Hostetter Co. v. Martinoni

110 F. 524, 1901 U.S. App. LEXIS 4877
CourtU.S. Circuit Court for the District of Northern California
DecidedJuly 8, 1901
DocketNo. 12,780
StatusPublished
Cited by6 cases

This text of 110 F. 524 (Hostetter Co. v. Martinoni) is published on Counsel Stack Legal Research, covering U.S. Circuit Court for the District of Northern California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hostetter Co. v. Martinoni, 110 F. 524, 1901 U.S. App. LEXIS 4877 (circtndca 1901).

Opinion

MORROW, Circuit Judge.

This is a suit in equity, brought by the complainant, a Pennsylvania corporation, against the defendant, a citizen of California, to enjoin him from manufacturing, selling, or offering for sale, directly or indirectly, any article of stomach bitters as and for, or in the name of, “Hostetter’s Celebrated Stomach-Bitters,” “Hostetter’s Bitters,” “Plostetter,” “Host,” or “H. Bitters,” or from using in any way any of said names in connection with the selling of any article óf stomach bitters not manufactured by complainant. It is alleged that the complainant, on May i, 1889, acquired by purchase the right to make and sell the compound known by the above names, and has the exclusive right to the name “Hos-tetter,” and the abbreviations thereof, as used in connection with the [525]*525compounding and sale of stomach bitters, as a trade-name; that said stomach bitters have been since May i, 1889, and for over 30 years before said date, by complainant’s predecessor, put up and sold in square, amber-colored bottles, holding nearly a quart, with the words “Dr. J. Hostetter’s Stomach Bitters” blown in the glass, and having on two sides of said bottles certain descriptive labels (which have been duly registered as trade-marks in the patent office); that said bottles, when filled with the said preparation and sealed, are packed in boxes containing one dozen each, and in this condition are sold to the trade generally; that the said preparation is never sold in bulk or by the gallon, or in any manner except as just described. It is further alleged that said preparation has become well known to the public, and that the good will of complainant’s business in the manufacture and sale of said stomach bitters is of the value of over $1,000,000. Complainant charges defendant with fraud and unfair dealing in selling at his place of business an imitation article of stomach bitters purporting to be that made by complainant, whereby complainant has been damaged in the sum of $6,000. The fraud and unfair dealing is specifically stated to consist in the following acts: When an intending purchaser calls at defendant’s place of business, and demands to be sold Hostetter’s Stomach Bitters, the defendant sells to him stomach bitters resembling the bitters made by complainant, by the gallon, in demijohns, at $2 per gallon, billing the same as “H. Bitters,” and also refills with defendant’s bulk bitters the bottles of complainant which once contained the genuine Hostetter’s Bitters, and still retain the original labels thereon, selling such refilled bottles at 33 cents per bottle. The defendant enters a denial to these specific charges, and, in turn, alleges that complainant is not entitled to any protection in this court, for the reason that the several names by which said preparation is known to the trade are merely descriptive of a certain kind or quality of bitters, made according to a formula for many years known to pharmacists and chemists, and that coriiplainant has no proprietary interest in, or exclusive right to, said formula, and, further, that complainant is itself guilty of fraud, in knowingly and willfulty placing upon* the market as a medicinal preparation of value said bitters, when in reality the bitters are of no value whatever, save as an intoxicating beverage.

With regard to the first contention of the defendant, whether the names by which complainant’s preparation are known to the trade are merely descriptive or not, the complainant’s rights to the benefits arising from the high reputation of the preparation designated by such names, gained by the efforts of complainant and its predecessors through many years, is undoubted. It is a fundamental principle of the law that one cannot make use of a reputation which another has acquired in a trade name or mark for the purpose of deriving such advantage in the manufacture and sale of the goods as arises from the good will and reputation of the original manufacture. Courts demand a high order of commercial integrity in the use by competitors of a name under which a rival has gained a business reputation, whether that name is strictly a trade-mark or is descriptive of quality merely, and frown upon all filching attempts to obtain the reputation [526]*526of another. Fuller v. Huff, 43 C. C. A. 453, 104 Fed. 141, 51 L. R. A. 332, and cases cited. Did, then, the defendant wrongfully attempt to use the reputation of complainant’s preparation for his own advantage? It appears from the testimony that two of the complainant’s employés went to the defendant’s place of business, and asked for Hostetter’s Bitters. Upon the price being named (70 cents a bottle, by the case), they remarked that it was pretty high. The defendant’s salesman then stated that he could sell them Hostetter’s Bitters in bulk at $2 per gallon, that they made barrels of it, and that it was a fine article. Complainant’s employés offered to purchase a half a gallon at this rate, whereupon the salesman went to the back part of the store and told a man there to fill a half-gallon demijohn with “H. Bitters.” A demijohn was filled with bitters from a keg, and a tag attached to it, reading as follows: “E. Martinoni, importer and dealer in wines, liquors, and cordials, 714-716-718 Front St., San Francisco, California. H. Bitters.” The word “Bitters” was stamped upon the tag with a rubber stamp, apparently, and the letter “H” written in front of the word “Bitters” in pencil. This was written upon the tag by the man who filled the demijohn. This proceeding was repeated a few days later, complainant’s em-ployés then also asking for an empty bottle. The defendant’s salesman inquired whether a Hostetter’s Bitters bottle was desired, and, upon receiving an affirmative reply, brought forward an empty Hostetter’s Bitters bottle, with the original labels thereon and proper revenue stamps. He offered to fill the bottle with the bitters sold in bulk, and upon the agreement of his customers did so, filling it from-the same keg from which they had purchased the half gallon of H. Bitters, and charging them 35 cents therefor. In each instance the salesman had a bill made out for the article purchased; the bitters contained in the demijohn being described as “J4 gal. H. Bitters,” and the filled Hostetter’s bottle as “1 bottle Bitters.” The bitters purchased on these occasions and in the manner stated were not manufactured by complainant. No other deduction can be made from this evidence than that the defendant was attempting to palm off upon its customers‘goods of its own manufacture as and for the goods of the complainant. This is undoubtedly a fraud- upon the complainant’s rights, regardless of the comparative quality of the two preparations.

And with regard to defendant’s second contention, that the complainant’s preparation'is of no value whatever, save as an intoxicating beverage, this statement appears to come at a rather late hour, considering the number of years it has been before the public and the numerous lawsuits in which it has been involved, wherein such a proposition would undoubtedly have arisen and been determined, if meriting attention.' The fact of its being alcoholic to a certain extent cannot be unknown to the public, as the very word “bitters” can only be defined as “a liquor, generally spirituous, in which bitter herbs or roots are steeped.” While the precise formula is claimed as a trade secret by complainant, analyses show the preparation to contain certain solid extracts having medicinal properties. Experts upon any subject are prone to conflicting opinions in this day of evolving [527]*527theories and progressive research, and the medical experts testifying in this case exhibit this general characteristic.

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Cite This Page — Counsel Stack

Bluebook (online)
110 F. 524, 1901 U.S. App. LEXIS 4877, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hostetter-co-v-martinoni-circtndca-1901.