Karen Industries, Inc. v. Chiaverotti, 60-C-3.
| Decision Date | 23 March 1960 |
| Docket Number | No. 60-C-3.,60-C-3. |
| Citation | 181 F. Supp. 827 |
| Parties | KAREN INDUSTRIES, INC., an Illinois corporation, Plaintiff, v. Gus CHIAVEROTTI, doing business as King Sales Company, Defendant. |
| Court | U.S. District Court — Eastern District of Wisconsin |
James P. Brody of Foley, Sammond & Lardner, Milwaukee, Wis., and Merriam, Smith & Marshall, Chicago, Ill., for plaintiff.
Edwin C. Rachow, Milwaukee, Wis., for defendant.
This is an action based on diversity of citizenship for infringement of a common-law trademark and unfair competition. The plaintiff is an Illinois corporation, having its principal place of business in Chicago, Illinois. The defendant, an individual doing business as King Sales Company, resides in the State of Wisconsin.
The plaintiff has moved for a temporary injunction restraining the defendant from using the trademark "Hi-Line Fone" in connection with the sale of his product and from using a dress of goods which is deceptively similar to that used by the plaintiff in the packaging of its product.
In April of 1959 the plaintiff originated and developed a toy telephone which is made up of two plastic cup transmitter-receivers held in a cardboard frame and connected by a length of light string. This toy is a refinement of the typical child's string telephone in which the string is drawn tautly between the two transmitter-receivers, and the sound of the voice is transmitted along the line.
In June of 1959 the plaintiff began to manufacture and market its toy telephone under the name "Hi-Fone," and by January of 1960 had sold many hundreds of thousands of these sets throughout the United States. At the present time there are very few States in which the plaintiff has not as yet sold its product, and they are widely scattered. Plaintiff's market can best be described as "nationwide."
On July 11, 1959, the defendant called upon the plaintiff and discussed the possibility of representing the plaintiff as a manufacturer's representative in the distribution of its product. Apparently a tentative agreement was reached, and shortly thereafter fifty samples of the plaintiff's toy were sent to the defendant to be used as an aid in his work.
On September 16, 1959, the plaintiff wrote to the defendant as follows:
Plaintiff did not receive a reply to this letter. In December of 1959, it discovered that defendant was marketing an almost identical toy under the name "Hi-Line Fone." On January 6, 1960, plaintiff instituted this action.
The plaintiff's toy is packaged in a transparent polyethylene bag. To close the bag a label or "header" is folded in tentlike fashion over the top of the package and is held in place by a heat-sealing process. On the face of the label or "header" appears the trademark "Hi-Fone," a pictorial representation of two children using the phone, the price of the toy, and other copy describing the product. On the reverse side of the "header" appear detailed instructions for using the toy telephone.
The telephone manufactured by the defendant, if not identical in size and shape, very closely resembles the plaintiff's product. In addition, it is packaged in the same general manner as the plaintiff's toy; that is, in a polyethylene bag which is topped and sealed by a tent-like "header." Two slight differences between the respective products and packages are that the cardboard frames are of different colors in the two products, and the string portion of the defendant's toy is coiled and covered by a paper wrapper, while the string in the plaintiff's package is simply coiled.
The "header" used by the defendant also strongly resembles that used by the plaintiff aside from a slight difference in the use of color and the absence of any price markings. It is of the same size and shape and prominently displays on its face the mark "Hi-Line Fone" together with drawings of two children using the phone. In addition, the phrases "String Telephone," "For Girls And Boys," "It Really Works," and "Sensational Toy" appear on the label. These are the same phrases which appear on the face of plaintiff's "header" and are only sightly rearranged as to position on the label.
On the reverse side of the defendant's "heade...
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