The Borden Co. v. Schreder
| Decision Date | 21 October 1947 |
| Citation | 182 Or. 34,185 P.2d 581 |
| Parties | THE BORDEN COMPANY <I>v.</I> SCHREDER |
| Court | Oregon Supreme Court |
1. A suit to enjoin sale of trade-marked commodity at price less than minimum resale price established pursuant to Fair Trade Act sounded in tort and was based on violation of the act and not on breach of contract. O.C.L.A. §§ 43-401 to 43-405.
Trade-marks and trade-names and unfair competition — Fair Trade Act — Established resale price
2. In manufacturer's suit to enjoin retail dealer from selling trade-marked commodity at price less than minimum resale price established pursuant to Fair Trade Act, established resale price for commodity can be shown by proof of existence of fair trade contracts with other dealers. O.C.L.A. §§ 43-401 to 43-405.
Trade-marks and trade-names and unfair competition — Fair trade contracts
3. In suit to enjoin retail dealer from selling trade-marked commodity at price less than fixed minimum resale price established pursuant to Fair Trade Act, fair trade contracts executed by representatives of manufacturer and ratified by manufacturer were sufficient to show that manufacturer had established minimum resale price for such commodity, notwithstanding that representatives may not have been authorized to act for manufacturer. O.C.L.A. §§ 43-401 to 43-405.
Trade-marks and trade-names and unfair competition — Fair trade contracts — Price
4. A signer of fair trade contracts cannot, upon termination of contract, sell trade-marked commodity at price less than minimum resale price established pursuant to Fair Trade Act. O.C.L.A. §§ 43-401 to 43-405.
Trade-marks and trade-names and unfair competition — Manufacturer — injunction
5. A manufacturer of trade-marked commodity was entitled to injunction against sale of commodity by retail dealer at less than minimum resale price established in fair trade contracts with other retail dealers in Oregon, notwithstanding that dealer was not a party to any such contract, where dealer had notice of such contracts and continued to sell commodity at less than price established therein. O.C.L.A. §§ 43-401 to 43-405.
Constitutional law — Fair Trade Act — Legislative question
6. The soundness of economic theory reflected in Fair Trade Act as affecting public welfare is a legislative and not a judicial question. O.C.L.A. §§ 43-401 to 43-405.
Trade-marks and trade-names and unfair competition — Fair Trade Act
7. Enactment of Fair Trade Act is within legislative power. O.C.L.A. §§ 43-401 to 43-405.
Trade-marks and trade-names and unfair competition — Fair Trade Act — Construction
8. The court must so construe Fair Trade Act as to effectuate its purpose. O.C.L.A. §§ 43-401 to 43-405.
See 125 A.L.R. 1335
52 Am. Jur. 648
63 C.J., Trade Marks, Trade Names, Unfair Competition, § 136
Appeal from Circuit Court, Marion County.
Hugh L. Biggs, of Portland (with Hart, Spencer, McCulloch & Rockwood and Frederick H. Torp, of Portland, on brief), for appellant.
George A. Rhoten, of Salem (Rhoten & Rhoten on brief), for respondent.
Before LUSK, Acting Chief Justice, and BELT, KELLY, BAILEY and HAY, Justices.
Action by the Borden Company, a corporation, against Edwin Schreder, to enjoin the defendant from offering for sale or selling a distinctive trade-marked commodity at a price less than the minimum resale price established pursuant to the Fair Trade Act of Oregon, O.C.L.A. §§ 43-401 to 43-405. From a decree of dismissal, the plaintiff appeals.
REVERSED AND REMANDED.
This is a suit to enjoin the defendant from offering for sale or selling a distinctive trade-marked commodity called "Hemo" at a price less than the fixed minimum resale price established pursuant to the Fair Trade Act of Oregon (§§ 43-401 to 43-405, inclusive, O.C.L.A.) From a decree dismissing the suit, the plaintiff has appealed.
In January, 1942, The Borden Company, a corporation, placed on the market for sale in Oregon a malted milk preparation called "Hemo," in free and open competition with other commodities of the same general class, at what it claims was an established minimum resale price of 59 cents per one pound tin container. Vast sums were expended by The Borden Company in nationally advertising such commodity and in establishing its good will in connection therewith. Borden Company consistently maintained this fixed price in Oregon and elsewhere in the nation. There has never been any change in the minimum resale price. Borden sought to invoke the protection of the Fair Trade Act by entering into contracts with various retail dealers in the state who agreed, in the language of the Act, not to "resell such commodity at less than the minimum price stipulated by the seller," viz.: 59 cents.
The defendant Schreder and his wife own and operate a grocery store and meat market in Salem, Oregon, under the style and trade name of "Schreder's Four Star Market." Defendant Schreder has continuously offered for sale and sold "Hemo," in trade-marked one pound containers, at a price of 53 cents ever since his firm commenced handling the commodity in January, 1942. He asserts that he will continue to sell "Hemo" at such price, unless restrained by court from doing so. At various times Borden, through its representatives, notified Schreder of the fixed minimum resale price as established in contracts with other retail dealers in the state and demanded that he cease violation of the Act, but he refused to sell "Hemo" at any price other than 53 cents per pound. Schreder admits that he had knowledge of the existence of contracts between Borden and retail dealers, stipulating the minimum resale price of 59 cents. Schreder was not a party to any contract fixing the minimum resale price, although he was requested by Borden to sign one.
In the Circuit Court defendant challenged the constitutionality of the Fair Trade Act on various grounds, but on appeal has abandoned such contentions. Ever since the decision of the Supreme Court of the United States in Old Dearborn Distributing Co. v. Seagram-Distillers Corp., decided in 1936, 299 U.S. 183, 81 L.ed. 109, 57 Sup. Ct. 139, 106 A.L.R. 1476, sustaining the constitutionality of the Fair Trade Act of Illinois, the validity of such legislation has not been considered an open question. That the constitutionality of similar acts has been sustained throughout the nation, see authorities in Note, 125 A.L.R. 1336.
1. It is argued by defendant that since he was not a party to any Fair Trade contract with Borden, he is not bound by the terms thereof prohibiting the sale of "Hemo" at less than the stipulated price. The fallacy of this contention lies in the assumption that the relief sought by plaintiff is based on any contractual relationship with the defendant. This suit sounds in tort. Plaintiff asserts that Schreder violated the Fair Trade Act and is guilty of "unfair competition," as defined therein, in that he sold a trade-marked commodity at less than the resale maintenance price. In other words, Borden's suit is based on violation of a statute and not on breach of contract.
Section 1 of the Act as amended, Chapter 113, Oregon Laws 1937, codified as § 43-401, O.C.L.A., provides that a contract wherein the buyer agrees that he "will not resell such commodity at less than the minimum price stipulated by the seller" shall not, by reason thereof, be deemed in violation of the law.
Section 2 of the Act (§ 43-402, O.C.L.A.) provides:
"Wilfully and knowingly advertising, offering...
To continue reading
Request your trial
-
Shakespeare Co. v. Lippman's Tool Shop Sporting Goods Co.
... ... 959, 9 So.2d 303; W. A. Sheaffer Pen Co. v. Barrett, 209 Miss. 1, 45 So.2d 838; Rayess v. Lane Drug Co., 138 Ohio St. 401, 35 N.E.2d 447; Borden Co. v. Schreder, 182 Or. 34, 185 P.2d 581; Welch Grape Juice Co. v. Frankford Grocery Co., 36 Pa. Dist. & Co. 653; Miles Laboratories v. Seignious, ... ...
-
Scovill Mfg. Co. v. Skaggs Pay Less Drug Stores
...N.Y., 167, 7 N.E.2d 30, 110 A.L.R. 1411; Lilly & Co. v. Saunders, 1939, 216 N.C. 163, 4 S.E.2d 528, 125 A.L.R. 1308; Borden Co. v. Schreder, 1947, 182 Or. 34, 185 P.2d 581; Burch Co. v. General Electric Co., 1955, 382 Pa. 370, 115 A.2d 361; Miles Laboratories, Inc., v. Owl Drug Co., 1940, 6......
-
McGraw Elec. Co. v. Lewis & Smith Drug Co.
...273 N.Y. 167, 7 N.E.2d 30, 110 A.L.R. 1411; Ely Lilly & Co. v. Saunders, 216 N.C. 163, 4 S.E.2d 528, 125 A.L.R. 1308; Borden Co. v. Schreder, 182 Or. 34, 185 P.2d 581; Miles Laboratories Inc. v. Owl Drug Co., 67 S.D. 523, 295 N.W. 292; Frankfort Distillers Corp. v. Liberto, 190 Tenn. 478, 2......
-
General Elec. Co. v. Wahle
...are binding upon the trial court.' The first case cited by plaintiff in support of the foregoing proposition is: Borden Co. v. Schreder, 182 Or. 34, 37, 185 P.2d 581, 582. That case was decided in In that case we said: 'In the Circuit Court defendant challenged the constitutionality of the ......