Procter & Gamble Co. v. J.L. Prescott Co., 3 Cir., 102 F.2d 773. To permit another to build up his business reputation and thereafter, by asserting a right to the trade-mark, acquire the benefits of the reputation seems inequitable. Though I do not decide that such is the purpose of the plaintiff, it is apparent that an award of the relief asked would place it in a position to do so. At the same time, as it is in the exercise of discretionary jurisdiction that the doctrine of reasonable diligence is applied, and those who seek equity must do it, a court might hesitate as to the measure of relief, where the use, by others, for a long period, in face of the complainant's inaction, has largely enhanced the reputation of a particular brand.
The recent case in this District of Bisceglia Bros. Corporation v. Fruit Industries, 20 F.Supp. 564, 565, affirmed 3 Cir., 101 F.2d 752, affords support for these conclusions. There are definite factual differences between that case and this, but they are not so fundamental that the equitable concepts therein resorted to are beyond the scope of the present factual situation.
Since the plaintiff has made sales in states adjacent to Pennsylvania, it is contended that the defendant's very numerous sales in Pennsylvania have promoted confusion and deceived the public as to the identity of the brand concerned, insofar as they have "filtered" into the adjacent states. The case of Terminal Barber Shops v. Zoberg, 2 Cir., 28 F.2d 807, presents an example of the effect likely to result from the use by separate parties in adjacent markets of the same trade-mark or trade-name. The defendant in New Jersey adopted the trade-name which was used in New York City by the plaintiff. The defendant, by operating in areas contiguous to the location of the plaintiff's shops took advantage of and profited by the reputation of the plaintiff. The result to the plaintiff was a loss of customers who formerly had come from the area in which the defendant operated. The plaintiff was granted injunctive relief against the defendant. While this affords an analogy, it is not a perfect one.The parties in the instant case are selling merchandise of distinctly different qualities, and the separate state control renders the sales less likely to be intermixed. However, even assuming without admitting that some slight confusion may result, I am satisfied that, in view of all the facts of this case it is not inequitable to decree that the defendant shall hereafter have the right to use the trade-mark "Country Gentleman" within the Commonwealth of Pennsylvania, free from interference by the plaintiff, so long as the defendant restricts itself to that area.
Conclusions of Law.
1.The plaintiff obtained the right to use the trade-mark "Country Gentleman" as a business appurtenance in 1932.
2. This right was limited to the areas the plaintiff then occupied, was then entering, or would enter in the normal course of business expansion.
3. The markets created by the repeal of the Eighteenth Amendment, including that peculiar to Pennsylvania, were markets into which the plaintiff could enter in the normal course of business expansion.
4. The plaintiff has the right to use the trade-mark in those states in which it is appurtenant to his business or normally expanded business.
5. This right includes the right to protection by injunction restraining activities infringing on it or unfairly competing with its exercise.
6. The plaintiff's delay in prosecuting this right, while the defendant innocently built up a valuable business in Pennsylvania bars the plaintiff from an accounting and from the protection defined in paragraph five, insofar as concerns the defendant's sales in Pennsylvania.
7. The plaintiff is entitled to a decree enjoining the defendant from using the trade-mark "Country Gentleman" in those areas outside of Pennsylvania where the plaintiff is using the same or may do so in the course of normal sales expansion, and from otherwise unfairly competing with the plaintiff's use of the trade-mark "Country Gentleman" in those areas; this decree to be conditional upon a restriction, by the plaintiff, of its use of the trade-mark "Country Gentleman" to areas exclusive of Pennsylvania, and upon the plaintiff's restraint from unfair competition with the defendant in the latter's use of the trade-mark "Country Gentleman" in Pennsylvania.
8. The defendant is entitled to a decree enjoining the plaintiff from using the trade-mark "Country Gentleman" in Pennsylvania, and from otherwise unfairly competing with the defendant's use of the trade-mark "Country Gentleman" in that state; this decree to be conditional upon a restriction, by the defendant, of its use of the trade-mark "Country Gentleman" to Pennsylvania and areas not subject to occupation by the plaintiff in the normal course of expansion of the plaintiff's sales, and upon the defendant's restraint from unfair competition with the plaintiff in the latter's use of the trade-mark "Country Gentleman" in areas exclusive of Pennsylvania where the plaintiff is using the trade-mark or may do so in the normal expansion of its sales.
9. In light of the circumstances herein noted and others made apparent in the course of the trial, it is deemed proper that each party should bear its own costs.
10. A decree in accordance with the findings and conclusions herein may be submitted for entry as the order of this court.
The requests for findings of fact and conclusions of law are affirmed to the extent consistent herewith, and denied insofar as inconsistent herewith.
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