Carter Products, Inc., a Maryland Corporation v. Fleetwood Company, an Illinois Corporation, and Nelson J. McMahon

333 F.2d 464

• Court: Court of Appeals for the Seventh Circuit
• Decided: July 8, 1964
• Docket: 14179_1
• Status: Published

Opinions

SCHNACKENBERG, Circuit Judge.

Carter Products, Inc., a Maryland corporation, plaintiff, has appealed from a judgment in favor of Fleetwood Company, an Illinois corporation, and Nelson J. McMahon, defendants, and an order thereafter entered by the district court to amend its findings of fact.

In its complaint plaintiff sought an injunction against defendants based upon unfair competition, injury to its business reputation, dilution of its trademark¹ and infringement of said trademark.

Wallace Laboratories, a division of plaintiff, is a leading producer of ethical drug products (those sold by physician’s prescription). It markets nationally, including in Illinois, a wide variety of ethical drugs, including preparations to control appetite. Plaintiff acquired the name Wallace in 1933 with its acquisition of Wallace Laboratories.

Wallace Laboratories uses the name Wallace as both a trademark and a trade name to identify itself as the source of its many ethical drug products. These products, which have been widely advertised and sold for decades under the Wallace name, include a great variety of tranquilizers, antidepressants, appetite control preparations and estrogens. These products are distributed through hospitals, drugstores and prescription pharmacies throughout the United States. As found by the district court, the name Wallace is established in the medical and drug professions as a symbol of high quality and reliability.

Defendants’ Wallace Super Dietary Mealz was introduced as a wholly new product on January 2, 1960. It is a dietary supplement in a powdered form, and is designed for consumption in milk in connection with “An Easy Low Calorie Weight Control Plan for High Nutrition and Easier Reducing”. Defendants’ sales of this product are made directly to the lay public by mail order and through drugstores, department stores, dime stores, supermarkets and similar retail outlets. It uses the name Wallace on the Fleetwood letterhead and prominently on the labels of Wallace Super Dietary Mealz, both in the product name and to identify it as “Distributed by Wallace (Div. of Fleetwood Company)”.

Historically, defendants’ use of the name Wallace originated about 1920 when Wallace Rogerson originated and conducted a mail order phonograph record business, selling records containing weight-reducing exercise instructions with musical accompaniment. Probably in 1936, he extended the weight-reducing instruction to a radio program in Chicago which, as well as the phonograph record business, was known by the Wallace Method name and the “Get Thin to Music” slogan.

Upon Rogerson’s death in 1943, his widow continued the mail order record business, which became defendants’ in 1959, when she transferred whatever interest she had to Fleetwood Company.

While the district court by its findings recognized that plaintiff’s mark “Wallace” is favorably established in the medical profession, and that defendant marketed its dietai-y supplement under the name of WALLACE Super Dietary Mealz, the court denied plaintiff relief. It found that plaintiff does not have a trademark registration from the United States patent office, but has registered “Wallace” in Illinois pursuant to the aforesaid chapter 140 of the Illinois statutes.

The court also found that defendant compaixy and its predecessors have used the name Wallace in conjunction with physical exercises through the use of phonographic x-ecords and related px*od-ucts such as reducing bread, wafers, and sweat shirts since 1921. It further found that in 1960 it offered a dietary food supplement under the name of Wallace Super Dietary Mealz, which name was registered in the United States patent office on January 23, 1962. Its sales were through mail orders, supermarkets, grocery stores and drugstores and were secured by direct mail, newspaper or other means of consumer advertising.

We consider it significant that the products of the parties to this case were sold through different channels and in different markets.

The court made a finding that there is “no evidence that any physician or pharmacist was in fact led to believe that Fleetwood’s ‘Wallace Super Dietary Mealz’ was a product of plaintiff nor is there any evidence that either party ever received any inquiries or orders for the other party’s products.” The court further found that there has been no actual confusion between plaintiff’s and defendants’ products, because they are not competitive and the means for distributing and promoting them are substantially different. It concluded that plaintiff’s trademark “ ‘Wallace’ for prescription goods and ethical drugs is not infringed by defendant’s trademark ‘Wallace Super Dietary Mealz’ for a dietary food supplement", and that there “is no basis under common law, the Lanham Act or the appliable Illinois Statutes for enjoining defendants’ use of its trademark ‘Wallace Super Dietary Mealz’ ”.

The court concluded that the complaint should be dismissed without costs. We agree that this disposition of the case is supported by the evidence and the law and, for that reason, the judgment and order from which this appeal was taken are affirmed.

Judgment and Order affinned.

1 . § 22, Ch. 140, Ill.Rev.Stats. (1963).