Popular Bank of Fla. v. Banco Popular Puerto Rico

• Decision Date: 05 June 1998
• Docket Number: No. 97-2751-CIV.,97-2751-CIV.
• Citation: 9 F.Supp.2d 1347
• Parties: POPULAR BANK OF FLORIDA, a Florida corporation, Plaintiff, v. BANCO POPULAR DE PUERTO RICO, and Banco Popular N.A. (Florida), Defendants.
• Court: U.S. District Court — Southern District of Florida

9 F.Supp.2d 1347

POPULAR BANK OF FLORIDA, a Florida corporation, Plaintiff, v. BANCO POPULAR DE PUERTO RICO, and Banco Popular N.A. (Florida), Defendants.

No. 97-2751-CIV.

United States District Court, S.D. Florida.

June 5, 1998.

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Mitchell H. Stabbe, Erik Phelps, Dow, Lohnes & Albertson, P.L.L.C., Washington, DC, Leslie J. Lott, Lott & Friedland, P.A., Coral Gables, FL, for Plaintiff.

Hugo L. Black, Jr., Joseph W. Beasley, Kelly, Black, Black, Byrne & Beasley, P.A., Miami, FL, Alan S. Cooper, Eric T. Fingerhut, David J. Cho, Kelly C. Maynard, Shaw, Pittman, Potts & Trowbridge, Washington, DC, for Defendants.

ORDER GRANTING PLAINTIFF'S MOTION FOR PRELIMINARY INJUNCTION

GOLD, District Judge.

Popular Bank of Florida asks this Court to grant a preliminary injunction prohibiting Banco Popular de Puerto Rico and Banco Popular N.A. (Florida) from using the marks Banco Popular or Popular Express, in Dade, Broward, Monroe, and Palm Beach Counties.¹ The critical inquiry before the Court is whether Popular Bank of Florida has demonstrated a substantial likelihood of success on the merits by showing that its rights to the mark are prior and superior and that defendants' use of the mark Banco Popular or Popular Express is likely to cause consumer confusion.

I. FACTS

Popular Bank of Florida is a full-service commercial bank which specializes in international correspondent banking, personal banking, and domestic mortgage lending. Over 100 people are currently employed in Popular Bank's two Miami offices. At the end of 1996, Popular Bank had assets of $310.1 million. Popular Bank has been providing financial and banking services under the name Popular Bank of Florida since 1979. Plaintiff registered its Popular Bank of Florida service mark with the Florida Secretary of State in 1990. In the six-year period prior to 1979, Popular Bank of Florida had been operating under the name and service mark Popular Bank of Hialeah.

Banco Popular de Puerto Rico is a full-service commercial bank headquartered in Puerto Rico. With over $15.08 billion in assets, Banco Popular de Puerto Rico is the largest bank in Puerto Rico, and clearly dwarfs Popular Bank of Florida in terms of size and assets. Banco Popular has been rendering banking and financial services in Puerto Rico since 1893. Banco Popular N.A., the owner of Banco Popular de Puerto Rico, is a national banking association, owned by Popular Corporation, a holding company under the laws of the territory of Puerto Rico. Currently, Banco Popular has a network of 56 banks located in Chicago, New York, Dallas, Los Angeles, and Orlando. Defendants registered the mark Banco Popular with the United States Patent and Trade Office (PTO) and a Certificate of Registration was issued in March, 1995.

In late 1996, Banco Popular initiated a marketing campaign to increase its recognition in the Hispanic community on the continental United States. In January, 1997, it hired as its spokesperson, Don Mario Kreutzberger, well-known in the Hispanic community as Don Francisco, host of the popular Spanish-language variety program entitled "Sabado Gigante." Four television commercials were created for Banco Popular to be shown on "Sabado Gigante" in cities with substantial Hispanic television audiences including Miami. A goal of the television advertising campaign was to promote the Banco Popular name and mark in Florida.

In May 1997, Banco Popular acquired Seminole National Bank, which has its principal place of business in Sanford, Florida and operates three branches in Sanford and Orlando, Florida. Defendants changed the name of Seminole National Bank to "Banco Popular." In October, 1997, Banco Popular acquired twelve established check-cashing facilities in Miami. Applications for approval to operate the outlets were submitted to the Federal Reserve Bank and the Department of Banking and Finance of the State of Florida. Banco Popular plans to operate these check-cashing facilities under the name "Popular Cash Express." Popular Bank argues that the customer confusion generated by Banco Popular's television commercials has been immense. In the months following the initial broadcast of the commercials, Popular Bank received thousands of phone calls from consumers seeking the banking services of Banco Popular De Puerto Rico.

The complaint seeks injunctive relief and damages under several causes of action including: (1) service mark infringement under section 43(a) of the Lanham Act, 15 U.S.C. section 1115(a); (2) unfair competition in violation of section 43(a) of the Lanham Act, 15 U.S.C. section 1125(a); (3) unlawful dilution of the plaintiff's service marks in violation of section 43(c) of the Lanham Act, 15 U.S.C. section 1125(c); and (4) service mark infringement and unfair competition under Florida common law. Plaintiff seeks to enjoin the defendants from using the name or mark "Banco Popular" or any other mark, such as Popular Express, in Broward, Dade, and Monroe counties. Popular Bank contends that it is entitled to an injunction to prevent "reverse" confusion. According to plaintiff, its reputation and good will is threatened because customers who have seen the television commercials contact Popular Bank in order to obtain the services advertised by Banco Popular and become disappointed and angry at Popular Bank when informed that those services are not available.

On May 1, 1998, the Court held a hearing on plaintiff's motion for preliminary injunction at which time the parties presented evidence concerning the issues of priority of use, the validity of the mark, and whether the defendants' trademark is the same or confusingly similar to the plaintiff's mark Popular Bank so as to confuse consumers about the origin of the goods or services.

II. LEGAL STANDARD FOR PRELIMINARY INJUNCTION

A party seeking a preliminary injunction must demonstrate: (1) a substantial likelihood of success on the merits; (2) irreparable harm should the injunction not be granted; (3) the threatened injury to the plaintiff outweighs any potential harm to the defendant; and (4) granting the injunction would not be adverse to the public interest. Canal Authority v. Callaway, 489 F.2d 567, 572 (5th Cir.1974). See also Warren Pub. Inc. v. Microdos Data Corp., 115 F.3d 1509 (11th Cir.1997); Haitian Refugee Ctr., Inc. v. Nelson, 872 F.2d 1555, 1561-62 (11th Cir. 1989). The issuance of a preliminary injunction is an extraordinary equitable remedy which should not be granted absent a clear showing that the moving party has met its burden of proof. Cafe 207 v. St. Johns County, 989 F.2d 1136, 1137 (11th Cir.1993). Preserving the court's ability to render a meaningful decision after a trial on the merits is the primary justification for granting a preliminary injunction. Tefel v. Reno, 972 F.Supp. 623, 633 (S.D.Fla.1997). Findings made on an application for preliminary injunction are not controlling at a later hearing on a permanent injunction. E. Remy Martin & Co. v. Shaw-Ross Int'l Imports, Inc., 756 F.2d 1525, 1527 n. 1 (11th Cir.1985). With these basic principles in mind, the Court now turns to the merits of the preliminary injunction application in this case.

LIKELIHOOD OF SUCCESS ON THE MERITS

Under either the common law or statutory law, the principles of trademark infringement are the same. Tally-Ho, Inc. v. Coast Community College Distr., 889 F.2d 1018, 1025-26 (11th Cir.1989). A defendant is liable for trademark infringement if, without the consent of a prior user or registrant, he uses "in commerce any reproduction, counterfeit, copy, or colorable imitation of a registered mark" which is likely to cause confusion. John H. Harland Co. v. Clarke Checks, Inc., 711 F.2d 966, 972 (11th Cir.1983)(quoting 15 U.S.C. section 1114(1)(a)). To prevail in a trademark infringement action, the plaintiff must show three things: first, that it was the first to use the trademark in the same market; second, that its mark is valid; and third, that the defendant's use of the contested mark is likely to confuse consumers. Dieter v. B & H Indus. of S.W. Fla., Inc., 880 F.2d 322, 326 (11th Cir.1989); Burger King Corp. v. Mason, 710 F.2d 1480, 1491 (11th Cir.1983). See also Lone Star Steakhouse & Saloon, Inc. v. Longhorn Steaks, Inc., 106 F.3d 355, 360 (11th Cir.1997); Investacorp, Inc. v. Arabian Investment Banking Corp. (Investcorp) E.C., 931 F.2d 1519, 1521 (11th Cir.1991); American Television and Communications Corporation v. American Communications and Television, Inc., 810 F.2d 1546, 1548 (11th Cir.1987); Conagra, Inc. v. Singleton, 743 F.2d 1508, 1512 (11th Cir.1984).

A. PRIORITY OF USE.

The right to the exclusive use of a particular mark or name as a trademark is ordinarily founded on priority of appropriation. Columbia Mill Co. v. Alcorn, 150 U.S. 460, 463-64, 14 S.Ct. 151, 37 L.Ed. 1144 (1893). The first to use a mark on a product or service in a particular geographic market acquires rights in the mark in that market. Tally-Ho, Inc., 889 F.2d at 1022-23. In this case, each party contends that it was first to use the mark. Priority of use therefore is a critical threshold issue which must be resolved before the issues of validity and likelihood of confusion are addressed. See Lone Star Steakhouse & Saloon, Inc., 106 F.3d at 360.

Banco Popular alleges that it is a famous and well-known bank that has been operating in Puerto Rico under the trade name and service mark Banco Popular since 1893. It argues that it has superior trademark rights because it has been doing business in Florida for nearly thirty years, is well-known by those in the banking trade, and that South Florida is within its zone of natural expansion. Responding to Banco Popular's argument, Popular Bank contends that Banco Popular may be well-established in Puerto Rico, but it is a newcomer to the South Florida area.

In contrast, Popular Bank has been advertising and doing...