Chas. D. Briddell, Inc. v. Alglobe Trading Corp., 144

CourtUnited States Courts of Appeals. United States Court of Appeals (2nd Circuit)
Citation194 F.2d 416
Docket NumberNo. 144,Docket 22217.,144
PartiesCHAS. D. BRIDDELL, Inc. v. ALGLOBE TRADING CORP. et al.
Decision Date21 January 1952

COPYRIGHT MATERIAL OMITTED

Fennelly, Eagan, Nager & Lage, New York City (Charles J. Nager and Seymour Stein, New York City, of counsel), for plaintiff-appellee.

Maurice V. Seligson and Asher Blum, all of New York City (Mock & Blum, New York City, of counsel), for defendants-appellants.

Before CHASE, CLARK and FRANK, Circuit Judges.

FRANK, Circuit Judge.

From our examination of the knives and containers, and the other exhibits, we think there is, to say the least, considerable doubt whether, on this record, there was marked creativeness in the appearance of plaintiff's knives (made in the well-known form of a hunting knife) or of the containers, or in putting such knives in such containers. But we shall assume, arguendo, that the plaintiff's design was unquestionably unique and the result of genius. Even on that assumption, we think that, without more, plaintiff was not entitled to a preliminary injunction. Our reasons follow:

In the first place, we regard the following as well settled.1 The fact that the design of an article is strikingly novel and beautiful, and the fact that its first producer has spent large sums in advertising which has made the article popular with consumers, give that first producer no rights against others who subsequently imitate it and (taking advantage of the consumer-popularity of the article, due to the first producer's advertising) sell it competitively — unless the first producer has a monopoly based upon (1) a patent on the design or (2) a so-called secondary meaning. Absent (1) and (2), the first producer has no legal complaint because the imitators have been enriched by his efforts, have enjoyed what is known as a "free ride." For the common law favors competition; and it is of the essence of competition that competitors copy and undersell the product of an originator. The competitors do not lose their favored common-law position merely because someone chooses to call them "free riders." To have protection from such competition, the originator must possess some sort of monopoly.

In General Time Instrument Corp. v. United States Time Corp., 2 Cir., 165 F.2d 853, at page 855 where plaintiff had sold almost 3,000,000 of its clocks and had spent about $2,000,000 in advertising the same from 1939 to 1946, we said: "This measures plaintiff's efforts to establish a secondary meaning, but does not determine its success. * * * Large expenditures for advertising do not compel a conclusion that the task has been accomplished." We also said: "The copying of an unpatented design does not in itself constitute unfair competition."2

To obtain a valid design patent is exceedingly difficult.3 Probably that explains why plaintiff did not even apply for a patent. Had the statute permitted the procuring of a design copyright and had plaintiff procured one, defendants' conduct in deliberately copying plaintiff's design would have been actionable. But plaintiff has no such copyright. And there is no such thing as a common-law design copyright. That is understandable. For such a copyright, not created under congressional legislation, would be free of the constitutional provision limiting the life of a copyright, and would be a perpetual monopoly.

Accordingly, an injunction could be proper here only if plaintiff showed that it had acquired a "secondary meaning" in the design of its knives, or containers — i.e., showed a likelihood that purchasers of defendants' products would believe that they came from the same source as plaintiff's. (Of course, it would suffice to show such a likelihood; proof of actual instances of confusion is not required.) As this court, per Judge Learned Hand, has said, it "is an absolute condition to any relief whatever that the plaintiff in such cases show that the appearance of his wares has in fact come to mean that some particular person — the plaintiff may not be individually known — makes them, and that the public cares who does make them, and not merely for their appearance and structure. * * * The critical question of fact at the outset always is whether the public is moved in any degree to buy the article because of its source and what are the features by which it distinguishes that source. Unless the plaintiff can answer this question he can take no step forward; no degree of imitation of details is actionable in its absence."4 And this is true, we have said, even if the defendant copies "slavishly"5 or "down to the last detail."6

The record contains nothing but affidavits and exhibits. We are in as good a position as the trial judge to evaluate such evidence.7 We think it does not suffice to establish the essential likelihood of consumer-confusion as to source. Standing alone, deliberate copying of the appearance of plaintiff's product (while omitting plaintiff's trademark, legend and name) does not prove such likelihood. The only significant evidence tending so to prove consists of unsworn statements found in two letters sent to plaintiff.8 For reasons stated above, there is no evidence of consumer-confusion in the affidavit of one Hussey (an experienced manufacturer's representative) that plaintiff's knives had had "a tremendous consumer-reception" and that defendants ("new competitors") were offering a product which they claimed to be and which was similar to plaintiff's at a substantially lower price, with the consequence that jobbers were withholding orders for plaintiff's knives. For this affidavit served to show merely that defendants began actively to compete with the plaintiff, and not at all that consumers were confused or likely to be confused as to source.9 We conclude that the trial judge's findings, so far as they relate to consumer-confusion, have no adequate support in the record, and that, therefore, the preliminary injunction should not have issued.10 Of course, we do not prejudge the case as it may develop in a trial on the merits.

We have no occasion to consider whether the Lanham Act, 15 U.S.C.A. § 1126(h, i) applies here. This circuit has not yet decided whether that Act creates a new federal right against "unfair competition." See Cutting Room Appliance Corp. v. Empire Cutting M. Co., 2 Cir., 186 F.2d 997.11 But even if we assume, arguendo, that the Act does apply, we think that it cannot affect our conclusion: Under the Act, the likelihood of consumer-confusion remains, just as theretofore, the test of secondary meaning. S. C. Johnson & Son v. Johnson, 2 Cir., 175 F.2d 176, 180. And we believe that the Act does not enlarge the common-law meaning of "unfair competition" so as to give rise to a secondary-meaning right where the likelihood of consumer-confusion is not proved. "Unfair competition" are words of art; and, when the legislature borrows such words, they are deemed to retain their previous meaning unless there is a contrary legislative intention clearly expressed in the statute or its history. See Hoffman v. Palmer, 2 Cir., 129 F.2d 976, 983; Case v. Los Angeles Lumber Co., 308 U.S. 106, 115, 60 S.Ct. 84 L.Ed. 110; Keck v. United States, 172 U.S. 434, 446, 19 S.Ct. 254, 43 L.Ed. 505; United States v. Wong Kim Ark, 169 U.S. 649, 18 S.Ct. 456, 42 L.Ed. 890; Morissette v. United States, 72 S.Ct. 240.

Reversed.

CLARK, Circuit Judge (dissenting).

The opinion herewith appears to go on grounds of both substance and procedure. If, and as, it is a ruling that the rather drastic remedy — under the circumstances here — of an injunction should issue only upon more "live" testimony than is here, I should be disposed to go along, provided a speedy hearing was directed and adequate safeguards were required meanwhile to hold the matter in statu quo. For it must be borne in mind that the evidence, whatever it was, stood unchallenged on the issue here crucial1 except for our own judicial notice of the subject of cutlery and it was sufficient to convince an experienced and cautious trial judge. It should not therefore be disregarded while we are searching for a more complete case — particularly when we are faced with the deliberate copying of a widely advertised product, to sell a depreciated article at half price. The absence, however, of any suggestions for such interim safeguards,2 the substitution of upper for lower court findings, and the objections to any possibility of distinctive design in cutlery, indeed the strong skepticism expressed as to any secondary meaning notwithstanding the record, force me to conclude that no "likelihood of confusion" — the governing requirement — will ever be accepted as possible unless a strong showing of actual confusion from the persons confused is made. That means that even the rawest copying will not be actionable. And that is new law, as the cases cited in the opinion show.

I wish I could be as certain as my brethren that a green light to "free-riders" is of the essence of a competitive society and that we have a duty to carry out this high public policy. But, as my opinions show, I am bothered by troublesome doubts. Much of modern advertising offends my sensibilities; on the other hand I cannot develop enthusiasm for the manufacturer who would rely on the advertising of others to market a poorer product, even at lesser price. Placed in such dilemma, I would like to yield my views of public policy to those closer to both producers and consumers than I. I have thought to see such possible definitive instruction in the Lanham Trade-Mark Act of 1946, in its emphasis upon remedies against use of copies of trade-marked articles "likely to cause confusion or mistake," 15 U.S.C.A. § 1114, or use as to "any goods or services * * * a false designation of origin, or any false description or representation," 15 U.S.C.A. § 1125(a), or even more broadly "effective protection against unfair competition." 15...

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