Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

CAPITAL BONDING CORP. v. ABC BAIL BONDS

September 30, 1999

CAPITAL BONDING CORP.
v.
ABC BAIL BONDS, INC. AND LEXINGTON NATIONAL INSURANCE CO.



The opinion of the court was delivered by: Dalzell, District Judge.

MEMORANDUM

A bail bond company has sued a rival for, inter alia, trademark infringement, and has filed a motion for a preliminary injunction to stop it. The rival has moved to dismiss.

This memorandum will constitute our findings of fact and conlusions of law under Fed.R.Civ.P. 52(a) as to the preliminary injunction motion. For the reasons that follow, we will deny both motions.

I. FACTS

Plaintiff Capital Bonding Corp. ("Capital") is a Reading-based company that sells bail bonds in much of the country. Until 1997, the firm operated as a sole proprietorship under the name "Vincent J. Smith Bail Bonds". Smith two years ago elected to incorporate his business, to which he was introduced and learned from boyhood at the knee of his grandmother. Together with his wife, Smith owns all of the common stock of Capital.

ABC Bail Bonds, Inc. ("ABC") is a relatively new firm, having been formed by its principal, and current president, Ronald Jacob Yellin, as the sequel to a number of pawn shops and check cashing agencies that Yellin had operated for many years. Yellin began the bail bond business in 1995 and, like Capital, it has to date proved to be a successful and fast-growing enterprise.

Although Capital operates directly and indirectly in at least thirty states, it is undisputed that It competes with ABC in the counties of Eastern Pennsylvania and throughout New Jersey, where ABC is based in the state capital. Both firms serve the same market, which ranges from lawyers to non-literate, non-English-speaking defendants and their families and friends. Both provide the financial guarantees most people associate with such firms, but both also provide the less commonly thought-of service of, as Yellin put it, "fugitive recovery".*fn1

Capital on August 31, 1999 filed this action for trademark infringement and unfair competition under the Lanham Act, 15 U.S.C. § 1051 et seq., and Pennsylvania law.*fn2 Capital alleges that the Yellow Pages ads of ABC infringe its "distinctive" logo, which it has registered with the Patent and Trademark Office. Capital's logo consists of a muscular, serious-looking man dressed in tattered prison garb bending apart the bars of a prison cell (the "Capital image").*fn3 ABC's image features a cartoon prisoner dressed in an old-fashioned prison uniform, gleefully stepping through a hole in a brick wall (the "ABC image").*fn4

Capital seeks to preliminarily enjoin ABC from using the ABC image. It also wants ABC to relinquish all of the telephone numbers that it has advertised in connection with the image, relief which would likely put ABC out of business, according to Yellin.*fn5

After affording the parties a brief time for expedited discovery, we held a hearing on the preliminary injunction motion on September 27-28, 1999.

II. Capital's Motion for a Preliminary Injunction

When ruling on a motion for a preliminary injunction, we must consider four factors: (1) the likelihood that plaintiff will prevail on the merits at final hearing; (2) the extent to which plaintiff is being irreparably harmed by the conduct complained of; (3) the extent to which defendant will suffer irreparable harm if the preliminary injunction is issued; and (4) the public interest. See, e.g., Pappan Enters. v. Hardee's Food Sys., Inc., 143 F.3d 800, 803 (3d Cir. 1998). Because we find that the likelihood that Capital will prevail on its trademark infringement claim is very slim, we need not reach the last two inquiries.

A. Capital's Likelihood of Success on the Merits

To succeed on a claim for trademark infringement,*fn6 a plaintiff must establish three elements:

1. The mark is valid and legally protectable;

2. The mark is owned by the plaintiff; and

  3. The defendant's use of the mark to identify goods
     or services is likely to create confusion
     concerning the origin of the goods or services.

See, e.g., Fisons Horticulture, Inc. v. Vigoro Indus., 30 F.3d 466, 472 (3d Cir. 1994); Opticians Ass'n of Am. v. Independent Opticians of Am., 920 F.2d 187, 192 (3d Cir. 1990).

1. Validity and Legal Protectability of the Mark

The first element of a trademark infringement claim — the validity and legal protectability of the mark — is proven where a mark is federally registered and has become "incontestable" under the Lanham Act, 15 U.S.C. § 1065.*fn7 Because Capital cannot establish that its mark is incontestable (because it has not been in continuous use for five consecutive years), the Capital image is valid and legally protectable only if it has acquired "secondary meaning" or is "inherently distinctive.". See, e.g., Ford Motor Co. v. Summit Motor Prods., Inc., 930 F.2d 277, 291 (3d Cir. 1991).

Capital has a certificate of registration for its mark, see Compl. exh. B, which is "prima facie evidence of the validity of the registered mark and of the registration of the mark, of the registrant's ownership of the mark, and of the registrant's exclusive right to use the registered mark in commerce on or in connection with the goods or services specified in the certificate," 15 U.S.C. § 1057(b). At the preliminary injunction hearing, however, Capital proffered no actual evidence that would suggest that Capital's image has acquired either secondary meaning or is inherently distinctive.

a. Secondary Meaning

Secondary meaning is demonstrated where, "in the minds of the public, the primary significance of a product feature or term is to identify the source of the product itself." Ford, 930 F.2d at 292 (quoting Freixenet, S.A. v. Admiral Wine & Liquor Co., 731 F.2d 148, 152 (3d Cir. 1984)). It is generally established "through extensive advertising which suggests that the products originate from a single source." Scott Paper Co. v. Scott's Liquid Gold, Inc., 589 F.2d 1225, 1228 (3d Cir. 1978). A non-exhaustive list of factors that may be relevant to the issue of whetheramark has acquired secondary meaning in the market includes the extent of sales and advertising leading to buyer assoiation, the length and "exclusivity of use, the fact of copying, customer surveys and testimony, the use of the mark in trade journals, the size of the company, the number of sales, the number of customers, and actual confusion. See Ford, 930 F.2d at 292.

Capital has produced nothing that would suggest that its image has acquired secondary meaning in the marketplace. To the contrary, the parties have stipulated that Capital has only been in existence since January of 1997 and only began using its image in July of 1997, just slightly more than two years ago.*fn8 Capital has offered nothing to show that its image has achieved secondary meaning in that brief period of time; to the contrary, its president testified at the, hearing that Capital actually stopped using the logo in the Yellow Pages, although it is undisputed that such advertising is an important source "of business in the bail bond industry. Cf. Guardian Life Ins. Co. v. American Guardian Life Assurance Co., 943 F. Supp. 509, 525 (E.D.Pa. 1996) ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.