Reports of Patent, Design, and Trade Mark Cases

The Cellular Clothing Company v. Maxton and Murray.

"since (1888). The sale of said cloth and clothing is now very large, and is annually increasing. The Pursuers have advertised Cellular' cloth and "clothing very extensively throughout the world, and in all such advertise"ments the term Cellular' is used. Pursuers on all their goods sold or offered "for sale have used the word or name Cellular' to mark and designate their 5 "goods, and to indicate that the goods so marked or designated are of their "make or supplied by them, and it has come to be, and is now known and recognised by the trade and by the public as distinctive and designative solely "of goods made or supplied by the Pursuers. The said word or name 'Cellular' "never was used to designate or mark cloth or clothing or other such material 10 or fabric in the market or to the public until the Pursuers did so, and when "the trade or the public ask for or order cloth or clothing under the name "Cellular' they expect and intend to be supplied with the Pursuers' goods "and no others.'

With regard to the Defenders' action they stated :- "In or about February or 15 "March 1897, the Pursuers discovered that the Defenders were selling, and "offering for sale, and had sold, shirts and underclothing and cloth under the name Cellular,' which were not made or supplied by the Pursuers, and that "in their pattern or quotation books, which they issued to the trade, they were "systematically using the word 'Cellular' to designate and classify goods 20 "which were not of the Pursuers' manufacture, and that in such manner as to "make purchasers believe that said goods were Pursuers' goods. This the "Respondents did, and it is believed are doing, in the knowledge, as is averred, "that the trade and the public understand by 'Cellular' goods, goods manu"factured or supplied by the Pursuers, and with the intention, or at all events 25 "with the result, of diverting the Pursuers' trade, or of causing goods to be passed off under the name Cellular,' or as the Pursuers' goods, which were "not supplied or made by the Pursuers, but by the Defenders themselves. "The Defenders, moreover, sent pattern books, among others, to Mr. Stephen "Brown, hosier, Kelso, with ranges or classes of goods catalogued as 'Cellular,' 30 "which are not made or supplied by the Pursuers, and they invoice Cellular' "and advertise such goods under said designation, to the Pursuers' great loss. "On the Pursuers complaining to the Defenders of their marking and selling goods as and under the designation, name, or mark 'Cellular,' which had not "been made or supplied by the Pursuers, and requesting them to discontinue 35 "their unwarrantable proceedings, and as they assert their right to continue to "sell goods so marked or designated which have not been made or supplied by "the Pursuers, and so to represent to the public thereby that such goods are "made or supplied by the Pursuers, this action has become necessary. It is "believed and averred that the Defenders have issued such pattern and 40 "quotation books, invoices, and advertisements, as are complained of, at "intervals in the course of the past year or two, and have thus succeeded in getting orders for goods which they would not have got if said books and "advertisements had not been marked 'Cellular.' The Pursuers have suffered "and will suffer great loss through the illegal and unwarrantable use by the 45 "Defenders of said word or mark or name Cellular' in connection with "the manufacture and sale of cloth and clothing as aforesaid. The use of such "term by itself or in conjunction with any other, by any other trader than "the Pursuers, and, in particular, by the Defenders, deceives the trade and "the public who are induced to deal with the trader using it in the belief they 50 are getting the goods made by or for the Pursuers, and sold by persons "authorised by them to sell such goods. The Pursuers have expended large sums in advertising said Cellular' cloth and clothing, and also devoted "much time and money to designing and effecting improvements on them, "with the result that the designation, name, or mark 'Cellular' has become 55 a valuable property in connection with the sale of said class of goods.” In their statement of facts the Defenders traversed the claim to the word or name "Cellular," and raised the point that whatever rights the Pursuers might have obtained in England, they had no such rights quoad the name in Scotland.

The Cellular Clothing Company v. Maxton and Murray.

They averred:-"The Pursuers' business is an English one, and most of their "trade is done in England and the Colonies. Until recently they had practically no Scotch business, but within the last few years they have endeavoured to "establish a Scotch connection. The Defenders' business, which is one of a "kind similar to the Pursuers', is confined to Scotland. For many years the "Defenders have been in the habit of dealing in various kinds of shirting "woven in different ways. The shirting is, for the purpose of making "distinctions among the cloths, named either from the material or from the "method of weaving, such as All-Wool, Union Flannelette, French Prints, 10" Oxford, Harrow, Matting Oxford, Silk Stripe, &c. Another shirting manu"factured for the Defenders is woven in cells, and the most accurate description "of its weaving is to describe it as cellular-cellular being a common English "word in every day use. In point of fact all cloths are more or less cellular, "but some cloths are woven more openly than others, and the open weaving 15 "thus forms larger cells, and hence the cloth is called in some instances honeycomb, and in others cellular. But this is just a convenient mode of describing open woven cloth. About the middle of January 1897, the Defenders sent "out to their customers pattern books containing samples of their cloth, with a "word descriptive of each kind stamped on the heads of the pages of said 20 "books. On the top of the page containing the pattern of the open or cellular "woven cloth, was printed simply the word 'Cellular,' used to describe said cloth, but there was nothing in the book to represent that said goods were of "the Pursuers' manufacture. The Defenders' customers expect the Defenders' own goods, and they have never represented that they sell any of the Complainers' goods. Nor is it Lefenders' interest to do so, as they and their "customers believe the Defenders' cloth superior to that of the Pursuers. "The issue of these pattern books were withdrawn by the Defenders in the beginning of March. Several months afterwards this action was served 66 upon the Defenders, solely for the purpose of advertisement."

In reply to these latter statements the Pursuers said :-"The name 'Cellular' "is a fancy name in the sense that, while it indicates, it does not actually "describe the structure of the Pursuers' fabric, which is not, and cannot be, "made of cells-cells being closed cavities-and the cavities in the Pursuers' "fabrics being open and crossed as above mentioned. The Pursuers adopted 35 "this name as designative of the fabric made and sold by them, and in the "Scotch, English, and foreign markets it is well known that it designates no "other make than theirs. It is denied that the present action was raised "solely, or at all, for advertising purposes. The Pursuers' right to the name "Cellular' has hitherto been undisputed, and it is very valuable. It is not 40 "known what the Defenders' customers expected, but it is explained that "the Defenders had no right to mark any of their goods with the name "Cellular.'"

The Pursuers accordingly pleaded:-"(1) Cellular' cloth or clothing being "known and understood by the trade and the public to be cloth and clothing 45 "made by the Pursuers, and the Defenders having offered for sale, and sold as "Cellular' cloth and clothing, cloth or clothing which were not made or sold by the Pursuers, the Pursuers are entitled to decree of interdict as craved, "with expenses. (2) The word 'Cellular,' as applied to cloth or clothing and "other similar fabrics having come to be known to and understood by the trade 50" and the public as designating goods manufactured or sold by the Pursuers "alone and no others, the Defenders are not entitled to use that word as "designative of their goods."

The Defenders' pleas were:— (3) The Pursuers not having the exclusive use "of the word 'Cellular,' the Defenders ought to be assoilzied. (4) The Defenders 55" having in describing their said patterns only made use of English words in "common use, they are entitled to absolvitor. (5) The Defenders not having injured the Pursuers' business by unlawful means, they are not entitled to 66 'damages. (6) There being no bond fide reason for the conclusions for

The Cellular Clothing Company v. Marton and Murray.

"interdict, and no loss having been suffered by the Pursuers, the action ought "to be dismissed, with expenses."

The Record was closed on the 27th of October 1897 and sent to the Procedure Roll, where it was called on the 19th of November 1897. On this date the LORD ORDINARY allowed a Proof, and the Proof proceeded on the 21st of 5 January and the 3rd, 4th, and 5th of February 1898. The evidence will be found referred to in detail in the Report of the case in the Courts below (15 R.P.C. 588).

The LORD ORDINARY (after argument) refused interdict with expenses. He held that the issue he had to try was one of fact, and was "have the Pursuers 10 "proved to my satisfaction (1) that in the market in which the Defenders "trade Cellular' cloth means the Pursuers' cloth; (2) that the Defenders "have marked or designated as 'Cellular' cloth sold by them or offered by "them for sale in such manner as to be likely to mislead purchasers, either "purchasers from themselves or shopkeepers with whom they deal"; that it 15 was not proved that either in England or Scotland the public recognised the word "Cellular" as denoting the Pursuers' goods; and that the Pursuers had not established conditions in the Scotch market which made it a misrepresentation to sell in Scotland as "Cellular" cloth any cloth which was not their's.* The Pursuers reclaimed, and the First Division refused the reclaiming note 20 with expenses. They held that, although "Cellular" had come to be generally or extensively known as a trade name applicable to the Pursuers' goods, the Defenders had not under the circumstances used this name so as to represent that the goods they offered for sale were the Pursuers' goods.† The Pursuers appealed to the House of Lords.

The Lord Advocate (Graham Murray, Q.C.), John Cutler, Q.C., and Crabb Watt (instructed by Ernest Salaman, Fort & Co., agents for Clark and Macdonald, of Edinburgh) appeared for the Appellants; Thomas Shaw, Q.C., and T. B. Morison (instructed by Andrews & Sons, agents for P. Morison & Son, of Edinburgh) appeared for the Respondents.

330

The Lord Advocate and John Cutler, Q.C., for the Appellants.-This is a case of trade name, and the question is purely one of fact. There are two issues (1) whether "Cellular" has come to denote the Appellants' goods in the markets; and (2) whether, if this be so, what the Defenders are doing is calculated to deceive. The Lord Ordinary found against the Appellants on the 35 first issue and did not deal with the second. The Inner House, disagreeing with the Lord Ordinary, decided the first issue in favour of the Appellants, but held that what the Respondents were doing was not calculated to deceive. [The evidence was then read.] We submit that the first issue was rightly decided in favour of the Appellants in view of the evidence given by the Appellants' 40 witnesses, who may be analysed as follows: Thirteen witnesses, who may be called independent witnesses as being distinguished from special customers of the Appellants, five of them carrying on business in London, two in Manchester, one in Nottingham, and five in Glasgow; and ten large retail dealers carrying on business in Leeds, Liverpool, Newcastle, Carlisle, Belfast, Dublin, Edinburgh, 45 Glasgow, and Aberdeen, who are called special customers of the Appellants; because, while they are in no sense agents of the Appellants, yet the Appellants confine the supply of their goods for the time being to them in the towns in which they respectively trade. Against this the Respondents had no evidence at all as to England, and as far as Scotland is concerned there is no documentary 50 evidence whatever of the use of "Cellular" in respect of anything else but the Appellants' goods. Although it is alleged that the travellers of wholesale houses have used in Scotland "Cellular " as applied to other goods not a single traveller was called, and, although there is evidence of this use of "Cellular" by the

*See Report 15 R.P.C. 601.

See Report 15 R.P.C. 610.

The Cellular Clothing Company v. Maxton and Murray.

trade themselves in the offices and shops, there is no sufficient evidence of the use of "Cellular" by the public to describe any goods except the Appellants'. This use of "Cellular" by the trade between themselves does not prejudice the Appellants (Millington v. For, 3 M. & C. 338; Ford v. Foster, L.R. 7, Ch. App. 5 616; Singer v. Spence, 10 R.P.C. 297). We rely on Reddaway v. Bentham Hemp Spinning Company, L.R. (1892) 2 Q.B. 639, 9 R.P.C. 503; Reddaway v. Banham L.R. (1896), A.C. 199, 13 R.P.C. 218; Thompson v. Montgomery, L.R. (1891) A.C. 217, 8 R.P.C. 361; and Powell v. The Birmingham Brewery Vinegar Company, L.R. (1897) A.C. 710, 14 R.P.C. 720, all of which were cases of 10 trade name and not of trade mark. We submit that what the Defenders are doing is calculated to deceive. The pattern-book is intended to be shown, and is shown, to the ultimate customers, and there is nothing about the pattern-book to indicate whose the goods are except the letters "M. & M." on the outside cover, and that is not sufficient.

It is not necessary in these cases to prove fraud. [Lord SHAND.-I do not think there is any doubt about that.] The use of a name which is descriptive may be restrained if there is actual fraud, or if its use would have the effect of deceiving (Reddaway v. Banham, ubi supra). [Lord SHAND.-I rather think that in that case of Reddaway it was not put so broadly as that. It was 20 pnt, we find this man's own letter saying, "If you will put 'Camel Hair Belting' "I will take it" they took that rather as a piece of evidence showing that the name had acquired a secondary meaning.] [The LORD CHANCELLOR.I think that observation, which was my own, has been misunderstood. It was not for the purpose of showing that they were guilty of fraud in the sense of 25 intentional fraud, which, to my mind, is not in the least necessary, but for the purpose of showing that a man acquainted with the trade knew that the effect of his putting that name on would be that it would be supposed to be a rival person's.]

Counsel for the Respondents were not called upon.

Lord HALSBURY, L.C.-My Lords, in this case it appears to me that the initial proposition which has been put forward by the learned Counsel is perfectly accurate, namely, that this is a question of fact; and if it is a question of fact it is, to my mind at all events, one that admits of very easy solution.

I agree with almost every word of the judgment of the Lord Ordinary, and, 35 with the exception of the initial proposition, I agree with almost every word in the judgment of the Inner House. I confess I am a little puzzled to know how the initial proposition of the Inner House is reconcileable with what follows. The learned Judges there say they felt a difficulty-and I think they are quite right in saying so-as to "the possible subsistence in trade use of the 40 primary meaning of the word 'Cellular,' as denoting a particular class of goods, alongside of the secondary meaning which the Pursuers seek to affix "to it as denoting goods manufactured or sold by themselves." Then the learned Judges go on with great accuracy, I think, to say, “An invented name "has either no meaning at all, or no meaning in relation to the goods which it "denotes; and it has been held that a trader who selects such a name for the "purpose of distinguishing his goods from those of other traders is entitled to "be protected in the use of the sign which he has chosen. In such a case the mere fact of the use of the arbitrary sign by a rival trader raises a presumption "of a design to pass off his goods under false colours which it is not easy to 50 displace." Every word of that I concur with. Then the learned Judge goes on to say, speaking of the evidence, "I think it must be admitted that the word "Cellular has not lost its descriptive signification according to the use of the "cloth trade; in other words, that the primary meaning has not been displaced "by the secondary meaning, which the Pursuers allege and have in part proved." Further on he says, "In the balanced state of the evidence as to "secondary meaning I think it may be affirmed that there is no presumption "against the Defenders from the mere use of the adjective' Cellular' as a term descriptive of goods which they offer for sale. That being so, we are referred "back to the principle on which this innominate right depends, which is, that

The Cellular Clothing Company v. Marton and Murray.

a trader is not entitled to represent that the goods which he sells are the "goods of a different trader to his injury."

My Lords, I must say for myself I concur in every word of those passages which I have referred to in the judgment of the Inner House, and the only thing that, as I have said, puzzles me is how on that reasoning, and under those 5 circumstances, the Inner House can have pledged itself to the proposition that, but for certain circumstances not very clearly defined, they would have been in favour of the Pursuers on the initial question. That is the whole question, the proposition being, as is rightly pointed out, that no man has a right to sell his goods as though they were the goods of another man. That is the proposition, 10 and the passages I have read seem to me very clearly to dispose of the proposition that, in the particular case here dealt with, one man is selling his goods as the goods of another. But, on the other hand, it has been pointed out with great force and precision that all the circumstances proved are compatible with the view that the word has retained its natural and proper signification. I do 15 not think it is a matter that demands very copious exposition, because, as I have said, it is a question of fact. And I should like to point out here that, as we are dealing with a question of fact and not of principle (that is a proposition which, so far as I have heard, has not been disputed at the Bar), it being a question of fact no previous case can be an authority for any other case, each 20 case must depend upon the facts applicable to that case alone. A principle may be deduced from a previous decision, but there is no dispute about principle in this case, and therefore I am unable to understand what virtue there is in referring to other cases in which the principle has been affirmed.

The only observation that I wish to make upon that part of the argument is 25 that it seemed to be assumed that a fraudulent intention is necessary on the part of the person who was using a name in selling his goods in such a way as to lead people to believe that they were the goods of another person. That seems to me to be inconsistent with a decision given something like sixty years ago by Lord Cottenham, who goes out of his way to say very emphatically, that 30 that is not at all necessary in order to constitute a right to claim protection against the unlawful use of words or things-I say things because it is to be observed that not only words but things, such as the nature of the wrapper, the mode in which the goods are made up, and so on, may go to make up a false representation; but it is not necessary to establish fraudulent intention in order 35 to claim the intervention of the Court. Lord Cottenham says in that case (Millington v. Fox, 3 Mylne & Craig, p. 352) :—"I see no reason to believe that "there has, in this case, been a fraudulent use of the Plaintiff's marks. It is "positively denied by the answer, and there is no evidence to show that the "Defendants were even aware of the existence of the Plaintiffs as a Company 40 "manufacturing steel; for although there is no evidence to show that the terms Crowley' and 'Crowley Millington' were merely technical terms, yet there "is sufficient to show that they were very generally used, in conversation at "least, as descriptive of particular qualities of steel. In short, it does not appear to me that there was any fraudulent intention in the use of the marks. 45 "That circumstance, however, does not deprive the Plaintiffs of their right to "the exclusive use of those names, and therefore I stated that the case is so made out as to entitle Plaintiffs to have the injunction made perpetual.” That, my Lords, I believe to be the law. It was the law then, and it has not been qualified or altered by the fact that the Trade Marks Act has since been 50 passed, which gives a feasible and perfectly facile mode of remedy in cases in which trade marks apply.

I only wish to say, with reference to the case of Reddaway v. Banham (the camel hair belting case), that some words of mine appear to have been made use of in a way they were never intended to be applied. It is true in that 55 particular case there was the intention to deceive, and there was a fraudulent design which, as Lord Cottenham pointed out, was not at all necessary for the purpose of establishing of establishing a right to relief. What I did point out in the case was this: that a man in the trade, whose acquaintance with the trade terms as

« Previous Continue »

Books

Reports of Patent, Design, and Trade Mark Cases, Volume 16