THE COURTS-TO-DAY.

Evening Star, Issue 9462, 6 August 1894, Page 2

THE COURTS-TO-DAY.

SUPREME COURT-CIVIL SITTINGS; (Before His Honor Mr Justice Williams.) BBECHAM V. HANLON. Claim for damages. Mr Haggilt for plaintiffs and Mr Solomon for defendant.

In opening,, Mr Haggitt said that the plaintiffs were Thomas and Joseph Beecham, trading as Thomas Beecham, the makers and proprietors of Beecham's pills, and the defendant was William Hanlon, who formerly carried on business at Fort Chalmars and later at i.Hinedin. Plaintiffs -had Hie right at common law and also by. registration of the use of the words "Beecham's Tills" and other marks employed by the lino. Defendant had for some time past sold pills put up in boxes and with labels which were got up in imitation of plaintiffs' boxes and labels. Plaintiffs claimed firstly an injunction restraining defendant from further infringing plaintiffs' common-law rightand trade marks, and from selling any pills not manufactured by plaintiffs under the name of Beecham's pills; secondly, an account of all profits made by defendant by such sales; and thirdly, £2OO damages. Defendant by his statement said that he had made no profits, and that plaintiffs had sustained no damage.

His Honor : Which are you going for ? damages or an account ? Mr Haggitt: Damages only. Mr Solomon said that he might be able to save learned counsel some trouble. He (Mr Solomon) had only seen the pleadings this morning, and it seemed to him that there was no defence to the action—that it'was merely a question as to the amount of damages.

Mr Haggitt said that he would like to call attention to the case of Peddaway v. Bentham —the camel-hair belting case, heard in the Court of Appeal (L.R., 1892, 2 Q..8. I)i\\, p. 039). Plaintiff thero had not a registered trade mark, but he had rights at common law, which were equivalent to that, and the reason for quoting the case was because it contained a short statement of the law applicable to cases of this kind. L. J. Lopes said : "If a person sells his goods with the intention of deceiving purchasers and of inducing them to believe that his goods are the goods of another, this is actionable, and entitles the latter to recover nominal damages, even though no special damage is proved. If an article has acquired a distinctive meaning in the trade connecting it with a particular person's manufacture, and another so advertises or describes or makes up his goods as to lead purchasers to believe, or to create a probability of their believing, that they are buying the goods of the former, when in fact they are buying the goods of the latter (and this though there is no intention to deceive and no special damage proved), a court of equity will grant relief by way of injunction."

His Honor: On the pleadings, without further evidence, you are entitled to an injunction and nominal damages. Mr Haggitt: And as plaintiffs had elected to go for damages only, and not for accounts, the sole question for the Court was as to the amount of the damages. That depended upon two considerations—firstly, upon the intention of defendant: that was to say, upon the fact that this was not an accidental imitation, but a deliberate attempt to defraud, to make use of the reputation which the manufacturer had obtained, and that it was a deliberate intention was shown by the closeness of the imitation. His Honor: The deliberate intention to imitate is admitted.

Mr Haggitt proceeded to address the Court on the question of damages. •• He showed the judge samples of the genuine and samples of the spurious pills, and, pointing out the similarity in the marks, observed that the English revenue stamp had been imitated, and this was an offence punishable by seven years' imprisonment. Plaintiffs had been driven to go for damages instead of profits, because there was no getting at the sum of defendant's business, he having said that he had kept no account of his profits. Proceedings had been taken in the first place in the Police Court, and, a conviction being recorded, the penalty which he (Mr Haggitt) thought was an inadequate one of £5 and costs on each of the three informations was inflicted. After that a circular was sent out by Beecham's agent, the effect of which was that nearly 400 dozen boxes had been handed in to the New Zealand Drug Company, the holders receiving in exchange onefourth of the quantity of the genuine pills. ' A further effect of the proceedings had been that the sales by outside persons had fallen off almost to nothing, and the only sales that now took place %yere through the authorised agents, the New Zealand Drug Company. In the three weeks that had elapsed the sales of pills by the company had increased by over 200 per cent., whereas in other places the sale had fallen off entirely, it being eyident that persons had become afraid of getting spurious pills. Before Hanlon began this trade the rule was that Beechaiii's pills were sold only at chemists' shops, excepting in the country; but since the Opening of Hanlon's trade every grocer had the pills for sale. They had been distributed far and wide through the districts of \Yellington, Canterbury, and Otago, the inducement tq take the pills from defendant being that he was selling them at lis a dozen, whereas the lowest price at which the genuine article cquld he supplied was 13s Gd. It would be proved by witnesses that Hanlon's pills had been sold in large quantities ; that large quantities had been given up—6oo dozen from three grocers alone, At the price obtained by Hanlon he would receive £330 for the lots returned; and if Beecham had had the sale thp profit would have been £l5O or £l(j0. The greatest loss plaintiffs had sustained, however,, was that an inferior pill—inferior even in appear ance-rhq,d been palmed off on the public as genuine. Beecham's pills were known and recognisd, and the proved residt of taking them was to produce an improvement in persons suffering from certain complaints, whereas when persons took the spurious pills believing them to be genuine, and no good resulted. Beecham's pills must suffer. In view of all these considerations the amount claimed, £2OO, was but a moderate sum. Evidence was given by David G. Shepherd, Francis Meenan, J. Peterson, T. W. Kempibhorne, H. H. G/. Ralfe, George Moir, and gdward Glover. The last-named witness, who was sent Q"t by Beecham tq look into this matter, said in the course of <his eyir dence that he could not say exaptly what the profits were, but they were large in all patent medicine businesses, and, speaUng without a calculation qr the means qf making one, he might guess the profit on these pills at perhaps 5s a dozen. Mr Solomon did not call evidence, but proceeded to address the Court as to the measure qf damages. He could not help admitting nqb qnjy a breach of plaintiffs' .rights, but an intentional and fraudulent breach. After defendant's admission in the Criminal Court it would be absurd to deny jihat. But the established rule in England was $ person whose patent rights were infringed should be paid, in a case where damages were claimed, tlie amount he was shown to have lost. Further, there was no authority to show that damages were given by way of punishment, although, of course, where there was wilful defrauding, as in this case, the courts would not regard the defrauder with lenient eyes. All that could be given to Beecham was the amount of damage actually sustained, and if the estimate of the other side were criticised closely it would be seen that £2OO was $n exaggerated sum. Tlje most the plaintiffs couW say was that if Hantqn h,t(,d nqt sold these pills Beeph&m would have sold sp many more than he had, and made so much more profit. Mr Haggitt had sajd that 608 dozen boxes wppe sold to Shepherd, Meenan, ftnd Peterson, but out of that number 397 do&en had been returned. Tims there wag was only the loss of sale of say 200 dozen boxes altogether. Those pills re. turned were not in the market. If there ever was a sale for them there was yet'a sale. The test of the correctness of jW assumption was to be found in Mr Keinpthßris ! ji eyjijence'. He said that since {.he issue of £V circular ifjvjjbipg returns the sale of the genuine pdls had/ increased by 270 per cent. This increased safe \pas caused by the filling up ef the yajuflm caused h j« the withdrawal. Then, again, fchope was" no suggestion that the reputation offcheteiasSS W been injured. Nobody i i ~* that the usurious} puis had not complained tIU *« VL"» Erv w --\ki. n< . ;«., ft n had the desired ettect. WtffiS; ». £*

amounted to was this: Hanlon had put into the market about 200 dozen boxes of these pills. There were 596 dozen proved to be issued, but of these 397 dozen were returned, leaving eay 200 dozen, and in addition an extra twenty-four dozen to Mr Rutherford, of which eight were returned, or eay 216 dozen altogether. The damages to which Beecham was entitled, taking his own witnesses' evidence, was 5s a dozen on these 216 dozen and 13s 6d per dozen—that was allowing him full price—on the onefourth of the ,'197 dozen (say 100 dozen) returned. It might also ))o pointed out that defendant had already suffered punishment. Mr Haggitt remarked that Mr Solomon had said nothing about the damage enused by inferior pills being vended. Mr Solomon disputed the assumption. There was nothing in the evidence to show that Hanlon'a pills were inferior to Beecham's.

His Honor: Ido not; suppose it really very much matters whether the damages which Mr Haggitt asks for or whether those which Mr Solomon suggests are given. If what one generally hears be true, there is little prospect of getting either. However, as it is possible a matter of law may be involved in the question I think it would be as well that I should take time to consider.