Induct-O-Matic Corp. v. Inductotherm Corp.

Decision Date31 October 1984
Docket NumberINDUCT-O-MATIC,No. 83-1271,83-1271
Citation747 F.2d 358
PartiesCORPORATION, Plaintiff-Appellant, v. INDUCTOTHERM CORPORATION, Defendant-Appellee.
CourtU.S. Court of Appeals — Sixth Circuit

Michael R. Dinnin (argued), Harness, Dickey & Pierce, Birmingham, Mich., for plaintiff-appellant.

Arthur H. Seidel (argued), Seidel, Gonda, Goldhammer, P.C., Philadelphia, Pa., for defendant-appellee.

Before KENNEDY and WELLFORD, Circuit Judges, and RUBIN, District Judge. *

WELLFORD, Circuit Judge.

In June 1978, Inductotherm, defendant-appellee, filed a trademark opposition proceeding in the United States Patent Office to protest the grant of a trademark registration to plaintiff-appellant for its mark "INDUCT-O-MATIC" (IOM). The Trademark Examiner, however, already had ruled in May 1978 that the mark "INDUCT-O-MATIC" was entitled to registration over Inductotherm's registered mark, "INDUCTO." 1 In October 1978, Inductotherm filed suit against IOM in the United States District Court of New Jersey, which dismissed the suit for lack of jurisdiction. IOM then filed an action for declaratory judgment in the United States District Court of Michigan on February 1, 1979, seeking a determination that IOM's use of "INDUCT-O-MATIC" did not result in any trademark infringement, unfair competition, or false designation of origin in regard to Inductotherm's registered trademark, "INDUCTO." Inductotherm, counterclaiming, contended that such usage did result in these violations of law. IOM appeals from the judgment of the district court granting Inductotherm an injunction prohibiting IOM's further use of the mark "INDUCT-O-MATIC."

Inductotherm began repairing and servicing induction heating and melting equipment in 1953 under that name. In 1954 Inductotherm began using the term "INDUCTO" and the tradename "Inductotherm" on its equipment and since 1957 has been manufacturing and selling this equipment throughout the United States, including the State of Michigan. On July 14, 1964, Inductotherm became the owner of United States Trademark Registration No. 773,193 for the trademark, "INDUCTO."

IOM, chartered as a Michigan corporation, began doing business under the tradename "Induct-O-Matic" and began using the mark "INDUCT-O-MATIC" on or about January 4, 1961. Prior to 1969, its business consisted primarily of rebuilding and repairing induction equipment; thereafter, it began selling induction heating equipment in various states under its tradename and mark.

The district court first considered and granted relief on Inductotherm's counterclaim of trademark infringement by IOM in violation of the Lanham Act, 15 U.S.C. Sec. 1114. Under the Act, the test of trademark infringement is "likelihood of confusion" as to the source of origin. See, e.g., WSM, Inc. v. Tennessee Sales Co., 709 F.2d 1084, 1086 (6th Cir.1983). This Court has adopted a two-level test for reviewing lower court findings of likelihood of confusion:

[T]he determination of what is the state of affairs regarding each factor ... [considered by the lower court in determining whether there is a likelihood of confusion] is a finding of fact reviewed on the clearly erroneous standard, but the further determination of the likelihood of confusion based on those factors is a legal conclusion.

Frisch's Restaurants, Inc. v. Elby's Big Boy, 670 F.2d 642, 651 (6th Cir.), cert. denied 459 U.S. 916, 103 S.Ct. 231, 74 L.Ed.2d 182 (1982) (quoting Alpha Industries, Inc. v. Alpha Steel Tube & Shapes, Inc., 616 F.2d 440, 443-44 (9th Cir.1980)).

In reaching its holding that there was a likelihood of confusion between Inductotherm's trademark, "INDUCTO," and IOM's tradename and mark, "INDUCT-O-MATIC," the district court considered the following list of factors, which are in substantial conformity with those relevant factors on this issue set forth by this Circuit in Frisch's Restaurant, 670 F.2d at 648:

1) the degree of similarity between the marks in appearance, sound, and connotation;

2) the similarity of goods or services for which the marks are used;

3) the area and manner of concurrent use;

4) the strength of the defendant's mark;

5) the sophistication of the purchasers of the relevant goods;

6) plaintiff's intent;

7) and any instances of actual confusion.

The district court found a high degree of similarity between "INDUCTO" and "INDUCT-O-MATIC," noting that "a sophisticated witness and possible purchaser ... indicated that 'INDUCT-O-MATIC' would connote a product produced by [Inductotherm]." The court also found that "the differences in lettering and hyphenating are very slight, and likely to cause confusion."

This finding is not clearly erroneous.

IOM contends that the differences in spelling, number of syllables, the use of hyphens, and sound and visual appearance establish little likelihood of confusion between the marks at issue. We agree with the district court that these differences are slight and unlikely to prevent confusion. The use of hyphens distinguishes between the two marks only on a visual level since this difference is absent when the words are spoken. Other distinguishing factors cited by IOM depend solely on the addition of "MATIC" to its trademark. We agree with the district court that this is a weak and nondistinctive term. The latter aspect of our holding is discussed more fully in our review of the district court's ruling in regard to the strength of Inductotherm's trademark.

The District court's finding that the marks in question are used on similar goods also is not clearly erroneous. The district court correctly noted that IOM sells primarily induction heating equipment, whereas Inductotherm sells primarily induction melting equipment. Since most of Inductotherm's equipment can also be used for induction heating, the effect of the differences in the equipment is greatly lessened. Moreover, Inductotherm does sell some induction heating equipment and also performs virtually all of the services offered by IOM.

IOM's argument that it does not directly compete with Inductotherm is belied by its failure to contest the district court's finding in regard to concurrent use that "both parties sell in the same states, have some identical customers, and have the same competitors." Moreover, the similarity of goods and services offered by IOM and Inductotherm indicates the probability of direct competition. In any event, "direct competition between the products is not a prerequisite to protective relief." Continental Motors Corp. v. Continental Aviation Corp., 375 F.2d 857, 861 (5th Cir.1967).

In regard to the fourth factor, the district court found that "INDUCTO" was a strong mark, "distinctive in its tendency to identify the goods sold under that mark as emanating from ... [Inductotherm]." In reaching this conclusion, the district court found that "INDUCTO" was a coined word with no dictionary or technical meaning, under which Inductotherm has had a large volume of sales and has established an excellent reputation. In contrast, it found IOM's mark to be "weak and undistinctive," noting that "[t]he 'matic' suffix indicates automatic, and is widely used in trademarks for this purpose."

IOM argues that the district court erred in failing to recognize that "induct" is a common English word, meaning to lead in, introduce or induce, that is suggestive of induction, and refers to a number of trademark registrations incorporating the word "induct" by third parties engaged in the electromagnetic induction field. We agree with the district court that these registrations do not, on the whole, 2 dilute any distinctive nature "INDUCTO" may have since these registrations do not involve products that compete with IOM and Inductotherm. See, e.g., Price-Pfister Brass Mfg. Co. v. Milwaukee Faucets, Inc., 311 F.2d 817, 818 (C.C.P.A.1963). We find, however, that the district court was in error in its finding that "INDUCTO" was a "coined" word, which implies that it is an arbitrary or fanciful term. As noted in Miller Brewing Co. v. G. Heileman Brewing Co., 561 F.2d 75, 79 (7th Cir.1977), cert. denied 434 U.S. 1025, 98 S.Ct. 751, 54 L.Ed.2d 772 (1978) (citations omitted):

A term for which trademark protection is claimed will fit somewhere in the spectrum which ranges through (1) generic or common descriptive and (2) merely descriptive to (3) suggestive and (4) arbitrary or fanciful.

* * *

* * *

A generic or common descriptive term is one which is commonly used as the name or description of a kind of goods. It cannot become a trademark under any circumstances.

* * *

* * *

A merely descriptive term specifically describes a characteristic or ingredient of an article. It can, by acquiring a secondary meaning, i.e., becoming "distinctive of the applicant's goods" ..., become a valid trademark.

* * *

* * *

A suggestive term suggests rather than describes an ingredient or characteristic of the goods and requires the observer or listener to use imagination and perception to determine the nature of the goods. Such a term can be protected without proof of a secondary meaning.

* * *

* * *

An arbitrary or fanciful term enjoys the same full protection as a suggestive term but is far enough removed from the merely descriptive not to be vulnerable to possible attack as being merely descriptive rather than suggestive.

This Circuit in Solventol Chemical Products v. Langfield, 134 F.2d 899 (6th Cir.), cert. denied 320 U.S. 743, 64 S.Ct. 44, 88 L.Ed. 441 (1943), clearly held that trademarks at issue must be broken down into their component parts in order to determine their appropriate class in the trademark spectrum. As between "Sonventol" and "Solvite," the marks at issue in Langfield, the court ruled that the component common to each term was descriptive:

Neither of the marks in question is of that class known as arbitrary or fanciful. Each falls quite clearly into the class of suggestive marks characteristic of the product...

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