185 F. 431 | 7th Cir. | 1911
The appellee is an Ohio corporation, and the appellants are corporations under the laws of Illinois. The bill, and the amended bill, are to restrain the infringement of trade names and unfair competition in trade.
Appellee, beginning as a copartnership in 1848, and incorporating in 1883, has, from the beginning of its business, been engaged in the manufacture of cotton batting and wadding, and for tén years before the filing of the bill was extensively engaged in the manufacture and sale of cotton felt mattresses for beds. On these mattresses — affixing the names to different grades — the trade marks “Lenox,” “Windsor” and “Anchor” were adopted, the mattresses under these names having been extensively advertised to the public. More than 150,000 of these mattresses were sold each year at the time of the filing of the bill.
The appellant, the Dixie Cotton Felt Mattress Compan}'-, was organized in 1907 with a capital stock of $2,500, since which time it has been engaged in the manufacture of mattresses at Chicago, in competition with appellee in the Chicago trade. The record shows that this appellant was entirely familiar with appellee’s business, as also its mattresses and trade marks. Indeed, samples of appellee’s mattresses were brought to the plant of the Dixie Cotton Felt Mattress Company and cut open and examined, for the purpose of finding out the quality of its cotton and the character of its work, in order that the Dixie Company might make up similar mattresses to sell in competition.
The appellant, the Boston Store of Chicago, until a short time prior to the filing of the bill, was a customer of appellee, selling appellee’s mattresses bearing their trade names, and remained such customer until about October, 1909, when, entering into an arrangement with the Dixie Company, it put 200 mattresses of the Dixie Company on sale in its store, bearing appellee’s trade names. Accompanying this consignment of mattresses, were some small model mattresses, having their ends cut off to expose the cotton, which was branded with appellee’s trade names — the cotton in these models being of a high grade and comparing with the cotton, respectively, in appellee’s mattresses, but the cotton in the mattresses being of a low grade, and greatly inferior to either appellee’s mattresses or appellants’ models.
While there is no affirmative evidence of any misrepresentation upon the part of appellants, or either of them, respecting these mattresses being appellee’s goods, unquestionably the purpose of appellants, both by use of the models and of appellee’s trade names, was to create such an appearance, that persons acquainted with appellee’s mattresses would believe that the mattresses they were obtaining at the Boston Store, at reduced prices, were the same mattresses that appellee had been manufacturing and selling. There could have been no other motive for the use of these names, and the construction and arrangement of these models.
Appellants contend, however, that whether this bill be one of infringement of trade names, or unfair competition, it cannot be maintained unless it be shown that the trade names used were intended to
Appellants further contend that appellee, being a foreign corporation, has not complied with the Illinois act regulating the admission of foreign corporations to do business, and is therefore precluded from maintaining this suit by reason of Section 6 of the Illinois act (Hurd’s Rev. St. 1909, c. 32, § 67g), the applicable portion of which is as follows: •
“And in addition to suck, penalty, if after this act shall take effect, any foreign corporation shall fail to comply herewith, no suit may be maintained either at law or in equity upon any claim, legal or equitable, whether arising out of contract or tort in any court in this State.”
Incapacity to sue is a defense that must be made out by the defendants. All that is proven in this case is that appellee’s business house is at Cincinnati, and that it has warehouses all over the country, including one in Chicago, the one in Chicago being advertised as a “salesroom.” But there is nothing in this proof that excludes the fact
The statute of Illinois is directed against corporations “doing business” in this State in contravention of the act. The purchase and sale of goods at Cincinnati, in the state of Ohio, to he shipped into Illinois, is not “doing business” in Illinois. Havens, etc., Co. v. Diamond, 93 Ill. App. 557; March-Davis Cycle Mfg. Co. v. Strobridge Lithographing Co., 79 Ill. App. 683; Rock Island Plow Co. v. Peterson, 93 Minn. 356, 101 N. W. 616. Neither, in our opinion, is the purchase and sale of goods at Cincinnati, in the State of Ohio, to be delivered to somebody in Illinois from goods already deposited in a warehouse in Illinois for that purpose, “'doing business” in Illinois, within the meaning of the statute; for, in the one instance as much as in the other, the transaction is not an Illinois transaction, but an interstate transaction — something clearly within interstate commerce. And while the State of Illinois has the right to regulate the terms upon which foreign corporations shall do business in that State, it has no right to regulate, or in any way burden, interstate commerce; and we will not assume, in the absence of the clearest expressions to that end, that a State intends to do that, in its statute, which it may not constitutionally do under the constitution of the United States.
The decree appealed from is affirmed.