Benj. T. Crump Co. v. J. L. Lindsay, Inc.

107 S.E. 679, 130 Va. 144, 17 A.L.R. 747, 1921 Va. LEXIS 147
CourtSupreme Court of Virginia
DecidedJune 23, 1921
StatusPublished
Cited by23 cases

This text of 107 S.E. 679 (Benj. T. Crump Co. v. J. L. Lindsay, Inc.) is published on Counsel Stack Legal Research, covering Supreme Court of Virginia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Benj. T. Crump Co. v. J. L. Lindsay, Inc., 107 S.E. 679, 130 Va. 144, 17 A.L.R. 747, 1921 Va. LEXIS 147 (Va. 1921).

Opinions

Prentis, J.,

delivered the opinion of the court.

[1] The undisputed facts of this case are, that the appellant, Benjamin T.. Crump Company, Inc., and the appellee^, J. L- Lindsay, Inc., are competitors in the business pf selling: automobile accessories. They are jobbers, who buy their goods from the same manufacturers, and distribute them in the same territory. About July 1, 1919, the Crump Company issued its catalogue, designated as Catalogue No. 3, and about September, 1920, the Lindsay Company issued its catalogue, designated as Catalogue No. 20. The appellant alleges that it discoveri-.rl in the latter part of September. [146]*1461920, that the catalogue of the Lindsay Company included about seventy pages which were photographic copies of pages in the appellant’s catalogue. The bill charges that this constitutes unfair competition, ¡seeks to enjoin the Lindsay Company from issuing or using its catalogue in its business, and to have those copies which have already been issued recalled.

There were both an original and an amended bill, and the defendant having failed to plead, answer or demur, the case was heard upon the bill taken for confessed, and upon certain depositions taken by the complainant. The trial court refused to grant the injunction or the relief prayed for, and dismissed the bill.

It is admitted by the appellant that until the recent decision of International News Service v. Associated Press, 248 U. S. 215, 39 Sup. Ct. 68, 68 L. Ed. 211, 2 A. L. R. 293, the established doctrine was that in order to justify a court of equity in granting an injunction to restrain unfair competition, the acts complained of must be of such a nature as to be likely to deceive the public, or to amount to an attempt to pass off one man’s business or merchandise as that of another, and that this was essential in order to constitute unfair competition. It is, however, claimed, and argued with vigor and ability, that since that decision this doctrine, relied upon by the defendant is no longer binding. It is urged that the law of unfair competition, considered apart from any questions of copyright, patents, trademarks, trade names, and the like, is of very recent development and is now in the process of growth and evolution. That the doctrine is in process of evolution is true, but we do not think the case referred to has overruled or discarded all previous limitations of the rule. .That was a controversy between the International News Service and the Associated Press. The complaint of the Associated Press was that its rival in business took advantage of it by pirating its news [147]*147which had been gathered at great expense, and published it as its own; that it was able to do so by reason of the fact, as expressed by the court, that “most of the foreign news reaches this country at the Atlantic seaboard, principally at the city of New York; and because of this, and of time differentials, due to the earth’s rotation, the distribution of news matter throughout the country is principally from east to west; and, since in speed the telegraph and telephone easily outstrip the rotation of the earth, it is a simple matter for defendant to take complainant’s news from bulletins or early editions of complainant’s members in the eastern cities, and at the mere cost of telegraphic transmission cause it to be published in western papers issued at least as early as those served by complainant. Besides this and irrespective of time differentials, irregularities in telegraphic transmission on different lines, and the normal consumption of time in printing and distributing the newspaper, result in permitting pirated news to be placed in the hands of defendant’s readers sometimes simultaneously with the service of competing Associated Press papers; occasionally, even earlier.” The question there was whether the Associated Press whose .sole business was the furnishing of news to its members, and which had gathered general information and news at great expenditure of money, time and labor, for the purpose of subsequent publication through the press, has such an interest therein as may be protected from interference, and the court said that while it had been raised many times, it had never perhaps, been raised in the precise form in which it was there presented. Treating the case as one of unfair competition, it was held that the news which the Associated Press had acquired at a substantial cost could be sold fairly at a substantial profit, and that its chief competitor in business who was misappropriating it for the purpose of disposing of it for its own profit and to the disadvantage of the com[148]*148plainant could not be heard to say that it is too fugitive or evanescent to be regarded as property. It was held that such news had all the attributes of property necessary for determining that a misappropriation of it by a competitor is unfair competition because contrary to good conscience. The controlling idea of the court is thus expressed: “Stripped of all disguises, the process amounts to an unauthorized interference with the normal operation of complainant’s legitimate business precisely at the point where the profit is to be reaped, in order to divert a material portion of the profit from those who have earned it to those who have not, with special advantage to defendant in the competition because of the fact that it is not burdened with any part of the expense of gathering the news. The transaction speaks for itself, and a court of equity ought not to hesitate long in characterizing it as unfair competition in business.” It must be borne in mind that the subject of that controversy was the right to sell such news, for publication, news itself being the commodity from which both the litigant parties derived their profit. Even there, however, the court was careful to say this: “It is to be observed that the view we adopt does not result in giving to the complainant the right to monopolize either the gathering or the distribution of the news; or, without complying with the Copyright Act [U. S. Comp. St. §§ 9517-9524, 9530-9584], to prevent the reproduction of its news articles; but only postpones participation by complainant’s competitor in the processes of distribution and reproduction of news that it has not gathered, and only to the extent necessary to prevent that competitor from reaping the fruits of complainant’s efforts and expenditure, to the partial exclusion of complainant, and in violation of the principle that underlies the maxim, ‘Sic where huo,’ etc.” The news not being copyrighted, its use by the public after its publication was not restrained, and the injunction re[149]*149strained the competing company from using it only so long as it had special value as news. All other persons, who were not competitors, might freely utilize it from the moment of its first publication. The court distinctly recognized the unbroken line of decisions relating to unfair competition between traders, and sanctioned the general doctrine, characteristic of this class of cases, that there is no unfair competition unless the defendant attempts to palm off its goods as those of the complainant, distinguishing that case from the usual controversies between traders because the news matter was itself the material from which the two competing parties were endeavoring to profit; expressing this idea in this way: “Regarding news matter as the mere material from which these two competing parties are endeavoring to make money, and treating it, therefore, as quasi

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Bluebook (online)
107 S.E. 679, 130 Va. 144, 17 A.L.R. 747, 1921 Va. LEXIS 147, Counsel Stack Legal Research, https://law.counselstack.com/opinion/benj-t-crump-co-v-j-l-lindsay-inc-va-1921.