National Biscuit Co. v. Kellogg Co.

• Decision Date: 13 July 1937
• Docket Number: No. 5801.,5801.
• Citation: 91 F.2d 150
• Parties: NATIONAL BISCUIT CO. v. KELLOGG CO.
• Court: U.S. Court of Appeals — Third Circuit

91 F.2d 150 (1937)

NATIONAL BISCUIT CO. v. KELLOGG CO.

No. 5801.

Circuit Court of Appeals, Third Circuit.

April 12, 1937.

Rehearing Denied July 13, 1937.

Thomas G. Haight, of Jersey City, N. J., David A. Reed, of Pittsburgh, Pa., Hugh M. Morris, of Wilmington, Del., and Drury W. Cooper and Charles A. Vilas, both of New York City, for appellant.

Edward S. Rogers and Crichton Clarke, both of New York City, and Arthur B. Seibold, of Chicago, Ill., for appellee.

Before BUFFINGTON, DAVIS, and THOMPSON, Circuit Judges.

DAVIS, Circuit Judge.

When this case was here before, we affirmed the decree of the District Court by a per curiam adopting the opinion of that court. It is before us now on reargument. The District Court and this court felt that the case was controlled by Singer Mfg. Co. v. June Mfg. Co., 163 U.S. 169, 16 S.Ct. 1002, 1014, 41 L.Ed. 118 on the ground that the name "Shredded Wheat" was a descriptive term, describing the product of the plaintiff and that, in any event, upon the expiration of the Perky patent No. 548,086, issued October 5, 1895, the name passed into the public domain, remained there, and became public property. Consequently we held that the appellant, hereinafter called plaintiff, did not have the right to the exclusive use of the name.

After exhaustively reviewing the authorities, Mr. Justice White in Singer Mfg. Co. v. June Mfg. Co., supra, declared the law on this subject to be as follows: "The result, then, of the American, the English, and the French doctrine universally upheld is this: That where, during the life of a monopoly created by a patent, a name, whether it be arbitrary or be that of the inventor, has become, by his consent, either express or tacit, the identifying and generic name of the thing patented, this name passes to the public with the cessation of the monopoly which the patent created. Where another avails himself of this public dedication to make the machine and use the generic designation, he can do so in all forms, with the fullest liberty, by affixing such name to the machines, by referring to it in advertisements, and by other means, subject, however, to the condition that the name must be so used as not to deprive others of their rights, or to deceive the public; and, therefore, that the name must be accompanied with such indications that the thing manufactured is the work of the one making it, as will unmistakably inform the public of that fact."

Therefore, upon the expiration of the patent, the defendant was free to adopt the name of "Shredded Wheat" to designate its product with some adequate explanation that the product was made by it and not by the plaintiff. This, however, it did not do, but waited ten years, and then, when it attempted to do so, immediately stopped upon complaint of the plaintiff and did not start again for five years.

In or about the year 1893 Henry D. Perky put into commercial use a new process for a form of food manufactured out of whole wheat and called the product "Shredded Wheat." The evidence shows that the process consisted in cleaning, curing, drying, and boiling the wheat and thereafter passing the softened grains between two rollers. The surface of one of these was flat and the other contained grooves. The rollers exerted great pressure upon the wheat, which came out in long filaments or threads, which were later cut, made in the form of a pillow-shaped biscuit, placed in an oven at a temperature of approximately 500 degrees Fahrenheit, and baked until all but a small percentage of the moisture had been removed. The biscuits were then sold under the name of "Shredded Wheat," and "Shredded Wheat Biscuit."

With the exception of the Ross Company, for a short time in 1915, and the defendant, for a short time in 1922, no one, in the fifteen years after the expiration of the patent, used the name "Shredded Wheat" to designate his product, and they both immediately stopped on complaint of plaintiff.

In 1927, however, the defendant began again to manufacture biscuits and sell them under the name of "Shredded Whole Wheat Biscuit." Suit was brought against it in the District Court of Connecticut. While that suit was pending, the defendant in 1930 abandoned the name of "Shredded Wheat" to designate its product and instead used the name of "Kellogg's Whole Wheat Biscuit." Thereupon the suit was discontinued.

But in 1932 the defendant started to use in its advertisements the name "Shredded Wheat" and the plaintiff's trade-mark, consisting of a dish, containing two biscuits submerged in milk, to identify its product.

During that period of fifteen years, after the expiration of the Perky patent in 1912, the plaintiff and its predecessors spent more than $17,000,000 in advertising, and creating good will in the name of "Shredded Wheat" and in its trade-mark.

They thus built up a large business and a very valuable good will. Between 1896 and 1932 they sold in the United States 45,353,320 cases, containing 19,592,634,240 biscuits. In 1932, the product was found upon the breakfast tables of more than 25,000,000 families. It is undisputed that at the time defendant adopted the name "Shredded Wheat," and the trade-mark of the plaintiff to designate its product, the trade and consumers generally had come to regard the name and trade-mark as identifying the plaintiff's biscuit.

If the name "Shredded Wheat" were purely descriptive of plaintiff's product it could not have been the subject of a patent, for "whatever is mere description is open to all the world." Cheavin v. Walker, 5 Ch.Div. 850; Singer Mfg. Co. v. June Mfg. Co., 163 U.S. 169, 194, 16 S.Ct. 1002, 41 L.Ed. 118. Defendant contends that the name is descriptive, and may be used by it, but we do not think it is. The evidence shows that in reducing the grains of wheat to the product called "Shredded Wheat" there is no cutting or tearing into small pieces or shreds. As above stated, after the wheat has been cleaned, cooked, cured, and partially dried, it is passed between two rollers of highly tempered steel in contact at high pressure, one roller having a flat surface and the other having grooves in its circumference varying in depth from .017 to .024 inches. The grains of wheat are thus forced into the grooves, mashed, and the component parts thoroughly macerated. They come from the rolls in the form of long filaments or threads. These threads of wheat come out or extrude from the rollers just as steel rails do when steel is passed between rollers, and just as copper wire does when copper is passed between rollers. But it has never been suggested that in making steel rails or copper wire the steel or wire was "shredded." Neither can it be said that the wheat is "shredded" in the plaintiff's process. It is mashed and mangled. The name at most is merely suggestive, and words suggestive of the qualities or characteristics of an article may be used as valid trade-marks. Pennsylvania Salt Mfg. Co. v. Myers (C. C.) 79 F. 87; Globe-Wernicke Co. v. Brown et al. (C.C.) 121 F. 185; Trinidad Asphalt Manufacturing Co. v. Standard Paint Co. (C.C.A.) 163 F. 977; Van Camp Sea Food Co. v. Alexander B. Stewart Organizations (Cust. & Pat.App.) 50 F. (2d) 976. The true descriptive name for this product is "whole wheat biscuit." This has been recognized by the appellant's competitors and many others. Twenty-seven states, including Delaware, and many foreign countries have accepted and registered the word "Shredded Wheat" as a legitimate trade-mark which could not properly be done if the name were simply descriptive.

But assuming, merely for the sake of argument, that the word "shredded" was originally a descriptive term and used to describe the action upon the wheat, it would manifestly be unfair after all these years and the expenditure of vast sums of money, when the name has acquired a secondary meaning, and has come to stand for the product itself, to allow the defendant to use it as it has done and thus acquire the trade which rightfully belongs to plaintiff.

In 1912, when the Perky patent expired, the defendant or any competitor might have used the name and form of the biscuit under proper restrictions, to designate his product, but the fact is that nobody did it, and nobody attempted to do it, with the exception of the defendant and the Ross Company, as above stated. During all this time the defendant and all other competitors sat by and allowed the plaintiff at great expense to...