## Facts

- In 1964, Galt House, Inc. incorporated in Kentucky using “Galt House” as its corporate name.
- The corporation never paid in the required minimum capital, maintained no books or records, and had no assets, liabilities, or operations.
- The corporation did not operate a hotel or otherwise use “Galt House” publicly as a trade or service name; its principal made only intermittent, unsuccessful inquiries about possible hotel development.
- Home Supply Company, an established Kentucky hotel constructor/operator, began a riverfront high-rise hotel project in Louisville.
- In 1969, Home Supply submitted plans for the new hotel using the name “Galt House,” a name suggested by local public officials.
- The project was referred to publicly as the “Galt House” during discussions leading up to bidding and thereafter.
- Galt House, Inc. sued to enjoin Home Supply and its president from using “Galt House” as the hotel’s trade name, asserting priority based on its earlier corporate filing.

## Issues

1. Whether adopting a corporate name in articles of incorporation, without capitalization, operations, or public use, creates enforceable exclusive rights sufficient to enjoin another business’s bona fide use of the same name as a hotel trade name.

## Decision

- The Kentucky Court of Appeals affirmed the denial of injunctive relief.
- The court held that corporate name adoption alone, without actual business use and development of goodwill, does not create enforceable trade-name rights.
- Because the plaintiff had not used “Galt House” in commerce or established public association with the name, it lacked a protectable interest to bar defendants’ active use.

## Legal Principles

- Priority in a trade name or trademark is grounded in actual use in commerce and the goodwill arising from that use, not merely in corporate registration.
- A dormant or nonoperating corporation that has not used a name publicly cannot obtain an injunction to prevent an active, good-faith user from adopting and using the same name.
- Injunctive relief in unfair competition requires a protectable interest (including goodwill) and equitable circumstances supporting restraint; a “bare name” unconnected to business use is insufficient.

## Conclusion

The court refused to give exclusive rights in “Galt House” to a corporation that existed only on paper and never used the name in business, holding that enforceable trade-name protection requires actual use and resulting goodwill rather than mere incorporation under the name.


Galt House, Inc. v. Home Supply Co., 483 S.W.2d 107 (Ky. Ct. App. 1972)