McCane v. Mims, Patent Appeals No. 5750.

• Decision Date: 06 February 1951
• Docket Number: Patent Appeals No. 5750.
• Citation: 187 F.2d 163
• Parties: McCANE v. MIMS.
• Court: U.S. Court of Customs and Patent Appeals (CCPA)

187 F.2d 163 (1951)

McCANE v. MIMS.

Patent Appeals No. 5750.

United States Court of Customs and Patent Appeals.

February 6, 1951.

Ernest P. Rogers and Smith, Kilpatrick, Cody, Rogers & McClatchey, all of Atlanta, Ga., for appellant.

Henry L. Jennings and Jennings & Carter, all of Birmingham, Ala., for appellee.

Before GARRETT, Chief Judge, and JACKSON, O'CONNELL, JOHNSON, and WORLEY, Associate Judges.

GARRETT, Chief Judge.

This is an appeal from the decision of the Commissioner of Patents, speaking through the Assistant Commissioner, 80 U.S.P.Q. 104, affirming the decision of the Examiner of Interferences in a trade-mark interference proceeding, which originated in the United States Patent Office.

The interference was declared October 28, 1946, between the registration "Lucky-Seven," Trade-Mark 389,456, in the name of "T. A. McCane, doing business as Queen Ann Company, Atlanta, Georgia," certificate of which issued August 5, 1941, on an application, serial No. 441,516, filed March 13, 1941, and an application, serial No. 483,025, filed May 5, 1945, by appellee Mims, "doing business as Astoria Products Company," of Birmingham, Alabama, for registration of the same mark.

In the registration certificate use of "Lucky-Seven" as a trade-mark for "Hair Dressing or Pomade, Talcum Powder, Skin Bleach, Body Deodorant, Face Powder, Vanishing Cream, and Perfume" since March 1, 1932, was stated. The application of Mims alleged continuous use of the words "Lucky Seven" (not hyphenated) as a trade-mark for "Sachet Powder, Toilet Water, Deodorant, Pressing Oil, Talcum Powder, Perfume, and Hair Dressing" since January 1930. As hereinafter related, Mims purchased a business from McCane in February 1932, and he seems to have claimed the date on which he understood McCane began use of the mark.

Both the registration and the application were under the Trade-Mark Act of 1905, and the Lanham Act of 1946, 15 U.S.C.A. § 1051 et seq., is not here involved.

It is established by the record that during some two or three years prior to 1932 the party McCane was egaged, at Birmingham, Alabama, in the manufacture and sale of cosmetics such as those defined in the registered mark and in the application here involved, including perfume and hair dressing, which were sold in receptacles having thereon labels bearing the notation "Lucky Seven," which notation, however, was not registered then in the United States Patent Office as a trade-mark. The party McCane carried on his business with respect to all his cosmetic products under the name "Astoria Company," which itself was not registered as a trade-mark, and he appears to have used other unregistered notations, such as "Yellow Jasmin," "White Rose," etc. upon some of the perfumes and other products manufactured and sold by him.

It does not appear that McCane had any registered trade-marks while doing business in Birmingham.

As stated in the brief before us on behalf of the party McCane: "* * * While sales were made by mail and otherwise in commerce, a substantial portion of the business consisted of the sale of these products through `peddlers,' who purchased small quantities and resold them from house to house in and near Birmingham. For several weeks prior to February, 1932, the party Mims, apparently contemplating purchase of all or a part of the business, spent considerable time at the place of business and became familiar with its operation."

It is claimed by the party Mims that in February 1932 he purchased from the party McCane the entire business which McCane was carrying on as the Astoria Company, including all the cosmetic products, formulæ, and other assets, together with the marks and names in use and the good will of the business, and it is conceded on the part of the party McCane that such a sale was made, except it is claimed that McCane expressly reserved all rights to the perfume and the hair dressing, the only products to which the notation "Lucky Seven" was being applied, and to the notation itself as a trade-mark in use although not registered.

The primary question for determination, therefore, is one of fact — that is, just what was included in the sale from McCane to Mims, or, to state it differently, does the record show that Mims by the purchase acquired ownership of the mark "Lucky Seven"?

The record upon which that question must be decided is meager and in some respects quite indefinite.

It is asserted on behalf of both parties that the contract of sale made by McCane to Mims was reduced to writing, but neither party was able to produce the written instrument. Mims, testifying on his own behalf, and J. Thornton McCane, testifying on behalf of his brother, the appellant here, gave certain testimony as to the contents of the instrument. This we hereinafter discuss.

It appears that soon after the transaction between Mims and McCane in February 1932 the former changed the name "Astoria Company" to "Astoria Products Company" and carried on the business in Birmingham, continuing use of the unregistered notation "Lucky Seven" on perfume and hair dressings theretofore manufactured by McCane and later applied the notation to other cosmetic products. (The word "Astoria" was first registered to Mims "doing business as Astoria Products Company," December 24, 1946, upon an application filed May 12, 1945. That registration is not involved in the instant controversy. It is noted that it covered numerous drugs in addition to cosmetics, and that it states use "since January 1932.")

It further appears that almost immediately after the sale to Mims (Mrs. McCane, wife of appellant, testified it was during the last week in February 1932) McCane moved to Atlanta, Georgia, and started a cosmetic business there, carrying it on under the name "Queen Ann Company." Except as stated in the certificate of the registration here involved, the record does not disclose just what types of cosmetics the Queen Ann Company manufactured and sold other than hair dressing and perfume marked "Lucky-Seven," which Astoria Company had been making and selling in Birmingham.

An unhappy phase of the case is that appellant McCane was mentally ill during the trial of this controversy below and was unable to testify.

According to the testimony given by his wife on April 15, 1947, he had been ill since 1936, had not worked for ten years, and had been incapacitated for eight years. When asked during cross-examination as to his condition at the time the application for registration of "Lucky-Seven" was filed on March 13, 1941, she replied: "He was ill at that time, but could take care of some of the things. It was very limited. There was very little at that time going on. He could sign his name."

Mrs. McCane testified that her husband had been adjudged insane, but did not give the date of such judgment. She stated that she was his guardian and had carried on the business after he became incapacitated; that before that time, in fact immediately after establishing the business in Atlanta, advertising began for agents and distributors of the "Lucky-Seven" products, which the Queen Ann Company was making and selling in Atlanta; that she never met Mr. Mims personally; that she never saw the contract of sale between her husband and him; that she had no knowledge prior to this interference proceeding that either Mr. Mims or the Astoria Company was using the notation "Lucky Seven"; and that (she thought in October 1946) she was notified "in a letter received from the Government that he had asked for a copyright of the name `Lucky Seven'." It is a fair assumption that the letter she referred to related to the interference proceeding here involved, which, as has been stated, was declared October 28, 1946.

Before discussing the evidence further it seems appropriate to quote from the decision of the Assistant Commissioner the following: "The burden of proof of establishing that he acquired the rights of McCane in the mark `Lucky Seven' rests upon Mims, the junior party, Brewster-Ideal Chocolate Co. v. Dairy Maid Confectionery Co., 62 F.2d 844, 20 C.C.P.A., Patents, 848; B. R. Baker Company v. Lebow Brothers, 150 F.2d 580, 32 C.C.P.A., Patents, 1206. In support of this burden Mims has not only testified as to the transfer of The Astoria Company, which with the exception of the claim as to reservation of rights to the mark `Lucky Seven' is conceded, but has testified as to the contents of the sales agreement and produced certain pencil notes with respect thereto, an inventory, and certain other exhibits. His testimony as to the agreement is not only confused, but is considered to be incompetent and the notes and other material referred to are entirely lacking in probative force even if properly identified. Without reviewing this purported evidence, I considered all material introduced by Mims as showing the contents of the written agreement as incompetent and as lacking any probative force as to the contents of this agreement." (Italics supplied.)

It will be observed that notwithstanding the obviously correct holding that the burden of establishing acquisition of the rights claimed in the mark "Lucky Seven" rested upon the party Mims as the junior party, the Assistant Commissioner rejected out-rightly the entire testimony of Mims relating to the agreement as being "confused" and "incompetent" and also all the material introduced as showing the contents of the contract as "incompetent" and "lacking any probative force," but nevertheless decided the case in Mims' favor.

We find no direct testimony, or other direct evidence, in the record which supports the contention of Mims as to what was in the agreement respecting what was sold to him, except that which the Assistant Commissioner rejected, but the latter held, because of deductions drawn from other matters appearing in the record, that the burden shifted to the party McCane to establish that he reserved from the sale the rights in the mark "Lucky...