Sylvania Electric Products v. Dura Electric Lamp Co.

• Decision Date: 29 August 1956
• Docket Number: Civ. A. No. 385-54.
• Court: U.S. District Court — District of New Jersey
• Parties: SYLVANIA ELECTRIC PRODUCTS, Inc., Plaintiff, v. DURA ELECTRIC LAMP COMPANY, Inc., and Michael Portnow, Defendants.

144 F. Supp. 112

SYLVANIA ELECTRIC PRODUCTS, Inc., Plaintiff, v. DURA ELECTRIC LAMP COMPANY, Inc., and Michael Portnow, Defendants.

Civ. A. No. 385-54.

United States District Court D. New Jersey.

August 29, 1956.

Pitney, Hardin & Ward, Newark, N. J., for plaintiff, by Arthur J. Martin, Jr., Newark, N. J., Watson, Leavenworth, Kelton & Taggart, New York City, of counsel for plaintiff, by Leslie D. Taggart, Robert C. Nicander, Nicholas John Stathis, Howard M. Cohen, New York City.

Harry B. Rook, Newark, N. J., for defendants, Mock & Blum, New York City, co-counsel for defendants, by Alexander Friedman, Edward F. Levy, New York City.

WORTENDYKE, District Judge.

This action is brought under the Lanham Act, 15 U.S.C.A. § 1051 et seq., for alleged infringement of a claimed trade-mark, admittedly registered in the United States Patent Office on October 30, 1951 with number 550,211, which presently remains uncancelled, and is owned by plaintiff, and for injunctive relief against alleged unfair competition. This Court has jurisdiction under § 1114 of the Act, 15 U.S.C.A. § 1114, also by 28 U.S.C.A. § 1338, and also because there is diversity of citizenship between plaintiff and the defendants, and the complaint alleges involvement of more than the minimum jurisdictional amount, 28 U.S.C.A. § 1332(a) (1). Cf. Standard Brands Inc., v. Smidler, 2 Cir., 1945, 151 F.2d 34, 36. The individual defendant, Portnow, admittedly president and managing officer and owner of fifty per cent of the stock of the corporate defendant, Dura Electric Lamp Company, Inc. (hereinafter called Dura) is charged by plaintiff with bringing about and continuing the alleged infringement and unfair competition by Dura through his control of that corporation. Plaintiff prays relief in the form of injunction, accounting, treble damages, delivery up for destruction of the allegedly offending products, and costs. The Court has jurisdiction of the parties.

Both plaintiff, Sylvania Electric Products, Inc. (hereinafter called Sylvania) and defendant, Dura, manufacture and sell, in interstate commerce, electric flash-bulbs used in flash-light photography. While generally sold in paper cartons and sleeves upon which the name and admitted trade-mark of the manufacturer appears, these bulbs are also sold in substantial quantities unpackaged and in bulk. No name of the manufacturer appears upon any individual bulb produced by either of the corporate parties; but there is placed during the course of manufacture at the top of the inside of the glass globe, opposite the base of every bulb produced by each of said parties, a dot or spot, generally circular in form, about one-eighth inch in diameter composed of cobalto-cobalti cyanide salt. During application, this salt is pink in color and is in suspension in a suitable liquid vehicle which is evaporated when the interior of the bulb is exhausted of atmospheric air upon the final sealing of the globe to the stem of the lamp. If the exhaustion of the moisture-bearing atmosphere from the globe has been adequate, the color of the spot or dot changes to blue. If, however, the color does not so change, but remains or returns to pink, insufficient exhaustion from or subsequent intrusion, through leakage, of atmosphere into the bulb is thereby indicated. The presence of this complex chemical within the globe of the bulb serves as a means of indicating to the manufacturer as well as to the distributor and ultimate user whether or not the bulb is defective. Both Sylvania and Dura recognize this utilitarian function of the dot or spot in their advertising and sales promotion; but Sylvania asserts that through the long and uninterrupted use by it and its predecessors of this spot or dot, with the color, of the composition, in the form and at the location in the bulb above described, commencing long anterior to the beginning of its use by Dura, the spot or dot had acquired a secondary meaning as a mark of identification of the bulb in which it appeared as the product of Sylvania or of one of its said predecessors. Sylvania charges, therefore, that defendants' use of a spot or dot, similar in shape, position, location and color, upon the bulbs which Dura manufactures, without an indication on the bulbs themselves that they are not products of Sylvania, is likely to enable Dura to "palm off" its products upon consumers by misleading the latter into the belief that bulbs manufactured by Dura were actually the products of Sylvania.

Defendants, while admitting that Dura uses a blue dot of cobalto-cobalti cyanide in each of the bulbs which it manufactures of a size and shape and at a position similar to that occupied by the blue dot in Sylvania's bulbs, assert that the dot serves the purely utilitarian function hereinabove described.¹ Defendants also charge that the use of the blue dot was covered by claim number 12 of United States Patent number 1,989,572, issued January 29, 1935, which has expired, and that such use of a spot of cobalt salt in a photoflash bulb is therefore in the public domain, available to all. Defendants therefore deny that the blue dot is a trade-mark and charge that plaintiff was not entitled to have it registered as such. Indeed, on July 11, 1952 Dura filed a petition in the United States Patent Office, pursuant to 15 U.S.C.A. § 1064, for the cancellation of plaintiff's registration, claiming invalidity thereof. These cancellation proceedings were suspended upon Sylvania's motion therein, pending final adjudication of the issues in the instant suit. Defendants deny that the blue dot serves to identify and distinguish plaintiff's flash-bulbs, and they also deny that the use of the blue dot by Dura constitutes unfair competition.

Insofar as it relates to the history of the use of the so-called blue dot or safety spot in photoflash bulbs, the evidence in this case discloses as follows: In or prior to the year 1931, N. V. Philips Gloeilampenfabrieken, a Dutch corporation (hereinafter referred to as Philips), in Eindhoven, Netherlands, developed an electrically ignitable photoflash bulb, using hydronalium wire instead of foil as the flashing agent. In the course of this development, Philips originated the use within the globe of the bulb and at its top end, opposite the base, of a dot or spot composed of cobalt salt as a means of detection in the course of manufacture of "leakage", through cracks or flaws in the globe or base of external atmosphere into the gas-charged interior of the bulb. For this invention British patent number 436,047 (Exhibit D-134) was issued to Philips following acceptance of its specifications on October 3, 1935. When such atmospheric intrusion occurred in one of these bulbs, the color of the cobalt spot (which had been pink when applied in suspension in liquid, but would become blue when dehydrated by evacuation of air and dried by heat) would turn back to pink; thus indicating the presence of moisture-laden gas within the bulb resulting from defective manufacture or subsequent damage. Salts of cobalt had been well known, long prior to Philips' use of the substance as a leakage indicator, to have the characteristic of exhibiting a pink color when diluted and a blue color when dried or in concentrated solution. See 2 Thorpe's Dictionary of Applied Chemistry (Rev. ed. 1921) page 299. The British Patent covered the bulb which it had developed, and included in the specifications thereof was the use of cobalto-cobalti cyanide as an indicating material. A United States Patent No. 1,989,572, Exhibit D-135, was issued to Philips (as assignee of Van Liempt, et al.) on January 29, 1935. This patent was also referred to in the testimony as the "Van Liempt" patent. This Court concludes that it covered the use of the "blue spot" composed of the materials and located at the position employed in the Sylvania and in the Dura bulbs, but expiration of the patent on January 29, 1952 threw the right to use such "spot" into the public domain.

By the terms of a written agreement (Exhibit P-87) Philips granted to Wabash, a New York corporation with place of business in Brooklyn, New York, an exclusive license (subject to a non-exclusive license retained by the licensor for itself or for an affiliated company) to manufacture, use and sell, throughout the United States "photoflash lamps of the type in which the material which emits actinic light when it is chemically reacting, is provided in the form of a thin wire." The agreement also provided that its scope comprised all United States patents and patent applications listed in an attached exhibit "insofar as the same may be used for or be applicable to the devices" (the photoflash lamps of the type above described) "falling under this agreement, and includes the technical information and manufacturing experience for the manufacture of these devices." The licensee (Wabash) agreed to pay to the licensor royalties on all devices sold by licensee under the agreement at the rate therein prescribed. The list of patents and applications attached to the foregoing agreement (Exhibit A therein referred to) is as follows:

U. S. A. Patent No. 2,037,101 of April 14, 1936

U. S. A. Patent Application Ser. No. 723,010, filed April 28, 1934

U. S. A. Patent Application Ser. No. 18,457, filed April 26, 1935

U. S. A. Patent No. 1,989,572 of January 29, 1935.

The production of photoflash bulbs by Wabash under this agreement met with favorable consumer response and the demand for its product ultimately threatened to outrun its ability to produce.

As early as October 1, 1940, Wabash issued to its dealers for distribution to consumers with its lamps an exposure data card (Exhibit P-90) containing "Flash and Flood Exposure Tables," a price list of its different sized bulbs, and a picture of one of its bulbs prominently displaying the spot on the end of the globe opposite the base and a legend, pointed to the spot, which read:

"This Wabash Safety Spot means 3 important

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