Opinion
No. 4130.
August 9, 1944.
Whittemore, Hulbert Belknap, of Detroit, Mich., for plaintiff.
Arthur Rubin, of Detroit, Mich., for defendant.
Action by Coca-Cola Company against Alex Belinsky, individually and doing business as Igloo Syrup Company, for infringement of plaintiff's trade-mark and for unfair competition.
Judgment for plaintiff.
Findings of Fact
1. This is an action brought for infringement of the plaintiff's trade mark and for unfair competition. In accordance with the practice of this court the parties were requested to furnish the court with proposed findings of fact and conclusions of law. The plaintiff has established all of the facts submitted in its proposed findings and these proposed findings are filed as a part of the file of this case. At the conclusion of the hearing and at the time the decision of the court was announced an informal opinion was dictated into the record, which is printed herewith following the formal conclusions of law. These findings will summarize all of the findings that are necessary to a decision. Most of the findings are based upon admissions made at a pre-trial hearing at which a formal order was entered.
2. The plaintiff is a Delaware corporation and a citizen of that state. The defendant is a citizen of the state of Michigan and a resident of this district. The plaintiff is engaged in the manufacture and sale of a soft drink syrup and beverage made therefrom under the trade mark of Coca-Cola. For a great many years the plaintiff and its predecessors have continually used this trade mark in interstate commerce and plaintiff is now using this trade mark throughout the United States. Coca-Cola designates the origin of the plaintiff's product and is recognized by the public as indicating exclusively the goods of the plaintiff. Plaintiff and its predecessors have spent large sums of money in advertising its product under its trade mark and have established a good will which has a value greatly in excess of $3,000.
3. Soft drinks are usually ordered by spoken word and the public frequently abbreviates the name of the plaintiff's product to "Coke" and a call for "Coke" is understood by the public and dealers to be a call for the plaintiff's product.
4. The plaintiff's product is artificially colored a reddish brown and it is impossible for a purchaser to ascertain merely from inspection whether the product is plaintiff's product or an imitation where the color and consistency of the product are similar.
5. The defendant since approximately 1942 has been engaged in selling soda fountain syrups at wholesale directly and through jobbers. Prior to engaging in this business he had many years' experience in the handling of plaintiff's product and had sold substantial quantities of it. In 1942, the defendant started to manufacture and sell in interstate commerce a beverage syrup to which he applied the name Polo-Kola. The product which he sold under the name of Polo-Kola is merchandise of the same descriptive qualities as the plaintiff's Coca-Cola and reached the consuming public in substantially the same manner as the goods of the plaintiff are distributed. The evidence in this case conclusively establishes that from the beginning the defendant intended to palm off his product as the product of the plaintiff. Prior to the time that the defendant started out on his venture of manufacturing he was a witness for the plaintiff in a suit similar to this. He was called as a witness in this case and it is perfectly clear from the evidence that when he adopted the color for his product and selected the name he did so with the deliberate intention of deceiving the ultimate purchasers into believing that they were purchasing and receiving the plaintiff's product. Shortly after the defendant started to manufacture this product without license or authorization from the plaintiff, the plaintiff notified the defendant in writing of the claimed infringement and requested that he discontinue using the name Polo-Kola. The defendant did not comply with this request. When called as a witness he offered no plausible excuse for adopting the name that he did or for coloring the syrup in imitation of the plaintiff's product and offered no explanation for his attempts to palm off his product as that of the plaintiff. He is guilty of trade mark infringement and unfair competition.
Conclusions of Law
1. This action arises under the trade-mark laws of the United States, 15 U.S.C.A. § 81 et seq., and is between citizens of different states, wherein the amount involved is in excess of Three Thousand ($3,000) Dollars, exclusive of interest and costs, and this court has jurisdiction. 28 U.S.C.A. § 41(7).
2. The defendant was guilty of trade-mark infringement and unfair competition in that he deliberately marketed his product with the intention that it should be passed off as the product of the plaintiff. A judgment may be entered perpetually enjoining and restraining the defendant from:
(a) using, upon or in connection with the manufacture, sale, distribution, bottling, advertising or offering for sale of any beverage syrup, concentrate, extract, or beverage made therefrom, the words "Polo-Kola" or any other colorable imitation of plaintiff's trade mark "Coca-Cola" and from otherwise infringing plaintiff's said trade mark;
(b) selling, or delivering, in response to calls or orders for "Coca-Cola" or "Coke", any product other than plaintiff's;
(c) giving to any part of the merchandise sold by defendant, his agents or distributors, a color imitating or resembling the color of the plaintiff's product unless such product reaches the ultimate consumer in a distinctive package and unless the same be sold under a name not confusingly similar to the trade mark "Coca-Cola" or any part thereof.
The judgment shall further provide that the defendant shall deliver up to plaintiff for destruction any material having thereon the name Polo-Kola and he shall at once cancel the registration of the name Polo-Kola. Plaintiff may recover its costs to be taxed.
I think the reason we took so much time in trying this case is because we overlooked the fact that once it is established by competent evidence that it was defendant's intention to deceive the public and palm off his goods as those of another, everything that he did thereafter in carrying out that unlawful design became unlawful.
This case is not entirely unlike the Mishawaka case (Mishawaka Rubber Woolen Mfg. Co. v. S.S. Kresge Co., 6 Cir., 119 F.2d 316, certiorari granted, 314 U.S. 603, 62 S.Ct. 183, 86 L.Ed. 485, reversed in part, 316 U.S. 203, 62 S.Ct. 1022, 86 L.Ed. 1381), which is comparatively fresh in my memory. There can't be any question but that the defendant intended to deceive the public in what the public was getting. It may be his product was a great deal superior to Coca-Cola. If it was, he should have marketed it in a manner that would give himself the benefit of that superior product.
In this day and age with the difficulty that the average purchaser has in determining whether he is getting a genuine product or an imitation, certainly a court of equity should keep up with the legislative bodies, the Congress and the State Legislature. Congress has in recent years adopted, as you know, a great many acts tending to protect the ultimate consumer in his right to get that which he ordered and for which he paid. No longer is it possible for the clever manipulator to sell a man a garment claiming that it is wool when it is something else. He can't even claim that it is virgin or new wool when it is re-used wool. If you look at the labels that are on articles that have come through Interstate Commerce you will find they each carry a label stating exactly the makeup of the product.
There is no particular reason why the purchasers of goods that are protected by the inherent powers of a court of equity should not be given the same consideration as the purchasers of goods covered by these various legislative acts.
Our system of economy is built upon a basis of free enterprise, free competition. You cannot have free enterprise and you cannot have free competition unless everybody is playing the game by the same rules. Obviously, you couldn't have a golf match that would mean anything when you got through if one of the competitors was permitted to tee up in the traps, and on the fairway, and in the rough, and the other was required to play golf according to the rules.
When you get all through with it, all there is to an action for unfair competition is an action to tell the defendant that if he is going to play the game he will have to play it according to the rules.
The evidence here is more than ample. It is clear and convincing that the defendant started out with the deliberate intention of marketing his product through the assistance and under the guise of being a product that was a substitute for Coca-Cola, and then he neglected to see that the ultimate consumer would always be advised that he was getting a substitute.
There can't be any excuse for copying a color unless he intended to deceive somebody. There is nothing particularly enticing about the color of Coca-Cola, as I see it. I know that lemonade is just as attractive. I don't know but what pink lemonade is just as attractive. There are a lot of other names that could be used.
What I have said here is just in general terms, and I will take the time to write out my findings a little bit more in detail. I think I am going to adopt all of the findings that the plaintiff has asked for, with some explanatory matter added.
Now, the plaintiff is entitled to an accounting. That accounting should move along promptly. It has been my experience that if you do not get an accounting promptly it drags along indefinitely. I have never made a reference to a Special Master; I don't intend to in this case. I have found that if you handle the matters promptly you can get an accounting through relatively simply.
So, I will ask you, Mr. Beaumont, to prepare a decree in accordance with the prayers in your complaint and present it for signature Monday at 2 p.m.