Under the common law and the federal registration statute
(February 20, 1905, c. 592, 33 Stat. 724), a trademark for one
variety of goods include other varieties of the same species.
An adjudication that, as against B, A is entitled, by prior
appropriation,
Page 246 U. S. 313
to use a trademark on "blended" whiskey, protects A, as against
B, in its use on "straight" whiskey.
G, claiming a trademark by prior adoption and use and by
registration under the Act of February 20, 1905,
supra, in
connection with the manufacture in Kentucky and extensive sale of
"straight" whiskies, sued R to enjoin the use of the mark on
"straight" whiskey manufactured in that state. R, claiming to be
acting as the agent of H, set up in bar a decree of the circuit
court in Missouri, directed by the circuit court of appeals,
dismissing the bill in a former suit brought by G against the
predecessors of H to enjoin them from using the same mark on
"blended" whiskey, which they had been producing and selling under
it in a limited way at St. Louis.
Held, reviewing the
pleadings in the former case and the findings and conclusions of
the circuit court of appeals as displayed in its opinion, (1) that
the issues as to the common law right were the same in both cases,
(2) that the former decree established against G, in favor of the
predecessors of H, a title by prior appropriation, and not merely a
defensive right limited to the type of whiskey ("blended") they
were selling and to the volume and territorial extent of their
trade in it when the former bill was filed, (3) that this
adjudication enured to R by privity, and (4) barred the subsequent
suit, notwithstanding the latter related to whiskey of another type
-- "straight" whiskey -- and notwithstanding the subsequent
registration of the trademark by the plaintiff for "straight"
whiskey under the federal act.
226 F. 531, reversed.
This is a bill in equity brought by the Gaines Company against
the Rock Spring Company to restrain the latter from using the
trademark of the former. The trademark is registered and is
employed by the Gaines Company to designate a brand of straight rye
or straight bourbon whisky manufactured by that company.
The following are the facts of the bill stated narratively: the
Gaines Company is the owner of a whisky distillery in Woodford
County, Kentucky, known and named as the Old Crow Distillery. It is
the only one in the state that is or ever has been designated by
the name of "Crow" or "Old Crow."
Its product has been at all of the times mentioned in
Page 246 U. S. 314
the bill straight rye and straight bourbon whisky, and to it
there has at all times been applied the trademark consisting of the
words "Old Crow" by being imprinted or branded on the wooden box
containing the whisky and imprinted upon labels affixed to bottles
containing the whisky. The trademark is now and for many years past
has been used by the company and its predecessors in commerce among
the states.
On February 26, 1909, it filed in the Patent Office, in
pursuance of the Act of February 20, 1905, 33 Stat. 724, in due
form and under the conditions required, an application for
registration of the trademark and a certificate of registration for
the same was duly issued and for many years past has been used by
the company as a trademark for its straight rye and straight
bourbon whisky.
The Gaines Company, availing itself of certain acts of Congress,
began and has ever since maintained the bottling of the "Old Crow"
in bond, and it was then and has ever since remained the only "Old
Crow" whisky bottled in bond and has an extensive sale throughout
the United States and in foreign countries, and when so bottled in
bond, it is known as and called "Old Crow Bottled in Bond," is so
marked, and commands a high price.
The Rock Spring Company is a corporation, has a distillery in
the County of Daviess, Kentucky, and is the owner of a distillery
situated therein known as Distillery No. 18, operated by Silas
Rosenfield, one of the defendants.
The Rock Spring Company, in fraud of the Gaines Company's rights
and in infringement of its trademark, made or caused to be made and
sold or caused to be sold in Kentucky a certain spurious straight
bourbon whisky, not the product of the Gaines Company, and branded
the same with the words "Celebrated Old Crow
Page 246 U. S. 315
Whisky Bottled in Bond," have caused the same to be bottled in
bond, have applied to the labels thereon the words "Old Crow" in
script type, and have caused the same to be sold and transported in
interstate commerce, and this with the intent to mislead and
deceive the public, and are doing so and will continue to do so
unless restrained.
An injunction is prayed, and an accounting.
Demurrers were filed by the Rock Spring Company and Rosenfield,
which were overruled, and they then answered, pleading a prior
adjudication based upon the following alleged facts: a suit was
brought in the United States Circuit Court for the Eastern Division
of the Eastern District of Missouri by W. A. Gaines & Company
against Abraham M. Hellman and Moritz Hellman charging infringement
of the trademark and unfair competition. The bill was subsequently
amended making Max Kahn, administrator with will annexed of the
estate of Abraham M. Hellman, deceased, a party to the suit. Upon
the issues framed, a decree was entered in favor of the
complainants, an injunction granted, and an accounting ordered.
The decree was reversed by the United States Circuit Court of
Appeals for the Eighth Circuit with directions to dismiss the bill
on the ground that the evidence clearly showed that the
predecessors in business of the appellants therein had adopted the
words "Old Crow" as a trademark for whisky as early as the year
1863 and the evidence failed to show that the predecessors of the
Gaines Company had used the words as a trademark prior to the year
1870.
A petition for certiorari to review the decision was denied by
the Supreme Court of the United States.
Other proceedings were had in the suit pending its appeal and
afterward. The suit, however, was finally dismissed on the merits
because of the decision of the
Page 246 U. S. 316
court of appeals and the action of the Supreme Court of the
United States.
Defendants are in privity with the parties recovering under
those decisions and decrees, and are manufacturing whisky under
contracts of agency from them or their successors and neither have
nor claim any right except through such contract.
The Hellman Distilling Company filed a petition to be permitted
to intervene, which was denied, 179 F. 544.
After hearing, a decree was entered sustaining the plea of
former adjudication based on the decree of the District Court for
the Eastern District of Missouri, and accordingly and for that
reason, the bill of complaint, so far as it sought relief for any
infringement of the trademark "Old Crow" in connection with its use
on whisky, was dismissed. And it was further decreed that the
registration of the trademark July 20, 1909, could not and did not
invalidate or nullify the estoppel.
The decree was reversed by the circuit court of appeals, and
thereupon this certiorari was applied for and allowed.
MR. JUSTICE McKENNA, after stating the case as above, delivered
the opinion of the Court.
The decree of the District Court for the Eastern District of
Missouri, directed by the decision of the United States Circuit
Court of Appeals for the Eighth Circuit,
Page 246 U. S. 317
is pleaded in bar, and whether it is such depends upon the
issues that were made or passed upon in those courts.
The bill of complaint in the case alleged that, in 1835 one
James Crow (he is the James Crow of this suit) invented and
formulated a novel process for the production of whisky which he
did not patent or seek to patent, but kept for his own use until
his death in 1855.
During all of the time after 1835, the whisky so produced was
known and styled as "Old Crow" whisky and the designation was
adopted and used as a trademark.
After the death of Crow, one William F. Mitchell, to whom Crow
had communicated his secret process, continued the distillation so
designated, and in 1867, a partnership, styled Gaines, Berry &
Co., obtained possession of the distillery wherein the whisky
distilled by the indicated process continued to be produced by the
same process until the partnership was succeeded by W. A. Gaines
& Co., and the latter company succeeded also to all of the
partnership assets of the other and continued to produce the whisky
until the incorporation of the complainant, when all these assets
were acquired by it.
When the name "Old Crow" was applied by Crow, it was a valid
trademark, and, since its adoption, it has always been applied to
the whisky produced by the indicated secret process, and since that
time has indicated to the public whisky distilled on Glenn's Creek,
in Woodford County, Kentucky, and nowhere else.
Complainant caused the same to be registered in the Patent
Office under the provisions of the act of Congress so providing.
The value of the trademark is $500,000, and an integral part of the
goodwill of complainant's business and the whisky is of greater
value than any other of equal age.
Since January, 1903, the defendants, in violation of
complainant's rights and goodwill, have made or caused
Page 246 U. S. 318
to be made and sold in the City of St. Louis a certain
spirituous or alcoholic fluid not made under complainant's process
and have labeled it with the words "Old Crow" without license from
the complainant and against its consent. Such unlawful use will
greatly lessen the value of complainant's business and goodwill,
and complainant is without adequate remedy at law.
There was the usual prayer for an accounting and an
injunction.
There was a supplemental bill to the same effect, but charging
that A.M. Hellman & Co. had become the successors of the
original defendants and had continued the acts alleged in the
original bill.
To the bill the defendants answered with denials, and alleged
the use of the word "Crow," "Old Crow" and "J. W. Crow" in
connection with their own business upon packages of whisky and in
their and their predecessor's business from 1863 and prior thereto;
that the whisky sold by complainant was an unrefined, harmful, and
deleterious article, and that the whisky sold by them was a brand
largely free from impurities.
The defendants also filed a cross-bill which, however, was not
insisted upon.
These, then, were the issues, and upon them and the evidence
adduced to sustain them the Circuit Court entered a decree
establishing complainant's right to the word "Old Crow" as a
trademark, enjoined the use thereof by defendants, and found them
guilty of unfair competition in business and ordered an accounting.
The circuit court of appeals reversed the decree.
The latter court made a careful review of the evidence,
denominating it a mass of the relevant and irrelevant, and felt
that it was not necessary to consider the comparative excellence of
the whiskies, and remarked that the evidence did "not show that
Glenn's Creek in any way entered into the composition of the
whisky" and that
Page 246 U. S. 319
"there was no secret about the process employed by Crow, nor did
it differ materially from that employed by every other distiller of
the same period." To the objection that the "designative words"
were rarely used by the Hellmans and that their product was of
inferior quality, the court replied that the right to use could not
be measured by the extent to which the Hellmans employed it,
"whether more or less frequently," nor
"by the overshadowing comparative amount of the complainant's
[Gaines & Co.'s] sales under the designation 'Old Crow' whisky,
nor by asserted superiority of its product."
The court concluded as follows:
"(1) That, inasmuch as the defendants' predecessors in business
prior to the use or the adoption of the designative word 'Crow' or
the words 'Old Crow' as a trademark, employed those words in
descriptive terms in connection with their business as dealers in
whisky in St. Louis, Mo., and said predecessors and the defendants
so continued to use the same, to a limited extent, up to the time
of the institution of this suit, in good faith, they are not guilty
of infringing the complainant's claimed trademark, and (2) that the
defendants are not guilty of having engaged in unfair competition
with the complainant in the prosecution of their business."
It will be observed that the issues in that case were the same
as those in the present case as to the right to the use of the word
"Crow" with any of its qualifications. But, in this case, there is
another ground of recovery alleged -- that is, the application for
and the receipt of the certificate of registration for the word as
a trademark for straight rye and straight bourbon whisky. The
district court, however, adjudged that the decree of the Circuit
Court in Missouri and its affirmance by the circuit court of
appeals constituted a bar to this suit. To the judgment of the
circuit court of appeals of the
Page 246 U. S. 320
Sixth Circuit, reversing the action of the district court, this
certiorari is directed.
The circuit court of appeals, however, did not yield to all of
the views of the Gaines Company. It refused to decide, as urged to
do, that the defendants in this suit were not in privity with the
defendants in the other, and it rejected the contention that the
use of the trademark established in the Hellman Company for a
blended whisky was not an adjudication of the right to use it upon
a straight whisky. In the rulings on both contentions we concur.
The first needs no comment; we adopt that of the court on the
second. The court said that
"whatever the extended classifications and subclassifications of
the Patent Office practice may contemplate, neither the common law
nor the registration statute can intend such confusion as must
result from recognizing the same trademark as belonging to
different people for different kinds of the same article.
Established trademarks directly indicate origin, but if they have
any value, it is because they indirectly indicate kind and quality,
and to say that the seller of a blended whisky might properly put
upon it a mark which was known to stand for a straight whisky, or
vice versa, would be to say that he might deceive the public not
only as to the origin, but also as to the nature and quality, of
the article."
The philosophy of this might be questioned. But it seems to have
become established, and, however it may be disputed in reason,
there is an opposing consideration. As said by Circuit Judge
Sanborn in
Layton Pure Food Co. v. Church & Dwight
Co., 182 F. 35, 39: "Uniformity and certainty in rules of
property are often more important and desirable than technical
correctness."
And this reasoning prevailed with the circuit court of appeals
which, after citing cases, said that it was forced to think "that
whatever was adjudicated regarding
Page 246 U. S. 321
complainant's title to the trademark applies to its use of both
kinds of whisky." And, of course, conversely, we may say that
whatever was decided against its title to its trademark applies to
its use on both kinds of whisky. In other words, if defendants were
adjudged to have title to the words "Crow" or "Old Crow" on blended
whisky, they have a right to use it on straight whisky without
infringing any right of complainant. We came back, therefore, to
the question as to what was adjudged in the prior suit.
To this question the Court of Appeals of the Sixth Circuit gave
great care, and, in an opinion of strength, decided the negative of
it. The court, in concession to the argument, assigned a prior use
to the Hellmans, but expressed the view that the existence of such
"general or
prima facie exclusive right is not
inconsistent with an inability to enforce it against some persons
and under some circumstances." And it was added:
"Instances may arise where the affirmative conduct or the laches
of the first appropriator, and with reference to what he was at
first entitled to call an infringement, has been such that, on the
principles of estoppel or the rule of laches, a court of equity
cannot tolerate that he should enforce against the later user the
right which might have been originally perfect. . . . Under these
considerations and upon reference to the pleadings and the proofs
in the
Hellman case, we conclude that the latter case is
of the class where the refusal to give an injunction to the first
appropriator of the mark may be justified upon the ground of his
laches or estoppel, and so this ground of support must be
considered in determining what is the true basis of that
decree."
The court hence concluded that it, the decree, did not adjudge
title to the Hellmans, but adjudged them a "defensive right, and
nothing more," and, explaining the right, the court said that
it
"does not extend to any whisky
Page 246 U. S. 322
not mixed or blended so as to be of the same general type as
that to which defendants [Hellmans] had been making or to trade or
territory in which they were not selling when the bill was
filed."
We are not able to assent. The court admitted that the language
in the body of the opinion of the Circuit Court of Appeals for the
Eighth Circuit is consistent with the interpretation petitioners
put upon it -- that is, "that the trademark, in its general,
prima facie, affirmative aspect, belonged to the Hellman's
prior appropriation;" but the court added that the last paragraph
of the opinion indicated "that the two judges (only two sitting)
did not unite in putting the decision on that ground." We think
this was an oversight. The opinion was that of the court, though
delivered by one judge, and the conclusion was the conclusion of
the court, and necessarily had to be, else there would have been no
decision or decree. And it was thoroughgoing. It is manifest from
the excerpts we have made from the opinion that the judgment of the
court was not limited as to time or territory; nor did the
pleadings so limit it. The complainant in that case (respondent
here) alleged that it was the sole and exclusive owner of the
trademark and had used it from 1835 to the present time, being
virtually the successor of the first producer of the product.
Defendants (petitioners) contested the claim and asserted a
right in themselves based on prior adoption and continuous use, and
that right was adjudged to them.
Decree of the circuit court of appeals reversed, and that of
the district court affirmed.
