*1 YATES, Inc., et v. MAHOG BLACK & al. Inc., ASS’N, ANY et al.
No. Appeals, Third Court of Circuit. 30, 1941.
June
Reargued Dee. Rehearing
On June *2 Martin, City Wallace H. of New -York Morris, Del., (Hugh Wilmington, M.
(cid:127) Harry Nims Minturn deS. Ver- D. di, City, both of New York and S. Samuel Arsht, Del., brief), Wilmington, on the appellants. for McCool, City (Ar- Wm. P. of New York Logan, Logan Duffy, thur & all of G. Del., Wilmington, de- brief), Associates, on the for fendant-appellee Mahogany Inc. Forster, Montgomery Philadelphia, J. (Arthur Logan, Wilmington, Pa. Del., G. Thomp- brief), appellee on the Mahogany son Co. MARIS, CLARK, Before and GOOD- RICH, Judges. Circuit CLARK, Judge. judge The learned district seems to us to have been influenced his solution happen did an issue that parties pro before him. The tagonists are the year fifteen The battle.1 botany ending began contest and is with geography. The sell three Philippine grows which a hardwood they Islands and to which have added the designation “mahogany”. association and the members there claim to be the true of which who
prophets
mahogany. They
base that
claim on certain botanical considerations
with which the Federal Trade Commission
(1927
1928)
and the courts at first
original agreement,
agreed.2, After
however,
statutory body
vested with
botany
geog
abandoned
raphy.
approved (1931)
stipulation
“Respondent
stipu
hereby
which reads:
sale,
agrees
descrip
lates and
tion,
and advertisement of the wood
Philippine
which it has here
Islands
‘Philip
designated
tofore
and described
pine Mahogany’
commerce
articles
Mahog
Williams,
Yates,
seq.;
States and
&
Inc. et al. v.
et
United
Black
F.Supp.
Association, D.C.,
Philippines, p.
Lamb,
Ma-
published
hogany Book,
Ed.,
Co.
Feder
Quartered
Indiana
Oak
Inc.;
Mahogany
Commission,
Cir., 1928,
Association,
Tex-
F.
al Trade
Mahogany
Philippine
(pamphlet),
ture of
2d 340.
Mahogany
Philippine
(pamphlet),
both
Philippine Mahogany
published
botanists, mahogany
3 According
to the
Assn.;
Stately
Import
only by
genera
produced
Manufacturers’
Swietenia
Reprint
specimen
family,
Mahogany,
of Four
A Condensed
Meliaceae
Philippine
grows
from Station
Islands.
Radio Talks Broadcasted
City.
p.
WEAF,
Philippines,
Wright,
York
New
Handbook of the
therewith,
employ
(2)
word
“A
it will not
dealer
who sells
made
unethical
Philippine
‘mahogany’
mahogany
in connection with the sale of
under
name”.
modifying
wood
term
said
without
(3)
Philippine mahogany
“To sell
under
‘Philippine’.” Gillespie
Furniture
public’’.
that name deceives the
F.T.C.Decisions 444.
*3
(4)
Philippine
“To
mahogany
sell
is
competition.”
Federal Trade
had
As the
Commission
mind,
(5)
changed
enforcing
pending
“In the
its
case
before the
Commission,
Appeals
compelled
expected
was
do Federal Trade
Court of
it is
original
modified
decree.that the Commission will rule
likewise and so
its
that the name
4
‘mahogany’
applied
Thereafter
1934 decision in
cannot be
a
Supreme
Philippine
these
United States
Court occasioned
woods.” Plaintiffs’ Bill
Particulars,
b, f, h,
r,
part
paragraphs a,
i,
still further
irresolution on the
d, e, s,
u,
prescribed
Appendix
plaintiffs-ap-
a
and
Commission. That case5
pellants’
proof
brief,
high degree
ac
as essential to the
33-34.
6
quisition
“secondary”
meaning.
aof
conceded,
It
is
as it must
that
In obedience to the
decidendi of this
ratio
disparaging.
They
statements
holding,
Fed
California White Pine
seriously upon
plaintiffs’ prop-
flect
eral Trade Commission was constrained
erty
practice;
falsely
and business
and
controversy
reopen
and did
for the so, unless and until such reflection is sanc-
course,
reopening,
second time. The
by
tioned
a court’s
The
condemnation.
took
form
of a call for a further evi
judge unconsciously
learned district
in-
interpretation
dential
“Phil
of the term
fluenced,
think, by
disap-
as we
his own
ippine Mahogany”.
proval
practice
by
and
his con-
ultimately
fidence that the courts will
share
point,
At this
the defendant association
they may
his view —as well
—dismissed
indulged
forecasting.
itself in
It
a bit
placed
bill.
enjoin
He
the refusal
did not wait for the revised decision —it at-
uncomplimentary
continuance of the
ref-
tempted
preview.
It
is of the nature
erences on what we deem
obsolete
to be an
anticipation
now com-
conception of
The
the law.
case7 relied
plain.
(both
It consists of
oral
statements
application
on is of
de-
doubtful
and was
written)
and
on the as-
were based
cided in 1886. We
has
believe that the law
sumption
Philippine Mahogany had
developed since that time.
acquired
secondary meaning
not
right
disparagement
of action
widely
which were
circulated
the hard-
property
in developing
was slow
assumption
wood trade. From the
fol-
it
early
common law. The
cases took a
lowed,
quote typical
assertions of
8
Shaksperian
they lagged
view.
So
behind
defendants,
:
analogous
personality
attack on
(1) “Philippine mahogany
defamation,
way
is a sub-
although
attack
stitute,
wood,
mahogany
is not a
is mis- what a man owns
sells
seem
would
nomer,
way
mahogany,
just
is in no
injurious
related to
attack
as an
on what
comparable
is an inferior
might expect
wood
not
to he is.
classic
As one
mahogany,
qualifications
exposition
none
is
Professor
Jeremiah
mahogany
up,
will
crystallized
not stand
is a coun- Smith.9
After the courts
terfeit, a
tort10
substitute and
fraud”.
certain elements remained uncertain.
Trade-Marks,
Unfair
Shredded Wheat
2d 182.
Lumber
Trade-Name —Distinction
396; Equity;
78 L.Ed.
Derenberg,
see:
Quarterly
scription
al Trade
4
Indiana
For discussion of
Federal Trade Commission v.
Nims,
Trading
Commission,
Quartered
Trade-Mark
291 U.S.
Unfair
Unfair
Secondary Meaning,
§§
Case,
Unfair
Ed.
28-32
secondary meaning,
Oak
Competition;
Competition
24 Cornell Law
Cir., 1932,
;
Protection
Between De-
Competition—
Co.
§§
C.J.
v. Feder
Algoma
36-42;
58 F.
393-
13 Columbia Law
Ct.
Washington University
And makes me
Robs
But he that
Francis v.
Smith,
“Who steals
* * *
name
[*]
him
[******]
me of that which
Othello,
[*]
There was not entire
on two
whereat
such
points,
always
confusing
technical and
considerations
are not before
In dis-
us.
conception
complaint,
of missing
of malice and the
allega-
matter
he takes two
special damage.
professor
learned
tions
as true and so
bound
the as-
position
disparagement
takes
sertions
of malice and loss
of sales
quality
competitor
paragraphs
the rival
is not
29 and 32.18
qualified privilege
entitled
to the
If
the common law has been the tor-
rival claimant
for title and so malice need toise, equity assuredly has been the hare.
not be shown in forfeiture thereof.11 The This
surprising
equity
is the more
because
implicit
same view seems
in the Restate
came into
exactly op-
existence
interesting
ment of
Torts12
to posite
might
expect,
reason. As one
also
observe that
the more modern codes of
leading
judicial
article on the
slothful-
*4
business
ethics
follow the French
and ness in
penned by
this field has been
an-
proscribing
German law in
all
forms of
professor.
other
Law
Harvard
School
disparagement.13
may
truthful
be
pulverizes
precedents
learned Dean
the
“* * *
allegation
proof
special
and
damage is
quoted:
and ends
the
with
often
necessary
recovery,14
for a common-law
Most
grant
speak
of the cases that
relief
although even here one notices a relaxa
strongly
injustice
the
must
15 particularly
tion
where the trade libel
sult
from denial of
in these
includes assertions
of unethical business
cases.
In substance the traditional
doc-
very purpose
conduct.16 The
equi
puts
anyone’s
trine
mercy
business
at
remedy
table
indicates
there is
any
no of
insolvent malicious defamer who
need
any
applying
rigid
such
rule to has
imagination
lay
sufficient
to
out a
that side of the court.17
In the case
campaign
long
skillful
of extortion.
So
bar, however,
learned
court acted at as denial of
on
relief
such cases rests
competition
Corporations:
that unfair
is a tort of that
Torts:
Libel: Dis-
type
injured
paragement
defendant
where
of Product
or Business
plaintiff through
Methods,
Quarterly
the medium of
minds
13 Cornell
Law
persons.”
(note).
or influenced conduct
third
Competition: Property Rights
Unfair
As
Regulation Remedy
Trade
for “Dis
—
Action,
The Basis of
12 Cornell Law
paragement” Amounting to
Than
Less
Quarterly
(note).
Falsehood,
40 Columbia Law Review
11 Smith, Disparagement
Property,
(note).
342-343
cited, p.
says: “But,
above
139.
He
belief,
“On information and
defend-
hand,
competing
trader’s
false, misleading
ants have made the
and
disparage
quality
omission to
of his
disparaging statements,
rep-
claims and
goods
rival’s
does not
the loss
involve
alleged
resentations hereinabove
deliber-
goods. By
to
dis-
his title
his own
ately
maliciously
knowledge
and
with
paraging
goods
quality
of his rival’s
statements,
the fact that such
claims and
goods
he
to sell his
enabled
own
representations
are not
true and that
findings
advantage.
possibility
to better
But
contrary
they
to
are
enjoying
of his
this benefit does not fur-
respect
Federal Trade Commission with
why
nish a sufficient
the law
reason
proceed-
to the matters involved in the
upon
prima
pro-
confer
him
should
facie
ings in which the defendant Association
uttering
disparaging
tection
state-
participated
alleged
as above
defend-
ments, which turn out
to be untrue in
statements,
ants
such
claims
have made
damage.”
and which cause
P. 142.
fact
representations
injure
with intent
to
(1938)
Restatement of
impair
§§
Torts
destroy
and to
the credit and to
628;
Bower,
cf.
Code Actionable Def
competition
plaintiffs,
furnished
amation,
pp. 134,
Ed.
135.
Philippine
ma-
hogany.” Complaint, Paragraph 29, Ap-
other dealers in
and all
Propriete,
la
Annales de
Industrielle
(Annales) 1878,
gegen
Plaintiffs-Appellants brief,
pendix
Gesetz
den
to
Wettbewerb, Reichsgesetz
unlauteren
11-12.
(1909) 499;
blatt
cf. Isolfeu v. Wanner
a result
unfair
“As
and unlawful
d’Appel, Paris,
Annales, 1934,
Cour
of the anti-
violation
Alexandroff,
alleged,
reputa-
discussed
Concur
trust
as above
laws
Deloyale
(1935)
616-618;
good
plaintiffs
rence
No.
tion and
will of the
have
Reichsgericht
January 5,
damage
H. Z.
S.
loss
suffered
injured
MW
144.
in their
have been
business
14 Smith, Disparagement
Property,
property
lost sales to which
and have
Complaint,
justly
they
above cited.
were
entitled.”
15 Handler,
Appendix
Plaintiffs-Ap-
Competition,
Paragraph 32,
Unfair
brief, p.
pellants
Iowa Law Review
12.
or
obligations
carry out their
authority
duced not
stronger
our
basis than
no
persuaded
unfair
Pound, Equi- new customers are
way out.”
are sure to find a
rela-
means
enter into contractual
and In-
not to
Defamation
Against
Relief
table
practice
Re-
tions? One
other,
juries
Personality,
Law
29 Harvard
growth
cases the
and in both
view
plaintiff’s
are
business
success
eminence, it is
In view of
critic’s
seriously
Derenberg, Trade-
affected.”
necessary
much
his demoli-
to add
p.
Trading,
Mark
and Unfair
Protection
Chan-
advanced for the
tion of
reasons
22 Furthermore,
satisfied that
arewe
Later commentators
hesitations.
cellor’s
support
better rea-
ample
have
greeted with
have discussed
and have
them
soned cases.
away
edges
enthusiasm each decision
negation.19
doctrine
the traditional
just expressed make
The views
speech”
of “a
“free
The irrelevance of
unnecessary
us
elaborate
patent.
Freedom
jury”
libel is for a
plaintiffs’
ac
failure to state a cause of
public
not de-
discussion
issues does
Clayton
tion under
Sherman
Acts.
“previous
for in-
restraint”
mand lack
quite agree
We
learned district
Disparage-
jury
private
individuals.
respect.
judge
allega
The vital
confusing
goods presents
ment of
tions in such
action are similar
personality requir-
complicated matter of
conspiracy
gen
A
those in
civil
case.
peers.
sympathetic
one’s
ing
attention of
*5
allegation
conspiracy
eral
without a
repudiate
allegation
quite
facts
willing
We
statement of the
is an
are
legal
“waning
equity will
a
conclusion and insufficient of it
doctrine that
not
20
self
a
action. Al
restrain the
libel”. We
further
to constitute
cause of
trade
are
unnecessary,
plaintiffs
directly
though
willing
hid
detail is
to do so
and without
equitable principles
plead
constituting
must
facts
ing behind
con
21
spiracy,
put
object
accomplishment.25
In so
its
and
forward
some of the cases.
plaintiffs
pleaded
repeat
doing we
well
words of The
have
none
these
really
alleged
facts.
leading
a
writer:
“What does
Neither
the date of the
conspiracy
are in-
nor its
circumstances
matter whether old customers
attendant
practices.
judicial
law
from
clearly
Trade
pled
bar.
view
vania Law
ment”
hood,
view
Falsehood,
boycott,
Regulation Remedy
paragement”
30 and 31 of the
tition” Under
mission
spiracy”,
Law
Practices
Publication of
Statements
(note),
(note); Has
22The trend has
19
20
These are
Nims,
Trade
of unfair
judicial
with decisions
72
complete;
77; Disparagement
Quarterly
Libel,
40
Amounting
indicates
above cited.
still
Act,
or
reaction
(note).
such as is
as
Regulation Remedy
Unfair
Columbia
—
Its
“plan
or
Equity
Review
inertia have exerted
“Unfair
6 North
developing primarily
75
Amounting
Columbia
Disparagement,
breach
evolution
Libel?,
complaint
63;
University
survey
against
Competition by False
upon
been
Jurisdiction to
Federal
alleged
state
248
Methods
Law Review 341
—
scheme” and
Less Than
Carolina
Price-Maintenance
12
Law
described:
trust,
(note);
Iowa Law
in the case at
of Goods
Trade
recent cases
“Disparage-
Review
flux. Cou-
Less Than
paragraphs
19
precedent
developed
Law
coercion,
Pennsyl-
yet
Compe-
Cornell
Enjoin
False-
Trade
“con-
“Dis-
Com-
as a
Re-
Re-
far
re-
56, 311-313; Bates, Pleading, Practice,
Disparagement
Parties
presented
direct
cent
Co.
Cir.,
take
—Unfair
Rollman
Works,
cases discussed
ined
Review
unsatisfactory
§
to business.”
on the
legislative
6 North
Probably
ministrative
able trend towards
show
tarding
approach.
24 15
And
this
Baylies,
Maytag
increasingly
et
advantage
trend of
footnote 19 above.
35 F.2d
a
our
country,
U.S.C.A.
seq.
De
influence
application
distinctly
Carolina
Mfg.
it is safe
Cir.,
Competition,
the heart
decision
to discard
interest,
Vilbiss, D.C.,
Forms,
These
Co. v. Meadows
Pleading
agencies
Co. v. Universal Hardware
approach
Developments
decisions
403;
that some court will soon
§
important
are
Law
liberal
Goods
F.
prophesied:
greater
cases,
4th Ed.
of ethical
et
reveal
Alliance
many
commentators not-
and an
Review
(3d
say,
this indirect
seq.;
46
opportunity
and blaze
and
as Trade
together
24 F.2d
ed.
Harvard Law
insistence
an unmistak-
from the re-
others which
work
this
Mfg.
15 U.S.C.A.
in the Law
progressive
awakening
1929)
Securities
problem.”
standards
see other
“ * * *
§ 1161.
subject
Libel,
530;
here
trail
up-
ad-
the defend-
increasing the business of
make and
who
averred
is it
Nor
set forth.
amplified by a
allegations are
when,
whom. ants. These
where,
statements,
or
setting up
than
particulars
bill of
more
complaint is
dismissing the
The order
alleged that the
ways which it is
score
for fur-
reversed,
remanded
and the cause
plaintiffs’
defendants have libeled
with this
proceedings
ther
opinion.
in accordance
particulars
of the bill of
woods.
items
The
opinion of
court
up
are set
in full in the
Rehearing.
On
repeat
below
them.
need
up
the libel can be summed
whole of
CLARK,
MARIS,
BIGGS,
Before
allege that the de-
saying
plaintiffs
that the
GOODRICH,
Judges.
JONES, and
public that
tell the trade and the
fendants
ma-
plaintiffs sell are not
the woods the
Judge.
BIGGS, Circuit
dealer who sells
hogany at all and that a
unnecessary
it is
We think that
Philippine
mahogany
woods as
is uneth-
length
the conclusion
hearing to discuss
ical.
that the com-
judge
trial
of the learned
pro-
plaintiffs
injunction to
seek an
a cause
plaint
fails to state
as drawn
alleged
libels.
hibit
have moved
Acts,
Clayton
or
action under the Sherman
complaint.
to dismiss the
note,
1-7,
historical
15 and
15 U.S.C.A. §§
15 U.S.C.A. §
suit at bar
the commencement of the
Since
opin-
seq.
first
In our
12 et
Federal
pending
there has been
before
we see
in this view
ion we concurred
question whether
Trade Commission the
change our conclusion.
no reason now
mahogany” as
“Philippine
not the term
not the
question of whether
As to the
deceptive.
plaintiffs is
If
used
of action
a cause
plaintiffs have set forth
term
that the use
Commission holds
shall
competition, we
sounding in unfair
may prohibit
deceptive the
Commission
original
opinion. In our
later in
deal
using
See Federal
it.
Delaware a
decided that
opinion we
Act,
15 U.S.C.A.
Trade Commission
§
dispar-
libel or
for trade
action
cause of
*6
main-
then
plaintiffs could not
§
maintained
be
might
agement
goods
of
They
could
in
court.
tain their action
existence or non-ex-
regard to the
without
of the
of the order
Commission
seek review
conspiracy
com-
or unfair
of civil
istence
5(c)
by Section
prescribed
manner
in the
cor-
as to the
petition. Having some doubt
Act, 15
Trade Commission
of the Federal
point, we
this
decision on
rectness of our
facts were
45(c). These
U.S.C.A. §
shall endeavor to
rehearing. We
ordered
dispose
opinion
the court below
ferred to in the
deem
which we
all the issues
original opin-
in our
touched on
and were
shall de-
at bar but we
pertinent
case
to the
go
greater
into
necessary to
ion. It is not
opinion
the
part
this
to
the first
vote
detail here.
libel,
“pure” trade
question of whether
any ele-
without
say trade libel
is to
that
allege
The defendants
that
or civil con-
ment of unfair
suit at bar cannot
because
be maintained
equitable jurisdic-
aid to
spiracy
the law
of Delaware will not authorize
tion, may
enjoined.
be
enjoining
continuing
of a
libel. It is
fully
pleadings
in the case are set out
point
place
this
that the
their
opinion
in the
of the
D.
court below. See
greatest reliance. The defendants contend
C.,
F.Supp.
necessary
450. will
Tomp
Erie
that
kins,
rule of
Railroad
v.Co.
opinion
that
in order to understand
read
what we are about to
64,
817,
82 L.Ed.
U.S.
58 S.Ct.
say
shall re-
1188,
applies
citizen who undertakes deal with them as public acting subject men has had the England official conduct good interesting protected to note both name and will. Chancery McCormick of Delaware has receiver Court of Sellers was the *8 provision discharge part- Upon as the the constitutional Bros. construed they began by have us construe receiver to com- would ners pete the the defendants Liberty They Life Assurance announced the of with him. it. The case Society opening Liberty, 15 of of Del. of a “New home McCormick v. Heralds typical. Company” 634, Transportation In and thanked A. Ch. 138 Society Liberty for their continued Life Assurance filed “Our old customers case pirating patronage.” prevent a of Under literal construc- bill the its its stated, 5 I of Del- Chancellor tion uf of Article the name. The Section former by Constitution, publications page Del.Ch., page such aware of 15 638 of A., could not have been en- of com- the McCormicks [the choice its Chancellor, joined. however, incorporators plainant’s] had no named the injunction hesitancy issuing company appears in for the defendant of the purpose protection of the receiver creditors. the unlawful of have been publication point gave competing complainant unfairly at this of Freedom the way property. protection wrongfully profit- business, of The Sell- and of injunction expense.” See also ing case was decided ers was at its Inc., Stores, prevent competition, Radio Ameri- granted v. unfair American Corp., & Television Stores viz., Radio can use of a name defendant. McCormick, Del.Ch. A. v. In Sellers 19 Del.Ch. Chancery 165 A. the Court step from Firearms Co. v. very development equity jurisdic- decided Marlin same Shields, N.E. L. trespass, of ease- N.Y. over disturbance tion over see refers to ments, We also R.A. 310. Mr. Nims also and over nuisance. Corporation v. moving in the E. Hicks American case Robert Courts Association, direction, Training in- reaching such cases same National Salesmen’s directly admitted Circuit Court of laying hold of some 19 F.2d in which the Circuit, tacking while ex equity jurisdiction Appeals the Seventh head of concurrent rule that trade pressly acknowledging thereto what is in substance a itself, injuries through enjoined in and of jurisdiction legal over not be libel could injunc by way that an publication. say the cases this did of dictum In some obviously pleading that the furtherance might prevent matter of issue to so but a tion strong conspiracy court breach con be confident some to induce a a Smith, Manufacturing Co. v. presently will take the direct course tract. Allen supra, therein. & Traders Cor will be followed Most and Old Investors speak grant strongly of 232 N. poration Jenkins, relief v. Misc. cases article, denial Nims injustice result from in the that must also are cited Y.S. directly in these cases. In sub- cases over but neither any- puts though doctrine stance the traditional earlier rules the decisions mercy publishei insol- non-competing one’s business at vent, case cited a last enjoined publishing malicious defamer who has sufficient was trade libel. campaign Corporation lay imagination to out a skillful Investors & Traders The Old long position. as denial of relief support plaintiffs’ extortion. So case does stronger no basis cases rests on only in such we have been able case which authority courts are sure than our enjoining a trade libel to find where way find out.” was not fastened on some well-established equitable relief. hook of say, goes Nims on to “In the six- Mr. years since Pound’s teen this [Dean article] phrase “pure libel” But trade apparently has ‘strong court’ was written re has been called misnomer course’, willing to direct but been ‘take the ascribing at legal this tort the sulted in our have further cleared some of slander, particularly libel tributes of way outright that de- for an declaration defamation, the inherent characteristics of competi- disparagement of a famation or consequent application and in the competition goods tor’s is unfair and a equity will not dogma that a court of subject proper injunctive relief.” He enjoin continuing or slander.2 libel case, then cites “So-Bos-So” so-called Smith, App. Manufacturing Allen Co. be There is clear line of demarcation 692, 696, Dept. 4th N.Y.S. Div. which is often over tween the torts two alleged in existence The first is concerned with In case looked. infringe- in passing-off personality, trade-mark the other with terests 3 Thus, the Restatement rejected by property. the court which none terests was ment “Defamation”, enjoined disparagement false libel slander classifies the less product. Reputation”, plaintiff’s noted Interest court “Invasions of competition are not “Disparagement”, actions for unfair “Inva libels as passing-off Vendibility cases and dis- Interests sions of confined up- leading York cases A Property by Disparagement.”4 judicial New tinguished they were cases of ground that of this distinction on the consciousness against suits the consequent legal inc but attendant differences This was a of libels. decision “it publishers idents5 would the “confusion” avoid *9 2 Prosser, equity of the Law of Handbook the ment the rule interests that 1036-1040, p. enjoin (1941) pp. speech, 1037: of freedom of not the Torts will publication See, unfortunate association of “Because the of libel or slander.” supposed analogy ‘slander,’ also, illuminating to Jeremiah dis- with Smith’s hung cussion, Property” “Disparagement the like a has over tort defamation of concealing character, (1913) 13, 121, fog, real its 13 127- Col.L.Rev. develop- great influence has had 132. property 3 plaintiff’s Smith, supra p. 127; or Prosser, title ment. at su ’ regarded pra p. been as some- seems have 1040. 4 personified, Restatement, (1938) and so One defamed. 3 how Torts 24 chs. consequence important 28; 573, g. has been that § comment applied 5 many disparage- have The differences in the two torts are
236 applica- 797, L.R.A.,N.S., 874; has lead to” and 34 American [trade Malt libel] Keitel, ing analogies. specifical- Cir., tion of Or more Co. v. false 2 209 F. 358; ly the failure realize that the Apco Co., Cir., action Gerosa et al. Mfg. v. 1 disparagement place 19, 26; property Kane, of 299 C.C., F. Emack v. 34 F. law; 46, 50; Nims, its own in the is a mere Competi not The Law of Unfair branch, special variety, Marks, action Ed., 1929, of the tion and Trade Section personal reputation 263, defamation the seq. et Cf. Procter & v. Gamble Co. J. Co., Cir., action for deceit.”6 L. Prescott 3 102 F.2d Ex 773. cept for a pleading technical defect in the Assuming plaintiffs here have plaintiffs in the bar have stated case at pleaded nothing more than an action for a cause of action which is the basis for disparagement goods, say, is to equitable sought relief by them. libel, “pure” although under cer- tain circumstances such a libel also We will discuss that technical owner,7 constitute a defamation of defect now. The defendants assert relief, equitable so as to bar that obstacle the court jurisdiction below without was does not confront us the case at bar. controversy of the jurisdic because the granting equitable relief in need for tional amount was properly alleged not present, cases like the there are where complaint. complaint alleges genuine proprietary involved interests of exceeds, controversy “the matter in exclu great significance social and commercial costs, $3,- sive of interest and the sum of parties affected, urgent. is Dean * * * allege It does not that each Pound’s be characterization of the evils to damages three plaintiffs incurred this, proof is as convincing avoided are that sum. There is nothing the com was numerous cases where relief such plaint which indicates that it is a true class instances, sought. injustice In latter spurious obviously action. It class avoided, often has been have indi- 23(a) (3) suit. See Rule the Federal cated, by casting hooking for and onto a Rules of Procedure. Civil While allegedly independent remote but basis for plaintiffs they may join can in one suit not equitable relief.8 aggregate their claims in order to arrive at jurisdictional amount. The claim In the case at bar we are re plaintiff separate each depart severely distinct. See quired criticized Pinel, Pinel precedent. v. U.S. 36 S.Ct. The District Court found that 817; Bonding Surety L.Ed. Lion & competition Co. v. there was between the woods Karatz, plaintiffs 262 U.S. 43 S.Ct. 67 L.Ed. of the and those of the defend Independence Corporation Shares ants and that therefore there could be no Deckert, Cir., 108 F.2d reversed on competition. We think that the learned grounds U.S. Judge District took too narrow a view of 85 L.Ed. It follows that since no 189. question actually this and that the woods of action is stated under the anti cause of those defendants States, juris trust laws the United competition. are in The issue clearly disposed allegations complaint dictional are competition was not of in opinion. complaint conclude our first We now that insufficient and drawn complaint allegations viewed in timely proper must be dismissed unless light Rule 8 the Federal Rules be made in accordance amendment Procedure, 28 U.S.C.A. following stated, however, Civil 15(a). Rule should 723c, support section sufficient shows, that so far as the record before us charge of unfair question committed sufficiency allega joint pursuant to the acts of jurisdictional as to amount was not tions The courts and others. United in the court raised below was not raised remedy granted the of an in have argument upon States court until rehear Gomp junction under such circumstances. ing. ques This makes no difference. The Range Buck’s Stove & always ers v. open. tion of It has 418, 436, 437, S.Ct. L.Ed. argument U.S. raised before us been on Smith, supra, pp. 127-132, supra Prosser, in: listed and note Prosser, supra, 10-11, Pound, Equitable Against Restate Relief Defama- ment, (1938) p. Injuries Personality, supra, Torts tion and *10 6 Smith, supra, p. 13, 14. Prosser, supra, Restatement, (1938) 573, Torts comment g. § however, court, This con- rehearing. could question upon its own motion. sider the necessary al- jurisdictional Without legations, complaint cannot be main- Maurer, tained. Mitchell v. 293 U.S. See L.Ed. carefully the We have considered motion strike certain plaintiffs sentences opinion original and substitute our place. The in their reasons words why Trade Commission the Federal opened par- controversy between ties are known best Commission de- not The motion will be to ourselves. nied. out plaintiffs’ motion strike “Relevant
the document entitled Portions ‘Philippine Mahogany1 Record Case” granted not will document was before District We will not Court. portions strike the defendants’ out those brief deal with this document. part Briefs record. judgment the court is re- below versed cause is and the remanded the direction to the court below allow opportunity a reasonable complaint in amendment of accordance provisions 15(a) with the Rule Federal of Civil Procedure. Rules Judge part CLARK took no rehearing. in this case on decision
HIGGINS v. COMMISSIONER OF INTERNAL REVENUE.
No. 3755. Appeals,
Circuit Court of First Circuit.
June