Early Trademark Law I
Bill Long 11/14/05
The "Canal Company" Case, 80 US 311 (1871)
I was involved on one fairly complex trademark-related case when I was a litigation attorney in Portland. I remember reading bundles of cases and trying to understand a complex statute in order to determine how someone's skit might infringe a copyright held by our clients. As I waded through all kinds of difficult but fascinating cases, about Zorro's mask or likenesses of "Norm" from Cheers, I began wondering whether all the fuss about Trademark law boiled down just to one or two simple propositions, about confusion and intent to deceive. I thought that what I would do here is to investigate some early cases on trademark law in the United States, before the complexities of the modern world and modern statutes entered in, to see if I could discern and pick out the basic principles of trademark law working in their naked simplicity. I am enough of a Germanist in my historical method to believe that if you understand the origin and development of a phenomenon, you must might have enough information easily to wade through the alleged modern complexities of the phenomenon.
Delaware and Hudson Canal Company, 1871
So I thought it would be good to look at some classic US Supreme Court cases on trademarks (written 'trade-marks' in those days) to see what I could learn. In addition to learning principles about the development of this branch of law, I also picked up lots of interesting history about the growth of the United States.
From early times (i.e., before European incursion), the area in NE PA was known as "Lorckaworna" or "Lackawanna." When Europeans began to settle the region at the end of the 18th century, it was "uncultivated and little known to people generally in any way." The discovery of coal after 1820 brought an end to the idyllic remoteness of Lackawanna. Almost overnight the Northcentral and Northeastern parts of PA became known for the valleys and rivers which sliced the area, and Eastern businesses rushed to the areas to exploit the new-found riches. In 1825 the Delaware and Hudson Canal Company ("Company") purchased coal lands in the area, constructed a 108 mile-long canal from the Hudson River to a place not far from the coal, and then constructed a railroad to the mines in order to bring the coal to market. The extraction and transport of coal began shortly thereafter; in 1828 the Company produced 720 tons; in 1829 it was 43,000 tons; in 1866, the last year the Company had figures, 1,300,000 tons. They called the coal extracted "Lackawanna Coal" and peddled it through their agents throughout the Eastern states.
Times and Americans being what they were, other companies rushed in to get a piece of the wealth. A second company in 1852, and a third in 1856, also began to mine coal in the area, bringing it to market either through the Company rails and canals or other means. Though mined in the same general area, the second company (PA Coal Company) called their coal "Pittston Coal" while the third company (DE, Lackawanna, and Western Railroad Co) denominated their lode "Scranton Coal." All eventually agreed that the coal of each was indistinguishable from the other's, even though plaintiffs at first tried to make the argument that their coal was "better prepared" than the others. Because of the long experience and reputation of the Company, however, it was able to sell its Lackawanna Coal for more than the others could sell their respective varieties.
Sensing this reality, an enterprising businessman from Providence, RI, a certain Mr. Clark, decided to buy up a supply of the Scranton and Pittston Coal and market it in the Providence area as "Lackawanna Coal." This enabled him, of course, to turn a bigger profit for himself even though, as he figured, he wasn't misleading his customers since the Pittston and Scranton Coal, being identical to that sold as Lackawanna Coal, was, in fact, Lackawanna Coal. He sold none of the Company's coal. The Company, as would be expected, filed a bill in equity against Clark, to enjoin his calling the coal which he sold "Lackawanna coal." So, the basic question of the case was whether Clark could legally do what he did. More precisely, the case considered whether the name "Lackawanna Coal" was a "special, particular, and distinctive name or trade-mark, by which their coal might be introduced to dealers." That is, could the Company have exclusive rights to the use of the term?
This presents a very nice and clear set of facts to explore the contours of trademark law. We know that a trademark is some kind of mark affixed to or associated with a product in order to indicate the origin of a product, but this case explores the acceptable range of names that might be selected for such a product. The real issue in trademark law, however, is the exclusivity of the mark. What must one do, or what kind of name/mark may one use in order to assure an exclusive use of the term? Can one trademark a process? a quality? a region? a proper name? a phrase descriptive of the item? a descriptive "logo" containing the item? The next essay will lay out the case made by plaintiffs, the Company, in arguing that they possessed the exclusive right to denominate their coal "Lackawanna Coal."
Copyright © 2004-2008 William R.Long