Soy Food Mills v. Pillsbury Mills

• Decision Date: 10 April 1947
• Docket Number: No. 8996.,8996.
• Citation: 161 F.2d 22
• Parties: SOY FOOD MILLS, Inc., v. PILLSBURY MILLS, Inc.
• Court: U.S. Court of Appeals — Seventh Circuit

161 F.2d 22 (1947)

SOY FOOD MILLS, Inc., v. PILLSBURY MILLS, Inc.

No. 8996.

Circuit Court of Appeals, Seventh Circuit.

April 10, 1947.

George F. Williamson and Bradshaw Mintener, both of Minneapolis, Minn., and Leo F. Tierney, of Chicago, Ill., for appellant.

Truman A. Herron, of Cincinnati, Ohio, and Lee J. Gary, of Chicago, Ill. (Wood, Arey, Herron & Evans, of Cincinnati, Ohio, of counsel), for appellee.

Before EVANS, SPARKS, and MINTON, Circuit Judges.

EVANS, Circuit Judge.

This appeal is from a decree rendered in an unfair competition and infringement of trade-mark and copyright suit wherein each party sought relief from the other.

The plaintiff charged defendant with unfair competition and with the infringement of its copyright, "Golden wheat-soy Mix" and also with infringement of its copyright, "Golden Soy Griddle Cake Mix."

Defendant filed an answer and also a counterclaim. It denied the facts upon which plaintiff based its prayer for relief, and also sought affirmative relief, consisting of an injunction against plaintiff's use of its trade-mark, "Golden Bake" and from other unfair methods of competition and from advertising or attempting to sell its product as defendant's made product. It also sought an injunction to stop plaintiff's alleged infringement of defendant's registered labels and its trade-marks.

Both sides also sought damages and an accounting.

After an extended trial, the Court found in plaintiff's favor on some of its unfair competition charges and against it on certain of its other charges. It found against the defendant on all of the material and controverted charges set forth in its counterclaim.

The importance of accuracy justifies our setting forth in haec verba, the terms of the decree. We quote therefrom.^*

Both parties are engaged in selling a flour mix. The label copyrights and trademarks involved, and the alleged unfair competition turn on the cover designs and words appearing on the cartons that carry the flour.

Reproduced herewith, is the trade-mark, Golden Soy, and trade-mark, Golden Mix and the label copyright, Golden wheat-soy Mix, all plaintiff's.

Defendant's 1935 trade-mark is herewith reproduced and the label which it used after August, 1943 is also reproduced. The colors are of necessity eliminated.

The Court made findings which it subsequently modified upon defendant's motion. These findings are controlling with us wherever there is evidence to support them, even though the evidence be strongly disputed.

Defendant argues that certain findings are wholly unsupported by evidence and must be rejected by us. It is this contention which makes this appeal so involved factually and so difficult of satisfactory statement and determination. For example, we are asked by plaintiff to accept the Court's appraisal of the defendant's trade-mark, Golden Bake, and its denial of defendant's right to add to the words, "Golden Bake," the word, "Mix."

It also asks us to accept the Court's finding that defendant adopted Golden Bake Mix deliberately and with knowledge of plaintiff's product and its name, Golden wheat-soy Mix. It bases its case largely on this adoption of names, which, together with the carton and label so similar to plaintiff's cartons that defendant was able to, and did, pass off its product as plaintiff's product. Its charge of unfair competition is thus established, so plaintiff argues.

Defendant, on the other hand, argues that there is no evidence, other than the labels themselves which are before the Court and which we can evaluate as well as the District Court, which supports the finding of unfair competition by defendant. The same is true of its asserted claim of protection under its trade-mark, "Golden Bake." It contends that there is nothing sacrosanct about a district court finding when that finding deals with a trade-mark and a trade-name. In short, this court may say, and in fact must decide, whether defendant, whose use of "Golden Bake" is clear, may not add the word, Mix, even though plaintiff used the words, "Golden wheat-soy Mix" between the date when defendant first used Golden Bake and the date when its Golden Bake Mix appeared. The evidence, so it is argued, is of equal persuasiveness in both courts. Just as a finding in the District Court is not conclusive where the evidence is by deposition — equally open to both courts — so is the question presented by the use of trade-names open to both lower and appellate courts for their separate determination as to confusing similarity.

We are of the opinion that not only is the factual question thus open to the appellate court, but it is our unavoidable duty to examine the two trade-marks or trade-names or copyrights and decide the question of fact for ourselves. We must, however, give to the District Court's opinion on such issues, consideration and weight because of its source.

In the last analysis, our examination of the carton and of the names and the date of appearances of said cartons convinces us the controversy turns largely upon the use of the word, Golden. It is clear that the defendant's objectionable cartons and words selected by it to describe its product do not constitute a Chinese copy of plaintiff's carton or trade-mark or trade-name or advertisement. Likewise, plaintiff did not use defendant's prior chosen trade-mark, Golden Bake. On the question of unfair competition we find the colorings of cartons used by the plaintiff are not exactly similar to those used by the defendant nor were defendant's exactly similar to those used by plaintiff.

Rather important is the matter of dates. Defendant was an old manufacturer in the field. It was one of the largest pancake flour manufacturers in this country. It had been a leader in the flour business, including pancake flour, for many years — over half a century. Plaintiff appeared in the commercial field in 1942 and enlarged its business in 1943. It did not manufacture its flour but caused a flour mill to prepare its product in accordance with a formula which it submitted.

Such competition as existed between the parties arose in 1943. At this time the country was at war and conservation of flour was a government objective. This was accomplished in part by the introduction of soy bean flour into the pancake flour mixes.

Plaintiff insists, that its formula has great merit. The Court's finding in respect thereto is conclusive. We accept it.

Soybean, as an addition to the wheat or other flour used in pancake or muffin flour, while not new in 1942, became a more important factor during these war years. Whether the public was moved by patriotic sentiment or a fondness for soy flour in pancake mixes is immaterial. It was an ingredient which both companies could use and in the proportion which each chose. The more used, the better the Government liked it. Plaintiff's percentage of soy flour was relatively small. Defendant used as much as twenty percent in its pancake flour mix.

Plaintiff was not the first to use soy bean flour in pancake flour nor did it precede the defendant in its use in this field. There were also other pancake flour manufacturers who made a pancake mix with soybean additions, prior to 1942.

Over-emphasis has been given to the contents of the mix, so we think. The controversy is over the words of the trade-marks, together with the colors which appear on the cartons in which the mix was sold. The litigation is over the use of pancake flour mix packages. It is not over the pancake flour.

It is important to bear in mind that pancake flour mix may have ingredients other than soy bean flour. The word, Mix, indicates merely that it is not a straight wheat flour, or buckwheat flour, or rice flour, but has an additional ingredient.

Defendant contends that plaintiff has been guilty of unethical conduct aside from its unfair competition which must preclude it from obtaining any affirmative relief in a court of equity. In other words, plaintiff's hands are not clean.

It asserts first, that plaintiff used the word, Mills, in its name (Soy Food Mills, Inc.) to inform the public falsely that it made its own product whereas it never made any of its product but purchased its mix from a flour mill which made the product for it.

Second, defendant argues that the United States Government instituted a libel against the plaintiff's pancake flour, charging the use of false and deceiving advertising matter on the cartons containing its pancake flour mix, and obtained a decree enjoining plaintiff from selling its product in such cartons because said cartons carried false and deceptive advertisements and because plaintiff falsely asserted the existence of ingredients not in its mix and attributed to its product virtues which were untrue. The court, later, permitted plaintiff to sell its products in cartons with the objectionable advertisements eliminated, but only under the supervision of the "Food and Drug Administration, Federal Security Agency" and upon plaintiff's paying the "transportation, salary and such other necessary expenses" "incurred by the Administration in connection with said supervision." This concession by the government to the plaintiff was due to the government's desire to avoid the loss of any wheat flour.

In the development of its trade-mark and trade-name, plaintiff first used Golden Soy. It used this label on its cartons. It neglected to publish notice of such copyright on 1,000,000 of its cartons. Defendant argues that plaintiff lost its copyright thereby and in legal effect dedicated it to the public. Thompson v. Hubbard, 131 U.S. 123, 150, 151, 9 S.Ct. 710, 33 L.Ed. 76. Defendant, however, goes further and contends that plaintiff could not regain its rights thus lost by failure to give notice to the public, by securing another trade-mark covering the same subject. It relies on Universal Film Mfg. Co. v. Copperman, 2 Cir., 218 F. 577 and Sieff v. Cont. Auto Supply, Inc., D.C., 39 F.Supp. 683, in addition to...