Donovan v. Wilson Sporting Goods Co.

• Decision Date: 23 February 1961
• Docket Number: No. 5725.,5725.
• Parties: Thomas F. DONOVAN, Assignee, Intervenor, Appellant, v. WILSON SPORTING GOODS CO., Defendant, Appellee.
• Court: U.S. Court of Appeals — First Circuit

285 F.2d 714 (1961)

Thomas F. DONOVAN, Assignee, Intervenor, Appellant, v. WILSON SPORTING GOODS CO., Defendant, Appellee.

No. 5725.

United States Court of Appeals First Circuit.

January 5, 1961.

Rehearing Denied January 31, 1961.

Amended February 23, 1961.

Harold E. Cole, Boston, Mass., for appellant.

Louis R. Simpson, Chicago, Ill., with whom William H. Taylor, Jr., Boston, Mass., R. Howard Goldsmith and Schneider, Dressler, Goldsmith & Clement, Chicago, Ill., on the brief, for appellee.

Before WOODBURY, Chief Judge, and HARTIGAN and ALDRICH, Circuit Judges.

ALDRICH, Circuit Judge.

This is an action for "unfair competition and unfair conduct," involving the right to make commercial use of the names of prominent persons as against one to whom such persons have purported to grant exclusive use. The court dismissed the complaint, but on a narrow ground. Plaintiff Globe Sporting Goods Corporation, prior to making a general assignment for the benefit of its creditors to intervening plaintiff Donovan, was a manufacturer and importer of sporting goods, notably baseball gloves. Defendant, Wilson Sporting Goods Company, is one of the country's largest manufacturers of such goods. An important sales promotion feature in this field is the use of well-known names. As Donald Duck sells toys and Davy Crockett once sold hats, a name such as Ted Williams is a valuable pitch to buyers of baseball gloves and bats. Some manufacturers, of which Wilson is a conspicuous example, enter into royalty contracts with prominent players for the exclusive use of their names, and support their acquisition with extensive advertising. Apparently a fielder's glove with a Ted Williams signature catches more eyes, even if it catches no more flies.¹ Others, including Globe, lacking such agreements,² sometimes offer gloves with a player's name in block print, followed by some word such as "Model" or "Style." Wilson claims this is dirty ball.

In the winter of 1958 Wilson demanded of Globe that it cease using the names of certain listed players who had allegedly given Wilson exclusive use. Globe replied that it always appended the word "Model" in such instances, and that, since this was an accurate statement about a public figure, it had the right to do so under Hanna Mfg. Co. v. Hillerich & Bradsby Co., 5 Cir., 1935, 78 F.2d 763, 101 A.L.R. 484, certiorari denied 296 U.S. 645, 56 S.Ct. 248, 80 L.Ed. 458. In Hanna it was held that where a ball player used a bat of certain dimensions, a manufacturer who copied the specifications could properly advertise that it was a "Gehrig style" or "Ruth style" bat. It is conceded, however, that Globe, other than distinguishing between catchers' mitts and fielders' gloves, arbitrarily assigned players' names to its various products without any attempt to follow the individual preferences of the players. But so did Wilson, the only difference between them being that Wilson had contracts with the players. What Wilson's buyers received is debatable. There was no proof adduced of what buyers understand a player's signature to mean, but we doubt whether it is simply a general endorsement of the quality and dependability of the manufacturer's equipment. Rather, it would seem that the name offers the user the "identification," or the assurance, that would flow from possessing a glove in the particular player's style, when in fact it is not. See Hanna Mfg. Co. v. Hillerich & Bradsby Co., supra, 78 F.2d at page 767. The ultimate question, which we do not reach, is whether the player can assign such a right of exclusive use, or misuse.

When Globe replied that it would resist Wilson's demands, Wilson commenced suit in the United States District Court in New York against Globe and one Katz, who was Globe's sole distributor. Service was obtained only upon Katz, and that suit has not been pressed. Globe then brought the instant action in the District of Massachusetts. At the trial Wilson admitted that in March 1958 it wrote to all its dealers that its exclusive rights were being violated and that it intended to take action to protect them. It further admitted that it sent a copy of this letter to The Sporting Goods Dealer, a monthly trade magazine, which published an account thereof. Wilson included with this letter a copy of a supporting opinion of counsel. Lacking legal discernment, the magazine confused the cases cited, and concluded its report with the following sentence.

"A federal court ruling in New York back in 1953 made a point that the use of players\' names on gloves or bats must have the athlete\'s approval even if `style\' or `type\' rather than a signature is used."

The report was also inaccurate in that it indicated that Wilson proposed to sue dealers as well as manufacturers and distributors. Wilson's letter was far less specific.

In point of fact, the Second Circuit case cited in counsel's memorandum,³ while it did criticize Hanna, involved photographs upon packaged chewing gum, and is readily distinguishable. The magazine article thus considerably overstated Wilson's position and the strength of the authority behind it. Globe wrote Wilson complaining of this publication, but Wilson did nothing about it. It is not difficult to imagine that notice of an impending suit against them by a giant in the industry, armed with a federal court case, might dampen dealers' enthusiasm to handle the goods of an alleged infringing competitor. Plaintiffs' evidence indicates that the market thereafter dried up, and that Wilson's letter and the magazine article were the cause.⁴ Or, as they express it in their brief, Wilson had successfully "put the finger on Globe's gloves."

If this were the fact, Wilson could avoid liability only if its charge of unlawful conduct by Globe was true, that is to say, legally correct, or, even though incorrect, if the charge was made in bona fide exercise of a privilege to protect what it reasonably believed to be its rights. Wilson did not defend on the first of these grounds below, and expressly declined to do so here (although not conceding the opposite). In this posture we will not explore on our own initiative what would be at best a very complicated issue involving, inter alia, in view of the national publication, difficult questions of conflicts of law. Hartmann v. Time, Inc., 3 Cir., 1948, 166 F.2d 127, 1 A.L.R.2d 370, certiorari denied 334 U.S. 838, 68 S.Ct. 1495, 92 L.Ed. 1763; 48 Col.L.Rev. 932; Dale System v. Time, Inc., D.C.D.Conn.1953, 116 F.Supp. 527; O'Reilly v. Curtis Publishing Co., D.C.D. Mass.1940, 31 F.Supp. 364; Prosser, Interstate Publication, 1953, 51 Mich.L. Rev. 959.

With this lengthy background we come to the court's disposition. The court dismissed the action on the following grounds: (1) The article in The Sporting Goods Dealer "had no direct support from Wilson, but was a mere trade reference to a trade activity," and Wilson was not "in any way responsible for the publication." (2) Wilson's letter to its dealers was not unfair competition because "unfair competition, in Massachusetts, is limited to the passing off of one's goods as those of a competitor." (3) Wilson had a right to "advise its dealers or customers of any infringement of its rights" in the absence of bad faith, and there was no bad faith. (We take it the court meant "alleged rights" because it expressly did not determine whether the claim was valid.)

(1) Wilson considers plaintiffs' attack on the court's finding that it was in no way responsible⁵ for the publication in The Sporting Goods Dealer "amazing."⁶ We, on the other...