Menendez v. Holt - 128 U.S. 514 (1888)
U.S. Supreme Court
Menendez v. Holt, 128 U.S. 514 (1888)
Menendez v. Holt
Argued November 14, 1888
Decided December 10, 1888
128 U.S. 514
A combination of words, made by a firm engaged in mercantile business, from a foreign language in order to designate merchandise selected by them in the exercise of their best judgment as being of a certain standard and of uniformity of quality, may be protected to them and for their use as a trademark, and does not fall within the rule in Manufacturing Co. v. Trainer, 101 U. S. 51.
The addition of the infringer's name to a trademark in the place of the owner's does not render the unauthorized use of it any less an infringement.
When a partner retires from a firm, assenting to or acquiescing in the retention by the other partners of the old place of business and the future conduct of the business by them under the old name, the goodwill remains with the latter as of course.
A trademark may be part of the goodwill of a firm, and in this case it was part of the goodwill of the appellee's firm.
A person who comes into an existing firm as a partner and, after remaining there a few years, goes out, leaving the firm to carry on the old line of business under the same title in which it did business both before he came in and during the time he was a partner, does not take with him the right to use the trademarks of the firm in the absence of an agreement to that effect.
The intentional use of another's trademark is a fraud, and when the excuse is that the owner permitted such use, that excuse is disposed of by affirmative action to put a stop to it, and no estoppel arises.
The case, as stated by the Court, was as follows:
Appellees, partners in business under the firm name of Holt & Co., filed their bill of complaint July 17, 1882, against appellants, engaged in business under the firm name of Jose Menendez & Brother, alleging that they were dealers in and bought and sold flour and grain; that Robert S. Holt had theretofore been for more than twenty-five years at the head of the firm of Holt & Co., which firm had from time to time been changed or dissolved by the retirement of various members, but in each such instance a new firm had been immediately formed and succeeded to the firm name, goodwill, brands, trademarks, and other assets of the preceding firm, so that there had been no interruption of the name and business identity of Holt & Co. for over twenty-five years, during which time said firm had had a high reputation in the trade; that complainants were now legally seized of the goodwill and all the trademarks ever at any time used by the firm; that they were the owners of a certain trademark for flour, which consisted of the fanciful words "La Favorita," which was originated by the firm, and had been used by it for more than twenty years, to distinguish a certain flour of their selection and preparation; that said firm at all times exercised great care in the selection, packing, and preparation of the flour packed and sold by them under the said brand "La Favorita," and had carefully advertised the same, and by their care and efforts extensively introduced it to the trade, so that the said brand had come to be widely known and sought after by the trade, and the sale of flour so branded constituted an important part of the firm's business; that the brand was applied by stenciling it on the barrels, and that it had been duly registered by the firm in pursuance of law. Defendants were charged with having made use of the brand as a mark for flour of their own preparation or selection, in violation of complainants' rights.
The answer admitted the existence of the trademark and that the defendants had used it, but denied that Holt & Co. were the owners and averred that one Stephen O. Ryder was a member of Holt & Co. from 1861 to 1868, and had since used, and was entitled to use, said trademark as his own; that said Ryder put his own name on flour in connection with the name "La Favorita;" and that defendants had sold such flour as the special selection of said Ryder, and not as selected by complainants.
Evidence was adduced in relation to the connection of Ryder with the firm of Holt & Co., his retirement therefrom, and the ownership of the brand thereupon, to establish the use of the trademark by Ryder and others without protest on complainants' part; also, subject to objection, to show a prior use of the same as a trademark for flour.
It appeared that Holt & Co. deposited facsimiles of the trademark October 17, 1881, in the Patent Office, and that it was duly registered February 28, 1882.
The circuit court refused an accounting, but held complainants entitled to the exclusive use of the words as a brand or trademark for flour, and that the defendants had infringed the rights of complainants in the use of the words on flour not prepared by complainants, and decreed a perpetual injunction. From that decree this appeal was prosecuted.