Rahtjen's American Composition Co. v. Holzappel's Composition Co.

SHIPMAN, 'Circuit Judge. John Rahtjen invented, in Germany, between the years 1860 and 1865, paints specially prepared to protect the hulls of steel and iron ships from rust, and also from becoming covered by growths animal or vegetable in character. In connection with his sons, he began in 1865 to manufacture for general use, and the paints speedily acquired a high reputation in the maritime world, under the name of “Rahtjen’s Composition.” After his death in 1S73, the business ivas continued in Germany by his sons, and is now carried on by John Rahtjen and Heinrich Rahtjen, under the firm name of John Rahtjen.' In 1869, the Rahtjens made Henry Gelien, of Hoboken, their exclusive agent to sell their paint in the United States, with the provision that it shall be brought on the market under the name of “Rahtjen’s Composition,” and -with the information that no patent would be applied for in this country. Gelien issued a show card for the purpose of advertising the paint under its trade-name, copyrighted the card, advertised the paint in other ways, and sold it under this trade-name to the extent of about $17,500, until the end of 1877, when he was succeeded by Hartmann, Le Doux & Maecker. In January, 1878, Suter, Hartmann & Co., of London, were appointed sole agents for the sale of the paint in this country, for -whom the Hartmann firm acted as subagents for a time. The Suter Company was succeeded in 1888 by the Suter, Hartmann & Rahtjen Composition Company, Limited, which was succeeded in 1891 by the complainant corporation, which was organized under the laws of the state of New York. During the entire period from 1869 to the commencement of this suit, the goods were continuously advertised and sold under the name “Rahtjen’s Composition,” and the value and commercial importance of the article which Rahtjen originated, and which, as made by his firm and their successors and sold in this country, has been distinctly and widely known. The packages which came ,to this country from 1869 to July, 1879, were sent from Germany, and were marked “Rahtjen’s Composition” or “Rahtjen’s Patent Composition.” From 1879 to 1883 upon each package which came to this country from the complainant’s predecessors were stenciled the words “Rahtjen’s Composition” in some form. Since 1883. the drums which contain the paint have been marked: • Genuine Rabtjen’s Composition Trade (Symbol of open band) Mark. Hartmann's Manufacture. The origin of the words “Hartmann’s Manufacture” will be stated hereafter. The complainant’s gross business in this paint in 1897 was $128,300, in 1898 -was $145,200, and in the last six months of 1898 [259] was § 106,000. The firm of John Eahtjen has continued to manufacture in Germany without patent protection, in 1871, the English firm of Suter, ilartmann & Go. was formed to- sell “Rahtjeu’s Composition” in England, and became the sole agents of the firm of John Eahtjen for that purpose. All the paint was manufactured in Germany by the Eahtjens until 1874, when they built a factory in Liverpool, having obtained on November 29, 1873, an English patent for the product. They continued the manufacture in Liverpool until February, 1880, when they assigned their leasehold interest in the factory and the patent, and the exclusive right to manufacture the paints for sale in Great Britain and tlie United States, to Hartmann Bros., who carried on the manufacture, under an agreement with the Eahtjens, from 1880 until the Suter, Ilartmann & Eahtjen ‘Composition Company, Limited, was formed in 1888. Suter, ilartmann & Co. remained the salesmen until 1888, when the corporation became both the manufacturers and the vendors. The English patent, which was apparently the only one ever taken out for the paint, was forfeited for nonpayment of dues ou November 29, 1880. During the manufacture by Hartmann Bros, the Eahtjens were also manufacturing in Germany, and to distinguish the English product Hartmann Bros, marked their drums “Hartmann’s Manufacture,” and adopted in 1883 an open hand, usually colored red, with the word “Composition” above, and the' words “Hartmann’s Manufacture”- below, the hand, as their trade-mark for all their paints, including Eahtjen’s. Suter, Hartmann & Eahtjen Composition Company, Limited, obtained the same trade-mark in the United States in 1889. Hartmann, Le Doux & Maecker had obtained a United States trade-mark in 1885 for the words “Eahtjen’s Composition.” The complainant is the owner of the good will and trade-mark rights of its predecessors, and is their successor in ownership thereof. The assignment of the trademark of 1885 by Hartmann, Le Doux & Maecker to Ilartmann Bros, was not apparently acknowledged, and has not been proved by the witness to the signature. In 1883, after the Eahtjen patent expired, three brothers, under the name of Holzappel & Co., commenced to manufacture “Eahijen’s Composition” in connection with their other paints, and in 1890 became a joint-stock company under the name of Holzappel’s Composition Company, Limited, which was organized! under the laws of Gloat Britain and is the defendant. A. C. Holzappel, who joined them in 1887, had been from 1875 to November, 1881, an agent of Suter, Hartmann & Co., or connected with them or with a member of that firm, in the sale of “Eahtjen’s Composition.” In 1890 the defendant or its predecessors began to send its “Eahtjen’s Composition” and other paints to John A. Donald & Co. of New York for sale, and in 1.894 the defendant took the business, and has since carried it on in this country in its own name. It manufactures and sells other paints, the leading brand being called the “International,” which kind it makes special effort to sell. The business of the defendant in the United States from 1890 to 1895, including a few small invoices sent to different persons from 1883 to 1890, amounting to about 92 cwt., was a fraction over 2,142 cwt. It has always been sold as “Eahtjen’s Composition, Holzappel’s Manufacture,” and no [260] effort has been made to conceal the fact that the defendant was the manufacturer. After ,the English patent expired, the successors of Bahtjen attempted to obtain an English trade-mark bearing the name of “Bahtjen,” but were unable to do so, except upon a disclaimer of an exclusive use of the words “Bahtjen’s patent composition for ships, bottoms, buoys, etc., or of any of such words, except as a part of the combination constituting our trade-mark.” Although minor issues of fact were presented in the proofs, the facts which have been recited are those of chief importance in the case, with the exception of those bearing upon the question of laches. The defendant’s case rests mainly upon the position that, after the forfeiture in 1880 of the English patent of 1873, the name “Bahtjen’s Composition”1 became generic in this country, and the article could be manufactured and sold in this country by any person, who described himself as the manufacturer. Reliance is placed upon the case of Singer Mfg. Co. v. June Mfg. Co., 163 U. S. 169, 16 Sup. Ct. 1002, 41 L. Ed. 118. It appears that the firm of John Bahtjen introduced their paint into this country in 1869, and preferred not to attempt to obtain the protection of a patent, but to gain both reputation and protection by the character of the article, and for that purpose required that it should be sold as their product, and under a trade designation. That system has been continued by each owner of the business in. this country to the present time, and the name of the inventor has become fastened upon the products. If a trade-mark exists in this country in the name of “Bahtjen’s Composition,” the complainant is the owner of it by virtue of the right of succession, as stated in the well-known case of Le Page Co. v. Russia Cement Co., 2 C. C. A. 555, 51 Fed. 941: “It is equitable that a manufacturer or dealer, who has given reputation to any article, should have the privilege of realizing the fruits of his labors by transmitting his business and establishment, with the reputation which has attached to them, on his decease to his legatees or executors, or during his lifetime to purchasers; and it is also in accordance with the principles of law, and with justice to the community, that any trade-mark, including a surname, may be sold with the business or the establishment to which it is incident, because, while it may be that individual efforts give them their value at the outset, yet afterwards this is ordinarily made permanent as a part of the entire organization, or as appurtenant to the locality in which the business is established, and thenceforward depends less on the individual efforts of the originator than on, the combined result of all which he created.” It further appears that after 1869 the only patent which was ever taken out in any country for the paint was the English patent of 1873, which lapsed by Hartmann & Bros.’ nonpayment of dues in 1880. The asserted consequence is that, because the name then became publici juris in Great Britain, it became public property everywhere. There was in 1880 a valid trade-mark right in the United States, -which the Kahtjens and their successors had acquired. The lapse of the English patent neither broke this trade-mark nor interfered with the.title of its owners. They owned it, and, although the lapse of the English patent interfered very seriously with their title to exclusive rights in Great Britain, it was ineffectual upon title in another country. In England the Bahtjens undertook- to acquire ex; [261] elusive rights by virtue of the patent laws. In the.United States they had previously acquired exclusive rights by the common law; Their failure in England does not cause a cessation of their common-law rights in the United States. The lapse of the English patent could not cause a lapse of trade-mark rights throughout the world. The Singer Mfg. Co. Case, supra, had exclusive reference to the continuance of a monopoly in this country upon which letters patent of this country had expired, and the court held that the right to use the name passed to the public in this country with the expiration of the exclusive right created by the patent to make and sell the ar-, tide. The decision followed the previous general course of decisions in the courts of this country and elsewhere, but it did not relate to. the facts of this case, as obviously appears in the opinion of Mr. Justice White, who spoke for the court. In the Scotch and English and French sewing-machine cases for an injunction against the use of the name of the maker, wherein the injunction had been granted, the machines had not been patented in those countries. In the French case of Howe, where the French courts enjoined the use of; that name on a sewing machine, the court, as a basis of its decree, used the following language: “Anfl whereas, they [Howe and his heirs] did not take patents in France for the invention and their improvements, which have therefore fallen into the; public domain, and have never, either expressly or tacitly, abandoned the right to affix his name [that of Howe] to the products of the invention.” Singer Mfg. Co.’s Case, 163 U. S. 195, 196, 199, 16 Sup. Ct. 1014, 41 L. Ed. 129. It is a matter of common knowledge that Howe took out patents upon his machine and its improvements in this country. Attention is called by the defendant to two continental decisions, one of the Brussels court of appeals and the other of the criminal, chamber of the land court at Hamburg, in cases respecting the exclusive right of the Rahtjens to the trade-mark.- The Brussels deck' sion was based upon the fact, as found, that in Belgium the name indicated an article, and not the maker. The attempt is made in this case to show that in the public mind in tbis country the name of “Rahtjen’s Composition” is a descriptive name, which is understood to designate a thing, and not its origin; as, for example, the word “hansom,” when applied to a cab, now means simply a particular style of vehicle. We are not able to find from the record, as a. fact, that in the United States the name “Rahtjen’s Composition” has become a generic name, and now means a composition made by any one after the original formula of Rah tjen. A few witnesses say that they supposed that the complainant and the defendant were competitors in the manufacture of an article called by the same name, but the testimony does not show that the fact exists in this country, which was found by the Brussels court of appeals, that: “In the eyes of the public, this name of ‘Rahtgen’ has become a sort of qualifying adjective, indicative of this special product.” The Hamburg case was a criminal one, founded upon a criminal statute, and the representatives of Holzappel were not found to have committed the offense which was defined by the existing statute, and [262] which was, in substance, having knowingly made untrue statements of fact. The defendant next insists that the complainant’s laches should prevent any decree in its favor. It is true that the defendant has sold its manufacture of “Rahtjen’s Composition” to a certain extent since 1890, but the sales have been comparatively small, and did not interfere with the complainant’s business to any marked extent, until the defendant obtained a contract with the naval department of the United States government, in answer to a call for offers of “Rahtjen’s Composition,” when suit was promptly commenced. The defendant’s chief brand of paint is the “International Composition,” and it has been their endeavor to sell that brand, if they could, “and, failing that, ‘Rahtjen’s Composition.’ ” The defense of laches is nominal, rather than real, for the defendant’s interference with the property rights of the plaintiff was for many years inconsiderable, and under no decision merits a refusal of a decree of injunction. Under all the circumstances of the case, we are not inclined to direct a decree for an accounting. The decree of the circuit court (97 Fed. 949) is reversed, with costs, and the case is remanded to that court, with instructions to enter a decree enjoining the defendant from selling or offering to sell paint under the name of “Rahtjen’s Composition,” and from using that name upon its, packages or in its advertisements as belonging to paint of its manufacture, in accordance with the foregoing opinion, and for costs of that court.