Truck Ins. ex. v. Truck Ins. ex.

• Decision Date: 26 November 1940
• Citation: 107 P.2d 511,165 Or. 332
• Parties: TRUCK INSURANCE EXCHANGE <I>v.</I> TRUCK INSURANCE EXCHANGE, OF 649 SOUTH OLIVE STREET, LOS ANGELES, CALIFORNIA, ET AL.
• Court: Oregon Supreme Court

165 Or. 332

107 P.2d 511

TRUCK INSURANCE EXCHANGEv.

TRUCK INSURANCE EXCHANGE, OF 649 SOUTH OLIVE STREET, LOS ANGELES, CALIFORNIA, ET AL.

Supreme Court of Oregon.

Argued October 1, 1940.

Affirmed November 26, 1940.

Appeal and error

1. The propriety of ruling sustaining objection to certain of plaintiff's testimony and overruling plaintiff's motion for leave to amend complaint so as to afford a better basis for testimony which it had offered was not before supreme court, where the rulings were not made the subject matter of an assignment of error, nor of any argument in brief.

Trade-marks and trade-names and unfair competition

2. One can not dip into the common vocabulary and, selecting some generic or descriptive words which commonly designate business activities in which people engage, appropriate the words to himself and thereby forbid their use by others who desire to launch similar enterprises, but a name of a generic type may acquire a secondary meaning requiring later users to adopt means to avoid public deception.

Trade-marks and trade-names and unfair competition

3. The name "Truck Insurance Exchange" was a generic or descriptive term incapable of exclusive appropriation by plaintiff and use of same name by defendant would not be enjoined, where it did not appear that name had acquired a secondary meaning by use of it by plaintiff requiring later users to adopt means to avoid public deception.

Trade-marks and trade-names and unfair competition

4. Plaintiff was not entitled to enjoin defendant from use of name "Truck Insurance Exchange", on ground of prior appropriation, even if such ground were otherwise available, where evidence indicated that promoters of plaintiff knew of existence of business activities of defendant before plaintiff filed its articles of incorporation.

Trade-marks and trade-names and unfair competition

5. In suits to enjoin use of similar business names, it is the public which is protected through medium of affording protection to a business which has won the public confidence so that another business which has recently entered the field will not deceive the trade into a belief that it is the business unit to which the public has become accustomed.

Trade-marks and trade-names and unfair competition

6. Evidence failed to establish that plaintiff was entitled to an injunction enjoining use of name "Truck Insurance Exchange"

in state by a reciprocal insurance association composed of commercial truck owners, which was organized in California, where evidence failed to indicate that plaintiff had any business when suit was filed, or that it had any business when defendant association was authorized to do business in state.

Trade-marks and trade-names and unfair competition

7. Evidence failed to establish that defendants appropriated to their use any plans, ideas or rate structures for a truck insurance exchange of plaintiff, so as to entitle plaintiff to damages.

Trade-marks and trade-names and unfair competition

8. Plaintiff corporation, a truck insurance exchange, was not entitled to enjoin reciprocal insurance association which was organized in California from use of name "Truck Insurance Exchange" in state, even if assumed that plaintiff corporation conducted an insurance agency, where such type of business and one in which reciprocal insurance association was engaged were so different that possibility of public being misled was remote.

                  Protection of business or trading corporation against use of
                same or similar name by another corporation, note, 115 A.L.R
                1241. See, also, 26 R.C.L. 887. (8 Perm. Supp. 5816)
                

In Banc.

Appeal from Circuit Court, Marion County.

L.G. LEWELLING, Judge.

Action by the Truck Insurance Exchange, an Oregon corporation, against the Truck Insurance Exchange, of 649 South Olive Street, Los Angeles, California, and the Truck Underwriters Association of 649 South Olive Street, Los Angeles, California, to enjoin the defendant Truck Insurance Exchange from use of plaintiff's name, and for a recovery of judgment against both defendants. From a decree for defendants, the plaintiff appeals.

AFFIRMED.

Paul R. Hendricks, of Salem, for appellant.

Robert F. Maguire and Donald K. Grant, both of Portland (Maguire, Shields & Morrison, of Portland, on the brief), for respondents.

ROSSMAN, J.

This is an appeal by the plaintiff from a decree of the circuit court in favor of the two defendants which was entered in a suit instituted for the purpose of securing a decree enjoining one of the two defendants (Truck Insurance Exchange) from the use of its name, and for the recovery of a judgment against both it and the other defendant in the sum of $100,000. The latter is the amount in which the plaintiff says it was damaged through the defendants' alleged (1) wrongful appropriation to the defendants' use of the plaintiff's name; (2) wrongful conversion of an insurance business which the plaintiff says it had established; and (3) wrongful appropriation to defendants' use of some records, plans and rate structures concerning which the plaintiff further alleges that (a) they were useful in the establishment and operation of a reciprocal insurance exchange; (b) the plaintiff owned them; and (c) they were original, unique and valuable. The defendants deny all averments which charge them with wrongful conduct. They also deny that the plaintiff had established a business and that it possessed any unique plans, ideas and rate structures suitable to a reciprocal insurance exchange. They aver that the defendant insurance exchange had been organized and was engaged in business before the incorporation of the plaintiff.

The plaintiff is an Oregon corporation possessing a capital stock of $5,000. It filed its articles of incorporation August 22, 1935. From them we quote:

"The objects of this corporation and the business in which it proposes to engage are as follows: To maintain an agency for the issuing, writing and selling policies of insurance issued by the regularly incorporated insurance companies and/or reciprocal insurance exchanges * * * to conduct a general insurance agency and insurance brokerage business * * *."

The other provisions of its articles of incorporation authorize it to buy, own and sell notes, stocks, bonds and other evidences of indebtedness as well as to buy, rent, own and sell real property. The plaintiff never possessed a license to act as agent for any insurance company and never was appointed by any insurance company as agent. It never sought to become nor was it ever an insurer. By reverting to the review of its articles of incorporation, it will be observed that they do not confer upon it power to engage in such a venture.

The defendant Truck Insurance Exchange is not a corporation. It is a reciprocal insurance association composed of commercial truck owners which was organized February 2, 1935, in Los Angeles, California. Its members are not identified with the plaintiff. They exchange between themselves contracts of reciprocal insurance. Sections 46-1316 to 46-1332, Oregon Code 1935 Supp., which contain the provisions of our laws regulating reciprocal insurance associations, refer to them as exchanges. We shall employ that word as a convenient means of identifying the defendant just mentioned. February 5, 1935, the Commissioner of Insurance of the State of California issued to the defendant exchange a certificate of authority authorizing it "to transact the business of accident and health, liability and automobile insurance, on the inter-insurance plan, within this State." February 18, 1935, the exchange forwarded to the Insurance Commissioner of the State of Oregon an application for a similar certificate. December 2, 1935, the requested certificate was issued and thereupon the exchange proceeded to exercise in this state the rights thus conferred. It is similarly licensed in virtually all of the other states west of the Mississippi River.

The defendant Truck Underwriters Association is a California corporation which filed its articles of incorporation with the Secretary of State of California January 14, 1935. Those articles secured for it the right to serve as attorney-in-fact for reciprocal insurance exchanges. Ever since the defendant insurance exchange was authorized to transact business the corporation just mentioned, that is, the Truck Underwriters Association, has served as its attorney-in-fact.

In order to facilitate an understanding of the situation, we add that the attorney-in-fact for a reciprocal insurance exchange handles virtually all of its business affairs. It obtains for the exchange the applications for insurance, or, to speak more accurately, it obtains for it the applications for membership. It also selects the risks, rejecting those which do not meet its requirements. The defendant Truck Underwriters Association receives as compensation for the services which it performs for the defendant exchange 20 per cent of the sums paid as premiums.

Before further relating the facts, it may be well to note once more that the plaintiff is neither a reciprocal insurance exchange nor an insurance company. Since it never possessed a license to handle insurance as a broker, nor was ever appointed agent by an insurer, it likewise has never served either as broker or agent. A reciprocal insurance exchange, according to the evidence, is never a corporation; it is always a non-incorporated association. Its members indemnify one another against loss and, in turn, receive from one another indemnity against loss. The inter-insurance among the hundreds or thousands of members is effected through the medium of an attorney-in-fact.

The complaint alleges that ever since the plaintiff was incorporated it has been engaged in the business of

"writing and selling policies of insurance of every kind and nature whatsoever issued by regularly incorporated insurance companies and reciprocal insurance exchanges both domestic and...