Petition — Vision Center v. Opticks, Inc.

IN THE

Supreme Court of the United States

OCTOBER TERM, 1979

“79-684

THE VISION CENTER,

Petitioner

versus

OPTICKS, INC., WILL ROSS, INC.

and G. D. SEARLE & CO.,

Respondents

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

William W. Messersmith, III

4700 One Shell Square

New Orleans 70139

Attorney for Petitioner

Bernard Marcus

Deutsch, Kerrigan & Stiles

Of Counsel

SCOFIELDS' QUALITY PRINTERS, P. 0. BOX 53096, N. O., LA. 70153 - 504/822-1611

— ~ es

INDEX

Page

ee eee rr eee ee eee 1

I ES I Oe ee 2

BOOST ETE TP TT Tee Ee EE 2

ee et ee cess becccccesccccess 3

bese edecsccesece 3

Reasons for Allowing the Writ .............0006- 5

1. The decision below, both in failing to

consider the issue of likelihood of con-

fusion and in holding that the addi-

tion of a prefix to a trade name ab-

solves the user from findings of decep-

tion and unfair competition, conflicts

with the guidelines set forth by this

Court in Hanover Star Milling Co. vs. Met-

calf, 240 U.S. 403 (1916), as well as

with decisions of the other Circuits

and the Fifth Circuit’s own earlier

EE 5

2. The decision below, in failing to pro-

tect a local first user’s trade name and

in holding that secondary meaning

cannot be established through long

usage, conflicts with this Court’s de-

cision in American Trading Co. vs. H. E.

Heacock Co., 285 U.S. 247 (1932), and

with decisions of the other Circuits. ...... 8

il

INDEX (Continued)

Page

3. The holding of the Court below, that

actual fraud must be established be-

fore a trade name may be protected, is

contrary to all law governing protec-

tion of trade names, and, unless re-

versed, will cause uncertainty and

confusion in the law governing trade

mame protectiON. .......eeeeeeeeee ceeees 9

PE oo 5c sao weeks cards keer dereaee res 11

CN oe oa an ab ea at he ee ARERR ees CFS 12

Appendix A — Opinion of the Court

ener re SAE ee ees ee yer ey la

Appendix B — Judgment of Court

Se ere rere rer rrr Terres a 20a

Appendix C — Court of Appeals’ Denial

Ler eer recor rrr rT rte tr. or 21a

Appendix D — Opinion of the District

OE ei isin oa 5 5i4 saws shape eseerenaetees 23a

AUTHORITIES

Cases:

Abercrombie & Fitch Co. vs. Hunting World,

Inc., 537 F.2d 4 (CA 2-1976) .......eeeee cence 8

American Trading Co. vs. H. E. Heacock Co.,

205 UG. BOF CAGE) 6 ods a iveieccisesesa see 3,8,9

ARATE a8

iii

AUTHORITIES (Continued)

Continental Motors Corp. vs. Continental

Aviation Corp., 375 F.2d 857 (CA 5-1967)...... 6

G. & C. Merriam Co. vs. Saalfield, 198 Fed.

369 (CA 6-1912) aff’d and modified, 238

Fed. 1 (CA 6-1917), cert. denied 243 U.S.

Oe CNT ohh ae ees Na eek RRR ek 9

Handy vs. Commander, 49 La.Ann. 1119, 22

i ee SEE CRCL Wii eke bine chdben been hae 11

Hanover Star Milling Co. vs. Metcalf, 240 U.S.

Se TAPE he bak kaw ckwinnesenateweeians y Fy Pe GI

Jenkins Publishing Co. vs. Metalworking Pub-

lishing Co., 315 F.2d 955 (CCPA-1963) ........ 7

Kellogg Co. vs. National Biscuit Co., 305 U.S.

Se Caner cet Chae kd BAAS Ge ee ore oak 9

Safeway Stores, Inc. vs. Safeway Properties,

Inc., 307 F.2d 495 (CA 2-1962) ....cccas ceess 6,9

Scarves By Vera, Inc. vs. Todd Imports, Ltd.

(Inc.), 544 F.2d 1167 (CA 2-1976) ....... 2.005. 6

Standard International Corp. vs. American

Sponge and Chamois Co., 394 F.2d 599

I ee ae ee ikas 9

Straus Frank Co. vs. Brown, 246 La. 999, 169

ee en ace baw ks 10

T.G.I. Friday’s Inc. vs. International

Restaurant Group, Inc., 569 F.2d 895 (CA 5-

1978), aff’g 405 F.S. 698 (MD La.-1975)_ ..... 10

ee ee

iv IN THE

AUTHORITIES (Continued) SUPREME COURT OF THE UNITED STATES

Page OCTOBER TERM, 1979

The Dynasty Room, Inc., d/b/a Whiskey A-

Go-Go vs. Whiskey A-Go-Go, 186 So.2d No

402 (La. App. € 2006) 2... .a55.i0 eee - |

Tisch Hotels, Inc. vs. Americana Inn, Inc., 350

F.2d 609 ECA 9-3008) ...5.ckcan sea 6 THE VISION CENTER,

Union Carbide Corp. vs. Ever-Ready, Incor- sirname

porated, 531 F.2d 366 (CA 7-1976) ............ 8

, versus

United Drug Co. vs. Theodore Rectanus Co.,

348-U-S. 90 (1918) ..0:6.0 ssiecativigweneeeanes 8 OPTICKS, INC., WILL ROSS, INC.,

Volkswagenwerk, AG vs. Rickard, 492 F.2d | and G. D. SEARLE & CO.,

£70 (CA S-1978) nc auatucunte eee 9 ere

World Carpets, Inc. vs. Dick Littrell’s New

World Carpets, 438 F.2d 482 (CA 5-1971) ...... 7 PETITION FOR A WRiT OF CERTIORARI TO

Statutes: THE UNITED STATES COURT OF APPEALS

28 U.S.C. 1256 ...<:::5550seulte een 2 ahs iota cial

Rule S2(a), PROP ...c.wiskcsnesdeaeeeueenee 3,9

Petitioner prays that a writ of certiorari issue to

review the judgment herein of the United States Court

4 of Appeals for the Fifth Circuit entered in the above-

entitled case on May 23, 1979, petition for rehearing

denied on August 1, 1979.

OPINIONS BELOW

The opinion of the District Court, granting a

preliminary injunction to Petitioner (hereinafter some-

2

times referred to as “The Vision Center”), with detail-

ed findings of facts and conclusions of law, is reported

at 461 F.S. 835 and is reproduced as Appendix D, pp.

23a-41a. The Court of Appeals reversed the District

Court with instructions that the preliminary injunc-

tion be dissolved and that an order issue requiring

Respondents to place the identifying prefix “Pearle” be-

fore the phrase “Vision Center” on all its signs and

advertisements in the New Orleans area. The opinion

of the Court of Appeals is reported at 596 F.2d 111 and

is reproduced as Appendix A, pp. 1a-19a, and the order

denying rehearing appears as Appendix C, pp. 21a-23a.

JURISDICTION

The opinion and judgment of the United States

Court of Appeals was entered May 23, 1979. Petition

for rehearing was denied on August 1, 1979. Jurisdic-

tion of this Court is invoked under 28 U.S.C. §1254(1).

QUESTIONS PRESENTED

1. Whether the opinion below failed to consider the

controlling issue of a trade name case — the likelihood

of confusion between the names, and whether the

opinion below violates the guidelines in Hanover Star

Milling Co. vs. Metcalf, 240 U.S. 403 (1916), in which this

Court held that the trade name “Hanover Tea Rose”

was entitled to protection by injunction against use of

the similar name “Steeleville Tea Rose”.

ME ep sone

Home RH PD.

3

2. Whether the findings of the District Court

should have been sustained inasmuch as (i) the name

“The Vision Center” was entitled to trade name pro-

tection because, as held in American Trading Co. vs. H. E.

Heacock Co., 285 U.S. 247 (1932), of its long use in the

local market, (ii) the name “The Vision Center” had ac-

quired a secondary meaning in its market area and (iii)

because those findings were not clearly erroneous.

3. Whether the holding in the opinion below, that

under Louisiana law actual fraud must be established

before a trade name may be protected is erroneous and

if permitted to stand will cause uncertainty and con-

fusion in the law governing protection of trade names.

STATUTE INVOLVED

Federal Rules of Civil Procedure, Rule 52(a) provides:

“ _. Findings of fact shall not be set aside

unless clearly erroneous, and due regard shall

be given to the opportunity of the trial court

to judge the credibility of the witnesses. . .”

- STATEMENT OF THE CASE

The Vision Center sued in state court in Louisiana for

injunction against Respondents’ use of the word com-

bination “Vision Center” in any part of Respondents’

trade name. After the case was removed, the United

States District Court for the Eastern District of

4

Louisiana, on August 25, 1978, enjoined Respondents’

use of the combination of the words “Vision” and

“Center” in their trade name and submitted support-

ing Findings of Fact and Conclusions of Law. It is the

reversal by the United States Court of Appeals for the

Fifth Circuit of this injunction which is the subject of

this petition for certiorari.

The Vision Center started using that trade name in

the New Orleans area in May 1955, at which time it

registered the name under the Louisiana Trademark

Law. The registration has been successively renewed

since that date.

Since 1955, The Vision Center has placed its name

before the public to the maximum extent allowed by

the ethics of the optometric profession. Thus, it has

used the name on eyeglass cases, lens wipers, lens

cleaning solution, announcements, telephone book

yellow pages, letterheads, direct mailing materials and

the like. After media advertising became permissible by

Louisiana optometrists in early 1978, The Vision

Center engaged in extensive promotion of its name.

Until Respondents entered the New Orleans

marketing area, no one other than The Vision Center

had used the combination of words “Vision Center”. In

at least three prior instances, The Vision Center was

successful in having competing firms change their

trade names so as not to use the words“ Vision Center”

in combination.

5

On trial of the instant case, The Vision Center estab-

lished that there was actual confusion of identity

between itself and some of Respondents’ Pearle Vision

Centers located in other areas, and that use by

Respondents of the name “Pearle Vision Center”

would confuse customers and potential customers in

the New Orleans area. Some of Respondents’ estab-

lishments in other locations used eyeglass cases and

signs which were imprinted with the words “Vision

Center”, without the identifying name “Pearle”. Also

Respondents’ national television commercials (which

were intended for use in the New Orleans area) and ad-

vertisements in magazines contained the words

“Vision Center” without the prefix “Pearle”.

Respondents unsuccessfully tried to purchase Peti-

tioner and thereafter opened their establishments in

New Orleans in close proximity to Petitioner’s exist-

ing establishments. Each of Respondents’ establish-

ments featured large exterior signs with the name

“Pearle Vision Center” prominently displayed, and

advertised themselves in the telephone book, directly

under petitioner’s listing, as “VISION CENTER

PEARLE-See Pearle Vision Center”.

REASONS FOR ALLOWING THE WRIT

1.

The decision below, both in failing to con-

sider the issue of likelihood of confusion and

6

in holding that the addition of a prefix to a

trade name absolves the user from findings of

deception and unfair competition, conflicts

with the guidelines set forth by this Court in

Hanover Star Milling Co. vs. Metcalf, 240 U.S. 403

(1916), as well as with decisions of the other

Circuits and the Fifth Circuit’s own earlier

holdings.

Certiorari should be granted to review the Appellate

Court’s holding that, despite the District Court's find-

ings of fact to the contrary, the evidence “falls short of

establishing that in the mind of the consuming public

the primary significance of the term ‘Vision Center’ is

‘not the product but the producer’.” 596 F.2d at 118.

The controlling issue in a trade name case is whether

the use of a similar name is likely to cause confusion.

Scarves by Vera, Inc., vs. Todd Imports, Ltd., (Inc.), 544 F.2d

1167 (CA 2-1976); Continental Motors Corp. vs. Continental

Aviation Corp., 375 F.2d 857 (CA 5-1967); Tisch Hotels, Inc.

vs. Americana Inn, Inc., 350 F.2d 609 (CA 7-1965); Safeway

Stores Inc. vs. Safeway Properties, Inc., 307 F.2d 495 (CA 2-

1962). The District Court found actual confusion be-

tween Petitioner’s trade name and Respondents’ trade

name, and also found that there would be likelihood of

confusion between the names. The Court of Appeals

failed to consider these crucial findings.

The addition of a prefix does not absolve the user

from findings of deception and unfair competition.

VI OORT

|

7

In Hanover Star Milling Co. vs. Metcalf, 240 U.S. 403

(1916), this Court was faced with whether the trade

name “Hanover Tea Rose” should be protected against

the competing name “Steeleville Tea Rose”, and held

that:

“... Themere substitution of ‘Steeleville’ in

the place of ‘Hanover’ on the labels is not con-

vincing either that the intent was innocent or

that the result will be innocuous, since it is ac-

companied with the words ‘Tea Rose’ .. .”

(240 U.S. at 424).

Similarly, in World Carpets, Inc. vs. Dick Littrell’s New

World Carpets, 438 F.2d 482 (CA 5-1971), the trade

name, “World Carpets” was protected against use of

the name “New World Carpets”, because there was a

likelihood of confusion between the two names. The

court in the World Carpets case also emphasized that the

prior user of the name had a right to be defended

against the marketing of a lower or different grade or

standard of product by the competitor and the result-

ing possible loss of reputation.

In Jenkins Publishing Co. vs. Metalworking Publishing Co.,

315 F.2d 955 (CCPA-1963), the court protected the

term “METALWORKING” as against “WESTERN

METALWORKING”, because the addition of the pre-

fix did not eliminate likelihood of confusion.

Respondents’ use of the word “Pearle” as a prefix

does not absolve it from the likelihood of confusion of

its name with that of The Vision Center.

8

2.

The decision below, in failing to protect a

local first user’s trade name and in holding

that secondary meaning cannot be establish-

ed through long usage, conflicts with this

Court's decision in American Trading Co. vs.

H. E. Heacock Co., 285 U.S. 247 (1932), and with

decisions of the other Circuits.

It is undisputed that The Vision Center was first to

employ its trade name in the New Orleans market and

therefore had the prior right to use that name in that

market. United Drug Co. vs. Theodore Rectanus Co., 248 U.S.

90 (1918); The Dynasty Room, Inc. d/b/a Whiskey A-Go-Go

vs. Whiskey A-Go-Go, Inc., 186 So.2d 402 (La. App. 4-

1966).

Moreover, the name“ The Vision Center”, is capable

of full trade name protection. In fact, Respondents

themselves secured from the United States Patent Of-

fice a federal trademark of the name “Vision Center”,

the very mark which they now challenge as invalid. A

federally registered trademark is prima facie evidence

that the mark is distinctive. Abercrombie & Fitch Co. vs.

Hunting World, Inc., 537 F.2d 4 (CA 2-1976); Union Car-

bide Corp. vs. Ever-Ready, Incorporated, 531 F.2d 366 (CA 7-

1976).

In American Trading Co. vs. H. E. Heacock Co., 285 U.S.

247 (1932) it was held that because of the first user’s

long use in the local market of the name “Rogers” on

9

silverware, the local first user had acquired valuable

goodwill, and the name identifying its wares had be-

come distinctive and was entitled to trade name pro-

tection.

The District Court held that over a long period of

time the name “Vision Center” had become at least

suggestive of Petitioner’s business establishments, and

also that through Petitioner’s efforts, the name“ Vision

Center” had acquired a secondary meaning in the

minds of the public. When this occurs, the name is en-

titled to trade name protection. Kellogg Co. vs. National

Biscuit Co., 305 U.S. 111 (1938). Such a holding is a fact-

ual holding and will not be disturbed unless clearly

erroneous. Volkswagenwerk, AG vs. Rickard, 492 F.2d 474

(CA 5-1974); FRCP Rule 52(a). Similarly, in Standard

International Corp. vs. American Sponge and Chamois Co., 394

F.2d 599 (CCPA-1968), the name “DUST ’N WAX” was

protected by precluding use of the competing name

“DUST ‘N GLOW”.

The Appellate Court erred in holding that sec-

ondary meaning could not be established by long usage.

Safeway Stores, Inc. vs. Safeway Properties, Inc., 307 F.2d 495

(CA 2-1962); G. & C. Merriam Co. vs. Saalfield, 198 Fed.

369 (CA 6-1912), aff’d and modified, 238 Fed. 1 (CA 6-

1917), cert. denied 243 U.S. 651 (1917); and American

Trading Co. vs. H. E. Heacock Co., supra.

3.

The holding of the Court below, that actual

fraud must be established before atrade name

10

may be protected, is contrary to all law

governing protection of trade names, and, un-

less reversed, will cause uncertainty and con-

fusion in the law governing trade name pro-

tection.

The Court of Appeals acknowledges that both The

Vision Center and Respondents “relied on federal

precedents as announcing generally accepted prin-

ciples of substantive trademark law”. 596 F.2d at 115.

The Court then discussed Louisiana authorities, which

it erroneously read as requiring that actual fraud must

be proven before use of acompeting trade name may be

enjoined. 596 F.2d at 117 (fn. 16), 118-9. The Court re-

lied on Straus Frank Co. vs. Brown, 246 La. 999, 169 So.2d

77 (1977), and mistakenly failed to consider the

Louisiana court’s statement in that case, that fraud can

be reasonably inferred.

The Court below failed to consider the authorities

that hold an infringer’s conduct can “amount to fraud”

and be “tantamount” to fraud, which meets a fraud

standard. T.G.I. Friday's Inc. vs. International Restaurant

Group, Inc., 569 F.2d 895 (CA5-1978), aff’g 405 F.S. 698

(M.D. La.-1975).

There is ample evidence to support the District

Court’s holdings that Respondents’ conduct amount-

ed to and was tantamount to fraud and from that con-

duct fraud can be reasonably inferred. Respondents

tried unsuccessfully to purchase The Vision Center,

|

11

advertised themselves in the telephone directory pages

as “VISION CENTER PEARLE-See Pearle Vision

Center”, located their stores in close proximity to those

of The Vision Center and utilized large signs featuring

the words “Vision Center” in combination.

The discussion of the Louisiana authorities in the

opinion of the Court below drives a wedge between the

law of trade names as enforced throughout the United

States from that as enforced in Louisiana, a wedge not

justified by the Louisiana authorities. As held in Handy

vs. Commander, 49 La. Ann. 1119, 22 So. 230 (1897),

Louisiana long ago adopted the Federal common law of

trade marks and trade names. It is submitted that a

close reading of the Louisiana cases clearly shows that

the court below has misread those cases.

CONCLUSION

If the opinion of the Court below is allowed to stand,

the result on the law of trade names will be devastat-

ing. Local prior users of trade names will have little or

no protection against giant competitors who enter

their market areas with confusingly similar names. The

opinion of the Court below is contrary to uniformly

controlling decisions on the questions presented.

For the reasons assigned, Petitioner respectfully sub-

mits that this petition for certiorari should be granted.

William W. Messersmith, III

Attorney for Petitioner

12

Bernard Marcus

Deutsch, Kerrigan & Stiles

Of Counsel

CERTIFICATE

It is certified that copies of the foregoing petition

were served on Respondents this date by mailing same

to their counsel of record as required by Rule 33-1 of

this Court.

New Orleans, October , 1979.

William W. Messersmith, III

APPENDIX

a

la

APPENDIX “A”

THE VISION CENTER,

Plaintiff-Appellee,

Cross Appellant,

versus

OPTICKS, INC., Will Ross, Inc., and

G. D. Searle & Co.,

Defendants-Appellants,

Cross Appellees.

No. 78-2867

United States Court of Appeals,

Fifth Circuit

May 23, 1979

Rehearing Denied Aug. 1, 1979

Appeals from the United States District Court for

the Eastern District of Louisiana.

Before THORNBERRY, AINSWORTH and

MORGAN, Circuit Judges.

LEWIS R. MORGAN, Circuit Judge:

This is an expedited appeal from an order of the dis-

trict court granting a preliminary injunction which pre-

2a

vents Opticks, Inc.,! a Texas corporation, from using

the trade name “Pearle Vision Center” in the New

Orleans market area. The Vision Center,? a Louisiana

partnership, claimed that Opticks’ proposed use of the

words “vision” and “center” constituted trade name in-

fringement and unfair competition. The action was

originally filed in state court and was removed to fed-

eral court on the basis of diversity jurisdiction. The dis-

trict court? found that the name “vision center” was

either suggestive of the partnership’s services or, if

descriptive, had acquired a secondary meaning. More-

over, the court concluded that Opticks’ conduct was

tantamount to fraud. Opticks insists that these find-

ings are clearly erroneous and argues that the district

court erred in granting a preliminary injunction afford-

ing trade name protection to the phrase“ vision center.”

We agree and therefore reverse the district court.

I.

The phrase “vision center” was first used inthe New

Orleans area in 1955 when Dr. Ellis Pailet, a New

1 Both Opticks, Inc. and Will Ross, Inc. are subsidiaries of G. D.

Searle & Co., a Delaware corporation with its principal place of

business in Skokie, Illinois. A “ye all three corporate entities

- appellants in this action, we will refer to them collectively as

“ ptic “ag

2 Because this appeal involves a construction of the words

“vision center,” we will, in an effort to forestall possible con-

fusion, avoid calling plaintiff “The Vision Center” but will refer to

it as the “partnership.”

3 The court’s decision granting plaintiff’s motion for a prelimi-

nary injunction is reported at 461 F.Supp. 835.

a

3a

Orleans optometrist, adopted it as the name of his sole

proprietorship. Subsequently, Dr. Pailet hired addi-

tional optometrists and in 1967 formed a partnership

which continued, without interruption, to use “The

Vision Center” name. That partnership is the plaintiff

in this action. The partnership has six locations in the

New Orleans area, all operating under the name “The

Vision Center.”

Dr. Pailet first registered the trade name with the

Secretary of State of Louisiana under the Louisiana

Trademark Law on April 19, 1955.4 That registration

was renewed in March 1965 and again in February

1975. Over the years, the partnership engaged in the

limited advertising permitted under the ethics of the

optometric profession and, with a change in the law in

1978, began media advertising in newspapers, mag-

azines, and on the radio.

In 1969, Opticks acquired a New York Company

which had dispensed optical goods and services since

1952 under the name “Vision Center.” Opticks then

began to operate similar stores using this name and, at

present, operates a national chain of retail outlets for

optical services and goods under the trade names

“Vision Center,” “Pearle Vision Center,” “Rogers

Vision Center,” and “Hillman-Kohan Vision Center.”

4 La.R.S.51:211etseq. At present, noone else in the New Orleans

market area uses the combination of words “vision” and “center.”

On three separate occasions the partnership persuaded other op-

tical firms planning to use these words to change their walle

names to some other name. No legal action was necessary on any

of these occasions.

4a

On July 28, 1970, Will Ross, Inc. registered the words

“vision center” as both a service mark and a trademark

on the principal register of the U.S. Patent Office. Will

Ross later assigned its rights in these marks to Op-

ticks.

During 1977 Opticks formulated a plan to open three

outlets in the New Orleans area under the name

“Pearle Vision Center.”5 Opticks planned to identify its

stores by a large green exterior sign showing the words

“Pearle Vision Center” in large white letters, with

“Pearle” being the largest word. In promoting its new

stores, Opticks also planned to use its national adver-

tising program and materials, including television and

radio commercials, newspaper advertisements, and

direct mail flyers. Although a percentage of Opticks’

consumer-oriented advertising materials used in other

parts of the country employs the words “Vision

Center,” without an identifying prefix, the adver-

tising slated for use in New Orleans always used the

words “Pearle Vision Center.”© The partnership

5 Opticks was aware of the existence of “The Vision Center”

and, at one point, initiated negotiations to purchase the partner-

ship. The partners considered Opticks’ offer but declined to sell.

6 The district court found that Opticks had used the words

“Vision Center” on certain of its e pa. cases and had exhibited

no intention to abandon such use. The record indicates, however,

that the partnership obtained the eyeglass case introduced as an

exhibit from Opticks’ Biloxi, Mississippi store, and the partner-

ship offered no proof that any materials without the identifying

prefix “Pearle” would be used in New Orleans. Absent evidence to

the contrary, the district court should have accepted Opticks’

assertion that all of its New Orleans advertising will employ the

words “Pearle Vision Center” and that it will not use the words

“Vision Center” without the identifying prefix.

EE PET

5a

brought suit, and on August 25, 1978, the district court

entered a preliminary injunction enjoining Opticks

from using any combination of the words “vision” and

aa +™&

center” in the New Orleans area.

Il.

The granting or denying of a preliminary injunction

rests in the sound discretion of the district court, and

its decision will be overturned only for abuse. Johnson v.

Radford, 449 F.2d 115 (Sth Cir. 1971). A preliminary in-

junction is an extraordinary remedy, however, and the

boundaries within which the district court must exer-

cise its discretion are clearly marked. State of Texas v. Sea-

train International, S.A., 518F.2d175 (Sth Cir. 1975); Canal

Authority v. Callaway, 489 F.2d 567 (Sth Cir. 1974). The

district court should issue the injunction only if the

moving party clearly satisfies what we have recog-

nized as the four prerequisites to such relief.? These

are: (1) a substantial likelihood that the movant will

ultimately prevail on the merits; (2) a showing that the

movant will suffer irreparable injury unless the in-

junction issues; (3) proof that the threatened injury to

7 The gegen: - contends that the standard for appellate

review of the granting of a preliminary injunction recognized in

our opinions is inapplicable in a trade name case. We disagree. In

Compact Van Equipment Co. v. Leggett & Platt, Inc., 566 F.2d 952 (Sth Cir.

1978), a patent infringement and unfair competition case, we

examined the district court’s granting of a preliminary injunction

in the light of these four Py ewe A trade name infringe-

ment case does not require a different standard. See, ¢.g., Scientific

Applications, Inc. v. Energy Conservation Corp., 436 F Subp. 354

(N.D.Ga. 1977).

6a

the movant outweighs whatever damage the proposed

injunction may cause the opposing party; and (4) a

showing that the injunction, if issued, would not be ad-

verse to the public interest. Seatrain, supra, 518 F.2d at

179, and cases cited therein. The remedy should not be

granted unless the movant carries the burden of per-

suasion concerning all four of these criteria.

Because removal to federal court was premised en-

tirely upon diversity of citizenship, we look to state

substantive law in assessing the merits of both the

trade name infringement and unfair competition

claims. The fact that Opticks’ Lanham Act registration

may be a defense to a state trade name infringement

claim affords no basis for original federal question

jurisdiction. Gully v. First Nat'l Bank, 299 U.S. 109, 57

S.Ct. 96, 81 L.Ed. 70 (1936); La Chemise Lacoste v. Alligator

Co., 506 F.2d 339 (3rd Cir. 1974). Although we apply

Louisiana law, we note that both parties have relied on

federal precedents as announcing generally accepted

principles of substantive trademark law. Except where

we discern a difference between local law and the gen-

eral law on the subject, we will also employ relevant

federal decisions. See Kellogg Co. v. National Biscuit Co., 305

U.S. 111, 113 n. 1, 59 S.Ct. 109, 83 L.Ed. 73 (1938).

III.

The threshold question in any trade name infringe-

ment action is whether the word or phrase was initial-

8 It is clear that Opticks’ federal registration is not a defense in

this case since, as the district court found, the partnership was a

prior user of the term” Vision Center” in the New Orleans market

area. See Burger King v. Hoots, 403 F.2d 904 (7th Cir. 1968).

ee em nt ety aa

7a

ly registerable or protectable.? American Heritage Life Ins.

Co. v. Heritage Life Ins. Co., 494 F.2d 3, 10 (Sth Cir. 1974).

To assist in making this determination, the courts have

traditionally divided the universe of potential trade

names into various categories of legal protectability. A

trade name is generally classified as being either (1)

generic, (2) descriptive, (3) suggestive, or (4) arbitrary

or fanciful.1° Miller Brewing Co. v. G. Heilman Brewing Co.,

561 F.2d 75, 79 (7th Cir. 1977), cert. denied, 434 U.S.

1025, 98 S.Ct. 751, 54 L.Ed.2d 772 (1978); Abercrombie &

Fitch Co. v. Hunting World, Inc., 537 F.2d 4, 9 (2d Cir.

1976); American Heritage, supra, 494 F.2d at 11. Although

these categories are meant to be mutually exclusive,

they are spectrum-like and tend to merge impercep-

tibly from one to another. For this reason, they are

9 Louisiana law defines a trade name to be”“a word, name, sym-

bol, device or any combination thereof used by a person to identi-

fy his business, vocation or occupation and distinguish it from the

business, vocation, or —— of others.” La.R.S. 51:211. The

mere registration of a trade name does not grant the registrant

any substantive rights but confers only procedural advantages.

Buyers & Traders Service, Inc. v. Car Maintenance Specialists, 290 So.2d

753 (La.App. 1974); Gallo v. Safeway Brake Shops, 140 So.2d 912

(La.App. 1962). Although the Secretary of State’s decision re-

garding the registerability or protectability of a particular mark is

persuasive, his determination is not conclusive or binding on this

court. Couhig’s Pestaway Co. v. Pestaway, Inc., 278 So.2d 519 (La.App.

1973). The Louisiana trademark statute specifically authorizes the

courts to order cancellation of a registered mark when they deem

that registration to have been improvidently granted. (ars.

§1:219.

10 Although no Louisiana case has employed this precise classi-

fication scheme, both the district court below and the parties here

utilized it in analyzing this case. For this reason, and because we do

not think the Louisiana courts would question the usefulness of

the categories or reject the parties’ reliance on them, we adopt the

classification scheme as an aid in measuring the legal protect-

ability of the “vision center” name.

8a

difficult to define and, quite frequently, difficult to

apply. Miller Brewing Co. v. G. Heilman Brewing Co., supra,

561 F.2d at 79.

A generic term is the name of a particular genus or

class of which an individual article or service is but a

member. Most courts hold that a generic term is in-

capable of achieving trade name protection. A descrip-

tive term!! identifies a characteristic or quality of an

article or service and, though ordinarily not protect-

able, may become a valid trade name if it acquires a

secondary meaning. A suggestive term suggests,

rather than describes, a characteristic of the goods or

services and requires an effort of the imagination by

the consumer in order to be understood as descriptive.

General Shoe Corp. v. Rosen, 111 F.2d 95, 98 (4th Cir. 1940).

A suggestive term requires no proof of secondary

meaning in order to receive trade name protection. An

arbitrary or fanciful term bears no relationship to the

11 Some courts see little difference between the generic and the

descriptive categories and tend to meld the two concepts into one.

American Heritage Life Ins. Co. v. Heritage Life Ins. Co., supra, 494 F.2d at

11; but see Aloe ees Laboratories, Inc. v. Milsan, 423 F.2d 845, 849 (Sth

Cir.), cert. denied, 398 U.S. 928, 90 S.Ct. 1818, 26 L.Ed.2d 90 (1970).

As one commentator has noted, the distinction between mong: a

tive and generic terms is necessarily one of degree. R. Callman, The

Law of Unfair Competition, supra, §70.4. The practical significance of

the distinction is seen in the courts’ refusal to allow proof of sec-

ondary meaning to elevate generic, as opposed to descriptive,

terms to trademark status. As noted below, however, under

Louisiana law a plaintiff depending on the secondary meaning of

his mark must prove fraud or unfair competition before the court

will enjoin the defendant's use. This unorthodox construction re-

sults in the practical elimination of the generic/descriptive dich-

otomy, since neither the owner of the generic mark nor the own-

er of the descriptive mark may rely solely on secondary meaning to

achieve trade name protection.

eee

9a

product or service and is also protectable without proof

of secondary meaning.

The partnership urges, and the district court found,

that “The Vision Center” name is suggestive and there-

fore entitled to full trade name protection without

proof of secondary meaning. We are convinced, how-

ever, that the trade name “Vision Center” is descrip-

tive!2 of a clinic providing optical goods and services,

and we hold that the partnership has failed to prove

secondary meaning as required under Louisiana law.

For these reasons, we reverse.

We begin with the proposition that “[t]he concept of

descriptiveness must be construed rather broadly” 3R.

Callman, The Law of Unfair Competition, Trademarks and

Monopolies, §70.2 (3d ed. 1969). Whenever a word or

phrase naturally directs attention to the qualities, char-

acteristics, effect, or purpose of the product or service,

it is descriptive and cannot be claimed as an exclusive

trade name. Id. at §71.1. Webster’s Third New Inter-

12 Weare unable to agree with Opticks that the phrase “vision

center” is a generic term. Although the phrase is deacrigtive of a

business that deals in optical goods, we do not think that it has be-

come a common, recognized name of such establishments. In con-

nection with this litigation, Opticks has offered to have its federal

registrations cancelled if we will find that these words are gener-

ic. While this court is neither disposed nor authorized to bargain

with legal ri hts, we note that in reality Opticks has provided us

with no quid pro quoin this case. Under slanhans Act, if a regis-

tered mark becomes the “common descriptive name” of an item

(i.e., becomes generic) it may be cancelled at any time. 15 U.S.C.

§1064. Therefore, if we were to find that the phrase is generic we

would not need Opticks’ permission to cancel its mark.

10a

national Dictionary (1964)!3 defines the word “vision”

as

the act or power of seeing; visual sensation or

the capacity for it.

The word “center” means

a concentration of requisite facilities for an ac-

tivity, pursuit, or interest along with various

adjunct conveniences [e.g. shopping center,

medical center, amusement center].

Used in combination, the words imply a place where

there is aconcentration of requisite facilities relating to

the power of seeing or the capacity for it. Because the

name does not require “imagination, thought and per-

ception to reach a conclusion as to the nature of the

goods” or services, it cannot be considered a sugges-

tive term. Stix Products, Inc. v. United Merchants & Mfrs.,

Inc., 295 F.Supp. 479, 488 (S.D.N.Y. 1968).

Another test used by the courts to distinguish be-

tween descriptive and suggestive marks is “whether

competitors would be likely to need the terms used in

the trademark in describing their products.” Union Car-

bide Corp. v. Ever-Ready, Inc., 531 F.2d 366, 379 (7th Cir.

13 “The dictionary definition of the word is an appropriate and

relevant indication ‘of the ordinary 5 and meaning o

words’ to the public.” American Heritage Life Ins. Co. v. Heritage Life Ins.

Co., supra, 494 F.2d at 11.

lla

1976). We agree with Opticks that the word “vision” is

virtually indispensable to the vocabulary of the optical

goods industry.!4 This word, along with such common

nouns as eye, sight, and optics, naturally occurs to one

in thinking of the goods and services provided by the

parties. Similarly, the word “center” is acommon term

found useful by a variety of commercial enterprises.

We are, of course, aware that common, ordinary

words can be combined in a novel or unique way and

thereby achieve a degree of protection denied to the

words when used separately. Although examining a

trade name’s individual words in isolation entails the

risk that the distinctiveness of the words in combina-

tion will be overlooked, we are not guilty of such an

oversight here. Rather, whether the words “vision”

and “center” are examined together or separately, we

are convinced that they lack the quality of inventive-

ness and imaginativeness characteristic of suggestive

trade names.

Yet another barometer of the descriptiveness vel non

of a particular name is the extent to which it has been

used in the trade names of others offering a similar

service or product. Shoe Corp. of America v. Juvenile Shoe

Corp., 266 F.2d 793, 796 (C.C.P.A. 1959). As the record

reveals, the name “vision center” has been adopted by a

large number of optical stores in other parts of the

14 We note that the word has been utilized in the trade name of

another optical store in New Orleans, the Vision Plaza.

12a

nation.!5 That the partnership is the only one to use the

term in New Orleans does not preclude us from find-

ing that its name is descriptive.

A number of federal and state cases construing simi-

lar trade names are consistent with our decision. In Car

Care, Inc. v. D. H. Holmes Co., 160 So.2d 272 (La.App.

1964), a Louisiana case, plaintiff sought to enjoin the

defendant’s use of the name “D. H. Holmes Car Care

Center” as an infringement of its name, “Car Care

Center.” The court concluded that the words “car care”

were descriptive of the automobile maintenance busi-

ness and therefore incapable of exclusive appropria-

tion. In Surgicenters of America, Inc. v. Medical Dental Sur-

geries Co., 196 U.S.P.Q. 121 (D.Or. 1976), plaintiff

claimed that the defendant’s use of the name “Medical

Dental Surgicenter” infringed its federally registered

mark, “Surgicenter.” The court disagreed and held that

“Surgicenter” was a generic term which should not be

given trade name protection. See also In re Executone Inc.,

191 U.S.P.Q. 57 (C.C.P.A. 1976) (“Nerve Center”);

Johnson & Johnson v. Saxton Adhesive Products, Inc., 185

U.S.P.Q. 245 (C.C.P.A. 1974) (“Tape Center”); Allens

Drug Co. v. Henry B. Gilpen Co., 180 U.S.P.Q. 327

(C.C.P.A. 1973) (“Drug Center”); Houston v. Berde, 211

Minn. 528, 2 N.W.2d 9 (1942) (“Food Center”).

15 E.xg., Royal Vision Center, Chicago Vision Center, Vision

Center and Optical Clinic of Baton Rouge, Vision Center Op-

ticians, Professional Vision Center, Vision Center of South

Boston, Vision Center at Harvard Square, Plymouth Vision

Center, Konrad Vision Center, Total Vision Center, Belmont

Vision Center, Livonia-Mall Vision Center, V.I.P. Vision Center,

American Vision Center, United Vision Center, 20/20 Vision

Center, Plain Vision Center and Harvey Rubin Vision Center.

ee ee Se rT ee Te a Te tye ee ee aan See eT ee Ma eR ee ee ae

13a

The partnership questions the applicability of these

cases and attempts to distinguish them on the ground

that, unlike here, their identifying words describe the

goods or services provided by their respective estab-

lishments. In order to more precisely identify the serv-

ice provided by an optical store, the partnership’s name

should read “Vision Care Center.”1¢ While this may be

regarded as the full name of such an establishment, to

pretend that the abbreviated name “Vision Center”

cannot substitute in its stead ignores our “universal

habit of shortening full names — from haste or lazi-

ness or just economy of words.” Application of Abcor

Development Corp., 588 F.2d 811 (C.C.P.A. 1978) (Rich, J.,

concurring). It simply does not require an effort of the

imagination to decide that a “vision center” is a place

where one can get glasses. Consequently, we find

either name to be descriptive of the service provided by

a business that deals in optical goods.17

16 The descriptive nature of this term is, of course, beyond per-

adventure.

17 As evidence that its chosen trade name is distinctive and not

generic or descriptive, the partnership points out that a patient in

need of eyecare is unlikely to say or think, “I am going to my vision

center.” T his reasoning is unacceptable. Few consumers would call

a grocery store a “food center” or a pharmacy a “drug center,” yet

these names have been held descriptive af the establishment’s

identity. Thus, the fact that “vision center” is not the only or most

common name for an optical goods store is not determinative, for

“there is no legal foundation that a product has only one common

descriptive name.” Roselux Chemical Co. v. Parsons Ammonia Co., 299

F.2d 855 (C.C.P.A. 1962). Also, “the absence of a word or expres-

sion from dictionaries is not controlling on the question of regis-

terability.” In re Cooper, 196 U.S.P.Q. 182 (1977).

14a

IV.

The case law uniformly requires that we refuse trade

name protection to a descriptive term unless it has ac-

quired a secondary meaning.!* In order to establish

secondary meaning the plaintiff “must show that the

primary significance of the term in the minds of the

consuming public is not the product but the producer.”

Kellogg Co. v. National Biscuit Co., 305 U.S. 111, 118, 59

S.Ct. 109, 113, 83 L.Ed. 73 (1938). The burden of proof

rests at all times with the plaintiff, and“[a] high degree

of proof is necessary to establish secondary meaning

for a descriptive term.” R. Callman, The Law of Unfair

Competition, supra, §77.3 at 359; American Heritage, supra,

494 F.2d at 12.

Most courts hold that once the plaintiff establishes

secondary meaning he need only show a likelihood of

confusion in order to enjoin an infringing use. E.g., Aloe

Creme Laboratories, Inc. v. Milsan, Inc., 423 F.2d 845 (5th

Cir. 1970); R. Callman, The Law of Unfair Competition,

supra, §77.1. The Louisiana courts, however, continue

to hold that the plaintiff who depends on secondary

meaning for his trade name cannot obtain injunctive

relief unless he proves fraud or unfair competition on

the part of the defendant. Home Beverage Service v. Baas,

210 La. 873, 28 So.2d 481, 484 (1946); Straus Frank Co. v.

Brown, 246 La. 999, 169 So.2d 77 (1964); Couhig’s Pest-

18 “The terms, primary and secondary, may be somewhat mis-

leading since a secondary meaning entitled to protection must

have become the primary meaning to the consumer.” Aloe Creme

Laboratories, Inc. v. aes Inc., supra, 423 F.2d at 848 n. 9.

15a

away Co. v. Pestaway, Inc., 278 So.2d 519 (La.App. 1973).

Under this rule, the law of unfair competition effec-

tively swallows up the secondary meaning doctrine. Al-

though Callman expressly disapproves of the Louisiana

case law and considers it erroneous, we are not at

liberty to do so.19

The partnership, however, relies on the district

court’s finding that Opticks’ conduct amounted to or

was at least tantamount to fraud. The Louisiana courts

have “always been reluctant to presume fraud.” Straus

Frank Co. v. Brown, supra, 169 So.2d at 80. In the Straus

Frank case the plaintiff, operating under the trade name

“Lake Auto Parts,” sued to enjoin the defendant from

using the name “Lake Auto Supply.” The court ob-

served:

One other charge leveled at defendant is

that he knew of plaintiff's trade name and by

adopting a similar one it may be inferred his

motive was fraudulent. But we are not con-

vinced of this. To the contrary, aside from the

words “Auto Supply” which describes his

business, we feel defendant was motivated by

the geographical location in the selection of

the name Lake Auto Supply, situated as the

business is in the town of Lake Arthur which

lies on the shores of Lake Arthur.

19 R. Callman, The Law of Unfair Competition, supra, §77.1. The

Louisiana courts are not unaware of the controversy surround-

ing the requirement that the plaintiff who relies on secondary

meani rove fraud. See St k Co. v.

ay Sooty raus Frank Co. v. Brown, 246 La. 999, 109

16a

169 So.2d at 81. Having used the “vision center” trade

name for many years in connection with its network of

similar stores and its national advertising campaign,

Opticks has a significant investment in the name. It

was predictable that Opticks would choose to use the

name “Pearle Vision Center” in New Orleans. The

emphasis placed on the word “Pearle”2° further ab-

solves Opticks from any charge of deception or unfair

competition, and under Louisiana law the addition of

this identifying prefix is legally sufficient to dis-

tinguish Opticks’ business from the partnership’s.?1

Home Beverage Service v. Baas, supra; Couhig’s Pestaway Co. v.

Pestaway, Inc., 278 So.2d 519 (La.App. 1973). We are con-

vinced that the district court’s finding of fraud was in-

correct.

As the above discussion indicates, even if we were to

concede that the partnership’s name had acquired a

secondary meaning we could not prevent the fair use of

the descriptive term “vision center.” Home Beverage Serv-

20 Although we hold that Opticks is free to use the words

“vision center” in New Orleans, the corporation is obligated “to

identify its product lest it be mistaken for that of the plaintiff”. Kel-

logg Co. v. National Biscuit Co., 305 U.S. at 120, 59 S.Ct. at 114. Op-

ticks, therefore, must honor its pledge to place the identifying pre-

fix “Pearle” in front of the phrase “Vision Center” on all its signs

and advertisements in the New Orleans area.

21 The prefix is not only legally sufficient but is legally necessary

in order to distinguish Opticks’ business and prevent unfair

competition. For this reason, Opticks should desist from listing its

establishment in the telephone directory under the heading

“Vision Center Pearle—See Pearle Vision Center.” See Home Bever-

age Service v. Baas, supra, 28 So.2d at 486, where the court, in finding

no likelihood of confusion between plaintiff's Home Beverage

Service name and defendant’s Victory Home Beverage Service

name, noted that the defendant listed its name only under the

letter “V” in the telephone directory and not under the letter “H.”

17a

ice v. Baas, supra. We are convinced, however, that the

partnership failed to shoulder the substantial eviden-

tiary burden necessary to establish the secondary

meaning of this descriptive name.

In assessing a claim of secondary meaning,

the chief inquiry is the attitude of the con-

sumer toward the mark; does it denote to him

a, “single thing coming from a single source”?

Short of a survey, this is difficult of direct

proof.

Aloe Creme Laboratories, Inc. v. Milsan, Inc., supra, 423 F.2d at

849. The partnership presented no evidence involving

an objective survey of the public’s perception of its

name. Instead, the only evidence offered to show

secondary meaning was the testimony of seven of the

partnership’s customers that “Vision Center” meant

the partnership’s business to them, testimony that the

partnership had occasionally received mail addressed to

other establishments that had “vision” in their name,

and evidence that a customer of one of Opticks’ stores

in another city believed the partnership and Opticks

were associated.

We think this evidence falls short of establishing that

in the minds of the consuming public the primary sig-

nificance of the term“ vision center” is “not the product

but the producer.” Additionally, the recognition of the

partnership’s long use of the term does not require a

different result since the “courts have summarily re-

18a

jected claims of secondary meaning predicated solely

upon the continued use of the mark for many years.”22

R. Callman, The Law of Unfair Competition, supra, §77.3.

V.

We now address, perhaps somewhat belatedly, the

partnership’s assertion that Opticks’ federal registra-

tion of the words “vision center” is prima facie evi-

dence that the name is distinctive and not generic or

descriptive. The partnership finds itself in the unusual

posture of asserting the validity of Opticks’ federal

registration, while Opticks, instead of seeking to de-

fend its mark, challenges its initial registerability or

protectability. Assuming arguendo that the prima facie

evidence provision of the Lanham Act was designed to

benefit the partnership in this case, we nevertheless

adhere to our conclusion that the “vision center” name

is merely descriptive.

Although a statutory presumption of validity is ac-

corded to marks registered under the Lanham Act, 15

U.S.C. §§1057(b), 1115(a), this presumption is re-

buttable and may be overcome by establishing the

generic or descriptive nature of the mark. Flexitized, Inc.

v. National Flexitized Corp., 335 F.2d 774, 779 (2d Cir.

1964), cert. denied, 380 U.S. 913, 85S.Ct. 899, 13L.Ed.2d

22 The partnership has used the “Vision Center” name in New

Orleans for over 20 years. During most of this period, however, it

was precluded by the ethics of the profession from engaging in

media advertising. Although extensive advertising would not

have assured the partnership’s success, this circumstance no

doubt significantly affected its efforts to develop a secondary

meaning for its name.

aN ale A 0 tS

OS LEPTIN IOS tl SNR RN

Rt Na ee a oo »

19a

799 (1965). The partnership maintains that Opticks

failed to show that the name is descriptive. We dis-

agree. Our previous discussion indicates that in this

case Opticks has argued persuasively, not merely with

equal force, that the partnership’s name is a term

descriptive of the products and services provided by an

optical store. Aluminum Fabricating Co. v. Season-All Win-

dow Corp., 259 F.2d 314, 316 (2d Cir. 1958); Scientific

Applications, Inc. v. Energy Conservation Corp., 436 F.Supp.

354, 360 (N.D.Ga. 1977). The weight of these argu-

ments is more than sufficient to rebut the prima facie

presumption that the name is suggestive rather than

merely descriptive.

VI.

Because the partnership has not shown a substan-

tial likelihood that it would ultimately prevail on the

merits, it is not entitled to the extraordinary relief of a

preliminary injunction. We find it unnecessary to en-

gage ina discussion of the other three criteria, except to

note that the partnership has also not shown that the

injury it will suffer by denying the injunction out-

weighs the damage that Opticks will suffer if the in-

junction is granted.

We reverse the district court and remand with in-

structions that the court dissolve the preliminary in-

junction and issue an order requiring Opticks to place

the identifying prefix “Pearle” before the phrase

“Vision Center” on all its signs and advertisements in

the New Orleans area.

REVERSED AND REMANDED.

20a

APPENDIX “B”

UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

OCTOBER TERM, 19

No. 78-2867

D.C. Docket No. CA 78-2458 “E”

THE VISION CENTER,

Plaintiff-Appellee,

Cross-Appellant,

versus

OPTICKS, INC., WILL ROSS, INC.

and G. D. SEARLE & CO.,

Defendants-Appellants,

Cross-Appellees.

Appeal from the United States District Court for the

Eastern District of Louisiana

Before THORNBERRY, AINSWORTH and

MORGAN, Circuit Judges.

lh A MPR Cale eat

21a

JUDGMENT

This cause came on to be heard on the transcript of

the record from the United States District Court for

the Eastern District of Louisiana, and was argued by

counsel;

ON CONSIDERATION WHEREOF, It is now here

ordered and adjudged by this Court that the order of

the District Court appealed from, in this cause be, and

the same is hereby, reversed; and that this cause be, and

the same is hereby remanded to the said District Court

in accordance with the opinion of this Court;

It is further ordered that the plaintiff-appellee pay to

the defendants-appellants the costs on appeal, to be

taxed by the Clerk of this Court.

May 23, 1979

ISSUED AS MANDATE: AUG. 9, 1979

APPENDIX “C”

UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 78-2867

|

22a

THE VISION CENTER,

Plaintiff-Appellee,

Cross-Appellant,

versus

OPTICKS, INC., WILL ROSS, INC.,

and G. D. SEARLE & CO.,

Defendants-Appellants,

Cross-Appellees.

Appeals from the United States District Court for the

Eastern District of Louisiana

ON PETITION FOR REHEARING

(August 1, 1979)

Before THORNBERRY, AINSWORTH and

MORGAN, Circuit Judges.

PER CURIAM:

IT IS ORDERED that the petition for rehearing filed

in the above entitled and numbered cause be and the

same is hereby Denied.

23a

ENTERED FOR THE COURT:

ls) ROBERT AINSWORTH, JR.

United States Circuit Judge

APPENDIX “D”

THE VISION CENTER,

Plaintiff,

versus

OPTICKS, INC., WILL ROSS, INC.,

and G. D. SEARLE & CO.,

Defendants.

Civ. A. No. 78-2458

United States District Court

E.D. of Louisiana

Aug. 25, 1978

MOTION FOR PRELIMINARY

INJUNCTION

CASSIBRY, District Judge:

24a

INTRODUCTION

This is an action for injunctive relief by The Vision

Center, a Louisiana partnership, against Opticks, Inc.,

a Texas corporation with its principal place of business

in Dallas, Texas; Will Ross, Inc., a Delaware corpora-

tion with its principal place of business in Milwaukee,

Wisconsin and G. D. Searle & Co., aDelaware corpora-

tion with its principal place of business in Skokie, Illi-

nois. Plaintiff seeks to enjoin defendants from using

the words “Vision Center” in the name of three places

of business about to be opened in the Greater New

Orleans area under the name “Pearle Vision Center.”

The action was originally filed in state court and was

removed by the defendants to federal court on the basis

of diversity of citizenship of the parties and the re-

quired jurisdictional amount involved. The court has

jurisdiction by virtue of citizenship of the parties. 28

U.S.C. §1332.

Plaintiff’s demand for a preliminary injunction was

tried by this court on August 10 and 11, 1978.

Having heard the evidence presented at trial, having

reviewed the documents, photographs and other items

introduced as exhibits, and having considered the argu-

ments of counsel, I make the following findings of fact

and conclusions of law:

I << Y

25a

FINDINGS OF FACT

1. Plaintiff, The Vision Center, is a Louisiana part-

nership organized pursuant to Articles of Partnership,

dated September 15, 1967, effective as of October 1,

1967.

2. The trade name, “The Vision Center,” has been

in continuous and uninterrupted use in the Greater

New Orleans area since May, 1955 — a period of over

twenty-three years — by plaintiff and its predecessor.

3. The first use of the trade name, “The Vision

Center,” in the New Orleans area was by Dr. Ellis

Pailet, plaintiff's managing partner, who commenced

using that name in May, 1955, as a sole proprietor en-

gaged in the practice of optometry. Subsequently, Dr.

Pailet hired other optometrists to work for The Vision

Center, and, in September, 1967, he granted partner-

ship status to some of the salaried optometrists. Pur-

suant to the Articles of Partnership, the partnership

carried on the name, “The Vision Center.” The part-

nership thereafter and without interruption con-

tinued, and still continues, the practice of optometry

under that name.

4. The trade name, “The Vision Center,” was first

registered by Dr. Ellis Pailet with the Secretary of State

of Louisiana under the Louisiana Trademark Law (R:S.

51:211 et seq.) on April 19, 1955. The registration was

renewed on March 29, 1965, and again on February 14,

26a

1975. The cost of the last renewal was borne by the

plaintiff partnership.

5. The Vision Center, since its inception as a sole

proprietorship in 1955, and from 1967 as a partner-

ship, until the current time, placed its name before the

public to the maximum extent allowed by the ethics of

the optometric profession by use of eyeglass cases, lens

wipers, lens cleaning solution, announcements of

office openings, telephone book yellow pages, recall

notices, letterheads, birthday cards, business cards,

appointment notices, statements, other direct mail-

ings and signs on and in front of offices. Over the years,

The Vision Center has spent considerable sums on

such items, and in the year 1977 alone spent over $30,-

000 for that purpose.

6. In 1978, since media advertising became per-

missible by optometrists, The Vision Center has adver-

tised on radio and in newspapers and magazines. The

Vision Center has, so far during the year 1978, spent

about $15,000 for such “media advertising.”

7. Plaintiff's volume of business has grown over

the years and it has succeeded in expanding from one to

six offices, with offices now located at 3901 Veterans

Boulevard, Metairie, Jefferson Parish, Louisiana; 4301

Elysian Fields Avenue in the Gentilly section or neigh-

borhood of New Orleans; 9235 Lake Forest Boulevard

in the Eastern section of New Orleans; 2901 General

De Gaulle Drive, in the Algiers section of New Orleans;

pee SEES NEN SAE ST 4 aie anata

REO 8 SAB fee wh

27a

Uptown Square, in the uptown section of New Orleans

and Hammond Square, Hammond, Tangipahoa Parish,

Louisiana.

8. Plaintiff is planning to expand its offices to:

Slidell, St. Tammany Parish, Louisiana; Laplace, St.

John the Baptist Parish, Louisiana; and to the Central

Business District in New Orleans.

9. Plaintiff’s market area includes the Louisiana

Parishes of Orleans, Jefferson, St. Bernard, Plaque-

mines, St. Tammany, Tangipahoa, St. Charles and St.

John the Baptist.

10. Plaintiff is engaged in the practice of full scope

optometry which includes complete visual analysis (in-

cluding external and internal diagnosis of eye disease,

and refractions) and includes dispensing of eyeglasses,

contact lenses, eyeglass frames and other visual aids,

and all things which optometrists are permitted by law

to do.

11. The nature of plaintiff’s profession is such that

many patients seek out plaintiff as a result of patient

and professional referrals. These referrals are normal-

ly made to “The Vision Center” or “Vision Center,”

rather than to a particular optometrist. However,

when referrals are made to a particular optometrist,

generally, the connection is made to identify that prac-

titioner as a part of plaintiff’s office (e.g., “See Dr.

28a

at ‘The Vision Center,’ or at ‘Vision

Center’ ”).

12. Plaintiff has over the years obtained and

presently obtains patients from its listings in the tele-

phone book yellow pages and from signs on and in front

of its offices.

13. During 1978, plaintiff's media advertising of its

name has attracted business.

14. Plaintiff’s name, “The Vision Center,” is well

established and is, and has been, well known to the

public in its market area for over twenty-three years.

15. No one else in plaintiff's market area uses the

combination of the words “Vision” and “Center.”

16. There have been instances of confusion be-

tween plaintiff’s name and the name of others in sim-

ilar businesses using only the word “Vision” as part of

the trade name, including mail being delivered to the

wrong place; e.g., such confusion with “Vision Plaza.”

17. There has been confusion between plaintiff's

business and certain of defendants’ Pearle Vision

Centers; e.g., there was actual confusion in the mind of

a witness who confused defendants’ Biloxi, Mississippi

facility as being a “Vision Center” connected with

plaintiff, and there was confusion by someone who

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29a

tried to have plaintiff, The Vision Center, honor an

eyeglass guarantee of defendants’ Pearle Vision

Center.

18. Plaintiff’s partners first heard rumors that

defendants may be opening facilities in the New

Orleans area in August, 1977 and, through its attor-

ney, wrote to defendants asking if this were the case. In

March, 1978, defendants responded to that inquiry and

informed plaintiff that they did intend to open such

facilities.

19. By letter dated May 25, 1978, plaintiff, through

its attorney, made formal demand on defendants not to

use both the words “Vision” and “Center” in its trade

name in plaintiff's market area, and by letter of June 21,

1978, plaintiff's attorney made a follow-up demand on

defendants therefor.

20. Defendant G. D. Searle & Company is the

parent corporation of defendants Will Ross, Inc., and

Opticks, Inc. Opticks is considered Searle’s “Optical

Group” and is doing business unde: the names Vision

Center, Pearle Vision Center, and other Vision

Centers.

21. In 1969 Opticks, Inc., acquired a New York City

company which had done business since 1952 under

the name “Vision Center.” This company continued to

30a

dispense optical equipment and services after its ac-

quisition by Opticks, Inc.

22. Shortly after the acquisition, Opticks, Inc.,

began operating similar stores in other areas of the

country using the words “vision center” as a trade

name or in combination with a prefix.

23. In 1969 Opticks, Inc., was merged into Will

Ross, Inc.

24. On July 28, 1970 Will Ross, Inc., registered the

words “Vision Center” as a service mark in the princi-

pal register of the United States Patent & Trademark

Office (No. 895,663). On November 17, 1975 affi-

davits pursuant to Section 8 and Section 15 of the Lan-

ham Act were filed and accepted with respect to the

service mark.

25. On July 13, 1971 Will Ross, Inc., registered the

words “Vision Center” as a trademark on the principal

register of the U.S. Patent Office (No. 916,280). On

November 23, 1976 a Section 15 Affidavit was filed

with the U.S. Patent Office with respect to the trade-

mark. On October 5, 1976 a Section 8 Affidavit was ac-

cepted by the U.S. Patent Office with respect to the

trademark.

26. Opticks, Inc., was recently spun off as a sep-

arate corporate entity, and Service mark No. 895663

imal td

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3la

and Trademark No. 916,280 were assigned by Will

Ross, Inc., to Opticks, Inc., as recorded in the U.S. Pat-

ent Office on October 1, 1977.

27. Defendant Opticks, Inc., owns and operates

over 300 retail outlets for optical goods and services

throughout the United States under the trade names

“PEARLE Vision Center,” “ROGERS Vision Center,”

and “HILLMAN-KOHAN Vision Center.”

28. Defendants use, anywhere, of the words —

“Vision Center” as part of a trade name was subse-

quent to plaintiff's use of the words “The Vision

Center” as a trade name — plaintiff and its prede-

cessors having used it since May, 1955.

29. Defendants have not heretofore used the

words “Vision Center” as part of a trade name in the

plaintiff’s market area.

30. Defendants are in the business of selling op-

tical goods such as eyeglass frames and lenses, and

employ opticians to fit and sell such eye-wear goods.

31. Defendants use eyeglass cases with only the

words “Vision Center” within an oval imprinted on

them. Plaintiff, since its inception and since the incep-

tion of its predecessor, has used, and now uses, eye-

glass cases containing the words “The Vision Center.”

Defendants have not shown any intention to change

their use of such eyeglass cases.

32a

32. Defendants conduct national advertising using

only the words “Vision Center” in magazine adver-

tisements, in television commercials (e.g., now in At-

lanta, Georgia, the television commercial uses just

“Vision Center” more than once in the middle of it, and

“Pearle Vision Center” at the end), on store signs, and

in some of defendants’ eyeglass warranty (guarantee)

certificates.

33. Opticks, Inc., plans to open three outlets in the

New Orleans area under the trade name “Pearle Vision

Center” in the near future.

34. Defendants are locating their facilities as

follows:

(a) One at 3544 Veterans Boulevard, Met-

airie, Louisiana, just six-tenths (0.6) of a mile

from plaintiff's office located on the same

street at 3901 Veterans Boulevard, Metairie,

Louisiana;

(b) One at 4801 Chef Menteur Highway in

the Gentilly section of New Orleans, just one

and six-tenths (1.6) miles from plaintiff’s Gen-

tilly office located at 4301 Elysian Fields

Avenue, New Orleans;

(c) One at 1523 Tulane Avenue, New

Orleans, just three and eight-tenths (3.8)

miles from plaintiff’s Elysian Fields office.

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33a

35. The opening of the “Pearle Vision Center”

stores will be extensively advertised on local tele-

vision, radio, in newspapers, and in direct mail flyers.

36. Each Pearle Vision Center location will have a

large exterior sign showing the company name in large

white letters on a green background. One sign, for

example, will be 28 ft. wide by 8% ft. high. The word

“Pearle” will be in white letters 33 inches high and

directly below it will be the words “Vision Center” in 19

inch white letters.

37. Defendants have known of plaintiff’s exis-

tence in New Orleans for many years.

38. Defendants, through one of the defendants’

real estate departments, conducted a market survey of

the New Orleans area prior to entering the market.

39. Prior to entering the market and expending

funds in connection therewith, defendants knew of the

locations of plaintiff’s offices and knew that plaintiff in-

tended to assert its rights to protect its name.

40. The combination of the words, or the phrase,

“The Vision Center,” i.e., plaintiff's trade name, is not

generic or descriptive.

41. Plaintiff’s trade name is suggestive of the busi-

ness it is engaged in. It has come to be well known in

34a

plaintiff’s market area by reason of its long usage of the

name in the market, the valuable goodwill of the name

and the identification of the name with plaintiff's busi-

ness.

42. Even if plaintiff's trade name were descriptive,

the evidence is clear that the trade name has acquired a

secondary meaning, because after long use (twenty-

three years) in the market area, the public has come to

identify and associate the trade name with the plaintiff,

and not with the services plaintiff renders. The words

“The Vision Center” have come to mean in the minds of

the public, the identity of plaintiff.

43. Actual confusion has been shown to exist

between plaintiff's offices and some of defendants’

facilities which are outside plaintiff's market area.

44. Actual confusion has been shown to exist

between plaintiff's offices and other similar local

offices using just the word “Vision” in the name.

45. There was uncontradicted testimony by in-

dependent witnesses that they would confuse defend-

ants’ new establishments to be called “Pearle Vision

Center” and plaintiff's offices.

46. Persons who would go to The Vision Center by

referrals or by reason of advertisements would be con-

femmes Pit late tenet

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35a

fused because of the similarity in names between plain-

tiff’s, The Vision Center, and defendants’, Pearle

Vision Center, particularly since the locations estab-

lished by defendants are in such close proximity to

plaintiff’s existing offices.

47. The use of the word combination of “Vision

Center” by defendants in connection with their optical

stores in the Greater New Orleans area is likely to

cause confusion to the public and cause plaintiff to lose

business.

48. Sometime ago, defendants initiated negotia-

tions with plaintiffs partners to purchase The Vision

Center.

49. The facts hereinabove set forth clearly estab-

lish that defendants are attempting to compete unfair-

ly with plaintiff and to infringe upon plaintiff’s long-

established trade name and goodwill, some of which

are: (i) defendants knew of plaintiff’s long use of its

trade name in the market; (ii) defendants attempted to

purchase plaintiff’s business; (iii) defendants obvious-

ly had knowledge of the value of plaintiff's long-estab-

lished name and goodwill; (iv) defendants have and/or

are locating their new facilities in plaintiff's market

area (even on the same street and in the same neigh-

borhood); and (v) the public already has been confused

by defendants’ out-of-the-market locations doing busi-

ness as Pearle Vision Center.

36a

50. The defendants have not successfully shown

that the harm of an injunction to them outweighs the

threatened injury to plaintiff.

CONCLUSIONS OF LAW

1. Plaintiff, as first user of the trade name “The

Vision Center” in its market area, has established a

priority of appropriation in that market area. Handy v.

Commander, 49 La.Ann. 1119, 22 So. 230 (1897); Dynasty

Room, Inc. (d/b/a Whiskey-A-Go-Go) v. Whiskey-A-Go-Go,

Inc., 186 So.2d 402 (La.App. 4th-1966); and Gallov. Safe-

way Brake Shops of Louisiana, Inc., 140 So.2d 912 (La.App.

4th-1962).

2. By virtue of plaintiff’s prior appropriation of the

trade name and because a federal trademark and use of

such trade name or mark in other locations cannot dis-

place a locally acquired trade name, plaintiff has a pro-

prietary interest in and a superior right to the trade

name in its market area. Dynasty Room, Inc.(d/b/a Whis-

key-A-Go-Go) v. Whiskey-A-Go-Go, Inc., 186 So.2d 402

(La.App. 4th-1966); American Trading Co. v. H. E. Heacock

Co., 285 U.S. 247, 52 S.Ct. 387, 76 L.Ed. 740 (1932); and

United Drug Co. v. Theodore Rectanus Co., 248 U.S. 90, 39

S.Ct. 48, 63 L.Ed. 141 (1919).

3. State law being applicable to this action, the

plaintiff is entitled to injunctive relief upon a prima facie

showing that irreparable injury would result absent

37a

the injunction order. Albrecht v. Del Bondio, 188 La. 502,

177 So. 587 (1937); see also Creppel v. Parish of Jefferson, 352

So.2d 297 (La.App. 4th-1977), writ denied, La., 354

So.2d 201. However, even if federal trade name law is

applied it is clear that plaintiff is entitled to issuance of a

preliminary injunction thereunder upon a showing

that confusion is possible and likely. P. Daussa Corp. 0.

Sutton Cosmetics, Inc., 462 F.2d 134 (CA 2-1972).

4. The fact that the United States Patent Office

accepted the trade name “Vision Center” for registra-

tion on its principal registry is prima facie evidence of

“the distinctiveness” of “Vision Center” as a trade

name. Abercrombie and Fitch Co. v. Hunting World, Inc., 537

F.2d 4, 11 (CA 2-1976); Union Carbide Corp. v. Ever-Ready,

Inc., 531 F.2d 366, 378 (CA 7-1976) cert. denied 429 U.S.

830, 97 S.Ct. 91, 50 L.Ed.2d 94.

5. I find that plaintiff’s trade name is “suggestive”

of the services and products it provides and is capable

of, and entitled to, full trade-name protection. Aber-

crombie and Fitch Co. v. Hunting World, Inc., 537 F.2d 4, 11

(CA 2-1976). It does not fall within those names de-

nied trademark protection. The trade name is not

generic. It does not name plaintiff's products or serv-

ices. Nor is it descriptive of plaintiff’s products and

services.

The definitions of the words “vision” and“center” do

not clearly imply a facility or group of facilities related

to eye care and its associated products as defendants

suggest.

38a

“Vision” is defined as “The act or power of seeing:

visual sensation or the capacity for it.”

The word “vision” does not imply eye care services or

products for the improvement of vision, and adding the

word “center” to “vision” does not supply the implica-

tion.

The word “center” is defined as:

“a place, area, person, group or concentration

marked significantly or dominatingly by an

indicated activity, pursuit, interest or appeal;

... a concentration of requisite facilities for

an activity, pursuit or interest along with vari-

ous adjunct conveniences . . . [e.g.] shopping

center, medical center, amusement center.”

6. Plaintiff has established that its trade name has

acquired a secondary meaning, and accordingly, plain-

tiff’s trade name, if descriptive, is capable of, and is en-

titled to, full trade name protection. Handy v. Com-

mander, 49 La.Ann. 1119, 22 So. 230 (1897); Kellogg Com-

pany v. National Biscuit Co., 305 U.S. 111, 59 S.Ct. 109, 83

L.Ed. 73 (1938); American Aloe Corp. v. Aloe Cream Labora-

turies, Inc., 420 F.2d 1248 (CA 7-1970), cert. denied 400

U.S. 820, 91 S.Ct. 37, 27 L.Ed.2d 47 (1971); Beef/Eater

Restaurants, Inc. v. James Burrough, Ltd., 398 F.2d 637 (CA

5-1968); Safeway Stores, Inc. v. Stephens (d/b/a Save-Way Food

Center and Dairy Bar), 281 F.Supp. 517 (W.D. La.-1967);

Kelly Girl Services, Inc. v. Roberts, 243 F.Supp. 225 (E.D.

La.-1965).

39a

7. Defendants’ federally registered trade name is

not incontestable as to plaintiff because plaintiff has

established prior appropriation and use in the local

market area; therefore plaintiff is entitled to full trade

name protection. 15 U.S.C. §1065 (The Lanham Act);

American Trading Co. v. H. E. Heacock Co., 285 U.S. 247,52

S.Ct. 387, 76 L.Ed. 740 (1932); Holiday Inv 0. Holiday Inns,

Inc., 534 F.2d 312 (Cust. & Pat.App.-1976).

8. Defendants’ use of the term or phrase “Pearle

Vision Center” in the Greater New Orleans area

amounts to trade name and trade mark infringement

and unfair competition; and the public is likely to be,

and has been, confused by such use. Handy v. Com-

mander, 49 La.Ann. 1119, 22 So. 230 (1897); Boogie Kings

v. Guillory, 188 So.2d 445 (La.App. 3d-1966), writ. ref.,

249 La. 761, 191 So.2d 140 (1966); American Trading Co.

v. H. E. Heacock Co., 285 U.S. 247, 52 S.Ct. 387, 76 L.Ed.

740 (1932); Beef/Eater Restaurants, Inc. v. James Burrough,

Lid., 398 F.2d 637 (CA 5-1968); and Safeway Stores, Inc. v.

Stephens (d/b/a Save-Way Food Center and Dairy Bar), 281

F.Supp. 517 (W.D.La.-1976).

9. The use of a trade name or a part thereof by a

latecomer after receipt of notice from the existing user

that such use violated or would violate the existing

user’s trade name gives rise to a presumption of intent

to deceive. Kelly Girl Services, Inc. v. Roberts, 243 F.Supp.

225 (E.D. La.-1965).

40a

10. From the facts found, the Court concludes that

the conduct of defendants constitutes fraud and that

fraud can be “reasonably inferred” from the conduct

and practices and proposed conduct and practices of

defendants. The conduct and practices of defendants

“amount to” fraud and are, at least, “tantamount” to

fraud. Straus Frank Co. v. Brown, 246 La. 999, 169 So0.2d 77

(1964); T.G.I. Friday's Inc. v. International Restaurant Group,

Inc., 569 F.2d 895 (CA 5-1978); T.G.I. Friday's Inc. v. Inter-

national Restaurant Group, Inc., 405 F.Supp. 698 (M.D.La.-

1975).

11. Thelatecomer into the market area, in this case,

the defendant, must bear the burden of avoiding con-

fusion, mistake, and deception, and the defendant has

failed to meet such a burden. Telechron, Inc. v. Telicon

Corp., 198 F.2d 903 (CA 3-1952); Safeway Stores, Inc. v.

Stephens (d/b/a Save-Way Food Center and Dairy Bar), 281

F.Supp. 517 (W.D.La.-1967); and Kelly Girl Services, Inc. v.

Roberts, 243 F.Supp. 225 (E.D.La.-1965).

12. The expenditure of considerable sums of

money by plaintiff (i) to advertise its name to the gen-

eral public, (ii) to protect its acquired goodwill, and (iii)

to protect its own exclusive use of its trade name, is a

substantial element in the maintaining of its burden of

proof, in showing that the issuance of a preliminary in-

junction is called for, to prevent irreparable injury. Kelly

Girl Services, Inc. v. Roberts, 243 F.Supp. 225 (E.D. La.-

1965); Beef/Eater Restaurants, Inc. v. James Burrough, Ltd.,

398 F.2d 637 (CA 5-1968).

th ms alk

4la

13. Plaintiff will suffer irreparable harm and in-

jury if defendants are allowed to commence business

using the trade name, “Pearle Vision Center.” Since the

damages resulting from defendants’ use of that name

cannot be quantified, no award of damages could

properly compensate plaintiff and, therefore, plaintiff

has no adequate remedy at law. P. Daussa Corp. v. Sutton

Cosmetics, Inc., 462 F.2d 134 (CA 2-1972); American Trad-

ing Co. v. H. E. Heacock Co., 285 U.S. 247,52S.Ct. 387, 76

L.Ed. 740 (1932); Handy v. Commander, 49 La.Ann. 1119,

22 So. 230 (1897); Dynasty Room, Inc. (d/b/a Whiskey-A-Go-

Go) v. Whiskey-A-Go-Go, Inc., 186 So.2d 402 (La. App.

4th-1966); Louisiana Revised Statutes 51:223.

The plaintiff's motion for preliminary injunction is

GRANTED.