S. S. Kresge Co. v. United Factory Outlet, Inc.

• Decision Date: 18 May 1979
• Docket Number: No. 78-1415,78-1415
• Citation: 598 F.2d 694
• Parties: S. S. KRESGE COMPANY, Plaintiff-Appellee, v. UNITED FACTORY OUTLET, INC., et al., Defendants-Appellants.
• Court: U.S. Court of Appeals — First Circuit

Page 694

598 F.2d 694

202 U.S.P.Q. 545

S. S. KRESGE COMPANY, Plaintiff-Appellee, v. UNITED FACTORY OUTLET, INC., et al., Defendants-Appellants.

No. 78-1415.

United States Court of Appeals First Circuit.

Argued Jan. 5, 1979.

Decided May 18, 1979.

Burton Chandler, Worcester, Mass., with whom Meredith Peterson Tufts, and Seder & Seder, Worcester, Mass., were on brief, for defendants-appellants.

Richard W. Renner, Chicago, Ill., with whom Richard E. Alexander, Chicago, Ill., was on brief, for plaintiff-appellee.

Before COFFIN, Chief Judge, CAMPBELL and BOWNES, Circuit Judges.

BOWNES, Circuit Judge.

This is an appeal by defendants-appellants, United Factory Outlet, Inc., et al. (United), from an order of the district court denying a preliminary injunction sought to prevent S. S. Kresge Co. (Kresge), plaintiff-appellee, from using the word "Mart" in any form of advertisement in Worcester County, Massachusetts; making any form of public communication in Worcester County distinguishing appellee's stores from those of appellants; making any form of public comment that the actions of appellants in protecting their right to the use of the name "Mart" will be detrimental to the community; and making any form of public comment as to appellee's plans to expand into Worcester County.

United has operated two retail discount department stores in Worcester County under the name of "The Mart" since 1960. ¹ Kresge, which has operated a national chain of similar stores under the name of "K mart" since 1962, ² announced plans to open two K mart stores in the Worcester area. As a result of repeated assertions by United that it had exclusive use of the term "The Mart" in the area and its threat of legal action, Kresge filed an action in federal district court for a declaratory judgment that it could legally operate stores in Worcester County under the name "K mart."

After filing the lawsuit, Kresge initiated an advertising campaign in the local media announcing that it would like to open a K mart store in the City of Worcester. Several articles appeared in the local press which contained interviews of Kresge employees and dealt with Kresge's anticipated expansion into the area and the potential benefits resulting therefrom in terms of employment in retailing and construction, taxation, etc. The articles also adverted to the pending lawsuit.

In June, 1978, United filed a motion in the pending declaratory judgment action for a preliminary injunction. ³ The district court denied the motion on the basis that the term "mart" is generic and, thus, not subject to protection. Because of the fervor that the parties have evinced in this case, it is appropriate to point out that we are ruling on the question of whether the district court committed a clear error of law in denying the injunction. Appellants bear the heavy burden of convincing us that they had shown below that they probably would prevail on the merits. Automatic Radio Mfg. Co. v. Ford Motor Co., 390 F.2d 113, 115 (1st Cir.), Cert. denied, 391 U.S. 914, 88 S.Ct. 1807, 20 L.Ed.2d 653 (1968).

Trade name law involves rights in the use of symbols or words which serve to distinguish the source of a particular good or service. There are generally recognized four categories of words which, in their ascending order of eligibility for protection, are: (1) generic, (2) descriptive, (3) suggestive, and (4) arbitrary and fanciful. Abercrombie & Fitch v. Hunting World, Inc., 537 F.2d 4, 9 (2d Cir. 1976). Generic terms are those which refer to a genus of which a particular product is a species, without distinguishing its source or origin. ⁴

Generally speaking, generic terms are unprotectible through trademark or trade name registration. Miller Brewing Co. v. G. Heileman Brewing Co., 561 F.2d 75, 79 (7th Cir. 1977), Cert. denied, 434 U.S. 1025, 98 S.Ct. 751, 54 L.Ed.2d 772 (1978); Abercrombie & Fitch, supra, 537 F.2d at 9; CES Publishing Corp. v. St. Regis Publications, Inc., 531 F.2d 11, 13 (2d Cir. 1975). A survey of well-known dictionaries reveals that the term "mart" is generic since it is another word for store or market. ⁵ We recognize appellants' point regarding the shifts in meaning which occur with many terms in our language over a period of time and through usage, but such a shift has not yet occurred with respect to "mart." Appellants describe the term "mart" as quaint and not generally used in common parlance. The question, however, is not whether a term is more frequently chosen colloquially than any of its synonyms, but whether it still retains its generic meaning. Appellants have made no showing that the term in this case has any meaning in the minds of the consuming public other than store or market. Blisscraft of Hollywood v. United Plastics Co., 294 F.2d 694, 699 (2d Cir. 1961). The record, in fact, reveals that the term is commonly used as a substitute for store or market as evidenced by over thirty federally registered trade names and trademarks which include the word mart. (E. g., G-Mart, Mammoth Mart, Mini-Mart, Q Mart, Medi Mart, Valu-Mart, etc.) Leaving aside any trademark or trade name registration considerations, it has long been settled that at common law generic terms could not become valid trademarks. Delaware Hudson Canal Co. v. Clark, 13 Wall. 311, 80 U.S. 311, 323, 20 L.Ed. 581 (1871); Abercrombie & Fitch, supra, 537 F.2d at 9.

Appellants contend that, even if the word "mart" is generic, they are still entitled to protection under the law of unfair competition. The cases cited for this proposition stand for the well established rule that courts will protect descriptive or geographic terms which have acquired a secondary meaning. Southwestern Bell Co. v. Nationwide Independent Directory Service, Inc., 371 F.Supp. 900, 909 (W.Ark.1974) (on the use of the term "Yellow Pages"); Atlantic Monthly Co. v. Frederick Unger Publishing Co., 197 F.Supp. 524 (S.D.N.Y.1961) (on the use of the term "Atlantic"); Abercrombie & Fitch, supra (on the use of the term "safari" to describe certain clothing styles). This doctrine of secondary meaning, however, has rarely been extended to a generic term used generically. In Coca-Cola Co. v. Snow Crest Beverages, 162 F.2d 280, 283 (1st Cir. 1947), in refusing to extend protection to the word "Cola" and upholding the right to use the name "Polar Cola," we said: "It has been held that the word is generic and therefore may be used in the name of a cola drink by any one who chooses to make such a beverage." The same reasoning would seem to apply here. Secondary meaning does not usually attach to the words "The Mart" any more than to the words "The Market" or "The Store," although when "mart" is used in conjunction with other words or symbols it may become descriptive and may acquire a secondary meaning. We are aware of the language in Food Fair Stores, Inc. v. Food Fair, Inc., 177 F.2d 177, 185 (1st Cir. 1945), suggesting that generic terms used in combination can acquire a secondary trade name meaning, but, in that case, both parties were vying for the exclusive right to use the identical words. Moreover, we are here ruling only on the question of probability of success on the merits; we are not definitively deciding the ultimate issue.

Nor is it clear how Kresge's attempt to open a store in Worcester would constitute unfair competition. The record does not compel a conclusion that Kresge's advertisement or the news article were an attempt to confuse the public into thinking that its stores or products are in any way related to United's stores. In fact, it seems that Kresge's advertisement has the opposite goal, distinguishing itself from any other stores operating in the area. ⁶

Appellants also argue ⁷ that they are entitled to protection under the Massachusetts anti-dilution statute, Mass.Gen. Laws Ann., ch. 110B, § 12, which provides:

Likelihood of injury to business reputation or of dilution of the distinctive quality of a mark registered under this chapter, or a mark valid at common law, or a trade name valid at common law, shall be a ground for injunctive relief notwithstanding the absence of competition between the parties or the absence of confusion as to the source of goods or services.

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