File No. 893.54/324.
Chargé MacMurray to
the Secretary of State.
[Extract.]
No. 748.]
American Legation,
Peking,
September 7, 1915.
Sir: In continuation of despatch No. 695 of
July 20 last, with which the Legation forwarded for the information of
the Department certain correspondence in regard to the infringement of
the Vaseline trade-mark, I now have the honor to enclose copies of
further correspondence on this subject.
I regret that, by reason of the necessity of despatching the pouch in
time to catch the S. S. Manchuria, I must forward
this correspondence without awaiting the fuller report on the case which
is being sent by Consul Gauss. I must therefore confine myself at this
time to such comment as is necessary to explain the recent developments
of the case, reserving for the future such conclusions and
recommendations as I anticipate it will be necessary to bring to the
attention of the Department.
In the phase of the case which was reported in my No. 695 of July 20, the
efforts of Mr. Gauss were primarily directed towards disabusing the
minds of the special commissioner for foreign affairs, and the
magistrate of the Mixed Court of an impression which they seemed to have
derived during the period before Mr. Gauss assumed charge of the
Consulate General in early July, that the matter was one on which the
American Government had no decided views and to which it attached no
importance. The efforts of the Legation were similarly directed towards
impressing upon the Foreign Office a realization of the fundamental
importance and significance of the case, alike from the viewpoint of
American trade-mark rights under the treaties and from that of the
Chinese Government as involving a new encroachment upon its sovereignty.
As indicated in my previous despatch, the Minister of Foreign Affairs
received these representations with apparently complete and sympathetic
appreciation of the issues involved, and repeatedly gave satisfactory
assurances in reply to my various requests that the Shanghai authorities
be instructed
[Page 247]
in the sense of
the views which he apparently shared with the Legation. In making these
requests, I endeavored to make it plain that the Legation assumed no
right to influence the decision of the Mixed Court on the merits of the
case, but desired and insisted solely that no other outside influence
should be permitted to cause the court to renounce its obligation to
give justice to the American complainants as against persons under its
jurisdiction violating Chinese law as established in accordance with our
treaty rights. These representations were apparently so successful that
on August 11 Dr. Hawkling L. Yen, his secretary, took occasion to inform
me that on the previous day the Minister for Foreign Affairs had
telegraphed through the special commissioner for foreign affairs at
Shanghai the specific and categorical instruction that the Mixed Court
should exercise full jurisdiction in the case. It was therefore not
surprising, though very gratifying, to receive from the Consulate
General at Shanghai the telegram of August 19 reporting that the Mixed
Court had given judgment in favor of the American owners of the
trade-mark, sustaining the principle of priority as against the Japanese
contention that the rights of the American owners in China had been
annulled by the action of Japanese manufacturers in registering the mark
as their own in Tokyo.
It was, on the other hand, a matter of the keenest disappointment and
chagrin to receive the telegram of August 23 in which the Consulate
General reported that, after the departure of the American assessor on
leave, it had been discovered that the Chinese version of the judgment
was radically different, and even contradictory to the English judgment
as reported to the Consulate General by the assessor. I took prompt
occasion to see the Minister for Foreign Affairs and sought to impress
upon him the incompatibility of this Chinese judgment with the
instructions which he had sent to Shanghai,
The report from Consul Gauss, under date of August 25, was received on
the 28th ultimo. I at once brought the substance of this report to the
attention of Dr. Yen, orally, and asked for an appointment to discuss it
with the Minister. In the meanwhile, I addressed to the Foreign Office a
note under date of the 30th ultimo, upholding the position taken by the
Consulate General; namely, that the English text of the judgment, as
discussed between the American assessor and the magistrate, and agreed
upon between them, and read and recorded by the assessor, should be
considered and executed as the authoritative text.
It proved impossible to arrange an appointment with Mr. Lou until the
31st ultimo; he outlined to me a “full report” that he had received from
Magistrate Kuan, which made no mention at all of the English judgment,
but reported that the judgment as drafted and read and entered by him in
Chinese was fully concurred in by the American and Japanese assessors. I
reminded Mr. Lou that the Japanese assessor was not sitting in the case
and had no locus standi in reference to it; and in regard to the
concurrence of our assessor, I pointed out that the magistrate’s
statement on that point was flatly negatived by the directly
contradictory judgment which Mr. Bishop had read and entered on the
English charge sheet. The Minister then talked of the unfortunateness of
the misunderstanding that had arisen, and said that it would require a
great deal of investigation
[Page 248]
to
clear up; and he said he would ask the magistrate to report concerning
the English judgment to which he had omitted to make reference in his
despatch, and offered to communicate with me further when that
supplementary report should have been received. I remarked that the
immediate question was whether or not Americans could obtain from a
Chinese court the enforcement of their rights under the treaties. Mr.
Lou asked what could be done; and I repeated the suggestion contained in
my note of the previous day, that the English judgment should be
regarded as authoritative, and so executed, the magistrate meanwhile
amending his unsigned Chinese version so as to bring it into accord with
the English judgment that had in fact been agreed upon. I went on to say
that after all it was not for our Government to devise a way out of the
difficulty, but simply to hold the Chinese Government to full compliance
with our treaty rights by whatever means might be available under the
Chinese system; and, in conclusion, I remarked that it was essential to
know whether we could count upon Chinese sovereignty to enforce our
rights, or whether that sovereignty was disposed to renounce in favor of
a foreign government the fulfilment of its obligations towards the
United States. I could obtain from the Minister for Foreign Affairs,
however, no more definite statement than that he would look into the
matter diligently and see what could be done.
The telegram from Consul Gauss under date of the 4th instant, and his
despatch No. 583 of the same date report what appears to be the final
settlement of the case. I can not but concur in his decision that this
final compromise judgment must be accepted as the best result obtainable
under the circumstances.
[Inclosure 1—Extract.]
Consul Gauss to
Chargé MacMurray.
American Consulate General,
Shanghai,
August 20, 1915.
Sir: Until such time, in the next few
days, as I am able to obtain a copy of the Chinese text of the
judgment of the Mixed Court and a copy of a seven-page protest filed
by the Japanese assessor, I quote for your information the English
text of the judgment as written on the charge sheet by Assessor
Bishop and by him communicated to me this afternoon:
The Court finds that the plaintiff’s goods were first used
and are therefore entitled to protection. The Court further
finds that the goods of the defendant are so similar to
those of the plaintiff as to constitute a violation of the
rights accorded to the plaintiff by the treaty. The verdict
is therefore that the defendants are guilty. The goods of
the defendant are to be held by the Court, and the
defendants cautioned against the future use of similar
articles.
Mr. Bishop informs me that the Japanese assessor made a most
strenuous objection to the proposed decision in favor of the
plaintiffs.
I have [etc.]
[Inclosure 2—Telegram—Paraphrase.]
Consul Gauss to
Chargé MacMurray.
American Consulate General,
Shanghai,
August 23, 1915.
It has been ascertained that the Chinese version of the judgment in
the Vaseline case does not agree with that of the assessor, but
confirms the Japanese contention. Investigating.
[Page 249]
[Inclosure 3—Telegram—Paraphrase.]
Chargé MacMurray
to Consul Gauss.
American Legation,
Peking,
August 24, 1915.
Referring to the foregoing telegram, the Legation advises the
Consulate General that the Minister for Foreign Affairs has promised
to telegraph the authorities at Shanghai asking for explanations and
urging them to take such steps as may still be feasible in order to
avoid the serious situation which would be created by the handing
down of a garbled Chinese version of the judgment.
[Inclosure 4—Extract.]
Consul Gauss to
Chargé MacMurray.
No. 574.]
American Consulate General,
Shanghai,
August 25, 1915.
Sir: With reference to my telegram of
August 23, I have now the honor to submit for the Legation’s
consideration a report on the judgment in the case of the
Chesebrough Manufacturing Co. vs. Tsang San Daung et al., in the
Mixed Court at Shanghai on August 19.
On August 14, Mr. Bishop had an interview with Magistrate Kuan and
reported to me that the latter was willing to agree to the judgment
as desired by this Consulate General and that Thursday, August 19,
had been set for the date of delivering such judgment.
On Wednesday, August 18, while at a reception at the Austro-Hungarian
Consulate General, Magistrate Kuan mentioned to Vice Consul Perkins
that this case was coming up on the following day and that he had a
compromise judgment to propose of which he requested that Mr. Bishop
be informed. Something interfered to interrupt this conversation,
but Mr. Perkins informed me of it promptly and the following morning
I saw Mr. Bishop, informed him that Magistrate Kuan had spoken of
having a compromise judgment and that he should be careful not to
agree to any judgment that did not fully lay down the principle of
priority of use, et cetera, for which we had been contending.
On Thursday evening Mr. Bishop came into my office from the Court and
reported that he had finally succeeded in having the judgment
rendered; that the judgment as delivered supported the principle of
priority of use; and he indicated that the Chinese text of the
judgment had gone even so far as to say that the priority had been
established by twenty years use on the market.
Mr. Bishop reported that at the protest of the Japanese assessor the
goods of the defendant which it had originally been agreed to
“confiscate” had been “held for the consideration of the court”
which might be said to be practically equivalent since no
disposition of them could be made without our consent. He also said
that as this case was a criminal one, the magistrate had held that
an injunction could not properly issue, but that he had agreed
instead to a warning.
I instructed Mr. Bishop to obtain copies of the English and Chinese
texts of the judgment, for transmission to the Legation and the
Department, and also a copy of the written Japanese protest which I
understood had been put in.
On Friday afternoon, I asked Mr. Bishop whether he had yet obtained
the judgment from the Mixed Court, as I had requested. He replied
that he had the English text, which he handed to me and to Attorney
Davies and said that the Chinese text and the copy of the Japanese
protest were being sent to him by the court.
On Saturday noon there was handed to me a letter from Magistrate Kuan
to Mr. Bishop with attached copy of the Chinese text of the judgment
of the court which was evidently in direct contradiction of the
judgment as reported to me by Mr. Bishop.
Mr. Bishop had left for Japan on vacation early Saturday morning, so
I could not consult him on the matter.
If the Chinese text of the judgment is permitted to stand, serious
harm will have been done to the American contention of principle in
these cases.
I have, therefore, instructed Vice Consul Perkins, who is resuming
his duties as assessor during the absence of Mr. Bishop, to write to
the magistrate protesting
[Page 250]
against the Chinese text of the judgment as not representing the
real judgment which, apparently, from the endorsement of the
assessor on the charge sheet, had been agreed upon by him with the
magistrate.
The attorney for the Chesebrough Manufacturing Company will consider
the advisability of immediately bringing a similar action against
other Chinese.
I have [etc.]
[Subinclosure—Translation.]
Judgment of the Mixed Court in Chesebrough
Manufacturing Co. v. Yung Kee Chiang et al. for infringement of
trade-mark.
After questioning, it has been clearly shown by the plaintiff that
this kind of vaseline has been in the Shanghai market for over 20
years, and it is alleged that the goods which the defendants have
been selling were bought from the Osaka Japanese merchant, Sung Peng
Tz’u Lang, and imported to Shanghai.
As to whether these goods are an infringement of the trade-mark of
the plaintiff, this question belongs to the Japanese courts for an
authoritative decision.
Inasmuch as the defendant’s goods now held in the court somewhat
resemble the plaintiff’s mark, the stock is to be detained for
examination and consideration.
The present case being a criminal action, this court does not deem it
fit to grant the application of the plaintiff for an injunction
against the sale of the defendant’s goods.
Should the plaintiff file any further suits against the defendants,
we will institute further inquiries and deal with the case according
to its merits.
The defendants are hereby released and the case finished.
Dated the 19th day of the
8th moon, 4th year of the Chinese
Republic.
[Inclosure 5.]
Chargé MacMurray
to the Minister for Foreign
Affairs.
American Legation,
Peking,
August 30, 1915.
Excellency: I have on several occasions
had the honor to discuss with your excellency the principle of
jurisdiction involved in the case, recently pending in the Mixed
Court at Shanghai, in which an American firm, the Chesebrough
Manufacturing Company, was prosecuting certain Chinese citizens,
Messrs. Yung Kee Chiang et al., for knowingly passing off an
imitation of the Vaseline trade-mark belonging to the American
company and entitled, under the terms of Article IX of the Treaty of
Commerce concluded between the American and Chinese Governments in
1903, to the protection of the Chinese Government to the full extent
of Chinese jurisdiction. Your excellency will recall that I have had
occasion to urge, and to note your concurrence in the view, that the
present case admits of no legal locus standi in favor of third
parties of other nationality, inasmuch as it concerns only the
treaty obligation of Chinese sovereignty to protect American
trade-mark rights from abuse by persons subject to that sovereignty,
whether by direct infringement or by giving currency to such
infringements originating elsewhere.
This Legation has now received from the American Consulate General at
Shanghai a report to the effect that on August 19 the judgment in
this case, as agreed upon by the magistrate and the American
assessor, was delivered in favor of the American plaintiffs, and was
noted in English upon the charge sheet by the American assessor in
the following terms:
Judgment. Chesebrough Manufacturing Co. v.
Yung Kee Chiang et al.
The Court finds that the plaintiff’s goods were first used
and are therefore entitled to protection. The Court further
finds that the goods of the defendant are so similar to
those of the plaintiff as to constitute a violation of the
rights accorded to the plaintiff by the treaty. The verdict
therefore is that the defendants are guilty. The goods of
the defendant are to be held by the court, and the
defendants cautioned against the future use of similar
articles.
[Page 251]
It is with the utmost chagrin, however, that the Legation has learned
that the judgment which the magistrate entered upon the Chinese
charge sheet is essentially different from that upon which he had
agreed with the American assessor and in which he acquiesced when it
was read by the assessor as the final decision in the case, and gave
judgment in the following terms in favor of the defendants on the
ground that the fact of infringement must be determined, even as
between American and Chinese citizens, by a Japanese court:
[Translation from the Chinese text.]
Judgment of the Mixed Court in Chesebrough
Manufacturing Co. vs. Yung Kee Chiang et al. for
infringement of trade-mark.
After questioning, it has been clearly shown by the plaintiff
that this kind of vaseline has been in the Shanghai market
for over twenty years, and it is alleged that the goods
which the defendants have been selling were bought from the
Osaka Japanese merchant, Sung Peng Tzu Lang, and imported to
Shanghai.
As to whether these goods are an infringement of the
trade-mark of the plaintiff, this question belongs to the
Japanese courts for authoritative decision.
Inasmuch as the defendant’s goods now held in the court
somewhat resemble the plaintiff’s mark, the stock is to be
detained for examination and consideration.
The present case being a criminal action, this court does not
deem it fit to grant the application of the plaintiff for an
injunction against the sale of the defendant’s goods.
Should the plaintiff file any further suits against the
defendants we will institute further inquiries and deal with
the case according to its merits.
The defendants are hereby released and the case finished.
Dated the 19th day of the 8th moon, 4th year of the Chinese
Republic.
Your excellency will not fail to note that between the English
judgment agreed upon between the magistrate and the assessor, and
entered by the latter upon the English charge sheet, and the Chinese
version put forth by Magistrate Kuan, there is a discrepancy not
merely accidental but fundamental: whereas the judgment agreed upon
gives the decision in favor of the plaintiff in recognition of the
rights and obligations of Chinese sovereignty for the purpose of
jurisdiction in such cases, the Chinese version of it acquits the
defendants on the ground that the obligations of the Chinese
Government to citizens of the United States under the terms of the
Treaty of 1903 are subject to the determination of courts of
Japanese jurisdiction.
Such a decision, even if regularly rendered and valid, could scarcely
be accepted by my Government as consonant with its treaty rights;
and the refusal of a Chinese court to take jurisdiction for the
protection of American treaty rights against abuse by citizens of
China cannot but be regarded as a denial of justice.
It is the fact, however, as admitted by Magistrate Kuan in an
interview with American Vice Consul Perkins, that the Chinese
version of the judgment in this case is not the actual judgment of
the Mixed Court, inasmuch as it does not accord with the
understanding reached between the magistrate and the assessor, and
does not bear the signature of the assessor or the seal of the
Court. The Legation therefore fully approves the contention set
forth by Mr. Perkins, acting as American assessor, in a
communication addressed to Magistrate Kuan on the 24th instant in
the following terms:
Sir: By your letter of August 19
you transmit to this office a Chinese text which you say is
the decision rendered after consultation in the above
case.
I have the honor to point out that this Chinese version is
directly opposed to the English version of the judgment of
the Court as it was read in open court, in your presence and
with your evident sanction and approval, by the American
Assessor, Bishop, who sat in the case.
The judgment of the Court as read by Mr. Bishop appears in
his handwriting on the English charge sheet.
The Chinese text submitted by you is distinctly opposed to
all principles of right and justice.
Furthermore it has not been sealed by the Court nor signed by
the Assessor. It is, therefore, not to be considered as
authentic.
That the American Assessor did not agree to such judgment but
arrived at an entirely different agreement with the Court
would appear from his endorsement made at the time on the
English charge sheet.
I am accordingly instructed to inform you that the
endorsement of the Assessor on the charge sheet, having been
read in open court as the judgment of the Court in the case,
in your hearing and with your apparent approval and consent,
will be considered by this Consulate General as the binding
judgment of the Court.
I am [etc.]
M. F. Perkins,
American Assessor.
In accordance with this view, I have the honor to request that your
excellency may be so good as to take such action as may prove
feasible in order to assure that the actual judgment of the Mixed
Court, as read and entered
[Page 252]
on the English charge sheet by the assessor in the case, may be
recognized as effective, and duly executed in spite of the
contradiction inherent in the garbled Chinese version thereof.
In making this request, I beg to reserve for eventual consideration
such action as the Government of the United States may deem to be
necessary in the event of a denial of justice to its nationals, as
also such representations as it may seem fit to make in reference to
the conduct of Magistrate Kuan.
I avail [etc.]
[Inclosure 6—Telegram—Paraphrase.]
Consul Gauss to
Chargé MacMurray.
American Consulate General,
Shanghai,
September 4, 1915.
Mr. Gauss reports that after a prolonged discussion the magistrate
has omitted from the Chinese text in the Vaseline case the sentence
in regard to the fact of infringement being a matter for
determination by the Japanese courts; and that Magistrate Kuan and
Assessor Bishop have signed the English and Chinese judgments, the
two texts to be considered as representing the opinion of the court,
save for the fact that the sentence “verdict of guilty” has been
deleted from the English text; this was a concession to the
magistrate, in order to induce action to break the persistent
deadlock, it being considered that the fact of the defendant’s guilt
appears from the sense of the judgments.
It seemed desirable to accept the settlement above outlined, in view
of the weakness of the excuse of misunderstanding made by the
assessor.
