Dr. S. A. Richmond Nervine Company v. Richmond/Opinion of the Court

The record in this case presents only questions of fact, in which are involved the ownership of a trade-mark devised by Dr. Richmond in December, 1883, consisting of a portrait of himself, surrounded by four globes. Plaintiff's theory in this connection is that the trade-mark in question was designed by Dr. Richmond while acting as president and manager of the medical company; was adopted, and, if not used, was advertised as about to be used, by that company, prior to its assignment, on May 13, 1884; that it passed to Tyler, the assignee of such company, by virtue of the general assignment made upon that day for the benefit of its creditors; that by him it was sold to James A. Richmond, with the other assets of the medical company, August 28, 1884, Richmond, in turn, assigning and transferring it to the nervine company, the plaintiff in this suit.

The theory of the defendant is, as stated in his testimony, that the medical company never acquired any property or assets; that he (the defendant) had arranged with his brother, with the two other stockholders of the company, and his wife, Eva, before the company was organized, that the transfer of the property was for his own benefit, and the stock all issued in trust for him; that the sale to the medical company of the property mentioned was a mere form; that he decided in the fall of 1884 to change the trade-mark and wrapper from the old style to the new style; that he spoke to his brother about it, and stated to the company that he would lease his trade-mark, viz. the portrait of himself surrounded by the four globes, to the company, provided they compromised with one Hubbard, of New Haven, to whom the company had become indebted in the sum of $33,000 for advertising; that he had engravings made in Chicago on his own account, for his own benefit, and paid for them himself; that he subsequently went to Philadelphia, after the engraving was done, and ordered boxes, cartoons, caddies, etc., for himself, on his own account, and paid for them himself, though he may have used the company's money and signed the company's check for the amount; that the money was in fact his; that the company made an assignment, but failed to lease his trade-marks, owing to the claim of Hubbard not being settled or arranged. If, as he swears, the medical company was but another name for himself, and belonged to him, it is difficult to see why he should have ordered the engravings, bottles, and cartoons on his own account, and paid for them with his own money, as distinguished from the money of the company, or why he should have talked as he did about separating from the company, and entering into business on his own account.

He further states that he did lease the trade-mark in question to the nervine company about December 11, 1884, when he became the general manager of the company, and had charge and control of its business up to January, 1886, soon after which he became incapacitated and insane; that in the latter part of 1887 he notified the nervine company to cease using his trade-marks, and finally, in 1889, brought suit to compel them to do so.

There is a large amount of testimony in the case which is manifestly irrelevant to the question in issue. While it is entirely possible that the medical company may have been organized for the purpose of enabling Dr. Richmond to avoid individual liability, and the stock which properly belonged to him put in the name of the nominal stockholders, in pursuance of a scheme to defraud his creditors, the existence of this corporation cannot be ignored in this proceeding. Were the proof never so satisfactory that the 47 shares of stock of the medical company transferred by defendant's brother to his wife, Eva, were in fact intended to be held in trust for him, we could not assume that she was not the bona fide owner of the stock standing in her name, as the object of this suit is not to impeach such ownership; nor could it be done in any suit to which she was not a party.

The real question is whether on May 13, 1884, the date of the general assignment to the medical company, it was then the owner of the trade-mark in question, since, if it were, it passed to the assignee of the corporation, as a part of its assets. Upon this point there is considerable conflict of testimony. Prior to 1884 the only trade-mark in use by the medical company was that of a man falling in a fit, and this, it is admitted, passed to the assignee, and is now the property of the plaintiff. There is no doubt that Dr. Richmond, in November or December, 1883, while acting as president and manager of the company, devised the trade-mark in question, and made all the necessary arrangements for the intended change in the size of the bottle and in the trade-mark; that advertisements were put into circulars notifying the trade that the change would take place on the 1st of May, 1884; that the bills for engraving this trade-mark were all paid for by the company, and charged, not to Dr. Richmond personally, but to the expense account of the company; that the circulars announcing the proposed change were printed and circulated in January and February of that year, under the supervision of Dr. Richmond; that these circulars contained a facsimile of the cartoon or caddy as it would appear, together with a notice warning the public that none would be genuine unless thus encased, and bearing the following inscription: 'Have Dr. Richmond's picture blown in the bottle, his picture to be printed on two sides of the caddy or cartoon, and the bottle enlarged'; that orders were placed for the new style of bottle with a Pittsburgh firm, and were paid for by the company on delivery. Some of these bottles were received about the 1st of May, while Dr. Richmond continued to be superintendent of the company, and a memorandum of their payment appears upon the cash book of the company. There was also an order placed for cartoons to be used after May 1st, for wrapping or encasing the nervine preparation, which were also paid for by the company. These cartoons contained the words, 'Put up or prepared by the Dr. S. A. Richmond Medical Company.' After Dr. Richmond left St. Joseph and went to Chicage, the words, 'Prepared by the Dr. S. A. Richmond Nervine Company,' were changed to 'Prepared by the World's Medical Association,'-the name under which defendant did business in Chicago. While it is doubtful whether the medical company actually sold any medicines put up in the new bottles and encased in the new wrappers, and bearing the new trade-mark, before its assignment, there is no doubt that a large quantity of these bottles, cartoons, and wrappers were on hand at the time of such assignment, which had been paid for, and belonged to the company. Nor is there any doubt that after the organization of the nervine company these bottles, wrappers, and trade-marks were made use of by such company, the plaintiff in this case, so long as Dr. Richmond continued to be its general manager. Defendant claims that this was done under a lease from himself, which was in writing; but this lease is neither produced nor accounted for, and in his cross bill only an oral license is claimed. The business done by Dr. Richmond in Chicago from July to October, 1884, under the name of the World's Medical Association, appears to have been a mere episode, as he resumed business is St. Joseph upon the organization of the plaintiff company, in December, 1884, and continued with them until January, 1886.

The testimony of Dr. Richmond, who was the main witness in his own behalf, is matrially impaired, not only by his own confession that the organization of the medical company was procured by himself for the purpose of defrauding his creditors, and that the first appraisement and sale of its assets were also a fraud concocted by him for the same purpose, but by the further fact that in a suit brought at Columbus, Ohio, against him for advertising, he swore that he owned none of the stock of the medical company, and that he had no interest in such stock. A witness who at different times gives different versions of the same transaction, and blows hot or cold as his interest in the particular litigation may require, can scarcely complain if the court fail to give his testimony the weight to which it would otherwise be entitled.

In fine, we are of the opinion that the nervine company is justly entitled to the use of the trade-mark in question.

The fact that such trade-mark bears Dr. Richmond's own name and portrait does not render it unassignable to another. Kidd v. Johnson, 100 U.S. 617, 620; Chemical Co. v. Meyer, 139 U.S. 540, 11 Sup. Ct. 625; Hoxie v. Chaney, 143 Mass. 592, 595, 10 N. E. 713; Fish Bros. Wagon Co. v. La Belle Wagon Works, 82 Wis. 546, 52 N. W. 595.

The decree of the court below must be reversed, and the case remanded for further proceedings in conformity with this opinion.