Unistrut Corporation v. Power

175 F. Supp. 294, 121 U.S.P.Q. (BNA) 381, 1958 U.S. Dist. LEXIS 2970
CourtDistrict Court, D. Massachusetts
DecidedDecember 18, 1958
DocketCiv. A. 54-961
StatusPublished
Cited by3 cases

This text of 175 F. Supp. 294 (Unistrut Corporation v. Power) is published on Counsel Stack Legal Research, covering District Court, D. Massachusetts primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Unistrut Corporation v. Power, 175 F. Supp. 294, 121 U.S.P.Q. (BNA) 381, 1958 U.S. Dist. LEXIS 2970 (D. Mass. 1958).

Opinion

SWEENEY, Chief Judge.

In their bill of complaint the plaintiffs include five distinct causes of action and they will be treated as such. The actions center around the activities of both parties with respect to the production, promotion and sales of articles covered by patents numbered 2,345,650 issued on April 4, 1944, on an application filed on October 12, 1940 and 2,696,139 issued on December 7, 1954, on an application dated May 28, 1952. The complaint alleges (a) unfair competition on the part of the defendants, (b) infringement of the plaintiffs’ patents and (c) infringement of plaintiffs’ copyrights, (d) infringement of plaintiffs’ trademark and (e) breach of contract by the defendants. Injunctions and an accounting of profits and damages are sought. The defendants filed a motion for a declaratory judgment attacking the validity of Patent No. 2,696,139 and this decision will also dispose of that motion.

Findings of Fact

The plaintiffs are Unistrut Corporation, the manufacturer of the Unistrut metal framing system, hereinafter referred to as the Corporation, Unistrut Products Company, hereinafter referred to as the Company, the national distributor, and Charles W. Attwood, the owner of the two patents in suit and president of the Corporation. Unistrut Corporation is the exclusive licensee of the patents in suit. The defendant James F. Power had been the exclusive New England distributor of Unistrut and, as such, did business under the name Uni-strut Service Company of New England.

When, in 1952, the Company changed its franchise policy to grant only nonexclusive distributorships, Power entered into a non-exclusive agreement with the Company. But he became increasingly dissatisfied and in 1954 cancelled this agreement and established his own manufacturing and distributing organizations, Power-Strut, Inc., and Power Products Company, Inc.

The basic Unistrut patent relates “to building and structural elements for the construction of skeletonized reinforcing and supporting structures, ladders, scaffolding, rails, frames, struts and the like,” and its object is “to provide improved means whereby structures of the indicated and other types, of great strength may be erected more quickly and easily than is now possible, with the expenditure of less effort and labor in the field, and without the necessity of drilling or forming the material.”

Both the Unistrut and Power-Strut systems employ slotted channel members with inturned edges which are connected to each other by a clamping nut with grooves and teeth to receive the *297 inturned edge of the channel. The nut is backed by a coil spring to hold it in place and clamped by a threaded bolt which draws the nut tightly against the in-turned edges of the channel member.

Unfair Competition

Several months before he actually can-celled his agreement with the Company, Power began to take steps which eventually led to the establishment of the Power-Strut organization. He solicited other Unistrut distributors and with offers of more advantageous discounts persuaded four of them to join him. These four represented a total Unistrut market of about one million dollars annually. He prepared a catalog which listed, in addition to Power-Strut parts, Unistrut equivalent parts numbers and which included pictures of Unistrut installations which were not identified as such. He sub-contracted with Van Huifel Tube Company, a former Unistrut supplier, for the manufacture of channels and nuts.

Power-Strut channels are very similar in design, color and size to Unistrut channels. They differ in shape from Unistrut only in that the inturned edges of the latter are bevelled, as compared with the flat or rounded edge of Power-Strut. The original supply of Power-Strut channels consisted of those sizes which were the most popular of the Uni-strut line. The original Power clamping nut was admittedly an exact duplication of the Unistrut nut. Even Power-Strut’s parts numbers were, in part, assimilated from Unistrut; e. g. Unistrut’s P-1000 was equivalent in size and shape to Power-Strut’s PS-100.

In considering the question of unfair competition I must apply the law as the Massachusetts Courts would apply it, Erie Railroad Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188; Fashion Originators’ Guild of America v. Federal Trade Commission, 312 U.S. 457, 468, 61 S.Ct. 703, 85 L.Ed. 949, and under Massachusetts law the passing off of one’s own goods as those of another with the result that the public is deceived, is clearly included within the definition of unfair competition. Summerfield Co. of Boston v. Prime Furniture Co., 242 Mass. 149, 136 N.E. 396; Healer v. Bloomberg Bros., 321 Mass. 476, 73 N.E.2d 895; Man-Sew Pinking Attachment Corp. v. Chandler Mach. Co., D.C. Mass., 33 F.Supp. 950. Power set out to deceive and succeeded in deceiving the public. The listing of equivalent parts numbers and the very similarity between parts numbers created the impression that Power-Strut was merely a less expensive line of Unistrut. The fact that Power continued to list Unistrut Products Company of New England in the telephone book for several years undoubtedly helped to strengthen that impression. The plaintiff at the trial adduced evidence of at least two instances where former Unistrut customers had received Power-Strut installations, not knowing that they were not getting Uni-strut products. Power’s testimony that all Unistrut customers were notified of the divorce of Power from Unistrut is not supported by the evidence. While the defendant did mail a letter announcing the new Power line, the letter makes no mention of the completely different origins of Power and Unistrut.

Many activities that are properly labelled “unfair competition” arise through ignorance of legal rights of others, through overzealous efforts to promote a product, or through mistaken belief in the line between fair and unfair competitive activities. But this ease cannot be included in any of those categories. Here we have a well calculated plan, both in conception and in execution, to steal from the plaintiff much of its good will, to ride on the skirts of a reputation already established, to fool and mislead the public into believing that the defendants’ products originated with the plaintiffs’ and to divert into the defendants’ own pockets the profits which would probably have accrued to the plaintiffs, except for the defendants’ acts. These activities were unfair to the plaintiff as well as to the general public. They were dishonest. I find for the plaintiffs on this cause of action.

*298 The plaintiffs have also argued that there has been a breach of the fiduciary-duty owed by Power to Unistrut as a result of the agency relationship. But since no such allegation was included in the pleadings, I will disregard this argument except as it bears indirectly on the charge of unfair competition.

Patent Infringement

The defendants allege with respect to the first patent, the basic Unistrut patent, No. 2,345,650, that their product does not infringe, but if it does infringe the patent, the latter is invalid, having been anticipated by the prior art.

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Cite This Page — Counsel Stack

Bluebook (online)
175 F. Supp. 294, 121 U.S.P.Q. (BNA) 381, 1958 U.S. Dist. LEXIS 2970, Counsel Stack Legal Research, https://law.counselstack.com/opinion/unistrut-corporation-v-power-mad-1958.