Luckett v. Orange Julep Co.

• Decision Date: 30 June 1917
• Citation: 196 S.W. 740,271 Mo. 289
• Parties: A. M. LUCKETT, Doing Business as SOUTHERN FRUIT JULEP COMPANY, and JERSEY COMPANY, Appellants, v. ORANGE JULEP COMPANY, a Corporation, and CLAUD JOHNSTONE et al., Partners, Doing Business Under Firm Name of ORANGE JULEP COMPANY
• Court: Missouri Supreme Court

196 S.W. 740

271 Mo. 289

A. M. LUCKETT, Doing Business as SOUTHERN FRUIT JULEP COMPANY, and JERSEY COMPANY, Appellants, v. ORANGE JULEP COMPANY, a Corporation, and CLAUD JOHNSTONE et al., Partners, Doing Business Under Firm Name of ORANGE JULEP COMPANY

Supreme Court of Missouri

June 30, 1917

Appeal from St. Louis City Circuit Court. -- Hon. Leo S. Rassieur Judge.

Reversed and remanded (with directions).

Frumberg & Russell and Brownrigg & Mason for appellants.

(1) Where a person is employed by a company which uses a secret process in the manufacture of its product, there is an implied contract on the part of the employee not to divulge the secret or use it for his own purposes, after he leaves the company. Pape v. Lathrop, 18 Ind.App. 643; Little v. Gallus, 38 N.Y.S. 489; Kodak Co. v Reichenbach, 79 Hun, 183; O. & W. Thum Co. v Tloczynski, 114 Mich. 149; Peabody v. Norfolk, 98 Mass. 452; Westervelt v. Paper Co., 154 Ind. 673; Stone v. Chemical Co., 65 N.J.Eq. 759; Silver Springs B. & D. Co. v. Woolworth, 16 R.I. 732; Trice v. Comstock, 121 F. 620; Detinning Co. v. Can Co., 12 L. R. A. (N. S.) 102; Baldwin v. Von Micheroux, 25 N.Y.S. 857; Glass Co. v. Schnebach, 239 Pa. 76; Wiggins Co. v. Cot-A-Lap Co., 169 F. 150; Switch & Signal Co. v. Sperry, 169 F. 26. (2) Furthermore, even if during his employment he had discovered the secret of this compound, entirely by his own efforts, unaided by any other employee, but with his master's time, material and appliances, then, inasmuch as he allowed the master to advertise this product under the name of "Howel's Orange Julep," to advertise it throughout the United States to the extent of thousands of dollars, and build up a business to the extent of more than $ 100,000 a year, based upon that formula, by every principle of equity and fairness he would be now estopped to claim the sole proprietorship of that formula, or to claim that he had a right to go out and use it to his former master's injury. Pape v. Lathrop, 18 Ind.App. 643; Little v. Gallus, 38 N.Y.S. 489; Kodak Co. v. Reichenbach, 79 Hun, 183; Silver Springs B. & D. Co. v. Woolworth, 16 R.I. 732; Baldwin v. Von Micheroux, 25 N.Y.S. 857. (3) The owner of such a secret process, though not patented or patentable, has a right to protection by injunction against one who, in violation of a contract or breach of confidence, undertakes to apply the secret to his own use, or impart it to others. Stewart v. Hook, 18 Ga. 445; O. & W. Thum Co. v. Tloczynski, 114 Mich. 149; Nut Co. v. Cramer, 134 Mich. 370; Taylor v. Iron & Steel Co., 70 N.J.Eq. 541; Harvey Co. v. Drug Co., 75 A.D. 108. (4) Whether a trade name is capable of exclusive appropriation as a technical trade-mark, or not, and even though it be descriptive, if it has a secondary meaning as a designation of the product of a certain person, others have no right to use that name without some accompanying statement to clearly distinguish the competing product from the product originally put out under the name used. Watch Co. v. Sanborn, 96 F. 330; Oxford University v. Publishing Co., 101 F. 443; Devlin v. Peek, 135 F. 167; Draper v. Scarritt, 116 F. 206; Globe-Wernicke Co. v. Brown, 121 F. 185; Knitting Co. v. Garon, 128 N.W. 288; Levy v. Walker, L. R. 10 Ch. D. 447. (5) In order to make out his case, it is not necessary for the plaintiff in a case like the one at bar to prove actual deception of the public, where a manifest likelihood of such deception exists. Fuller v. Huff, 43 C. C. A. 453, 104 F. 141; Pin Co. v. Berg Bros., 188 F. 683; Von Mumm v. Frasch, 56 F. 837; Malting Co. v. Malting Co., 97 N.W. 389. (6) In such a case as this, even though the defendants practiced no deception themselves, if the trade name adopted by them was such as to enable middlemen and to lead middlemen to deceive the public into believing that the defendants' product is the plaintiff's product, there is a violation of plaintiff's rights. Johnston v. Orr-Ewing, 7 App. Cas. 231; R. Hennisch's Sons Co. v. Boker, 86 F. 768; Gulden v. Chance, 182 F. 318; Von Mumm v. Frasch, 56 F. 835; Mfg. Co. v. Trainer, 101 U.S. 51; Nims, Unfair Competition. p. 32, sec. 18; Tobacco Co. v. Hynes, 20 F. 884; McLean v. Fleming, 96 U.S. 255; Fairbank Co. v. Mfg. Co., 77 F. 877.

Bruce S. Elliott and Wagner & Miller for respondents.

(1) As to the claim that defendants have been guilty of unfair competition in giving their product the same color as that of the plaintiffs' products, plaintiffs have no monopoly in any particular color, and certainly have no monopoly to give an orange syrup an orange color. Plaintiffs adopted no particular color as a distinguishing mark of their goods; and where defendants use the same color for their product as plaintiffs use, it must be shown that this was done with the design to market their goods as those of plaintiffs. Enoch Morgens' Sons Co. v. Whittier-Coburn Co., 118 F. 657; Fairbank Co. v. Mfg. Co., 75 F. 869; Dennison Mfg. Co. v. Mfg. Co., 94 F. 651; Tobacco Co. v. Larus & Bro., 133 F. 727; Marvel Co. v. Pearl, 133 Fed 160; Remedy Co. v. Eureka Co., 80 F. 105; Von Mumm v. Whitteman, 85 F. 966, 91 F. 126. (2) The formula under which "Orange Julep" is being made by defendants was not obtained from plaintiffs and was never peculiarly their property. (a) If, on the one hand, defendant Johnstone originated and owned this formula, his conduct in permitting plaintiffs to use it in the manufacture and marketing of their syrup simply gives them the right to continue to do so; but he would have an equal right with plaintiffs to manufacture and market the syrup made from his own formula, the only limitation to that right being that he must distinguish his goods from those of plaintiffs. (b) If, on the other hand, Johnstone and Howel collaborated in producing the formula, it must affirmatively appear that the information conveyed to Johnstone by Howel in the matter was not such as Johnstone would or could have acquired in the ordinary practice of his profession, before he can be enjoined from its use. Nims, Unfair Competition, p. 432; Iron & Steel Co. v. Nichols, 69 A. 186; Alger v. Thatcher, 19 Pick. 51; Albright v. Teas, 37 N.J.Eq. 171; Stein v. National Life Assn., 105 Ga. 821, 46 L. R. A. 150; High on Injunctions, par. 19. (3) There is no evidence that defendants are using the same formula as that used by plaintiffs, or that their product is the same product as that made by plaintiffs; and the court, therefore, has no means of knowing that they are the same. On the contrary, Johnstone swears that the "Orange Julep" now manufactured by defendants is the same product that he had made originally before his employment by plaintiffs and is the same product that he made while with the plaintiffs, and that he has never disclosed the formula for making that product to any one. Wherefore, the court is manifestly unable to say that the two formulae and the products therefrom are now the same. Baglin v. The Cusinier Co., 164 F. 25. (4) The words "Orange Julep," being a common name, descriptive, and incapable of exclusive appropriation, the defendants, in common with the public generally, have a right to use the words to describe their product, if in so doing they practice no deception. Descriptive terms and generic names are publici juris and incapable of exclusive appropriation by any one; and even where the words have acquired a secondary meaning the subsequent users (as these defendants) have no other burden imposed upon them than to use the name (as was done in this case) in such manner as to prevent the possibility of deceiving purchasers. If, by reason of such allowable use by defendants, plaintiffs suffer any injury it is damnum absque injuria. 38 Cyc. 769; Varnish Works v. Fisher, 153 F. 928; Stationery Co. v. Dodge, 145 Cal. 380; Kroph v. Furst, 94 F. 150; Hot Springs Co. v. Hegeman, 138 F. 855; Nicholson v. Cigar Co., 158 Mo. 158; Oakes v. Candy Co., 146 Mo. 391; McCartney v. Garnhart, 45 Mo. 593; Seed Co. v. Plant Co., 37 Mo.App. 313; Wrisley Co. v. Soap Co., 122 F. 796; Reach Co. v. Hardware Co., 155 Mo.App. 412; Alden v. Gross, 25 Mo.App. 123. (5) The fact (if it be a fact) that defendants' "Orange Julep" could be sold to ultimate consumers at the soda fountain as or for plaintiffs' product, thereby injuring the plaintiffs, constitutes no ground whatever for interference with defendants' sale of their product; provided, that defendants have fully met the duty imposed upon them by law (as they clearly have in this case) of so labeling the immediate containers of their product that they in no manner simulate the packages or containers of plaintiffs' product. Rathbone v. Champion Co., 189 F. 26, 110 C. C. A. 596, 37 L. R. A. (N. S.) 354. (6) It is an absolute essential, in order to establish a case of unfair competition, that the court should find that the ordinary purchaser would be deceived into purchasing defendants' goods, believing that he was purchasing those of the plaintiffs. Scrivener v. North, 134 F. 366-80, 67 C. C. A. 348; Simmons Co. v. Drug Co., 93 Tenn. 84; Washboard Co. v. Saginaw Co., 103 F. 281; Vitascope v. Phonograph Co., 83 F. 30; Proctor & Gamble Co. v. Refining Co., 92 F. 357; Centaur Co. v. Marshall, 97 F. 785, 38 C. C. A. 413; Heinz v. Lutz, 146 Pa. St. 608; Pfeiffer v. Wilde, 107 F. 456, 102 F. 658; Fisher v. Blank, 138 N.Y. 452; Coates v. Thread Co., 149 U.S. 526; McDonald v. Mueller Co., 183 F. 972; Type Foundry Co. v. Portland Co., 186 F. 690; Hilker Mfg. Co. v. Map Co., 191 F. 613.

RAILEY, C. Brown, C., concurs. Graves, C. J., and Walker, Faris and Woodson, JJ., concur; Bond, Blair and Williams, JJ., dissent.

OPINION

In Banc.

RAILEY C.

On November 19, 1913, appellants filed in the circuit court of the city of St. Louis, their petition in equity to restrain defendants,...