National Nu Grape Co. v. Guest, 3488.

• Decision Date: 10 December 1947
• Docket Number: No. 3488.,3488.
• Citation: 164 F.2d 874
• Parties: NATIONAL NU GRAPE CO. v. GUEST.
• Court: U.S. Court of Appeals — Tenth Circuit

164 F.2d 874 (1947)

NATIONAL NU GRAPE CO. v. GUEST.

No. 3488.

Circuit Court of Appeals, Tenth Circuit.

November 5, 1947.

Rehearing Denied December 10, 1947.

Ernest P. Rogers, of Atlanta, Ga. (Troy Shelton, of Oklahoma City, Okl., Smith, Kilpatrick, Cody, Rogers & McClatchey, of Atlanta, Ga., and Embry, Johnson, Crowe, Tolbert & Shelton, of Oklahoma City, Okl., on the brief), for appellant.

F. M. Dudley, of Oklahoma City, Okl., for appellee.

Before PHILLIPS, BRATTON and HUXMAN, Circuit Judges.

HUXMAN, Circuit Judge.

This was an action by the National NuGrape Company, herein referred to as NuGrape, against James D. Guest, trading and doing business variously as Tot Beverage Company, and Tru-Grape Company, herein referred to as Guest, for alleged infringement of NuGrape's registered trademark and for unfair competition. From a judgment in favor of Guest, NuGrape has appealed.

The facts are not in dispute. NuGrape is a Georgia corporation, located in Atlanta, Georgia. It and its predecessor have been manufacturing and marketing a carbonated grape drink since 1921, under the registered trade-mark of NuGrape. NuGrape, exclusive of its predecessor, has expended more than $800,000 in advertising its beverages, all of which advertising featured the trade-mark NuGrape, and sells its product under that name in a majority of the states of the United States, including the State of Oklahoma. Its sales have aggregated more than $5,000,000. The trade name NuGrape was registered in 1923, in the United States Patent Office under the Federal Trade-Mark Act of February 20, 1905, 15 U.S.C.A. § 81 et seq. On August 29, 1939, NuGrape registered its trade-mark with the Secretary of State of Oklahoma, and received as of that date a certificate to that effect.

Guest has, since 1942, been engaged in manufacturing and marketing a grape drink under the name Tru-Grape, which he represents as a valid trade-mark for his product. His principal place of business is located at Duncan, Oklahoma, and his trade territory is largely the southeastern part of Oklahoma and Texas. In 1942, the defendant registered his trade-mark with the Secretary of State of Oklahoma. NuGrape protested the use of the name of Tru-Grape by Guest as being an infringement of its trade-mark, but to no avail. Prior to the institution of this suit, NuGrape sent two representatives into Guest's trade territory, who, in the guise of customers, called upon the dealers in various towns and ordered either NuGrape or Tru-Grape. In about one-fourth of the places at which they called, they were served one drink though they had asked for the other.

The trial court found that the consuming public was not confused in purchasing either of these drinks, and that while a mistake might be made when all reliance was placed on pronunciation, the bottles are totally different in size, shape and appearance, and the tops are not similar; that the arrangement, color, design and general appearance of the labels and markings on the Tru-Grape bottles are in marked contrast to those of NuGrape, so that a customer would recognize instantly that he had not received what he had asked for if served a Tru-Grape on an order for NuGrape, or vice versa. The trial court concluded, as a matter of law, that the term NuGrape was not a valid trade-mark because it was descriptive of the product; that it was doubtful whether it had acquired a secondary meaning since the evidence showed its significance to the public mind was only in the kind of product rather than its source; but regardless of whether it had acquired a secondary meaning, plaintiff failed to show facts justifying an inference of unfair trade practices in Guest's use of the term "Tru-Grape". A decree was accordingly entered for Guest from which this appeal is prosecuted.

It is well established that the mere registration of a term as a trade-mark does not establish that term as a valid trade-mark. Registration gives rise to a presumption of validity but such presumption is rebuttable. When a trade-mark is questioned, its validity must be established. It has long been recognized that a registered trade-mark is not valid when the term used is merely descriptive of the product, or of its ingredients, qualities or characteristics.¹ The gist or value of the trade-mark is to signify the origin or source of a product; to provide a symbol for the article to aid the manufacturer in advertising and selling. A descriptive mark is bad for two reasons: First, because it does not advise the public that the article comes from a single source; and, second, that if so, since the word is descriptive of the goods, the protection of the word as a trade-mark would be an infringement upon common speech, which, in the use of the word, likewise is descriptive.²

The term in controversy here, "NuGrape", is made up of the words "new" misspelled, and "grape". The cases dealing with such words, and with words alleged to be an infringement on their use, are legion and no particular purpose would be served in citing them or in analyzing the facts therein.³ The...