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Goldscheider v. Schnitzer

Decided: June 1, 1949.

WALTER F. GOLDSCHEIDER, ERWIN F. GOLDSCHEIDER AND GOLDSCHEIDER, INC., PLAINTIFFS,
v.
LOUIS SCHNITZER, NATHAN GELFMAN, JACK B. ORENSTEIN, AND GOLDCREST CERAMICS CORPORATION, DEFENDANTS



Civil Action. On Final Hearing.

Jayne, J.s.c.

Jayne

It was many years ago in the City of Vienna, Austria, that the Goldscheider family began to engage in the design and manufacture of ornamental and decorative figurines. Their statuettes and character figures through the channels of importation entered the markets of this country where within the field of that craft the name "Goldscheider" became relatively popular and preferential.

Figures of charming ladies with delicate skin tones and richly colored bonnets and gowns supplemented by attractive miniature models of children and animals soon achieved an increasing vendibility in the United States. The industry has become competitive.

The story of the present case, however, is one of relatively recent events. On September 1, 1942, the plaintiffs Walter F. Goldscheider and his son, Erwin F. Goldscheider, were evidently in need of additional capital, and they united with the three individual defendants in the organization of the Goldscheider-Everlast Corporation, which pursued the business of manufacturing and vending ceramic figurines at Trenton, New Jersey.

Irreconcilable discord intruded among them and on October 3, 1947, the two plaintiffs agreed to sell their interests as stockholders of the company to the three defendants. A written agreement of that date embodies the terms and provisions of the transaction. The following covenant of the agreement engages superior recognition in the consideration of this litigation:

Paragraph 8(b)(i) of Agreement provides as follows:

"The Purchasers shall on or before July 1, 1948 (i) cause Goldscheider-Everlast Corporation and its stockholders and directors to take such steps and do such things, execute, acknowledge and file in the office of the Department of State of New Jersey such documents as may be necessary to change the corporate title of Goldscheider-Everlast Corporation by eliminating therefrom the name Goldscheider or any name similar thereto."

On December 19, 1947, the three defendants organized the Goldcrest Ceramic Corporation to resume the business of the former Goldscheider-Everlast Corporation. On February 16, 1948, the two plaintiffs caused to be incorporated their own company under the title "Goldscheider, Inc." It is acknowledged that the two companies are competitors in the molding and sale of ceramic figurines.

The alleged grievance of the plaintiffs is that the adoption of "Goldcrest" as a part of the corporate name of the defendants' enterprise is a violation of the covenant of the agreement in that it is similar to the trade and corporate name "Goldscheider." The plaintiffs seek appropriate injunctive relief. However, the broad cardinal object of the complaint is to enjoin alleged unfair competition. Our former Court of Chancery has declared that unless there is, as here, actual competition, there cannot be unfair competition. National Grocery Co. v. National Stores , 95 N.J. Eq. 588, 123 A. 740; affirmed, 97 N.J. Eq. 360, 127 A. 925; Baltimore v. Clark , 131 N.J. Eq. 290, 25 A.2d 30; affirmed, 132 N.J. Eq. 374, 28 A.2d 169. Nevertheless I venture to say that I think that the modern invocation of equity ought to depend more predominantly upon the character of the unfairness than upon the degree of competition. Cf. Edison v. Edison Polyform and Mfg. Co. , 73 N.J. Eq. 136, 67 A. 392; Blue Goose Auto, etc., v. Blue Goose Super, etc. , 110 N.J. Eq. 438, 160 A. 836; reversed, 110 N.J. Eq. 547, 160 A. 316; 51 West Fifty-first Corp. v. Roland , 139 N.J. Eq. 156, 50 A.2d 369. Vide, Annotation , 148 A.L.R. 12.

Competition in free and open markets, however intense, is desirable only when the competition is honest and scrupulous so that the dealer may strive to achieve success upon his own reputation and the quality of his own productions.

It has become a common practice for a manufacturer to adopt some trade-mark, label, sign or symbol to distinguish his or its own products from those of the same general type or class made by others. In numerous instances it is of supreme significance that principally by means of ...


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