Haymaker Sports, Inc. v. Turian
Decision Date | 03 August 1978 |
Docket Number | Appeal No. 78-532. |
Parties | HAYMAKER SPORTS, INC., Appellant, v. Herman TURIAN, Appellee. |
Court | U.S. Court of Customs and Patent Appeals (CCPA) |
Joel S. Goldhammer, Arthur H. Seidel, Philadelphia, Pa. (Seidel, Gonda & Goldhammer, P. C.) Philadelphia, Pa., attorneys of record, for appellant.
A. D. Caesar, Philadelphia, Pa. (Caesar, Rivise, Bernstein & Cohen, Ltd.) Philadelphia, Pa., attorneys of record, for appellee.
Before MARKEY, Chief Judge, and RICH, BALDWIN, LANE, and MILLER, Associate Judges.
This appeal is from a decision of the Patent and Trademark Office ("PTO") Trademark Trial and Appeal Board ("board"), 197 USPQ 32 (1977), denying in part a petition by appellant, Haymaker Sports, Inc. ("HSI"),1 to cancel the registration of the mark HAYMAKERS.2 We reverse.
HSI is the owner of registrations for HAYMAKER3 and CHARLES OF HAYMAKER4 for women's sportswear such as shirts, skirts, blouses, dresses, suits, and slacks, and for women's jewelry. Earliest use in commerce of its marks was 1945. The original owner of the registration in issue, Avon Shoe Co. ("Avon"), first used the mark HAYMAKERS in commerce on shoes in 1941. In 1953 Avon brought suit5 against HSI and its parent, David Crystal, Inc., to enjoin HSI's use of HAYMAKER on women's sportswear. The suit culminated in a judgment which, although likelihood of confusion was found from both parties' use of substantially identical marks, permitted each party to continue use of its respective mark on its respective goods. Avon Shoe Co. v. David Crystal, Inc., 279 F.2d 607, 125 USPQ 607 (CA 2 1960).
As a result of this litigation, Avon was unable to pay its attorneys' fees and, upon their suit for collection in 1962, entered into an agreement on June 13, 1963, providing for certain "escrowees," Max Block (attorney for Avon) and Eugene Moran (attorney for the unpaid attorneys), to be assigned Avon's mark HAYMAKERS as collateral security for payment. The pertinent portions of that agreement read:
Avon continued using the mark on shoes it manufactured, but its business declined. A default resulted when it was unable to make payment under the terms of the agreement. Pursuant to the agreement, Block and Moran then recorded the assignment to the unpaid attorneys (Corey, Hart & Stemple) in the PTO on March 26, 1964. A week later, the parties entered into a second agreement. Like the first agreement, this stipulated that the mark had been assigned as collateral security for payment, set up a new payment schedule, and included a new provision, which read:
EIGHTEENTH: In the event the corporate defendants shall permanently cease to do business, then and in that event any of the owners of stock of either of said corporations shall have the right to continue the minimum payments provided for in this stipulation and, upon payment by said owners of stock of the total minimum herein provided, the security . . . shall be re-assigned by the ESCROWEES to the individuals making the said minimum payments.
By late 1967, Avon had ceased operations altogether and had defaulted on the second agreement. In July 1968, Turian, as a stockholder of Avon, paid off the outstanding debt to Block and Moran, who then assigned him the registration.6 Since then, Turian or corporations owned by Turian have used the mark HAYMAKERS on shoes (either manufactured by his corporations or imported by him).
The board found that the prior litigation between HSI and Avon did not preclude it from considering HSI's petition to cancel. It said that "the factual situation which the Court concluded existed in 1960 no longer exists and there are now different marketplace and factual elements that must be considered," one of which involved the question whether Turian or any of his predecessors had abandoned the mark HAYMAKERS. The board found that under the first agreement between Avon and its creditors, the parties clearly did not intend that the assignment have any immediate legal effect and that an agreement for the future assignment of a trademark is not an outright assignment. With respect to Avon's default and the recording in the PTO of the assignment to Block and Moran, the board found that the second agreement between the parties a week later "resurrected" the assignment as collateral for Avon's performance and impliedly granted Avon a license to continue to use the mark in its business operations.
As to the assignment from Block and Moran to Turian, the board found no significance in Turian's acquisition of none of the "salient accouterments" of Avon's business because he knew the names of Avon's customers and did not need the shoe lasts or machinery. After noting that Turian, as a stockholder, had paid off the outstanding debt of Avon pursuant to the eighteenth paragraph of the second agreement, the board said:
Under these circumstances, it is our opinion that the assignment in question was not invalid as an assignment in gross and that respondent received a valid and legal title to these trademarks.OPINION
Turian urges that HSI is estopped from asserting any damage from his use and registration of the mark because of the previous litigation between the parties in Avon Shoe Co. v. David Crystal, Inc., supra. However, the basis of the court's decision in the prior case to permit concurrent use by the parties rested, at least in part, on the existence of a valid, federally registered mark to Avon and Avon's position as senior user. HSI had no opportunity to raise the issue of validity of the two subsequent assignments. Additionally, circumstances in the marketplace have changed since 1960. Avon suffered declining business and finally ceased operations, while HSI has continued to expand its business and actively promote its marks. We agree with the board that such changed circumstances preclude application of the doctrine of collateral estoppel. Accord, Old Grantian Co. v. William Grant & Sons, 361 F.2d 1018, 53 CCPA 1257, 150 USPQ 58 (1966); see In re Superior Outdoor Display, Inc., 478 F.2d 1388, 178 USPQ 151 (CCPA 1973).
In determining whether the requisite transfer of goodwill accompanied the transfer of the mark from Avon to Block and Moran, we note that the board gave no reasons to support its conclusion that the assignment recorded...
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