Le Sportsac, Inc. v. Dockside Research, Inc.

• Decision Date: 07 August 1979
• Docket Number: No. 79 Civ. 2965 (KTD).,79 Civ. 2965 (KTD).
• Parties: LE SPORTSAC, INC., Plaintiff, v. DOCKSIDE RESEARCH, INC., Executive Travelware, and Dockside Research, Inc. d/b/a PAX, Defendants, v. Melvin SCHIFTER, Additional Defendant Named on the Counterclaim.
• Court: U.S. District Court — Southern District of New York

478 F. Supp. 602

LE SPORTSAC, INC., Plaintiff, v. DOCKSIDE RESEARCH, INC., Executive Travelware, and Dockside Research, Inc. d/b/a PAX, Defendants, v. Melvin SCHIFTER, Additional Defendant Named on the Counterclaim.

No. 79 Civ. 2965 (KTD).

United States District Court, S. D. New York.

August 7, 1979.

Greenbaum, Wolff & Ernst, New York City, for plaintiffs; Roger Bryant Hunting, James L. Adler, Jr., Marcia B. Paul, James H. Stark, New York City, of counsel.

Kirschstein, Kirschstein, Ottinger & Cobrin, P. C., New York City, for defendants; Alan Israel, New York City, of counsel.

OPINION & ORDER

KEVIN THOMAS DUFFY, District Judge:

Plaintiff, Le Sportsac, Inc., has brought this action charging that defendants Dockside Research, Inc., Executive Travelware, and Dockside Research, Inc., d/b/a Pax hereinafter sometimes collectively referred to as "Pax" are guilty of common law trademark infringement, unfair competition, both statutory and common law, and violations of the New York's antidilution statute, § 368-d N.Y.G.B. Law. Plaintiff is the manufacturer of high fashion bags and other items made of color-coated ripstop nylon, trimmed with cotton carpet tape and carried by means of web straps. Defendants have been marketing a line of products identical to that manufactured by plaintiff save for the omission of the Le Sportsac logo which is repetitively printed on the carpet tape trimming that which adorns plaintiff's products and the addition of a label bearing defendants' trademark.

Plaintiff has now moved for a preliminary injunction enjoining defendant from (a) manufacturing, selling, distributing, or otherwise fabricating a line of goods that would infringe upon or trade upon the Le Sportsac name, mark or line of goods; (b) from using the mark or logo of Le Sportsac or any colorable imitation thereof on any line of goods; and (c) from using the Le Sportsac name or logo or any colorable imitation thereof on any tags, wrappings, advertising material, publicity or promotional material, or in any manner whatsoever in connection with any line of goods. Prior to the hearing on the application for relief pendente lite, depositions of both parties were taken with officers of each testifying. These depositions, together with various affidavits and exhibits are presently before me. The parties have stipulated that an evidentiary hearing is unnecessary and ask that I render my decision based upon the documentary evidence heretofore submitted. The following shall constitute my findings of fact and conclusions of law.

FACTS

The Le Sportsac line of goods consists of bags used for travel as well as accessories made of a color-coated ripstop nylon which plaintiff contends was especially developed for it. The products are available in a wide variety of colors and are trimmed with 100 percent cotton carpet tape in black or tan. The bags are carried by means of 1½ inch straps made of herringbone weave cotton webbing of the same color as the carpet tape trim. On many products the cotton trim is fastened by means of brass plated rivets. The larger bags may be locked by means of a brass lock and key.

Most of the Le Sportsac bags are opened and closed by means of a double ended zipper which goes almost all around the bag. The color of the zipper is coordinated with that of the carpet tape. The zippers are pulled by means of hollow metal sliders in a rectangular shape. Many of the Le Sportsac bags also have zippered compartments that employ the same hollow metal sliders.

Le Sportsac products are sold to the public together with a zippered pouch into which the Le Sportsac products may be folded and stored. Plaintiff calls this pouch the "tuckabagaway pouch" and contends that it originated and developed the storage pouch concept on bags of ripstop nylon.

Another feature of the Le Sportsac line is the logo of Le Sportsac which is repetitively printed on the cotton trim of each of the products. The logo consists of a bright green circle followed by white stylized letters spelling the name Le Sportsac and enclosed by a light colored elongated ellipse. The circle, lettering and ellipse all appear against a dark elliptical background.

The Pax line of products, which first appeared in September, 1978, is remarkably similar, if not identical to that manufactured by plaintiff. Indeed, Arthur Freedman, the president of defendant Dockside, has admitted that he copied certain Le Sportsac products and that there are no differences between those copied products and Pax's line except for the absence of the Le Sportsac logo. Mr. Freedman testified that twenty-one of the twenty-three items in defendants' line are copied from the Le Sportsac line. Deposition of Arthur Freedman at 13. He further testified that defendants have advertised, promoted and sold Pax products by means of a catalogue that contained photocopies of plaintiff's products although they no longer do so. It also appears that in 1978 Pax's products were marketed with a hangtag that featured a bright blue circle followed by white stylized letters spelling the name Pax, together with text, enclosed in an elongated blue ellipse on a black background. Freedman testified that it is defendants' practice to "market what the market wants . . if buyers come to you and suggest this is hot, that is hot, do it; you do it." Id. at 25.

Although aware of the Pax line since August, 1978, plaintiff did not commence the instant action until June, 1979, some ten months later. Plaintiff asserts that the continued marketing of the Pax line will cause it irreparable injury and that defendants' actions constitute violations of its rights under the trademark laws.

DISCUSSION

The standards for granting a preliminary injunction are well settled. The party seeking such relief must establish both possible irreparable injury and either (i) a likelihood of success on the merits or (ii) sufficiently serious questions going to the merits to make them a fair ground for litigation and a balance of hardships tipping decidedly in the movant's favor. Selchow & Righter Co. v. McGraw-Hill Book Company, 580 F.2d 25, 27 (2d Cir. 1978).

Plaintiff asserts that it has shown a likelihood of success on the merits or, at the least, substantial questions going to the merits and a balance of hardships in its favor. It contends that it has a common law trademark in the Le Sportsac name and logo, as well as in the nonfunctional design aspects of its product. On this motion, only the latter assertion need be considered since defendants have altered their hangtag so as to eliminate confusion with the Le Sportsac logo.¹

Plaintiff contends that the unique combination of design features of its bags serves to identify these products as its own and vouches for their quality. It argues that by virtue of these features, its products have achieved trademark status and may not be copied with impunity.

Defendants on the other hand, urge that no such status has been achieved and that based upon Sears, Roebuck & Co. v. Stiffel Lamp Co., 376 U.S. 225, 84 S.Ct. 784, 11 L.Ed.2d 661 (1964) and Compco Corp. v. Day-Brite Lighting, Inc., 376 U.S. 234, 84 S.Ct. 779, 11 L.Ed.2d 669 (1964) they are free to copy every detail of plaintiff's product as they wish. In Sears and in Compco the United States Supreme Court held that a state's unfair competition law may not, consistently with federal patent laws, impose liability or prohibit the copying of an article that is not protected either by a federal patent or a copyright. In both cases the Court was faced on the one hand with unpatented and unpatentable products (a pole lamp in Sears, a fluorescent light fixture in Compco) and at the same time with lower Court rulings that the state law of unfair competition had been violated. The Court would not permit this conflict between the state and federal laws, for to forbid copying would interfere with the federal policy "of allowing free access to copy whatever the federal patent and copyright laws leave in the public domain." Compco, supra, at 237, 84 S.Ct. at 782. In broad language which has generated a great deal of controversy, see generally Dannay, The Sears-Compco Doctrine Today; Trademarks and Unfair Competition, 67 Trademark Reporter 132 (1977), the Court seemingly dealt the death blow to state claims based on copying or misappropriation:

As we have said in Sears, while the federal patent laws prevent a State from prohibiting the copying and selling of unpatented articles, they do not stand in the way of state law, statutory or decisional, which requires those who make and sell copies to take precautions to identify their products as their own. A State of course has power to impose liability upon those who, knowing that the public is relying upon an original manufacturer's reputation for quality and integrity, deceive the public by palming off their copies as the original. That an article copied from an unpatented article could be made in some other way, that the design is "nonfunctional" and not essential to the use of either article, that the configuration of the article copied may have a "secondary meaning" which identifies the maker to the trade, or that there may be "confusion" among purchasers as to which article is which or as to who is the maker, may be relevant evidence in applying a State's law requiring such precautions as labeling; however, and regardless of the copier's motives, neither these facts nor any others can furnish a basis for imposing liability for or prohibiting the actual acts of copying and selling.

Compco, supra, at 238, 84 S.Ct. at 782. Despite this broad language which has been characterized by one Court as dictum, Truck Equipment Service Co. v. Fruehauf, 536 F.2d 1210, 1214 (8th Cir. 1976), many courts have viewed the actual holdings of the cases narrowly. For example, the facts of both Sears and Compco involved the copying of product shapes and not their packaging, also known as trade dress. Thus, it has

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