business. It has been said that "unless the borrower's use is so foreign to the owner's as to insure against any identification of the two, it is unlawful", Yale Electric Corporation v. Robertson, 2 Cir., 26 F.2d 972, 974. I cannot rely too much upon this statement, as it relates to tangible goods rather than restaurants or cafes, but it does persuade me that probability of identification is alone sufficient when actual identification would work to the plaintiff's ultimate disadvantage.
Upon reviewing the cases cited by the defendants, I conclude that they are inapplicable here due either to material factual divergence or noncontrolling legal bases.
Recurring now to the facts of the present case, it is objected that the plaintiff has not satisfactorily established its right to use the name "The Stork Club". Without considering the legal efficacy of the purchase or assignment, I am convinced there is no force to this objection. The prior user, the Stork Restaurant Corporation, went out of business. Since the name was its property only as an appurtenance to its business, dissolution of the business freed the name for appropriation by another business. Restatement of the Law of Torts, § 752. Furthermore, I am in sympathy with the thought that "It seems to violate common sense to hold that, because a plaintiff asserts a trade-mark title to which is not perfect, the court must stand by and allow the defendant to continue to deceive the public. It does not seem to accord with public policy for an equity court to permit deceit of the purchasing public, once the existence of such deceit or confusion is called formally to its attention, for any reason." Nims "Unfair Competition and Trade-marks", 1929, p. 975. The deceit in this instance is, of course, indirect if not trivial, because there is not yet evidenced any damaging confusion, but the principle is appropriate.
The defendants raise a correlative objection to the effect that the plaintiff cannot recover in a court of equity because it is doing business under a name other than its proper corporate name. It is claimed that such cannot be done in New York, and the cases of In re United States Mortgage Co., 83 Hun 572, 32 N.Y.S. 11, and Scarsdale Pub. Co.-The Colonial Press v. Carter, 63 Misc. 271, 116 N.Y.S. 731, are cited. These cases are concerned with circumstances not here pertinent. There is, for example, quite a difference between endeavoring to make binding contracts under a name other than the granted name and marketing goods or services under a "label" designed to facilitate and insure their identification. Therefore, I do not deem the cited dicta pertinent.
Manifestly the defendant is profiting, if to an indeterminate extent, from the reputation and significance which are adjuncts of the plaintiff's name "The Stork Club". As noted, however, this alone is not sufficient to establish the plaintiff's right to the relief sought. It must appear that the public is being deceived, in some manner likely to prove detrimental to the plaintiff -- not necessarily that the defendant is getting some business which would otherwise be going to the plaintiff, but that the defendant's use is deceiving the public to the plaintiff's probable ultimate injury.
Though there has been shown but slight confusion, it requires nothing but comparison of the names, insignia and fundamental character of business done to demonstrate that there is a likelihood of future confusion. Whether the defendant's business will continue to differ as it now does from that of the plaintiff can only be conjectured. Whether the now patent difference will effect a depreciation of the value of the plaintiff's name and insignia is even more conjectural. But, I am decided that there exists a threat, if not a promise, of growing confusion to the detriment of the plaintiff's reputation in an area from which its patrons are in part drawn.
This latter conclusion must, of course, be tempered by an admission that the foreseen confusion, if it occurs, will not damage the reputation "at large" of the plaintiff. That is, any injury done to the plaintiff's reputation will be confined to a geographically and numerically small proportion of the plaintiff's public.However, this admission does not constrain me to view the defendant's transgressions as within the rule of de minimis non curat lex. In fact, reflection clarifies the possible, perhaps probable effects of licensing such an usurpation of reputation as here confronts me. Upon the strength of a single, if sustained, precedent the plaintiff could be literally "hemmed in" by "Stork Clubs", until the public was so surfeited with the same that the mere mention of the name would provoke contrary reactions.
An unfair competitor may, under proper conditions, be held to an accounting for profits, Wolf Bros. & Co. v. Hamilton-Brown Shoe Co., 8 Cir., 206 F. 611, but I do not deem the instant circumstances sufficient to satisfy reasonable prerequisites to the same.
Conclusions of Law.
1. The Court has jurisdiction over the matter involved in this proceeding.
2. The plaintiff corporation is entitled to use the name "The Stork Club" and the insignia adopted relative thereto in its New York business.
3. The plaintiff is entitled to protection against trade practices which do or are likely to infringe unfairly upon the plaintiff's use of the name and insignia.
4. The defendant Marcus, in using the name "The Stork Club" and insignia similar to that adopted by the plaintiff, is guilty of an unfair trade practice.
5. The defendants Toll and Hahn are not parties to the practice.
6. The plaintiff is entitled to an injunction restraining the defendant Marcus from conducting his restaurant-cafe-night club under the name "The Stork Club" or any name similar thereto, and from using in conjunction therewith or independently any insignia similar to or suggestive of that of the plaintiff.
7. In light of the circumstances herein noted and others made apparent in the course of the trial, it is deemed proper that the defendants Toll and Hahn should be relieved of the payment of any costs and that the plaintiff and the defendant Marcus each should bear their own costs.
8. 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 in so far as inconsistent herewith.
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