Money Savers Pharmacy, Inc. v. Koffler Stores (Western) Ltd.

• Decision Date: 21 May 1984
• Docket Number: No. 11548-1-I,11548-1-I
• Citation: 682 P.2d 960,37 Wn.App. 602
• Parties: MONEY SAVERS PHARMACY, INC., Appellant, v. KOFFLER STORES (WESTERN) LTD., Respondent.
• Court: Washington Court of Appeals

Page 602

37 Wn.App. 602

682 P.2d 960

MONEY SAVERS PHARMACY, INC., Appellant, v. KOFFLER STORES (WESTERN) LTD., Respondent.

No. 11548-1-I.

Court of Appeals of Washington Division 1.

May 21, 1984.

Rehearing Denied Aug. 31, 1984.

Karr, Tuttle, Koch, Campbell, Mawer & Morrow, P.S., Floyd L. Newland, Christopher W. Moore, Seattle, for appellant.

Helsell, Fetterman, Martin, Todd & Hokanson, Arden J. Olson, John E. Ederer, Linda J. Cochran, Ragan L. Powers, Seattle, for respondent.

ANDERSEN, Judge.

FACTS OF CASE

This is an action for unfair competition based on a claim of trade name infringement. A summary judgment dismissing the action was entered in the Superior Court. We reverse and remand.

The plaintiff, Money Savers Pharmacy, Inc., brought this action against the defendant, Koffler Stores (Western) Ltd. Plaintiff alleged that the defendant wrongfully used a name similar to its trade name and that such conduct caused confusion to the public between the identity of its business and the defendant's business. Plaintiff sought injunctive relief and damages as well as attorneys' fees and costs.

The superior court granted a summary judgment to the defendant holding that: (a) the plaintiff had no actionable claim under the Consumer Protection Act, RCW 19.86; and (b) there was no genuine issue as to any material fact relating to the plaintiff's common law unfair competition claim and the defendant was entitled to a judgment thereon as a matter of law. CR 56.

The basic evidentiary facts are undisputed. In September of 1976 the plaintiff began doing business at its Edmonds location under the name "Money Savers Pharmacy and Gift Shop". ¹ In advertising this store, the names "Money Saver Pharmacy", "Money Savers Pharmacy", "Money Saver's Pharmacy", "Money Savers RX", and "Money Saver RX" are used interchangeably. ² The plaintiff's advertisements appear approximately monthly in an insert circular in the Edmonds Enterprise newspaper, as well as in telephone directories, on coupons, fliers and handbills, as well as in radio advertising.

In late 1979, the defendant opened its first Washington outlet in the Alderwood Mall in Lynnwood, under the name "Shoppers Drug Mart". By mid-1981 the defendant operated five outlets in southern Snohomish County and northern King County. ³

As a part of the defendant's regular advertising campaign, it publishes an advertising circular entitled "The Shoppers Drug Mart Money Saver" in the Edmonds area on about a monthly basis. On each page of the circular, it identifies the defendant's business as "The Shoppers Drug Mart". Since at least 1981, the circular has contained a map locating each of the defendant's five stores in the area. In its radio advertisements, the defendant also uses the words "Moneysaver Event" to promote certain of its store's sales. No intent on the part of the defendant to take away the plaintiff's customers or to confuse the public is claimed.

Plaintiff's two owners and one of its employees recounted by affidavit numerous customer uncertainties resulting from these various advertisements. Attached to the affidavits are copies of notes chronicling these customer reactions which were made by the plaintiff's employees and owners during a given period, June 1981 to February 1982. Several customers came to the plaintiff's store expecting to find certain products as advertised in the defendant's circular. One such customer wondered why the defendant's advertisement had not listed the address of the plaintiff's store along with the maps of the locations of the other five stores. Some of them thought that the defendant's stores and the plaintiff's store were branches of the same business.

After considering these and other affidavits, the trial court concluded: (a) that the requisite public interest to support the Consumer Protection Act claim was lacking and (b) that there was no genuine dispute as to any likelihood of confusion between the businesses. Summary judgment was granted to the defendant in all respects and the plaintiff's action was dismissed.

Following a denial of the plaintiff's motion for reconsideration, this appeal was taken. The appeal presents two issues.

ISSUES

ISSUE ONE. Did the trial court err by concluding that summary judgment was proper on the issue of the tendency of the public to be confused by the defendant's use of the words "Money Saver"?

ISSUE TWO. Did the trial court err by concluding that there was no Consumer Protection Act claim and that summary judgment on that issue was therefore appropriate?

DECISION

ISSUE ONE.

CONCLUSION. In opposition to the defendant's motion for summary judgment, the plaintiff set forth a number of specific instances of customer reaction of such nature as to raise a sufficient inference that the defendant's use of the words "Shoppers Drug Mart Money Saver" tends to confuse, mislead or deceive the public as to the identity of the two businesses. Summary judgment, therefore, should not have been granted on the plaintiff's common law claim of unfair competition based on the use of a trade name. CR 56.

Guidelines for our consideration of this issue are as follows:

In the case of Seattle, etc. Ass'n v. Amalgamated Ass'n, etc., 3 Wn. (2d) 520, 101 P. (2d) 338 (1940), we reviewed extensively our previous decisions involving the right to use a trade name and adopted therein eight rules of law for guidance in trade name cases. These rules were later cited in Foss v. Culbertson, 17 Wn. (2d) 610, 136 P. (2d) 711 (1943). We deem it advisable for the purpose of this appeal to again state these rules, which are as follows:

"First: The right to use a particular name as a trade name belongs to the one who first appropriates and uses it in connection with a particular business."

"Second: A person, whether individual or corporate, may not use any name, not even his or its own, which is the distinctive feature of a trade name already in use by another, if such use by the one person tends to confuse, in the public mind, the business of such person with that of the other."

"Third: The prior user may be entitled to relief regardless of actual fraud or intent to deceive on the part of a subsequent appropriator."

"Fourth: To acquire the right to use a particular name, it is not necessary that the name be used for any considerable length of time. It is enough to show that one was in the actual use of it before it was begun to be used by another."

"Fifth: A trade name may be abandoned or given up by the original appropriator, and, when it is so abandoned or given up, any other person has the right to seize upon it immediately, and make use of it, and thus acquire a right to it superior not only to the right of the original user, but of all the world."

"Sixth: A trade name, in order to be an infringement upon another, need not be exactly like it in form and sound. It is enough if the one so resembles another as to deceive or mislead persons of ordinary caution into the belief that they are dealing with the one concern when in fact they are dealing with the other."

"Seventh: The rule is no different when the name, or some part thereof, is a geographical name, or contains descriptive words which have acquired a secondary meaning."

"Eighth: Prior right to the use of a name will be protected by injunction against others using it unfairly."

Holmes v. Border Brokerage Co., 51 Wash.2d 746, 750-51, 321 P.2d 898 (1958).

Pursuant to these rules "[t]he plaintiff in a trade name infringement action must establish that defendant has infringed on the distinctive feature of his name in a manner that 'tends to confuse in the public mind' the two businesses." Puget Sound Rendering, Inc. v. Puget Sound By-Products, 26 Wash.App. 724, 728, 615 P.2d 504 (1980). "The underlying concept is that of unfair competition in matters in which the public generally may be deceived or misled", Seattle St. Ry. & Mun. Employees Relief Ass'n v. Street, Elec. Ry. & Motor Coach Employees, 3 Wash.2d 520, 534, 101 P.2d 338 (1940), with the universal test question being "whether the public is likely to be deceived", Olympia Brewing Co. v. Northwest Brewing Co., 178 Wash. 533, 538, 35 P.2d 104 (1934).

Although proof of actual confusion is not required to sustain a claim for trade name infringement, see Holmes, 51 Wash.2d at 750-51, 321 P.2d 898, evidence of actual confusion indicating public confusion by the name similarity may be relied on to establish that injunctive relief is warranted. See Puget Sound Rendering, 26 Wash.App. at 728-29, 615 P.2d 504; Seattle Employees, 3 Wash.2d at 528, 101 P.2d 338; Foss v. Culbertson, 17 Wash.2d 610, 616, 136 P.2d 711 (1943).

Whether or not there has been unfair competition is a question of fact. Olympia Brewing Co., 178 Wash. at 538, 35 P.2d 104; Foss, 17 Wash.2d at 623, 136 P.2d 711. Accord, Evergreen St. Amusement Co. v. S.F. Burns & Co., 2 Wash.App. 416, 422-23, 468 P.2d 460 (1970). See also Seattle Employees, 3 Wash.2d at 523, 101 P.2d 338. Even where the evidentiary facts are undisputed, if reasonable minds could draw different conclusions from those facts, then summary judgment is not proper. Fleming v. Stoddard Wendle Motor Co., 70 Wash.2d 465, 467, 423 P.2d 926 (1967).

Therefore, in reviewing the Superior Court's order of summary judgment in this case,

we must engage in the same inquiry as the trial court.... A summary judgment motion under CR 56(c) can be granted only if the pleadings, affidavits, depositions, and admissions on file demonstrate there is no genuine issue as to any material fact, and that the moving party is entitled to judgment as a matter of law.... The court must consider all facts submitted and all reasonable inferences from the facts in the light most favorable to the nonmoving party.

(Citations omitted.) Wilson v. Steinbach, 98 Wash.2d 434, 437, 656 P.2d 1030 (1982). In order to preclude summary judgment the nonmoving party

must set forth specific facts that sufficiently rebut...