Howe Scale Company of 1886 v. Benedict/Opinion of the Court

It appeared that the mandate of the circuit court of appeals was issued April 22, 1903, and that the circuit court entered a final decree, June 22, 1903, enjoining the use of the word 'Remington,' and also that after the original decree of the circuit court the Remington-Sholes Company changed its corporate name to that of Fay-Sholes Company, and ceased to make its machines marked with the registered trademark 'Rem-Sho,' and with the inscription 'Remington-Sholes Company, Mgrs., Chicago.' It also appeared that in October, 1901, complainant filed its bill in the circuit court of the United States for the northern district of Illinois against the Remington-Sholes Company, for alleged unfair trade competition, and that, after answers filed, an order was entered staying proceedings until the determination of this cause, and providing that if this cause resulted in favor of complainant, that cause should be sent at once to an accounting.

On petition of the Howe Scale Company of 1886, and the Fay-Sholes Company, filed October 22, 1903, and on petition of Wyckoff, Seamans, & Benedict, filed December 21, 1903, writ and cross writ of certiorari were granted.

For some years prior to 1860 E. Remington and his three sons were engaged at Ilion, New York in the manufacture of firearms under the firm name of E. Remington & Sons. The father died in 1863, and in 1865 the sons, who had continued the business, organized the corporation E. Remington & Sons under the laws of New York. About 1866 E. Remington & Sons produced a breech-loading rifle that obtained great vogue throughout the world, and was and is known as 'the Remington rifle.' The 'Remington sewing machine' and other machines were also manufactured and sold.

In 1873 E. Remington & Sons began the manufacture of a tpyewriting machine, the most important features of which were invented and patended by Christopher Latham Sholes. It was the pioneer writing machine, and called 'the Typewriter,' and 'the Shoies & Glidden typewriter,' and in 1880 the names 'Remington' and 'Remington Standard' were used instead, as they have since been continuously.

One of complainant's witnesses testified that the typewriter was called 'Remington' 'for the reason that the name Remington was known the world over, owing to their building guns for foreign governments, building sewing machines, and having one of the largest manufacturing works in the world.' In March, 1886, the typewriter branch of the business of E. Remington & Sons was sold to Messrs. Wyckoff, Seamans, & Benedict, and there was also transferred the exclusive right to the name 'Standard Remington Typewriter,' by which name the assignment states the machines were generally known. The assignment contained the express reservation to E. Remington & Sons of the right to engage in the manufacture and sale of typewriters at any time after ten years from its date.

Complainant's typewriting machines have been for years conspicuously marked with the name 'Remington' and with a large 'Red Seal' trademark on the paper table and frame; the name and address 'Remington Standard Typewriter, manufactured by Wyckoff, Seamans, & Benedict, Ilion, N. Y., U.S. A.,' on the cross bar in front of the keyboard; the words and figures 'No. 6 Remington Standard Typewriter No. 6' on the front of the base, and the words 'This machine is protected by 67 American and foreigh patents' on the back. 'Remington' and 'Remington Standard' and the 'Red Seal' have all been registered by complainant as trademarks.

In 1892 Z. G. Sholes, a son of Christopher Latham Sholes, invented a typewriting machine, and early in 1893 the Z. G. Sholes Company was organized under the laws of Wisconsin for its manufacture, but the stock of the company was never issued, and no machine was ever made or sold by it. Later in the year Franklin and Carver Remington, sons of Samuel Remington, formerly president of the E. Remington & Sons corporation, bought a three-fourths interest in Sholes' invention, Sholes retaining one fourth, and a like interest in the stock of the company, paying from eight to nine thousand dollars. They entered into a written agreement with Sholes, which provided, among other things, that 'no further, other, or different business of any kind or nature shall be transacted by said corporation or in its behalf, except that the same may be dissolved, in due form of law, as soon as practicable hereafter.' Franklin Remington gave his entire time to the promotion of the enterprise, and advanced for expenses from six to seven thousand dollars in addition to the original invesment of eight or nine thousand. The name of the machine was subsequently changed by Sholes from 'The Z. G. Sholes' to 'The Remington-Sholes.' Thereafter the Remingtons and Sholes induced Head and Fay of Chicago to furnish funds to manufacture the Remington-Sholes machine; and a corporation organized in the spring of 1894 for its manufacture was designated the 'Remington-Sholes Typewriter Company.' This company purchased tools and machinery, and its typewriting machines were placed on the market in December, 1894. In the fall of 1896 the company had become so deeply indebted that it become necessary to take steps to meet its obligations, and at a meeting of the stockholders December 14, 1896, it was resolved that the property and assets be sold at public auction, the buyer to have the privilege of using all or any part of the company's corporate name. Thereupon Fay purchased in his own name, but as trustee for himself and other stockholders, the whole of the assets of the company, together with its good will, the exclusive right to use its trademarks, etc., and for some months carried on the business at the factory formerly occupied by the Remington-Sholes Typewriter Company. The charter of that company was surrendered in April, 1897, and the Remington-Sholes Company was incorporated under the laws of Illinois, and purchased all the assets, good will, trademarks, trade names, etc., theretofore belonging to Fay and the Remington-Sholes Typewriter Company. And the new company continued at the same factory and through the same instrumentalities to manufacture and sell its typewriters. It was stipulated that the common stock of the new company 'was divided among the stockholders in keeping with the amounts of cash actually invested by them in the Remington-Sholes Typewriter Company, and that the allotment of said common stock to said Franklin Remington was in keeping with such plan.'

The machines made and sold by the Remington-Sholes Typewriter Company were plainly marked with the words 'Remington-Sholes, Chicago.' After the new company entered on the business the trademark 'Rem-Sho' was adopted (registered as a trademark October 19, 1907), and the machines were also marked on the cross bars with the words 'Remington-Sholes Company, Mfrs., Chicago.' The Remington-Sholes Typewriter Company widely advertised that its machine 'was not the Remington Standard typewriter,' and the catalogues circulated by the Remington-Sholes Company declared: 'We state, then, emphatically that this company has no connection whatever with that well-known and excellent machine, the Remington Standard typewriter, and caution possible customers against confusing the 'Rem-Sho' with that machine or any other.'

Messrs. Austen G. Fox, George P. Fisher, Jr., James H. Peirce, and William Henry Dennis for the scale company et al.

[Argument of Counsel from pages 124-129 intentionally omitted]

Messrs. Edmund Wetmore, Henry D. Donnelly, William W. Dodge, Paul Armitage, and Archibald Cox for Wyckoff, Seamans, & Benedict.

[Argument of Counsel from pages 129-134 intentionally omitted]

Mr. Chief Justice Fuller delivered the opinion of the court:

Referring to the Remington-Sholes Company, it was unanimously held by the circuit court of appeals: 'We do not find in this voluminous record sufficient evidence that defendant has itself done anything to promote confusion in the minds of the public, except to use the name 'Remington' on its machines and in its literature.'

Accepting that conclusion, it follows that complainant's case must stand or fall on the possession of the exclusive right to the use of the name 'Remington.'

But it is well settled that a personal name cannot be exclusively appropriated by any one as against others having a right to use it; and as the name 'Remington' is an ordinary family surname, it was manifestly incapable of exclusive appropriation as a valid trademark, and its registration as such could not in itself give it validity. Brown Chemical Co. v. Meyer, 139 U.S. 540, 35 L. ed. 247, 11 Sup. Ct. Rep. 625; ''Singer Mfg. Co. v. June Mfg. Co.'' 163 U.S. 169, 41 L. ed. 118, 16 Sup. Ct. Rep. 1002; ''Elgin Nat. Watch co. v. Illinois Watch Case Co.'' 179 U.S. 665, 45 L. ed. 365, 21 Sup. Ct. Rep. 270.

The general rule and the restrictions upon it are thus stated in Brown Chemical Co. v. Meyer. There plaintiff had adopted as a tradmark for its medicine the words 'Brown's Iron Bitters,' and the defendants used upon their medicine the words 'Brown's Iron Tonic.' This court, after commenting upon the descriptive character of the words 'Iron Tonic,' and confirming the defendants' right to the use of these, said:

'It is hardly necessary to say that an ordinary surname cannot be appropriated as a trademark by any one person as against others of the same name who are using it for a legitimate purpose; although cases are not wanting of injunctions to restrain the use, even of one's own name, where a fraud upon another is manifestly intended, or where he has assigned or parted with his right to use it.'

And, after citing numerous authorities, Mr. Justice Brown, delivering the opinion, continued:

'These cases obviously apply only where the defendant adds to his own name imitations of the plaintiff's labels, boxes, or packages, and thereby induces the public to believe that his goods are those of the plaintiff. A man's name is his own property, and he has the same right to its use and enjoyment as he has to that of any other species of property. If such use be a reasonable, honest, and fair exercise of such right, he is no more liable for the incidental damages he may do a rival in trade than he would be for an injury to his neighbor's property by the smoke issuing from his chimney, or for the fall of his neighbor's house by reason of necessary excavations upon his own land. These and similar instances are cases of damnum absque injuria.'

In ''Singer Mfg. Co. v. June Mfg. Co.'' 163 U.S. 169, 41 L. ed. 118, 16 Sup. Ct. Rep. 1002, the rule is thus laid down by Mr. Justice White: 'Although 'every one has the absolute right to use his own name honestly in his own business, even though he may thereby incidentally interfere with and injure the business of another having the same name. In such case the inconvenience or loss to which those having a common right are subjected is damnum absque injuria. But although he may thus use his name, he cannot resort to any artifice, or do any act calculated to mislead the public as to the identity of the business, firm, or establishment, or of the article produced by them, and thus produce injury to the other beyond that which results from the similarity of name.'

In the present case, the decree enjoined the use, 'in any manner whatsoever,' 'of the designation 'Remington' as the name, or part of the name, of any typewriting machine whatsoever manufactured by the Remington-Sholes Company, or by defendant or any person or concern, and from selling, offering, exposing or advertising for sale by means of signs, show cards, catalogues, circulars, publications, advertisements, or by word of mouth, or in any manner whatsoever, typewriting machines manufactured by said Remington-Sholes Company or by defendant, or any person or concern under the name of or as 'Remington-Sholes,' or by any designation of which the word Remington shall constitute a part.' This denies the right to use the personal name, rather than aims to correct an abuse of that right, and involves the assertion of the proposition that the use of a family name by a corporation stands on a different footing from its use by individuals or firms. But if every man has the right to use his name reasonably and honestly, in every way, we cannot perceive any practical distinction between the use of the name in a firm and its use in a corporation. It is dishonesty in the use that is condemned, whether in a partnership or corporate name, and not the use itself.

''Goodyear's India Rubber Glove Mfg. Co. v. Goodyear Rubber Co.'' 128 U.S. 598, 32 L. ed. 535, 9 Sup. Ct. Rep. 166, was a suit by a corporation of New York against a corporation of Connecticut, to restrain the use in business of the name 'Goodyear's Rubber Manufacturing Company,' or any equivalent name. It was held that 'Goodyear Rubber' described well-known classes of goods produced by the process known as Goodyear's invention; and that such descriptive names could not be exclusively appropriated. And Mr. Justice Field, delivering the opinion, said: 'Names of such articles cannot be adopted as trademarks, and be thereby appropriated to the exclusive right of any one; nor will the incorporation of a company in the name of an article of commerce, without other specifications, create any exclusive right to the use of the name.'

The principle that one corporation is not entitled to restrain another from using in its corporate title a name to which others have a common right, is sustained by the discussion in Columbia Mill Co. v. Alcorn, 150 U.S. 460, 37 L. ed. 1144, 14 Sup. Ct. Rep. 151, and is, we think, necessarily applicable to all names ''publici juris. American Cereal Co. v. Pettijohn Cereal Co.'' 72 Fed. 903, 22 C. C. A. 236, 46 U.S. App. 188, 76 Fed. 372; Hazelton Boiler Co. v. Hazelton Tripod Boiler Co. 142 Ill. 494, 30 N. E. 339; Monarch v. Rosenfeld, 19 Ky. L. Rep. 14, 39 S. W. 236.

It is said that the use of the word 'Remington' in the name Remington-Sholes' was unnecessary,-as if necessity were the absolute test of the right to use. But a person is not obliged to abandon the use of his name or to unreasonably restrict it. The question is whether his use is reasonable and honest, or is calculated to deceive.

'It is a question of evidence in each case whether there is false representation or not.' Burgess v. Burgess, 3 De G. M. & G. 896.

The circuit court of appeals in the present case quotes with approval from the concurring opinion of Wallace, J., in R. W. Rogers Co. v. ''William Rogers Mfg. Co.'' 17 C. C. A. 576, 35 U.S. App. 843, 70 Fed. 1019, that 'a body of associates who organize a corporation for manufacturing and selling a particular product are not lawfully entitled to employ as their corporate name in that business the name of one of their number when it appears that such name has been intentionally selected in order to compete with an established concern of the same name, engaged in similar business, and divert the latter's trade to themselves by confusing the identity of the products of both, and leading purchasers to buy those of one for those of the other. . . . The corporators chose the name unnecessarily, and having done so for the purpose of unfair competition, cannot be permitted to use it to the injury of the complainant.'

This, of course, assumes not only that the name selected was calculated to deceive, but that the selection was made for that purpose.

In Turton v. Turton, L. R. 42 Ch. Div. 128, plaintiffs had carried on the iron business as 'Thomas Turton & Sons.' Defendant began the same business as John Turton, then traded as John Turton & Co., and finally took in his sons and changed the firm name to 'John Turton & Sons.' Some confusion had arisen, and plaintiffs contended that there was no necessity for defendants to use their own names.

Lord Esher said: 'Therefore the proposition goes to this length: That if one man is in business, and has so carried on his business that his name has become a value in the market, another man must not use his own name. If that other man comes and carries on business he must discard his own name and take a false name. The proposition seems to me so monstrous that the statement of it carries its own refutation.'

And Lord Macnaghten said in Reddaway v. Banham [1896] A. C. p. 220: 'I am quite at a loss to know why Turton v. Turton was ever reported. The plaintiff's case there was extravagant and absurd.' And see Meneely v. Meneely, 62 N. Y. 427, 20 Am. Rep. 489; Meriden Brittannia Co. v. Parker, 39 Conn. 450, 12 Am. Rep. 406.

In our opinion the Remingtons and Sholes made a reasonable and fair use of their names in adopting the name 'Remington-Sholes' for their machine, and in giving that name to the corporation formed for its manufacture and sale.

The formation of a corporation as an effective form of business enterprise was not only reasonable in itself, but the usual means in the obtaining of needed capital. And as Wallace, J., said: 'It was natural that those who had invented the machine, and given all their time and means in introducing it to the public, when they came to organize the corporation which was to represent the culmination of their hopes and efforts, should choose their own name as the corporate name. In doing so I think they were exercising only the common privilege that every man has to use his own name in his own business, provided it is not chosen as a cover for unfair competition. They did not choose the complainant's name literally, or so closely that those using ordinary discrimination would confuse the identity of the two names, and that differentiation is sufficient to relieve them of any imputation of fraud.'

The name 'Remington-Sholes Company' is not identical with, or an imitation of, 'Remington Standard Typewriter Company,' or 'Remington Typewriter Company,' or 'E. Remington & Sons.' Defendant's marks 'Rem-Sho,' 'Remington-Sholes Co., Mgrs., Chicago.' are not identical with, or an imitation of, complainant's marks 'Remington;' Large Red Seal; 'Remington Standard Typewriter, manufactured by Wyckoff, Seamans, & Remington, Ilion N. Y., U.S. A.;' 'Remington Standard Typewriter.'

The use of two distinct surnames clearly differentiated the machines of defendant from those of complainant, and when defendant's cards, signs, catalogues, instructions to agents, etc., are considered, it seems to us that the record discloses, to use the language of Mr. Justice Field in the Goodyear Case, a persistent effort on defendant's part 'to call the attention of the public to its own manufactured goods, and the places where they are to be had, and that it has no connection with the plaintiff.' Doubtless the Remington and Sholes, in using the name 'Remington-Sholes,'desired to avail themselves of the general family reputation attached to the two names; but that does not in itself justify the assumption that their purpose was to confuse their machines with complainant's; or that the use of that name was in itself calculated to deceive. Remington and Sholes were interested in the old company, and Remington continued as general manager of the new company. Neither of them was paid for the use of his name, and neither of them had parted with the right to that use. Having the right to that use, courts will not interfere where the only confusion, if any, results from a similarity of the names, and not from the manner of the use. The essence of the wrong in unfair competition consists in the sale of the goods of one manufacturer or vendor for those of another; and if defendant so conduct its business as not to palm off its goods as those of complainant, the action fails.

As observed by Mr. Justice Strong in the leading case of Delaware & H. Canal Co. v. Clark, 13 Wall. 311, 20 L. ed. 581, 'Purchasers may be mistaken, but they are not deceived by false representations, and equity will not enjoin against telling the truth.' And by Mr. Justice Clifford, in McLean v. Fleming, 96 U.S. 245, 24 L. ed. 828: 'A court of equity will not interfere when ordinary attention by the purchaser of an article would enable him at once to discriminate the one from the other.' And by Mr. Justice Jackson in Columbia Mill Co. v. Alcorn, 150 U.S. 460, 37 L. ed. 1144, 14 Sup. Ct. Rep. 151: 'Even in the case of a valid trademark the similarity of brands must be such as to mislead the ordinary observer.' And see Coats v. Merrick Thread Co. 149 U.S. 562, 37 L. ed. 847, 13 Sup. Ct. Rep. 966; Liggett & M. Tobacco Co. v. Finzer, 128 U.S. 182, 32 L. ed. 395, 9 Sup. Ct. Rep. 60.

We hold that, in the absence of contract, fraud, or estoppel, any man may use his own name, in all legitimate ways, and as the whole or a part of a corporate name. And, in our view, defendant's name and trademark were not intended or likely to deceive, and there was nothing of substance shown in defendant's conduct in their use constituting unfair competition, or calling for the imposition of restrictions lest actionable injury might result, as may confessedly be done in a proper case.

Decree of Circuit Court of Appeals reversed; decree of Circuit Court also reversed, and cause remanded to that court, with a direction to dismiss the bill.