Chappell v. Goltsman, 13175.

• Decision Date: 19 December 1950
• Docket Number: No. 13175.,13175.
• Citation: 186 F.2d 215
• Parties: CHAPPELL et al. v. GOLTSMAN et al.
• Court: U.S. Court of Appeals — Fifth Circuit

186 F.2d 215 (1950)

CHAPPELL et al. v. GOLTSMAN et al.

No. 13175.

United States Court of Appeals Fifth Circuit.

December 19, 1950.

Henry L. Jennings, Francis H. Hare, Birmingham, Ala., for appellants.

John C. Godbold, Richard T. Rives, Montgomery, Ala., Beekman Aitken, New York City, for appellees.

Before McCORD, BORAH, and RUSSELL, Circuit Judges.

BORAH, Circuit Judge.

Plaintiffs-appellants, as the registered owners of the trade-mark "Bama" for various food products including blackberry preserves, blackberry jellies and blackberry jams, brought this suit to enjoin defendants-appellees from using the word "Bama" in connection with the sale of blackberry wine and for an accounting of profits, damages, costs and destruction of infringing labels.

In response to the complaint the defendants moved to dismiss the action on the ground, amongst others, that the complaint failed to state a claim upon which relief could be granted and in support thereof presented the affidavit of Ben R. Goltsman. Also, and without voluntarily submitting to the jurisdiction of the court, the defendants filed an answer and counterclaim.

In their answer defendants admit registration of the trade-mark by plaintiffs but deny validity of the registration because, as they say, it is a geographic expression. They also admit receipt of notice from the plaintiffs to cease and desist from the use of the word "Bama" in the sale of their products. All other averments of the complaint are denied with this notable exception that defendants do not in their answer specifically deny the interstate character of their business. As affirmative defenses the defendants plead and say: (1) That defendants sell no food products under their trade-mark "Bama" but limit their use of the trade-mark exclusively to wines; that plaintiffs do not sell wines but rather sell food products and that the goods of the two companies are not sold in the same stores or in competition and that there does not now exist and there is no reason to expect that there will be any confusion in the minds of purchasers between the goods of plaintiffs and the goods of defendants; (2) that there is such a marked difference in the appearance of the labels that ordinary shoppers would not be confused as to the source of origin of defendants' wine; (3) that the trade-mark "Bama" is the nickname of the State of Alabama and plaintiffs have no right to its exclusive use since they do not allege that said geographical term has secured a secondary significance as designating goods manufactured by the plaintiffs alone and that the term "Bama" is in use by certain named businesses operating in the State of Alabama; and finally, (4) that the goods of the parties are of different descriptive properties and no confusion is likely to result from their sale under identical trade-marks since they are sold in different stores to an entirely different class of purchasers.

A hearing was had on the motion and thereafter the court filed its opinion¹ and

order granting the motion to dismiss. In its opinion the court held that plaintiffs have no right to the exclusive use of the word "Bama", a nickname of the State of Alabama which, through long general use, has lost all elements of originality and distinctiveness, and that such a symbol or device is available for use as a trade-mark for all who fairly and in good faith choose to make use of it. The court further held that any element of bad faith, unfair competition, or perfidious dealings is lacking by reason of the fact that defendants are engaged in a completely different type of business from that of the plaintiffs. Moved by these considerations and "in the light of the attendant circumstances" among which is the fact that there were other registrations of the word "Bama" the court concluded that plaintiffs had failed by their pleadings to make out a case of trade-mark infringement or unfair competition. In its order dismissing the complaint the court retained jurisdiction to reinstate the bill of complaint and grant the relief prayed for in the event the defendants failed and refused within thirty days to comply with the court's requirement that all advertising matter and wine labels show that the wine is bottled and sold by the Alabama Growers Association or Ben R. Goltsman and Company. Upon entry of the order plaintiffs promptly moved that same be vacated and set aside and a rehearing granted on the ground that the court had erred throughout in its findings and had reached a determination in these matters without affording to plaintiffs the opportunity of producing evidence relative thereto. Attached to the motion were three affidavits supportive of the allegations of the complaint, the substance of which were that the word "Bama" as used by plaintiffs had acquired a secondary meaning in connection with products for human consumption and that confusion had already been created in the minds of the public due to the conflicting use of this trade-mark for wine by the defendants; and that the trade-mark registrations cited in the answer were taken out subsequent to plaintiffs' registration and were not used in commerce to any extent that would lead to confusion. The motion was denied and this appeal followed.

In its memorandum denying plaintiffs' motion to vacate and set aside the original order the court referred to the fact that plaintiffs were demanding their day in court to offer evidence in support of their contention that the acts of the defendants as charged are calculated and intended to deceive the public into the belief that the products sold by the defendants are products placed upon the market by plaintiffs. It noticed the fact that the complaint does not allege and that plaintiffs do not contend that they ever have in the past or ever intend in the future to manufacture or sell wine of any kind. It referred to the recital in the answer that defendants' product is sold only to the Alabama Beverage Control Board, and judicially noticed that such wine is sold in Alabama only from State liquor stores or from places which have permits from the Beverage Control Board, and that the places in which plaintiffs' products are sold are not permitted by law to sell wine. The court then ruled: "After weighing these facts as established by the pleadings in this case and the affidavit(s) offered in support of defendants' answer, this court believes and so finds that the plaintiffs would not be able to offer any substantial evidence in support of the allegations contained in the bill of complaint."

It is apparent that the court accepted as an established fact all of the averments contained in the answer and affidavit of Goltsman and completely disregarded as unimportant the averments of the complaint in respect to the long continued use of the trade-mark; the fact alleged that plaintiffs' trade-mark has become identified with plaintiffs' products and business to the exclusion of all others and has thus acquired a secondary meaning; the averment that the similarity of defendants' trade-mark to the...