Tetley, Inc. v. Topps Chewing Gum, Inc.
| Decision Date | 17 February 1983 |
| Docket Number | No. CV-82-3722.,CV-82-3722. |
| Citation | 556 F. Supp. 785 |
| Parties | TETLEY, INC., Plaintiff, v. TOPPS CHEWING GUM, INC., Defendant. |
| Court | U.S. District Court — Eastern District of New York |
Albert Robin, New York City, for plaintiff.
Colvin, Miskin, Basseches & Mandelbaum and Shea & Gould by Mark T. Basseches and Jeffrey H. Squire, New York City, for defendant.
Plaintiff, Tetley, Inc., commenced this action asserting federal and pendent state statutory and common law claims, alleging that it has been damaged by defendant's distribution and sale of gummed stickers, known as "Wacky Packages" or "Wacky Packs," which satirically depict the retail packages of various mass-marketed commercial products. Plaintiff is a seller of a variety of beverage products under the trademarks "Tetley" and "The Tiny Little Tea Leaf Tea," using designs and packaging said to bear a distinctive trade dress and also a licensor of its trademarks to others and a holder of related patents on its products. Plaintiff alleges that defendant offers for sale and sells in interstate commerce a Wacky Packs sticker displaying a simulation of plaintiff's trademarks, designs, and trade dress in the form, inter alia, of a label reading "Petley Flea Bags," which is likely to cause confusion in the marketplace. Plaintiff expresses concern that consumers will be given the mistaken impression that the offending stickers are made by or for, are endorsed or sponsored by, or are otherwise connected with Tetley. Plaintiff further alleges that defendant's use of Tetley's trademark properties is without license or permission.
Plaintiff has pleaded in its complaint six causes of action, including: (1) common law disparagement of plaintiff and its product, (2) common law misappropriation of the good will associated with plaintiff's trademarks and trade dress, (3) dilution of plaintiff's trademarks and trade dress, in violation of § 368-d of the New York General Business Law, (4) trademark infringement, in violation of 15 U.S.C. § 1114(1), (5) common law unfair competition, and (6) false designation of origin, description, and representation, in violation of 15 U.S.C. § 1125(a).
This matter is before the Court on plaintiff's application for a preliminary injunction pursuant to Rule 65 of the Federal Rules of Civil Procedure prohibiting defendant and anyone affiliated with it from manufacturing, advertising, offering for sale, selling, distributing or otherwise disposing of "Wacky Packs" stickers and related products bearing a simulation of plaintiff's trademarks, design, and trade dress. An evidentiary hearing on plaintiff's application was conducted on December 28, 1982. For the reasons stated below, the application for a preliminary injunction is denied. What follows sets forth this Court's findings of facts and conclusions of law as required by Rule 52(a) of the Federal Rules of Civil Procedure based on the evidence elicited at the hearing and the undisputed portions of the complaint and affidavits filed in connection with this motion.
It is undisputed that plaintiff has been and now is selling a variety of tea products under the registered trademarks "Tetley" and "Tetley Tea" displayed on a package design. In addition, over ten years ago, plaintiff adopted "The Tiny Little Tea Leaf Tea" slogan and design as a trademark for its product which it has used on its packaging. The slogan was registered in June 1982. Plaintiff has also used these marks and designs in television, radio, magazine, and newspaper advertising and has licensed these trademarks and designs on other products including towels, umbrellas, mugs, and coolers.
It is also undisputed that defendant, Topps Chewing Gum, Inc., is a manufacturer of bubble gum, sports trading cards and stickers, and other candy and novelty products primarily designed for children. Defendant has, from time to time since 1967, created and sold Wacky Packs which, in the current version, are sold at retail five to a pack, the packs being supplied to retail vendors in cartons of one hundred packs. The Wacky Packs stickers satirize the retail packages of some 120 mass-marketed commercial products by depicting replicas of the familiar packages and altering the true product names, logos, slogans or package designs by means of puns, caricatures, and the like. Thus, a can of Pepsi-Cola becomes "Pupsi-Cola: The Soft Dunk for Dogs," on a sticker depicting a replica of a soda can with the "Pepsi-Cola" logo and a sketch of a dog sipping cola through a straw. Head and Shoulders shampoo becomes "Head and Boulders Shampoo," labelled as being "for people with rocks in their heads" on a sticker depicting a replica of the familiar Head and Shoulders bottle with a caricatured face and a gravel-like substance emanating from the spout. The gummed stickers measure three inches by two inches and are sold backed with waxed paper depicting, inter alia, the "Wacky Packages" logo, the number of the sticker in the series of 120 stickers, and the message, "It's Topps for fun ... Collect the entire set of 120 stickers." The individual packs of five stickers are sealed so that there is no way of identifying from the exterior of the packet which five stickers out of the series of 120 are contained in the pack.
As may be gleaned from the above, Wacky Packs are directed at children ages 6 to 12 and are distributed at retail primarily through candy, tobacco, and convenience stores. A limited number of stickers are distributed by an agent of defendant to collectors in a manner that will be discussed more fully below.
The present dispute arises out of one of the current series of 120 Wacky Packs stickers that bears the name "Petley" on a picture of an orange and blue box, which both parties agree is designed and intended to be a replica of the box in which Tetley tea bags are commonly sold at the retail level. Shown on the box is a sitting dog depicted as furiously scratching fleas with one of his hind legs. The box pictured on the sticker has written on it, in lettering and coloring similar to that used on the Tetley tea bag box, "40 Flea Bags," "Orange Pekingese Fleas," and, around a silhouette of an insect, "Tiny Little Dog Fleas."
Defendant asserts, without contradiction, that the "Petley" sticker was first distributed by it in a slightly smaller version in a prior Wacky Packs series of 30 stickers that was released in 1975 and continued to be distributed through 1977, when the current series was launched. While plaintiff does not dispute that the sticker it now complains of has been in circulation some seven years, it denies that it had any knowledge of the sticker in question until October of this year. Defendant asserts, again without dispute from plaintiff, that at least 200,000 Petley stickers were included among the Wacky Packs stickers sold between 1975 and 1977 and that approximately 400,000 "Petley" stickers have been printed and in large part already distributed as part of the current series comprised of some 9,500,000 packs of stickers.
Plaintiff states that on October 7, 1982, after it first learned of defendant's sticker, plaintiff's vice president and general counsel sent a letter to defendant's president demanding immediate discontinuation of the "Petley" sticker. Defendant has taken the position in response to this demand that it will continue distribution of the "Petley" sticker until the current printing is exhausted in the spring of 1983, but that the "Petley" sticker will be removed from the Wacky Packs series thereafter.
Plaintiff now seeks to enjoin, pending the final disposition of this action, the distribution and sale of the "Petley" stickers remaining in defendant's inventory. That inventory consists of approximately ten million stickers of all varieties sealed in two million packs. Approximately 80,000 "Petley" stickers are to be found within the two million sealed packages. Eighty percent of the current Wacky Packs printing of 9.5 million packs of stickers has already been sold and shipped, and defendant's current inventory contains the final 20% of its total production. In addition, approximately 4,500 stickers are not in sealed packages but are sold by mail in groups of ten, so that children collecting Wacky Packs stickers in a pre-printed sticker album also sold by defendant can complete their collections without buying additional packs at retail. Defendant's current inventory of two million packs containing ten million stickers has a wholesale value of $300,000.
Plaintiff has advanced in support of its application for a preliminary injunction only its claims pursuant to the federal trademark laws and § 368-d of the New York General Business Law. Accordingly, the common law causes of actions pleaded in its complaint are not considered in connection with this application.
The standard in this Circuit for obtaining a preliminary injunction requires a showing of (1) irreparable harm and (b) either (1) a likelihood of success on the merits or (2) sufficiently serious questions going to the merits to make them a fair ground for litigation and a balance of hardships tipping decidedly toward the party requesting the preliminary relief. Sperry International Trade, Inc. v. Israel, 670 F.2d 8, 11 (2d Cir.1982), citing Jackson Dairy, Inc. v. H.P. Hood & Sons, Inc., 596 F.2d 70, 72 (2d Cir.1979) (per curiam).
Under the federal trademark laws, the issues of irreparable injury and a likelihood of success on the merits are intertwined.
"In the preliminary injunction context, a showing of likelihood of confusion as to the source or sponsorship establishes the requisite likelihood of success on the merits as well as risk of irreparable harm."
Standard & Poor's Corp., Inc. v. Commodity Exchange, Inc., 683 F.2d 704, 708 (2d Cir. 1982) (citations omitted).
As one court noted with respect to trademark claims in general:
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