Drexel Enterprises, Inc. v. Hermitage Cabinet Shop, Inc.

• Decision Date: 19 January 1967
• Docket Number: Civ. A. No. 1741.
• Citation: 266 F. Supp. 532
• Parties: DREXEL ENTERPRISES, INC. v. HERMITAGE CABINET SHOP, INC.
• Court: U.S. District Court — Northern District of Georgia

266 F. Supp. 532

DREXEL ENTERPRISES, INC. v. HERMITAGE CABINET SHOP, INC.

Civ. A. No. 1741.

United States District Court N. D. Georgia, Rome Division.

January 19, 1967.

Rogers, Magruder & Hoyt, Rome, Ga., Gilbert H. Weil and Alfred T. Lee, New York City, for plaintiff.

Glenn T. York, Jr., Cedartown, Ga., Matthews, Maddox, Walton & Smith, Rome, Ga., for defendant.

SIDNEY O. SMITH, Jr., District Judge.

This is a suit brought under the trademark and unfair competition laws of the United States and the State of Georgia, the plaintiff alleging in brief that since 1939, the plaintiff has manufactured, sold, and advertised furniture products under the name of "HERITAGE"; that, subsequently, the defendant began to use and is now using the trademark "HERMITAGE" which, it is alleged, is likely to cause public confusion and to cause the public to believe that the furniture sold by defendants are the goods of plaintiff, or that plaintiff and defendant are in some way associated with each other, or that the plaintiff has sponsored, endorsed, or approved the defendant's goods.

The defendant's answer denied the essential allegations of the complaint and set forth several other defenses.

At pre-trial, the issues were narrowed to provide for a speedy non-jury trial on the issue of infringement only. At the trial, there was considerable stipulation by the parties and a large amount of documentary evidence as well as oral testimony. From all of such sources, the court makes the following

FINDINGS OF FACT

Plaintiff is a corporation organized and existing under the laws of the State of Delaware, with its principal offices located in the State of North Carolina.

Beginning in the year 1939, HERITAGE Furniture, Inc., a corporation of the State of North Carolina, manufactured, advertised and sold furniture under the name and mark "HERITAGE."

Advertising featuring the said name and mark "HERITAGE" appeared in national magazines at least as early as 1946.

Plaintiff registered its trademark "HERITAGE" in 1942 in the states of Alabama, Florida, Tennessee and Georgia and prior to 1950, when defendant commenced operations, the mark was also registered in Illinois, Texas, Ohio, North Carolina, South Carolina, Mississippi and Virginia, all of which were assigned to plaintiff.

During the 1940's, at their own expense, retail dealers in various parts of the country advertised the goods of Heritage Furniture, Inc. in local newspapers under the name and mark "HERITAGE" at least as early as 1947.

Considerable annual sales were made by Heritage into those states prior to 1950. At least as early as 1941-43, its goods were being sold in Alabama, Florida, Georgia, Ohio, Virginia, Illinois, North Carolina, and Texas, as well as many other states throughout the country. In Tennessee, the plaintiff sold over $100,000 worth of goods in the period 1946-1949.

From 1950 to 1956 Heritage Furniture, Inc. operated under a marketing arrangement with Heritage Furniture Industries, Inc., pursuant to which the furniture pieces of the parties were coordinated in style and design and advertised and sold under the combination of their individual marks, to-wit: Heritage-Henredon.

Among the publications carrying advertisements were House & Gardens, House Beautiful and Holiday. The bulk of sales and advertising was under the combination marks, however, Heritage Furniture, Inc. continued throughout to feature its corporate name in a small part of the advertising, and to market a portion of the production labeled as "HERITAGE". Also, some of its retail dealers continued to use the mark "HERITAGE", as such, in their newspaper advertising.

In 1956, the joint marketing arrangement between Heritage Furniture, Inc. and Henredon Furniture Industries, Inc. terminated. Thereupon Heritage discontinued all use of the combination marks and used "HERITAGE" as such in its advertising and on its goods. The mark was applied to the goods by means of woven labels, hang tags and burned-in brand.

On November 30, 1960, Heritage Furniture, Inc. was merged into Drexel Enterprises, Inc., the latter acquiring all assets of the former, including its right in the name and mark "HERITAGE", and all registrations thereof. The business formerly conducted by Heritage Furniture, Inc. has since that date been conducted without interruption and is now being conducted by Drexel Enterprises, Inc. under the name and mark "HERITAGE" through a division known as Heritage Furniture Company.

Plaintiff has also received free publicity in the advertising of its suppliers, which featured the fact that its goods were the goods and components of the plaintiff's furniture.

Plaintiff is also owner of registrations of the trademark "HERITAGE" granted by the United States Patent Office to Heritage Furniture, Inc. for furniture, and subsequently assigned to plaintiff, such registrations being identified as Registration No. 444,792, issued on October 20, 1953; and No. 599,977, issued on December 28, 1954.

In 1942 Heritage Furniture, Inc. registered "HERITAGE" in the states of Alabama, Florida, Tennessee and Georgia, such registrations having been assigned to Plaintiff on November 30, 1960.

Plaintiff's "HERITAGE" furniture is a high quality line, usually traditional in design, and generally sells in the upper price range. It includes "case" goods, but upholstered chairs and sofas constitute about 60% of its business.

Hermitage Cabinet Shops was a corporation incorporated under the laws of the State of Tennessee in March, 1947.

From 1947-1950, it produced reproductions of small articles of furniture contained in the "Hermitage", home of Andrew Jackson. These sales were made from the shop and so far as the evidence discloses unmarked.

In February, 1950, Hermitage Cabinet Shop, Inc. was incorporated under the laws of the State of Tennessee, with Mr. J. W. Gepford as principal stockholder. Hermitage Cabinet Shop, Inc. purchased the inventory and machinery of the corporation known as Hermitage Cabinet Shops in February, 1950.

Defendant Hermitage Cabinet Shop, Inc. is a corporation formed under the laws of the State of Tennessee in 1950. Beginning on or about February 9, 1950, it manufactured furniture which it sold at retail from its manufacturing premises in Nashville, Tennessee. Sales during that period approximated $60,000. Small space ads in which the company's corporate name appeared were run in a local Nashville newspaper on an irregular basis.

From 1950-1954, chairs were added to the production of the company and constituted the sole production by 1955. Occasional and casual sales were apparently made outside the Nashville area. While the articles, mostly chairs, were invoiced and billed under the corporate name, including the word "HERMITAGE", the products were not marketed as such and there is no satisfactory showing of use of the name on the product or the time and place such sales were made during this period. The conclusions of the use of the Heritage name outside the Nashville area are based entirely on the "recollection" of the witness Gepford prior to 1955.

Not until 1961 did defendant undertake any real effort to sell its goods under the name "HERMITAGE" in states other than Tennessee.

Beginning approximately 1954 the defendant sold its goods exclusively through Kreb-Stengel, a broker in New York City, which in turn resold them to retail stores under the Kreb-Stengel name. The sales in that year approximated $200,000. Most of the time defendant's corporate name was not used in connection with the retail sale of the goods; however, the defendant's corporate name appeared on a small woven label under the cushion of upholstered furniture sold by it to Kreb-Stengel in those states where such identification of a manufacturer rather than the distributor was mandatory.

The word "HERMITAGE" is the name of the home of President Andrew Jackson located in Nashville, Tennessee. The word is used in Tennessee as a part of the name of many different businesses.

According to Webster's New International Dictionary, Second Edition, "Hermitage" as a noun is defined to be: 1. The habitation of a hermit; a secluded residence. It is also listed as a pronoun. 2. A mansion near Nashville, Tennessee, long the home of Andrew Jackson, and now owned by the State. "Hermitage" as a noun is defined to be: 1. That which is inherited or passes from heir to heir. The World Book Encyclopedia contains information regarding "Hermitage" and identifies it as the home of Andrew Jackson, near Nashville, Tennessee. The current Nashville, Tennessee, telephone directory carries approximately thirty (30) listings of which the word "Hermitage" is a part.

In or about the year 1960, defendant transferred a portion of its manufacturing operations to Cedartown. Sales during that year approximated $600,000. Within a year or two thereafter, it ceased manufacturing in Nashville, and presently its production facilities are limited to the area of Cedartown, Georgia.

Commencing in 1961, the defendant, while still continuing to sell to Kreb-Stengel as aforesaid, hired an independent commission agent to sell its products in the State of Georgia to retail furniture stores. Thereafter, it extended its distribution through commission agents to a number of other states in the southeastern portion of the country.

In 1965, and except for what it sold to Kreb-Stengel for resale under the latter's name, defendant's sales were primarily limited to retail stores in the States of Alabama, Florida, Georgia, and Tennessee. Its sales during that year approximated $325,000.

With one exception the only use made by defendant of the word "HERMITAGE" on the goods sold by it through commission agents has been as part of its corporate name printed on woven labels and tabs under the cushion of its upholstered furniture. The one exception involved its use of cloth streamers displayed across a quantity of upholstered pieces. The streamers featured the...