CHAPTER V
Assignment
It is a fixed principle of the law that a trade-mark cannot be assigned, or transferred, without a transfer of the business with which it is associated.
Trade-marks indicate origin. They are intimately associated with the merchandise for which they are registered. This being a fundamental principle of trade-mark law, it can be understood that a trade-mark cannot pass from hand to hand, and transferred as a separate thing, without losing its real function as a trade-mark.
The Act of 1905 (Section 10) provides that any registered trade-mark may be assigned "in connection with the good-will of the business in which the mark is used."
In the case of MacMahan Pharmacal Co. v Denver Chemical Mfg. Co. (113 Fed. R. 468), the court said:
"A trade-mark cannot be assigned, or its use licensed, except as incidental to a transfer of the business or property in connection with which it has been used. An assignment or license without such a transfer is totally inconsistent with the theory upon which the value of a trade-mark depends and its appropriation by an individual is permitted. The essential value of a trade-mark is that it identifies to the trade the merchandise upon which it appears as of a certain origin, or as the property of a certain person.... Disassociated from merchandise to which it properly appertains, it lacks the essential characteristics which alone gives it value, and becomes a false and deceitful designation."
There is a silk fabric bearing a "Radium" trade-mark, and known in the trade, and among consumers as "Radium Silk." The manufacturers of this fabric, The Gilbert Manufacturing Company, assigned this trade-mark in 1905 to another concern (Eiseman & Company). With the trade-mark they turned over to Eiseman & Company all the manufactured and labeled goods then in their possession. Thereupon the Gilbert Company ceased to use the trade-mark, but did not stop manufacturing the goods, which they put upon the market under the name "Electra". It seems to have been understood by Eiseman & Company, according to the evidence, that the Gilbert Company was to continue making the goods, provided they gave their product some other name than "Radium". As soon as Eiseman & Company obtained the assignment of the trade-mark they, too, began to manufacture the fabric, and sell it under the "Radium" trade-mark.
A trade-mark, or an advertising character, or a catch phrase, may be so thoroughly advertised that it becomes better known than the commodity to which it applies. A little New York girl, age six, who had hardly passed a day of her young life without seeing a ferocious Durham bull glaring from billboards and the fences of vacant lots, gravely said to her mother one day: "Mamma, is all tobacco made from bulls?"
Now the matter comes into court through the suit of Eiseman & Company to prevent a third manufacturer from using the "Radium" trade-mark. They contended that the assignment of the mark to them by its original owner, The Gilbert Mfg. Co., gave them the exclusive right to its use.