§ 55. Restraint in the Sale of a Trade-Mark.-The general principles under which the sale of patents is upheld are applicable to the sale of trade-marks. A trade-mark under which a profitable business in the manufacture and sale of any article has been established is of value, and any reasonable contract relating to it will be sustained. The idea of a trade-mark, like that of a patent, is to protect a monopoly or a restraint of trade, and the sale of a trademark, where the restraint imposed is not greater than necessary and reasonable, will be upheld. In the leading case on this point, where B, the proprietor of a medicine known as "Brewer's Lung Restorer," sold the same with the exclusive right to manufacture and sell it, surrendered his trade-mark to the purchaser, and agreed "never to use or permit my name to be used on any preparation which would be recommended and sold for the same purposes as Brewer's Lung Restorer is used and sold for," such contract is in partial, not general, restraint of trade; and being for a valuable consideration is not unreasonable. Such contract does not limit the skill of the vendor in compounding medicines for the cure of throat and lung diseases, but stipulates that his name shall not appear with his consent on such medicines. The publishing and offering for sale of "Brewer's Sarsaparilla Syrup, professing to be a permanent cure for all diseases of the lungs and throat" is a violation of the contract; and the vendor being insolvent, equity will enjoin such action.1 In the opinion in this case, Brewer v. Lamar, 69 Ga. 656. "Within a month subsequent to the death of the senior partner of the firm, his executors sold and conveyed all the interest of the decedent in the business to the surviving partner and complainant whereby they, under the firm name of Fleming Brothers, acquired not only the title to the receipt and the right to make the pills, but also the right to use the labels and trade-marks used by the former owners. Possessed of the whole interest, they (the firm Fleming the court said: "But are the covenants of this contract in general restraint of trade? The stipulation which it is alleged is void for this cause is in these words: 'I agree never to use or permit my name to be used on any prepara ventor or proprietor of the article made by him, and on which he puts his trade-mark, nor whether the article made and sold under his trade-mark by the respondent is equal to his own in value or quality; but the court proceeds on the ground that the complainant has a valuable interest in the good will of his trade or business, and having a particular label, sign or trademark, indicating to his customers that the article bearing it is made or sold by him or by his authority, or that he carries on business at a particular place, he is entitled to protection against one who attempts to deprive him of his trade or customers by using such labels, signs or trade-mark without his knowledge or consent. Coats v. Holbrook, 2 Sandf. Ch. 586; Partridge v. Menck, 2 Barb. Ch. 101; s. C., 47 Am. Dec. 281. Everywhere courts of justice proceed upon the ground that a party has a valuable interest in the good will of his trade, and in the labels or trade-mark which he adopts to enlarge and perpetuate it. Hence, it is held that he, as proprietor, is entitled to protection as against one who attempts to deprive him of the benefit resulting from the same, by using his labels and trademark without his consent and authority. Decided cases to that effect are quite numerous, and it is doubtless correct to say that a person may have a right in his own name as a trade-mark as against a trader or dealer of a different name; but the better opinion is, that such a party is not, in general, entitled to the exclusive use of a name merely as such without more. Millington v. Fox, 3 Myl. & Cr. 338; Dent v. Turpin, 2 J. & H. 139; Meneely v. Meneely, 62 N. Y. 427; s. C., 20 Am. Rep. 489. * Such a proprietor, if he owns or controls the goods which he exposes to sale, is entitled to the exclusive use of any trade-mark adopted and applied, by him to the goods, to distinguish them as being of a particular manufacture and quality, even though he is not the manufacturer and the name of the real manufacturer is used as part of the device. Walton v. Crowley, 3 Blatchf. 440; Emerson v. Badger, 101 Mass. 82." Clifford, J., in McLean v. Fleming, 96 U. S. 245. See also Williams v. Johnson, 2 Bosw. 1; Leidersdorf v. Flint, 8 Biss. 327; Taylor v. Carpenter, 2 Sandf. Ch. 604; s. C., 42 Am. Dec. 114; Hall v. Barrows, 4 De G., J. & S. 158; McAndrews v. Bassett, 4 De G., J. & S. 386; Maxwell v. Hogg, L. R. 2Ch. App. 314; Lawson v. Bank of London, 18 C. B. 84. "The principle on which all cases on the subject of trade-marks unite is, that one man will not be permitted, by imitating the distinctive name or mark used by another to designate articles of the latter's manufacture to impose articles of his own manufacture upon the public as the articles of the former. The cases so holding rest upon two considerations: First, that it would be a fraud on the rights of the former person thus to permit his trade-mark to be imi tion which could be recommended and sold for the same purpose.' Defendant below had already stipulated and did sell all his interest with trade-mark, etc., in the 'Lung Restorer,' to the defendants in error. Then in the stipulation above he agrees further 'never to use or permit his name to be used on any preparation which could be recommended and sold for the same purpose.' This stipulation does not forbid him to manufacture or sell such preparation as he tated. Second, that it would also skill, perseverance and business be a fraud on the public. See Gil man v. Hunnewell, 122 Mass. 139; McLean v. Fleming, 96 U. S. 245, 251; Coleman v. Crump, 70 N. Y. 573; Fairbanks v. Jacobus, 14 Blatchf. 337; Devlin v. Devlin, 67 Barb. 290; s. c., 25 Am. Rep. 173; Amoskeak Mfg. Co. v. Garner, 54 How. Pr. 297; Curtis v. Bryan, 2 Daly, 312; s. C., 36 How. Pr. 33; Amoskeag Mfg. Co. v. Spear, 2 Sandf. 607; Peterson v. Humphrey, 4 Abb. Pr. 394; Howe v. Howe Machine Co., 50 Barb. 236; Sykes v. Sykes, 3 B. & C. 541; s. C., 10 E. C. L. 176; Burgess v. Burgess, 3 De G., M. & G. 896, 904; Burke v. Cassin, 45 Cal. 467; s. C., 13 Am. Rep. 204; Emerson v. Badger, 101 Mass. 82; Ellis v. Zeilin, 42 Ga. 91; Lord Kingsdown in Leather Cloth Co. v. American Leather Cloth Co., 11 H. L. Cas. 538; Perry v. Truefitt, 6 Beav. 66; Walton v. Crowley, 3 Blatchf. 448; Dixon Crucible Co. v. Guggenheimer, 1 Cox's Man. of Trade-Mark Cases, 559. * There are some quasi proprietary rights, such as an elective franchise, which are incapable of assignment. But it would be obviously unjust to restrict the right to use a trade-mark. The advantages which accrue from the use of a particular trade-mark or advertising device are often the result of a lifetime of integrity, capacity. Ought it to be held that a right so valuable should die with the person who created it, it being incapable of assignment, when, by reason of age, or other considerations, he might desire to cease using it? The custom of trade. which solves many questions in advance of the courts, has declared that this should not be, and the courts in adopting the view that the right to use a trade-mark is assignable, did no more than declare a result which followed from the concession that it was property; for the jus disponendi is embodied in the very idea of property. It is, hence, settled law that the right to use a trade-mark is not a mere personal privilege, but that, within certain limits, it is capable of being bought and sold as other property. 'A trade-mark,' says Strong, J., 'like the good will of a store or manufacturing establishment, is a subject of commerce, and it has been many times held entitled to. protection at the suit of vendees.' Fulton v. Sellers, 4 Brewst. 42. See also Bury v. Bedford, 33 L. J. Ch. 465; Hall v. Barrows, 33 L. J. Ch. 204; Glenn, etc. Mfg. Co. v. Hall, 61 N. Y. 226; s. C., 19 Am. Rep. 278; Peltz v. Eichele, 62 Mo. 171." Thompson, J., in Skinner v. Oakes, 10 Mo. App. 45. may compound, or either, but that he will not himself use his name or permit his name to be used on any such preparation. The only restraint the covenant imposes on him is that his name shall not appear by his consent on such preparation. Can this stipulation be said to be in general restraint of trade, or is it not rather a partial restraint, and is it at all unreasonable? The absence of his name may limit the sales of any new preparation he may compound; the preparation may be wanting in the magic word, but for its absence he contracted and received a consideration therefor. He may compound and sell a score of other nostrums to cure the diseases for which the Lung Restorer is fitted; the only inhibition is he must not put on them the cabalistic word 'Brewer,' and thus violate the contract which he has entered into. That he has done this, the evidence abundantly shows, when he published and offered upon the market 'Brewer's Sarsaparilla Syrup, professing to be a permanent cure for all diseases of the lungs and throat.'"'1 The $ 56. Restriction in Publication Contract.-In covenants relating to the sale of periodical publications by publishers, or to the sale of articles written for such publications by the authors, such restrictions as constitute a necessary and reasonable protection to the vendee will be upheld. In Ainsworth v. Bentley, the plaintiff had purchased of the defendant a well established magazine. contract relating to the sale provided that the defendant should not publish another periodical of a similar nature. Fourteen years later the defendant entered into an arrangement to become the publisher of "Temple Bar," a publication of a like character and within the restriction of the contract. On the trial it was claimed by counsel for the defendant that the agreement was void as in restraint of trade and unlimited, and also that magazine publishing was a trade of itself. It was held that an agreement by a publisher not to publish in future a magazine of a particular 1 Brewer v. Lamar, 69 Ga. 656, 660. description, is analogous to an agreement by a tradesman not to deal in a particular article, and, like this latter agreement, is not void as a too general restraint of trade.1 In a case in Massachusetts, the court said: "In this country there are periodical publications that have a very wide circulation, and it is obvious that a purchaser of the proprietorship cannot afford to pay the full value, unless he can obtain from the vendor a valid restriction against competition, which restriction shall be so extensive as his interest requires, although it may cover the whole of a State, or the whole country. The same would be true as to some books. For example, the author of a popular school book could not sell its proprietorship for its full value unless he could bind himself not to prepare another book which should be used in competition with it." In October, 1857, A, being the proprietor of a weekly publication called "The London Journal," the price of which was 1d., assigned his copyright and interest therein to B for value, and entered into a covenant with B not to publish either alone or in partnership with any other person any weekly periodical of a nature similar to "The London Journal." In May, 1859, he issued an advertisement announcing the publication by him on the 1st June following of a daily newspaper to be called "The Daily London 1 Ainsworth v. Bentley, 14 W. R. 630. The chief defenses that had been raised were-first, that the agreement was illegal as being too general a restraint of trade; and, secondly, that the agreement was so vague and uncertain that the court could not restrain an infringement of it. As to the first defense, it had never been decided that a person could not be compelled to observe and keep an undertaking not to sell or deal in a particular article of trade. On the contrary, it had often been held that the proprietor of an article might dispose of it to another and legally bind himself never again to deal in that article, or in any article professing to be similar to or identical with it. This was the case here. Mr. Bentley had disposed of his Miscellany to the plaintiff and had undertaken to publish nothing of the kind afterwards. By being bound to abide by that agreement he would be no worse a publisher than he was before; he would only be precluded from publishing anything of a particular kind." Ibid., p. 632. 2 Morse Twist Co. v. Morse, 103 Mass. 73, 77. |