E. T. Fraim Lock Co. v. Shimer

Opinion by

Rice, P. J.,

The principal object of this bill in equity was to restrain the infringement of a trade-mark which is thus described: The design or emblem is the keystone symbol of the commonwealth, slightly raised over the keyhole, which divides it', of a small ordinary padlock, such as is usually sold in commerce. The padlock manufactured by the defendant is similar in size, shape and design, with the same emblem cast in the same manner. Both are exactly alike in general appearance, but the plaintiff’s is a little finer in finish. There are no letters or words of any kind on either. This precise emblem was appropriated by the plaintiff or its predecessor and first applied as above described to padlocks of its manufacture in 1900, and by the defendant or his predecessor to padlocks of his manufacture in 1906. On November 6, 1907, the plaintiff caused it to be registered in the office of the secretary of the commonwealth in the manner prescribed in the Act of June 20, 1901, P. L. 582, and received from that officer a duly attested certificate of the record. The defendant, without actual knowledge of the prior appropriation by the plaintiff and this registration on November 6, 1907, continued the use of the trade-mark until August, 1908, when, being notified by the plaintiff of the alleged infringement, he discontinued the manufacture and sale of padlocks bearing it.

1. It is argued that on this last ground alone the bill ought to have been dismissed. It is to be noticed, however, that the ground of defense set up in the defendant’s answer was not that this was an innocent infringement which he discontinued as soon as discovered. There, he not only challenged the right of the plaintiff to the trademark in question, but he also denied that he had at any time done anything that would entitle the plaintiff to the relief prayed for. In effect, he asserted the right to do in the future what he had done in the past, and gave no intimation that it was his intention not to resume the manufacture and sale of padlocks bearing this trade-mark. In view of the issue upon which the case went to final hearing, the mere fact, proved on the. trial, that he discontinued the manufacture and sale which he, in effect, asserted the right to resume at any time, if not restrained, was not ground for refusing an injunction, much less for dismissing the bill.

2. The learned judge held that the certificate of the secretary of the commonwealth, issued under the act of 1901, upon ex parte proofs, does- not divest the jurisdiction of the courts to determine the validity of the act of appropriation or the character of the symbol as a lawful trade-mark, and, therefore, it did not of itself preclude the defendant from asserting its invalidity and denying the right of the plaintiff to a monopoly in its use. This conclusion is so well supported by his opinion that we adopt it without further discussion.

3. The office of a trade-mark is to point out distinctly the origin or ownership of the article to which it is affixed: Delaware & Hudson Canal Co. v. Clark, 80 U. S. 311, and thus to protect the purchaser as well as the vendor. But that a name, device or symbol, although arbitrary and fanciful, may in process of time come, by association, to point unmistakably to the origin of the article, although not immediately connected with the name- of the owner or place of manufacture, is a proposition that is supported not only by reason but by authority. It would be an almost endless task to review and attempt to harmonize or distinguish all the cases from the different jurisdictions of this country in which names and symbols as trade-marks have been considered. But it is safe to say that the proposition as we have stated it is supported by the weight of authority. In the case last cited, Justice Strong, after elaborately discussing the question, said: “Hence the trade-mark must either by itself, or by association, point distinctively to the origin or ownership of the article to which it is.applied. The reason of this is that unless it does, neither can he who first adopted it be injured by any appropriation or imitation of it by others, nor can the public be deceived. The first appropriator of a name or device pointing to his ownership, or which, by being associated with articles of trade, has acquired an understood reference to the originator, or manufacturer of the articles, is injured whenever another adopts the same name or device for similar articles, because such adoption is in effect representing falsely that the productions of the latter are those of the former. . . . . The trade-mark must, therefore, be distinctive in its original signification, pointing to the origin of the article, or it must have become such by association.” And, as pointed out in the opinion of the learned judge in this case, the same principle is recognized in other cases, and particularly in the rules formulated in Columbia Mill Co. v. Alcorn, 150 U. S. 460. Applying this principle to the facts of the case, he reached the conclusion which we deem it important to quote' in this immediate connection. “Upon the considerations herein stated I must conclude that the plaintiffs have shown their right to a technical trade-mark; its specific design and use in the market has given to it that association and character by which the defendant’s ignorant and accidental employment of it, if continued, would have a tendency by the exact similarity, as in the case of the same trade name (American Clay Mfg. Co. v. Clay Mfg. Co., 198 Pa. 189) to confuse the public mind respecting the manufacturer, and the identity of the wares. For this equity will extend its protection.” We need not reiterate the citation of other cases, supporting this conclusion, that will be found in his opinion and in the appellee’s brief. We deem it sufficient to say that, after deliberate consideration of the evidence, the learned argument of appellant’s counsel, and the authorities bearing upon the question, we unanimously concur in the fore-' going conclusion and in the reasoning of the opinion of the learned judge in support of it.

4. In his eighth point of law the defendant requested the court to find that in any event no penalty can be visited on defendant, but only an award of injunction against him restraining him from using said trade-mark, “as his act was neither fraudulent nor calculated to deceive.” The majority of us are of opinion that this point was properly refused and that no error was committed in imposing the penalty. It is true the court found as a fact that the defendant adopted the trade-mark without actual knowledge of its prior adoption by ,the plaintiff, and continued its use after registration, without actual knowledge of that fact. But the court did not find, and would not have been warranted in finding, that the defendant’s action was not calculated to deceive. On the contrary, irrespective of fraudulent intention, the tendency of his action was to produce confusion in the public mind and consequent loss to the plaintiff. And the general rule is, that anything done by a rival in the same business, by imitation or otherwise, designed or calculated to mislead the public in the belief that in buying the product offered by him for sale they were buying the product of another’s manufacture, would be in fraud of that other’s rights and would afford just grounds for equitable interference: Juan F. Portuondo Cigar Mfg. Co. v. Vicente Portuondo Cigar Mfg. Co., 222 Pa. 116; Hohenstein v. Perelstine, 37 Pa. Superior Ct. 540. Is the mere fact that the defendant adopted the trade-mark in ignorance of the plaintiff’s right to its exclusive use ground for refusing to impose the penalty? Section 4 of the act of 1901 prescribes a penalty of $200 for wrongfully performing or permitting to be performed any act expressly prohibited or declared unlawful by sec. 3, and the jurisdiction of a court of equity Upon an injunction bill to impose the penalty is given in these words: “and the court having jurisdiction of the parties shall grant an injunction restraining the defendant from such unlawful acts, and in addition to the penalty provided for in this section shall award to the plaintiff such damages, resulting from such wrongful and unlawful acts, as may be proved, and shall require the defendant to pay to the plaintiff the profits derived from such unlawful acts.” The appellant’s counsel would construe this act to mean the same as if, instead of the word “wrongfully,” the legislature had used the words “with fraudulent intent.” This is the logical import of his argument. We are constrained to the opinion that if this had been the intention of the legislature they would have expressed it in unmistakable terms. The purpose of this statute was considered in Bergner & Engel Co. v. Koenig, 30 Pa. Superior Ct. 618, where our Brother Henderson, speaking for the court, said: “The proprietor of the trade-mark not only has what has been frequently called a property interest therein, but there is also a public interest out of which legislative control arises. One of the reasons for the protection of trademarks exists in the policy of encouraging trade and manufacture and stimulating the production of commodities which are acceptable in the market. Another is the prevention of fraud upon consumers. It has long been recognized as a police power of the state to protect its citizens from imposition in regard to the kind and quality of goods they purchase, and dealers in merchandise have a right to adopt a distinguishing mark by which their commodities may be known. Legislation of this character has been enacted by the United States and by substantially all of the states and in many instances penalties have been prescribed.” Further on in the opinion he says: “The object of the statute is to punish one who unlawfully appropriates the trade-mark of another. The owner may be indirectly interested, but the penalty inflicted is for the wrong done to the public. Numerous penal statutes are in force in which the penalty is recoverable in whole or in part by the informer or the ‘party aggrieved. ’ ” Many such statutes are cited in the opinion. In holding that the defendant’s ignorance furnishes no defense against the recovery of the penalty, it is to be noticed, first, that before the defendant applied the trade-mark to padlocks of his manufacture the plaintiff had acquired, under the application of common-law principies, the exclusive right to its use upon padlocks; second, that the defendant continued his infringement of the plaintiff’s trade-mark after the latter had caused it to be registered in the manner provided by the act of 1901. Therefore, if the defendant acted ignorantly in continuing the infringement it was because he did not avail himself of the means of knowledge which registration under the act of 1901 was intended and was ample to furnish him. This being so, we see no escape from the conclusion that his act was wrongful within the true intent and meaning of the statute.

We have not discussed the case as fully as would seem necessary if the opinion of the learned trial judge had not so fully and satisfactorily met and answered the questions raised by the assignments of error and the contentions advanced in the able argument of appellant’s counsel.

The decree is affirmed at the costs of the appellant.