189 A. 473 | Pa. | 1936
Lead Opinion
Argued December 1, 1936. This is an appeal from the decree of the court below dismissing the complainant's bill in equity by which it *275 sought to enjoin defendants from using the term "Quaker City" or any trade name in which the word "Quaker" is used, in connection with the sale of their motor oil.
In 1914 the complainant commenced marketing a motor oil under the name "Quaker State." It is prepared from crude oil produced in certain sections of New York, Pennsylvania, Ohio and West Virginia, known in the trade and to the public as Pennsylvania Grade Crude Oil. From 1914 "Quaker State" oil has been sold by automobile service stations and garages throughout the country. It has been extensively advertised in magazines and newspapers, also by means of outdoor signs along the highways. This oil was for some years specifically recommended by the manufacturers of Franklin motor cars for use by their owners. The business has experienced a steady growth, and at the time this case was tried, in 1935, upwards of 70,000 dealers handled the oil and the annual aggregate of sales amounted to 10,000,000 gallons, in 1930 or 1931 to a still larger gallonage.
The defendants started to market "Quaker City" motor oils in 1919 in a small way, selling directly to consumers, for the most part to operators of fleets of motor trucks. In 1920 they began the sale of their product through service stations and garages and continued to do so until the time of trial. Defendants' oil is likewise made from Pennsylvania Crude, and although sold at a slightly lower price, according to the evidence is in no sense inferior to that of complainant. The advertisements of and the containers for the two oils are not the same. The containers for "Quaker State" are primarily green in color, those for "Quaker City" are a bright orange.
The chancellor entered a decree enjoining defendants from selling their product under the trade name "Quaker City" and from using the word "Quaker" alone or with other words as the name of their motor oil. The court *276 in banc overruled the chancellor, the chancellor dissenting, and held that "Quaker State" is a descriptive term; that no exclusive right to use a descriptive term can be secured in the absence of a showing that it has a secondary meaning, and it not being shown that the term as applied to complainant's oil had such a meaning in 1919, when defendants entered the field, the relief prayed for should not be granted.
We think Judge PARRY, speaking for the majority of the court below, properly summed up the legal principles governing the case by saying: "We think the word Quaker [State] is a descriptive term not capable of exclusive appropriation by anyone and that it may be used by the world at large in an honestly descriptive and non-deceptive way. The use of truthfully descriptive terms may not in any case be absolutely prohibited; the first trader being entitled as against another only to such protection as will prevent such other from using the term to pass off his goods as those of the original appropriator, 63 C. J. 425."
Aside from any judicial determination, it is obvious that the words "Quaker State" are geographical. A state, like a person, may have more than one nickname. Because of its founder and its early settlers no other state could be so properly dubbed "Quaker" as Pennsylvania, and when so spoken of everyone of average intelligence understands that Pennsylvania is meant. Had complainant adopted as the designation of its product the words "Pennsylvania State," no one would contend that it had not appropriated a geographical term, none the less has it done so, because it has taken one of the state's nicknames.
There are two cases in which the courts were called upon to determine the nature of the name "Quaker City." In both the name was held to be geographical: Loughran v. Quaker CityChocolate Confectionery Co., 296 Fed. 822, and Quaker CityFlour Mills Co. v. Quaker Oats Co., 43 App. (D.C.) 260. So it has been *277
determined that "Keystone" when used as an adjective for state is a geographical term and not exclusively appropriatable:Cohen v. Nagle,
Mr. Justice DREW, when on the Common Pleas, had occasion to consider the attempt to exclusively appropriate the word "Columbia" as a trade-mark or trade name in Columbia FilmService, Inc. v. Columbia Pictures Corp., 76 Pittsburgh Legal Journal 529, and decided that the plaintiff had not acquired nor could it acquire the exclusive right to the use of the word "Columbia" as a trade name, for the reason that "Columbia" means the United States and is a geographical designation incapable of exclusive use.
It is clear under the best considered authorities that a purely descriptive term such as a geographical one cannot be exclusively appropriated by anyone. This principle is established for the obvious reason that to permit the exclusive appropriation of such a term would prevent others from properly describing their product and hence a monopoly would result: Derenberg, Trade-Mark Protection and Unfair Trading, p. 238. "It is conceded, as a general rule, that the name of a town or city cannot be so appropriated as the exclusive property of anyone": Glendon Iron Co. v. Uhler,
If, however, the geographical term has taken on a secondary meaning it will be protected. This exception is best stated in the case of Merriam Co. v. Saalfield, 198 Fed. 369, 373: "Primarily, it would seem that one might appropriate to himself for his goods any word or phrase that he chose; but this is not so, because the broader public right prevails, and one may not appropriate to his own exclusive use a word which already belongs to the public and so may be used by anyone of the public. Hence comes the rule, first formulated in trade-mark cases, that there can be no exclusive appropriation of geographical words or words of quality. This is because such words are, or may be, aptly descriptive, and one may properly use for his own product any descriptive words, because such words are of public or common right. It soon developed that this latter rule, literally applied in all cases, would encourage commercial fraud, and that such universal application could not be tolerated by courts of equity; hence came the 'secondary meaning' theory. There is nothing *279
abstruse or complicated about this theory, however difficult its application may sometimes be. It contemplates that a word or phrase originally, and in that sense primarily, incapable of exclusive appropriation with reference to an article on the market, because geographically or otherwise descriptive, might nevertheless have been used so long and so exclusively by one producer with reference to his article, that in that trade and to that branch of the purchasing public, the word or phrase had come to mean that the article was his product; in other words, had come to be, to them, his trade-mark. So it was said that the word had come to have a secondary meaning, although this phrase, 'secondary meaning,' seems not happily chosen, because, in the limited field, this new meaning is primary rather than secondary; that is to say, it is, in that field, the natural meaning. Here, then, is presented a conflict of right. The alleged trespassing defendant has the right to use the word, because in its primary sense or original sense the word is descriptive; but, owing to the fact that the word has come to mean, to a part of the public, something else, it follows that when the defendant approaches that same part of the public with the bare word, and with nothing else, applied to his goods, he deceives that part of the public, and hence he is required to accompany his use of the bare word with sufficient distinguishing marks normally to prevent the otherwise normally resulting fraud." "Secondary meaning is association, nothing more. It exists only in the minds of those of the public who have seen or known or have heard of a brand of goods by some name or sign and have associated the two in their minds": Nims, supra, p. 105, "When the word is incapable of becoming a valid trade-mark, because descriptive or geographical, yet has by use come to stand for a particular maker or vendor, its use by another in this secondary sense will be restrained as unfair and fraudulent competition, and its use in its primary or *280
common sense confined in such a way as will prevent a probable deceit by enabling one maker or vendor to sell his article as the product of another": Computing Scale Co. v. StandardComputing Scale Co., 118 Fed. 965, 967. See also AmericanWaltham Watch Co. v. United States Watch Co.,
The evidence produced by plaintiff as to the words "Quaker State" acquiring a secondary meaning, relates to the years following 1919, when the defendant started in business. The evidence shows that at least some part of the purchasing public in using the words "Quaker State" and "Quaker" in connection with oil had reference to the complainant's product. But even if we assume that the words "Quaker State" acquired a secondary meaning after 1919, it would not aid the complainant. Both on reason and authority the complainant's trade name must have acquired a secondary meaning before the defendants began the manufacture and sale of their product: Upjohn Co. v. Wm. S.Merrell Chemical Co., 269 Fed. 209. The acquisition of a secondary meaning following this time could not justly divest the defendants of their rights.
The only evidence from which it could be inferred that the name of complainant's product had acquired a secondary meaning prior to 1919 is that its product has been marketed and had been nationally advertised for five years under this name. There is no other evidence from which it could be inferred that the public associated "Quaker State" or "Quaker" with the complainant's *281
product at that time. "The mere adoption and use of words in advertisements, circulars and price lists and on signs and stationery give no exclusive right to their use": DeLong Hook Eye Co. v. Hump Hairpin Mfg. Co.,
But even if it be assumed that the words "Quaker State" acquired a secondary meaning in 1919, it will not help the complainant's case. The defendant can only be enjoined from the use of the name "Quaker City" if it is deceptively similar thereto: Celluloid Mfg. Co. v. Cellonite Mfg. Co., 32 Fed. 94. There is nothing in the names "Quaker State" and "Quaker City" that should confuse the purchasing public. Even the most careless observer would recognize the distinction between the two. "Quaker State" denotes to all, "Pennsylvania," and "Quaker City" denotes "Philadelphia." A similar situation arose over the right to use the words "Quaker City" and "Quaker Maid" as applied to candy. In that case it was said: "The defendant introduced no evidence that these trade-marks are confusing because of similarity. In other words, it did not attempt to prove that the trade has ever been confused by the marks or that purchasers have ever mistaken one for the other, or have mistaken the wares they mark, a situation which at first induces one's mind to conclude that the ground for opposition is not tenable. Therefore, we must determine from the trade-marks themselves whether they resemble each other so closely that confusion or mistake in the mind of the public will likely occur. . . . Without reciting the processes by which we have arrived at our conclusion, it will be enough to say that after a careful study of these trademarks we have not found such similarity, and, therefore, are constrained to affirm the finding of the learned *282 District Judge": Loughran v. Quaker City Chocolate Confectionery Co., 296 Fed. 822, 826.
It is true that the evidence before us shows there is confusion on the part of some of the consumers. This confusion, however, is the result of the fact that some of the purchasers call the plaintiff's oil by the name "Quaker" rather than "Quaker State." The record is barren as to any confusion between the names "Quaker State" and "Quaker City." Such being the case, the complainant contends that it now has the right to use "Quaker" exclusively as well as "Quaker State," and asks the court to restrain all who use a trade name similar to "Quaker" as well as those who use a name similar to "Quaker State." This argument is inapplicable to the facts in the case for one reason and possibly for two. First, there is no evidence that the complainant's oil was called "Quaker" in 1919, when the defendant started in business. Hence it cannot be said that the defendant violated any rights of the complainant at that time. The fact that the public afterwards began to call the complainant's product "Quaker" should not be permitted to divest the defendants of any rights already acquired. Second, this same argument was raised in Loughran v.Quaker City Chocolate Confectionery Co., supra, and the court dismissed it, saying (p. 826): "But the unusual thing about the opposition of the defendant is that its complaint does not extend so much to a claimed deceptive similarity between the contesting trade-marks as it does to its claimed right, previously stated, to take out of its trade-marks the catch word 'Quaker' and use it in its business generally — and exclusively. The defendant maintains that it has used the word 'Quaker' disenjoined from the word 'City' and has applied it to advertising, wrapping, boxing and selling its candies so long that its candies have become known to the public by this single word and therefore the registration of the plaintiffs' trademark of 'Quaker Maid,' though accompanied with a *283
representation of a Quaker woman, would carry to the trade the idea that the plaintiffs' candies are made by the defendant. This conclusion is only true if the defendant were entitled to the exclusive use of the word 'Quaker.' We cannot see what right it has to appropriate and make claim to the exclusive use of one of several trade-mark words. 'Quaker City,' the name by which the City of Philadelphia is popularly known, is a name freely used by a multitude of tradesmen, as an inspection of the telephone directory of that city will abundantly show. The registration of a trademark does not give the registrant a monopoly of every word in the trade-mark, however, disposed and used." This same thought is tersely stated by Judge JESSELL inCowen v. Hulton, 46 L. T. R. (N.S.) 897: "He has a right to the name by which he sells his paper, but not the name by which people chose to call it." See also Evening Journal Asso. v.Jersey Pub. Co.,
In Caron Corporation v. Conde, 126 Misc. (N.Y.) 676, 677,
In any event there is no evidence that the public called the complainant's product "Quaker" in 1919 and hence for this reason the argument should not be given effect. This conclusion is supported by Bayuk Cigars, Inc. v. Schwartz,
The testimony discloses that another company located in Indiana adopted the name "Quaker" for its oils two years before the plaintiff's earliest use of the designation, so that it could not be said that plaintiff had exclusively used the name. See Columbia Mill Co. v. Alcorn,
If it had been shown that the defendants were endeavoring to palm off their product as plaintiff's, a different situation would exist and relief would be granted. Nothing of that kind was attempted to be established. All that appeared was that occasionally some purchaser did not differentiate between "Quaker State" and "Quaker City" when inquiring for or purchasing oil. These two concerns can if good faith is maintained continue to sell their respective oils as they have in the past. If defendants should endeavor to foist their oil on those who desire that of plaintiff by misrepresenting what it really is, relief can be granted against such unfair trade methods.
The decree is affirmed at appellant's cost.
Dissenting Opinion
The majority opinion says: "The defendant can only be enjoined from the use of the name 'Quaker City' if it is deceptively similar [i. e., if it is similar to 'Quaker State']." I think the words "Quaker City" are deceptively similar to "Quaker State." I cannot agree with the statement that "there is nothing in the names 'Quaker State' and 'Quaker City' that should confuse the purchasing public." The impressive word in both of these phrases is "Quaker." The human mind so functions that its attention is concentrated on one word of *285 any title or descriptive phrase. The average observer would either not note the difference between the phrases Quaker State and Quaker City or he would think that both oils were marketed by the same company and probably taken out of the subterranean caverns of Pennsylvania, which are generally known to yield oil of superior quality. Under the decree handed down by the majority, I see no reason why any person or company cannot now market without restraint an oil called "Quaker Town Oil" or "Quaker Borough Oil" or "Quaker Nation Oil."
Even when two proper nouns are linked together in a name, as, for example, "Waldorf-Astoria," one of the nouns soon becomes dominant and the public refers to the designated thing by its dominant name. People generally now refer to the "Waldorf-Astoria" as the "Waldorf." This one-word dominance is more pronounced when a proper noun is linked with a common noun as a designation. If some one produced and marketed cotton designated as "Missisippi Valley Cotton," it would soon become known as "Mississippi Cotton," and if, after it had secured a valuable reputation, another would market cotton and call it "Mississippi River Cotton," the latter name would be well calculated to deceive purchasers.1
In Scranton Stove Works v. Clark et al.,
In American Clay Mfg. Co., a corporation of Penna., v.American Clay Mfg. Co., a corporation of N.J.,
In the case of A. Hollander Son, Inc., v. Jos. Hollander,Inc., et al.,
In Quaker City Chocolate Confectionary Co., Inc., v.Kernan, 278 Fed. Rep. 592, which was a trade-mark case, the Court of Appeals of the District of Columbia held that the plaintiff's objection to the defendant's use of the words "Quaker Maid" as a trade-mark for candy was well taken. The court said: "The goods on which the respective marks are used are the same and would undoubtedly be known to the trade as "Quaker Candy."
The Third Circuit Court of Appeals,
The Circuit Court of Appeals (10th Circuit),
Even if "Quaker State" be considered a geographical name (which it is only in a seldom used colloquial sense), plaintiffs are no less entitled to protection in its use after they by advertising and marketing their product under that name have given it great commercial value than they would be if they had invented the name. The hesitancy which some courts in an earlier day manifested in protecting commercially used geographical names now seems to be disappearing. Many names originally geographical are now as well known commercially as they are geographically and their commercial use has frequently received judicial protection. In Elgin Nat. Watch Co. v.Illinois Watch Case Co.,
I cannot agree with the statement in the majority opinion that the words "Quaker State Oil" did not acquire a secondary meaning until after 1919. The majority opinion concedes that plaintiff's "Quaker State Oil" had "been marketed and nationally advertised for five years [prior to 1919] under this name." That is surely enough to entitle plaintiff to protection against anyone using the same or a similar name after plaintiff had so nationally advertised its product. Any name, geographical or otherwise, as applied to a product, becomes an asset of the person who advertises and markets that product as soon as the public begin to associate that name with that product.
In American Waltham Watch Co. v. U.S. Watch Co.,
In an article entitled "Trade-Marks and Trade Names," 30 Columbia Law Review (1930), page 192, it is said: "A geographical term may be used to indicate the place of manufacture, e. g., that watches are manufactured at Waltham, Mass. It may come to signify a particular quality, e. g., Minneapolis flour, Rochester clothing. It may in time represent a special process, e. g., Budweiser beer. Finally, it may be used to designate the source or origin of a particular product, e. g., Elgin watches, Vienna bread. . . . The statement that geographical names cannot be valid trademarks is obviously too broad. . . . Why should not the person who added a new meaning to words previously signifying place, grade, or quality have the 'exclusive right' to use them in this acquired sense? . . . For present purposes, it is a matter of indifference whether geographical names are regarded as trademarks or trade names so long as they are as adequately protected against piracy as the Waltham mark [in American Waltham Watch Co. v. U.S. Watch Co., supra]. No mark, no matter how fanciful or unique, would receive greater protection. The Waltham case does not stand alone. In both the Glenfield Starch and Stone Ale cases, two famous English authorities, absolute injunctions were granted. In view of the broad relief given in these early cases, it is surprising that the notion should ever have developed that geographical names cannot be trade-marks."
In Columbia Grammar School v. Clawson,
In Hamilton-Brown Shoe Co. v. Wolf Bros. Co.,
There is no reason why an oil company cannot be as fully protected in the use of a geographical name as are hotel and railroad companies. Many of the latter bear geographical names, notably the Pennsylvania Railroad and the Baltimore Ohio Railroad.
Plaintiff by the expenditure of millions of dollars has affixed the name "Quaker State" in the public mind as being an oil marketed by it and presumably refined, at least in part, from Pennsylvania crude oil. The distinctive, "catchy" part of that name is the word "Quaker." By defendants calling their oil "Quaker City Oil," public deception is clearly invited. The defendant-partnership's own fictitious trade name is not "Quaker City" but "Pennsylvania Petroleum Products Company." They began to market their oil, which certainly is not produced from "Quaker City" oil wells, only after the plaintiff, which bears the name "Quaker State Oil Refining Company" had nationally advertised "Quaker State Oil" for four years and had acquired *293 for such oil a large and constantly expanding market.
The majority opinion says: "The testimony discloses that another company located in Indiana adopted the name 'Quaker' for its oils two years before the plaintiff's earliest use of the designation, so that it could not be said that plaintiff had exclusively used the name." I think the answer to that is twofold: (1) the present plaintiff in a suit captionedQuaker Oil Co., Inc. [the Indiana Company] v. Quaker State OilRefining Co., 74 Fed. (2) 553, successfully opposed the registration of the word "Quaker" by the Indiana Company. In that case the court said: "It appears from the record that appellee's [Quaker State Oil Refining Company] trade-marks ["Quaker State Medium," "QSM," and "Quaker State"] have been in continuous use by appellee and its predecessor since July 31, 1914, . . . that appellee's lubricating oils and greases are generally referred to by the term 'Quaker'; that appellee had utilized practically every available means in advertising its trade-marks and its lubricating motor oils throughout the United States and Canada, . . .; that it has expended more than $2,000,000 in such advertising; and that it has sold its lubricating motor oils under its trade-marks throughout the United States and Canada." Registration of the word or mark "Quaker" by the Quaker Oil Company of Indiana was denied on the ground that it had not shown any use of the word "Quaker" prior to the use of that word by the Quaker State Oil Refining Co. The second answer is that it is immaterial to the issue in the instant case whether the Indiana Company had used the word "Quaker" to designate its oil before the plaintiff had so used that word. The present controversy is not between the present plaintiff and the Indiana Company. If it were and the Indiana Company could show that it had used the word "Quaker" to identify the oil it advertised and marketed in a certain territory, before the present plaintiff had advertised and marketed its oil in that same *294 territory, it could justly demand the protection the plaintiff now asks for in this case against the defendant. It might well happen that two different corporations or individuals might begin to use in widely separated parts of the country the same trade name to designate the same kind of a product and at about the same time or otherwise. In such a case the right of each to its own territory would doubtless be judicially recognized. For example, in American Radio Stores, Inc., v. American Radio Television Stores Corp., 150 A. 180 (1930), the defendant was "enjoined from using as part of its corporate name the word "American" in the territory where the complainant does business and in territory competitively contiguous thereto which is reached by the complainant's trade and solicited by the complainant's advertisements." As Justice HOLMES said inAmerican Waltham Watch Co. v. U.S. Watch Co. (supra): "In cases of this sort, as in so many others, what ultimately is to be worked out is a point or line between conflicting claims, each of which has meritorious grounds, and would be extended further were it not for the other." Whatever may be the respective rights of the plaintiff and the Indiana Company, they have no bearing on the issue here, that issue being the right of the defendant to use the name "Quaker City" to designate its oil in territory admittedly commercially occupied by plaintiff's "Quaker State Oil" before the defendant or any other company using the name "Quaker" to designate an oil had entered that territory as a competitor.
The chancellor of the court below found — and these findings were not even excepted to — inter alia, as follows: "9. Plaintiff spent about; $650,000 for advertising in the year 1934; and plaintiff and its predecessors have expended $8,000,000 to $10,000,000 in advertising 'Quaker State' oils and in bringing its trade name, 'Quaker State,' to the knowledge of the public and have spent approximately $15,000,000 to $18,000,000 in establishing *295 70,000 dealers. The latter figure includes a portion of the advertising expense. 10. A valuable good will in the business of marketing motor oil under the trade name 'Quaker State' has been built up; the volume of business done by plaintiff in the sale of 'Quaker State' motor oil is large and in the year 1930 aggregated 18,000,000 gallons thereof."
I agree with the chancellor's 11th, 12th and 13th conclusions of law (as well as his other conclusions) reached as follows: "11. Under all the testimony the plaintiff is entitled as against the defendants to the sole use of the word 'Quaker' when applied to and used as a name for motor oil. 12. Plaintiff's interest in its good will, in the name of its merchandise, in its trade name and in the reputation of its business is property which a court of equity will protect from destruction or injury. 13. The money expended by plaintiff in advertising and sales promotion and the public demand for its product and the reputation of its oil for uniformity are good will and constitute property. The effect and tendency of the conduct of the defendant is to injure or destroy that property."2 *296
I do not think the court below was justified in vacating the chancellor's decree nisi. I would therefore reverse the decree of the court below and decide this case as the chancellor decided it.
See also Coca-Cola Co. v. Chero-Cola Co., 273 Fed. 755, where the Court of Appeals of the District of Columbia, said: "The prospective purchaser . . . acts quickly. He is governed by a general glance. The law does not require more of him."