Spangler Candy Co. v. Crystal Pure Candy Co.

• Decision Date: 09 October 1964
• Docket Number: No. 61 C 12.,61 C 12.
• Parties: SPANGLER CANDY COMPANY, an Ohio corporation, Plaintiff, v. CRYSTAL PURE CANDY COMPANY, a partnership, Defendant.
• Court: U.S. District Court — Northern District of Illinois

235 F. Supp. 18

SPANGLER CANDY COMPANY, an Ohio corporation, Plaintiff, v. CRYSTAL PURE CANDY COMPANY, a partnership, Defendant.

No. 61 C 12.

United States District Court N. D. Illinois, E. D.

October 9, 1964.

COPYRIGHT MATERIAL OMITTED

G. B. Christensen and Bruce L. Bower, Winston, Strawn, Smith & Patterson, Chicago, Ill., for plaintiff.

Dean A. Olds, Jerome Gilson and James B. Blanchard, Hume, Groen, Clement & Hume, Chicago, Ill., for defendant.

DECKER, District Judge.

This is a suit brought by Spangler Candy Company (Spangler), plaintiff, against Crystal Pure Candy Company (Crystal), defendant, for trademark infringement and unfair competition. The defendant has counterclaimed for damages resulting from alleged unfair competition on account of news stories caused to be published by the plaintiff in trade journals and statements to defendant's customers by plaintiff's representatives concerning the subject matter of the plaintiff's suit.

Spangler is an Ohio corporation with its principal place of business in Bryan, Ohio. Crystal is a partnership with partners residing in the states of Illinois and New York and having a principal place of business at Chicago, Illinois.

This Court finds that there is diversity of citizenship between the plaintiff and all of the partners of the defendant partnership and that the amount in controversy, exclusive of interest and costs, exceeds the sum of $10,000.

Plaintiff and defendant both assert claims arising under state unfair competition law and the trademark statute (15 U.S.C. §§ 1051-1127). This Court has jurisdiction under 15 U.S.C. § 1121 and 28 U.S.C. §§ 1331, 1332 and 1338.

Pursuant to Rule 21 of this Court, the issue of liability under the allegations contained in the complaint and counterclaim was separated from the issue of damages, and a separate trial was ordered upon the issue of liability under the allegations contained in the complaint and upon the issues raised by the counterclaim and the answer thereto.

Plaintiff's Complaint for Trademark Infringement and Unfair Competition

Both plaintiff and defendant manufacture lollipops.¹ The gist of Spangler's complaint is that it had been packaging small lollipops, individually wrapped in white wax paper, about 30 to the package, in a clear polyethylene bag with its trademark and certain other words printed in a certain pattern with certain colors; that they had been doing this since 1957; that this system of marketing was well established and well known to the trade by 1959; that in April, 1960, Crystal began packaging lollipops in a similar manner using the same colors and many of the same phrases on their bag. Spangler specifically contends that their registered trademark "Dum-Dums" (printed in the style described below) was infringed by Crystal's registered trademark "Pop-Pops." Spangler further contends that Crystal's use of a similar bag with similar colors and writings, either in conjunction with the defendant's trademark, or as an independent collocation, constitutes unfair competition.

Plaintiff alleges that defendant did this with the intent to infringe and with the intent to compete unfairly and with the intent to palm off defendant's product as plaintiff's.

Plaintiff requests injunctive relief, an accounting and damages.

In addition to the jurisdictional facts noted above, this Court makes the following Findings of Fact:

1. Plaintiff is engaged in the manufacture and sale of suckers in interstate commerce under the registered trademark "Dum-Dums."

2. Plaintiff acquired the "Dum-Dums" business and trademark from the Akron Candy Company in 1953.

3. Akron and its predecessors used the trademark in connection with the manufacture and sale of lollipops in interstate commerce continuously since its date of first use, February 1, 1924.

4. The trademark "Dum-Dums" is validly registered and all the necessary procedural steps for its transfer to Spangler have been followed.

5. Plaintiff's trademark "Dum-Dums" is printed with the word "Dum" on an upper line and with the letters in descending size followed by a cuneiform dash and a lower line consisting of the word "Dums" with the letters in ascending size.

6. Spangler has continuously engaged in the manufacture and sale of lollipops under the trademark of "Dum-Dums" in interstate commerce since the transfer in 1953.

7. Plaintiff markets its "Dum-Dums" suckers in a variety of packages, including clear polyethylene or plastic bags, cardboard cartons, and bulk containers.

8. The 29¢ polyethylene bags are sold to supermarkets and comprise 50% of the "Dum-Dums" business.

9. Since 1954 plaintiff has used a clear polyethylene bag containing 29 or 30 individually wrapped suckers, weighing about ten ounces.

10. Imprinted on the polyethylene bag were the trademark "Dum-Dums" and the plaintiff's trade name Spangler Candy Company with the address Bryan, Ohio.

11. Also imprinted on the plaintiff's polyethylene bag were designs of red and blue balloons and a yellow flag or pennant upon which was printed the plaintiff's trademark; in association with these designs were illustrations of a cowboy and of a small girl pulling the balloons.

12. On the plaintiff's bags are also printed "Save Dum-Dums Wrappers," and "The World's Best Pop."

13. The suckers in plaintiff's bag are ball shaped with a band running around the mid-portion of the sucker and with one side of the sucker round and the other slightly flattened.

14. Plaintiff's suckers are wrapped individually in whitish wax paper; the wax wrappers have had various different styles of bands of color applied to them in which the color and a picture of the fruit indicated the flavor of the sucker, such as red with a picture of a cherry for cherry flavor.

15. Plaintiff's bag is sold at retail for 29¢.

16. Plaintiff has used the same 29¢ supermarket bag continuously since 1956 with the exception of certain minor variations resulting from printing errors or changes in weight; at Halloween time removable seasonable streamers were attached.

17. Plaintiff has spent less than $1,000. advertising its product to the public.

18. Defendant has marketed candy in the United States for many years, and, since 1947, has specialized entirely in the sale of suckers through grocery stores, drug stores and supermarket chains.

19. Defendant registered its trade name "Pop-Pops" in the United States Patent Office on October 2, 1962.

20. Initially the "Pop-Pops" trademark on the wax wrapper was printed with the word "Pop" on an upper line and with the letters in descending size, followed by a cuneiform dash and a lower line consisting of the word "Pops" in ascending size.

21. Shortly after the suit was started, Crystal began printing its trademark on the wax wrappers horizontally.

22. In 1959 defendant's managing partner, Arthur Abbey, designed a new package format for suckers which were to be sold under the trademark "Pop-Pops;" at the time that Abbey designed the defendant's package and sucker wrapper, he had before him a variety of competitors' packages, including one of the plaintiff's "Dum-Dums" packages.

23. Abbey designed a package to approximate the format of Spangler's package; he admitted he attempted to get "as close to it without copying it" as he could (Record p. 713).

24. Defendant's lollipop is the same shape as plaintiff's lollipop.

25. Defendant's bag consisted of clear polyethylene with "Pop-Pops" printed on it as well as the defendant's trade name, Crystal Pure Candy Company, Chicago, Illinois.

26. The design elements on defendant's package consist of triangles in the colors of red, yellow and blue.

27. The "Pop-Pops" trademark was printed with letters of equal size.

28. The defendant's bag also has the words "Save Wraps for Prizes," "with paper safety sticks," and "America's best pop!" printed on it.

29. Defendant has been using the same package, with the exception of the above-mentioned change in the wax wrappers, since April, 1960.

30. Evidence shows that other candy manufacturers have used polyethylene bags and other candy manufacturers have used wax wrappers for lollipops.

31. Evidence shows that this product is bought primarily on the basis of cost to the merchant, not on the basis of a demand for "Dum-Dums" or "Pop-Pops." They are considered to be "substitutes."

32. Plaintiff and defendant utilized the same premium house in Chicago for almost one year; upon the plaintiff's inquiry, the premium house stated that "Pop-Pops wrappers were never sent in for Dum-Dum premiums or vice versa."

Trademark Infringement

Plaintiff complains that the defendant has violated the Lanham Act, 15 U.S.C. § 1114, by its adoption of the name in issue. The statute provides, in part:

"Any person who shall, without the consent of the registrant —

"(a) use in commerce any * * * copy or colorable imitation of a registered mark in connection with the sale * * * of any goods * * * on or in connection with which such use is likely to cause confusion, or to cause mistake, or to deceive; * * *

* * * * *

shall be liable * * *."

The phrase "colorable imitation" is defined as follows by 15 U.S.C. § 1127:

"The term `colorable imitation' includes any mark which so resembles a registered mark as to be likely to cause confusion or mistake or to deceive."

A registered trademark is to be protected if another uses the same form, spelling or sound in such a way that confusion is likely to result in the minds of the ordinary consumer. As the Court said in Independent Nail & Packing Co. v. Stronghold Screw Products, Inc., 205 F.2d 921 (7th Cir. 1953):

"`It is sufficient if one adopts a trade-name or a trade-mark so like another in form, spelling, or sound that one, with a not very definite or clear recollection as to the real trade-mark, is likely to become confused or misled.' Northam-Warren Corp. v. Universal Cosmetic Co., 7 Cir., 18 F.2d 774, 775." (Ibid. at p. 924)

The proper comparison must be made under the conditions...