Pennsylvania State University v. University Orthopedics, Ltd.

706 A.2d 863, 1998 Pa. Super. LEXIS 11
CourtSuperior Court of Pennsylvania
DecidedJanuary 14, 1998
StatusPublished
Cited by38 cases

This text of 706 A.2d 863 (Pennsylvania State University v. University Orthopedics, Ltd.) is published on Counsel Stack Legal Research, covering Superior Court of Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Pennsylvania State University v. University Orthopedics, Ltd., 706 A.2d 863, 1998 Pa. Super. LEXIS 11 (Pa. Ct. App. 1998).

Opinion

CAVANAUGH, Judge.

This is an appeal from an order which granted Appellee University Orthopedics’ (“UO”) motion for summary judgment and dismissed the action filed by Appellant Pennsylvania State University (“PSU”). We reverse and remand.

UO is a professional medical corporation located in State College, Pennsylvania, which provides orthopedic and sports medicine services. PSU is a state-supported institution of higher education based in State College, Pennsylvania, which, through its College of Medicine, operates a network of health care facilities throughout the State College and central Pennsylvania area. Through the Penn State Center for Sports Medicine located in State College, PSU offers orthopedic and sports medicine services to the general public.

The dispute in this case arose over UO’s use of the word “university” in conjunction with its medical practice. PSU’s health care services are grouped under the name “University Health Services” and it employs the word “university” in connection with many of the medical services it offers. PSU alleged the use of “university” by UO was designed to cause consumers of medical services to believe that UO was affiliated with PSU. UO has used “university” not only as part of its logo, but in a variety of promotional materials and advertisements.

In 1992, in order to minimize consumer confusion, PSU and UO executed a “Release Agreement.” In exchange for PSU agreeing not to sue to enforce its common law rights, UO agreed to include a disclaimer that it is not affiliated with PSU in all its advertisements and literature. Despite this agreement, PSU alleged that UO subsequently failed to include the required disclaimer on a number of its advertisements. It further alleged that UO’s use of “university” continued to cause confusion among medical service consumers.

On December 9, 1994 PSU filed an equity action against UO seeking injunctive relief and damages. PSU’s complaint contained four counts: count 1 — breach of contract; count 2 — unfair competition by infringement of common law rights; count 3 — violation.of Pennsylvania’s anti-dilution statute; and count 4 — violation of § 43(a) of the Trademark Act of 1946 (“Lanham Act”). After the pleadings closed, UO filed a motion for summary judgment and PSU filed a cross-motion for partial summary judgment on its breach of contract claim. The trial court granted UO’s motion as to all four counts and dismissed PSU’s complaint.

With respect to PSU’s claim of unfair competition and trademark infringement, the court found that PSU failed to raise a “pass *867 ing off’ theory of liability. 1 As such, it concluded that PSU was required to prove that it had a legal right to the exclusive use of the word “university.” The court then found that “university” was a generic term and that UO was entitled to summary judgment on the issues of unfair competition and trademark infringement. The court also concluded that summary judgment was appropriate on the breach of contract claim because the Release Agreement was not enforceable. The court reasoned the agreement was not supported by consideration because PSU’s promise not to sue was illusory, as it had no proprietary right to the word “university.” Following the entry of summary judgment, PSU filed this appeal.

When reviewing the grant of summary judgment, our scope of review is plehary. American States v. Maryland Casualty, 427 Pa.Super. 170, 180, 628 A.2d 880, 885 (1993).

[A] motion for summary judgment may be granted only if “the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” In passing on a motion for summary judgment, this Court will view the record in the light most favorable to the non-moving party.... Summary judgment is appropriate only in those cases which are free from doubt.

Dublin by Dublin v. Shuster, 410 Pa.Super. 1, 5, 598 A.2d 1296, 1298 (1991). “[T]he grant of summary judgment will only be reversed for an error of law or a clear abuse of discretion.” Carns v. Yingling, 406 Pa.Super. 279, 282, 594 A.2d 387, 339 (1991) (citations omitted).

We begin with an examination of PSU’s claim for relief under federal law— § 43(a) of the Lanham Act, 15 U.S.C. § 1125(a). 2 PSU argues the court erred in entering summary judgment in favor of UO on this claim on the basis of the trial court’s incorrect conclusion that PSU cannot claim an exclusive right to use of the word “university.” PSU maintains that even if “university” is a generic term, it has, nonetheless, pled sufficient facts and produced sufficient documentary evidence to show “passing off” and preclude the entry of summary judgment on a § 43(a) claim. 3 We agree.

A claim of unfair competition encompasses trademark infringement, but also includes a broader range of unfair practices, which may generally be described as a misappropriation of the skill, expenditures and labor of another. Murphy Door Bed Co. v. Interior Sleep Systems, 874 F.2d 95, 102 (2d Cir.1989).

Federal courts have long held that § 43(a) of the Lanham Act extends protection to unregistered trademarks on the principle that unlicensed use of a designation serving the function of a registered mark constitutes a false designation or representation. A designation may only receive protection, however, if the public recognizes it as identifying the claimant’s *868 “goods or services and distinguishing them from those of others.” 1 J. McCarthy, Trademarks and Unfair Competition § 15:1 at 667 (2d ed.1984). Such identification depends, in the first instance, on a designation’s level of inherent distinctiveness, and for this purpose, courts have divided designations into four categories: arbitrary (or fanciful) terms, which bear “no logical or suggestive relation to the actual characteristics of the goods;” suggestive terms, which suggest rather than describe the characteristics of the goods; descriptive terms, which describe a characteristic or ingredient of the article to which it refers, and generic terms, which function as the common descriptive name of a product class. Keebler Co. v. Rovira Biscuit Corp., 624 F.2d 366, 374 n. 8 (1st Cir.1980).

A.J. Canfield Co. v. Honickman, 808 F.2d 291, 296 (3d Cir.1986). Arbitrary or suggestive marks are considered inherently distinctive and automatically qualify for trademark protection; while descriptive marks are afforded such protection only where “secondary meaning” — that consumers identify the term with the claimant — is proven. Genesee Brewing Co., Inc. v.

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Bluebook (online)
706 A.2d 863, 1998 Pa. Super. LEXIS 11, Counsel Stack Legal Research, https://law.counselstack.com/opinion/pennsylvania-state-university-v-university-orthopedics-ltd-pasuperct-1998.