The Peck Bros. & Co. v. Peck Bros. Co.

• Decision Date: 21 January 1902
• Docket Number: 818.
• Citation: 113 F. 291
• Parties: THE PECK BROTHERS & COMPANY v. PECK BROS. CO. et al.
• Court: U.S. Court of Appeals — Seventh Circuit

113 F. 291

THE PECK BROTHERS & COMPANY v. PECK BROS. CO. et al.

No. 818.

Circuit Court, of aPpeals, Seventh Circuit.

January 21, 1902

H. D Coghlan, for appellees.

The appellant, a corporation of the state of Connecticut, filed its bill against the corporation 'Peck Bros. Co.' and the individual defendants, who are its officers and directors, to restrain (1) the use of the name 'Peck Bros. & Co.' or 'Peck Bros. Co.' or 'Peck Bros.' or names substantially identical therewith, in connection with the prosecution of the business of the manufacture, purchase, and sale of plumbing, gas and steam fitting materials and supplies, fixtures, brass and iron goods; (2) from holding out or representing that the goods manufactured by them are the same as those manufactured by the complainant; and (3) from using or interfering with the paramount right of the complainant to the name of 'Peck Brothers & Co.,' or 'Peck Bros.,' or 'Peck Bros. Co.,' in connection with the manufacture and sale of goods of the character stated; and seeking also to recover damages sustained by reason of the alleged unauthorized interference with the complainant's paramount right in the use of the names stated. The bill was answered to, and upon the evidence taken the court below on July 8, 1901 dismissed the bill for want of equity.

Elnathan Peck and his two sons, J. M. Peck and Henry F. Peck, under the firm name of E. Peck & Sons, in the year 1859, commenced the business of the manufacture of brass goods for plumbers and gas and steam fitters at New Britain, in the state of Connecticut. In the year 1862, the corporation 'Peck Brothers & Co.' was organized, and became the successor in business of the firm of E. Peck & Sons. This corporation was composed, in part, at least, of the two sons of Elnathan Peck, and the plant of the business at that date had been removed to the city of New Haven. The capital stock of the corporation was originally $35,000. This was increased from time to time until in March, 1896, it was $750,000. The business had greatly grown in volume, and its product had become well and thoroughly known to the trade throughout the country as 'Peck Brothers' Goods.' Branch offices for the sale of its product were established in the cities of New York, Boston, and Chicago,-- in the latter city in the spring of 1889. The office in Chicago was placed in the charge and management of the defendants Oliver D. Peck and Albert D. Sanders. The former was then a stockholder in, and the secretary of, the Connecticut corporation, and was its vice president from 1894 to 1896, and is now the president of the defendant corporation. The latter was a stockholder in the Connecticut corporation, and conducted the branch on a salary, and is now the general manager of the defendant corporation. The defendant William A. Ratcliffe was also a stockholder in the Connecticut corporation, and was the principal salesman in the Chicago branch, and is now the secretary of the defendant corporation. On the 14th day of March, 1896, the corporation became embarrassed; and a bill was filed in the superior court of the county of New Haven Conn., by the owners of a majority of the stock, against the corporation, for the appointment of a receiver. Oliver D Peck, one of the defendants in this suit, was a plaintiff in that suit. Receivers were duly appointed, who took charge of the corporation and managed its business. On March 16, 1896, the defendant Oliver D. Peck, with others, filed an ancillary bill in the circuit court of the United States for the Northern district of Illinois, upon which the defendant Albert D. Sanders was appointed ancillary receiver of the corporation with respect to its property in the state of Illinois, for the benefit of the principal receivers, appointed by the superior court for the county of New Haven, Conn. On June 25, 1896, Henry D. Coghlan, W. J. Naughton, and George C. Morton filed with the secretary of state of the state of Illinois a certificate signed by them, respectively, in which they proposed to form a corporation under the name of 'Peck Bros. Co.,' for the manufacture and sale of plumbing, gas fitting, steam fitting, sewer pipe, sewer building materials and supplies, also hardware, brass, and iron goods, metals, and machinery, with a capital stock of $75,000, divided into 750 shares; the principal office of the company to be located in the city of Chicago. A license was thereupon issued to them as commissioners to open books for subscription for the capital stock. On August 21, 1896, they reported to the secretary of state that the stock was fully subscribed as follows: Oliver D. Peck, 100 shares, amounting to $10,000; Henry D. Coghlan 200 shares, $20,000; William A. Ratcliffe, 72 shares, $7,200; James L. Ratcliffe, 378 shares, $37,800,-- and that there had been elected as directors the four subscribers to the capital stock and George C. Morton, whereupon on that day the secretary of state issued his certificate 'that the said Peck Bros. Co. is a legally organized corporation under the laws of this state. ' Mr. Coghlan, who subscribed for 200 shares, was the attorney of the Chicago branch and was one of the attorneys of the defendant Sanders as receiver, and is one of the solicitors of record for the defendants in this suit. The bill charges the fact to be 'that, although the name of the defendant Albert D. Sanders does not appear as one of the incorporators of the defendant 'Peck Bros. Co.,' he was directly interested and contributed toward the payment upon the shares of its capital stock, and that as your orator is informed and believes, the two hundred shares of capital stock of said corporation subscribed by Henry D. Coghlan were in reality a subscription in trust for and in behalf of the defendant Albert D. Sanders; that the said Henry D. Coghlan was the confidential attorney of the said Albert D. Sanders both before and after his appointment as ancillary receiver; that said Albert D. Sanders immediately upon resigning his said receivership became the general manager of the defendant 'Peck Bros. Co.,' and has continued to be such general manager up to this time, and has taken an active part in the conduct and management of the affairs of said corporation from the time of its creation. ' To this allegation the defendant Albert D. Sanders answered that he 'denies that on the 25th day of June, 1896, he conspired with the defendants William D. Peck and William A. Ratcliffe for the purpose of obtaining the name and good will and business of the firm of Peck Bros. & Company. He denies that he had anything to do with the organization of Peck Bros. Company, the defendant company. He denies that the said Henry D. Coghlan was his confidential attorney, either before or after his appointment as ancillary receiver, but represents the fact to be that Henry D. Coghlan was the attorney for Peck Bros. & Company of New Haven, Conn., for years prior to its insolvency, and after its insolvency acted in connection with E. A. Otis as attorneys of the receivers in winding up the affairs of Peck Bros. & Company, and that everything done by the said Henry D. Coghlan in the organization of Peck Bros. Company was done for purposes and reasons unknown to this defendant, and in no way connected with him. ' All the defendants, except the defendant James L. Ratcliffe, 'further answering, deny that the plaintiff has the exclusive right to the use of the name 'Peck Bros. & Co.,' 'Peck Bros. Co.,' or 'Peck Bros.,' or the name of 'Peck,' in connection with its said business. These defendant aver and charge that the defendant Peck Bros. Company is alone entitled to the use of the said name or names; that it was duly incorporated under the laws of the state of Illinois long prior to the complainant; that it purchased the assets and good will of the Western branch of Peck Bros. & Co.' that its company is headed by Oliver D. Peck, of the original firm of Peck Bros. & Co., who acts as its president; and that it had been in existence and doing business since June, 1896, and under the name adopted has built up a large business, which it alone is entitled to share and enjoy. ' No evidence was taken on behalf of the defendants below, except the deposition of one Wilson, the representative of the defendant corporation in the city of New York, touching the location of its office in that city.

There were negotiations in the spring of the year 1896, between the Connecticut receivers and Mr. Sanders, the ancillary receiver, on the one hand, and William A. Ratcliffe, representing a syndicate for the purchase of the property of the Connecticut corporation located in the city of Chicago. It was unknown to the Connecticut receiver who composed that syndicate. After some negotiation a price was fixed for the goods, and the sale was finally consummated in the month of September. The Connecticut receivers heard of the proposed new corporation in Illinois, not from the parties, but from some person on the outside, and on August 8th wired Mr. Sanders as follows: 'We object to title of new company. Avoid recognizing in any way,'-- and on the same day addressed to him the following letter:

'New Haven, Conn., August 8, 1896.

'Mr. A. D. Sanders, Receiver, Chicago-- Dear Sir: Since we heard of the organization of the new company to succeed to our business in Chicago, we have seriously considered the matter of allowing them to use the name Peck Bros. in any way, and in conversation with one of our prominent stockholders, Mr. W. H. Hart, he decidedly objected to it. While the intentions of the projectors might be all right, I can readily see where serious complications might arise from any company doing business in the same line under the name of Peck Bros., and we shall be under the necessity of

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