Federal Trade Commission v. Klesner

• Decision Date: 02 April 1928
• Docket Number: No. 976.,976.
• Citation: 25 F.2d 524
• Parties: FEDERAL TRADE COMMISSION v. KLESNER.
• Court: U.S. Court of Appeals — District of Columbia Circuit

25 F.2d 524 (1928)

FEDERAL TRADE COMMISSION v. KLESNER.

No. 976.

Court of Appeals of District of Columbia.

Submitted March 5, 1928.

Decided April 2, 1928.

A. F. Busick and R. P. Whiteley, both of Washington, D. C., for petitioner.

H. S. Barger and C. R. Ahalt, both of Washington, D. C., for respondent.

Before MARTIN, Chief Justice, and ROBB and VAN ORSDEL, Associate Justice.

VAN ORSDEL, Associate Justice.

The Federal Trade Commission filed its petition in this court for an injunction to enforce an order of the Commission against respondent Alfred Klesner, requiring him, his servants, agents, and employees, to "cease and desist from using the words `Shade Shop,' standing alone or in conjunction with other words, as an identification of the business conducted by him, in any manner of advertisement, signs, stationery, telephone or business directories, trade lists, or otherwise."

It appears that the Commission, in December, 1920, on the complaint of one W. Stokes Sammons, issued a complaint against defendant, charging him with unfair methods of competition in commerce under the Federal Trade Commission Act. 38 Stat. 717 (15 USCA §§ 41-51). To the complaint, defendant answered, and upon issue joined and evidence adduced the order here sought to be enforced was made by the Commission. The complaint charged the defendant with using the word "Shade Shop" on a window at his place of business, on an automobile truck owned and operated by him, and in the telephone directory for the city of Washington, in such manner as to confuse, mislead, and deceive the general public into the erroneous belief that defendant's place of business was the place where a similar business was conducted by Sammons under the name of "The Shade Shop."

It appears that one H. S. Hooper, since the year 1904, was engaged in the decorating and window shade business, and that in 1909 the firm of Hooper & Klesner was formed, which succeeded to the business of Hooper. It further appears that in 1919 defendant purchased Hooper's interest in the business and has conducted it under the firm name of Hooper & Klesner; that he never did business under any other name, and never stamped his shade goods with the name "The Shade Shop" or "Shade Shop"; that he has not used "Shade Shop" on his stationery, or in advertisements, or on signs, or otherwise, except in conjunction with the firm name of Hooper & Klesner.

Considerable evidence was adduced showing the competitive character of the business between defendant and Sammons, and establishing some confusion in trade by customers going to defendant's shop, when they were in fact intending to do business with Sammons. We think, however, that the case can be disposed of without an analysis of the testimony, since it clearly appears and is conceded that the use was limited, as charged in the complaint, to a sign or signs painted on his place of business, on an automobile used in connection with his business, and to a notice appearing in the classified business section of the telephone directory of the city of Washington. In each instance the name was used in connection with the firm name Hooper & Klesner.

This action is sought to be sustained under section 5 of the Federal Trade Commission Act (15 USCA § 45), which, among other things, provides "that unfair methods of competition in commerce are hereby declared unlawful. The Commission is hereby empowered and directed to prevent persons, partnerships, or corporations, except banks, and common carriers subject to the acts to regulate commerce, from using unfair methods of competition in commerce. Whenever the Commission shall have reason to believe that any such person, partnership, or corporation has been or is using any unfair method of competition in commerce, and if it shall appear to the Commission that a proceeding by it in respect thereof would be to the interest of the public, it shall issue and serve upon such person, partnership, or corporation a complaint stating its charges in that respect, and containing a notice of a hearing upon a day and at a place therein fixed at least thirty days after the service of said complaint."

The act then provides for the appearance of the party charged with unfair conduct, his right to be heard, and for the reduction of the testimony to writing, and the filing of a copy thereof in the office of the Commission, and, in the event that the Commission finds that unfair methods have been employed, an order shall issue against the party charged, requiring him to "cease and desist from using such method of competition."

In the present case it will be observed that the term "Shade Shop", as used by defendant, is merely descriptive of the trade or business conducted by the defendant, and is indicative of a place where window shades are made and sold. In other words, it is a generic name of a place where business of that sort is conducted. It is well settled that the exclusive use to such a name, either as a trade-mark or trade-name, is not entitled to legal protection. In Delaware & Hudson Canal Co. v. Clark, 13 Wall. 311, 20 L. Ed. 581, the plaintiff had for many years adopted and used "Lackawanna Coal" as a trade-name for his product, and he sought to restrain the defendant from applying the same name to coal produced in the same vicinity. Mr. Justice Strong,...