812.543 Palmolive Co./67

The Chargé in Mexico ( Lowry ) to the Secretary of State

No. 2555

Sir: I have the honor to refer to my despatch No. 2525 of June 9, 1930,71 with which there was transmitted a translation of the Supreme Court’s decision in the case of Chickering and Sons vs. Munguia, which decision seems to be a reversal of the opinion of the Supreme Court as laid down in the case of the Palmolive Company, which case was the subject of the Department’s instruction No. 1101 of May 9, 1930.

A Spanish copy of the Supreme Court’s decision has now been received by the Embassy and is enclosed, together with a copy of a carefully checked translation thereof.

I have [etc.]

Edward P. Lowry
[Enclosure—Translation]

Decision of the Supreme Court of Mexico in the Case of Chickering and Sons vs. Munguia, May 2, 1930

Mexico, D. F. Decision of the First Chamber of May 2, 1930.

Having reviewed the proceedings in the amparo suit brought by Chickering and Sons, and

Considering

First: By means of a complaint presented before the First Supernumerary District Judge of the Federal District (now Third District Judge), on November 21, 1927, Mr. Raymond R. Billings, as attorney for Chickering and Sons, initiated a suit for amparo against acts of the Second Numerary District Judge in the Federal District, consisting in the order of October 27th of the said year rendered in the criminal proceedings initiated on the complaint of Mr. Enrique Munguia against Mr. José F. Velasquez for the crime of infringing the trade [Page 581] mark “Chickering” and which order was for the attachment of two pianos bearing the Chickering trade mark.

The principal facts as set forth in the complaint are: that the said Company is the manufacturer of pianos known throughout the world by the name of “Chickering Pianos” and the Company places its name on its products with the object of distinguishing the same from similar ones and indicates to the public in this manner the origin thereof; that the said Company had been selling its products in Mexico to Mr. Enrique Munguia to the exclusion of any other merchants and vested all of its confidence in him; that Mr. Munguia registered the trade mark “Chickering” as a commercial registration of his own property on July 8, 1909, and assigned the same to the complainant by means of a document executed before a Notary Public on April 25, 1910; that inasmuch as Munguia failed to pay Chickering and Sons, as well as other Companies, the value of the pianos which he had ordered from them for sale in Mexico, the said Company refused to grant further credit and sold its products to other persons; that, thereupon, Mr. Munguia re-registered the trade mark “Chickering” in his own name, and no obstacle was encountered in doing this in view of the Mexican system of registration which does not require any examination as to novelty; that on the basis of this latter registration the said Munguia initiated various judicial proceedings with the sole object of harassing the companies which had sold him merchandise over a long period of time; among these proceedings is the investigation in connection with the infringement of a trade mark brought against the present seller of Chickering pianos in Mexico, namely Mr. J. F. Velasquez, and in which proceedings the Judge in charge of the case, i. e., the Second Numerary District Judge in the Federal District, handed down the order which is the basis of this complaint, and which order was attempted to be executed.

Mr. Billings sets forth as guarantees which have been violated to the prejudice of his principal, by virtue of the order complained against, those contained in Articles 14 and 16 of the Constitution, because in making such order the law was incorrectly applied and the said order is therefore without basis and without foundation. For the purpose of justifying the basis for this contention, the complainant makes the following three arguments:

I.
That in accordance with Section II of Article 30 of the Law of Industrial and Commercial Trademarks, it is an indispensable requisite to the owner of a trade mark asking for the attachment of infringing articles that proof be presented that he is the owner of said mark, which circumstance was not only unproven by Mr. Munguia in the said proceedings, but on the contrary, it was established that Chickering and Sons were the owners of the said trade mark by virtue of an assignment made in their favor.
II.
That under Section III of the said Article 30, it is essential for the purpose of ordering the attachment referred to that the corpus delicti of the infringement of industrial and commercial trademarks be proven; and among the integral elements of this crime is one requiring the owner of the trade mark to place on the objects covered thereby the legend referred to in Articles 9 and 14 of the said Trade Mark Law; and inasmuch as it was not proven that the legend referred to in Articles 9 and 14 were so affixed, the said crime cannot exist and therefore an order of attachment against pianos bearing the Chickering trade mark should not have been issued.
III.
That in ordering the attachment referred to above, the Court concluded that Munguia has the right to use the trade mark “Chickering” on his products and that Chickering and Sons do not have the right to place their own name on the pianos which they manufacture. The Court therefore failed to recognize the protection which is granted to manufacturers by Article 8 of the decree of March 13, 1925, which reads as follows: “Commercial names shall be protected in all countries of the Union without necessity of registration whether or not they form a part of a commercial or industrial trademark.”

Second: Mr. Raymond R. Billings established his representative capacity by a certified copy of the instrument containing the power of attorney conferred upon him by the complainant Company in New York before Notary Gertrude Winters on September 15, 1927, and which power after being duly translated and compared was protocolized before Notary Lie. Juan J. Correa Delgado by order of the Seventh Civil Judge of this City.

There was also attached to the complaint a photostatic copy of the registration of the “Chickering” trade mark effected by Mr. Enrique Munguia on July 8, 1909, as well as a certificate to the effect that the assignment of this registration had been recorded in the name of the complainant Company on February 1, 1926.

Third: The responsible authority in its report of justification, forwarded a certified copy of various proofs which are contained in the criminal proceedings brought against the illegal use of the trade mark complained of by Mr. Munguia, and among which proofs is contained the order forming the basis of the complaint, which reads as follows:

“Mexico, October 27, 1927. Attach to this record the petition of the 25th instant presented by Mr. Enrique Munguia, and in accordance with his request and having fulfilled, in the opinion of this Court, the requirements referred to in Article 30 of the Law of Industrial and Commercial Trade marks, and relying on said Article and also on Article 31 of the said law and Article 49 of the Organic Law of the Judicial Power of the Federation, carry out the attachment of the two pianos bearing the trade mark ‘Chickering’ referred to by the plaintiff and deposit the same with the person appointed under the [Page 583] responsibility of Mr. Enrique Munguia, and who shall be informed of the obligations which by virtue of the law correspond to his position; the Clerk in charge of the Penal Section of this Court, Lie. Emilio Hazas, being authorized to effect the attachment in question, on the understanding that the said proceedings shall be carried out in the places specified heretofore in this record.”

Fourth: By decision of December 30, 1927, the present Third District Court in the Federal District, in accordance with the recommendations of the Government Attorney attached to said Court, granted the amparo requested, having previously studied the reasons for dismissal alleged by the third party to the action, that is, with reference to the capacity of the complainant company to ask for the protection of Federal justice, which reasons are considered to be nonexistent by said Court. With regard to the basic questions involved, the said Court reached the conclusion that inasmuch as it was established in the record of the proceedings forming the basis of this complaint, that the owners of the commercial trade mark referred to are Chickering and Sons, the said order violated the said guarantees contained in Articles 14 and 16 of the Federal Constitution.

Fifth: Against this decision Mr. Munguia appealed, alleging as errors the ones which will be mentioned in the final part of this decision.

Sixth: The appeal was admitted by the Supreme Court on January 26, 1928, and the file was turned over to the Government Attorney for the period fixed by law and said Attorney requested that the decision be confirmed.

Wherefore: I. The points raised by the third party in his bill of exceptions may be reduced to the ones hereinafter set forth:

(a)
That the firm of Chickering and Sons has no capacity to initiate the present suit in view of the fact that it did not establish compliance with the requirements of protocolization of its by-laws and other organization documents, and that the Company was duly organized in accordance with the respective law in accordance with the necessary Consular Certificate, and that it was inscribed in the Commercial Registry of the Republic; which requirements are set forth in Articles 14, 15, 24 and 265 of the Commercial Code with regard to foreign companies; therefore the decision appealed from in failing to go into the question of the capacity of the complainant and which lack of capacity raises the question of dismissing the action, violated to the prejudice of the appellant Articles 3, 6 and 43, Section 8, of the Law of Amparo.
(b)
That, bearing in mind the provisions of Article 1285 of the Civil Code of the Federal District, it is absurd to require, as is done in the decision appealed from, that the retraction made by Mr. Enrique Munguia, the third party, from the assignment which he executed [Page 584] with Mr.Roberto D. Zarate with regard to the Chickering trade mark, should be contained in a public document in which should be set forth the acceptance of such retraction by the complainant.
(c)
That the conclusion reached in the said decision that the complainant is the only one in a position to request the attachment of the objects covered by the Chickering trade mark is erroneous and implies a failure to recognize the facts proven in the record, in accordance with which the sole owner of this mark is the third party.

II. In order to decide the first one of the questions propounded above, it is necessary to determine whether the provisions which foreign companies must observe, in accordance with Articles 15, 24 and 265 of the said Commercial Code, in order to establish Agencies or Branches in the Republic for the purpose of carrying on business, are likewise to be observed when said companies appeal to the Federal Courts asking for amparo.

Article 6 of the Regulatory Law recognizes the right of civil or mercantile companies without distinction as to nationality, to request the Constitutional protection through the agency of their duly authorized representatives or duly constituted attorneys so that, in accordance with this provision, it is sufficient that the person initiating a suit of this nature establish the legal existence of the Company and the capacity of the representative thereof in order that the right to invoke the said Constitutional protection be considered unquestionable. Consequently, the text of Article 6 relied upon does not substantiate the arguments of the appellant with regard to this point, nor do they find any support in Articles 15, 24 and 265 of the Commercial Code, inasmuch as these provisions refer to the requirements governing the carrying on of business in the Republic by foreign companies, and it cannot be seriously alleged that requesting amparo is a commercial act.

In support of this theory, it is in order to insert what is set forth by Moreno Cora in his work on Amparo Suits, which is as follows:

“Although the foregoing may appear sufficient to decide the question under discussion, it will not be superfluous to note that the daily increase in our commercial relations will bring about the greater application of the theory that extends the benefits of amparo to persons who do not reside in the Republic. It was thus held by certain professors who discussed this matter in the Academy of Jurisprudence and the protection of Federal justice was considered as extending to moral persons who reside abroad, provided they have a legal existence in the country in which they are domiciled.”

In the case under consideration, Mr. Raymond R. Billings established the fulfillment of the requirements of Article 6 of the Law of Amparo, inasmuch as it appears from the certified copy of the protocolization of the document which was attached to the complaint that [Page 585] the firm of Chickering and Sons was duly organized and existing in accordance with the laws of the State of Massachusetts, United States of America, and that Alfred Wagner, as President of said Company, and with express authorization, conferred on behalf thereof a full, complete and general power of attorney in favour of Mr. Billings, and for this reason the basis for denial alleged by the appellant does not exist.

III. Although there may be errors in the reasoning contained in the third paragraph of the decision challenged by Munguia, which paragraph states that in order to establish the validity of the retraction from the assignment contained in the instrument of April 25, 1910, it was necessary that said retraction be contained in a public document, accepted by the complainant Company, such error is insufficient to bring about the revocation of the said decision and denial of the amparo inasmuch as there would still remain the final question involved, i. e., that the Third District Judge held that the sole owner of the trade mark under dispute is the complainant Company.

In accordance with the report of the Patent and Trade Mark Office of the Department of Industry, Commerce and Labor, a certified copy of which is contained on page 42 of the file in first instance, and which is competent evidence in accordance with Article 258, Section II, and Article 332 of the Federal Code of Civil Procedure, the owner of the trade mark “Chickering” in the year 1927, in which the order of attachment appealed from was rendered, and in accordance with the respective file, was the complainant Company; consequently, in recognizing this ownership the decision appealed from does not commit any error to the prejudice of the third party, the more so if it be borne in mind that in one of the title documents presented by Mr. Munguia before the Court there is contained the registration in the Patent and Trade Mark Office of the assignment of the trade mark above mentioned which was executed between him and Chickering and Sons, and this is not the place to decide regarding the invalidity of the said assignment and of its registration because amparo suits do not decide questions of this nature, and for the further reason that said invalidity is the basis of a summary suit brought by the third party before the present Fifth District Court in the Federal District.

In view of the foregoing, and based moreover, in addition to the legal provisions cited, on Articles 86, 90 and 91 of the Law Regulating Amparo Suits, and Article 24 and Transitory Article 6 of the Organic Law of the Judicial Power of the Federation, it is resolved:

  • First: The decision of the present Third District Judge in the Federal District of December 30, 1927, should be and is hereby affirmed, and consequently:
  • Second: The Justice of the Union protects and defends Chickering and Sons, of Boston, Massachusetts, United States of America, [Page 586] against the act of the Second Numerary District Judge in the Federal District, consisting of the order of October 27th, of the said year, handed down in the proceedings instituted upon the petition of Enrique Munguia, for the illegal use of the trade mark “Chickering” which act was appealed from, the order referred to being for the attachment of merchandise bearing the Chickering trade mark.
  • Third: Notify the Government Attorney and through the Agency of the respective District Judge, notify the other parties who intervened in said suit, and for this purpose issue a copy which, after the same has been duly dispatched through the usual channels shall be returned to this Supreme Court; issued the decision and this record of amparo, return the same to the Lower Court; publish the same and file this record.

So, by a unanimity of five votes, it was decided by the First Chamber of the Supreme Court of Justice of the Nation. The Magistrates who compose this Chamber and the authorized Secretary, signed, stating that because of the physical incapacity of President Osarno Aguilar, Magistrate Carlos Salcedo signed for him. I certify, Magistrates P. Macharro y Navaez. F. de la Fuente. Carlos Salcedo. F. Barba. Secretary, E. Manrique. Scrolls.

  1. Not printed.