Societe Comptoir De L'Indus. v. Alexander's Dept. Stores, Inc.

• Decision Date: 20 January 1961
• Parties: SOCIETE COMPTOIR DE L'INDUSTRIE COTONNIERE, ETABLISSEMENTS BOUSSAC, Christian Dior, Societe a Responsabilite Limitee, Paris, and Christian Dior New York, Incorporated, Plaintiffs, v. ALEXANDER'S DEPARTMENT STORES, INC., Defendant.
• Court: U.S. District Court — Southern District of New York

190 F. Supp. 594

SOCIETE COMPTOIR DE L'INDUSTRIE COTONNIERE, ETABLISSEMENTS BOUSSAC, Christian Dior, Societe a Responsabilite Limitee, Paris, and Christian Dior New York, Incorporated, Plaintiffs, v. ALEXANDER'S DEPARTMENT STORES, INC., Defendant.

United States District Court S. D. New York.

January 20, 1961.

David Rayvid, New York City, for plaintiffs, Morton Amster, Amster & Levy, New York City, of counsel.

Lewis, Durante & Bartel, New York City, for defendant, J. Norman Lewis, James P. Durante, Frederick E. Smithline, New York City, of counsel.

Weil, Gotshal & Manges, New York City, for The Chambre Syndicale de la Couture Parisienne, amicus curiae, Sylvan Gotshal, Ira M. Millstein, Marshall C. Berger, New York City, of counsel.

DIMOCK, District Judge.

Before me are a motion by plaintiffs above named, who will be referred to collectively for convenience as "Dior", for a preliminary injunction, and a motion by defendant Alexander's Department Stores, Inc., which will be referred to for convenience as Alexander's, for an order under Rule 12(b) (6) F.R.Civ.P., dismissing the complaint on the ground that it fails to state a claim on which relief can be granted. Affidavits in support of the motion to dismiss and in opposition to it have been submitted so that, pursuant to Rule 12(b), I shall treat the motion as one for summary judgment and dispose of it as provided in Rule 56.

The action is one brought by a group of corporations who do business under the name "Dior" or "Christian Dior" and who have registered those names as trade-marks. It is based upon the use of the name Dior by defendant in connection with the sale of women's dresses. No answer has as yet been interposed. Defendant's affidavits in support of the motion for summary judgment raise, however, several affirmative defenses.

Plaintiff can support its position in opposition to the motion for summary judgment by relying upon charges in the complaint which are here undenied by affidavit or as to which there is an issue of fact presented by the affidavits. On the other hand, nothing can be considered in support of plaintiff's motion for a preliminary injunction except facts supported by affidavit. I shall first state the facts alleged in the affidavits and then, as part of my consideration of the merits of the motion for summary judgment, state the allegations of the complaint.

Allegations in Plaintiff's Affidavits.

Christian Dior, Paris, a French corporation, one of the group collectively referred to as plaintiff, was established in 1947 and since that time has achieved world-wide fame as a leading couturier. The fashions which Christian Dior, Paris, designs, manufactures and sells are of the highest quality available from any fashion house in the world with regard to original design, quality, styling, details of manufacture, fit and general superiority in all aspects of ladies' clothing. The name Dior has achieved world-wide fame in the fashion field as the result of the activities of Christian Dior, Paris, and Christian Dior, New York, Incorporated, another of the corporations referred to collectively as plaintiff. Societe Comptoir de l'Industrie Cotonniere, Etablissements Boussac, a French corporation, is the third corporation of the group of three collectively referred to as plaintiff. It owns and controls both Christian Dior, Paris, and Christian Dior, New York, Incorporated, and is the owner of the trade-mark registrations. The French subsidiary is authorized to utilize these trade-marks on ladies' fashions within the Republic of France and throughout the world. The New York corporation is similarly licensed to utilize the trademarks within the United States.

An item on the fashion page of the New York Times for March 7, 1960 resulted from a news release sent out by defendant. It consisted of a picture of a dress with a description and the legend "By Dior $35. All copies, second floor, Alexander's."

On September 11, 18 and 25, 1960, defendant Alexander's, which operates a group of department stores in the New York area, placed advertisements in a number of New York newspapers containing statements to the general effect that Alexander's had brought back from the continent one of the nation's largest collections of couturier originals, that Alexander's panel of experts had had them reproduced by America's leading manufacturers and that it was almost impossible to tell the copies from the originals. These advertisements listed the names of eighteen European couturiers, including Dior.

On September 13, 1960, defendant Alexander's sponsored and produced a television fashion show during the course of which an original Dior garment was exhibited to the television public and reference was made to the name Dior.

These uses of the name Dior were without authorization by plaintiff.

It is alleged that similar conduct of defendant has continued and still continues.

Plaintiff's affidavit concedes that original designs by Christian Dior, Paris, are not subject to protection in the United States. The affidavit states, however, that plaintiff protects its valuable trademark and reputation by allowing its customers to reproduce the designs of purchased garments but reserving the use of the name Dior to retail stores of the highest quality, association with which will not have a deleterious effect on the value of the trade-mark. In accordance with this general rule there are three situations which are encountered with respect to United States retailers.

First, Dior sells ladies' wearing apparel to a selected group of retail establishments in the United States for purposes of relatively high-priced reproduction by such retail establishments. These purchasers are given permission to utilize the name Dior in advertising the authorized reproductions. The name, however, is never allowed to be used on the reproductions themselves. Extreme care is exercised to insure that each of such retail establishments is of the highest reputation so that plaintiff is assured that the name Dior will be used only in connection with garments of the highest quality and only in stores where customer service is excellent and customer satisfaction is rigidly protected.

Second, a few stores are permitted to purchase Dior dresses with the understanding that they will be used as models for popular priced reproductions but that the name Dior will never be used in connection with the sale of such reproductions.

Third, there is a group of retail establishments in the United States which plaintiff has traditionally refused to authorize to copy Dior designs.

In addition to its sales to retailers in the United States, Dior also sells to United States manufacturers who desire to reproduce Dior designs independently. The contract of sale in such cases provides that, unless the manufacturer has received a specific written authorization, the use of the name Dior in whole or in part in advertising, labels or elsewhere, is prohibited.

Defendant Alexander's has several times been refused the right to purchase and reproduce Dior garments. These refusals were based upon plaintiff's investigation of the merchandising techniques employed by defendant. This decision was largely based upon a report of an investigator a copy of which is submitted with the affidavits of plaintiff but without the oath of the investigator.

During the winter of 1959-1960 a large cosmetic firm sponsored and produced a television "spectacular" on which were displayed the latest designs of several world famous couturiers including those of Dior. The group received in payment from the sponsor a substantial sum of money for the right to exploit the trademarks, trade names, good will and reputation of the couturiers.

Plaintiff has at the present time granted an option to a television production company for the use of the name Christian Dior and Dior and for the display of Christian Dior designs on television.

A shopper employed by plaintiff called at defendant's Bronx store on November 1, 1960 and asked to see dresses in a price range of not more than $50 nor less than $30 and asked whether defendant had any dresses by famous European designers, specifically referring to Dior. The saleswoman took three dresses off racks labeled "Manufacturers Closeout". The shopper took one in her hand and asked "Who is the designer of this?" The saleswoman replied, "This is the House of Dior" and stated that all three had appeared on their September television show and in subsequent newspaper advertisements. She said that one was a copy of a Dior dress which defendant sold for $95 following the fashion show in September. The shopper purchased one of the dresses and, saying that it would need alteration, asked that the saleswoman call a seamstress. She was told that defendant did not have a seamstress. The shopper pointed to a soiled spot on the skirt and a pulled thread. The saleswoman said "Oh, well, you can always have it cleaned and pressed" and further remarked that the flaw in the skirt would "press right out". The saleswoman said that the television show had been televised directly from the airport where a number of dresses sold by defendant were modeled, including the Dior dress which the shopper had just purchased and which defendant sold for $95 following the fashion show. Plaintiff in its affidavits characterized this dress as a cheap imitation of a Dior model.

Another shopper employed by plaintiff went to defendant's Bronx store on September 26, 1960. She followed a sign directing towards "French and Italian fashions" and entered a merchandise area entitled "La Boutique" where there were a number of individual racks on which clothing was hung. The individual racks were labeled "Adaptation of * * *" followed by the name of the particular French or Italian couturier. Along one wall in this room there were a large number of dresses hung on a single rack which were individually labeled "Originals by * * * (followed by...