In the early 1900s, liquor dealers Samuel Harper and Cyrus Reynolds in the military town of Fort Smith, Arkansas, faced a financial dilemma. What was to be done about the cutthroat competition from the proliferating saloons and cheap whiskey being shipped in from the East? Deciding that cheating was their best option, they issued their own brand under completely false credentials and thereby triggered a landmark trademark suit.
Both born about 1863, the two men were experienced in the liquor trade, both pouring whiskey in a saloon and selling packaged goods. Cyrus Reynolds had gotten his start as an employee of M.C. Wallace, a Fort Smith liquor dealer who carried a number of national brands. In time, Reynolds and a partner had bought out Wallace and continued operations. When that partnership dissolved, Reynolds joined the existing saloon and liquor house of Sam Harper and his brother. He eventually was made a full partner of Harper-Reynolds Co., located at 503 Garrison Street, shown below.
The new company soon found itself in deep financial waters. Although the owners could boast of being local agents for Miller Beer, they found themselves surrounded by dozens of other liquor outlets, some like Tom Taylor’s only steps away. Noting the popularity of Mellwood whiskey on their shelves, a scheme began to form in the minds of the partners. Why not provide an imitation that could sell for less and call it “Mill Wood”?
Meanwhile 670 miles northeast of Fort Smith in Louisville, Kentucky, George Washington Swearingen was basking in the success of his distillery, below, and particularly the nationwide sales of his Mellwood brand. As one observer said: “Beginning on a small scale it became one of the largest and most successful institutions in the state.” Shown here, insurance documents record a distillery built of brick and equipped with a fire-proof roof. The property contained seven warehouse, one a “free (no federal regulation) that stood 70 feet southwest of the still and six “bottled in bond” warehouses, all within 300 feet of the still.
Although Swearingen offered a wide variety of brands, his flagship label and best seller was Mellwood. A subject of vigorous marketing, the brand was promoted by frequent advertising in a wide range of national publications. Sold at retail in quart bottles and pint flasks, the Mellwood label became a familiar sight on liquor shelves all over America. Or as one publication stated: “…Being known far and wide as the equal of any in the market.” Faced with an impostor whiskey being sold in Fort Smith, Swearingen vowed retribution and filed suit in Federal District Court in the Arkansas city.
He did so at a propitious time. In the past trademarks has been loosely protected under state common law beginning in colonial times. Congress first attempted to establish a federal trademark regime in 1870, only to have the law struck down by the Supreme Court. In 1881 Congress retaliated by passing a new act. It was not, however, until 1905 when Congress revised and strengthened the Trademark Act that the laws had real “teeth.”
The suit was heard in December 1908 in the federal courthouse in Fort Smith, shown here. Testifying for the Fort Smith proprietors was Reynolds. He contended that the “Mill Wood” name was not chosen to mimic Mellwood but was named after his old home place in Indiana, a somewhat dubious claim. Reynolds chose, however, not to rebut any of the other charges involved in falsifying his company’s liquor.
The acusations included…:
The word “WHISKEY” in block letters was similar to those used for Mellwood, followed by red script letters spelling “Mill Wood,” also similar to red lettering on the Mellwood bottle. The word “Kentucky” was prominent and untrue.
The Mill Wood label featured a picture of a large distillery, containing captions “Mill Wood Distilling Co.” “Malt House,” “Warehouse,” “Cattle Pens.” In fact, Harper, Reynolds had no such facilities. Their whiskey was being concocted in their Fort Smith quarters from supplies distilled elsewhere and brought in by rail. The distillery picture was purely an artist’s invention.
The faux distillery view was followed by the designation “hand made,” “sour mash, and the following text: “The celebrated whiskey is made exclusively by the sour mash copper process, employed only in the distillation of the finest whiskeys, from carefully selected grains, and bottled only after being matured in barrels for years.” None of this was true.
Reynolds made no effort to refute any of Swearingen’s allegations. Instead, while admitting he and Harper had approved the label, he seemed to cast the blame on the lithographic company for having designed and printed it. Reynolds said the company had been sent 5,500 labels, that it had used 3,400 of them on quart, pint and half-pint bottles, and that the remaining 2,100 labels had been destroyed when Mellwood Distilling brought the lawsuit.
The Federal District Court asked: “What are the facts?” and proceeded to provide the answer in a single sentence: “There was no such distillery; the whiskey was put up and owned by defendants at Ft. Smith Ark., and was a blend and certainly a cheap whiskey; it was not put up by any fire copper process; it was not made in Kentucky; it was not celebrated; it was not made of selected grain; it was not matured eight years in barrels before being bottled; it was not [just] distributed by the Harper-Reynolds Liquor Company; it was both owned and sold by that company; it was not sour mash; it was not hand made; the picture on the label of the distillery was not the picture of any distillery; the descriptions on the picture were untrue.”
The Court then granted an injunction to the Mellwood plaintiffs, restraining Harper and Reynolds from use of the label, and referring the case to a master to determine the ill-gotten profits, assess damages and set court costs. Although the decision was reached early in December 1908, the verdict was delayed on a technicality by the defendants’ lawyers until late January, 1909.
My presumption is that back in Fort Smith, although Harper and Reynolds continued to sell Mellwood whiskey for $1.25 a quart, their erstwhile Mill Wood brand, at 75 cents a quart, was a thing of the past. The partners did not have long to continue in the liquor business. Things were changing rapidly in Fort Smith as the population was shifting away from the original boisterous military base town to a more sedate environment. In August 1914, Fort Smith was voted “dry” and all saloons and liquor houses ordered to shut down. That order was followed on January 1, 1916, when the entire state of Arkansas embraced prohibition.
After being shut down by the “dry” sentiments sweeping the country, Harper and Reynolds went their separate ways. Harper became the vice president of a Fort Smith clothing manufacturer, Flyer Garment Company. Also as a vice president, Reynolds joined a wholesale grocery firm, owned by a relative, called Reynolds-Davis.
Sam Harper was the first to die at the age of 69, in 1932 committing suicide by carbon monoxide while sitting in a running automobile in his garage. Cyrus Reynolds died in 1946, age 82, of natural causes and was buried in Forth Smith’s Oak Cemetery. The grave markers of both men are shown below.
Addendum: A 1920 study from Columbia University called “A Psychological Study of Trade-Mark Infringement” highlighted the inconsistency among approximately forty trademark legal decisions the researchers examined. They found that among control groups the likelihood of consumers mistaking “Mill Wood” for “Mellwood” was at the low end of probability.
Note: The Mellwood/Mill Wood trademark case in many ways was a landmark decision. Earlier whiskey cases tried in the home city of a defendant usually were followed by acquittals. In this case the federal judges in the Arkansas city came down hard on locals Harper and Reynolds. For those interested in such legal issues, I highly recommend the book “Bourbon Justice: How Whiskey Law Shaped America” by Brian Haara. Although this post was written from original court documents, Atty. Haara’s informative book initially alerted me to the Fort Smith story.
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