Brooks Bros. v. Brooks Clothing of California

• Decision Date: 05 May 1945
• Docket Number: Civil Action No. 3580-Y.
• Citation: 60 F. Supp. 442
• Parties: BROOKS BROS. v. BROOKS CLOTHING OF CALIFORNIA, Limited.
• Court: U.S. District Court — Southern District of California

60 F. Supp. 442

BROOKS BROS. v. BROOKS CLOTHING OF CALIFORNIA, Limited.

Civil Action No. 3580-Y.

District Court, S. D. California, Central Division.

May 5, 1945.

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COPYRIGHT MATERIAL OMITTED

Beekman Aitken, of New York City, and Frank M. Benedict, of Los Angeles, Cal., for plaintiff.

Harry G. Sadicoff and Pacht, Pelton, Warne, Ross & Bernhard, by Isaac Pacht and Clore Warne, all of Los Angeles, Cal., for defendant.

YANKWICH, District Judge.

I.

The Background of the Controversy.

The action, filed on April 24, 1944, was for trademark infringement and unfair competition. The plaintiff Brooks Brothers, is a corporation with its principal place of business in the City of New York. The defendant, Brooks Clothing of California, Ltd., is a corporation organized under the laws of California, with its principal place of business in the City of Los Angeles, California. Both are engaged in the sale of clothing and articles of wearing apparel. The business of the plaintiff is confined chiefly to men's trade, although it sold yard goods to women and some of its articles of apparel, such as boy's sweaters, were in demand by women. The defendant, at the present time, operates fifteen stores in various cities in the State of California. While its chief business is clothing and haberdashery for men, in seven of its stores it sells articles of women's apparel. The plaintiff lays claim to the title of the oldest clothier in the United States. The business it conducts had its beginning in 1818. It was originally conducted by one or more members of the Brooks family in a succession of titles, Henry S. Brooks, Henry S. Brooks & Son, Henry Brooks & Co., H. and D. H. Brooks & Co., and later by the partnership of Brooks Brothers. Finally came the corporation known as Brooks Brothers, the successor of these various individual businesses, incorporated under the laws of the State of New York, on January 12, 1903. The partnership, which existed from 1850 until the organization of the corporation, used the words "Brooks Brothers" as a trade-name and mark. The plaintiff has engaged in interstate commerce for many years. As early as 1850, it advertised goods for the California trade. It conducted, at first, sales through the mails, and from the year, 1930, through representatives, who each year called on a selected California clientele, after announcement of the representative's coming was made through personal notice and advertisements in the newspapers. In 1939, it established sales agencies in Los Angeles and San Francisco. During the years 1924 to 1941, inclusive, its total national and mail order sales were $3,288,112. Its road sales throughout the country for the period from 1923 to 1941 amounted to $6,484,100. On December 21, 1914, the plaintiff applied for the registration of its trademark of "Brooks Brothers," under the Trade Mark Act of February 20, 1905.¹ The certificate was issued on April 20, 1915, and was renewed in 1935.

In this action, the plaintiff charges the defendant with infringing its trademark and with being guilty of unfair competition in the use of a mark similar to its own and of simulating labels. It seeks to enjoin the defendants from using the word "Brooks" either as a part of its corporate name, or as a name designating its business, and for damages for both infringement and unfair competition.

The defendant was incorporated on the second day of July, 1930. For some ten years prior to the incorporation, its business was conducted by a partnership consisting of Harry Greenberg, John Greenberg, Emanuel Greenberg and Albert Greenberg, doing business as Brooks Clothing Company. It first registered its fictitious tradename in Los Angeles County on January 29, 1924. On February 7, 1924, the partnership caused the tradename and the use of the word "Brooks" to be registered with the Secretary of State of California under California Laws. On February 17, 1931, the defendant secured federal registration for its trademark "Brooks Clothing Co." After proceedings instituted by the plaintiff, the Patent Office, through its Examiner of Interferences, cancelled the certificate on March 3, 1944. No appeal was taken from the decision, which is now final. Upon the incorporation of the defendant, the partnership business, tradename and mark were transferred to the defendant corporation, which has used it since. At the present time, it conducts fifteen stores, four of which are in the City of Los Angeles and one each in the following California cities: Long Beach, Huntington Park, Glendale, Pasadena, Santa Monica, Pomona, Santa Ana, San Bernardino, San Diego, Santa Barbara and San Jose. It employs at these various places an average of 450 persons, with seasonal increases at various holiday times, and its sales, in the year 1944, amounted to $5,432,215.33. On its store fronts, in its advertising, both newspaper and radio, and in its circulars, the corporate name of the defendant is not used. Instead, the defendant uses the simple word "Brooks" without any prefix or suffix. On some of its labels, and in some of its telephone listings—notably in the New York City telephone directory—the words "of California" are used.

The defendant, in its answer to the complaint, states that it and "its predecessors have been engaged in the clothing business selling men's and ladies' clothing and apparel in the City of Los Angeles and the State of California for more than twenty-one years last past under the name of Brooks". And that it has conducted and now conducts stores at the places mentioned under the name "Brooks" and has conducted others at other locations which have now been abandoned. It denies that the conduct of such business is, in any wise in unfair competition with the plaintiff. It asserts that, as a fact, its business is not in competition with that of the plaintiff, and that the plaintiff, by its conduct, has been guilty of laches and waived the right to object to the use by the defendant of "Brooks" as a part of its corporate name and in conjunction with the operation of its business.

Other facts, as disclosed by the pleadings of the parties and by the evidence offered in support of their divergent contentions, will be considered further on in the discussion.

II.

Some Inherent Difficulties.

One of the seeming difficulties arising in this case stems from the fact that the Complaint is cast in one claim which combines trademark infringement with unfair competition. Some years ago, I called attention to the fact that, while, since the enactment of the Federal Rules of Civil Procedure, 28 U.S.C.A. following section 723c, the failure to state claims separately is no longer a ground for dismissal,² it was the better practice and more consonant with the requirement of the rules and the spirit of the simpler procedure they inaugurated, to state them separately.³ This is especially true when some of the fundamental differences between principles applicable to trademark cases and to unfair competition cases are borne in mind. The law of unfair competition is of judicial creation and development. The law of trademarks is purely statutory. It may well be true that a trademark does not create any new rights which the owner of the mark may not have had, or which he could not have protected by court action without registration. Nevertheless, registration confers certain valuable rights—among them, a ready means of proving the registrant's right to the mark, and a presumption of its legality. The law of unfair competition is an offshoot of equity, in its attempt to protect persons engaged in business from the unfair practices of others. It is so broad a concept that authors like Mr. Nims have deplored the adoption of the phrase.⁴

Some of the principles which apply to trademark cases do not apply to unfair competition. The law of damages, for instance, calls for proof of actual loss of sales in unfair competition, while in trademark infringement, presumption of loss is inferred from the proof of use of the mark and evidence of sales.⁵ Unfair competition may exist in the absence of a technical trademark.⁶ So, when the issues are not clearly drawn, as they would be if the two claims were stated separately, some confusion must arise. Of necessity, some of the principles in these two branches of the law will overlap. This is because, in the last analysis, they may have arisen out of the same background —namely, the desire to protect a person in his business or good will. This confusion made it impossible during the trial to draw a strict line in the proof. For certain evidence clearly not admissible in a straight trademark infringement case bore on unfair competition. This led the court to suggest to counsel for the plaintiff, at one state of the proceedings, that he might, in order to confine the proof to narrower channels, waive the claim based on unfair competition and limit himself to trademark infringement. This, he refused to do, as was his right. The amalgamation of the two led the defendant to assert that a trademark case could not be dissociated from unfair competition, and that all the broad principles which Courts have declared in unfair competition cases apply to the trademark infringement issue.

Whatever criticism writers may have directed at some of the concepts which have grown up in this realm of the law, as appears from some of the footnotes to two late Annotations on the subject,⁷ this case depends upon principles which are clearly established in the law of this Circuit, and which must control my action. For this reason, cases from other circuit courts will be referred to only when there is no binding decision by the Ninth Circuit Court of Appeals. Anyone who has gone through the annotations of Mr. Nims' great work can readily see the bewilderment resulting from an attempt to reconcile the large number of state decisions, or even the large number of federal district and circuit court deci...