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There appeared before the committee Maj. Gen. George W. Davis U.S. Army, retired, chairman of the central committee of the American National Red Cross; Miss Mabel T. Boardman, a member of the central committee of the American National Red Cross; and William C. Henderson, esq., of Washington, D. C., representing Johnson & Johnson, a corporation, of New Jersey.
STATEMENT OF WILLIAM C. HENDERSON, ESQ., OF 501 F STREET,
NW., WASHINGTON, D. C.
The CHAIRMAN. Whom do you represent?
Mr. HENDERSON. I represent Mr. Archibald Cox, of New York City, who is counsel for Johnson & Johnson, of New Jersey, manufacturers of a large line of pharmaceutical preparations. Mr. Cox expected to be present in person today to present the case to the committee, but I received a telephone message from him yesterday and a letter this morning in which he states that because of another engagement he finds it impossible to leave New York to be here today, and so he has asked me to represent him, and he has sent me a paper containing a concise statement of his views on this subject. Perhaps it would be well for me to read his letter. I am not so familiar with the subject as he is, because he has studied it, while I have just been called into the case.
The CHAIRMAN. Very well; read the letter and let it be inserted in the record. Mr. HENDERSON. This letter is as follows:
NEW YORK, April 11, 1910. William G. HENDERSON, Esq.
DEAR SIR: By reason of engagements which I cannot break, it will not be practicable for me to be in Washington on the 12th instant, and I accordingly beg to request that you will appear for me at the hearing of the House Committee on Foreign Affairs on the bill relating to the Red Cross (H. R. 22311) and present the following on behalf of Messrs. Johnson & Johnson:
Johnson & Johnson, a New Jersey corporation, having its principal office at New Brunswick, N. J., has for about twenty-five years been engaged in the manufacture of surgical and pharmaceutical goods of many kinds. Its business is the largest of its kind in the country, and probably in the world. During that period it has continuously used as a trade-mark in connection with its goods the symbol of a red cross and its goods bave been referred to, asked for, and identified by that symbol and the equivalent words, “red cross. For example, purchasers throughout the United States desiring, say, a mustard plaster, or a package of cotton, embodying the particular excellence for which the house is well known, look for the red cross and ask for a “Red Cross mustard plaster,” or a “package of Red Cross cotton.” In creating the demand for the goods thus identified Johnson & Johnson have expended many hundreds of thousands of dollars and twenty-five years of the most conscientious industry. It is not going too far to say that the goodwill thus created is embodied chiefly in the Red Cross trade-mark and that to take that mark from them would be an injury more serious than the destruction of their plants.
The rights of Johnson & Johnson in the Red Cross trade-mark have been examined and protected in several courts (e. g., Johnson & Johnson v. Bauer & Black, 82 Fed., 662, 27 C. C. A., 374; Johnson & Johnson v. Brunor, 107 Fed., 466; Johnson & Johnson v. Rutan, 122 Fed., 993; Johnson & Johnson v. Seabury & Johnson, 61 Atl. Rep., 5, 67 Atl. Rep., 26).
The bill to amend the act incorporating the American National Red Cross in its present form might be construed so as to confiscate the trade-mark and goodwill of Johnson & Johnson. That bill makes any use of the red cross a crime, but provides that owners of trade-marks heretofore registered "shall not be deemed forbidden by this act to use such trade-mark in accordance with the terms thereof." This proviso is apparently intended to prevent the bill being unconstitutional, as
representing confiscation of valuable vested property rights without compensation. The proviso does not accomplish this purpose, because it overlooks the fact that property rights in trade-marks in this country depend solely upon use and not at all upon registration, which is merely a convenient form of prima facie evidence of rights arising from use under the common law. (Trade-Mark Cases, 100 U. S., 82.) As against a person who has acquired a property right by use (without registration), the bill would seem to be unconstitutional.
So far as Johnson & Johnson are concerned, their interests would be sufficiently protected by an amendment adding, at the end of line 22, on page 2, following the word “thereof,” the words "for the class of goods mentioned therein,” so that the clause will read: "Shall not be deemed forbidden by this act to use such trademarks in accordance with the terms thereof for the class of goods mentioned therein."
Johnson & Johnson have a half dozen or more registrations of the mark in the United States Patent Office, and any amendment which makes it plain that the bill permits the use on the class of goods,” as distinguished from the “particular description,” would save them from practical injury. This is, however, a matter of importance to them, as may be indicated by an illustration: They make, for example, the many varieties of medicinal plasters set forth in the pharmacopoeia. The registration may mention medicinal plasters as "the class of goods” and indicate only, say, opium plaster as the “particular description of goods.” It is of great importance that the class of goods should be recognized in a business which comprises the manufacture of hundreds of different articles.
Another amendment has been suggested by a manufacturer who has used the mark for 30 years or more in another industry and has no registration, having relied on his common-law property right. It also would prevent the bill being confiscatory and perhaps meet the views of those who advocate it. This amend ment is as follows: Cancel the proviso—that is, all of lines 14 to 22, inclusiveand substitute in lieu thereof the following:
"Provided, however, That this act shall not be construed to interfere with or forbid the use of any trade-mark, word or words, or symbol, by any person, firm, or corporation which, or whose assignors, has used such trade-mark, word or words, or symbol, in his trade or business since before January fifth, nineteen hundred and five, and which shall on or before six months after the passage of this act file with the secretary of the American National Red Cross affidavit of such use."
In brief, any amendment which will alter the bill so that it cannot destroy their goodwill and property would be satisfactory to Johnson & Johnson. They respectfully protest against the passage of the bill in its present form as unnecessary, unjust, and unconstitutional. Yours very truly,
ARCHIBALD Cox. Now, I think that letter, may it please the committee, sets forth briefly and clearly the views of Mr.Cox, counsel for the Johnson & Johnson Company. The bill, as stated by him, does make it unlawful after its passage to use the symbol of the red cross or the words "red cross" upon any goods, with this proviso:
That owners of trade-marks heretofore registered in the United States Patent Office in pursuance of the trade-mark laws of the United States; and owners of trade-marks for the registration of which applications were filed prior to January fifth, nineteen hundred and five, in the United States Patent Office, and for which registration, upon such applications has been or shall hereafter be made in pursuance of the laws of the United States, shall not be deemed forbidden by this act to use such trade-marks in accordance with the terms thereof.
You will observe that the bill as framed exempts from its provisions the owners of trade-marks who have, prior to January 5, 1905, obtained registration for those trade-marks in the Patent Office, and further exempts from the provisions
Mr. DENBY. Pardon me; it says "for which registration upon such applications has been or shall hereafter be made.
Mr. HENDERSON. The first provision is for those who have obtained registration prior to January 5, 1905, and then follows this and for which registration upon such applications have been or shall hereafter be made in pursuance of the laws of the United States.
That is, applications filed prior to January 5, 1905.
Mr. HENDERSON. In other words, in order to be exempt from the provisions of this bill the owner of a trade-mark who has used the mark for twenty-five or thirty years in his business must have either obtained registration prior to January 5, 1905, or must have filed an application for registration prior to that date, which application is still pending in the Patent Office; and if registration has been or shall be issued upon that application filed prior to January 5, 1905, then the owner of that registered trade-mark is exempted from the provisions of this bill.
Mr. DENBY. Your contention is that any person ought to be exempted who had a legal right to use the trade-mark at any time prior to this amendment?
Mr. HENDERSON. This amendment, or prior to the prior act?
Mr. DENBY. The prior act? The prior act provides that any person may use it who had the legal right prior to that time.
Mr. HENDERSON. Yes.
Mr. DENBY. So that if you say any person who had the right prior to this act, it would not open the door to anybody prior to 1905, because they were barred by the old act?
Mr. HENDERSON. They were barred by the old act; and if this was framed so as to allow those who had the lawful use of the trade-mark prior to the passage of the former act to use it now, this bill would be constitutional and would not divest anyone of vested rights. The present bill seems to proceed upon the theory that the right to a trade-mark and property in a trade-mark is acquired only by registration in the Patent Office. The fact, and the law, is that a trademark right must be acquired by actual use before a party can go into the Patent Office and obtain registration. It is a common-law right.
Mr. DENBY. Your contention, briefly, would be that nobody can be barred by this act who had the right to use the trade-mark prior to January 5, 1905?
Mr. HENDERSON. According to the terms of this act, those parties are exempted from its operation.
Mr. DENBY. Had the terms been different, it would not be constitutional?
Mr. HENDERSON. It would not be constitutional; consequently, the purposes of the act would simply fail, and I take it that the promoters of this, who are engaged in a most commendable philanthropic object, want to get something that will benefit them when they get it.
Mr. DENBY. Will you explain how the promoters would have any way of checking the use of the red cross in the finding out who was entitled to use the red cross symbol prior to January 5, 1905, except by some record? What is there, otherwise, to prevent them from coming in and seeking registration, and what check, in the absence of some record, would there be upon their proof of their right to registration?
Mr. HENDERSON. In the application they have to make oath setting forth the time since which they have used the mark continuously in business.
Mr. DENBY. Yes; but your provision is based upon the idea that they do not have to apply?
Mr. HENDERSON. They do not have to apply.
Mr. GARNER. He seeks to amend that by the amendment requiring them to file an affidavit with the Red Cross that they have used that prior to 1905.
Mr. DENBY. Yes; I am familiar with that amendment.
Miss BOARDMAN. In the past we have found that since the act of 1905 there have been a number of trade-marks issued allowing the use of the red cross, because anybody can go to the Patent Office and ask that their trade-mark be registered, making affidavit of the use of the red cross prior to 1905, and no proof would be required. We would know nothing of this, and it would be issued on their affidavit that it had been used prior to 1905. No proofs were required. When we inquired why those trade-marks had been issued, the Patent Office replied it had received affidavits from the parties that the use had been prior to 1905.
Mr. HENDERSON. I think Miss Boardman is correct about that, because in making application for a registration of a mark, say a red cross, or in fact other marks, the applicant for the registration is required under the rules and practice of the Patent Office to accompany that application with a sworn declaration setting forth the date when the mark was first used, and since which date this mark has been continuously used for which registration is sought.
Mr. DENBY. Then, it would all come around, in your idea, to this point, that we cannot enjoin them from using these trade-marks—that is, you can pass legislation of this kind, but so long as the door to evasion is so wide open, the legislation becomes inoperative, practically, if we pass as broad an amendment as is desired?
Mr. HENDERSON. As it is framed, we have no doubt whatever that it is unconstitutional, because it absolutely seeks to, and so far as legislation can, it does, take away from the owners of trade-marks a vested property right. For instance, you take the case of Johnson & Johnson, who have used this symbol for twenty-five year and more in their business.
Mr. DENBY. Yes.
Mr. DENBY. Pardon me. I would like to ask Miss Boardman whether I am correct in my views that the theory of the Red Cross is that they do not wish to disturb any vested rights.
Miss BOARDMAN. We do not want to disturb those rights, and we. suggested that such trade-marks be called to their attention and the class of goods be specified. We were perfectly willing to have that added. But we find that the law protects all sorts of emblems of fraternal orders, and that trade-marks are not allowed which use the coats of arms of States. Our own national flag cannot be used, and state flags cannot be used. There is an absolutely prohibitory provision in the patent law against such use. We feel that the Red Cross should have the same protection that the fraternal orders have. It is in a way a fraternal order. We think the international use of
the emblem should give it the same protection that fraternal orders, state coats of arms, and the national flag have received from the Patent Office.
Mr. DENBY. And we want to give that protection so far as it can possibly be done. Now, all I want to know it whether the Red Cross recognizes that desire not to attempt to interfere with vested rights in the use of the symbol?
Miss BOARDMAN. Yes.
Mr. DENBY. Which vested rights had accrued before the Red Cross came into existence. Is that it? Am I to understand that you do not wish to interfere with any vested rights which accrued prior to January 5, 1905.
Miss BOARDMAN. We do not want to interfere with such rights, and we could not interfere with them, but at the same time we want to have a provision in the law so that people cannot continue to use the red cross, particularly as it is used now. For instance, it is used on automobiles, it is used on the productions of pharmacists, and it is used for any number of advertising purposes. We have Red Cross pharmacies, Red Cross bakeries, Red Cross chicken food, Red Cross cow remedies, Red Cross shoes, and all sorts of things. It has become a common symbol, and this has injured the use for which it was selected by treaty. There was a man shot in San Francisco at the time of the disaster because he flew a Red Cross flag on his automobile when he had no right to do it. There was nothing to prevent his doing it. This man was crossing the dead line, and in order to get across the line he was flying this flag, which he had no authority to fly. He was shot by one of the National Guard and killed. This created a great deal of excitement at the time because an emblem was fired on which was recognized in warfare as a protection. Anybody who wanted to cross the line at that time made a little red cross, put it on his arm, and was allowed to cross. This created a great deal of confusion. Of course in time of war it is essential for its purpose of protection, and if it is misused it loses all its significance.
I have here a reprint from an article by Mr. Renault, who is an authority on international law, and he speaks of the abuse of the signal leading up to the absolute neutralization of its powers. He says that if soldiers see it used on all sorts and kinds of articles and also on all sorts and kinds of places, it conveys no idea of protection as intended. When it is put upon beer shops, and wines have been labeled with it, then how can it protect hospital supplies? So far as Johnson & Johnson and their trade-mark are concerned, their supplies are of a kind that we feel is least objectionable in the use of the emblem, because they are in the nature of hospital supplies; but when the emblem is used on all kinds of things, it loses its power to protect. We even have Red Cross false teeth, as I noticed in one advertisement.
Mr. DENBY. There are three separate suggestions here before the committee. One is contained in the bill, one is the amendment suggested to be incorporated in this bill, and the other is Johnson & Johnson's amendment, which merely adds to this amendment those few words, to cover the substances for which the mark has been used by them.
Now, I want to see if we have got it right in the bill. The amendment in the bill states that those persons who are the owners of trade-marks heretofore registered shall be exempt. "Heretofore