World, Inc., 645 F. Supp. 1015, 1022 (D.N.J. 1986).
49. Subliminal confusion has been defined as "defendants' ability to gain a foothold in plaintiff's market by exploiting subliminal or conscious association with plaintiff's" protected name or mark. Playboy Enterprises, 486 F. Supp. at 428.
50. As the second comer, BDC has a duty to choose a mark or trade name so as to avoid all confusion as to the source of origin of its services. Johnson & Johnson v. Quality Pure Mfg., Inc., 484 F. Supp. 975, 980 (D.N.J. 1979).
51. If denied injunctive relief, Carnival will have its reputation and goodwill placed in the hands of the plaintiff Carnival entities, whose financial structure and organization have yet to be approved by the New Jersey Casino Control Commission. This is sufficient for a court to enjoin plaintiff from the use of the mark even absent evidence of product inferiority.
52. Injunctions are appropriate in trademark cases where the reputation of the senior user "is left to the mercy of the junior user, whose business policies may not reflect the same sound judgment." Miss Universe v. Little Miss U.S.A. Inc., 212 U.S.P.Q. 423 (N.D. Ga. 1980).
53. Carnival is a house mark or umbrella mark which relates to all the services Carnival provides. See 1 McCarthy, Trademarks and Unfair Competition, § 9:6, p. 315 (2d Ed.); 1 Gilson, Trademark Protection and Practice, § 1.02, pp. 1-11 (1986); 3 Callman, Unfair Competition, Trademarks and Monopolies, § 17.15, pp. 59-60 (4th Ed.)
54. The fact that Carnival is a Panamanian corporation and that its casinos only operate outside the United States territorial waters is irrelevant.
55. Where a mark is known in the United States, or where it is advertised in the United States and the acts of an American trademark infringer constitutes unfair competition against the foreign trademark owner, American courts will grant protection. Callman, Unfair Competition, Trademarks and Monopolies, § 19.24, p. 75 (4th Ed.).
56. Use by BDC of "Carnival Club" and/or "Carnival" infringes Carnival's common law trademark rights in its "Carnival" marks and constitutes common law unfair competition.
57. In a diversity case, the District Court must apply the choice of law rules of the forum state in determining which state's law applies. Klaxon Co. v. Stentor Electric Mfg. Co., Inc., 313 U.S. 487, 61 S. Ct. 1020, 85 L. Ed. 1477 (1941); Melville v. American Home Assurance Co., 584 F.2d 1306, 1308 (3d Cir. 1978); Suchomajcz v. Hummel Chem. Co., 524 F.2d 19 (3d Cir. 1975).
58. Since Pennsylvania is the forum state, its conflicts rules will be used in choosing which state's common law applies as to the torts of unfair competition and trademark infringement.
59. The law of Pennsylvania or Florida or New Jersey is potentially applicable to this case. Pennsylvania is where BDC has its principal place of business. Florida is where Carnival has its principal place of business. New Jersey is where BDC is incorporated, and where Blumenfeld intends to establish a hotel/casino with the alleged infringing designation "Carnival Club" and/or "Carnival." Injury is likely to occur in all states if BDC uses this designation.
60. The landmark Pennsylvania decision in a tort action choice of law case is Griffith v. United Air Lines, Inc., 416 Pa. 1, 203 A.2d 796 (1964). In Griffith, the Supreme Court of Pennsylvania abandoned the traditional lex loci delicti rule in favor of a more "flexible" approach to choice of law which "permits analysis of the policies and interests underlying the particular issue before the court." Id. at 21, 203 A.2d at 805.
61. In Cipolla v. Shaposka, 439 Pa. 563, 267 A.2d 854 (1970), the court stated that one method in determining which state has a greater interest in the application of its law, is to examine the relevant contacts each state has with the tort. This should not be a mere quantitative counting of contacts, but rather a qualitative determination of which state has the more substantial interest in having its law applied. Id. at 566, 267 A.2d at 856. Applying that analysis, the court finds New Jersey law should be applied.
62. New Jersey courts have long protected trademark rights under the doctrine of unfair competition. American Shops, Inc. v. American Fashion, etc., Inc., 13 N.J. Super. 416, 80 A.2d 575 (App. Div. 1951), cert. denied, 7 N.J. 576, 83 A.2d 379 (1951).
63. In New Jersey, the common law test for unfair competition and infringement is likelihood of confusion, which is also the test for federal unfair competition. Perfectform Corp. v. Perfect Brassiere Co., Inc., 256 F.2d 736, 741 (3d Cir. 1958), cert. denied, 358 U.S. 919, 3 L. Ed. 2d 238, 79 S. Ct. 287 (1958); Red Devil Tools v. Tip Top Brush, Inc., 50 N.J. 563, 236 A.2d 861, 157 U.S.P.Q. 456, 458 (1967); Estate of Presley v. Russen, 513 F. Supp. 1339, 1361-1362 (D.N.J. 1981); Great Atlantic & Pacific Tea Co. v. A & P Trucking Corp., 29 N.J. 455, 149 A.2d 595, 597 (1959).
64. New Jersey common law looks to the same ten factors in determining likelihood of confusion as are looked at in determining likelihood of confusion under federal unfair competition. Caesar's World, 490 F. Supp. at 823-824.
65. BDC's conduct, including wrongful copying and appropriation of Carnival's mark in direct competition with Carnival, amounts to unfair competition and trademark infringement under New Jersey law.
Because there has been no substantial commercial use by defendant of the name "carnival," no actual damages are probable.
The claim for punitive damages is denied.
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