W. R. Lynn Shoe Co. v. Auburn-Lynn Shoe Co.

• Decision Date: 19 December 1907
• Parties: W. R. LYNN SHOE CO. v. AUBURN-LYNN SHOE CO.
• Court: Maine Supreme Court

69 A. 569

103 Me. 334

W. R. LYNN SHOE CO.

v. AUBURN-LYNN SHOE CO.

Supreme Judicial Court of Maine.

Dec. 19, 1907.

Report from Supreme Judicial Court, Androscoggin County.

Bill by the W. R. Lynn Shoe Company against the Auburn-Lynn Shoe Company. Case reported, and master's report recommitted.

This cause has been before the law court once before, and the decision and report of the same is found in 100 Me. 401, 62 Atl. 499, 4 L. R. A. (N. S.) 960, and reference to that report is made for a statement of the original contentions between the parties. After the opinion and decision in 100 Me. 461, 62 Atl. 499, 4 L. R. A. (N. S.) 960, a decree for an injunction and an accounting was made, and the case committed to a master, with instructions as stated in the present opinion. By the same decree the bill was dismissed without costs as to Ralph M. Lunn and John L. Reed, who originally were made parties defendant. The master heard the parties, and then made and filed his report. Both parties took exceptions to the report.

The cause then came on for hearing before a justice of the Supreme Judicial Court "on the question of the acceptance of the report of the master, and the consideration of the exceptions of both parties thereto, and was argued by counsel. And thereupon, questions of law having arisen of sufficient importance to justify it and the parties agreeing to it," the cause was "reported to the law court for its determination," with the following stipulations: "If the law court is of the opinion that the master's report should be accepted as it stands, a final decree is to be directed for the plaintiff accordingly; otherwise the law court is to direct such orders and decrees as the rights of the parties require."

Argued before EMERY, C. J., and STROUT, SAVAGE, PEABODY, SPEAR, and CORNISH, JJ.

Oakes, Pulsifer & Ludden and Enoch Foster, for plaintiff. George C. Wing, George C. Wing, Jr., and White & Carter, for defendant.

EMERY, C. J. There has been much litigation between these two shoe manufacturing corporations, culminating in an opinion and decision that the defendant, a newer corporation, was and had been unlawfully endeavoring to draw to Itself the trade of the plaintiff, an older corporation, by using trade-marks more or less resembling those of the plaintiff, and by unfair competition through the use of a corporate name, billheads, letterheads, etc., calculated to give the impression that it was the plaintiff corporation or its successor, or that its shoes were the product of the plaintiff corporation. After the opinion and decision in 100 Me. 461, 62 Atl. 499, 4 L. R. A. (N. S.) 960, a decree for an injunction and an accounting was made, and the case committed to a master with the following instructions among others:

(a) To take an accounting of all the profits of the business of the defendant corporation realized from the sale of shoes upon which was impressed the trade-mark of the Auburn-Lynn Shoe Company, or any similar trade-mark using the name "Auburn-Lynn," between July 9, 1903, and the date of the decree, January 15, 1906.

(b) To take an accounting of all the profits of the defendant's business during the same period resulting from the wrongful acts committed by the defendant company in unfair competition with the plaintiff through similarity of name, etc.

(c) To ascertain the amount of all such profits of both classes (a and b) during that period.

(d) To ascertain the damages sustained by the plaintiff resulting from the wrongful use by the defendant of the plaintiff's trade-marks, and from other wrongful acts committed by the defendant in unfair com petition with the plaintiff during the same time.

Under this commission the master heard the parties, their evidence, and arguments, examined their books and papers, and made to the court a report of his findings and conclusions under each head and covering all the matters committed to him; but he did not report the evidence except so far as recited in his report, nor was he requested to do so. It was stipulated, however, that the facts found by the justice hearing the cause in the first instance, and those found by the law court on the appeal (100 Me. 461, 62 Atl. 499, 4 L. R. A. [N. S.] 960), should be considered as evidence reported. Each party filed exceptions to the report, and those exceptions and the whole question of the acceptance of the report were reported to the law court to direct such orders and decrees as the rights and duties of the parties require.

Upon all questions of fact the finding of the master has all the weight of a jury verdict, not to be set aside or reversed, unless the evidence reported shows the findings to be clearly wrong. Paul v. Frye, 80 Me. 26, 12 Atl. 544; Tilghman v. Proctor, 125 U. S. 136, 149, 8 Sup. Ct. 894, 31 L. Ed. 664. This principle is to be borne in mind in considering and determining questions of fact raised by the exceptions to the report.

Plaintiff's Exceptions.

1. Upon recurring to the instructions to the master, it will be seen that he was to ascertain the damages resulting to the plaintiff from two sources: (1) The damages resulting from the wrongful use of the plaintiff's trade-marks; and (2) the damages resulting from the defendant's unfair competition in other ways. As to some of the sales of shoes made by the defendant during the period in question, from July 9, 1903, to January 15, 1906, the master refused to include the profits on those sales in his assessment of damages for the reason stated in his report that "the evidence wholly fails to show any unfair competition or any ground for the inference that the plaintiff was injured thereby." To this finding and refusal the plaintiff excepted.

No evidence is adduced that any of the shoes in these particular transactions were so marked or advertised as to indicate that they were manufactured by the plaintiff. It is claimed, however, that the evidence does show that the defendant through all that period was persistently endeavoring by various unlawful devices, such as similarity of corporate name, of billheads, letterheads, etc., to appropriate the plaintiff's customers, business, and business reputation, etc., and hence that all its transactions during that time were at the expense of the plaintiff, and the profits on them should therefore be included in the damages. The master considered this claim, and yet found that these particular transactions did not appear to be at the expense of, or in any way injurious to, the plaintiff. The transactions themselves are not stated, and, since it was possible and even feasible for the defendant to sell some shoes of such kind and under such circumstances as not to affect injuriously the plaintiff's trade, the finding of the master is not shown to be clearly wrong. Granting the general fraudulent character as to the plaintiff of the defendant's business conduct, we should not assume that none of its business transactions were free from that fraud. The exception cannot be sustained.

2. The master also excluded from his com putation of damages the profits on certain sales made by the defendant to local dealers in Lewiston and Auburn after the change of its name from "Auburn-Lynn Shoe Company" to "Lunn & Lynn Shoe Company," be cause of his finding as a fact that these local dealers knew that the shoes purchased by them were not the product of the plaintiff company. He also excluded the profits on sales made to parties, who as he affirmatively found, never had purchased any goods of the plaintiff, and did not appear to have known of the plaintiff's existence. It does not appear that the shoes thus sold were impressed with any deceptive trade-mark.

The evidence before us is not sufficient to overcome the master's findings of fact as to these two classes of sales. Indeed the plaintiff does not claim so much, but urges that nevertheless the profits on these sales also should be included in the computation of its damages on the ground that the sales were in pursuance of the defendant's fraudulent purpose condemned by the court, and were...