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BRODY'S v. BRODY BROTHERS (12/30/82)

SUPERIOR COURT OF PENNSYLVANIA


filed: December 30, 1982.

BRODY'S, INC., TRADING AS BRODY'S, APPELLANT,
v.
BRODY BROTHERS, INC., TRADING AS BRODY'S

No. 370 Pittsburgh, 1980, Appeal from the Order of the Court of Common Pleas, Civil Division, of Clarion County, 1979, No. 7 - Equity.

COUNSEL

Benjamin G. McFate, Oil City, for appellant.

Wayne A. Kablack, Indiana, for appellee.

Price, Cavanaugh and Watkins, JJ.

Author: Price

[ 308 Pa. Super. Page 419]

This appeal is from an order that both cancelled appellant Brody's, Incorporated's Pennsylvania registration of the trade name "Brody's", and refused to permanently enjoin appellee Brody Brother's, Incorporated from using the same trade name.

Appellant Brody's, Incorporated ("Oil City Brody's") is a Pennsylvania corporation with its principal place of business in Oil City, Pennsylvania, where since 1939 it has operated a women's and children's clothing store under the name "Brody's". Appellee Brody Brothers, Incorporated ("Indiana Brody's"), also a Pennsylvania corporation, has operated a clothing store for men, women and children in Indiana, Pennsylvania since 1913, also using the name "Brody's". The principals in appellee and appellant corporations are members of the same Brody family responsible for founding both independent entities in the early part of this century. Oil City and Indiana are Western Pennsylvania cities located about 90 miles apart.

The present controversy arises out of appellee Indiana Brody's decision to open a new "Brody's" store in the

[ 308 Pa. Super. Page 420]

Clarion Mall. The Clarion Mall, near Clarion, Pennsylvania, is located approximately 25 miles southeast of Oil City, and about 60 miles north of Indiana. Oil City Brody's moved for a preliminary injunction alleging that use of the "Brody's" trade name in such close proximity to its own store would constitute trade mark infringement and unfair competition. The motion was denied because the mall was not scheduled to open soon enough to cause any immediate harm. Oil City Brody's subsequent motion for a permanent injunction was granted, but the full relief requested was not given. While Oil City Brody's had sought to prevent any use of the term "Brody's" in connection with the Clarion Mall Store, the trial court expressly reserved to appellee the right to use its full corporate name, "Brody Brothers, Inc." but prohibited any use or emphasis of the single term "Brody" or "Brody's". Each party filed exceptions to this order, and upon rehearing, the court below dissolved the order and on April 7, 1980 entered a new order denying the injunction, and allowing appellee to use the trade name "Brody's" for its Clarion store.

Oil City Brody's appeals from the April 7 order, asserting two grounds of error in the trial court's denial of injunctive relief. First appellant advances trade name rights inherent in its December 20, 1978 registration of the name "Brody's", in accordance with the Act of May 29, 1956, P.L. (1955) 1855, § 1, 73 P.S. § 15, and argues that the court below improperly cancelled the registration. Second, appellant contends that an injunction is mandated under Pennsylvania's common law of trade marks and unfair competition. We disagree on both counts and affirm.

The lower court correctly precluded Oil City Brody's assertion of statutory rights by canceling its registration of the trade name "Brody's",*fn1 in accordance with 73 P.S. § 20.

The statute providing for registration of trade marks and service marks in Pennsylvania requires that all applications for registration must include a statement, made under oath,

[ 308 Pa. Super. Page 421]

    that the applicant is the owner of the trade-mark or service-mark and that no other person has the right to use such trade-mark or service-mark in this Commonwealth, either in the identical form thereof or in any such near resemblance thereto as might be calculated to deceive or to be mistaken therefor.

73 P.S. § 15.

A review of the record leaves no doubt but that the proprietors of Oil City Brody's, at the time it filed a trade mark application for "Brody's", had for a long time been aware that Indiana Brody's (as well as several businesses in other areas of Western Pennsylvania) was operating a clothing store under the same name. This contradicts appellant's sworn statement that "no other person has the right to use" the same or a closely similar mark in Pennsylvania. The Commonwealth's trade mark registration statute provides for the Secretary of the Commonwealth to cancel "[a]ny registration concerning which a court of competent jurisdiction shall find: . . . (d) that the registration was obtained fraudulently" 73 P.S. § 20(4).*fn2 Accordingly we hold that the court below properly ordered cancellation of appellant's trade name registration, and appellant is therefore barred from asserting any rights that would otherwise result from registration of the mark.

Respecting Oil City Brody's remaining claim, we note initially that normally under Pennsylvania common law, an injunction will be granted to protect the trade name of a plaintiff who can prove the following three things: first, the plaintiff's right to exclusive use of the name; second, the defendant's use of a name confusingly similar to that name; and third, a likelihood of confusion in plaintiff's competitive area caused by the defendant's use. Zimmerman v. Holiday Inns of America, Inc., 438 Pa. 528, 534-35, 266 A.2d 87, 90 (1970), cert. denied 400 U.S. 992, 91 S.Ct. 456, 27 L.Ed.2d 440 (1971). In the instant case there is no question

[ 308 Pa. Super. Page 422]

    as to the second element, (similarity of the names); both parties claim the right to use an identical trade name, "Brody's". Normally, then, we would focus on the two remaining issues comprising the test for infringement, namely whether Oil City Brody's has proven its right to exclusive use of the trade name "Brody's" in the area of the proposed Clarion Mall Store, and whether the appellee's use of that name in the Clarion Mall is likely to cause confusion as to the source of the services offered there.

However, the test for infringement is completely different under Pennsylvania law when, as in the instant case, the trade name sought to be enjoined is also the personal name of the party using it.*fn3 In such cases, the

[ 308 Pa. Super. Page 423]

    otherwise central issue of likelihood of customer confusion bows to the doctrine that:

[e]very man has the absolute right to use his own name in his business, even though he may thereby interfere with and injure the business of another bearing the same name; provided he does not resort to any artifice, or do any act calculated to mislead the public as to the identity of the establishments, and to produce injury to the other beyond that which results from the similarity of the names.

Seligman v. Fenton, 286 Pa. 372, 375, 133 A. 561, 562 (1926). The most recent Pennsylvania Supreme Court decision*fn4 concerning the use of one's personal name as a trade

[ 308 Pa. Super. Page 424]

    name is the 1940 case of Ralph Brothers Furniture Company v. Ralph, 338 Pa. 360, 12 A.2d 573, in which the court maintained: "The principle is fundamental that an individual is entitled to the use of his own name in his business, unless he has by contract deprived himself of that right." Id., 338 Pa. at 363, 12 A.2d at 574.*fn5 We extended the right to include cases such as the instant case, one in which an incorporator's personal name is used by a corporation. John H. Gates v. Gates Coal Company, Inc., 114 Pa. Superior Ct. 157, 174 A. 3 (1934).

[ 308 Pa. Super. Page 425]

Applying the above principles to the present case, we are compelled to conclude that, even if appellee's use of its incorporators' family name "Brody's" in the Clarion Mall presents a likelihood of confusion with appellant's name, the use is permitted absent any artifice or act calculated to mislead the public on the part of appellee. Here the evidence supports the chancellor's conclusion that appellee Indiana Brody's employed no artifice or act calculated to deceive the public by proposing to use the name "Brody's" in its Clarion Mall Store. To the contrary, here, as in Seligman v. Fenton, supra, there was an express finding of good faith on the part of appellee. Slip. Op. April 7, 1980 at 5. Therefore any commercial harm experienced by appellant Oil City Brody's results from a lawful act of appellee Indiana Brody's: "such inconvenience or loss as may result from an honest use of a person's name in his business, by reason of its interference with the business of another having the same name, is regarded as damnum absqua Page 425} injuria." Seligman v. Fenton, 286 Pa. 372 at 375, 133 A. 561 at 562.

Accordingly, the order denying the motion for a permanent injunction is affirmed.


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