GB Kent & Sons v. P. Lorillard Co.

• Decision Date: 11 August 1953
• Docket Number: Civ. No. 80-296.
• Citation: 114 F. Supp. 621
• Parties: G. B. KENT & SONS, LIMITED, v. P. LORILLARD CO.
• Court: U.S. District Court — Southern District of New York

114 F. Supp. 621

G. B. KENT & SONS, LIMITED, v. P. LORILLARD CO.

Civ. No. 80-296.

United States District Court S. D. New York.

August 11, 1953.

COPYRIGHT MATERIAL OMITTED

Lewis & Mound, New York City, Milton N. Mound, Richard Wincor and Herbert F. Schmelzer, New York City, of counsel, for plaintiff.

Campbell, Brumbaugh, Free & Graves, New York City, Walter H. Free, Thomas L. Perkins, Robert McCormack and James N. Buckner, New York City, of counsel, for defendant.

WEINFELD, District Judge.

G. B. Kent & Sons, Ltd., an English concern, brings this action against P. Lorillard Company, a New Jersey corporation, alleging trademark infringement and unfair competition. Plaintiff seeks to enjoin the defendant from using the name "Kent" in connection with the sale and distribution of cigarettes and from using white and gold coloring with the design of a castle on packages or containers of cigarettes. The defendant counterclaims for a declaratory judgment that plaintiff has no title to "Kent" as a name for cigarettes or other tobacco products, that defendant's use of "Kent" does not infringe any of plaintiff's trademark rights, and that defendant's sale of cigarettes under the name of "Kent" is not likely to mislead the public into believing that the Kent cigarette is manufactured and sold by the plaintiff.

Both sides move for summary judgment pursuant to Rule 56 of the Federal Rules of Civil Procedure, 28 U.S.C.A. The motions are based upon the pleadings, affidavits, extensive depositions taken before trial of various principal representatives of the litigants, and many exhibits. The parties are in agreement that no dispute exists as to the controlling facts and that the matter is ripe for summary judgment. In their joint desire to secure a determination under Rule 56, they advised the Court that if any triable issue of fact should be found, they were prepared to stipulate with respect thereto. Subsequently, upon the Court's drawing to their attention possible issues of fact, they entered into a stipulation which will be referred to in more detail later on.

Plaintiff was incorporated in 1900. It is the successor to the "House of Kent" founded in England in 1777 by William Kent and continued thereafter through five generations of his male heirs.¹ It is from this family name that the trademark rights in "Kent" are derived. Plaintiff's primary business has always been the making and selling of the highest quality combs and brushes (including hair, shaving, tooth, nail, and paint brushes), although at various periods it has sold other products.² Plaintiff's merchandise has been sold under its trademark in every civilized country of the world—as its managing director put it, from "Aden to Zanzibar." In the United States, its products are sold to Cosby Brush and Import Co., Inc. (hereafter called "Cosby"), a New York corporation; Cosby in turn sells to various retail outlets.

Since 1777 in England and 1878 in the United States, plaintiff has used the trademark "Kent" upon its products. In 1931, a subsidiary of plaintiff obtained a certificate of registration of its mark, "Kent", for various brushes.³ In February, 1951, the registration was renewed to plaintiff.

Unquestionably plaintiff has attained a world-wide reputation in the field of brushes; it has built up a substantial good will in the name "Kent" and has imbued it with a secondary meaning as to the products plaintiff manufactures. The high quality of its merchandise is attested to by many prizes and awards at trade expositions and by warrant issued by the royal family of England. However, plaintiff has catered to a luxury group of customers and in consequence the distribution of its product has been limited. Its sales policy has been away from mass distribution concepts. To avoid the impairment of its reputation it has restricted the retail outlets, in which its products are sold, to those of the "highest class".

Plaintiff's advertising campaigns though steady through the years have involved modest expenditures. Thus, from 1947 to 1952, the sums spent on all advertising, including that spent by its customers for cooperative advertising, was $250,000, an average of less than $50,000 per year. To this might be added the value of display advertising in various stores which sell plaintiff's products.

Since 1950 the average dollar volume on sales in the United States "has exceeded" $750,000 annually. More precise figures of sales in the United States have not been submitted.

The name "Kent" is stamped on each item sold by the plaintiff. Most of plaintiff's products are packaged in distinctive designs and colors—among which are boxes colored with broad vertical gold and white stripes bearing the design of a castle or crown. The plaintiff charges that the defendant has not only misappropriated its trademark, but also has simulated this design.

Defendant, P. Lorillard Company, whose business was established in 1760, is the manufacturer of brand name cigarettes including "Old Gold" and "Embassy" and other tobacco products. The Kent cigarette was not marketed by the defendant until March, 1952. Prior thereto, from May to October, 1950, the defendant was engaged in developing a new filter type cigarette.

During the process of development, Robert M. Ganger, then Executive Vice-President of the defendant, with considerable advertising agency experience, selected the name "Kent" for the new filter cigarette. The various factors which led to the choice of name are discussed hereafter, but one reason was to honor Herbert A. Kent, then President of the defendant and soon to retire after more than 25 years association with the defendant. At the time, October 1950, neither Kent nor defendant's advertising director, Alden James, were consulted by Ganger. The naming of the cigarette in honor of Kent was intended as a surprise to him and the proposed use of his name was not to be divulged nor his consent requested until it was clear that the name "Kent" on cigarettes would not be violative of the rights of third parties. Also, in October of 1950, when it was concluded that the new filter cigarette was desirable for marketing, counsel for the defendant were asked to investigate the availability of the trademark "Kent". After investigation, they concluded that only one registered trademark, "Kentwood", issued for tobacco, offered possible conflict with "Kent" on cigarettes, and after protracted negotiations the defendant purchased an assignment of it.

Early in 1951 after counsel had concluded that the name was available, Herbert Kent was asked to give his consent to the use of his name, and in June, 1951, James was told of the decision. It appears that both Kent and James, unlike Ganger, knew of plaintiff's use of "Kent" on its brushes, but each felt that the yet unmarketed cigarette was so dissimilar from plaintiff's products that there was no possibility of confusion—a view which, of course, had the concurrence of defendant's counsel.

On March 26, 1952, the "Kent" cigarette was formally introduced to the public. The initial sales were launched with double page advertisements in the major newspapers in New York City, Chicago, and Los Angeles. An intensive newspaper campaign followed in other cities. Later, television programs were also included in the promotional program. Total advertisement expenditures during 1952 for the new cigarette amounted to approximately $1,550,000 and the sale of Kent cigarettes has been in the hundreds of millions.

Prior to the large-scale launching of the cigarette, the defendant in January, 1952, had sold nominal quantities in interstate commerce under the name of "Kent" and filed an application for its registration as a trade-mark for cigarettes in the United States Patent Office, which was refused "for the reason that the word `Kent' which comprised the mark is primarily a surname."⁴ After the defendant had undertaken its large-scale selling and promotional program and had made distribution of the cigarette in thirty-four states and the District of Columbia, it filed affidavits setting forth the facts and requested registration under Section 2(f) of the Lanham Act upon the ground that "Kent" had become distinctive of defendant's cigarette.⁵ Thereafter, in April, 1953, registration of "Kent" as a trademark for cigarettes was approved and a certificate of registration duly issued by the Patent Office to the defendant.

Plaintiff claims that it first learned of Kent cigarettes in October, 1952, when its managing director arrived in the United States on a business trip. Shortly thereafter, on October 31, 1952, a little over seven months subsequent to the formal introduction of the cigarette, the defendant was notified of the plaintiff's claim of infringement. On November 11, 1952, after a discussion between counsel for both parties which proved abortive, plaintiff commenced this action.

Jurisdiction is based upon the Lanham Act⁶ and diversity of citizenship⁷ with pendent jurisdiction upon the claim of unfair competition.⁸ I need not discuss which law, State or Federal, is applicable to this case, for the Court of Appeals for this circuit has recently said that "* * * the state law is not at odds with our own cases * * *."⁹

Defendant's basic argument in reply to plaintiff's claim of infringement and unfair competition is that the products are so dissimilar and remote they are not in competition and that there is no likelihood of confusion. Plaintiff urges to the contrary that there is likelihood of confusion and contends that even if there were none, it is still entitled to legal protection of its interest in preventing "dilution" of its trademark "Kent".¹⁰

Plaintiff's right to injunctive relief under the Lanham Act¹¹ depends upon a finding that the defendant's use of "Kent" on cigarettes "* * * is likely to cause confusion or mistake or deceive purchasers as to the source of origin of such goods * * *."¹² The fact that the products are...