The opinion of the court was delivered by: Will, District Judge.
This action, as its title may suggest, involves a trademark
dispute between two businesses in the floral products and
services industry. The plaintiff alleges that the similarities
between its registered trademark FLORALIFE and the defendant's
FLORALINE mark have resulted or are likely to result in
confusion to the public, damage to the plaintiff's business,
and invasion of its state and federal trademark protections.
Before us are two fullybriefed motions: the defendant's motion
to dismiss for improper venue or, alternatively, to transfer to
the Eastern District of Michigan; and the plaintiff's motion
for a limited preliminary injunction. For the reasons stated
below, the defendant's motion is denied and the plaintiff's
motion is granted.
For nearly fifty years, the plaintiff Floralife, Inc.
("Floralife") and its predecessor, Amling Company, have been
engaged in the business of supplying specialty products for
florists under the FLORALIFE trademark. Floralife has
advertised its products extensively and its name is widely
recognized among florists and consumers of floral supplies.
From 1978 to 1983, its sales have been in the range of three to
five million dollars annually. Its leading product is a
preservative used to prolong the life and beauty of cut
Floralife is the owner of three registered trademarks employing
the FLORALIFE name. U.S. Trademark Registration No. 398,694 was
issued to Amling Company in 1942 for the word FLORALIFE
rendered in special form as applied to the preservative
product. Registration No. 366,178 comprises the mark FLORALIFE
& DESIGN and includes the words "Helps Flowers Live Longer."
Registration No. 1,181,726 consists of the mark FLORALIFE and
is used for a plastic cellular composition base for making and
holding cut flower arrangements. Each of these registrations
remain in full force and effect.
Prior to 1984, the defendant Floraline International, Inc.
("Floraline") was doing business as a retail florist under the
name Paul Kostoff Flowers, Inc. In April, 1981, the defendant
filed two applications for federal registration, one on the
word mark FLORALINE and the other on the composite mark
FLORALINE & DESIGN. Each application claimed first use of March
7, 1981 for "retail flower store services, with the added
feature of ordering floral gifts at remote booths." Floralife,
Inc. v. Floraline Int'l, Inc., Opposition Nos. 67,107 &
67,108, slip op. at 1-2 (T.T.A.B. Nov. 9, 1984). Floralife
instituted opposition proceedings in the United States Patent
and Trademark Office ("U.S.P.T.O.") against both applications
and the two cases were consolidated for hearing and decision by
the Trademark Trial and Appeal Board ("T.T.A.B.").
Floraline urges that we dismiss or transfer this case under
28 U.S.C. § 1406(a) (1982) for lack of venue. The only issue is
whether Floraline is "doing business" in this district or
Floralife's claim arises here. 28 U.S.C. § 1391(b), (c) (1982).
If either of these elements are established, venue in this
district is proper.
Floraline is a Michigan corporation with its principal place of
business in Dearborn, Michigan. Its business consists of
receiving floral gift orders from consumers and forwarding them
to retail florists located in the vicinity of the gift
recipient. The orders are placed from telephone terminals
located in airports, department stores, and hotels or 24 hours
a day from any telephone by calling a toll-free 800 number.
They are forwarded via America Floral Services, a wire service
with offices in Oklahoma City, Oklahoma. Customarily, they are
charged to a credit card (Visa or Master Charge) of the person
placing the order.
According to the affidavit of Floraline's vice-president,
Albert M. Pedrosi, Floraline has no offices, salesmen,
representatives, or employees in Illinois. Its only Illinois
property consists of four telephone terminals, or at least 4%
out of a total of nearly 100 nationwide. All the Illinois
terminals are located inside Zayre department stores and
contain instructional and promotional materials.*fn1 From
October 24, 1984 (the date the Illinois terminals were
installed) through July 31, 1985, Floraline had sales of
$444.00 resulting from orders placed at Illinois terminals;
this figure represents less than 0.6% of its total sales of
$71,732.00 for that period.*fn2 The amount of orders placed
outside Illinois for delivery by Illinois florists to residents
of this district has not been disclosed by Floraline and may
well be substantially greater. Nor have they disclosed the
volume of orders placed through telephones in Illinois other
than the four Zayre store terminals.
Clearly, Floraline is "doing business" in this district and its
business contacts are "more than minuscule." Tefal, S.A. v.
Products Intern. Co., 529 F.2d 495, 497 (3d Cir. 1976);
Chicago Reader, Inc. v. Metro College Publishing Co.,
495 F. Supp. 441, 443-44 (N.D.Ill. 1980); McDonald's Corp v.
Congdon Die Casting Co., 454 F. Supp. 145, 148 (N.D.Ill. 1978).
While in terms of dollar volume the amount of business may be
rather small, Floraline's commercial activities cannot be
measured solely in terms of completed sales. Each of its
telephone terminals functions as a sort of sales
representative, soliciting orders, promoting Floraline's
services and familiarizing the public with its name. Moreover,
as Floralife points out, Floraline must have contractual
arrangements with Zayre department stores as well as with
retail florists in this area. See Pl.Ex., Affidavit. of
William J. Gigler.
For similar reasons, Floraline's order figures may not
accurately reflect the scope of infringement occurring in this
district. Infringement — the claim which must "arise" here — is
a result of likely confusion in the public mind over the source
of a product or service. Leblanc Corp. v. Selmer, Inc.,
310 F.2d 449, 457 (7th Cir. 1962), cert denied, 373 U.S. 910, 83
S.Ct. 1299, 10 L.Ed.2d 412 (1963). For each individual
who actually uses the defendant's service to make a floral
purchase, many others must pass by and perceive the mark. Some
may stop to read the promotional materials. And with each
passerby, and especially with each "reader," the likelihood of
confusion and the substantiality of the plaintiff's claim
increases. Thus, the confusion likely to occur here may far
exceed actual orders placed from the four phones.
Because the defendant resides in the Eastern District of
Michigan, we have discretion to transfer the case there if
doing so would serve the convenience of parties and witnesses
and the interests of justice. 28 U.S.C. § 1404(a) (1982).
Floraline emphasizes that it is a small, relatively new
corporation while the plaintiff is an established company with
annual sales in the millions. These facts alone do not meet the
defendant's "strong burden" of proving that its home district
is a more appropriate forum. Technical Publishing Co. v.
Mayne, 206 U.S.P.Q. 284, 288 (N.D.Ill. 1979). To transfer this
case would merely shift the burden of litigating in an
out-ofstate forum from the defendant to the plaintiff. Id. In
light of the plaintiff's customary right to choose the forum
and, as we discuss below, Floraline's knowing assumption of the
risks of this litigation, we decline to order a transfer.
III. Preliminary Injunction
The filing of this lawsuit was prompted by an advertisement
appearing June 22, 1985 in Flower News/Grower's Digest, a
national trade weekly for the floral industry. The
advertisement, headlined "Introducing the Industry's First Full
Service Credit Card" and "Attention Wholesale and Retail
Florists," contains the FLORALINE mark and describes the
defendant's services as follows:
During the past year and a half, Floraline has installed nearly
100 remote floral order telemarketing units in airports and
other select locations nationwide. Those orders have been
relayed to individual florists via national wire service
channels. The telemarketing volume now allows Floraline
International to introduce one of the most exciting and
rewarding programs ever to be offered in the industry. First,
Floraline "subscribers" will be the receivers of our
telemarketing floral orders. Second, an order transfer system
will allow subscribers to exchange "wire orders" using the
Floraline Directory. Third and most exciting, each subscriber
will be supplied with a credit card which will allow instant
transfer of funds between Floraline subscribers. The
"Quick-Trans" credit card will also allow subscribers to charge
purchases with wholesalers and manufacturers.
Pl.Ex. 7. Eighteen days after this advertisement appeared,
Floralife filed its complaint and motion for preliminary
relief.*fn3 By its motion, Floralife seeks to preliminarily
enjoin Floraline International (1) from installing any new
telemarketing units in airports and other locations under the
FLORALINE mark; and (2) from soliciting any additional
subscribers for floral industry credit cards containing the
In deciding whether to grant or deny preliminary injunctive
relief, our discretion is guided by four factors:
(1) whether there is an adequate remedy at law (that is,
whether interim harm caused by the activity to be enjoined can
be completely offset by a subsequent ...