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GOEBEL BREWING COMPANY v. ESSLINGERS (03/23/53)

March 23, 1953

GOEBEL BREWING COMPANY, APPELLANT
v.
ESSLINGERS, INC.



Appeal, No. 86, Jan. T., 1953, from decree of Court of Common Pleas No. 4 of Philadelphia County, Sept. T., 1951, in Equity, No. 1546, in case of Goebel Brewing Co. v. Esslingers, Inc. Decree reversed.

COUNSEL

C. Russell Phillips, with him Harry E. Allen and Montgomery, McCracken, Walker & Rhoads, for appellant.

Lemuel B. Schofield, with him W. Bradley Ward, for appellee.

Before Stern, C.j., Jones, Bell, Chidsey and Arnold, JJ.

Author: Jones

[ 373 Pa. Page 337]

OPINION BY MR. JUSTICE JONES

The plaintiff sued to enjoin the defendant from "imitating or using the trademark, trade name, advertisements, bottle style or dress of the Plaintiff or any near similarity thereto, upon or in connection with beer or with the manufacture or sale thereof" in Pennsylvania or elsewhere within the plaintiff's sales area and, more specifically, to enjoin the defendant from "using the name 'Goblet' upon or in connection with the sale of beer within the area aforesaid." The bill also prayed for an accounting for profits to the defendant and damages to the plaintiff flowing from the defendant's allegedly unfair competition. The defendant answered to the merits. After a hearing, the learned chancellor dismissed the bill of complaint at the plaintiff's costs on the basis of an adjudication and decree nisi to which the plaintiff filed exceptions. The court en banc dismissed the exceptions and entered the decree nisi as the final decree. This appeal by the plaintiff followed. The material facts are not in dispute. The differences lie in the inferences to be drawn from them.

[ 373 Pa. Page 338]

The plaintiff, Goebel Brewing Company, is a Michigan corporation engaged in the manufacture and sale of beer and having its place of business and principal plants in that State. It began selling its product in Philadelphia in 1934. By 1939, its sales of beer were nation-wide. At that time, it commenced selling its beer in small "steinie" type bottles of seven-ounce capacity in Philadelphia and elsewhere. For the twelve-year period preceding the institution of the suit, the plaintiff's sales of its seven-ounce bottles of beer in Pennsylvania aggregated, in round figures, about 6,000,000 cases of twenty-four bottles each, of which sales ninety-five per cent were in Philadelphia. Throughout the years, Goebel Company has changed its labels, but it has always used the name "Goebel" thereon no matter what the form of the label happened to be.

The defendant, Esslinger, Inc., is a Pennsylvania corporation having its place of business and plant in Philadelphia. It, too, is engaged in the manufacture and sale of beer which it has brewed and sold since 1868. In 1939, Esslinger, Inc., also began selling beer in seven-ounce bottles in Philadelphia and vicinity. It sold beer so bottled under its trade name "Esslinger" as the rest of its beer was, and had been, sold in Philadelphia regardless of packaging. The Esslinger seven-ounce bottles were not "steinies"; they were merely a smaller type of the conventionally shaped export bottles. The sales of the seven-ounce bottles labeled "Esslinger" were not good, possibly due to the fact that eight ounces of Esslinger beer from draught cost the customer five cents less than the seven-ounce bottle of the same beer, i.e., five cents more cost for an ounce less of beer. The costs of production were high because the export shaped seven-ounce bottle did not fit in the defendant's bottling machines thus requiring

[ 373 Pa. Page 339]

    a change-over for the filling of such bottles. Breakage also was high and much time was consumed daily in effecting the necessary bottling change-over. As a result, the defendant, in August 1950, adopted the seven-ounce "steinie" shaped bottle, professedly, in order to reduce the breakage and to eliminate the necessity for a change-over in the bottling machines. At the same time, the defendant decided upon a different name for its new seven-ounce bottle and content so as to avoid the possibility of self-competition. The beer remained the same however. The name the defendant chose for the new package was "Goblet". An officer of the company, who had participated in the selection of the new name, testified that he knew that seven-ounce "steinie" bottles bearing the trade name "Goebel" were widely sold in Philadelphia but that, in selecting "Goblet", he had given no thought to Goebel's market. He further stated that the inspiration for "Goblet" as a name for a beer had come from souvenir goblets bearing the trade name "Esslinger" which the defendant had previously distributed to dealers in the Carolinas as a part of a sales campaign there.

The plaintiff, by letter of its attorneys dated December 15, 1950, protested the defendant's use of the name "Goblet" to identify its beer in "steinie" bottles. The exact time the defendant started marketing "Goblet" is not disclosed by the record, but it was some time between its decision in August 1950 to change to "steinie" bottles and adopt the name "Goblet" and the first advertisements of the product, so bottled and labelled, in April of 1951. Part of the defendant's advertising campaign was aimed at retailers and stressed the greater profits to be made by their sale of ...


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