G. Heileman Brewing Co. v. Independent Brewing Co.

WOLVERTON, District Judge

(after stating the fact's as above). [1] The appellee insists at the outset that the hill of complaint states .a cause of suit for the infringement of a trade-mark only, and not at all for unfair competition in trade. In this we think counsel is in error. A suit for unfair competition may be maintained where there is no lawful trade-mark involved, which consists essentially in palming the goods of one manufacturer or vendor off for the goods of another. This is a fraud not only upon the manufacturer whose goods are assimilated and replaced in the market, but upon the general public as well, which does not get what it supposes it is bargaining for. For the fraud thus perpetrated, the individual or the manufacturer, as the case may be, has his or its cause of suit to prevent the recurrence of the imposition, and for such damages as may have been sustained on account of it. Lawrence Mfg. Co. v. Tennessee Mfg. Co., 138 U. S. 537 , 11 Sup. Ct. 396, 34 L. Ed. 997 ; Elgin Nat. Watch Co. v. Illinois Watch Co., 179 U. S. 665 , 21 Sup. Ct. 270, 45 L. Ed. 365 ; Draper v. Skerrett (C. C.) 116 Fed. 206 . A fortiori a suit may be maintained for unfair competition when the infringement of a trade-mark is resorted to as a means of accomplishing the purpose. As is said in the books, “Trade-mark infringment is but one form of unfair competition.” Hopkins on Trade-Marks, 44. In such a case it is altogether appropriate that the party claiming to be injured should conjoin allegations of infringement with averments of unfair competition. Indeed, he could not well state his case otherwise. There can be no objection,, therefore, to joining the two causes of suit in one com *493 plaint, and it is true also that he might succeed in one cause alone and fail in the other. By fair intendment the complaint in the present cause combines both elements of fraud, infringement, and unfair competition in trade. This appears sitfficiently by such allegations as “that said beer is purchased and designated by the purchasing public by the said mark and label appearing upon said beer,” and that the defendant “has used upon such (the defendant’s) beer in connection with the sale of the same your orator’s trade-mark in so nearly the exact form and configuration as employed by your orator as to deceive purchasers into believing that the beer the manufacture of the defendant was and is the beer manufactured by your orator, and to confuse and defraud the public into purchasing the defendant’s beer believing it to be the beer of your orator,” and further:

‘•That the defendant continues to unlawfully interfere with and divert your orator's business and the profits threfrom to its own use and behoof, and tha t tile public lias been and continues to be misled, and that the beer the manufacture of defendant has been and continues to be sold as and for the true and genuine beer of your orator’s manufacture for many years known and In demand as hereinbefore set fortli, and that the use by defendant of <he said infringing mark, of your orator and of his peculiar configuration thereon lias the effect of enabling and promoting the impairment of the reputation of and the demand for your orator’s beer, and the fraudulent; and unlawful sale and substitution of the defendant’s beer as and for the beer of your orator’s manufacture, to your orator’s great loss and injury and to the great loss and injury of the public.”

[2] It is next insisted that the complaint shows on its face that the plaintiff has been continuously perpetrating a fraud upon the public by holding out that its label has been copyrighted. The copy of the complainant’s label attached to the complaint contains the words printed upon its face at the lower-right hand corner thereof in small type. “Copyright 1902 G. Heileman Brewing Co.” Nothing is contained in the complaint respecting the copyright, nor is anything claimed because of the fact that the label was in reality copyrighted. It is quite true that the trade-mark relied upon, and which is claimed to be infringed, if it contains misrepresentations misleading to the public, cannot be made the basis of relief in equity. Thus, when it is the object of the trade-mark to indicate the origin of manufactured goods, and a person affixes to goods of his own manufacture a trade-mark which represents that they are the manufacture of some other person, the representation operates as a fraud upon the public which equity will not countenance. Manhattan Medicine Co. v. Wood, 108 U. S. 218 , 2 Sup. Ct. 436, 27 L. Ed. 706 . To the same effect is Connell v. Reed, 128 Mass. 477 , 35 Am. Rep. 397 . The principle, however, has no application to counsel’s contention, for if it may be said that the words “Copyright 1902 G. Heileman Brewing Co.” misrepresent the fact, and there is nothing to show that tliev do, no one, neither the public nor any individual, could be misled to its or his injury thereby. They in no way contain any representation touching the goods which the label is designed to designate.

[3] It is next urged that no suit can be maintained because the registered label or trade-mark does not have affixed thereto the words “Registered in the United States Patent Office/’ or the abbreviation *494 “Reg. U. S. Pat. Off.,” as required by statute. • Section 28 of the Act of Congress of February 20, 1905, c. 592, 33 Stat. 730 (U. S. Comp. St. Supp. 1909, p. 1286). This statute imposes the duty upon the registrant to give notice to the public of registration by affixing upon .the registered trade-mark the words or abbreviation above denoted, and it provides that no damages shall be recovered in any suit for infringement by a party failing to give such notice as provided, except on proof that the defendant was duly notified of infringement and continued the same after such notice. The averments of the complaint are ample to let in proof under the exception, and this disposes of the contention without further interpretation of the statute.

[4] In the same relation it is further urged that:

“The claim to a trade-mark of a label is void if the label is published- before it is registered as a trade-mark” — citing Bump on Patents and TradeMarks (2d Ed.) p. 502, and notes.

This authority is not at present accessible ; but, whatever may be its text, in, this country a trade-mark is acquired by use, and the use must antedate registration. Without it registration cannot be had. By section .1 of the act of February 20, 1905, supra, the owner of a trademark domiciled in this country is entitled to have the same registered, and by section 2, in order to procure registration, he must show that such trade-mark is used in commerce among the several states or within foreign, countries. So that registration comes only after acquirement of the right to a trade-mark by use. See, also, Hopkins on Trade-Marks, §§ 25-27. The complaint shows user prior to registration. If that be publication, complainant did only what the statute required of it. The objection is untenable.

[5] The last and cardinal contention is that the label used by the defendant is not an infringement upon complainant’s trade-mark. A simple inspection of the two labels, as shown by Exhibits A and C at-, tached to the complaint, convinces one that the defendant’s label was suggested by that of complainant, which latter consists essentially, as is alleged in the complaint, of a conventional or typical Dutch or German scene, and the situation is really resolved into the question whether the defendant has so differentiated its label in the manner of its design and detail of execution as to avoid infringement of complainant’s label. There is a manifest effort at artful simulation to be attended with barely sufficient differentiation to escape infringement. Has the defendant succeeded, and does the complaint so show upon its face?

Some reference to the authorities will aid us in the solution. McLean v. Fleming, 96 U. S. 245 , 24 L. Ed. 828 , is a leading case upon the subject. The court there says:

“Much must depend, in every case, upon the appearance and special characteristics of the entire device; but it is safe to declare, -as a general rule, that exact similitude is not required to constitute an infringement or to entitle the complaining party to protection. If the form, mark, contents, words, or the special arrangement of the same, or the general appearance of the alleged infringer’s device, is such as would be likely to mislead one in the ordinary course of purchasing the goods, and induce him to suppose that he was purchasing the genuine article, then the similitude is such as entitles the *495 injured party to equitable protection, if he takes seasonable measures to assert his rights, and to prevent their continued invasion. * * *

“Colorable imitation,, which requires careful inspection to distinguish the spurious trade-mark from the genuine, is sufficient to maintain the issue; but a court of equity will not interfere, when ordinary attention by the purchaser of the article would enable him at once to discriminate the one from the other. Where the similarity is sufficient to convey a false impression to the public mind, and is of a character to mislead and deceive the ordinary purchaser in the exercise of ordinary care and caution in such matters, it is sufficient to give the injured party a right to redress, if he has been guilty of no laches. * * *

“Two trade-marks are substantially the same in legal contemplation, if the resemblance is such as to deceive an ordinary purchaser giving such attention. to the same as such a purchaser usually gives, and to cause him to purchase the one supposing it to be the other.’’

The lower federal courts have uniformly announced the principle in numerous cases. In Enoch Morgan’s Sons Company v. Hunkele, Fed. Cas. No. 4,493 it is said;

“It is not a question whether the defendant has in all respects imitated the trade-mark of the complainant, but whether he has so imitated it that the purchaser has been imposed upon.”

So in Shaw Stocking Co. v. Mack (C. C.) 12 Fed. 707 , the court affirms:

“It is not necessary that the resemblance produced should he such as would mislead an expert, nor such as would not be easily detected if the original and the spurious were seen together. It is enough that such similitmle exists as would lead an ordinary purchaser to suppose that he was buying the genuine article and not an imitation.”

And again, in Cantrell & Cockrane v. Butler (C. C.) 124 Fed. 290 , the court says:

“Conformity of one label to another sufficiently to attract and deceive is not excused by ability to analyze the offending label and point out differences, which if known and recognized would avoid confusion. The ensemble does the mischief; the usual purchaser neither abstracts nor analyzes for the purpose of diferentiation and judgment.”

To the same purpose is Eagle White Lead Co. v. Pflugh (C. C.) 180 Fed. 579 , where the court says:

“The question of infringement is to be determined by the test of domina ncy. The dissimilarity in size, form, and color of the label and the place where applied are not conclusive. Tf the competing label contains the trade-mark of another, and confusion or deception is likely to result, infringement takes place, regardless of the fact that the accessories are dissimilar. Duplication or exact imitation is not necessary; nor is it necessary that the infringing label should suggest an effort to imitate.”

In Kostering v. Seattle Brewing Co., 116 Fed. 620, 621 , 54 C. C. A. 76, 77 , this court said:

“It is argued, and it is true, that the differences are apparent to any one who will read and examine the labels; but that argument does not meet the ■question which the case presents: Are the resemblances between the two labels such that the consumer is likely to be misled?”

And again, in Keuffel & Esser Co. v. H. S. Crocker Co. (C. C.) 118 Fed. 187 , 189:

“While the words alone, if considered apart from the label as a whole, might not be deemed to present so close a resemblance as to constitute in *496 fringement, when connected with the associated lettering and general design, and forming a part of a label almost identical in size, shape, coloring, and lettering'with that of the complainant applied to similar goods, it is very clear that the mind of the purchaser would readily he deceived by the similarity, and be quite as easily induced to purchase the goods of one as the other.”

And in stating the law applicable, the court further said:

“It requires the defendant, in offering his goods to the public, to use such method of wrapping, labeling, and cataloguing of his packages as not to lead an intending purchaser, of ordinary intelligence, using ordinary care, into the mistaken belief that he is purchasing goods placed upon the market by the complainant, when in fact he is purchasing the defendant’s goods.”

[6] A comparison of the alleged infringing label with complainant’s label will show striking features of distinct similarity among others less conspicuous that bear less or no resemblance. Both labels were undeniably designed to represent a typical- Dutch or German scene. Each contains in representation an inn with people drinking at a table outside. The inn occupies the upper center of the defendant’s label, back of which appears the brewery of the manufacturer, while in complainant’s it occupies the upper right-hand side. Immediately beneath the representation of the inn in each label is a subterranean or underlying recess or room containing three barrels or casks; there being printed i:n German .type on the heads of these, as shown by complainant’s label, “Old Style Eager,’’ and on the defendant’s, “Old German Eager.” On the complainant’s label two persons, one with receptacle in hand, are passing by, while at the right are two workmen coopering a barrel, and at the left three monks at table drinking. On the defendant’s label are represented four monks seated at a table in front of the casks or barrels in the subterranean way, and at the left in the lower left-hand corner are two artisans coopering a barrel. On the complainant’s label is represented a boiling kettle in another underljdng passage, with two brewers attending it. This appears a little below the center .of the scene, and another kettle is seen to the left hanging on a support over a fire, apparently unattended. Below this latter is represented a Bacchanalian scene. On the left margin of defendant’s label is represented a kettle over a fire, not hanging, with persons about it apparently filling the kettle with ingredients, while above in the upper left-hand corner are two men at a tank stirring the brew. The Baccahnalian scene is not represented on this label. On the complainants’ label may be seen also a man on horseback, he drinking from a mug and the horse from a watering trough in which is- flowing water gushing from the rocks; this at the right of the scene; and in the center is found an ox cart to which are yoked a pair of oxen, while within the cart is a man drinking from a mug, and a man by the side of the cart waiting upon him. On defendant’s label are represented at the lower right-hand corner a husbandman pitching hay or provender of some kind; above that, near the right center, a man plowing with a joke of oxen; and still above, in the upper right-hand corner, women apparently gathering hops in a hop field. The complainant’s label shows a sign hanging from a scroll attached to the cornice of the inn, with the words “Old Style Lager” printed thereon in German type, and the defendant’s sign hanging above the inn from a scroll attached tq a *497 standard with the words “Old German Lager” printed thereon in German type. Across the left margin of the complainant’s label are printed the words “Brewed and Bottled by G. Heileman Brewing Co., La Crosse, Wis.,” and some German script is found at the top, to the left of the center. On the defendant’s label in the center at the bottom is written “Brewed and Bottled by the Independent Brewing Co.,” the name of the firm appearing in German type, and below that: “Seattle, Wash. Guaranteed by the Independent Brewing Co. under the Food and Drug Act, June 30. 1906” — all in English type. There are other minor features pertaining to the labels, but not of peculiar moment. The complainant’s label shows green in its general tone, with drab and light orange shading for the buildings, stone walls, and scenery about. The defendant’s label, the same as attached to the complaint, appears in its general tone a light olive green shaded to a light orange; the shading. bearing some resemblance to that of the complainant’s.

Now, to one scanning the detailed description of these two Dutch scenes, or laying the pictures side by side, there could be no trouble in distinguishing the one from the other. But this is not the test. Will confusion result to the purchasing public by the use of the two not brought into direct or special comparison? Would the ordinary customer applying at the counter for “Old Style Lager,” observing the care customary with purchasers in that way, be likely to be deceived or misled into buying “Old German Lager,” if it was offered him marked with defendant’s label ? We are impressed that he would.

A simulation of the most prominent and distinctive features of the complainant’s label is found in the defendant's label. The inn is there, with the legend in slightly different wording suspended from a scroll; the representation of men drinking at a table outside of the inn is there; the barrels or casks in the subway arc there; the monks drinking at a table at or near the casks are there; and the coopering of a barrel is there. In short, the “ensemble” is there, and that, says the court in Cantrell & Cockrane v. Butler, supra, does the mischief. And quoting again:

“The usual purchaser neither abstracts nor analyzes for the purpose oí differentiation and judgment.”

The complaint, fairly construed, we think, shows infringement upon the face of it. What the evidence may show at the trial is quite a different thing.

The judgment of the Circuit Court will therefore be reversed, and the cause remanded, with direction to overrule the demurrer.