Kiki Undies Corp. v. Promenade Hosiery Mills, Inc.

• Decision Date: 29 May 1969
• Docket Number: No. 543,544,32664.,Dockets 32659,543
• Citation: 411 F.2d 1097
• Parties: KIKI UNDIES CORP., Plaintiff, Appellant and Cross-Appellee, v. PROMENADE HOSIERY MILLS, INC., Defendant, Appellee and Cross-Appellant.
• Court: U.S. Court of Appeals — Second Circuit

411 F.2d 1097 (1969)

KIKI UNDIES CORP., Plaintiff, Appellant and Cross-Appellee, v. PROMENADE HOSIERY MILLS, INC., Defendant, Appellee and Cross-Appellant.

Nos. 543, 544, Dockets 32659, 32664.

United States Court of Appeals Second Circuit.

Argued April 23, 1969.

Decided May 29, 1969.

Charles R. Brainard, New York City (John A. Fogarty, Jr., W. Cullen MacDonald, and Kenyon & Kenyon, New York City, on the brief), for plaintiff, appellant and cross-appellee.

I. Walton Bader, New York City (Bader & Bader, New York City, on the brief), for defendant, appellee and cross-appellant.

Before LUMBARD, Chief Judge, ANDERSON, Circuit Judge and WYATT, District Judge.^*

ANDERSON, Circuit Judge:

This action was brought on March 15, 1966, by Kiki Undies Corp. against Promenade Hosiery Mills, Inc. for trade-mark infringement under the Lanham Act, 15 U.S.C. § 1051 et seq., and unfair competition. On March 23, 1966, the plaintiff moved for summary judgment or, in the alternative, for a preliminary injunction, and on November 22, 1966, the district court entered an order denying the motions.¹ After trial the court entered judgment in which it dismissed both the plaintiff's complaint and prayer for an injunction against use of its Kiki trademark by the defendant and also the defendant's counterclaims and prayer for a declaration of its right to use such mark.²

There is no real dispute as to the facts. Plaintiff was incorporated in 1956 for the purpose of manufacturing and marketing nationally a lady's panty garment, for which plaintiff's president had obtained a patent based on novel design. Out of several hundred names submitted by an advertising agency, the name "Kiki" was selected as the name of the company as well as the trade-mark for the new product. The name "Kiki" was prominently displayed on plaintiff's business forms and letterhead.

Plaintiff hired a designer who created a distinctive product package, boldly displaying the label Kiki, which received the second place award in a 1956 design competition sponsored by the National Flexible Packaging Association. The label was copyrighted in December, 1956, for "women's undergarments" and the certificate of registration states that the label was first published and used on February 24, 1956. "Kiki" was registered by plaintiff as a trade-mark for ladies' panties in January, 1961. Since 1956 the plaintiff's products have carried a so-called "Kiki guarantee," which appears on each package of its goods.

During the same period, as the plaintiff's line of products has expanded, the word "Kiki" in various combinations has been employed on every item which the plaintiff has manufactured and sold. For example, about 1961 plaintiff began manufacturing and selling ladies' pajamas under the Kiki trade-mark. In March 1963, an additional and different line of panties was introduced and marketed under the registered trade-mark "Kiki Kontrol." In June 1963 plaintiff began selling ladies' girdles under the registered trade-mark "Kiki Magic." Since about 1959 plaintiff has sold, through department stores, a higher priced panty with the label "Kikini, exclusive design by Kiki Deluxe." At the time of trial it had in the design stage a line of panty hose to be distributed and sold under the Kiki mark.

More than 22,000,000 garments bearing the Kiki label were sold by the fiscal year ending April 30, 1966, and plaintiff's sales increased from about $250,000 in 1956 to about $1,800,000 in 1968. It spent over $400,000 during those years in advertising the name "Kiki" for ladies' garments; and, in addition, it engaged in cooperative advertising of its Kiki products with retail stores. Advertising expenditures, including cooperative ventures, now run to almost $100,000 per year.

Defendant is a sales corporation which markets headbands, tights, and hosiery manufactured by its sister corporation, Arjay Manufacturing Co., Inc. Arjay and the defendant share an office, but the defendant has no showroom, and, with one exception, no salesmen. It markets its products under varying arrangements. It puts its tights in a transparent package, similar in size and shape to that of the plaintiff, and sells them, either without any trade name or with only the name of the retail store customer, or with the name "Jaunties" and, since about June 7, 1965, with the name "Kiki," depending apparently on customer preference.

The court below found that the defendant's first use of the "Kiki" mark was in 1963. The record shows, however, that the only evidence on this question was the statement in the June 1966 deposition of Bell, one of the defendant's officers, that it had been used about a year, which means that the first use by defendant of "Kiki" in connection with tights was in June of 1965. The only evidence as to the date of the first use by defendant of the mark "Kiki" on headbands was that such use had begun by the date of the deposition, which was June 7, 1966. Thus, the record discloses that the plaintiff had used its trademark "Kiki" for nine years and that the mark had been registered for four years before defendant's first use.

On January 15, 1965 the defendant applied for a trade-mark registration of the mark "Kiki" for tights, swimwear and sportswear in Class 39, the same class in which the plaintiff's mark is registered. By letter dated June 4, 1965 the Patent Office refused registration "because the mark, as applied to the goods of the defendant so resembles the marks of plaintiff as to be likely to cause confusion, or to cause mistake, or to deceive * * *."

Title 15 U.S.C. § 1114(1) provides a remedy for trade-mark infringement against:

"any person who shall, without the consent of the registrant —

(a) use in commerce any reproduction * * * or colorable imitation of a registered mark in connection with the sale * * * of any goods * * on or in connection with which such use is likely to cause confusion, or to cause mistake, or to deceive * * *."

In denying the motions for summary judgment and a preliminary injunction, Judge Cooper was of the opinion that the plaintiff's registered Kiki trade-mark was "a strong mark," that plaintiff's and defendant's marks were "virtually identical," and that there was "likelihood of confusion as to the source of origin." 160 U.S.P.Q. 773, 774. Nevertheless, he denied the motions because "* * * plaintiff * * * fails to show its own interest in precluding defendant's use, defendant's bad faith, or instances of actual confusion." 160 U.S.P.Q. at 774.

The decision after the trial (MacMahon, Judge) rested on the following grounds: that the products of the plaintiff and the defendant were only remotely related; that the plaintiff failed to prove that its products and those of the defendant were marketed through the same outlets; that the evidence was insufficient to support a finding of actual confusion; and that, in the absence of proof by the plaintiff of intent on the part of the defendant to obtain a free ride, the court could not find that the defendant acted in bad faith. We are of the opinion that these conclusions rest upon findings not reasonably supported by the evidence or are erroneous in their assumptions of law.

This court in the case of Polaroid Corporation v. Polarad Electronics Corp., 287 F.2d 492, 495 (2 Cir. 1961), adopted a method of approach to the decision of trade-mark cases dealing with non-competitive products, where the prior owner's right to enjoin use of a similar mark was at issue. It called for the consideration of various factors: the strength of the mark; the degree of similarity between the two marks; the proximity of the products; the likelihood that the prior owner would bridge the gap; actual confusion, the reciprocal of the defendant's good faith in adopting its own mark; the quality of defendant's product; and the sophistication of the buyers. The court went on to say that this was not an exclusive or definitive catalogue but, where circumstances required, the court might have to take still other variables into account. This method of dealing with such cases was reaffirmed in Triumph Hosiery Mills, Inc. v. Triumph Internat'l Corp., 308 F.2d 196, 198 (2 Cir. 1962).

These factors are variable and relative and no single one, because of its presence or absence, is, in itself, determinative of a case. Rather, the method of approach requires the trial court to consider and weigh the evidence relative to each of these points and such other points as, in the particular circumstances before it, the court finds applicable; then, from a balancing of the conclusions reached on all of these factors, the court decides whether or not the parties are entitled to the relief or protection sought. The Polaroid approach was followed in Chandon Champagne Corporation v. San Marino Wine Corporation, 335 F.2d 531 (2 Cir. 1964); and in that case the court in addition to the Polaroid items considered the nature of the prior owner's priority; the prior owner's delay in asserting his claim; and the harm to the defendant as against the benefit to the plaintiff.

A review of the Polaroid dec...