New England Duplicating Co., Inc. v. Mendes
190 F.2d 415, 90 U.S.P.Q. (BNA) 151, 1951 U.S. App. LEXIS 4098 (1951)
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Rule of Law:
Ownership of a trademark is established by priority of appropriation, which requires adoption of the mark and a sufficiently public use to identify the goods as those of the adopter. Under the Lanham Act, a single bona fide transportation of goods bearing the mark in interstate commerce, even without a sale, constitutes sufficient 'use in commerce' to support federal trademark registration.
Facts:
- In 1939, J. Curry Mendes devised a collating machine, named it the 'Paddy' machine, and advertised it in a trade periodical.
- In 1940, Mendes formed Paddy Machine Company, Inc., which by the end of 1942 had sold and shipped two machines bearing the 'Paddy' label in interstate and foreign commerce.
- Soon after March 1942, Mendes withdrew from his corporation, which subsequently ceased operations around 1945.
- Beginning in 1947, Mendes resumed manufacturing the machines under the names 'Mendes' or 'JCM', while intending to reuse the 'Paddy' name on a future product.
- In October 1948, New England Duplicating Co., Inc., began advertising and selling similar machines under the 'Paddy' name.
- On May 31, 1949, for the stated purpose of securing trademark rights, Mendes shipped one of his machines with the 'Paddy' mark from Boston to his own sales office in New York.
- On July 14, 1949, Mendes shipped a second machine with the 'Paddy' mark to a purchaser in New York.
Procedural Posture:
- J. Curry Mendes filed suit against New England Duplicating Co., Inc., in the U.S. District Court, alleging trademark infringement and unfair competition.
- The District Court (a federal trial court) entered a judgment in favor of the plaintiff, Mendes.
- The defendant, New England Duplicating Co., Inc., appealed the trial court's judgment to the U.S. Court of Appeals for the First Circuit.
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Issue:
Does a single, bona fide shipment of goods bearing a trademark across state lines, without an accompanying sale, constitute sufficient 'use in commerce' to establish ownership and support a federal trademark registration under the Lanham Act?
Opinions:
Majority - Woodbury, J.
Yes. A single transportation of goods bearing a trademark in commerce, even without an actual sale, is sufficient 'use' to establish ownership and support registration under the Lanham Act. The statute requires that an applicant be the 'owner' of a mark, and ownership is founded on priority of appropriation. The Act defines 'use in commerce' as when a mark is placed on goods that are 'sold or transported in commerce.' The disjunctive 'or' is critical, meaning transportation alone suffices. To hold that a sale is a sine qua non of use would be an unwarranted limitation on the statute and would disadvantage businesses that lease, rather than sell, their goods. The proper standard for ownership is adoption of the mark followed by use sufficiently public to identify the product's origin. Mendes satisfied this by adopting the 'Paddy' name in 1939, advertising it, and through his former company's two initial sales. Furthermore, his subsequent non-use did not constitute abandonment because he did not have the requisite intent to abandon the mark, creating only a rebuttable presumption of prima facie abandonment.
Analysis:
This decision clarifies the threshold for what constitutes 'use in commerce' under the Lanham Act, establishing that a sale is not a prerequisite for securing federal trademark rights. It affirmed the 'token use' doctrine, whereby a single, bona fide interstate shipment of a product could establish priority of use. While the later adoption of 'intent-to-use' applications has diminished the reliance on token use, this case remains foundational for understanding that trademark rights are grounded in public identification and appropriation, not necessarily in consummated commercial transactions. It lowered the barrier for entrepreneurs to secure rights in a mark before commencing large-scale sales.
