Pletz v. Christian Herald Association, 72-1923.

• Decision Date: 15 November 1973
• Docket Number: No. 72-1923.,72-1923.
• Citation: 486 F.2d 94
• Parties: Alice PLETZ and Rennert Travel Service, Inc., Plaintiffs-Appellees, v. CHRISTIAN HERALD ASSOCIATION, INC., Defendant-Appellant.
• Court: U.S. Court of Appeals — Fifth Circuit

486 F.2d 94 (1973)

Alice PLETZ and Rennert Travel Service, Inc., Plaintiffs-Appellees, v. CHRISTIAN HERALD ASSOCIATION, INC., Defendant-Appellant.

No. 72-1923.

United States Court of Appeals, Fifth Circuit.

October 23, 1973.

Rehearing Denied November 15, 1973.

Joe P. Smyer, San Antonio, Tex., for defendant-appellant.

Franklin D. Houser, Gordon W. Jones, Jr., San Antonio, Tex., for plaintiffs-appellees.

Before JONES, GODBOLD and INGRAHAM, Circuit Judges.

INGRAHAM, Circuit Judge:

This is a Texas diversity case arising out of the breach of an alleged exclusive agency agreement between defendant-appellant Christian Herald Association, Inc., and the plaintiffs-appellees Alice Pletz and Rennert Travel Service, Inc. Plaintiff Pletz operates the Rennert Travel Service, Inc., located in San Antonio, Texas. Mrs. Pletz has been engaged in the travel service business since the latter part of 1949. Beginning in 1960, Mrs. Pletz began to operate religiously oriented tours in conjunction with several religious organizations.

The defendant Christian Herald was incorporated as a non-profit organization in New York. From its conception, the Christian Herald Association has published a layman's magazine entitled "The Christian Herald Magazine" and serves as a central agency for religiously oriented travel tours.

This case was tried before a jury and it returned a verdict for the plaintiffs in the amount of $51,250. We affirm as to Christian Herald's liability in this case, but reverse and remand on damages.

The first issue before us is whether the district court properly submitted to the jury the issue on the existence of an exclusive agency relationship. Although there was no formal agreement between the parties, the plaintiffs introduced several letters in an attempt to establish the exclusive agency relationship. The trial court apparently determined that an agency relationship existed, but submitted to the jury the issue whether there was an exclusive agency relationship.

It is true that the interpretation of a clear and unambiguous written instrument is a question of law for the court to decide. Hennigan v. Chargers Football Co., 431 F.2d 308, 314 (5th Cir., 1970); City of Pinehurst v. Spooner Add'n. Water Co., 432 S.W.2d 515, 518 (Tex.1968). The court, however, may conclude that the instrument is ambiguous and thus allow the jury to resolve the ambiguity by determining the underlying intent of the parties as a matter of fact. Trinity Universal Ins. Co. v. Ponsford Bros., 423 S.W.2d 571 (Tex.1968). A close examination of the correspondence here in question reveals that the instruments were ambiguous regarding the exclusiveness of the agency relationship. The language of the letters was capable of more than one meaning. Jones v. Home Transp. Co., 422 F. 2d 179, 181 (5th Cir., 1970). The court properly submitted this issue to the jury.

Whether the court erred in submitting to the jury the issue of service mark infringement is the second issue before us. Mrs. Pletz, on breach of the exclusive agency agreement, was compelled to organize her own tours in an attempt to avoid financial disaster. Mrs. Pletz was unable to promptly obtain letterheads with an original design for use in her business and, therefore, had temporary letterheads printed bearing the ship, train, airplane and world emblem used by Christian Herald on its stationery. Plaintiffs introduced evidence of other travel agency advertisements showing the wide use of these insignia by other agencies.

As an element of proving service mark infringement, the proponent must demonstrate that the similarity between the marks would mislead and confuse the public. American Foods, Inc. v. Golden Flake, Inc., 312 F.2d 619, 623 (5th Cir., 1963). The question of consumer confusion is one of fact to be determined by the jury. Id. at 624. Accordingly, the jury's determination in this case that there was no confusing or deceptive similarity is amply supported by the evidence.

Appellant's final contention is that the award of $51,250 damages is excessive and unsupported by the evidence. The objective in awarding damages, of course, is to place the injured party in a position as good as if the contract had been fully performed. 5 A. Corbin, Contracts § 1002, at 31 (1964). More specifically, Mrs. Pletz is entitled to the net commissions paid to the other agents with whom Christian Herald began to organize tours plus out-of-pocket expenditures made in reliance on performance of the contract. See C. Mc-Cormick, Damages 585 (1940). See generally Boyle v. Bond, 88 U.S.App.D. C. 178, 187 F.2d 362, 363 (1951); Park v. Swartz, 110 Tex. 564, 222 S.W. 156 (1920); Carrico v. Stevenson, 135 S.W. 260 (Tex.Civ.App.1911, no writ). Whether this measure of damages has been exceeded is therefore the essential issue.

Our scope of review of jury damage awards is narrow. Absent a clear abuse of discretion in denying a motion for new trial, we must adhere to the jury's determination. When the evidence as shown in the record, however, is insufficient to support the award, the jury's award would be erroneous and a new trial must be had. Ward v. Buehler, 472 F.2d 1170, 1171 (5th Cir., 1973); Glazer v. Glazer, 374 F.2d 390, 413 (5th Cir., 1967), cert. den., 389 U.S. 831, 88 S.Ct. 100, 19 L.Ed.2d 90; Whiteman v. Pitrie, 220 F.2d 914, 919 (5th Cir., 1955); Wright & Miller, Federal Practice and Procedure § 2820 (1973).

It is therefore necessary to consider the sufficiency of the evidence underlying the jury's award of damages. In conducting a...