John Roberts Mfg. Co. v. University of Notre Dame Du Lac, Civ. No. 2113.

• Decision Date: 27 June 1957
• Docket Number: Civ. No. 2113.
• Citation: 152 F. Supp. 269
• Parties: JOHN ROBERTS MANUFACTURING COMPANY v. UNIVERSITY OF NOTRE DAME DU LAC.
• Court: U.S. District Court — Northern District of Indiana

152 F. Supp. 269

JOHN ROBERTS MANUFACTURING COMPANY v. UNIVERSITY OF NOTRE DAME DU LAC.

Civ. No. 2113.

United States District Court N. D. Indiana, South Bend Division.

June 27, 1957.

Kenyon & Kenyon, New York City, Gerald A. Kamm, South Bend, Ind., for plaintiff.

Farabaugh, Chapleau & Roper, Eugene C. Knoblock, South Bend, Ind., for defendant.

PARKINSON, District Judge.

This is an action under the Declaratory Judgment Act, 28 U.S.C.A. §§ 2201, 2202, wherein the defendant filed a counterclaim alleging unfair competition, trade-mark infringement and misbranding with submission to the court for an adjudication of the rights of the parties.

The determinative facts established by the undisputed evidence are that the plaintiff is a Delaware Corporation, with its factory and principal office in Norman, Oklahoma, and the defendant is an Indiana corporation, having been so chartered under the corporate name of "University of Notre Dame Du Lac" by a special Act of the Indiana Legislature in 1844 and thereby empowered, inter alia, to make and execute such rules deemed necessary for its welfare, and has developed into a large university with a campus having over one hundred buildings in St. Joseph County, Indiana and with an enrollment of approximately six thousand students and alumni in excess of twenty-five thousand.

In the year 1930 the defendant had designed, and subsequently had manufactured for sale thereby, an official class ring bearing in bas-relief thereon, for all practical purposes, the defendant's corporate name, "University of Notre Dame", and certain symbols of the defendant which had become identified therewith, which it has continuously sold, from 1931 to 1941 through its controller's office and since 1941 in its bookstore on campus, on a restricted basis, to juniors, seniors and alumni of the defendant only.

In the latter part of 1955 Robert Waugh, the secretary of the plaintiff corporation, with the knowledge and approval of John T. Waugh, the president of the plaintiff corporation, wrote a letter to the bookstore of the defendant on plain stationery which he signed as Bob Waugh with a Post Office box address, and ordered an official class ring of the defendant with a follow-up letter a few weeks later, both of which contained statements and representations admittedly false, and plaintiff received the ring pursuant thereto, took a plaster impression thereof, made the necessary dies for production and, in 1956, commenced the manufacture for sale by Royal Hawaiian Jewelers in South Bend, St. Joseph County, Indiana, of a Notre Dame class ring bearing in bas-relief thereon, for all practical purposes, the defendant's corporate name of University of Notre Dame, and the same symbols in the same collocation as on the official class ring of the defendant, and the Royal Hawaiian Jewelers have sold some 479 thereof, of which at least 50% have been to sophomores of the defendant.

The effect of assuming a name by a corporation under the law of its creation is to exclusively appropriate it as an element of the corporation's existence and the use of the name of a corporation on merchandise manufactured by another for sale in competition with the same type of merchandise of the corporation would not only be actual deception and create actual confusion but would of itself constitute a passing or palming off of its merchandise for that of the corporation, the name of which it is wrongfully using, and would be a most flagrant violation of the law of unfair competition. Accordingly the Indiana trade-mark registrations are completely foreign to a decision of the issue here, and although the applications of the defendant for registration of collective membership marks filed in the United States Patent Office were admitted in evidence with limitations, no consideration has been given by this court thereto whatsoever.

This is not the case of a controversy between the plaintiff and another jewelry manufacturer competing in the manufacture and sale of a ring of similar design or with similar insignia thereon and, therefore, the authorities cited have little or no application. However, it may be observed that although the Supreme Court of the United States in the case of Kellogg Co. v. National Biscuit Co., 305 U.S. 111, 59 S.Ct. 109, 83 L.Ed. 73, cited by the plaintiff, held that the use of the term "Shredded Wheat" by Kellogg, the second comer, did not constitute unfair competition, it is self evident that if Kellogg had manufactured and marketed its shredded wheat as "National Biscuit Company Shredded Wheat" it would, without question, have been guilty of unfair competition, and in the case of Sinko v. Snow-Craggs Corporation, 7 Cir., 105 F.2d 450, also cited by plaintiff, although the court held that Cragg, the second comer, was not guilty of unfair competition in marketing a steering wheel knob so resembling Sinko's as to make the two competing articles almost indistinguishable no one would have the temerity to even suggest that our Seventh Circuit Court of Appeals would have so held if Cragg had placed in bas-relief on the bezel of the knob the words "Sinko Mfg. Co.", and in the case of Rader v. Derby, 120 Ind.App. 202, 89 N.E.2d 724, the court did enjoin Derby, the second comer, from using the words "Old Hickory Paddle Company", Rader's trade-name in connection with the fraternity paddles being manufactured and sold by him in competition with those of Rader.

It is the contention of the plaintiff that by marking its rings with the trade-mark "JR", and by prominently featuring its own name in all advertising and sales media reaching members of the student body at Notre Dame, plaintiff has done everything it can reasonably do to "identify its product lest it be mistaken for that of" the defendant. The futility of such reasoning can readily be mirrored in the analyzation of the case of Joe Fink who would form a corporation under the name of Joe Fink, Inc., and, as a second comer, would manufacture and sell an electric toaster on the sides of which in bas-relief it placed the words "General Electric Corporation". Realization is immediate that no matter how prominently Joe Fink, Inc., featured its name in all advertising and sales media and no matter if it placed the initials "JF" all over the toaster confusion could be the only result and there could be no question but that Joe Fink, Inc., was passing or palming off, or attempting to pass or palm off, its toaster as that of General Electric Corporation.

In this case the lack of merit in this contention is far more apparent for the reason that the defendant is not a manufacturer and has its rings made for it by a jewelry manufacturer. Certainly no one is so naive as to think for one moment that a student of the defendant is going to ascertain who makes the ring before he buys it. Therefore, there exists a situation which is perfect for the plaintiff to place the initials "J.R." on the inside of its ring and prominently feature its own name as the manufacturer in all advertising and sales media and, by subterfuge, pass or palm off its rings as those being manufactured for the defendant and constitutes unfair competition of the rankest kind, from which the defendant has absolutely no means of protection.

Further extension of this opinion is unnecessary other than to say that we hold that the undisputed evidence in this record discloses that the plaintiff fraudulently obtained an official Notre Dame ring from the defendant, copied it including the corporate name of the defendant in bas-relief thereon, and has sold it in competition with the defendant to all students of Notre Dame in violation of the rule of the defendant of restricting sales to juniors, seniors and alumni only, and the evidence clearly paints a vivid picture of a fraudulent design on the part of the plaintiff to purposely engage in unfair competition with the defendant, and equity demands that the plaintiff be enjoined from continuing so to do.

Therefore, the court having considered all of the evidence, the law applicable thereto, and the arguments of counsel, does now make the following

Findings of Fact

1.

The plaintiff is a corporation organized and existing by virtue of the laws of the State of Delaware, with its factory and principal place of business in Norman, Oklahoma, and is engaged in the business of manufacturing and selling jewelry.

2.

The defendant is an Indiana corporation, having been chartered under the corporate name of University of Notre Dame Du Lac by a special Act of the Indiana Legislature in 1844 with power thereby given, inter alia, to make and execute such rules deemed necessary for its welfare.

3.

University of Notre Dame is the real body of the corporate name of the defendant, and for all practical purposes, is its corporate name.

4.

The matter in controversy exceeds, exclusive of interest and costs, the sum of $3,000.

5.

There is, among other controversies, an actual controversy in this suit to declare rights and other legal relations of the parties herein within the meaning of the Declaratory Judgment Act (28 U.S.C. § 2201).

6.

The defendant has continuously since the date of its incorporation operated, managed and controlled a university in St. Joseph County, Indiana, with a campus now consisting of approximately 1,000 acres of land and more than 100 buildings, and with an enrollment of approximately 6,000 students, who come from every State of the Union and from approximately 30 foreign countries, and alumni in excess of 25,000, and maintains colleges of liberal arts, science, commerce and engineering and also operates and maintains a law school and a graduate school and is financed through fees charged to students which amount to approximately 70% of the cost of operating the University and the balance of funds required come to the University from various sources, including supplementary income from athletics, operation of the book store and grants...