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YE OLDE TAVERN CHEESE PROD., v. PLANTERS PEANUTS

September 29, 1966

YE OLDE TAVERN CHEESE PRODUCTS, INC., AN ILLINOIS CORPORATION, PLAINTIFF,
v.
PLANTERS PEANUTS DIVISION, STANDARD BRANDS INCORPORATED, A DELAWARE CORPORATION, DEFENDANT.



The opinion of the court was delivered by: Decker, District Judge.

  MEMORANDUM OPINION

This is a suit for trademark infringement, unfair competition, trademark dilution and injury to business reputation. It has been brought under the Lanham Act, 15 U.S.C. § 1051-1127, under Illinois statutes dealing with trademark registration, Ill.Rev.Stat. ch. 140, §§ 8-22 (1965), and under common law principles of trademark infringement and unfair competition.

Plaintiff, Ye Olde Tavern Cheese Products, Inc. (formerly Cheese Products Co., Inc.) is an Illinois corporation, engaged in the wholesale distribution of various snack products and accessories for use in the tavern or restaurant trade. Defendant, Planters Peanuts Division, Standard Brands, Inc., is a Delaware corporation, with its principal place of business in New York City, and with a regular office in Chicago, Illinois. Defendant processes and sells various nuts and other snack products in interstate commerce, including the Chicago area.

Plaintiff's predecessor initially registered the mark "Ye Olde Dairy Tavern" with the United States Patent Office on November 2, 1937 (U.S.Reg. No. 351,558), for use on various dairy products. Plaintiff amended this registration in 1957, changing the mark to "Ye Olde Tavern," and limiting its use to cheese products. On January 22, 1957, plaintiff obtained registration of the mark "Ye Olde Tavern" in English script for use on cheese, mayonnaise, salad dressing, pickle relish, lemon beverage mix, cherries and olives (U.S.Reg. No. 640,431). Finally, on December 12, 1965, after the commencement of this suit, plaintiff obtained registration of "Ye Olde Tavern" for use on a variety of products, including those listed above, salted and unsalted nut meats, anchovies and sardines (U.S.Reg. No. 800,467). Plaintiff obtained Illinois registration of "Ye Olde Tavern" in English script in 1939, and renewed this registration for ten years from January 1, 1957, in 1956 (Ill. Reg. No. 16,549).

Commencing at least as early as 1958, plaintiff has been packaging and distributing various snacks, including salted and unsalted nut meats, in individual cellophane bags stapled to large cards. Plaintiff sells and has sold these products primarily to taverns, restaurants and cocktail lounges, generally through middlemen referred to as "wagon distributors." The individual bags and the cards have borne the label "Ye Olde Tavern" in English script and superimposed upon a facsimile of a wooden signboard. Plaintiff's sales have been generally limited to the Chicago area, roughly fifty to seventy-five miles from the city.

In July 1964, defendant Planters placed for sale on the Chicago market a product which it identified as "Planters Ye Olde Tavern Nuts." This product was packaged in individual cellophane bags, packed in small boxes which could be opened up as display cases. Defendant advertised this product for sale primarily to taverns and bars. It is apparent from the evidence and testimony that these nuts were "dry roasted, sugar coated, redskin peanuts" and designed to compete with similar nuts, such as "Beer Nuts." After receiving notice from its Chicago office of plaintiff's objections and the filing of a complaint in the present suit, defendant immediately removed its product from the market. About three months later, defendant reintroduced this product, in the same form, but under the label "Planters Tavern Nuts." These nuts have since been been sold, aside from temporary withdrawal due to product quality problems, in the Chicago area generally to the same retailers as plaintiff's.

Plaintiff's amended and supplemental complaint seeks relief with respect both to defendant's use and sale of "Planters Ye Olde Tavern Nuts" and "Planters Tavern Nuts." The relief sought on each cause of action includes an injunction against defendant's use of "Ye Olde Tavern" or "Tavern" on its products in the Chicago area, an accounting of profits, treble damages and costs and fees.

Initially, defendant brought a counterclaim for trademark infringement and unfair competition, based on defendant's registration of "Cocktail" (U.S.Reg. No. 658,864) and plaintiff's designation "Cocktail Treat" on its packages of nut meats. Defendant has offered no proof on this counterclaim and seeks its dismissal. However, plaintiff has refused to stipulate to this dismissal and has alleged and sought to prove as an affirmative defense that defendant's trademark is invalid in that it was procured through fraud and also has been abandoned. Plaintiff seeks cancellation of this mark.

This Court has jurisdiction in this suit by virtue of the federal trademark laws (15 U.S.C. § 1051-1127), 28 U.S.C. § 1338, and diversity of citizenship of the parties.

A trial has been held by the Court, and this opinion is based upon the evidence introduced in the trial and the briefs filed by the parties. The opinion embodies the findings of fact and conclusions of law required by Rule 52(a), Federal Rules of Civil Procedure.

I.

Plaintiff's first cause of action concerns defendant's use of "Ye Olde Tavern" for a very short period in 1964. Testimony at the trial disclosed that the first sale of defendant's product under this label occurred in June 1964, that shipment to the first customer was made on or about July 5 or 6, 1964, that the Chicago office reported plaintiff's objection to the New York office on about July 9, 1964, and that the product was immediately removed from the market on about July 15 or 16, 1964, after notice was received of the filing of plaintiff's present suit. There was no evidence that defendant has since marketed or intends to market products bearing this label. An injunction is not available here. See, e.g., Champion Spark Plug Co. v. Reich, 121 F.2d 769 (8th Cir. 1941); cf. Walling v. T. Buettner & Co., 133 F.2d 306 (7th Cir.) cert. denied 319 U.S. 771, 63 S.Ct. 1437, 87 L.Ed. 1719 (1943). Plaintiff has not shown any damages or harm resulting from this specific act. Any sales which actually occurred would have been minimal. Therefore, I hold that plaintiff is not entitled to relief under its first cause of action.

II.

Essentially, plaintiff's case is one of trademark infringement under the common and statutory law.*fn1 Its proof consisted of demonstrating that it had obtained prior registration and use of the trademark "Ye Olde Tavern," that defendant subsequently used the word "Tavern" in competition with plaintiff, and in the submission of samples of the two bags and other items bearing the labels of defendant and plaintiff. The evidence also established that defendant knew of plaintiff's mark and operations in the Chicago area at the time defendant entered that market in 1964 with products containing "Tavern" on their labels.

The test for trademark infringement is generally stated to be "likelihood of confusion" of ordinary purchasers purchasing in the ordinary manner. See, e.g., McLean v. Fleming, 96 U.S. (6 Otto) 245, 251, 24 L.Ed. 828 (1877). Trademark infringement should be distinguished from unfair competition; the former is a narrower concept based upon the use by another of one's distinctive mark, or of a salient part of it, and does not necessarily depend upon the whole appearance or "dress" of the products. The plaintiff in a trademark infringement suit has an easier burden of proof, in that the prior use of the trademark gives rise to a presumption of exclusive right to it, and renders unnecessary proof of an actual intent to defraud or of specific association by purchasers of the mark with the producer. Moreover, registration under the Lanham Act or Illinois statute creates a presumption of adoption and continued use and is prima facie evidence of validity. The plaintiff in a trademark infringement suit must show prior use of its own mark and the defendant's use of a "confusingly similar" mark in competition with it. See generally 1 Nims, Unfair Competition and Trade-Marks §§ 1, 221b-221p (4th ed. 1947).

There is no problem here as to the prior use by the plaintiff of its own mark. The only question is whether plaintiff has shown that defendant ...


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