21 F. Cas. 1239 | U.S. Circuit Court for the District of Southern New York | 1865
This is a case of novel impression. I am of the opinion that it cannot be sustained, either upon principle, or by the application of any of the authorities submitted on the argument, or of any which I have been able to discover, after a somewhat diligent search. A full discussion of the vital points in the case will not now be attempted; and I shall, therefore, confine myself to a brief notice of such features of it as will disclose the grounds on which this motion is denied. The first material allegation of the bill is, “that, by the custom of the trade of booksellers and publishers in the United States, when any person or firm engaged in that business has undertaken the printing, publication and sale of a book not the subject of statute copyright, and has actually printed, published, and offered an edition of such book to the public for sale, other persons and firms in the same trade, having respect to the trade priority so acquired in the publication and sale of such book, or the particular edition thereof, refrain from entering into competition with such publisher by publishing such book in a rival edition, and that thereby, and by reason and operation of the custom aforesaid, the publication of such book becomes a good will in the hands of the jierson or firm so first publishing the same, where such book is one for which there is an extensive popular demand, and especially in The case of foreign authors of established reputation, whose works are not the subject of statute copyright in this country, and that such good will is often very valuable, and is often made the subject of contracts, sales, and transfers, among lmoksellers and publishers.” It is, also, averred in the bill, “that, such custom is a reasonable one, and tends to in-event injurious competition in business,and to the investment of capital in publishing enterprises that are of advantage to the reading public.” The bill then sets forth, “that, prior to the year 1861. one O. W. Wight projected the publication of a uniform edition of tin
This bill and motion are sought to be ; grounded on the principles which govern.! courts of equity, in dealing with the assets i of a partnership, at its dissolution; and the : question, whether or not the contract between ] the parties to this suit amounted to a part- ¡ nership or not, was discussed at length on I the argument. It is possible that, in some : of its features, the agreement may be held to > establish a relation closely resembling that i of partnership; but I do not now go into that ; question, because I do not deem it necessary, ; to enable me to properly dispose of this mo- ¡ tion. I will, therefore, assume, for my pres- ! ent purpose, that there was a special, limited, j and peculiar partnership established between i the plaintiffs and the defendant, in the enter- j prise set forth. The question then arises— ; what are the partnership assets upon which • this court can bring its power to bear, for ¡ the puipose of protecting the interests of the parties thereto ? As there is no question rais- ¡ ed as to the rights of creditors of the partnership, the whole controversy relates to the i alleged conflicting interests of the members . of the firm among themselves.
This court can deal only with the assets which belong, in law or equity, to the partnership. What are they? I do not find, from the contract, or from any evidence in the cause, that the partnership acquired any title, either legal or equitable, to any corporeal property about which any dispute has arisen. I think that the stereotype plates,, the plates from which the illustrations are printed, and the copyright thereto, are, clearly, the sole property of the defendant, and that all right in their use, in the interest of .the plaintiffs, must cease when the partnership expires, laying out of the case the question touching what is called the “good will,” I see no ground upon which it could be insisted that the partnership acquired any title to, or interest in, these plates and copyrights, beyond the right to have them used, for the term fixed by the contract, in carrying out the enterprise.
The only assets, then, which can,' in any view, be supposed to belong to the partnership, about which there is any controversy, is this species of incorporeal property called “good will.” If this could be deemed, under the peculiar circumstances of this case, to be property, capable of transfer, and possessed of value, its conveyance to the partnership, if it ever was conveyed, did not carry with it the printing establishment of the defendant, nor that portion of it which was employed in printing these books, nor the copyrights of the illustrations. If anything which can be called, in any legal sense, property, was transferred to this partnership, it must have been that incorporeal right of publishing this edition of Dickens, which is described in the bill as a “good will,” founded upon the custom of the trade to forbear competition. No corporeal property was embraced in this supposed transfer, by the terms of the contract, and none could adhere to it, as an incident. Good will may adhere to, or spring out of, corporeal property, or a tangible locality or establishment; but I think it would be new doctrine to hold the reverse; and treat the material property as an incident of the good wEl. Good will must always rest upon some principal and tangible thing, and it has, therefore, been held, that it can never arise as an asset of a partnership, where the members only contribute as capital their professional skill and reputation, however intrinsically valuable these may be.
Now, what is this alleged good will, in the present case, which this court is asked to treat as property, and for the preservation and beneficial sale of which its power is invoked, to continue the operation of this contract beyond the time fixed by its terms? It confessedly rests upon no common law of the country, recognized and administered by judicial tribunals. If it has any foundation at all, it stands on the mere will, or, as it is termed in the bill, the “courtesy” of the trade. True, it is called by the plaintiffs, the •'custom” of the trade, and is alleged in the bill to be a “reasonable custom.” But I apprehend that it is very far from being a legal custom, furnishing a solid foundation upon which an inviolable title to property
This alleged good will rests, therefore, ui>on no legal foundation, and, consequently, is not a partnership asset possessing any legal value. The books were printed by the defendant at his printing establishment in Cambridge, Massachusetts, and were published and sold by the plaintiffs, at their book store in New Tork; but neither of these establishments are partnership assets, which this court can decree to be sold, so as to carry with them a good will, in the ordinary sense in which that term is regarded as descriptive of property. Neither are the types, plates, or copyrights, from and under which the edition was printed, such assets. The only thing the court could decree a sale of would be this peculiar advantage, called the good will of the trade toward this particular edition. If this court were to appoint a receiver, he would have nothing to take, but this peculiar incorporeal right or advantage; and, should the business be continued, under this contract, for a period of years, the receiver would take nothing else, as there is nothing else belonging to the partnership which the parties are not agreed between themselves to take, without the interposition of the court. At the end, the court could decree the sale of nothing else. The buyer would take nothing valuable but what he would have been entitled to before, except the negative advantage of having the parties to this suit enjoined against the further use of the implements or materials by which this edition has been produced. This the court would not do if it had the power, because it would tend to destroy, and not conserve, the property. As it could not compel the sale and transfer of these implements and materials to the purchaser of the good will, but only forbid their further use by the defendant, its decree would be only productive of mischief to the defendant and the public, without conferring any benefit upon the plaintiffs, for the sale of this advantage called good will would bring nothing, as it would be worth nothing. The motion is, therefore, denied.