Complaint.

FEDERAL TRADE COMMISSION

v.

FRED A. MALTBY AND CLARENCE W. MALTBY, AS INDIVIDUALS AND AS PARTNERS.

COMPLAINT IN THE MATTER OF THE ALLEGED VIOLATION OF SECTION 5 OF AN ACT OF CONGRESS APPROVED SEPTEMBER 26, 1914.

SYLLABUS.

Docket 944-February 8, 1923.

Where two taxicab concerns built up a large and valuable good will as the Yellow Cab Co., and Black & White Taxi Co., respectively; and thereafter a competing concern,

(a) Caused its business to be listed and advertised in the local telephone directory as the "Yellow Bell Taxi Co.", "Yellow Ford Taxi Co.", and "Black & White Ford Taxi Co.", so that by reason of alphabetical arrangement its business as so named, listed, and advertised immediately preceded and/or followed the names of said concerns, and they were thereby deprived of a portion of the good will and patronage that should have accrued to them; and

(b) For the purpose of preempting their use and with a tendency and capacity to mislead and deceive the public and thereby secure its patronage, caused its business also to be listed and advertised therein under a large number of other names, some of which were well and favorably known as those of taxicab companies operating in other cities:

Held, That such misleading adoption and use of trade names, and such false and misleading advertising, under the circumstances set forth, constituted unfair methods of competition.

COMPLAINT.

Acting in the public interest pursuant to the provisions of an Act of Congress, approved September 26, 1914, entitled "An Act to create a Federal Trade Commission, to define its powers and duties, and for other purposes," the Federal Trade Commission charges that Fred A. Maltby and Clarence W. Maltby, a copartnership, doing business under the name and style of Yellow Bell Taxi Company, and Yellow Ford Taxi Company, hereinafter referred to as Respondents, have been and are using unfair methods of competition in commerce in violation of the provisions of Section 5 of said Act, and states its charges in that respect as follows:

PARAGRAPH 1. Respondents, Fred A. Maltby and Clarence W. Maltby, have for more than two years last past been engaged in the business of operating taxicabs for hire in the City of Washington, District of Columbia, both as a copartnership and as individuals, with their principal office and place of business in said City and Dis

trict. Respondents in the course and conduct of their said business have advertised and operated under a great number of trade names, more specifically set out hereinafter, among which is the "Arcade Taxi Service." In the course and conduct of their said business, respondents are in competition with other persons, partnerships and corporations similarly engaged.

PAR. 2. The Yellow Cab Company is a corporation created and existing under the laws of the State of Delaware, with its principal office and place of business in the City of Washington, District of Columbia, where it is engaged in operating taxicabs for hire in said City and District. Said Yellow Cab Company advertises its said business by means of advertisements and listings which it causes to be placed in the directory of the Chesapeake & Potomac Telephone Company, a telephone company rendering telephone service to the public in Washington City and the District of Columbia. The aforesaid cabs operated by the Yellow Cab Company are painted yellow, in conformity with said trade name, and bear upon the door the legend, "Yellow Cab Company." Since the commencement of its said taxicab business the said Yellow Cab Company has built up a large and valuable good will amongst the general public in the City of Washington, District of Columbia, for its said taxicabs.

PAR. 3. The Black & White Taxi Company is a corporation created and existing under the laws of the District of Columbia, with its principal office and place of business in the City of Washington, District of Columbia, where it is engaged in operating taxi cabs for hire in said City and District. Said Black & White Taxi Company advertises its said business by means of advertisements and listings which it causes to be placed in the directory of the Chesapeake & Potomac Telephone Company, a telephone company rendering telephone service to the public in Washington City and the District of Columbia. The aforesaid cabs operated by the Black & White Taxi Company are painted black and white and bear four monogramsone on each door, one on the back of the cab and one on the cowi, which monogram consists of a black rimmed circle around which is inscribed the words, "Black & White Taxi." Since the commencement of its said taxi cab business, the said Black & White Taxi Company has built up a large and valuable good will amongst the general public in the City of Washington, District of Columbia, for its said taxi cabs.

PAR. 4. Respondents placed or caused to be placed certain advertisements and listings in the fall issue of said telephone directory of the Chesapeake & Potomac Telephone Company which was issued by

66

said Company about November 1, 1921, in which said respondents caused to be set out and advertised the names Yellow Bell Taxi Company," and "Yellow Ford Taxi Company." Because of the alphabetical arrangement of said names, the said name, "Yellow Bell Taxi Company" appeared immediately above the name of the said Yellow Cab Company, hereinafter mentioned, and the name "Yellow Ford Taxi Company," appeared immediately below the said name "Yellow Cab Company" in the listings in said directory. PAR. 5. Respondents, in the fall issue of the telephone directory of said Chesapeake & Potomac Telephone Company which was issued by said Company about November 1, 1921, placed or caused to be placed certain advertisements and listings in said telephone directory in which said advertisements and listings respondent caused to be set out and advertised the name of “Black & White Ford Taxi Company." Because of the setting out of the said name, "Black & White Ford Taxi Company" in the listings of said directory, the said name, "Black & White Ford Taxi Company" appeared immediately above the name of the "Black & White Taxi Company."

PAR. 6. Because of the adoption by respondents of the said names, "Yellow Bell Taxi Company" and "Yellow Ford Taxi Company," and because of the alphabetical arrangement of those said names as set out in paragraph 5 hereof, respondents have diverted from the said Yellow Cab Company a portion of the good will and patronage that should have accrued to it. Because of the adoption by respondent of the said name "Black & White Ford Taxi Company," and because of the alphabetical arrangement of said name as set out in Paragraph 5 hereof, respondents have diverted from the said "Black & White Taxi Company" a portion of the good will and patronage that should have accrued to it. Respondents, from time to time in the two years last past listed and advertised in said telephone directory of the said Chesapeake & Potomac Telephone Company, under some fifty-odd additional names set out next below and sought to preempt to themselves the use of these said names within the City of Washington and the District of Columbia, and to prevent other taxi cab companies from operating under or using any of these said

names:

A-Bee Taxi,

Arcade Cab Service,

Arcade Taxi,

Arcade Taxicabs,

Arcade Taxi Service,
Bell Taxi,

Bell Taxicabs,
Bell Taxi Service,
Blue & Gray Taxi,
Blue Ribbon Taxi,
Bring-You-Back Taxi,
Brown & Black Taxi,

PAR. 7. A number of said names so listed by respondents are used by taxi cab companies operating in various other cities of the United States, and enjoy a large and valuable goodwill in said cities, and the use by respondents of said names in the manner herein before set out has the tendency and capacity to mislead and deceive the public, who are familiar with the said names so adopted by respondents and used in other cities, into the belief that the said names listed and advertised by respondents, as aforesaid, are operated by the said taxicab companies and render a service similar to the service rendered by said companies in other cities and cause the public to patronize the taxi cab service of respondents in that belief.

PAR. 8. The acts and things done by respondents, and each of them, as hereinabove alleged, are false and misleading and prejudicial to the public and to the competitors of the respondents, and constitute unfair methods of competition in commerce in violation of Section 5 of an Act of Congress, entitled, "An Act to create a Federal Trade Commission, to define its powers and duties, and for other purposes," approved September 26, 1914.

REPORT, FINDINGS AS TO THE FACTS, AND ORDER. Pursuant to the provisions of an Act of Congress approved September 26, 1914, the Federal Trade Commission issued and served

a complaint upon respondents, Fred A. Maltby and Clarence W. Maltby, as individuals and as partners, charging them and each of them with the use of unfair methods of competition in commerce in violation of the provisions of said Act.

Said respondents having entered their appearance and filed their answer therein and having made, executed and filed an agreed stipulation as to the facts, in which it is stipulated and agreed by the respondents that the Federal Trade Commission shall take such stipulation as to the facts in this case in lieu of testimony and proceed forthwith upon such stipulation to make its findings as to the facts and such order as it may be prepared to enter therein without the introduction of testimony, the Federal Trade Commission has duly considered the record and now being fully advised in the premises, makes this its findings as to the facts and conclusion:

FINDINGS AS TO THE FACTS.

PARAGRAPH 1. Respondents, Fred A. Maltby and Clarence W. Maltby, and each of them, have for more than two years last past been engaged in the business of operating taxicabs for hire in the City of Washington, District of Columbia, with their principal office and place of business in said City and District. In the course and conduct of their said business they have advertised and operated under a great number of trade names among which is the "Arcade Taxi Service." In the course and conduct of their said business respondents are in competition with other persons, partnerships and corporations similarly engaged.

PAR. 2. The Yellow Cab Company is a corporation created and existing under the laws of the State of Delaware, with its principal office and place of business in the City of Washington, District of Columbia, where it is engaged in operating taxicabs for hire in said City and District. Said Yellow Cab Company advertises its said business by means of advertisements and lists which it causes to be placed in the directory of the Chesapeake & Potomac Telephone Company, a telephone company rendering telephone service to the public in Washington City and the District of Columbia. The aforesaid cabs operated by the Yellow Cab Company are painted yellow in conformity with said trade name and bear upon the door the legend "Yellow Cab Company." Since the commencement of its said taxicab business, the said Yellow Cab Company has built up a large and valuable good-will amongst the general public in the City of Washington, District of Columbia, for its said taxicab service.