do differ, they have no application to the case | diversion of trade was effected through phyat bar. sical or moral coercion, or by inducing breaches of contract or of trust or by enticing away employés. In some others, called cases of simulated competition, relief was granted because defendant's purpose was unlawful; namely, not competition but deliberate and wanton destruction of plaintiff's business.13 Fourth. Plaintiff further contended that defendant's practice constitutes unfair competition, because there is "appropriation without cost to itself of values created by" the plaintiff; and it is upon this ground that the decision of this court appears to be based. To appropriate and use for profit, knowledge and ideas produced by other men, without making compensation or even acknowledgment, may be inconsistent with a finer sense of propriety; but, with the exceptions indicated above, the law has heretofore sanctioned the practice. Thus it was held that one may ordinarily make and sell anything in any form, may copy with exactness that which another has produced, or may otherwise use his ideas without his consent and without the payment of compensation, and yet not inflict a legal injury;11 and that ordinarily one is at perfect liberty to find out, if he can by lawful means, trade secrets of another, however valuable, and then use the knowledge so acquired gainfully, although it cost the original owner much in effort and in money to collect or produce.12 Such taking and gainful use of a product of another which, for reasons of public policy, the law has refused to endow with the attributes of property, does not become unlawful because the product happens to have been taken from a rival and is used in competition with him. The unfairness in competition which hitherto has been recognized by the law as a basis for relief, lay in the manner or means of conducting the business; and the manner or means held legally unfair, involves either fraud or force or the doing of acts otherwise prohibited by law. In the "passing off" cases (the typical and most common case of unfair competition), the wrong consists in fraudulently representing by word or act that defendant's goods are those of plaintiff. See Hanover Milling Co. v. Metcalf, 240 U. S. 403, 412, 413, 36 Sup. Ct. 357, 60 L. Ed. 713. In the other cases, the "Flagg Manufacturing Co. v. Holway, 178 Mass. 83, 59 N. E. 667: Bristol v. Equitable Life Assurance Society, 132 N. Y. 264, 30 N. E. 506, 28 Am. St. Rep. 568; Keystone Type Foundry v. Portland Publishing Co., 186 Fed. 690, 108 C. C. A. 508. 12 Chadwick v. Covell, 151 Mass. 190, 23 N. E. 1068, 6 L. R. A. 839, 21 Am. St. Rep. 442; Tabor v. Hoffman, 118 N. Y. 30, 36, 23 N. E. 12, 16 Am. St. Rep. 740; James v. James, L. R. 13 Eq. 421. Even when knowledge is compiled, as in a dictionary, and copyrighted, the suggestions and sources therein may be freely used by a later compiler. The copy. right protection merely prevents his taking the ultimate data while avoiding the labor and expense involved in compiling them. Pike v. Nicholas, L. R. 5 Ch. App. 251; Morris v. Wright, L. R. 5 Ch. App. 279; Edward Thompson Co. v. American Law Book Co., 122 Fed. 922, 59 C. C. A. 148, 62 L. R. A. 607; West Pub. Co. v. Edward Thompson Co., 176 Fed. 833, 100 C. C. A. 303. It is assumed that in the absence of copyright, the data compiled could be freely used. See Morris v. Ashbee, L. R. 7 Eq. 34, 40. Compare also Chilton v. Progress Printing & Publishing Co., [1895] 2 Ch. 29. *That competition is not unfair in a îegal sense, merely because the profits gained are unearned, even if made at the expense of a rival, is shown by many cases besides those referred to above. He who follows the pioneer into a new market, or who engages in the manufacture of an article newly introduced by another, seeks profits due largely to the labor and expense of the first adventurer; but the law sanctions, indeed encourages, the pursuit.14 He who makes a city known through his product, must submit to sharing the resultant trade with others who, perhaps for that reason, locate there later. Canal Co. v. Clark, 13 Wall. 311, 20 L. Ed. 581; Elgin National Watch Co. v. Illinois Watch Co., 179 U. S. 665, 673, 21 Sup. Ct. 270, 45 L. Ed. 365. He who has made his name a guaranty of quality, protests in vain when another with the same name engages, perhaps for that reason, in the same lines of business; provided, precaution is taken to prevent the public from being deceived into the belief that what he is selling, was made by his competitor. One bearing a name made famous by another is permitted to enjoy the unearned benefit which necessarily flows from such use, even though the use proves harmful to him who gave the name value. Brown Chemical Co. v. Meyer, 139 U. S. 540, 544, 11 Sup. Ct. 625, 35 L. Ed. 247; Howe 13 "Trust Laws & Unfair Competition" (U. S. Bureau of Corporations, March 15, 1915) pp. 301331, 332-461; Nims, Unfair Competition and TradeMarks, c. XIX; Sperry & Hutchinson Co. v. PomCo. v. Dittgen, 171 Fed. 631, 96 C. C. A. 433; Schonmer (D. C. 199 Fed. 309, 314; Racine Paper Goods wald v. Ragains, 32 Okl. 223, 122 Pac. 203, 39 L. R. A. (N. S.) 854; Attorney General v. National Cash Register Co., 182 Mich. 99, 148 N. W. 420, Ann. Cas. 1916D, 638; Witkop & Holmes Co. v. Great Atlantic & Pacific Tea Co., 69 Misc. Rep. 90, 124 N. Y. Supp. 956, 958; Dunshee V. Standard Oil Co., 152 Iowa, 618, 132 N. W. 371, 36 L. R. A. (N. S.) 2C3; Tuttle v. Buck, 107 Minn. 145, 119 N. W. 946, 22 L R. A. (N. S.) 599, 131 Am. St. Rep. 446, 16 Ann. Cas. 807. The cases of Fonotipia Limited v. Bradley (C. C.) 171 Fed. 951, and Prest-O-Lite Co. v. Davis (D. C.) plaintiff, contain expressions indicating rights pos209 Fed. 917, which were strongly relied upon by the sibly broad enough to sustain the injunction in the case at bar; but both cases involve elements of "passing off." See also Prest-O-Lite Co. v. Davis, 215 Fed. 349, 131 C. C. A. 491; Searchlight Gas Co. v. Prest-O-Lite Co., 215 Fed. 692, 131 C. C. A. 626; Prest-O-Lite Co. v. H. W. Bogen (C. C.) 209 Fed. 915; Prest-O-Lite Co. v. Avery Lighting Co. (C. C.) 161 Fed. 648. In Prest-O-Lite Co. v. Auto Acetylene Light Co. (C. C.) 191 Fed. 90, the bill was dismiss ed on the ground that no deception was shown. *259 14 Magee Furnace Co. v. Le Barron, 127 Mass. 115; Ricker v. Railway, 90 Me. 395, 403, 38 Atl. 338. ble. Scale Co. v. Wyckoff, Seamans & Benedict, I mitting news which it believes to be credi198 U. S. 118, 25 Sup. Ct. 609, 49 L. Ed. 972; Donnell v. Herring-Hall-Marvin Safe Co., 208 U. S. 267, 28 Sup. Ct. 288, 52 L. Ed. 481; Waterman Co. v. Modern Pen Co., 235 U. S. 88, 35 Sup. Ct. 91, 59 L. Ed. 142. See Saxlehner v. Wagner, 216 U. S. 375, 30 Sup. Ct. 298, 54 L. Ed. 525. The means by which the International News Service obtains news gathered by the Associated Press is also clearly unobjectionable. It is taken from papers bought in the open market or from bulletins publicly posted. *No breach of contract such as the court considered to exist in Hitchman Coal & Coke Co. v. Mitchell, 245 U. S. 229, 254, 38 Sup. Ct. 65, 62 L. Ed. 260, L. R. A. 1918C, 497, Ann. Cas. 1918B, 461; or of trust such as was present in Morison v. Moat, 9 Hare, 241; and neither fraud nor force is involved. The manner of use is likewise unobjectionable. No reference is made by word or by act to the Associated Press, either in transmitting the news to subscribers or by them in publishing it in their papers. Neither the International News Service nor its subscribers is gaining or seeking to gain in its business a benefit from the reputation of the Associated Press. They are merely using its product without making compensation. See Bamforth v. Douglass Post Card & Machine Co. (C. C.) 158 Fed. 355; Tribune Co. of Chicago v. Associated Press (C. C.) 116 Fed. 126. That they have a legal right to do, because the product is not property, and they do not stand in any relation to the Associated Press, either of contract or of trust, which otherwise precludes such use. The argument is not advanced by characterizing such taking and use a misappropriation. Nor is the use made by the International News Service of the information taken from papers or bulletins of Associated Press members legally objectionable by reason of the The purpose for which it was employed. acts here complained of were not done for the purpose of injuring the business of the Associated Press. Their purpose was not even to divert its trade, or to put it at a disadvantage by lessening defendant's necesThe purpose was merely to sary expenses. supply subscribers of the International News Service promptly with all available news. The suit is, as this court declares, in substance one brought for the benefit of the members of the Associated Press, who would be proper, and except for their number perhaps necessary, parties; and the plaintiff conducts the suit as representing their interests. It thus appears that the protection given by the injunction is not actually to the business of the complainant news agency; for this agency does not sell news nor seek to earn profits, but is a mere instrumentality by which 800 or more newspapers collect and distribute news. It is these papers sev erally which are protected; and the protection afforded is not from competition of the defendant, but from possible competition of one or more of the 400 other papers which receive the defendant's service. Furthermore, the protection to these Associated Press members consists merely in denying to other papers the right to use as news, information which by authority of all concerned, had theretofore been given to the public by some of those who joined in gathering it; and to which the law denies the attributes of property. There is in defendIt is also suggested that the fact that de-ant's purpose nothing on which to base a fendant does not refer to the Associated Press as the source of the news may furnish a basis for the relief. But the defendant and its subscribers, unlike members of the Associated Press, were under no contractual obligation to disclose the source of the news; and there is no rule of law requiring knowledgment to be made where uncopyrighted matter is reproduced. The International News Service is said to mislead its subscribers into believing that the news transmitted was originally gathered by it and that they in turn mislead their readers. There is, in fact, no representation by either of any kind. Sources of information are sometimes given because required by contract; sometimes because naming the source gives authority to an otherwise incredible statement; and sometimes the source is named because the agency does not wish to take the responsibility itself of giving currency to the news. But no representation can properly be implied from omission to mention the source of information except that the International News Service is trans *260 #261 *202 claim for relief. *It is further said that, while that for which the Associated Press spends its money is too fugitive to be recognized as property in the common-law courts, the defendant cannot be heard to say so in a court of eqacuity, where the question is one of unfair competition. The case presents no elements of equitable title or of breach of trust. The only possible reason for resort to a court of equity in a case like this is that the remedy which the law gives is inadequate. If the plaintiff has no legal cause of action, the suit necessarily fails. Levy v. Walker, L. R. 10 Ch. D. 436, 449. There is nothing in the situation of the parties which can estop the defendant from saying so. Fifth. The great development of agencies now furnishing country-wide distribution of news, the vastness of our territory, and improvements in the means of transmitting intelligence, have made it possible for a news agency or newspapers to obtain, without paying compensation, the fruit of another's efforts and to use news so obtained gainfully in competition with the original | porarily by arrangement with the Associated collector. The injustice of such action is Press the latter's foreign news service. For obvious. But to give relief against it would aught that appears, all of the 400 subscribinvolve more than the application of exist- ers of the International News Service would ing rules of law to new facts. It would re- gladly have then become members of the quire the making of a new rule in analogy Associated Press, if they could have secured to existing ones. The unwritten law posses- election thereto.15 It is possible, also, that ses capacity for growth; and has often satis- a large part of the readers of these papers fied new demands for justice by invoking were so situated that they could not secure analogies or by expanding a rule or prin- prompt access to papers served by the Asciple. This process has been in the main sociated Press. The prohibition of the forwisely applied and should not be discontin- eign governments might as well have been ued. Where the problem is relatively sim- extended to the channels through which news ple, as it is apt to be when private interests was supplied to the more than a thousand only are involved, it generally proves ade- other daily papers in the United States not quate. But with the increasing complexity served by the Associated Press; and a large of society, the public interest tends to be part of their readers may also be so located come omnipresent; and the problems present- that they cannot procure prompt access to ed by new demands for justice cease to be papers served by the Associated Press. simple. Then the creation or recognition A Legislature, urged to enact a law by by courts of a new private right may work which one news agency or newspaper may serious injury to the general public, unless prevent appropriation of the fruits of its lathe boundaries of the right are definitely bors by another, would consider such facts established and wisely guarded. In order and possibilities and others which ar proprito reconcile the new private right with the ate inquiry might disclose. Legislators might public interest, it may be necessary to pre- conclude that it was impossible to put an scribe limitations and rules for its enjoy-end to the obvious injustice involved in such ment; and also to provide administrative appropriation of news, without opening the machinery for enforcing the rules. It is door to other evils, greater than that sought largely for this reason that, in the effort to be remedied. Such appears to have been to meet the many new demands for justice the opinion of our Senate which reported unincident to a rapidly changing civilization, favorably a bill to give news a few hours' resort to legislation has latterly been had protection;16 and which ratified, on Februwith increasing frequency. The rule for which the plaintiff contends would effect an important extension of property rights and a corresponding curtailment of the free use of knowledge and of ideas; and the facts of this case admonish us of the danger involved in recognizing such a property right in news, without imposing upon news-gatherers corresponding obligations. A large majority of the newspapers and perhaps half the newspaper readers of the United States are dependent for their news of general interest upon agencies other than the Associated Press. The channel through which about 400 of these papers received, as the plaintiff alleges, "a large amount of news relating to the European war of the greatest importance and of intense interest to the newspaper reading public" was suddenly closed. The closing to the International News Service of these channels for foreign news (if they were closed) was due not to unwillingness on its part to pay the cost of collecting the news, but to the prohibitions imposed by foreign governments upon its securing news from their respective countries and from using cable or telegraph lines running therefrom. For "Sec. 2. That for any infringement of the copyright granted by the first section of this act the aught that appears, this prohibition may party injured may sue in any court of competent have been wholly undeserved; and at all jurisdiction and recover in any proper action the events the 400 papers and their readers may damages sustained by him from the person making be assumed to have been innocent. such infringement, together with the costs of suit." For It was reported on April 18, 1884, by the Comaught that appears, the International News mittee on the Library without amendment, and Service may have sought then to secure tem- that it ought not to pass. Journal of the Senate, 39 SUP.CT.-6 "That any daily or weekly newspaper, or any association of daily or weekly newspapers, published in the United States or any of the territories thereof, shall have the sole right to print, issue, and sell, for the term of eight hours, dating from daily or weekly newspaper, or the collected news the hour of going to press, the contents of said of said newspaper association, exceeding one hundred words. 15 According to the by-laws of the Associated Press no one can be elected a member without the affirmative vote of at least four-fifths of all the members of the corporation or the vote of the directors. Furthermore, the power of the directors to admit anyone to membership may be limited by a right of protest to be conferred upon individual members. See By-Laws, article III, section 6. "The members of this corporation may, by an affirmative vote of seven-eighths of all the members, confer upon a member (with such limitations as may be at the time prescribed) a right of protest against the admission of new members by the board of directors. The right of protest, within the limits specified at the time it is conferred, shall empower the member holding it to demand a vote of the members of the corporation on all applications for for which it is conferred except as provided in section 2 of this article." the admission of new members within the district 16 Senate Bill No. 1728, 48th Congress, First Session. The bill provides: *265 ary 15, 1911, the convention adopted at the might, with a view to making the remedy Fourth International American Confer- more certain and adequate, provide a fixed ence;17 and such was evidently the view also measure of damages, as in the case of copyof the signatories to the International Copyright infringement.22 right Union of November 13, 1908,18 as both these conventions expressly exclude news from copyright protection. *Or legislators dealing with the subject might conclude, that the right to news values should be protected to the extent of permitting recovery of damages for any unauthorized use, but that protection by injunction should be denied, just as courts of equity ordinarily refuse (perhaps in the interest of free speech) to restrain actionable libels,19 and for other reasons decline to protect by injunction mere political rights;20 and as Congress has prohibited courts from enjoining the illegal assessment or collection of federal taxes.21 If a Legislature concluded to recognize property in published news to the extent of permitting recovery at law, it 48th Congress, First Session, p. 548. No further action was apparently taken on the bill. When the copyright legislation of 1909, finally enacted as Act of March 4, 1909, c. 320 (35 Stat. 1075), was under consideration, there was apparently no attempt to include news among the subjects of copyright. Arguments before the Committees on Patents of the Senate and House of Representatives on Senate Bill No. 6330 and H. R. Bill No. 19853, 59th Congress, First Session, June 6, 7, 8, and 9, and December 7, 8, 10, and 11, 1906; Hearings on Pending Bills to Amend and Consolidate Acts Respecting Copyright, March 26, 27 and 28, 1903. 17 38 Stat. 1785, 1789, Article 11. Or again, a Legislature might conclude that it was unwise to recognize even so limited a property right in published news as that above indicated; but that a news agency should, on some conditions, be given full protec*tion of its business; and to that end a remedy by injunction as well as one for damages should be granted, where news collected by it is gainfully used without permission. If a Legislature concluded (as at least one court has held, New York and Chicago Grain and Stock Exchange v. Board of Trade, 127 Ill. 153, 19 N. E. 855, 2 L. R. A. 411, 11 Am. St. Rep. 107) that under certain circumstances news-gathering is a business affected with a public interest; it might declare that, in such cases, news should be protected against appropriation, only if the gatherer assumed the obligation of supplying it at reasonable rates and without discrimination, to all papers which applied therefor. If legislators reached that conclusion, they would probably go further, and prescribe the conditions under which and the extent to which the protection should be afforded; and they might also provide the administrative machinery necessary for insuring to the public, the press, and the news agencies, full enjoyment of the rights so conferred. Courts are ill-equipped to make the inves 18 Bowker, Copyright: Its History and Its Law,tigations which should precede a determinapp. 330, 612, 613. See the similar provisions in the Berne Convention (1886) and the Paris Convention (1896). Id. pp. 612, 613. In 1898 Lord Herschell introduced in Parliament a bill, section 11 of which provides: "Copyright in respect of a newspaper shall apply only to such parts of the newspaper as are compositions of an original literary character, to original illustrations therein, and to such news and information as have been specially and independently obtained." (Italics ours.) House of Lords, Sessional Papers, 1898, Vol. 3, Bill No. 21. Birrell, Copyright in Books, p. 210. But the bill was not enacted, and in the English law as it now stands there is no provision giving even a limited copyright in news as such. Act of December 16, 1911, 1 and 2 Geo. 5, c. 46. 19 Boston Diatite Co. v. Florence Mfg. Co., 111 Mass. 69, 19 Am. Rep. 310; Prudential Assurance Co. v. Knott, L. R. 10 Ch. App. 142. 20 Giles v. Harris, 189 U. S. 475, 23 Sup. Ct. 639, 47 L. Ed. 909. Compare Swafford v. Templeton, 185 U. S. 487, 22 Sup. Ct. 783, 46 L. Ed. 1005; Green v. Mills, 69 Fed. 852, 859, 16 C. C. A. 516, 30 L. R. A. 90. 21 Revised Statutes, § 3224 (Comp. St. 1916, § 5947); Snyder v. Marks, 109 U. S. 189, 3 Sup. Ct. 157, 27 L. Ed. 901; Dodge v. Osborn, 240 U. S. 118, 36 Sup. Ct. 275, 60 L. Ed. 557. tion of the limitations which should be set upon any property right in news or of the circumstances under which news gathered by a private agency should be deemed affected with a public interest. Courts would be powerless to prescribe the detailed regulations essential to full enjoyment of the rights conferred or to introduce the machinery required for enforcement of such regulations. siderations such as these should lead us to decline to establish a new rule of law in the effort to redress a newly disclosed wrong, although the propriety of some remedy appears to be clear. Con Act of March 4, 1909, § 25, c. 320 (35 Stat. 1075, 1081) provides, as to the liability for the infringement of a copyright, that "in the case of a newspaper reproduction of a copyrighted photograph such damages shall not exceed the sum of two hundred dollars nor be less than the sum of fifty dollars," and that in the case of infringement of a copyrighted newspaper the damages recoverable shall be one dollar for every infringing copy, but shall not be less than $250 nor more than $5,000. *267 (248 U. S. 182) DILLON v. STRATHEARN S. S. CO. THE STRATHEARN. The Circuit Court of Appeals certifies two questions to this court: First. Is section 4530 of the Revised Statutes of the United States, as the same was (Argued and Submitted Nov. 5, 1918. Decided amended by section 4 of the act of Congress, Dec. 23, 1918.) No. 361. 1. COURTS 384-CERTIFIED QUESTIONS CERTIFICATE-STATEMENT OF FACTS. Under Judicial Code, § 239 (Comp. St. 1916, § 1216), providing for certification of questions of law from Circuit Court of Appeals, and that Supreme Court may give instruction on the questions certified, or order whole record sent up for consideration and decision, and Supreme Court Rule 37, providing that the certificate shall contain a proper statement of the facts on which the certified questions arise, the certificate by itself, and without reference to transcript, must state the pertinent facts necessary for answering the questions. approved March 4, 1915, entitled "An act to promote the welfare of American seamen in the merchant marine of the United States; to abolish arrest and imprisonment as a penalty for desertion and to secure the abrogation of treaty provisions in relation thereto; and to promote safety at sea"-violative of the Constitution of the United States? Second. Is section 4530 of the Revised Statutes of the United States, as the same was amended by the last-mentioned act of Congress approved March 4, 1915, violative of the Constitution of the United States in so far as it provides: "That this section shall apply to seamen on foreign vessels while in harbors of the United CERTIFIED-States, and the courts of the United States shall be open to such seamen for its enforcement." The certificate, on certification of questions under Judicial Code, § 239 (Comp. St. 1916, § 1216), not sufficiently stating the pertinent facts, will be dismissed. On a Certificate from the United States Circuit Court of Appeals for the Fifth Circuit. Suit in admiralty by John Dillon against the steamship Strathearn; the Strathearn Steamship Company, claimant. On appeal from the District Court, the Circuit Court of Appeals certified questions. Certificate dismissed. Messrs. William J. Waguespack, of New Orleans, La., and Silas Blake Axtell, of New York City, for Dillon. 239 of the Judicial Code (Act March 3, 1911, [1] The certificate is made under section c. 231, 36 Stat. 1157 [Comp. St. 1916, § 1216]), which makes provision for the certification of questions of law to this court from a Circuit Court of Appeals. The section provides that this court may give instruction on the questions certified, or it may order the whole record sent up for consideration and decision. Rule 37 of this court (32 Sup. Ct. xiv) provides that in such cases the certificate shall contain a proper statement of the facts on which the questions of law arise. The certificate in this case fails to comply with this rule of court. It contains a partial statement of Dillon's contract with the ship. It states that no part of the sum sued for was Mr. Assistant Attorney General Brown, due under the shipping articles signed by for the United States. Dillon. It does not state the terms of pay Mr. Ralph James M. Bullowa, of New York ment agreed upon, when or where payments City, for Strathearn S. S. Co. were to be made under the contract, or what advancements, if any, were to be made during Mr. Justice DAY delivered the opinion of the voyage. The certificate concludes: the court. John Dillon, a British subject, filed a libel in admiralty in the United States District Court for the Northern District of Florida in which he claimed the sum of $125 alleged to be due him for wages as a carpenter on the steamship Strathearn. The District Court dismissed the libel (239 Fed. 583). An appeal was taken to the Circuit Court of Appeals for the Fifth Circuit. The libel was filed under the provisions, of section 4 of the Seaman's Act March 4, 1915, c. 153, 38 Stat. 1165, 1168 (Comp. St. 1916, § 8322).1 1 "Sec. 4. That section forty-five hundred and thirty of the Revised Statutes of the United States be, and is hereby, amended to read as follows: "Sec. 4530. Every seaman on a vessel of the United States shall be entitled to receive on demand from the master of the vessel to which he belongs "For information as to the facts of the case copies of the transcripts and briefs are herewith transmitted." one-half part of the wages which he shall have the voyage has been commenced, shall load or delivthen earned at every port where such vessel, after er cargo before the voyage is ended and all stipulations in the contract to the contrary shall be void: Provided, such a demand shall not be made before the expiration of, nor oftener than once in five days. Any failure on the part of the master to comply with this demand shall release the seaman from his contract and he shall be entitled to full payment of wages earned. And when the voyage is ended every such seaman shall be entitled to the remainder of the wages which shall then be due him, as provided in section forty-five hundred and twenty-nine of the Revised Statutes: • • And provided further, that this section shall apply to seamen on foreign vessels while in harbors of the United States, and the courts of the United States shall be open to such seamen for its enforcement.' For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes |