Garrett v. T. H. Garrett & Co.

No. 458
Decided Circuit Court of Appeals, Sixth Circuit
Disposition
affirmed in part
full scope
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Court
Circuit Court of the United States for the District of Kentucky
Decided
Judge
SAGE, District Judge
Posture
Motion for preliminary injunction heard on bills, exhibits, and affidavits
Complainants/Plaintiffss (4)
George B. Wilson, Henry D. Moore, and John O. Gilmore, partners doing business under the firm name of W. E. Garrett & Sons
Tipien W. Muir
v.
Defendants (2)
T. H. Garrett & Co., a corporation
Augustus E. Wilson, Shackelford Miller

Overview

The order of the judge below for an injunction as to the use of the labels is affirmed, and the order refusing an injunction against the use of the name of 'T.H. Garrett,' or 'T.H. Garrett & Co.,' is reversed, with costs. The cause is remanded, with instructions to continue the injunction granted, and to grant an injunction against the use of the name of the defendant 'T.H. Garrett,' or of the name 'Garrett,' as a part of the corporate name of the defendant, or in its business.

Case summary

This is a trademark and unfair competition case involving manufacturers of snuff. The appellants, doing business as W.E. Garrett & Sons, had for many years manufactured and sold 'Garrett's Snuff' with established labels and trade. The appellee corporation, T.H. Garrett & Co., used imitative labels and the name 'Garrett' on inferior quality snuff sold at reduced prices to retailers, who then sold it to consumers as the genuine 'Garrett's Snuff.' The trial court granted a preliminary injunction regarding the labels but refused to enjoin use of the name 'Garrett.' On appeal, the Circuit Court of Appeals held that the complainants had protectable rights in the name 'Garrett' as a descriptive term based on long use and established trade, and that the defendant's use was fraudulent with intent to appropriate the complainants' good will. The court reversed the refusal to enjoin use of the name, finding it a case where preliminary relief was necessary to prevent irreparable injury.

Abstract

Manufacturers of snuff with long-established labels and trade name "Garrett" sought to enjoin a competitor from using imitative labels and the name "Garrett" on inferior products sold to deceive consumers into believing they were genuine. The trial court issued a preliminary injunction on labels but not the name, which the appellate court reversed, holding the name protectable due to secondary meaning from long use and finding the competitor's use fraudulent to appropriate goodwill. The case was remanded to extend the injunction against use of the defendant's name or "Garrett" in its business to prevent irreparable injury.

Opinion of the court

Majority
opinion
SAGE, District Judgejoined by TAFT, LUJJTON
  • Defendant's use of imitative labels and name was fraudulent
  • Complainants had protectable rights in 'Garrett' name based on long use
  • Preliminary injunction necessary to prevent irreparable injury to good will
  • Right to use one's own name does not extend to fraudulent appropriation of another's trade

Jurisdiction

not challenged
Subject matter
Equity suit in federal circuit court
Jurisdictional facts
  • Suit brought in United States circuit court for the district of Kentucky

Procedural posture

Posture at trial
Motion for preliminary injunction heard on bills, exhibits, and affidavits
Posture on appeal
Direct appeal from partial grant/denial of preliminary injunction
Preserved issues
  • Whether complainants entitled to exclusive use of 'Garrett' name
  • Whether injunction should issue against use of name

Legal categories

Business

Case record

Full case name
GARRETT et al. v. T. H. GARRETT & CO.
Docket number
No. 458
Court
Circuit Court of Appeals, Sixth Circuit
Trial court
Circuit Court of the United States for the District of Kentucky
Decided
Opinion author
SAGE, District Judge
Opinion type
published
Precedential status
precedential
Judges on panel
TAFTLUJJTONSAGE

Issues & holdings

2
Issues raised
2
reversed
3
Holdings
Standard of review

abuse of discretion

Disposition rationale

Complainants entitled to use of 'Garrett' as descriptive term based on long use and established trade

Preservation

Issue preserved for review

Standard of review

abuse of discretion

Disposition rationale

Defendant's use was fraudulent and would cause irreparable injury if not enjoined

Preservation

Issue preserved for review

Holdings of the court

Use of imitative labels with inferior article
The use by a manufacturer of imitative labels and devices, in connection with an inferior article, which is sold to retailers at a reduced price, with the purpose and result of enabling them to sell it to consumers as the goods of another, will be enjoined.
Such use constitutes fraud and trespass on complainant's good will
unanimousbinding precedent
Right to use descriptive name
Where a firm has for many years used the name of its predecessors in connection with its goods, and has built up an extensive trade thereunder, such name, even if it could not be used as a trade-mark, is to be treated as a descriptive term, to the benefit of which they are entitled.
Long-established use creates protectable rights in descriptive terms
unanimousbinding precedent
Use of corporate name to appropriate trade
Where a corporation organized to manufacture and sell snuff had assumed the name of an employe holding a few shares of its stock, with the evident purpose of appropriating the trade of others of the same name, who had long used the name in connection with their snuff, such corporation would be enjoined from using the name as part of its corporate name, or in its business.
Corporate name used fraudulently to appropriate another's good will is enjoinable
unanimousbinding precedent

Error analysis

  • Trial court refused to enjoin use of 'Garrett' name in preliminary injunction — procedural · error foundNot harmless as refusal would allow continued fraud and irreparable injury · not harmless

Standards of review

  • Granting or withholding preliminary injunction — abuse of discretion Granting preliminary injunction is largely within discretion of trial judge, but appellate court may reverse if discretion improvidently exercised

Timeline

5
Events
654
Days, incident to ruling
—
Span
factual eventcited in opinion

Defendant T.H. Garrett & Co. incorporated with capital stock of $2,000

Establishment of defendant corporation

T.H. Garrett · Incorporators
factual eventcited in opinion

Articles of incorporation amended increasing capital stock to $35,000

Reorganization with T.H. Garrett as minor shareholder

T.H. Garrett · J.B. Holloway · Henry Laub · E.K. Burley · Hannah Laub
factual eventcited in opinion

Defendant issued circular hoping no one would confuse their snuff with complainants'

Shows awareness of potential confusion

T.H. Garrett & Co.
procedural eventcited in opinion

Complainants filed suit and motion for preliminary injunction

Outcome: Partial injunction granted

Trial court enjoined labels but not name use

Complainants · Defendant · Trial court trial court
appeal eventcited in opinion

Circuit Court of Appeals decision reversing in part and remanding

Outcome: Reversed refusal to enjoin name use, affirmed label injunction

Final appellate decision

Circuit Court of Appeals judges appellate court

Facts & evidence

Key facts

7 facts
  1. Appellants manufacture snuff known as 'Garrett's Snuff'
  2. Appellee corporation used labels and name 'Garrett' on snuff cans and packages
  3. Defendant's labels were close imitations of complainants' labels and designs
  4. Defendant sold inferior quality snuff at reduced prices to retailers
  5. Retailers sold defendant's snuff as 'Garrett's Snuff' to consumers as if it were complainants' product
  6. Defendant reorganized in 1895 with T.H. Garrett as minor shareholder
  7. Defendant changed labels before suit but retained 'Garrett' name

Procedural history

4 steps
  1. Complainants filed suit to restrain defendant from using labels and name 'Garrett'
  2. Motion for preliminary injunction heard on bills, exhibits, and affidavits
  3. Trial court granted injunction regarding labels but refused injunction regarding name
  4. Complainants appealed the refusal to enjoin use of name

Evidence in the record

Direct
  • Exhibits of cans, packages and labels used by defendant
  • Affidavits from both parties
Physical
  • Cans and packages of snuff
  • Labels and wrappers
Testimonial
  • Affidavits of T.H. Garrett
  • Affidavits of officers of defendant corporation
  • Affidavits for complainants
Documentary
  • Articles of incorporation
  • Circular issued by defendant
  • Advertising matter
Circumstantial
  • Similarity of labels and designs
  • Retention of 'Garrett' name despite inferior product
  • Corporate structure showing T.H. Garrett as minor shareholder

Objects of relevance

Snuff cans and packagesLabels and wrappersWhite paper for labels

Authorities

Cited authorities (7)

Duplex Printing-Press Co. v. Campbell Printing Press & Manuf'g Co., 16 C. C. A. 220, 69 Fed. 252
followedprecedent
Rule on not disturbing trial court discretion unless improvidently exercised
California Fig Syrup Co. v. Frederick Stearns & Co., 20 C. C. A. 22, 73 Fed. 812
followedprecedent
Descriptive terms entitled to protection
Salt Co. v. Burnap, 20 C. C. A. 27, 73 Fed. 818
followedprecedent
Descriptive terms entitled to protection
Holloway v. Holloway, 13 Beav. 209
appliedpersuasive
Cannot use own name to deceive public
William Rogers Manuf'g Co. v. Rogers & Spurr Manuf'g Co., 11 Fed. 495
appliedquotedpersuasive
Restraint on use of own name if appropriating another's good will
at Quoted principle
Rogers Co. v. Wm. Rogers Manuf'g Co., 17 C. C. A. 576, 70 Fed. 1017
appliedpersuasive
Same ruling on corporate name use
Landreth v. Landreth, 22 Fed. 41
appliedquotedpersuasive
Prior user protected against fraudulent use of same name
at Quoted holding

Related cases (7)

Duplex Printing-Press Co. v. Campbell Printing Press & Manuf'g Co., 16 C. C. A. 220, 69 Fed. 252
prior appeal
Cited for rule on disturbing trial court discretion
California Fig Syrup Co. v. Frederick Stearns & Co., 20 C. C. A. 22, 73 Fed. 812
prior appeal
Cited for protection of descriptive terms
Salt Co. v. Burnap, 20 C. C. A. 27, 73 Fed. 818
prior appeal
Cited for protection of descriptive terms
Holloway v. Holloway, 13 Beav. 209
persuasive authority
Held that one cannot use own name to deceive public
William Rogers Manuf'g Co. v. Rogers & Spurr Manuf'g Co., 11 Fed. 495
persuasive authority
Held that use of own name may be restrained if appropriating another's good will
Rogers Co. v. Wm. Rogers Manuf'g Co., 17 C. C. A. 576, 70 Fed. 1017
persuasive authority
Same ruling on corporate name use
Landreth v. Landreth, 22 Fed. 41
persuasive authority
Held that prior user protected against fraudulent use of same name

Standards & doctrines

  • Abuse of discretion standard for injunctions
  • Protection of descriptive terms
  • Fraud exception to right to use own name

Legal principles applied

  • Long use establishes protectable rights in descriptive terms
  • Preliminary injunction appropriate to prevent irreparable injury
  • Right to use own name does not extend to fraudulent appropriation
Index terms91
Summary terms
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Legal remedies
Legal evidence
Legal arguments
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Legal procedural steps
Geo locations
Judges
Attorneys
Procedural terms
Substantive offenses
Entities and documentation
Legal actions
Action type
affirmed in part
Target
trial court injunction regarding labels
Appealed from
Circuit Court of the United States for the District of Kentucky
Context
Affirmed order for injunction as to use of labels
Scope
full
Action type
reversed in part
Target
trial court refusal to enjoin use of name
Appealed from
Circuit Court of the United States for the District of Kentucky
Context
Reversed order refusing injunction against use of name 'T.H. Garrett' or 'Garrett'
Scope
full
Action type
remanded
Target
case to trial court
Appealed from
Circuit Court of Appeals
Context
Remanded with instructions to continue label injunction and grant injunction against name use
Scope
full
Further instructions
Continue injunction granted, and grant injunction against use of name 'T.H. Garrett' or 'Garrett' as part of corporate name or in business
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