Polaroid Corporation v. Polarad Electronics Corp.

• Court: United States Courts of Appeals. United States Court of Appeals (2nd Circuit)
• Citation: 287 F.2d 492
• Docket Number: No. 162,Docket 26460.,162
• Parties: POLAROID CORPORATION, Plaintiff-Appellant, v. POLARAD ELECTRONICS CORPORATION, Defendant-Appellee.
• Decision Date: 28 February 1961

287 F.2d 492 (1961)

POLAROID CORPORATION, Plaintiff-Appellant,
v.
POLARAD ELECTRONICS CORPORATION, Defendant-Appellee.

No. 162, Docket 26460.

United States Court of Appeals Second Circuit.

Argued January 17, 1961.

Decided February 28, 1961.

287 F.2d 493

Donald L. Brown, Cambridge, Mass. (Silver, Saperstein & Barnett, and Isaac M. Barnett, New York City, Tracy R. V. Fike, Scarsdale, N. Y., and Herbert S. Kassman, Cambridge, Mass., on the brief), for plaintiff-appellant.

Morris Relson, New York City (Darby & Darby and Howard C. Miskin, New York City, on the brief), for defendant-appellee.

Before MEDINA, FRIENDLY and SMITH, Circuit Judges.

FRIENDLY, Circuit Judge.

Plaintiff, Polaroid Corporation, a Delaware corporation, owner of the trademark Polaroid and holder of 22 United States registrations thereof granted between 1936 and 1956 and of a New York registration granted in 1950, brought this action in the Eastern District of New York, alleging that defendant's use of the name Polarad as a trademark and as part of defendant's corporate title infringed plaintiff's Federal and state trademarks and constituted unfair competition. It sought a broad injunction and an accounting. Defendant's answer, in addition to denying the allegations of the complaint, sought a declaratory judgment establishing defendant's right to use Polarad in the business in which defendant was engaged, an injunction against plaintiff's use of Polaroid in the television and electronics fields, and other relief. Judge Rayfiel, in an opinion reported in D.C.1960, 182 F. Supp. 350, dismissed both the claim and the counterclaims, concluding that neither plaintiff nor defendant had made an adequate showing with respect to confusion and that both had been guilty of laches. Both parties appealed but defendant has withdrawn its cross-appeal. We find it unnecessary to pass upon Judge Rayfiel's conclusion that defendant's use of Polarad does not violate any of plaintiff's rights. For we agree that plaintiff's delay in proceeding against defendant bars plaintiff from relief so long as defendant's use of Polarad remains as far removed from plaintiff's primary fields of activity as it has been and still is.

The name Polaroid was first adopted by plaintiff's predecessor in 1935. It has

287 F.2d 494

been held to be a valid trademark as a coined or invented symbol and not to have lost its right to protection by becoming generic or descriptive, Marks v. Polaroid Corp., D.C.D.Mass.1955, 129 F.Supp. 243. Polaroid had become a well known name as applied to sheet polarizing material and products made therefrom, as well as to optical desk lamps, stereoscopic viewers, etc., long before defendant was organized in 1944. During World War II, plaintiff's business greatly expanded, from $1,032,000 of gross sales in 1941 to $16,752,000 in 1945, due in large part to government contracts. Included in this government business were three sorts on which plaintiff particularly relies, the sale of Schmidt corrector plates, an optical lens used in television; research and development contracts for guided missiles and a machine gun trainer, both involving the application of electronics; and other research and development contracts for what plaintiff characterizes as "electro-optical devices employing electronic circuitry in combination with optical apparatus." In 1947 and 1948 plaintiff's sales declined to little more than their pre-war level; the tremendous expansion of plaintiff's business, reaching sales of $65,271,000 in 1958, came after the development of the Land camera in 1948

Defendant was organized in December, 1944. Originally a partnership called Polarad Electronics Co., it was converted in 1948 into a New York corporation bearing the name Polarad Television Corp., which was changed a year later to Polarad Electronics Corp. Its principal business has been the sale of microwave generating, receiving and measuring devices and of television studio equipment. Defendant claimed it had arrived at the name Polarad by taking the first letters of the first and last names of its founder, Paul Odessey, and the first two letters of the first name of his friend and anticipated partner, Larry Jaffe, and adding the suffix "rad," intended to signify radio; however, Odessey admitted that at the time he had "some knowledge" of plaintiff's use of the name Polaroid, although only as applied to glasses and polarizing filters and not as to electronics. As early as November, 1945, plaintiff learned of defendant; it drew a credit report and had one of its attorneys visit defendant's quarters, then two small rooms; plaintiff made no protest. By June, 1946, defendant was advertising television equipment in "Electronics" — a trade journal. These advertisements and other notices with respect to defendant came to the attention of plaintiff's officers; still plaintiff did nothing. In 1950, a New York attorney who represented plaintiff in foreign patent matters came upon a trade show display of defendant's television products under the name Polarad and informed plaintiff's house counsel; the latter advised plaintiff's president, Dr. Land, that "the time had come when he thought we ought to think seriously about the problem." However, nothing was done save to draw a further credit report on defendant, although defendant's sales had grown from a nominal amount to a rate of several hundred thousand dollars a year, and the report related, as had the previous one, that defendant was engaged "in developing and manufacturing equipment for radio, television and electronic manufacturers throughout the United States." In October, 1951, defendant, under its letterhead, forwarded to plaintiff a letter addressed to "Polarad Electronics Corp." at defendant's Brooklyn address, inquiring in regard to "Polaroid material designed for night driving"; there was no protest by plaintiff. In 1953, defendant applied to the United States Patent Office for registration of its trademark Polarad for radio and television units and other electronic devices; in August, 1955, when this application was published in the Official Gazette of the Patent Office, plaintiff for the first time took action by filing a notice of opposition, which was overruled by the Examiner in April, 1957. Still plaintiff delayed bringing suit until late 1956. Through all this period defendant was expending considerable sums for advertising and its business was growing — employees increasing

287 F.2d 495

from eight in the calendar year 1945 to 530 in the year ended June 30, 1956, fixed assets from $2,300 to $371,800, inventories from $3,000 to $1,547,400, and sales from $12,000 to $6,048,000

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