230 WRIGHT RESTAURANT CO. v. WRIGHT.
Statement of Case. 74 Wash.
[No. 11111. Department Two. July 8, 1913.]
WRIGHT RESTAURANT COMPANY et al., Appellants, v.
CHAUNCY WRIGHT et al., Respondents. «1»
APPEAL - DECISION - LAW OF CASE. Where, in a former appeal of
an action to restrain the use of "Chauncy Wright's Cafe" as a
tradename, the supreme court held sufficient on demurrer a
complaint alleging an agreement that such trade-name should be
used by a partnership, and later by a corporation organized by
the partners, but that Mr. Wright might reenter business using
his own name with such precautions as to prevent unnecessary
confusion, and on a subsequent trial on the merits, the evidence
was to the effect that no such agreement was made but that the
partnership and corporation were to be run under the name of
"Wright Restaurant Company," the facts do not support the
allegations of the complaint, and the case is not within the rule
announced in the prior decision.
TRADE-MARKS AND TRADE-NAMES - UNFAIR COMPETITION - AGREEMENTS.
Where a restaurateur having a long established business under the
name of "Chauncy Wright's Cafe," took in a partner and they
formed a corporation and did business under the name "Wright
Restaurant Company," it is not unfair competition that Mr.
Wright, after sale of his interest in the corporation, should
reenter business in the same locality using his full name on the
window, to the injury of the business of the corporation, where
there had been no agreement that he should not reenter business
or that the partnership or corporation should do business under
the name "Chauncy Wright's Cafe," but the corporation had agreed
to do business under its corporate name of "Wright Restaurant
Company."
Appeal from a judgment of the superior court for King
county, Albertson, J., entered October 2, 1912, upon
findings in favor of the defendants, after a trial on the merits
before the court without a jury, in an action for an injunction,
and for damages. Affirmed.
James B. Murphy (Lucas C. Kells, of counsel), for
appellants.
Leopold M. Stern and Donworth & Todd, for respondents.
«1» Reported in 133 Pac. 464.
WRIGHT RESTAURANT CO. v. WRIGHT. 231
July 1913 Opinion Per MAIN, J.
MAIN, J. - The purpose of this action is to obtain a
permanent injunction restraining the use of a trade-name and to
recover damages.
This cause was heretofore before this court upon an
appeal from a judgment dismissing the case after a general
demurrer interposed to the complaint had been sustained and
the plaintiffs had refused to plead further. The court there
held that the complaint stated a cause of action, and the
cause was reversed and remanded with directions to overrule
the demurrer and determine the cause upon the merits.
Wright Restaurant Co. v. Seattle Restaurant Co., 67 Wash. 690,
122 Pac. 348.
For a period of approximately twenty-five years prior to
September 19, 1912, the date of the trial in the superior
court, the defendant Chauncy Wright had been a successful
restaurateur in the city of Seattle, Washington. He and
the places operated by him had become widely known among
certain classes of patrons. About six or seven years prior to
the above mentioned date, he opened a restaurant at No. 164
Washington Street, in Seattle. Thereafter, he became
acquainted with the plaintiff Charles Gearhart, who, upon a
number of occasions subsequent thereto and prior to October,
1909, offered to purchase a half interest in the business.
Wright, however, refused to sell a half interest, but did, in
October, 1909, agree with Gearhart to sell him the entire
interest in the business at 164 Washington Street. Gearhart
paid one-half of the purchase price, took possession, and the
papers were prepared and ready to be signed on the
following day. But when Wright took the lease for the building
to his lessors to be transferred, they refused to accept an
assignment from Wright to Gearhart. Wright not being able
to assign the lease, and Gearhart being unwilling to give up
the deal, they became equal partners in the business. If the
sale had been completed as originally contemplated, it was
arranged that the business should be conducted by Gearhart
at this location under a name other than that of "Chauncy
232 WRIGHT RESTAURANT CO. v. WRIGHT.
Opinion Per MAIN, J. 74 Wash.
Wright's Cafe." During the time the business was operated
by Wright and Gearhart, it was understood and agreed that
the signs bearing the name "Chauncy Wright's Cafe," which
had been used by Wright when he was the sole proprietor,
should be removed. For this purpose a painter was at one
time employed. The work, however, was delayed, and the
signs were not changed or removed, and at the time of the
trial remained practically the same as when Wright
conducted the business alone. The business was conducted as a
partnership for about five months, when, by mutual
agreement, a corporation was formed under the corporate name
of "Wright Restaurant Company" (the plaintiff
corporation), each of the partners taking one-half of the capital
stock.
Thereafter, and in October, 1910, Wright sold and
transferred all of his stock to Gearhart. At the time the
proposal to sell his stock was made, Wright stated: "If you
buy me out you cannot use my name on your restaurant."
After Gearhart became the sole proprietor of the place, he
had painted on the alley side of the building the words
"Wright Restaurant Company." Gearhart also advertised
his place under the name of "Wright Restaurant Company,"
and not as "Chauncy Wright's Cafe." It was clearly
understood by Gearhart when he purchased the stock that Wright
intended soon to again engage in the restaurant business. A
short time after the sale of the stock to Gearhart, Wright
did open two new restaurants, one of which was soon sold,
and the other, located at 110 Occidental avenue, just around
the corner from Gearhart's restaurant and not over 400
feet distant, continued to be conducted by Wright. This
latter business was owned by the Seattle Restaurant
Company, the defendant corporation, Wright being the
president thereof. The name on the window was "Chauncy
Wright," in large letters, and in smaller letters underneath,
"President of Seattle Restaurant Co." Wright advertised
WRIGHT RESTAURANT CO. v. WRIGHT. 233
July 1913 Opinion Per MAIN, J.
this business extensively under practically the same name as
appeared on the window.
The plaintiffs assert that, by reason of the use of this
name in the manner indicated, their business at 164 Washington
Street, which prior to the opening of this restaurant was
a prosperous and paying one, has been injuriously affected,
and that their business has dwindled until at the time this
action was brought they were operating at a loss; that this
loss of business is solely due to the use, in the manner
indicated, of the trade-name "Chauncy Wright." The facts
above stated are substantially as found by the trial court,
and an examination of the record demonstrates that they are
sustained by the evidence. The plaintiffs in their complaint
pray for a permanent injunction prohibiting and restraining
the defendants from the use of the name "Chauncy Wright,"
and for damages. The cause was tried to the court without a
jury, and resulted in a judgment in favor of the defendants.
The plaintiffs appeal.
When the cause was here on the former appeal ( 67 Wash. 690,
122 Pac. 348), the law of the case was settled. It was
there held, based upon the allegations of the complaint, that
Wright had the privilege of entering the restaurant business
when and where he would and to use his name in connection
therewith, but that it was his duty to adopt such affirmative
precautions in the use of his name as to prevent unnecessary
confusion of his with Gearhart's business. According to the
allegations of the complaint as stated in the former opinion,
when Gearhart entered into partnership with Wright, it was
mutually agreed that the trade-name, "Chauncy Wright's
Cafe," should be used by the partnership; and on the
formation of the corporation, it was also agreed that the name
"Chauncy Wright's Cafe" should remain upon the window
and that the business of the corporation should be conducted
under that name. But upon the trial of the cause upon the
merits, on which the present appeal is predicated, the trial
court found that, when the partnership was formed, there was
234 POWERS v. MUNSON.
Syllabus. 74 Wash.
no agreement as to the use of the name "Chauncy Wright"
by them while they were associated in business together; and
it was further found that, at the time of the incorporation of
the Wright Restaurant Company, it was not agreed between
the parties that the name "Chauncy Wright's Cafe" should
remain upon the window, but that it was agreed that the
restaurant should be run under the name of the Wright
Restaurant Company, and not under the name of "Chauncy
Wright's Care." These findings are amply supported by the
evidence. It will be seen, therefore, that the facts as developed
upon the trial do not support the allegations of the
complaint, and, consequently, the case is not within the rule
announced in the prior decision.
The judgment will be affirmed.
ELLIS, MORRIS, and FULLERTON, JJ., concur.