Citigroup Inc. v. City Holding Co.
| Decision Date | 30 October 2001 |
| Docket Number | No. 99 CIV. 10115(RWS).,99 CIV. 10115(RWS). |
| Citation | 171 F.Supp.2d 333 |
| Parties | CITIGROUP INC. and CITICORP., Plaintiffs, v. CITY HOLDING COMPANY and City National Bank Of West Virginia, Defendants. |
| Court | U.S. District Court — Southern District of New York |
Skadden, Arps, Slate, Meagher & Flom by Kenneth A. Plevan, Esq., Stephanie J. Kamerow, Esq., New York City, for Plaintiffs.
Baker Botts by Russell H. Falconer, Esq., Steven R. Gustavson, Esq., New York City, for Defendants.
Plaintiffs Citigroup Inc. and Citicorp (collectively "Citicorp"), have moved for summary judgment under Rule 56, Fed. R.Civ.P. on their affirmative claims of trademark infringement, dilution and unfair competition and to dismiss the counterclaims of defendants City Holding Company ("City Holding") and City National Bank of West Virginia ("City National") (collectively "City Holding") which assert similar claims against Citicorp.
For the reasons set forth below, the Citicorp motion for judgment on its claims is denied, its federal and New York dilution claims are dismissed, and its motion to dismiss the counterclaims of City Holding and City National is granted.
This action presents the contest between aurally identical marks employed by one of the primary financial institutions in the nation and by a West Virginia bank that has had regional and national aspirations. Competing causes of action for trademark infringement, dilution and unfair competition have been presented.
The resolution of these issues turns upon the effect of I/Y distinction between CITI and CITY, the significance of the feud between two families of marks, and the significance of the size of the marks. These issues will be resolved in the usual context of the factors established by our circuit in Polaroid Corp. v. Polarad Electronics Corp., 287 F.2d 492 (2d Cir.1961) ("Polaroid").
Able counsel for both sides have carefully illuminated the issues and substantially assisted the court.
Parallel actions were commenced in 1999. Citicorp filed its complaint in this Court in New York on September 29, 1999, and City Holding filed its action in the United States District Court for the Southern District of West Virginia, Charleston Division, on November 5, 1999. This Court in an opinion of June 2, 2000 (the "Opinion"), Citigroup Inc. v. City Holding Company, 97 F.Supp.2d 549 (S.D.N.Y. 2000), denied City Holding's motion to dismiss for lack of jurisdiction and its motion to transfer the action to the West Virginia District Court and enjoined City Holding from prosecuting its action there. Familiarity with the Opinion is presumed.
Discovery proceeded without difficulty and the instant motion was heard and marked fully submitted on June 27, 2001.
The facts are found based upon the Local Rule 56.1 Statements of the parties with inferences drawn in favor of City Holding, the non-moving party.1
On January 19, 1960, Citibank, a predecessor of Citicorp and Citigroup, registered the mark CITIBANK with the United States Patent and Trademark Office ("PTO"). Citicorp federally registered THE CITI NEVER SLEEPS shortly after February 1978.
As of December 31, 1980, Citicorp had federally registered the following marks: CITIBANK, CITICARD, CITICORP, CITIDATE, CITIPHONE, CITIPLAN, CITIQUOTE, CITISHARE and THE CITI NEVER SLEEPS, as well as 19 others. Citicorp federally registered the mark CITI on December 8, 1981.
By the end of 1985, there were approximately 60 federally registered CITI-prefixed marks. These included the following marks not registered as of December 31, 1980: CITI, CITI TREASURY MANAGER, CITI$HOPPER, CITIDOLLARS, CITIFILE, CITIFLEX, CITILEASE, CITISAVINGS, and CITITREND. By December 31, 1990, CITI's family of approximately 60 registered marks also included the following: CITIBANK PREFERRED, CITICORP TRAVELERS CHECKS, CITIEXPRESS, CITISPAN and CITISTAR. As of year-end 2000, there were approximately 140 marks either registered or covered in a pending federal trademark application in the CITI family of marks.
Citicorp has used slogans featuring the CITI mark, including "The CITI Never Sleeps" (1978), "The CITI of Tomorrow" (1981), "The CITI at Your Front Door" (1981), "It's your CITI" (1984), and "The CITI of Your Dreams" (1995). The CITI mark is also used in vanity phone numbers, including 1-800-321-CITI, 1-800-441-CITI, 1-800-336-CITI, 1-800-328-CITI, 1-800-967-CITI, 1-800-835-CITI, and 1-800-CITIGOLD. The number 1-800-CITI-ATM was used in the 1980's.
In November and December of 1998, focus group testing was done for Citicorp in Ohio, Texas and South Carolina in order to assess the public's reaction to proposed names to replace the Commercial Credit Corporation, a consumer finance subsidiary that had been a Travelers company. The survey company concluded that of the six names tested, CITIFINANCE and CITIFINANCIAL held the greatest potential.
A search report was ordered on December 22, 1998, with respect to CITIFINANCE/CITIFINANCIAL which revealed City Holding's CITI FINANCIAL CORP and CITY FINANCIAL CENTER marks, along with 18 pages of listings of "City Finance" companies. Both names were cleared. On January 15, 1999, Citibank filed an application to register the CITIFINANCIAL mark, stating under oath that there were no other parties with the right to use that mark.
On January 15, 1999, Citibank filed an application to register the CITIFINANCIAL mark, attesting that there were no other parties with the right to use that mark.
On April 3, 2000, the name of the Citicorp Mortgage, Inc. subsidiary was changed to CITIMORTGAGE.
City National Bank of Charleston was chartered in West Virginia in 1957 and used the CITY NATIONAL BANK mark throughout the 1960's, '70's and '80's. City Holding Company became the bank's corporate parent in 1983, after which substantial in-state expansion was effected through the acquisition of other banks, and by the building of City National Banks, between 1983 and 1997, with almost 60 branches.
In 1993, City Bank adopted the mark CITY FINANCIAL CORP, followed later that year by CITY MORTGAGE CORP. In 1996 CITY MORTGAGE SERVICES used the CITY HOME LENDING and CITY LENDING SERVICES names in the late 1990's.
In the mid 1990's, City Holding began to develop a nationwide mortgage service and origination business. In July 1996, City National established a "City Mortgage Services" division in California. This was followed by the acquisition of several West Coast banks and mortgage companies, and the establishment of a mortgage office in Dallas.
Beginning in July 1997, City Holding filed federal trademark applications for the following eight CITY marks: CITY CREDIT SERVICES; CITY FINANCIAL CORP; CITY HOLDING COMPANY; CITY MORTGAGE CORP; CITY MORTGAGE SERVICES; CITY NATIONAL BANK; CITY CAPITAL RESOURCES; and CITY FINANCIAL CENTER. In each of these applications, City Holding disclaimed any rights with respect to the non-CITY component of the marks.
In the late 1960's and early 1970's, Citicorp established Citicorp Venture Capital and Citicorp Leasing, two financial service businesses that operated nationally. In 1979, Citicorp founded Citicorp Mortgage, headquartered in St. Louis, Missouri, and by the late 1980's Citicorp Mortgage was one of the country's top issuers of new first mortgages. Other Citicorp businesses with offices or customers across the country included Citicorp Industrial Credit Corp., Citicorp Capital Investors Ltd., and Citicorp Business Credit, Inc. As of 1984, for example, approximately 11.7 million domestic households, or one out of every seven, was a Citicorp/Citibank customer. Citicorp had business relations with more than 17 million domestic households.
During the 1970's, Citicorp became the largest United States banking corporation in terms of loans and the largest nongovernmental bank worldwide with 850 offices in close to 90 countries. By 1972 Citicorp's assets exceeded $30 billion.
In 1984, Citibank and Citicorp had customers in every one of the 50 states, and relationships with 11.7 million domestic households, or one out of every seven households in the country. In 1990, Citicorp had business relationships with more than 17 million domestic households, and by 1997, Citicorp had customers in over 22 million U.S. households.
Advertising and marketing expenditures in the U.S. of Citibank products for the years 1994-2000 were as follows:
1994 $ 381 million
1995 $ 394 million
1996 $ 331 million
1997 $ 353 million
1998 $ 660 million
1999 $ 715 million
2000 $ 603 million
During the years 1974-84, Citicorp spent over $100 million on advertising CITI brand services throughout the United States.
Citicorp's revenue has been as follows:
1980 $ 3.7 billion
1985 $ 8.5 billion
1990 $ 14.6 billion
1995 $ 18.7 billion
1997 $ 21.6 billion
In terms of consumers, the approximate number of U.S. households which utilized Citicorp services in selected years was as follows:
Total Credit Card Retail2
1980 4.3 million 3.6 million 645,430
1985 8.9 million 7.7 million 980,497
1990 17.5 million 15.5 million 1.7 million
1995 20.5 million 18.2 million 1.6 million
1997 22.8 million 20.1 million 1.9 million
As shown by a 1996 Corporate Image Study, 89% of U.S. consumers have heard of Citibank. The same study shows that 51% of the public is familiar with the services provided by Citibank.
Citigroup has received extensive unsolicited media coverage for decades, including hundreds of articles appearing in mass circulation, newspapers, magazines and electronic media, including national publications as The New York Times, the Wall Street Journal, Fortune and Forbes, some of which news stories have referred to Citigroup and/or its predecessors as simply "CITI."
As part of its nationwide business activities, Citibank has offered financial services in West Virginia...
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