Eastern Outfitting Co. v. Manheim , 1910 Wash. LEXIS 1219 ( 1910 )

Gose, J.

The plaintiff brought this action to enjoin the-defendants from using the name “Eastern Outfitting Company.” There was a decree in favor of the defendants, enjoining the plaintiff from using the name in the city of Spokane. The plaintiff has appealed.

Appellant is a foreign corporation, organized in the state of California under the name of “Eastern Outfitting Company of Seattle, Washington.” In March, 1902, it filed for record in the office of the secretary of state of this state a certified copy of its articles of incorporation, and otherwise complied with the laws of this state respecting foreign corporations doing business here. The essential facts are that the appellant, since 1902, has been engaged in the business of selling “cloaks and suits, also gents’ clothing,” in the city of Seattle, and its vicinity. Its mode of doing business, as testified by its manager, has been to sell on credit, receiving a cash payment of a few dollars at the time of the sale, and weekly or monthly payments thereafter until the purchase price is paid. It did no business in the eastern part of the state, aside from a single transaction with one customer who had moved from Seattle to Spokane. It has, in addition to its local trade, a mail order business in the territory adjacent to Seattle. The respondents were at one time copartners, doing a retail mercantile business in the city of Spokane under the name of “Eastern Outfitting Company.” The business was started under this name by the respondent J. Manheim, in April or May, 1905. Later he associated Xathan Manheim with him in the business and, before the commencement of the action, the latter acquired the entire ownership, and continued to conduct the business in the old name. There is no evidence that the respondents had any trade outside of the city of Spokane. About August, 1909, the appellant undertook to open a place of business in Spokane under the name of “Eastern Outfitting Company,” and advertised that it had an exclusive right to the use of that name.

The court found, that the business of both the appellant and the respondents is a retail installment business, purely local in character; that the respondents have expended large sums of money in advertising the business, and have established a large cash and installment business under their trade-name; and that in August, 1909, the appellant, with the intention to cheat and defraud the respondents and the public, sought to lure the public into its place of business in the city of Spokane by taking the respondents’ trade-name, and thus divert and appropriate their business. The findings are supported by the evidence.

The appellant contends that it has the exclusive right to the use of the name “Eastern Outfitting Company” throughout the state, because of its compliance with the laws of the state with respect to foreign corporations. We cannot concur in this view. The respective parties adopted the same trade-name and engaged in the same general business, but at points remote from each other, and they are to be dealt with precisely as if the names were those of private firms or copartnerships. Celluloid Mfg. Co. v. Cellonite Mfg. Co., 32 Fed. 94.

“No advantage accrues to a name of a corporation because it is borne by a corporation.” Nims, Unfair Business Competition, page 198.

The appellant next urges that, upon the principle of unfair business competition, the respondents should be enjoined from the further use of the trade-name. This position is untenable. In considering this question it is essential that the distinction be kept in mind between a trade-name as applied to a local business and a trade-name as applied to a general business. In Martell v. St. Francis Hotel Co., 51 Wash. 375, 98 Pac. 1116, speaking to the identical question, we said:

“The general rule is, as before quoted, that one person may not use the name of another already in the same line of business so that confusion or injury results therefrom.”

This principle, stated in varying phraseology, may be found both in the text books and in the adjudged cases. In cases like the one at bar the fact to be ascertained is, what is the market of the complaining party. His protection is coextensive with his market. Nims, § 114. “But there is no standard, except what the court in each particular case believes has worked fraud, or may work fraud or loss to the plaintiff.” Nims, § 108. There cannot be unfair trade competition unless there is competition. Sartor v. Schaden, 125 Iowa 696, 101 N. W. 511.

The doctrine of unfair competition is based upon the pi’inciple of common business integrity, and equity only affords relief when this principle has been violated. Hainque v. Cyclops Iron Works, 136 Cal. 351, 68 Pac. 1014; Sartor v. Schaden, supra. The mischief which a court of equity will guard against is a confusion in names, or in the identity of parties, or in the goods sold, so as to deceive the public and work a fraud upon the party having a right to the trade-name. Philadelphia Trust, Safe Deposit & Ins. Co. v. Philadelphia Trust Co., 123 Fed. 534; Celluloid Mfg. Co. v. Cellonite Mfg. Co., supra; Blackwell’s Durham Tobacco Co. Co. American Tobacco Co., 145 N. C. 367, 59 S. E. 123; Cohen v. Nagle, 190 Mass. 4, 76 N. E. 276, 2 L. R. A. (N. S.) 964.

It is manifest that the respondents, doing a retail business in Spokane, could not pass off their goods as the appellant’s goods, or pass themselves off as the appellant. The respondents did not invade the appellant’s territory but, on the other hand, it sought to invade their territory after they had devoted years of time and labor to giving a reputation to the name in the city of Spokane. Before the appellant attempted to open a business in Spokane, there had been no confusion and no deception practiced upon the public or the appellant’s customers. We have treated the question as if the parties had used the same trade-name, and have given no consideration to the fact that the words “Seattle, Washington,” were a part of the corporate name of the appellant.

The contention of the appellant that the name is its trademark cannot be upheld. As a general rule a trade-mark has reference to the thing sold, whilst a trade-name embraces both the thing sold and the individuality of the seller. Armington v. Palmer, 21 R. I. 109, 42 Atl. 308, 79 Am. St. 786, 43 L. R. A. 95; Sartor v. Schaden, supra.

“The office of a trade-mark is to point ont distinctively the origin or ownership of the article to which it is affixed; or, in other words, to give notice who was the producer. This may, in many cases, be done by a name, a mark, or a device well known, but not previously applied to the same article.” Canal Co. v. Clark, 13 Wall. 311, 322.

A third party ivas punished for contempt for violating the injunction order. The appellant seeks to review the contempt order on this appeal. It cannot be so reviewed.

The appellant suggests that error was committed in rejecting and admitting certain evidence. Neither the evidence admitted nor that rejected was material in determining the issue.

The decree is affirmed.

Rudkin, C. J., and Fullerton, J., concur.