Industrial Mutual Deposit Co. v. Central Mutual Deposit Co.

Opinion of the court by JUDGE HOBSON Affirming. Appellant, the Industrial Mutual Deposit Company, filed this suit in the Fayette circuit court to obtain an injunction protecting it in the use of its corporate name, and preventing injury to its business. The court sustained a deinurrer to the petition, and dismissed the action. The petition set forth these facts: The plaintiff, the- Industrial Mutual Deposit Company, was incorporated on May 7, 1900. The defendant, the Central Mutual Deposit Company, was incorporated in January, 1901. The articles of incorporation of both are similar. The business in which they are engaged, and the method of conducting it,' are the' same. [940] The principal office of both is located in the city of Lexington, in the Merrick Lodge Building. Many of the promoters of the defendant before its organization were connected with plaintiff. They were induced to organize the defendant company, to designate the Merrick Lodge Building as the chief office of the company, arid to select for it the name, “Central Mutual Deposit Company,” which differs from that of the plaintiff only by the substitution of the word “Central” for the word “Industrial,”' with the purpose and intent of drawing away from plaintiff its customers and client-age, and of promoting the business of the defendant, to the injury of the plaintiff’s business. By this means it has 'seriously damaged the plaintiff, and has drawn away from it many of its customers. The demurrer admits as true the allegations of the petition. The general principle that a corporation’s name is its property, and that equity will protect the corporation from a fraudulent use of another name so like it as to deceive the public and rob it of its business, is admitted. Thus, in Elliott on Private Corporations (section 48) it is said: “The rule most consistent with principle is that a corporation will be protected in the use of its name upon the same equitable principles which protect persons in the use of trading names and trade-marks.” ’ There is, however, 9ne well-recognized exception to the rule, and this is that a trade-name consisting simply of a generic term will not be protected. Thus, in Canal Co. v. Clark, 13 Wall., 311, 20 L. Ed., 581, the plaintiff sold his coal under the trade-name of “Lackawanna.” The defendant’s coal also came from the Lackawannavalley,and hedesignated itas“Lackawannacoal.” The court held that the name of a district could not thus be appropriated exclusively, and after saying that sudh phras [941] es as “Pennsylvania wheat,” “Kentucky hemp,” “Virginia tobacco” could not be protected, it added: “Nor can a generic name, or a name merely descriptive of an article of trade, or its qualities, ingredients or characteristics, be employed as a trade-mark, and the exclusive use of it be entitled to legal protection.” In the subsequent case of Goodyear’s India Rubber Glove Mfg. Co. v. Goodyear Rubber Co., 128 U. S., 598, 9 Sup. Ct., 166, 32 L. Ed., 535, the court held that a corporation would not be protected in the name of “Goodyear Rubber Company.” If said: “Names which are thus descriptive of a class of goods can not be exclusively appropriated by any one. The addition of the word ‘company’ only indicates that parties have formed an ¡association in partnership to deal in such goods, either to produce or to sell them. . . . Names of such articles can not be adopted as trade-marks, and be thereby appropriated to the exclusive right of any one; nor will the incorporation of a company in the name of an article of commerce, without other specification, create an yexclusive right to the use of the name.” To the same effect, see Avery v. Meikle, 81 Ky., 85 (4 R., 759). Under these principles, it would not be maintained that a corporation doing business under the name of the Industrial' Mining Company could enjoin another corporation from doing business in the name of the Central Mining Gompany, or one doing business as the Industrial Lumber Company could enjoin another from doing business as.the Central Lumber Company. The words which are identical in the names in controversy are “Mutual Deposit.” But these words designate the business followed by the company and are generic terms descriptive of that business as fully as the word “lumber” would be in the case supposed, or the word “mining,” and just as the [942] word “trust” is in the names of the numerous trust companies operating in the State. Both the corporations are doing a mutual deposit business, and as the name is descriptive of the business, neither can appropriate it exclusively. Judgment affirmed.