the "Eureka" fire hose, had a more extensive sale and had acquired a higher reputation than those of any other manufacturer. The fire hose was a rubber-lined cotton fire hose, in which an inside rubber tubing is covered with an outside cotton fabric (either woven or knit); the two being combined by a process of vulcanization. The rubber tubing used was manufactured for complainant to its special order, and delivered in a special condition adapted to its process of vulcanization. The process of combining the tube and cover does not appear to have been patented, but complainant's predecessor claimed to have been the original makers of this combined cotton rubber-lined hose, and in its manufacture it appears to have attained the highest reputation in the home market and also in many foreign markets. At the time of the transfer by the New York company, its entire business in hydraulic hose amounted to over $500,000 a year, about two-thirds of which was the cotton rubber-lined hose; a trade exceeding that of any competitor in these goods. The price of the "Eureka" hose was generally higher than that of other hose, and some of its varieties had been adopted or referred to as the "Standard" hose. Several kinds of hose were made, differing in grade, quality, and purpose of use, and to each of these varieties or brands a second or subsidiary trade-name or trade-mark was given, except to the kind marked with the word "Eureka" alone, which was the best of each class of hose manufactured. In every other case, the second or subsidiary name (usually called "brand" in the trade) was used in connection also with the name "Eureka"—sometimes in the entire name of the brand, as "Eureka Peerless," "Eureka Wove Knit Hose," "Eureka Garden Hose," etc. In some form the name or word "Eureka" appeared on all their goods, and (except...