Railroad Salvage of Conn. v. Railroad Salvage, Inc.
| Decision Date | 11 April 1983 |
| Docket Number | No. 81-0365 S.,81-0365 S. |
| Citation | 561 F. Supp. 1014 |
| Parties | RAILROAD SALVAGE OF CONN., INC. v. RAILROAD SALVAGE, INC. and Geraldine Lemme. |
| Court | U.S. District Court — District of Rhode Island |
Fish & Richardson by William W. Rymer, John M. Skenyon, Providence, R.I., for plaintiff.
Richard A. Ciccone, Dennis S. Baluch, Providence, R.I., for defendants.
The plaintiff, spurred by a desire to salvage the good repute of its corporate name, instituted this action, pursuant to § 43(a) of the Lanham Act, 15 U.S.C. § 1125(a), and under common law trademark and trade name infringement, attempting thereby to punch the defendant's ticket, as it were. The complaint seeks injunctive and ancillary relief only; the plaintiff wants defendant to scrap the use of the name "Railroad Salvage". No claim is made for money damages or loss of profits. The matter is presently before the Court on the plaintiff's motion for summary judgment. Tracking this motion requires that the Court traverse the junkyard1 of trademark and trade name law. Before essaying this task, however, some description of the litigants and of their relative stations in life appears warranted.2 All aboard!
The story of the plaintiff is as American as Casey Jones.3 Some thirty-five years ago, the plaintiff's founder, Reuben W. Vine, borrowed one hundred dollars and began selling items out of a storefront emblazoned with the appellation "Freight Salvage." In those early years, Vine purchased undeliverable goods from railroads and trucking companies and sold this excess baggage to consumers at fares representing simultaneously a substantial discount to the purchaser and a substantial profit to the vendor. The venture proved sufficiently remunerative that Vine, several years hence but well before the defendant left the depot, rechristened the business "Railroad Salvage" and incorporated it in Connecticut as "Railroad Salvage of Conn., Inc." This took place in 1965; its headquarters was then located in Meriden, Connecticut. Affidavit of Reuben W. Vine ¶¶ 2, 4 (hereinafter "Vine Affidavit").
From these humble beginnings, Vine built up a head of steam and the corporation grew into a multi-million dollar business. As the train of events continued, the company no longer limited itself to purchasing undeliverable goods, but actively sought out merchandise sold in bankruptcy liquidations and discontinued or overstocked merchandise from more conventional sources. In pursuit of appropriate wares, the plaintiff now contacts possible suppliers throughout the United States; in turn, firms will contact the plaintiff when they believe they have merchandise suitable for the plaintiff's distribution requirements. Exhibit B, Vine Affidavit.
Vine has also expanded the retail portion of the business well beyond the storefront. Plaintiff operates a freight warehouse in Connecticut which supplies goods to four company stores (East Windsor, West Haven, and Groton, Connecticut and Turners Falls, Massachusetts). First Affidavit of Donald Roberge, ¶ 4 (hereinafter "Roberge I").
The focal point of this litigation is the Groton emporium, which is conveniently located only a few miles from the Rhode Island state line. To maximize sales and to take advantage of the Rhode Island market, the plaintiff advertises heavily in Rhode Island media.4 This promotion includes advertisements placed in daily newspapers of essentially statewide circulation within Rhode Island; and also includes the airing of television commercials on local Providence-area television stations, with sometimes exasperating echolalia. Plaintiff's exploitation of both print and electronic media prominently features the name "Railroad Salvage." Roberge I ¶ 5 and Exhibit A attached thereto. This media blitz has generated an impressive track record; sales were recorded of approximately four million dollars for the Groton store in fiscal year 1980. The plaintiff estimates that 40% of its customers at Groton are Rhode Islanders. Roberge I ¶ 7.
Bernard Werther, on the other hand, seemingly wanted to take the short ride down the main line to success. To this end, Werther became an entrepreneur and opened his own business. As compared to the conductor of plaintiff's enterprises, he can only be characterized as a mere trainee. In December of 1980, not more than a few weeks after a story about the plaintiff's swift rise from rags to riches was prominently displayed in the Providence Sunday Journal, Werther (his hopes apparently hoisted by plaintiff's accelerated time-table) incorporated "Railroad Salvage, Inc." in Rhode Island. He was sole shareholder and its general manager.5 Defendant's Answers to Plaintiff's Interrogatories (hereinafter "Interrogatories"), No. 5. The defendant's original railhead was located at 893 Post Road, Warwick, Rhode Island; later, the defendant chugged along to its present address, 22 Roseland Avenue, Warwick, Rhode Island. Id.
The defendant has three main lines of enterprise. As gauged by the Court, approximately 30%-40% of its business involves the assembling and jobbing of jewelry products. The sale of general merchandise at wholesale to flea market operators accounts for another 20% of the business. The remainder involves acting as a sales agent and wholesaler. As a spur line, the defendant generates approximately 1%-2% of its business from retail sales of pocket T-shirts and paint.6 Interrogatories, Nos. 1, 2, 3, 10 and 13.
In contradistinction to the plaintiff, the defendant has done only minimal advertising. The defendant did, however, place an advertisement in "Women's Wear Daily" announcing that it would purchase closeouts. Its other ties to media advertising are scant, and are detailed in discovery. Interrogatories, Nos. 8, 9. Although the record is not a model of clarity, this Court will assume arguendo that only the defendant's offer to purchase close-outs prominently displayed the name "Railroad Salvage". Interrogatories, Exhibit A.
The defendant has operated in a much more geographically limited area than does the plaintiff. The defendant has, however, used the name "Railroad Salvage" in business transactions in New York, Rhode Island, New Jersey, California, Massachusetts, Maryland, and Ohio. Interrogatories, No. 17. All of its retail sales took place in Rhode Island; it has not done business in Connecticut. Id.; see also Interrogatories, No. 2.
The plaintiff is a large, successful retailer which has ridden the monorail to prosperity. Its tracks are found throughout the United States. It is apparently well-known by companies desiring to liquidate inventories of goods not merchantable in more commonplace ways. While plaintiff does not conduct a retail business within Rhode Island, it has received extensive exposure therein and does a significant amount of traffic with Rhode Islanders.
In the jargon of the switchyard, the plaintiff is a locomotive, while the defendant is a dolley. The defendant's business appears to be moderately successful; it has some interstate contact. Given the paucity of the defendant's advertising budget and the narrow gauge of its endeavors, it seems inevitable that the general commercial and consumer public is far more aware of the plaintiff than of the defendant.
The plaintiff, having obtained relief pendente lite,7 has now moved for plenary summary judgment pursuant to Fed.R.Civ.P. 56. Plaintiff has filed a statement of undisputed facts, a memorandum of law in support of its motion for terminal relief, and has tendered several supporting affidavits (which, together with the discovery of record, comprises the platform upon which the motion is predicated). In its motion, the plaintiff seeks to make the injunction permanent and to secure an award of costs and attorneys' fees. The defendant has objected and has filed a brief.8
It is well settled that summary judgment can be engineered only where there is no genuine issue as to any material fact and where the movant is entitled to judgment as a matter of law. Emery v. Merrimack Valley Wood Products, Inc., 701 F.2d 985, at 986 (1st Cir.1983); Hahn v. Sargent, 523 F.2d 461, 464 (1st Cir.1975), cert. denied, 425 U.S. 904, 96 S.Ct. 1495, 47 L.Ed.2d 754 (1976); United Nuclear Corp. v. Cannon, 553 F.Supp. 1220, 1226 (D.R.I.1982); Milene Music, Inc. v. Gotauco, 551 F.Supp. 1288, 1292 (D.R.I.1982). In short, relief under Rule 56 is available only if the movant has demonstrated that the tracks are clear and that they run only in one direction. In determining whether such a trunk line to brevis disposition exists, this Court must view the record in the light most favorable to the party opposing the motion, Emery v. Merrimack Valley Wood Products, Inc., at 986; John Sanderson & Co. (WOOL) Pty. Ltd. v. Ludlow Jute Co., 569 F.2d 696, 698 (1st Cir.1978), indulging all inferences favorable to that party. Santoni v. Federal Deposit Insurance Corp., 677 F.2d 174, 177 (1st Cir.1982); O'Neill v. Dell Publishing Corp., 630 F.2d 685, 686 (1st Cir.1980). After a careful review of the record, the Court is persuaded that this is a case where the switch should be thrown and the summary judgment engine activated.
The plaintiff alleges that the defendant's utilization of the words "Railroad Salvage" infringes upon the service mark and trade name used by the plaintiff.9 A trade name describes the manufacturer or dealer, and applies not to vendible goods but to the business and its goodwill. New West Corp. v. NYM Co., 595 F.2d 1194, 1201 (9th Cir.1979); American Optical Corp. v. North American Optical Corp., 489 F.Supp. 443, 447 (N.D.N.Y.1979); Southwestern Bell Telephone Co. v. Nationwide Independent Directory Service, Inc., 371 F.Supp. 900, 907 (W.D.Ark.1974). Although trade names are not registrable under the Lanham Act, see note 9 supra, they are nonetheless...
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