Petition — Norden Restaurant Corp. v. Sons of the Revolution in the State of New York, Inc.

Supreme Court brief1981

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Office-Supreme Court, U.S.

. rth ep

3 0) “ 9 5 G

Te esauncanaa MAY 19 1981

ALEXANDER L. STEVAS,

IN THE CLERK

Supreme Court of the United States

OCTOBER TERM, 1980

NORDEN RESTAURANT CORPORATION,

Petitioner,

-against-

SONS OF THE REVOLUTION IN THE

STATE OF NEW YORK, INC.,

Respondent.

—

PETITION FOR A WRIT OF CERTIORARI TO THE

COURT OF APPEALS OF THE STATE OF NEW YORK

GREENSPAN & JAFFE

Attorneys for Petitioner

180 East Post Road

White Plains, New York 10601

(914) 946-2500

LEON J. GREENSPAN, ESQ.

JOSEPH D. DeSALVO, ESQ.

Attorneys

(11022)

QUESTION PRESENTED

Whether the order of the Court of

Appeals of the State of New York deprived

Petitioner of its valuable property

rights in the service mark "FRAUNCES

TAVERN" for Restaurant purposes without

due process of law by departing from the

applicable Federal and State statutory

and common law requiring a plenary trial

on the merits to resolve the material

issues of fact developed by the conflict-

ing affidavits and extrinsic evidence

which would preclude summary judgment as

a matter of law.

INDEX

Question Presented<<-<---<-----------

Opinions Below -------- a ethan

Jurisdiction --------<-<------------

Statutes and Rules Involved -------

Statement:

A. Historical Background ------~-

B. Ownership of the Serice Mark-

C. The Decision of the New York

Court of Appeals ------------

Reasons for Granting the Petition -

Conclusion ---------- ~<------- =

Appendix A --<-<<<<---<5<-<--------

Appendix B --<--<<<<<<<<<-----------

Appendix C -<<<<<<<<<----- -—-—--

Appendix D ---- om

Appendix D -<--<<<<<--<<<3-<--------

Appendix F <-<<<<--<<<<<<-<----------

Appendix G oe fre eee Setetieetiaetieetieetienstientintion

4la

46a

Page

CITATIONS

Cases:

Adickes v. S. H. Kress & Co.,

398 US 144, 157, 90 S.Ct. 1598,

1608, 26 L.Ed. 142 (1970)----- 30

Agosto v. Immigration and

Naturalization Service

436 US 748, 98 S.Ct. 2081, 2087,

56 L.Ed. 2d 677 (1978) -------- 32

Atterbury v. Bank of Washington

Heights, 241 NY 231, 238 (1925)-39

Barr v. County of Alban

40 NY 2d 547 554 (1980) ------- 30

Board of Education v. Licata,

’ 7) =--=----- 30

Board of Regents v. Roth,

408 US 564, 96 S.Ct. 2701,

33 L.Ed. 24 548 (1972) --9ee--- 50

Brawer v. Mendelson Bros. Fac-

tors, Inc.,

262 NY 53,56 (1933) ----<------ 40

Canal Company v. Hills

15 Wall TP. arr L.Ed. 64,68

(1872) --------- -~ -- 38

City of New York v. Third

Avenue RR Co.

294 NY 238,247 (1945) --------- 35

Falk v. Goodman,

’ 1959) -<—= 31

-iii.

Page

Cases (continued)

Glen Hall Mfg. Co. v. Hall,

61 NY 226 (1874) -- --- 48

Gillet v. Bank of America

160 NY 549,554-555 (1899) ----- 39

Kennedy v. Porter,

109 NY 526,544 (1888) ---------- 38

Lee v. Central of Georgia RR Co.

252 US 109, 40 S.Ct. 254,

64 L.Ed. 482 (1920) -- -- 50

Manson v. Curtis

233 NY 313, 320 (1918) -co----- 38

Mark Realty Corp. v. Hirsch,

180 AD 49,54 (lst Dept. 1917) - 48

Martin v. Crumb

216 NY 500,505 (1916) --------- 40

Milkwagon Drivers Union, etc.

v. Meadowmoor Dairies,

32 US 287, 61 S.Ct. 552, 132

ALR 1200, 85 L.Ed. 836 (1941) =- 50

Mutual Ins. Co. v. Hurni Co.,

263 US 167,174, 44 S.Ct. 90

(1923) so-<- on ean= 39

O'Neil Supply Co. v. Petroleum

Heat & Power Co.

280 NY 50,55 (1939) ----------- 38

Page

Cases (continued)

Perry v. Sindermann,

408 US 593, 92 A.Ct. 2694,

336 F.2d 570 (1972) --<-<-------- 50

Piedmont Hotel Co. v. Nettleton

Co.,

263 NY 24 (1933) -- --- 40

Poller v. Columbia Broadcasting

sysname Inc.,

US 6 ’ 82 S.Ct. 486,491,

7 LBA. 2458 (1968) -o-eee----- 31

Sarter v. Arkansas Natural

Gas Corp.,

321 US ES » 64 8.Ct. 724,728, é

88 L.Ed. 967 (1944) - om = 31

Shaw-v. Time-Life Records,

38 MY 2d 201,206-207 (1975) --= 30,41

Silliman v. Twentieth Century

Fox Film Corp.,

3 NY 2d 355-104 (1957) -—e---- 31,32

S. J. Capelin Asso. Inc. v.

Globe Mfg. Corp.,

34 NY 2a 368 sy

gaan (1974) oonoes-- 32

Steinberg v. Goodman,

NY ’ - (1970)---- 41

Stogop Realty Co. v. Marie

Antoinette Hotel Co.,

217 AD 555 (list Dept. 1926) ---27,34,43,

Page

Cases (continued)

Stone v. Goodson,

8 NY 2d 8,12 (1960) ----------- 31,41

The President and Trustees of

Colby College v. Colby College,

New Hampshire,

374 F.Supp. 1141 (D.NH 1974) -- 48

United Drug Co. v. Rectanus Co.,

248 US 90, 39 S.Ct.48,

63 L.Ed. 141 (1918) --<-------- 48

Ugarriza v. Schneider,

46 NY 2d 471,474 (1979) ------- 34

Zaldin v. Concord Hotel,

48 NY 24 107,114-115 (1979) --- 42

Statutes, Regulations and Rules:

United States Constitution,

Amendment 14, §l Tete fe eee 7,8,50

New York State Constitution,

Article 1, § 2-eeess-s<se------ 7

New York State Constitution,

Article 6, §3 sas pete bots t “ae aia ts arses, ah a einem 7,35

Lanham Act

15: 0.8.6; . $1127 6,47

28 U<8.C. §1257 (3) et ee Ce 3

CPLR §3212(b) a wocnnn=—- 4,30

‘vi

Statutes, Regulations and Rules (cont'd.)

CPLR §5501(b) -o--e------------ 35

General Business Law,

§360(a) (a-i) (a-iii) ----------- 5,47

General Business Law, §200 ---- 42

Miscellaneous:

17 Am.Jur. 2d, Contracts,

§§240-241, pp. 624-627 -------- 7

“Bank of Manhattan Historic

Buildings" (1914) ------------- 11

"Iconography of Manhattan

Island", I. N. Phelps Stokes,

Vol. 6, pp. 63 (1928) --------- 12,13

"Memorial History of the City

of New York", Wilson, iv. 233 - 12

10 N.Y. Jur., Contracts,

§§189-190, pp. 92-95 ---<<------ 37

"Powers of the New York Court

of Appeals", Cohen and Karger,

Rev. Ed. §107, pp. 447-449, --- 35

"Powersof the New York Court

of Appeals", Cohen and Karger,

Rev. Ed. §108, pp. 461-462 ---- 38

"Willison on Contracts", 3d Ed.

§629, pp. 919-921 ------------- 37

IN THE SUPREME COURT OF THE UNITED STATES

OCTOBER TERM, 1980

NO.

NORDEN RESTAURANT CORPORATION,

Petitioner

anipisy

SONS OF THE REVOLUTION IN THE

STATE OF NEW YORK, INC.,

Respondent

PETITION FOR A WRIT OF CERTIORARI

TO THE

COURT OF APPEALS

OF THE STATE OF NEW YORK

Norden Restaurant Corporation petitions

for a Writ of Certiorari to review the

Judgment of the Court of Appeals of the

State of New York which granted summary

judgment to the Respondent.

OPINIONS BELOW

The opinion of the Court of Appeals

of the State of New York (Appendix A,

Infra., pp. la - 6a) was reported at 51

NY 2d 518. The opinion of the Supreme

Court, Appellate Division, First Depart-

ment (Appendix B, Infra., pp. 7a - 3la)

is reported at 73 AD 2d 213. The opinion

of Supreme Court, New York County, Special

Term, Part I, (Appendix C, Infra., pp.

32a - 36a) is not reported officially.

The opinion of the Court of Appeals of

the State of New York extending the time

within which to move for reargument, and

thereafter denying reargument (Appendix D

Infra., pp. 37a - 38a) has not yet been

officially reported. The opinion of the

Supreme Court, Appellate Division, First

Department granting leave to appeal to

the Court of Appeals (Appendix E, Infra.,

pp. 39a - 40a is reported at 75 AD 764.

JURISDICTION

The judgment of the Court of Appeals

of the State of New York extending the

time within which to move for reargument,

and thereafter denying reargument, (Ap-

pendix D, Infra. p. 37a) was entered on

the 24th day of February, 1981. The

jurisdiction of this Court is invoked

under 28 U.S.C. §1257(3).

STATUTES AND RULES INVOLVED

CPLR §3212(b) which provides:

"(b) Supporting Proof; Grounds;

Relief to Either Party. A motion

for summary judgment shall be

supported by affidavit, by a

copy of the pleadings and by

other available proof, such as

depositions and written admis-

sions. The affidavit shall be

by a person having knowledge of

the facts; it shall recite all

the material facts; and it shall

show that there is no defense to

the cause of action or that the

cause of action or defense has

no merit. The motion shall be

granted if, upon all the papers

and proof submitted, the cause

of action or defense shall be

established sufficiently to war-

rant the court as a matter of

law in directing judgment in

favor of any party. Except as

provided in subdivision (c) of

this rule the motion shall be

denied if any party shall show

facts sufficient to require a

trial of any issue of fact. If

it shall appear that any party

other than the moving party is

entitled to a summary judgment,

the court may grant such judgment

without the necessity of a cross-

motion."

2. General Business Law §360(a) (a-i)

(a-iii) provides in pertinent part:

",...(a) The term ‘trade mark’ means

any word, name, symbol or device or

any combination thereof, adopted

and used by a person to identify

goods made or sold by him an to

distinguish them from the goods

made or sold of others.

"(a-i) The term ‘service mark'

means anything used in the sale

or advertising of services to

identify the services of one

person and distinguish them from

the services of others and includes

without limitation words, names,

symbols, tities, designations,

slogans, character names, and

distinctive features of radio and

other advertising used in com-

merce. ...

"(a-iii) The term ‘trade name'

means any name, title, or desig-

nation, or device lawfully

adopted and used by any person

engaged in any business, trade,

occupation or vocation to iden-

tify such business, trade, oc-

cupation or vocation and dis-

tinguish it from the business,

trad , occupation or vocation

of others whether or not regis-

tered, filed or recorded under

any law of the State of New York,

or of any other State, or the

United States of America. ..."

3. 15 U.S.C. §1127 provides in pertinent

part:

"The term ‘trademark’ includes any

word, name, symbol or device or

any combination thereof adopted

and used by a manufacturer or

merchant to identify his goods

and distinguish them from those

manufactured and sold by others.

"The term ‘service mark’ means a

mark used in the sale or adver-

tising of services to identify

the services of one person and

distinguish them from service of

others.

"The terms ‘trade name’ and ‘com-

merical name’ include individual

names and surnames, firm names

and trade names used by manufac-

turers, industrialists, merchants,

agriculturists, and others to

identify their business, voca-

tions or occupations; the names

or titles lawfully adopted and

used by persons, firms, associa-

tions, corporations, companies,

unions, and any manufacturing

industrial, commercial, agricul-

tural or other organization

engaged in trade or commerce

and capable of being sued or

being sued in a court of law."

4. New York State Constitution, Article

1, §2 provides in pertinent part:

"Trial by jury in all cases in

which it has heretofore been

guaranteed by constitutional

provision shall remain inviolate

forever; ..."

5. New York State Constitution, Article 6

§3 provides in pertinent part:

"The jurisdiction of the court

of appeals shall be limited to

the review of questions of law

except where the judgment is of

death, or where the appellate

division, on reversing or modi-

fying a final or interlocutory

judgment in an action or a final

or interlocutory order ina

special proceeding, finds new

facts and a final judgment or

a final order pursuant thereto

is entered; but the right to

appeal shall not depend upon the

amount involved."

6. United States Constitution, Amendment

14, §1 provides in pertinent part:

"All persons born or naturalized

in the United States and subject

to the jurisdiction thereof, are

citizens of the United States

and of the State wherein they

reside. No State shall make or

enforce any law which shall

abridge the privileges or immu-

nities of citizens of the United

States; nor shall any State de-

prive any person of life, liberty,

or property, without due process

of law; nor deny to any person

within its jurisdiction the

equal protection of the laws."

STATEMENT

A. Historical Background

The legal question before the Court

on this petition involves a complex of

buildings of historical significance and

it is this historical significance which

underlies and makes more egregious the

erroneous conclusiom reached by the

Court of Appeals of the State of New York.

The five building comple» owned by the

respondent, Sons of the Revolution in the

State of New York ("Sons") houses a

restaurant establishment owned and ope-

rated by the petitioner, Norden Restau-

rant Corporation ("Norden"), as well as

an historical museum owned and operated

by the Sons. The Sons rent out other

portions of the complex to other commer-

cial tenants. The corner building (at

Broad and Pearl) pre-dates before Revo-

lutionary War times and was the site of

George Washington's farewell speech to

his troops on November 24, 1783. This

building, within the complex was part of

the land of Col. Stephen VanCortlandt,

and stands on what was originally the

old shore line before filling extended

the City two blocks into the harbor. It

was constructed in 1719 as the private

residence of Stephen DeLancey, his son-ir

law, one of the Huguenot noblemen who

became promineit merchants of the early

town. About 1755 it became the private

residence of Col. Joseph Robinson, a part-

ner of Oliver DeLancey, and later became

the store and warehouse of the firm De~

Lancey, Robinson & Co.

In 1759 James Parker purchased the

premises, and used it as a general store

before it was purchased in 1762 by Samuel

Fraunces, who used the building as the

site of his "Queens Head" or "Queen

Charlotte” Tavern. It soon became one

of the most popular taverns in the town.

On April 8, 1768 the Chamber of Commerce

was organized in the long room and the

Sons of Liberty and the Vigilance Commit-

tee held a meeting in the Tavern in 1774.

The tavern was also the site of the or-

ganization of the Committee of Correspon-

dence which had so much to do with the

formation of the Continental Congress.

In 1783 Governor George Clinton gave a

dinner at the tavern in celebration of

Evacuation Day, which was attended by

George Washington and Chevalier de la

Luzerne. However, the events for which

the Inn is most famous is Washington's

farewell address to his troops in 1783.

In 1785 the tavern was sold by Fraunces,

and was eventually leased by John Gardi-

ner, father of Col. Asa Bird Gardiner,

former District Attorney, in 1837. The

New York Yacht Club was organized there

in 1844. The historic building was sub-

stantially destroyed by a disastrous fire

in 1832, and again was partly destroyed

by fire in 1852. Between the two fires

it was reconstructed, but fell upon hard

times, and was used as a saloon called

"The Broad Street House", patronized

mostly by teamsters and longshoremen.

[Bank of Manhattan Historic Buildings

(1914), (R-186, 192-194, 197)]

NOTE: Unless otherwise identified,

references preceded by the letter

"R" refer to the Record on Appeal

before the Court of Appeals, State

of New York.

Between May 12, 1768 and September 20,

1770, the tavern was kept by Bolton and

Sigel, and was known variously as "The

Queens Head Hotel” and "Bolton and Sigel's".

Samuel Fraunces regained control of the

Inn on September 20, 1770, and it re-

mained his until it was asta by him in

1785. (Memorial History of the City of

New York, Wilson, iv. 233.)

An examination of various historical

treatises, including "Iconography of

Manhattan Island" by I. N. Phelps Stokes,

Vol. 6, pp. 63 (1928) reveals that the

building was leased by Congress for two

years in April of 1785, just before it

was sold by Fraunces to one G. Powers on

April 23rd of that year. A John Francis

moved into the Tavern on May 27, 1789, and

then it was sold, successively, to a Dr.

Romayne, a J. Moore, and then to Thomas

Gardiner in 1795. A tavern was kept there

by one David Rose in 1804, while one R.

Kempp was the proprietor in 1813.

The Stokes volume (supra.) reveals

that Samuel Fraunces rented a location

at 16 Nassau Street on May 8, 1788, which

had been until then occupied by one Wil-

liam Marrener, and conducted a business

there under the management of his wife,

known as “Fraunces Tavern". Thereafter,

Mr. and Mrs. Fraunces moved the location

of their establishment to 48 Cortlandt

Street, and the name was changed to

"Fraunces Tavern" from "Rawson's Tavern".

While Samuel Fraunces conducted a

tavern at the corner of Broad and Pearl

Street, it does not appear to have been

conducted under the name"FPraunces Tavern".

However, business under that name was

conducted by Fraunces and his wife, first

at 16 Nassau and then at 48 Cortlandt

Street. It is conceded that by the time

the Sons acquired title to the building

at the corner of Broad and Pearl Street,

between 1904 and 1907, whether by bequest

and/or deed, the edifice was commonly

known as "Fraunces Tavern". (R-169-172,

186-193). Subsequently the Sons acquired

adjoining and adutting buildings so as to

complete the five building complex which

now houses, among others, both the museum

run by the Sons andthe restaurant run by

Norden.

Thirty years after completion and res-

toration of the complex, Robert Norden,

Sr., the father of the present owner of

the corporate petitioner, took over the

ownership and operation of the restaurant

facility, previously run by others, and

since that time "FRAUNCES TAVERN" and

"FRAUNCES TAVERN for Restaurant Services"

have been continually used in open and

notorious interchangeable fashion by

Norden and its individual predecessor,

Robert Norden, Sr. (R-227). As proprie-

tors Norden and the petitioner employed

numerous items in the day to day opera-

tion of the restaurant facility, all of

which bore the mark "FRAUNCES TAVERN", as

opposed to "FRAUNCES TAVERN RESTAURANT",

and used same in an open and notorious

fashion (R-228-229).

B. Ownership of the Service Mark

While the record contains references

to a restaurant business being conducted

in portions of the complex prior to 1937,

the record contains no references as to

the name of the restaurant facility loca-

ted therein with the exception of it

being a restaurant located at FRAUNCES

TAVERN. The record merely contains self

serving statements that the Sons exercised

coutrol over the prior restaurant opera-

tions but there are no lease provisions

to corroborate the same nor do the af-

fiants have personal knowledge. In addi-

tion, there is no evidence contained in

the record as to the Sons' actual par-

ticipation in the restaurant business of

Norden, or any predecessor prior to 1937

(R256-259). The record, however, con-

tains numerous references to the activi-

ties of the Sons directed toward the

preservation of the historic building and

the operation of the museum. Norden has

never disputed the museum activities or

the ownership of the building complex by

the Sons.

In December of 1977, the present lease

between the parties was executed as of

January 1, 1977 (R66-115). This agree-

ment contains no provision, reference or

claim by the Sons to ownership of the

service mark “FRAUNCES TAVERN for Restau-

rant Purposes"; no provision by which the

lease agreement is described to be a li-

censing agreement naming Norden as

licensee to use the service mark"FRAUNCES

TAVERN For Restaurant Purposes"; and

there are no provisions providing for a

reversion to the Sons of the right

to use or own the name or the service

mark "“FRAUNCES TAVERN for Restaurant

Purposes".

The Court of Appeals mistakenly relied

upon two clauses in the lease to support

its erroneous finding that the Sons own

the service mark “FRAUNCES TAVERN For

Restaurant Purposes". They are 43.04,

erroneously cited by the Court's decision

as 43.05 of the lease which states:

"The business conducted. by tenant

in the premises is only to be con-

ducted under the name 'FRAUNCES

TAVERN RESTAURANT" or such other

name as landlord shall from time

to time approve in writing pursuant

to the request of tenant."

and 440.01, which provides:

"The right to use the name 'FRAUNCES

TAVERN RESTAURANT’ in connection

with tenant's business shall be

limited to the restaurant busi-

ness conducted in the premises

and to no other businss or

location, and such right shall

terminate upon expiration or

earlier termination of this

lease."

Compare with the very similar almost iden-

tical provisions in the lease between the

parties in existence at the time Norden

obtained the registration of the service

mark (Appendix F Infra., pp. 4la-45a) be-

fore the execution of the present lease.

These two lease clauses clearly show

that Norden, not the Sons, is the owner

of the service mark “FRAUNCES TAVERN For

Restaurant Purposes". If the Sons claimed

ownership thereof such ownership would

have been stated, and a specific license

to use the name granted to Norden. In-

stead, the Sons directly acknowledged

Norden'’s ownership of the name by continu-

ing the restriction:(of its use to the

operation of a restaurant at the museum

premises. It is quite obvious that the

Sons operating a museum known as FRAUNCES

TAVERN MUSEUM in the same building with

the restaurant, would not wish to lease

the premises to a restaurant operator,

who had historically operated a restau-

rant at the premises, without getting an

agreement in writing to use Fraunces

Tavern Restaurant as the name under which

the restaurant would continue to be opera

ted. Surely the Sons would not want

Norden to call the restaurant "Norden's

Tavern." Furthermore, it was only good

business sense on the part of the Sons to

make sure that Norden would not operate

other restaurants at other locations,

using the name FRAUNCES TAVERN. While

restaurant chains have proliferated, the

Sons sought to protect its museum. This

was done by its economic power as land-

lord to restrict the use of Norden's

‘

trade name FRAUNCES TAVERN to the restau-

rant operated in the five building com-

plex and to force Norden to forbear from

operation elsewhere under the name

FRAUNCES TAVERN.

Similarly, the expiration or earlier

termination of the lease would terminate

Norden's right to use the name FRAUNCES

TAVERN in connection with the operation

of a restaurant on the premises of the

five building complex simply because

Norden's right of possession of the pre-

mises for the purposes of operating any

restaurant under any name would have

ended with the expiration or earlier ter-

mination of the lease. However, nowhere

does the lease prohibit the use by Norden

of the mark FRAUNCES TAVERN at other loca-

tions subsequent to the termination of

lease. This is perfectly consistent as

the Sons implicitly recognized their

inability to so do! If the Sons had any

right or title in the service mark

"FRAUNCES TAVERN For Restaurant Purposes”

either one of the foregoing clauses ({s

3.05 and 40.01) would have been an appro-

priate place to so state and, indeed, to

provide for a reversion of rights in the

name and mark to the Sons. The failure

of the Sons to provide such reversionary

provisions in the lease is eloquent evi-

dence, indeed, clear and convincing proof,

that the Sons neither had nor claimed

such right. Even the most cursory exami-

nation of this one-sided and prolix docu-

ment will reveal that this landlord omit-

ted nothing real, imagined, important or

perfunctory that could in any way be of

benefit, use, or even of interest to its

position. Surely a claim of right ina

service mark would have been clearly and

explicitly set forth. The absence of

such pronouncement of ownership is no

oversight. No claim was raised by the

Sons until petitioner commenced a lawsuit

and then only by way of an ambiguous

counterclaim for injunctive relief

The specific lease provisions set forth

above and relied upon by the New York

Court of Appeals, simply put, are not

evidence of acknowledgement by Norden of

any ownership by the Sons of the service

mark "FRAUNCES TAVERN For nestéurant

Purposes" and this fact is clearly sup-

ported by the record. Norden has con-

tinually urged and asserted that it owns

the service mark in conjunction with the

restaurant service and has so professed

not only to the Department of State for

the State of New York (R=-221), but also

to the United States Patent and Trademark

Office (R-205-207, 227). One can only

surmise from the record that this open

and notorious use of the mark has been ac-

quiesced in by the Sons since the record

contains no semblance of an objection to the

use of this mark by the Sons until the com-

mencement of the underlying litigation while

the mark has been affixed to items utilized

in the day-to-day operation of the restau-

rant facility on an ongoing and continuing

basis for 44 years by Norden!

While the record contains a copy of the

deed by which the Sons claim title to

the realty, together with the appurte-

nances attached thereto (R-169-172),

there is no evidence of the substance of

those appurtenances nor the efforts of

the Sons' predecessors in title toward

the development of the appurtenances

which would result in ownership of the

service mark "“FRAUNCES TAVERN For Restau-

rant Purposes". Neither the Sons nor any

predecessor prior to Petitioner appear to

have used the name in conjunction with a

restaurant operation.

It is significant that at no time has

the respondent ever made any claim that

the lease required reformation; raised no

mistake of scrivener; no mutual mistake;

and no unilateral mistake coupled with any

fraud on the part of Norden. Furthermore,

at no time has the respondent ever made

the assertion that it ever discussed with

Norden any claim of ownership in the ser-

vice mark "FRAUNCES TAVERN For Restaurant

Purposes". Any such claim is not a fact

but an afterthought -- the product of the

facile mind of attorneys seeking the ap-

propriation of Norden's property by

linguistic legerdemain and semantical

sophistry.

The Sons are a not-for-profit patriotic

organization responsible for restoration

of the subject premises, a historical

landmark, and operate a museum thereat

unchallenged by Norden. Norden seeks

merely to preserve the valuable property

right developed by its predecessor, and

registered by Norden,in the restaurant

they have operated for the past 43 years

under the name and service mark "FRAUNCES

TAVERN RESTAURANT". The Court of Appeals

of the State of New York, by granting

summary judgment has deprived petitioner

of those valuable property rights in the

ownership of the service mark "FRAUNCES

TAVERN For Restaurant Purposes" without

due process of law.

Under any review, State or Federal, the

most that can be said for the respondent's

position is that as a matter of law the

ownership of the service mark is a ques-

tion of fact! cCertiorari should be

granted:

C. The Decision of the

New York Court of Appeals

The Court of Appeals, under the guise

of holding that the Sons were entitled to

injunctive relief improperly granted

summary judgment which denied Norden its

day in Court. The Court deprived Norden

of its valuable property rights in the

service mark "FRAUNCES TAVERN For Restau-

rant Purposes without due process of law

for which it has obtained State Registra-

tion prior to the execution of the present

lease, having applied for Federal regis-

tration prior to the execution of the

lease, and having obtained the same subse-

quent to the commencement of this ligita-

tion, but prior to the decision of the

Supreme Court of the State of New York

at Special Term. In rendering this deci-

sion the Court of Appeals made the fol-

lowing erroneous determination in viola-

tion of both New York constitutional,

statutory and common law as well as in

violation of the Federal Constitution

and applicable statutes.

1. The Court of Appeals erroneously

took it upon itself to interpret two pro-

visions of the Lease and determine, as a

Matter of law, that the sons were the

owner of the service mark without refer-

ence to the well established legal prin-

ciples which precluded the same on a

motion for summary judgment;

2. The Court of Appeals erroneously

determined, as a matter of law, that the

Lease was a license from the Sons to

Norden for the use of the name"FRAUNCES

TAVERN: for Restaurant Purposes” and thus

misinterpreted and misapplied Stogop Real-

ty Co. v. Marie Antoinette Hotel Co.,217

AD 555; (Appendix G. Infra., pp. 46a-78a)

3. The Court of Appeals erroneously

determined that despite the prima facie

ownership established by State and Federal

registration, as a matter of law the Sons

were the owner of the service mark; and

that there was no issue of fact which

would preclude summary judgment.

Both Special Term of the Supreme Court

which initially denied summary judgment

(Appendix C Infra., pp.32a-36a) and the

majority opinion of the Appellate Division

First Department (Appendix B Infra., pp.

Ja-3la) clearly enunciated that as a

matter of law the ownership and validity

of the service mark was a question of fact

which precluded summary judgment. The

Court of Appeals apparently, in its opin-

ion (Appendix A Infra., pp. la-6a) graspei

upon the poorly reasoned dissenting opin-

ion cf the minority in the Appellate Divi-

sion, well criticized by the majority

opinion for the erroneous conclusion that

despite Federal and State registration;

despite open, notorious use; despite no

positive statement in the lease instrumert

as to ownership in the landlord; the Sons

were the owners of the service mark be-

cause the Sons were the owner of the rea

property, a portion of which was known as

Fraunces Tavern - despite the fact that

the Sons had never run a restaurnt in the

building, never made claim to ownership ¢&

the name "FRAUNCES TAVERN For Restaurant

Purposes and never claimed ownership of

the mark from prior owners of the name who

operated a restaurent thereunder at the

same premises. This is so because, until

Robert Norden Sr., in 1937, no one had

used the name "FRAUNCES TAVERN" for res-

taurant purposes nor registered the same:

Registration without use is worthless. But

use without registration is proof of owner-

ship. Together they are conclusive!

REASONS FOR GRANTING THE PETITION

A. The summary judgment statute,CPLR

§3212(b) permits the motion to be granted

only where,upon the papers and proof sub-

mitted, the Court is warranted as a matter

of law in directing judgment, and must be

denied where facts are shown sufficient

to require a trial of any issue of fact.

Where the movant cannot demonstrate as a

matter of law that there is no triable

issue of fact, summary judgment must be

denied. Board of Education v. Licata, 42

NY 2d 815, 816 (1977); Shaw v. Time Life

Records, 38 NY 2d 201, 207 (1975). This

Court has similarly stated in the case of

Adickes v. S.H. Kress & Co., 398 U.S. 144,

157, 90 S.Ct. 1598, 1608, 26 L.Ed. 142

(1970). See also Barr v. County of Albany

50 NY 2d 247,254 (1980).

Thus, the Court cannot grant summary

judgment even if there is only a doubt as

to the existence of a triable issue or

even if the issue is only arguable.

Rotuba Extruders v. Ceppos, 46 NY 2d 223,

231 (1978). This Court's view on the

granting of summary judgment is consistent

with New York case law as evidenced by

its decision in Sarter v. Arkansas Natu-

ral Gas Corp., 321 U.S. 620, 64 S.Ct.724,

728, 88 L.Ed. 967 (1944).

The Court myst accept the evidence of-

fered by the non-moving pe. y as true,and

a decision on the motion must be made on

the evidence and the facts most favorable

to the non-moving party Rotuba Extruders

v. Ceppos, supra.,; Poller v. Columbia

Broadcasting System, Inc., 368 US 464, 82

S.Ct. 486,491, 7 L.Ed. 2458 (1968). Issue

finding, rather than issue determination

is the key to the procedure. Stone v.

Goodson, 8 NY 2d 8,12 (1960); Falk v.

Goodman, 7 NY 2d 87,91 (1959); Silliman v.

Twentieth century Fox Film Corp., 3 NY 2d

395,404 (1957).

New York Courts have also consistently

held that a motion for summary judgment

must be supported by affidavits from

those having personal knowledge of the

facts. Thus, affidavits from attorneys

have little or no value. Zuckerman v.City

of New York, 49 NY 2d 557,560 (1980).

Similarly, the courts are not permitted

to determine credibility under the guise

of a motion for summary judgment, but

must determine only whether or not, as a

matter of law, there is a question of

fact. S.J. Capelin Asso.,Inc. v. Globe Mfg

Corp., 34 NY 2d 338,341(1974); Agosto v.

Immigration and Naturalization Svce.,436

US 748, 98 S.Ct.2081,2087, 56 L.Ed.2d 677

(1978)

The evidence before the motion court

(Sup.Ct. NY County, Spec. Term,Part I),the

intermediate appellate court (Appellate

Division of Supreme Court, First Dept.),

and our highest court (New York State

Court of Appeals), all demonstrated at

the very least, substantial issues of

fact, credibility, and contrary inferen-

ces to be drawn from both the intrinsic

document, the lease between the parties,

and the extrinsic evidence consisting of

historical background, the conduct of the

petitioner, and of greater significance,

the application for and the granting of

registration of the service mark under

both Federal and New York statutes. It is

without question that the New York State

Court of Appeals has misinterpreted its

own summary judgment rule; misapplied and

misconstrued rules of substantive law; ig-

nored the sharply conflicting inferences

to be drawn from relevant paragraphs of

the lease between the parties; and misap-

plied the inapt decision [Stogop Realty

Co. v. Marie Antoinette Hotel Co.,217 AD

555) ] (Appendix G.Infra., pp.45a-78a) all

in a manner so as to deprive the peti-

tioner of its valuable property -- the

service mark "FRAUNCES TAVERN For Restau-

rant Purposes"--without due process of

law in violation of accepted Federal and

State statutory and common law to the con-

trary. This, the Court of Appeals is not

permitted to do. Ugarriza v. Schneider, 46

NY 2d 471,474 (1979).

The Court of Appeals has exceeded its

ywn New York State constitutional and

statutory authority, since review to the

Court of Appeals is limited to questions

of law, except where the Appellate Divi-

sion, on reversing or modifying the final

or interlocutory judgment has expressly

or implicitly found new facts, *ad the

final judgment pursuant thereto was

entered. New York State Constitution, Art

VI, §3, CPLR §5501(b). Questions of fact

which are decided by the trial court are

put beyond the reach of the Court of Ap-

peals by the Appellate Division's affir-

mance. City of New York v. Third Ave. RR

Co., 294 NY 238,247 (1945). Also see

Cohen & Karger, “Powers of the New York

Court of Appeals", Rev.Ed. §107, pp.447-

449.

The distinction between law and fact

is cogently set orth by Messrs. Cohen

and Karger:

"The basic principle, too easily

overlooked in the welter of embel-

lishments and refinements » Py it,

is that a question of fact is

present if there is a conflict

either in the evidence or in the

inferences which can reasonably

be drawn from the evidence. ...

But even if the facts are not in

dispute, the question of fact

arises when the inferences from

those facts may reasonably lead

to differing conclusions."

Since both Special Term and the Appel-

late Division both found that as a matter

of law there were questions of fact concer-

ning not only the intent of the parties as

to the ownership of the service mark, but

as to the validity of the mark itself, the

Court of Appeals could reverse the Appel-

late Division, and grant summary judgment

to the respondent only if it found that as

a matter of law the intent of the parties

was so clearly expressed in the lease pro-

visions,that either extrinsic evidence was

not needed, or that it is so clearly sup-

ported the position of the respondent as

to justify the Court of Appeals, as a mat-

ter of law, in interpreting the document,

and divining the intent of the parties there-

from contrary to petitioner. By so doing

the Court of Appeals erroneously concluded

from ambiguous lease provisions despite

sharply conflicting affidavits and con-

flicting extrinsic evidence, that the

petitioner intended, by its execution of

the lease, to acknowledge the ownership

in the respondent of the service mark

"FRAUNCES TAVERN For Restaurant Purposes”.

B. The interpretation of a document

requires an ascertainment of the intention

of the parties. It becomes a question of

law only where intention is clear and un-

ambiguous, and only where there is no

need to resort to parole evidence or ex-

trinsic evidence in order to interpret the

intention of the parties. It is black

letter law--that ambiguous documents re-

quiring parole evidence or extrinsic evi-

dence from which divergent inferences can

reasonably be drawn--absolutely preclude

the resolution of the conflict by other

than a plenary trial. 10 NY Jur.,Con-

tracts, §§189-190,pp.92-95; 17 Am.Jur.2d

Contracts, §§240-241,pp.624-627; 4 Willi-

ston on Contracts, §629,pp.919-921 [3d Ed]

Cohen and Karger,"Powers of the Court of

Appeals", Rev.Ed. §108, pp. 461-462.

The Court of Appeals has uniformly ex-

pressed the rule that it was obligated to

seek the intent of the parties, and in so

doing not limit itself unnecessarily or

improperly. Kennedy v. Porter, 109 NY 526,

544 (1888).

This Court in Canal Company v. Hills,

15 Wall 94, 211 L.Ed.64,68 (1872), as wdl

as the New York Court of Appeals in O'Neil

Supply Co. v. Petroleum Heat & Power Co.,

280 NY 50,55 (1939) have recognized that

the fundamental law in the construction of

all agreements is to ascertain the sub-

stantial intent of the parties. The Court

is to consider the purpose of the object

to be advanced, Manson v. Curtis, 223 NY

313,320 (1918) and thus cannot look upon

a document with tunnel vision excluding

the circumstances surrounding the same in

order to avoid a factual in favor of a

legal resolution. For this reason the

equitable rule was developed that an am-

biguity in a contract is to be interpre-

ted strictly against he who prepared the

instrument or he who used the same and

sought the benefit of the provision.

Mutual Ins. Co. v. Hurni Co., 263 US 167

174, 44 S.Ct. 90 (1923); Atterbury v.Bank

of Washington Heights, 241 NY 231,238

(1925); Gillet v. Bank of America, 160 NY

549, 554-555 (1899). The Gillet Court

clearly stated the reasoning for the rule

"If the language of a promise may

be understood in more senses ‘han

one, it is to be interpreted in

the sense in which the promisor

had reason to believe it was

understood. [citations omitted]

Thus, the language in the lease must

be construed against the promisee Sons,

who insisted upon it and in the light most

favorable to the promissor Norden who

was obligated to conform thereto. A con-

struction to the contrary does violence

not only to the language of the lease,

but to the intent of the parties.

In the immortal words of Judge Cardozo

in Martin v. Crumb, 216 NY 500,505(1916):

"The most that could be said for

the defendant is that its meaning

is ambiguous and that its construc-

tion was for the jury."

Cf. Piedmont Hotel Co. v. Nettleton Co.,

263 NY 24 (1933).

It is respectfully submitted that the

same result should have been achieved by

the Court of Appeals in the instant case.

See Gravenhorst v. Zimmerman, 236 NY 22,

38-39 (1933); Brawer v. Mendelson Bros.

Factors, Inc., 262 NY 53,56 (1933).

A comparison of the old lease (Appen-

dix F. Infra., pp. 42a-45a) with the new

lease in the light of the extrinsic evi-

dence leads inescapably to the conclusion

that different inferences can be drawn as

to the intent of the parties with regard

to ownership of the service mark"FRAUNCES

TAVERN For Restaurant Purposes". Cf.

Stone v. Goodson, supra., Steinberg v.

Goodman, 27 NY 2d 304, 308-309 (1970),

where summary judgment was denied where

the Court determined that there was merdy

an arguable difference as to the intent of

the parties. In a more recent case, Shaw

v. Time-Life Records, 38 NY 2d 201,206-

207 (1975), the Court of Appeals, in what

was almost a classic case of plagerism

(nevertheless denied summary judgment).

Speaking for the Court, Judge Jason stated

"We believe that plaintiff has made

a sufficient factual showing to en-

title him to present his case to

the jury. A triable issue of fact

exists as to whether reasonably

discriminating members of the public

would be confused and misled by de-

fendant's advertising. Thus, in

this limited respect, the defendant's

motion for summary judgment is prop-

erly denied."

In what may be the most controlling

decision -- the Court of Appeals in

Zaldin v. Concord Hotel, 48 NY 2d 107,

114-115 (1979), determined that summary

judgment would not lie in order to permit

the Concord Hotel to take advantage of

§200 of the General Business Law, the

statute delineating the responsibilities

of the hotel industry with regard to the

valuables of its millions of patrons,when

it stated that if there was an intent to

limit liability the statute would have

said so. Similarly, if there was an in-

tent in the lease provisions before the

Court of Appeals to declare the respondent

the owner of the service mark, the lease

provisions would have said so. In either

case summary judgment was inappropriate,

since the intent of the Legislature in the

Zaldin case, as well as the intent of the

parties in this case, cannot be gleaned as

a matter of law from a mere examination

of the language used.

C. The Court of Appeals decision (Ap-

pendix A Infra.,pp.la-6a) is distorted by

a misinterpretation and misapplication of

the law of the case as contained in Sto-

gop Realty Co. v. Marie Antoinette Hotel

Co., Supra. (Appendix G Infra., pp.46a~78a)

Stogop's inapplicability is readily sup-

ported by an analysis of that case in con

trast to the factual pattern before this

Court, and as clearly shown by the majo-

rity opinion in the Appellate Division

(Appendix B Infra., pp.7a-3la).

The. decision in Stogop was rendered at

the conclusion of a complete trial where

the Court held that the name “Marie Antoi-

nette Hotel" had become inseparably con-

nected not only with the building, but

had become synonomous also with the hotel

business through the efforts of plaintiff's

predecessor. The Court had to determine

whether plaintiff, who had acquired the

premises by deed, obtained ownership

right in the name and service mark "Marie

Antoinette Hotel" along with ownership of

the building. Before the Court could make

such a determination, it first had to

evaluate the efforts expended by the per-

son from whom plaintiffs acquired title

relevant to the use by the vendor of the

name as a service mark in connection with

hotel services. This type of exami mtion

is relevant to the doctrine of "secondary

meaning", more specifically, the use of a

name in conjunction with a particular ser

vice. |

The plaintiffs leased the subject pre-

mises as a hotel to a lessee. Plaintiffs'

lessee thereafter conducted the hotel

business under the name “Hotel Marie An-

toinette”". The lease agreement between

plaintiffs and the lessee--aside from

describing and authorizing/licensing the

use of a particular name in conjunction

with the hotel business--specifically pro-

vided that the right to use o° the name

stopped at the expiration of the lease,

and that the use of the name would revert

to the plaintiff becoming once again its

sole property, unlike the instant case.

This provision of the lease agreement

clearly provided an acknowledgement of the

lessor's ownership in the service mark,

unlike the lease at bar.

The record before this Court is greatly

dissimilar having evolved out of the con-

text of a motion for summary judgment,and

not after a complete trial. The record

reveals a conflict with respect to the

Sons' predecessor in title relevant to the

development of the service mark "FRAUNCES

TAVERN For Restaurant Purposes". The Sons

rely upon the historical character,

Samuel Fraunces, as the predecessor from

whom it acquired its rights. However,

Fraunces did not use that name for restau-

rant services at this historic site, but

only at other locations! (supra. p.13)

Simply put, unless the Sons demon-

strate to this Court that they used the

service mark "FRAUNCES TAVERN" in conjunc-

tion with a restaurant service, a deter-

mination could not have been validly made

by the Court of Appeals naming the Sons

the owner of the service mark as a matter

of law. Stogop is an inapt authority for

that proposition!

D. The Court of Appeals took the un-

founded position that the Sons, through

acquisition of the five building complex,

acquired ownership of the mark for any

and all purposes, including the restau-

rant services performed by Norden.

General Business Law §360(a) (a-i)

(a-iii) provides definitions of the

terms “rademark", "service mark"

and "trade name". (Supra,p5)

The definitions as contained in

the General Business Law of New York

State are relatively consistent with

Federal definitions as contained in

the Lanham Act of 1946. These defini-

tions are contained in 15 U.S.C. §1127

(supra. ,p 5)

Pursuant to New York State common

law a party acquires rights in a ser-

vice mark, trademark or trade name

when that party has either used the

mark in conjunction with a particular

service, or a particular product, or

at a particular place where he con-

ducts a business under that name, so

as to render the mark valuable. Cf.

Glen Hall Mfg. Ca. v. Hall, 61 NY 226

(1874); Mark Realty Corp. v. Hirsch,

180 AD 49,54 (lst Dept. 1917)

The necessity of usage of the mark

in conjunction with either goods or

services is black letter law in New

York, and is entirely consistent with

Federal authority. United rug Co. v.

Rectanus Co., 248 US 90, 39 S.Ct. 48,

63 L.Ed. 141 (1918)

The service mark in issue herein is

"FRAUNCES TAVERN For Restaurant Pur-

poses" The mark is a hybrid combina-

tion of the surname ("FRAUNCES") and a

descriptive word ("TAVERN"). When a

mark

"... is a combination of personal

name and a descriptive or generic

wordit is notentitled to trade name

status unless it has acquired a

‘secondary meaning’ .“[emphasis

added] The President and Trustees

of Colby Colledge v. Colby College,

New Hampshire, 374 F.Supp. 1141

(D.NH 1ey4y-

The decision of the New York State

Court of Appeals is totally unsupported

by the record and in direct contradic-

tion to New York common and statutory

law, as well as the Federal statute. The

record, at the very least, demonstrates

a triable issue of fact relevant to

the issue of the ownership and validity

of the service mark. It is impossible

for one to acquire ownership rights to

a service mark when the party asserting

ownership has never used the mark in

conjunction with the services for which it

has become known in the context of this re

cord or purchased the same from onewho has!

The petitioner has continually main-

tained that the service mark is a

valuable property right of its business.

The failure of the Court of Appeals to

allow the issue of ownership to go to

trial, and summarily dispose of the

issue is clearly a denial of due process

as prescribed by the Fourteenth Amend-

ment of the United States Constitution.

(supra., pp. 7-8). Lee v. Central of

Georgia RR Co., 252 US 109, 40 S.Ct. 254,

64 L.Ed. 482 (1920); Board of Regents v.

Roth, 408 US 564, 96 S.Ct. 2701, 33 L.Ed.

2d 548 (1972); Perry v. Sindermann, 408

US 593, 92 S.Ct. 2694, 336 F.2d 570 (1972);

Milkwagon Drivers Union, etc., v. Meadow-

moor Dairies, 32 US 287, 61 S.Ct. 552,

132 ALR 1200, 85 L.Ed. 836 (1941).

CONCLUSION

For the foregoing reasons the decision

of the Court of Appeals of the State of

New York granting summary judgment is in

direct conflict with established precedent,

both New York and Federal, statutory as

well as common law, and a deprivation of

Norden's property rights without due process

of law, in direct violation of the

applicable Federal and New York con-

stitutional provisions. Certiorari

should be granted.

Respectfully submitted,

GREENSPAN & JAFFE

Attorneys for Petitioner

180 East Post Road

White Plains, New York

10601

914 946 2500

LEON J. GREENSPAN, ESQ.

JOSEPH D. DeSALVO, ESQ.

Attorneys

Dated: May 1981

APPENDIX

APPENDIX A

STATE OF NEW YORK

COURT OF APPEALS

No. 624

NORDEN RESTAURANT CORPORATION,

Respondent,

aye

SONS OF THE REVOLUTION IN THE

STATE OF NEW YORK

Appellant

William T. Livingston III, New York City

for Appellant

Joseph D. DeSalvo, White Plains, for

Respondent

Argued November 21, 1980

Decided December 22, 1980

OPINION

MEYER, J.

The sole question before us on this

appeal is whether Special Term properly

denied defendant's motion for summary

judgment on its third counterclaim, in

which defendant sought to enjoin plaimiff

"from using the name Fraunces Tavern,

from using any name other than Fraunces

Tavern Restaurant * * *", We hold that

defendant is entitled to such injunctive

relief.

Defendant owns the building at 54

Pearl Street in the Borough of Manhattan

which has been known since the eighteenth

century as "Fraunces Tavern". The build-

ing has been designated a national land-

mark and is primarily known as the site

where then General George Washington bade

farewell to his officers at the close of

the Revolutionary War.

The plaintiff is the tenant under a

lease executed in 1977 which entitles it,

subject to numerous restrictions, to con-

duct a restaurant business on the premi-

ses. Plaintiff asserts that the Norden

family has conducted a restaurant busiress

on the leased premises for over forty

years and that because of the lengthy as-

sociation of their restaurant business

with the name "Praunces Tavern" that name

has become synonymous with their restau-

rant and that they, therefore, have ac-

quired the exclusive right to use the

name.

This assertion is belied by several

provisions of the lease to which they con-

sented in 1977. Specifically, paragraph

3.05 of the lease provides as follows

"The business conducted by Tenant

in the premises is only to be con-

ducted under the name 'Fraunces

Tavern Restaurant’ or such other

name as Landlord shall from time to

"time approve in writing pursuant

to the request of Tenant."

Perhaps the clearest recognition of de-

fendant's ownership of the "Fraunces

Tavern" appellation is contained in para-

graph 40.01, which provided:

"The right to use the name 'Fraunces

Tavern Restaurant’ in connection

with Tenant's business shall be

limited to the restaurant business

conducted in the premises and to no

other business or location, and

such right shall terminate upon

the expiration or earlier termina-

tion of this Lease.”

Having recognized defendant's owner-

ship of the name "Fraunces Tavern Restau-

rant", and having accepted the licensed

use of the name upon the terms dictated

by the defendant, plaintiff cannot now

assert ownership of it as against defen-

dant (see Stogop Realty Co. v. Marie An-

toinette Hotel Co., 217 App Div 555).

Nor is the plaintiff's claim of

ownership advanced by the fact that even

as it negotiated the 1977 lease, it

applied to the United States Patent and

Trademark Office for registration of the

name "Fraunces Tavern" as a service-mark

and subsequently obtained such registra-

tion. It is well established that regis-

tration is not dispositive of the common

law rights of ownership of the trademark

(see Turner v. HMH Publishing Co., 380

F2d 224, 228; United States Jaycees v.

San Francisco Junior Chamber of Commerce,

354 F.Supp. 61, 70, affd. 513 F2d 1226),

but merely grants the registrant the

procedural advantage of establishing

prima facie ownership. The probative

value of that registration is but slight

in light of the facts that plaintiff ap-

plied for the service mark at a time

when it was conceding in negotiation that

defendant owned the name "Fraunces Tavern

Restaurant", and that the provisions of

the lease negotiated clearly establish

defendant's ownership of the name.

Defendant was entitled to summary

judgment on its third counterclaim.* The

order of the Appellate Division insofar

as appealed from should, therefore, be

reversed and the certified question ans-

wered in the negative.

8. 22° 8.08 2.6 e = = 8: 2.2 & &

Order, insofar as appealed from, revered

with costs, summary judgment granted to

defendant on the third counterclaim, and

question certified answered in the nega-

tive. Opinion by Meyer, J. All concur.

* The only issue briefed before us is

whether the order denying defendant's

motion for summary judgment on the third

counterclaim was proper. Accordingly,

we do not consider the propriety of so

much of the Special Term order as denied

defendant's motion addressed to the

second and fourth causes of action stated

in plaintiff's complaint.

APPENDIX B

SUPREME COURT, APPELLATE DIVISION

First Department, November 1979

Present: FRANCIS T. MURPHY,JR., P.J.

THEODORE R. KUPFERMAN

ARNOLD L. FEIN

JOSEPH P. SULLIVAN

DAVID ROSS, JJ.

Norden Restaurant Corporation,

Plaintiff-Respondent,

* -against-

Sons of the Revolution in the State

of New York,

Defendant-Appellant

6831

Appeal by the defendant-appellant

from so much of the order of the Supreme

Court, New York County (Hughes, J.), en-

tered on July 24, 1979, as denied defen-

dant's motiom to dismiss the second and

fourth causes of action set forth in

the amended complaint, denied defendart's

motion for partial summary judgment on

the third counterclaim set forth in the

answer and counterclaims, and granted

plaintiff's cross-motion to the extent

of dismissing a portion of the third

counterclaim.

William T. Livingston III, of counsel

Bachner, Tally & Mantell, attorneys) for

the defendant-appellant

Joseph D. DeSalvo, Esq., of counsel

(Greenspan & Jaffe, attorneys) for the

plaintiff-respondent.

Decided: First Department March 13,

1980

OPINION

ROSS, J.

The corporate defendant, formed in

1883, is a patriotic organization dedi-

cated to keeping alive the best tradi-

tions of the "Spirit of '76". This not-

for-profit corporation is the owner of

historic Fraunces Tavern, a five-building

interconnected complex located in lower

Manhattan. In 1904, defendant acquired

this property through a bequest from a

descendant of an officer on General

George Washington's staff, who was pres-

ent at the Commander-in-Chief's farewell

ceremony conducted at Fraunces Tavern.

Through the Society's efforts, this

building has been successfully restored

to its original "revolutionary" character.

The defendant now maintains its offices

there and is curator of an on-premises

museum.

10a

Plaintiff leases the main building

and portions of adjoining buildings of

this com lex and operates a restaurant

therein. The Norden family has operated

this food emporium for over forty years.

The plaintiff has at various times,

through various media and accoutrements

of plaintiff's trade, advertised the

name of this restaurant as Fraunces

Tavern. The existing lease signed in

mid-December, 1977, effective, January l],

1977, provides in pertinent parts:

§3.04 "The business conducted by

Tenant in the premises is only to

be conducted under the name

'Fraunces Tavern Restaurant’ or

such other name as Landlord shall

from time to time approve in

writing. ..."

§40.01 "Tenant convenants and

agrees that in any and all adver-

tising of the business of the

Tenant ... Tenant will in no way

state or imply that the buildings

are in any way the property of

Tenant or of the restaurant opera-

ted by it in the premises ... The

right to use the name ‘'Fraunces

lla

Tavern Restaurant’ in connection

with Tenant's business shall be

limited to the restaurant busi-

ness conducted in the premises and

to no other business or location.

Plaintiff, as lessee, instituted this

action for, inter alia, water damages

and to enjoin defendants from interfer-

ing with proposed interior remodeling.

Defendant, alleging breach of lease in

a third counterclaim, sought to enjoin

plainitff from using the name Fraunces

Tavern, and from prosecuting its Federal

trademark application. Special Term

denied defendant-appellant's motion for

partial summary judgment on the third

counterclaim and granted plaintiff's

cross-motion to the extent of dismissing

this counterclaim.

The question then presented by this

appeal is whether Special Term erred in

denying defendant-landlord's motion for

l2a

partial summary judgment enjoining

plaintiff-lessee's use of the service

mark Fraunces Tavern. On the facts pre-

sented herein, injunctive relief cannot

be granted summarily.

The terms “service mark" and "trade-

mark" are related concepts and both are

governed by identical standards (Boston

Professional Hockey Association v. Dallas

Cap & Emblem Mfg. Inc., 510 F 2d 1004

{5th Cir. 1975]; West & Co., Inc. v.

Arica Institute Inc., 557 F 2d 338 [2nd

Cir. 1977]). “Service mark" has been de-

fined as a mark used in the sale or ad-

vertising of services to identify the

services of one person and distinguishes

them from services of others. "Trademark",

although similarly defined, identifies a

manufacturer's or merchant's goods or

products. [Lanham Trade-Mark Act, 15

USCA §1127, see also General Business

l3a

Law §360(a) and (a-i)]. The twofold

Congressional intent for protecting

trademarks is:

"to protect the public so it may

be confident that, in purchasing

a product bearing a particular

trade-mark which it favorably knows,

it will get the product which it

asks for and wants to get. Sec-

ondly, where the owner of a trade-

mark has spent energy, time and

money in presenting to the public

the product, he is protected in

his ‘investment’ from its misap-

propriation by pirates and cheats."

(7 N.Y.L.F. 91, 92).

In this Court defendant argues that

through its efforts the mark "Fraunces

Tavern" has became synonymous with its

organization and with the maintenance

and preservation of a landmark steeped

in historical significance. Additional-

ly, the restrictive terms and conditions

in the current lease between defendant

and plaintiff prohibit the latter's use

ofthis mark. Therefore, the mark has

derived its sole uniqueness from these

l4a

labors and the Society is entitled to

the protection and good will flowing

therefrom. Plaintiff similarly argues

that the consuming public identifies the

mark in dispute as connoting a disting-

uished restaurant. The record on appeal

divulges conflicting substantial claims

by both parties. It is axiomatic that

both cannot claim the benefits of this

individual mark.

Each controversy in this area of the

law must be decided on its own merits

since the circumstances surrounding each

are not readily duplicated.

"Although this type of litigation

has been said to present mixed

questions of law and fact, the

emphasis, and rightly so, we be-

lieve, seems to have been placed

upon the fact pattern of each

situation (citations omitted).

Each case ... must be decided on

its facts. ..." (Dell Publishing

Co. v. Stanley Publications, 9

NY 2d 126, 133).

15a

Courts have long recognized that non-

commercial organizations are entitled,

under proper circumstances, to enjoin the

pirating of a mark by a junior user wen

though not in direct competition.

"Equity may also shield the thrust

by business into the kind of legal

rights acquired in areas entirely

removed from commercial activities."

(Cornell University v. Messing

Bakeries, Inc., 285 AD 490, 492;

aff'd. 309 NY 722).

Under any circumstances, whatever the

mark, the more viable it is in the current

market, the greater is its need for pro-

tection from unwarranted incursions.

"The real injury ... is the

gradual whittling away or dis-

persion of the identity and hold

upon the public mind of the mark

or name by its use on non-compe-

ting goods. The more distinctive

or unique the mark the deeper is

its impress upon the mblic con-

sciousness the greater its need

for protection against vitiation

or dissociation from the partic-

ular product in connection with

which it has been used."

[citation omitted] (Tiffany

16a

a.nd Company v. Tiffany Pro-

ductions, Inc., I47 Misa.679,

681-682; aft’d. 237 AD 801

aff'd. 262 NY 482).

Without question the mark Fraunces Tav-

ern is recognized by the consuming public

in the local market place, if not the

national. Whether the common man recog-

nizes this mark as synonymous with an his-

toric setting, or as a restaurant, cannot

be decided in the absence of a complete

trial. For this reason our dissenting

colleagues’ reliance on Stogup Realty Corp,

‘

v. Marie Antoinette Hotel Corp., (217 AD

555) is misplaced. There, a full hearing

was concluded before a determination was

rendered, and, moreover, the subject pre-

mises were specifically constructed for

the use to which they were put. In

Stogup Realty Corp. v. Marie Antoinette

Hotel Corp., supra, the Court found that

the name "Hotel Marie Antoinette" had be-

come inseparably connected with the

17a

building, and had become snyonymous with

the hotel business through the efforts of

plaintiff's predecessor. Here, Fraunces

Tavern was built for the use the name

implies and has been so utilized in that

manner since 1763. On the record before

us it cannot summarily be said that the

name Fraunces Tavern has become "appurte-

nant to and inseparably connected" with

the defendant Society. These incompatible

assertions must be resolved at trial.

The defendant, as landlord and owner

of a building in which plaintiff under-

took a commercial venture, possesses a

valued interest in its buildin s name,

which is entitled to protection. However,

as a result of steady and gradual usage

and development, such a name may acquire

a secondary meaning as indicating the par-

ticular business housed in the building.

(60 NY Jur. Trademarks §100). Where such

18a

mark has acquired this distinctive mean-

ing, the user thereof is entitled to the

same protection as would be accorded a

"technical" trademark.

"Secondary meaning can be es-

tablished by showing that

notwithstanding the absence of

an arbitrary, fanciful or coined

expression, a trade-mark or trade

name has, through exclusive use

and advertising by one entity,

become s%° associated in the mind

of the public with that entity

or its product that it identified

the goods sold by that entity

and distinguishes them from

goods sold by others.” (Allied

Maintenance Corp. v. Allied

Mech. Trades, NY 538, 542

[footnote 2]).

The ability of a mark to acquire a

secondary meaning will rarely be estab-

lished overnight. Such is uniquely

attainable through a gradual evolution.

Acceptance thereof will be acknowledged

when a substantial section of the buying

public can equate that mark with a parti-

cular business and no other. (3 Callman,

19a

Unfair Competition Trademarks iand Mono-

polies §77.4).

The issue then is whether either par-

ty through its individual efforts can be

credited with ascribing a secondary

meaning to the mark Fraunces Tavern.

After a trial if it can be determined

that this mark exclusively identifies a

particular business, and the buying pub-

lic would thereby be confused, then that

business is entitled to the service mark

protection (Matter of Playland Corp. v.

Playland Center, 1 NY 2d 300).

In trademark law, as in other matters

of equity, good faith is an indispensable

component. No right of ownership can be

acquired in a service mark which is not

registered or adopted in good faith (15

USCA §1064; N.Y. Jur., supra, §17). De-

fendant argues that this element is lack-

ing. The existing lease was negotiated

20a

throughout 1977, and it is alleged that

a major portion of these discussions cen-

tered on utilization of the mark Fraunces

Tavern. However, prior to signing of this

document, plaintiff on October 28, 1977,

caused to be served an application with

the U.S. Patent and Trademark Office

seeking to register the service mark

Fraunces Tavern*. The Society maintains

this procedure was commenced at a time

when plaintiff was aware that its use of

the service mark was in dispute, and

moreover violated the restrictive condi-

tions of the lease.

The question of good faith, or the

lack thereof, is an issue, under these

circumstances, which cannot be disposed

of summarily. The familiar refrain that

the key to summary judgment is "issue

*This mark was subsequently registered

on September 11, 1979.

2la

finding rather than issue determination."

(Sillman v. Twentieth Century Fox Film

Corp., supra.; Pollard v. Meyer, 61 AD 2d

766 [First Department 1978]). Here we

have substantial questions of fact that

cannot be disposed of in advance of trial.

Accordingly the order of Supreme Court

New York County (Hughes, J.), entered on

July 24, 1979, which, inter alia denied

defendant-appellant's motions to dismiss

the second and fourth causes of action

contained in the complaint and denied

defendant's motion for partial summary

judgment on the third counterclaim in

appellant's answer, seeking to enjoin

plaintiff's use of the service mark

Fraunces Tavern, and granting plaintiff's

use of the service mark Fraunces Tavern

and granting plaintiff's cross-motion to

the extent of dismissing the third coun-

22a

terclaim should be insofar as appealed

from, affirmed, without costs and without

disbursements.

All concur, except Murphy, P.J., and

Kupferman, J., who dissent in part

in an opinion by Kupferman, J.

KUPFERMAN, J. (dissenting in part):

Fraunces Tavern on Pearl Street in

lower Manhattan is a landmark. It was

operated by Samuel Fraunces, and it was

here that General George Washington in

1783 said goodbye to his revolutionary

comrades in arms. On the 100th anniver-

sary of Washington's farewell, there was

organized the patriotic organization,

Sons of the Revolution, the defendant-

appellant herein, whose purpose was to

keep alive the spirit of '76. Itisa

not-for-profit corporation.

In 1904, as the result of a bequest,

23a

the appellant was enabled to purchase the

building comprising Fraunces Tavern. It

had since its organization been working

to restore and preserve the building, and

it has maintained it in a condition close

ly approximating the original architectire

and appearance. It has acquired owner-

ship of neighboring buildings which are

interconnected with the Tavern, and a mu-

seum is there maintained. Portions of the

Tavern have been rented for operation as

a restaurant, with the appellant as land-

lord since 1907. In 1937, the plaintiff-

respondent became the tenant of the res-

taurant, with the current lease becoming

effective January 1, 1977 for a term end-

ing October 31, 1991. The lease contains

provisions which give the appellant the

right to control, in terms of quality,

taste and fashion, the operation of the

restaurant business.

are

24a

Among other provisions in the lease

the following:

Section 3.04. The business con-

ducted by Tenant in the premises

is only to be conducted under the

name "Fraunces Tavern Restaurant"

or such other name as Landlord

shall from time to time approve in

writing pursuant to the request

of Tenant.

Section 6.02. "Landlord reserves

the right to name the Buiiding and

to change the name or address of

the Building at any time and from

time to time. ...

Section 29.01. Tenant, recog-

nizing that the Buildings have

been maintained as an historical

landmark and as an additional in-

ducement to Landlord to enter into

this Lease, covenants and agrees

that at all times (i) the business

to be conducted at, through and

from the premises and the kind

and quality of the merchandise,

food, and services offered in the

conduct thereof will be reputable

in every respect, (ii) the sales

methods employed in said business,

as well as all other elements of

merchandising, will be dignified

and in conformity with the highest

standards of practice obtaining

among superior type stores, shops

and restaurants dealing in the

same or similar merchandise, food

and service or conducting a

25a

similar high-quality restaurant

business in the Wall Street

business district adjacent

thereto, and (iii) the kind and

quality of food and beverages

and of the merchandise sold at,

through or from the premises by

Tenant shall be excellent in all

respects, and (iv) the appearance

of the premises (including the

lighting and other appurtenances

thereto), the appearance and de-

portment of all personnel employed

therein, and the appearance, number,

location, nature and subject matter

of all displays and exhibits

placed or installed in or about

the premises, and of any signs,

lettering, announcements, price

schedules, tags or any other

kinds or forms of inscriptions

displayed in or about the premises,

will be only such as does not meet

with Landlord's reasonable disap-

proval and, if at any time rea-

sonably disapproved by Landlord,

Tenant shall remove the basis for

such disapproval in such manner

and within such reasonable time

as may be specified by Landlord,

in a written notice by it to

Tenant for such purpose. Land-

lord believes that the operation

by Tenant of its business at the

premises is, as of the date hereof,

generally in conformity with the

standards hereinabove in this Sec-

tion 29.01 set forth.

Section 39.04. Tenant shall remove

all such lettering, improvements

and modifications upom the termina-

26a

tion of its Lease and shall re-

pair any damage to the building

or the sign occasioned thereby.

Section 40.01. Tenant covenants

and agrees that in any and all

advertising of the business of

Tenant conducted in or from the

premises whether through written,

typewritten, mimeographed or

printed circulars, radio pro-

grams, notices in the public press

and publications, signs or by

means of any other advertising

media, Tenant will in no way

state or imply that the Build-

ings are in any way the property

of Tenant or of the restaurant

operated by it in the premises.

Tenant further covenants and ag-

rees that it will not alter or

distort the account of any his-

torical fact respecting the

premises or the Buildings in any

of its advertising through any

of the above described media or

through any other media. Adver-

tising material used and paid for

by Tenant should describe the busi-

ness of Tenant conducted in the

premises only as "Fraunces Tavern

Restaurant". If Tenant, after

warning that a violation of the

above conditions has occurred,

shall thereafter repeat the same

or a similar violation, Landlord

may require and Tenant covenants

and agrees that it will immedia-

tely, at its sole cost and expense,

retract any such statement, impli-

cation, or error of historical

fact to which Landlord shall have

27a

made objection in any and all of

the advertising media in which such

violation shall have occurred. The

wording of such retraction shall be

submitted to Landlord before publi-

cation and Landlord's approval

of such retraction in writing

shall be obtained by Tenant

which covenants and agrees that

it will give to such retraction

display or prominence equal to

the display or prominence given

to the advertising to which Landlord

has taken exception as above set

forth. The right to use the name

"Fraunces Tavern Restaurant" in

connection with Tenant's business

shall be limited to the restaurant

business conducted in the premises

and to no other business or loca-

tion, and such right shall ter-

minate upon the expiration or

earlier termination of this Lease.

Any regular doorman or person

operating checking facilities on

the premises shall, labor condi-

tions permitting, be costumed in

Colonial Costume consisting of

powdered wig, tailcoat, breeches,

long hose and display buckles on

shoes, so designed as to portray in

true and authentic manner the dress

in use during the era of the

American Revolution.

It is readily apparent that this is

not a mere naked license discussed in

Ritz Assoc. v. Ritz-Carlton Hotel Co., 35

Misc. 2d 425, aff'd. without op. (but

28a

with one dissent), 19 AD 2d 522, aff'd.

without op. 14 N.Y. 2d 670. It is owious

that by reason of ownership, intention,

long usage and contract, the name Frawces

Tavern is the property of the defendant-

appellant. It has acquired a "secondary

meaning" indicating the defendant-appel-

lant. See “Untangling the Confusion in

Trademark Terminology: by Sidney A. Dia-

mond, ABA Journal, October, 1979, Volume

65, p. 1523, 1525. The right to use the

name is inseparably associated with the

building involved, Stogup Realty Co., Inc

v. Marie Antoinette Hotel Co., 217 App.

Div. 555 (lst Dept., 1926).

In this litigation, the plaintiff

sues, among other things, in the nominal

course of a tenant-landlord relationship,

for water damage, a claim with respect to

rent, etc. In addition, it contends that

in connection with a grant of permission

29a

from appellant-landlord to respondent-

tenant to construct a coatroom enclosure,

there were impermissible conditions at-

tached with respect to the use of the

words Fraunces Tavern on items to be sold

in the operation of the coatroom.

Among other things, the defendant-

appellant landlord set forth various af-

firmative defenses and counterclaims, in-

cluding a third counterclaim to declare

its rights in the name Fraunces Tavern

and to enjoin the respondent from prose-

cuting an application for a U.S. trade-

mark in the name. In the interim, after

the date of the order herein denying

summary judgment to either side on a mo-

tion and cross-motion, a certificate of

registration was issued by the U.S. Patent

and Trademark Office to the plaintiff-

respondent tenant for a service mark for

Fraunces Tavern. It is possible for a

30a

licenseesuch as the plaintiff to obtain

a service mark as a "related company",

pursuant to Sections 5 and 45 of the

Lanham Act, 15 U.S.C. 1055 and 1127. See

"What the General Practitioner Should

Know About Trademarks and Copyrights" by

Arthur H. Seidel (4th ed. 1979) ALI-ABA,

p.117.

The landlord, by virtue of its lease,

being in legitimate control of the usage

of the mark, would therefore be a bene-

ficiary of the registration, and the

licenseecould not use the mark in adver-

tising or labeling in any manner other

than that specifically authorized by the

licensor. See "An Introduction to Trade-

mark Practice" by Martin J. Beran, Chap-

ter 3(4), p.128-129.

I would grant partial summary judg-

ment to the defendant-appellant landlord

on the third counterclaim, declaring its

3la

rights in the trademark. There does not

seem to be any real dispute with respect

to the right of the tenant to construct

the cloakroom, and therefore summary

judgment should be granted to the plain-

tiff-respondent on the second cause of

action. However, the right to construct

the cloakroom does not carry with it any

rights with respect to any items to be

sold therein with the name Fraunces Tav-

ern used, without the permission of the

landlord, subject to the terms of the

lease.

32a

APPENDIX C

SUPREME COURT, NEW YORK COUNTY

SPECIAL TERM, PART I

NORDEN RESTAURANT CORP.,

Plaintiff

-against-

SONS OF THE REVOLUTION IN THE STATE OF

NEW YORK, INC.,

Defendant

Index No. 20981/78

Decided July 23, 1979

33a

DECISION

HUGHES, J.:

The papers on both sides of this

motion and cross motionare to a great

extent vague, vexatious, and unintelli-

gible, and fail to address the issues

raised. Nevertheless, the Court will

attempt to render a disposition.

The cross motion by plaintiff to dis-

miss defendant's third counterclaim is

granted only to the extent that the

portion of the third counterclaim seek-

ing to enjoin plaintiff from prosecuting

an application for a trademark before the

United States Patent Office is dismissed.

No authority is shown by which this State

Court can restrain a party from prosecu-

ting an application before that agency

of the Federal Government. The argu-

ments by both sides as to the merits of

the application for the trademark, or of

34a

the legal effect of the granting or

denial by the Patent Office of that ap-

plication are irrelevant. The cross

motion is otherwise denied. Defendant's

main motion, insofar as it seeks summary

judgment on the third counterclaim, is

also denied. Neitherside shows a clear

right to the use or ownership of the

trademark or tradename in issue. In

this regard, it must be noted that the

issue raised by defendant, of a lessee's

estoppel to deny a landlord's title to

demised real property (Tilyou v. Reymlds

108 NY 558),is irrelevant.

The subject matter of the controversy

at bar is not title to real property of

which plaintiff is defendant's lessee,

but the right to the use of a trademark

or tradename of which plaintiff is de-

fendant's licensee. The doctrine of

licensee estoppel no longer holds. (Lear,

35a

Inc. v. Adkins, 395 US 653).

Defendant's main motion, insofar as

it seeks dismissal or removal of plain-

tiff's fourth cause of action, is

denied. There is not shown a sufficient

identity of issues with the prior action

described in the papers.

The main motion, insofar as it seeks

dismissal of the second cause of action,

is denied. No clear showing is made as

to the right or lack of right of plain-

tiff to undertake the construction in

issue.

| The relief sought in defendant's “sup-

plemental notice of motion" is denied on

the merits, although the Court could

have chosen to deny the request without

prejudice, as a procedural impropriety.

As noted, supra, neither side shows a

clear right to the trademark or service-

mark in issue, and the request to direct

36a

the New York Secretary of State to can-

cel plaintiff's registration of the mark

and for damages, cannot summarily be

granted.

Dated: July 23, 1979

T.J.H.

J.Ss eCo

37a

APPENDIX D

STATE OF NEW YORK,

COURT OF APPEALS

At a session of the Court, held

at Court of Appeals Hall in the

City of Albany on the twenty-

fourth day of February A.D. 1981

PRESENT, Hon. Lawrence H. Cooke, Chief

Judge, Presiding

Mo. No. 162

NORDEN RESTAURANT CORPORATION,

Respondent

vs.

SONS OF THE REVOLUTION IN THE

STATE OF NEW YORK, INC.,

Appellant

38a

A motion having heretofore been made

herein upon the part of the respondent

(a) for an extension of time within which

to move for reargument and (b) for rearg-

ument of the above cause to this Court,

papers having been submitted thereon and

due deliberation having been thereupon

had, it is

ORDERED, that the said motion, inso-

far as it seeks an extension of time, be

and the same hereby is granted; and it is

ORDERED, that the said motion, insofar

as it seeks reargument, be and the same

hereby is denied.

/s/ JOSEPH W. BELLACOSA

Clerk of the Court

39a

APPENDIX E

Order of the Appellate Division

Granting Leave to Appeal

to the Court of Appeals

At a term of the Appellate Division

of the Supreme Court held in and for

the First Judicial Department in the

County of New York, on May 13, 1980

Present: Hon. Francis T. Murphy, Jr.,PJ

Theodore R. Kupferman

Arnold L. Fein

Joseph P. Sullivan

David Ross, Justices

M-1555

Norden Restaurant Corporation,

Plaintiff-Respondent,

-against-

Sons of the Revolution in the

State of New York,

Defendant-Appeliant

40a

The above-named defendant-appellant

having moved for reargument of, or for

leave to appeal to the Court of Appeals

from, the order of this Court entered

on March 13, 1980,

Now, upon reading and filing the no-

tice of motion, with proof of due service

thereof, and the papers filed in support

of said motion, and the papers filed in

opposition or in relation thereto; and

due deliberation having been had thereon,

It is ordered that said motion, inso-

far as it seeks reargument, be and the

same hereby is denied, and said motion,

insofar as it seeks leave to appeal to

the Court of Appeals is granted and this

Court, pursuant to CPLR 5713, certifies

that the following question of law, de-

cisive of the correctness of its determi-

nation, has arisen whch in its opinion

4la

"Was the order of the Supreme Court,

as affirmed by this Court, properly

made?"

This Court further certifies that its de-

termination was made as a matter of law

and not in the exercise of discretion.

ENTER

JOSEPH J. LUCCHI

Clerk

42a

APPENDIX F

AGREEMENT OF LEASE, made as of this 23rd

day of November, 1971 between

SONS OF THE REVOLUTION IN THE STATE

OF NEW YORK, INC., a New York member-

ship corporation, haYing an office at

54 Pearl Street, New York, New York,

party of the first part, hereinafter re-

ferred to as LANDLORD, and

NORDEN RESTAURANT CORP., a New York

corporation, having an office at

54 Pearl Street, New York, New York,

party of the second part, hereinafter

referred to as TENANT.

WITNESSETH: Landlord hereby leases to

Tenant and Tenant hereby hires from Land-

lord the premises described in paragraph

38-A of the rider attached hereto and

made part hereof for the term of (or un-

til such term shall sooner cease and ex-

pire as hereinafter provided) to commence

43a

on the lst day of December nineteen-

hundred and seventy-one, and to end on

the 30th day of November nineteen hun-

dred and eighty-five both dates inclusive

at an annual rental rate reserved in

paragraph 39-A and additional rent as

herein provided.

41. Tenant may place a sign on the frmt

of the building at 58 Pearl Street to

read "Fraunces Tavern Cocktail Lounge",

said sign to be of a colonial design,

and otherwise subject to the approval of

Landlord, which approval shall not be

unreasonably withheld, as to the size,

design and location of said sign.

Tenant may also place a sign on the

front of the building known as 26 Water

Street provided it first secures the

written approval of the Landlord as to

the size, design and location of said

44a

sign and what is to be printed thereon.

Before erecting any such sign, Tenant,at

its cost and expense, will secure any

permit that may be required by the gov-

ernmental authorities having jurisdiction

for the construction, installation and

maintenance of any such signs.

47. Tenant covenants and agrees that in

any and all advertising of the business

of Tenant conducted in or from the De-

mised Premises whether through written,

typewritten, mimeographed or printed

circulars, radio programs, notices in the

public press and publications, signs or

by means of any other advertising media,

Tenant will in no way state or imply that

the building or buildings owned and main-

tained by Landlord are in any way the

property of Tenant or of the restaurant

operated by it in the Demised Premises.

45a

Tenant further covenants and agrees that

it will not alter or distort the account

of any historical fact respecting the

Demised Premises or the buildings of

which they are a part in any of its ad-

vertising through any of the above

described media or through any other

media. Advertising material used and

paid for by Tenant should describe the

business of Tenant conducted in the De-

mised Premises, described in lease dated

November 22, 1965 only as "Fraunces

Tavern Restaurant" .. . The right to use

the name "Fraunces Tavern Restaurant" in

connection with Tenant's business shall

be limited to the restaurant business con-

ducted in the Demised Premises and to no

other business or location and such right

shall terminate upon the expiration or

earlier termination of this lease.

46a

APPENDIX G

STOGOP REALTY CO., INC., and Others,

Appellants, v. MARIE ANTOINETYE HOTEL

COMPANY, Respondent

First Department, July 6, 1926

(217 AD 555)

[headnotes omitted]

APPEAL by the plaintiffs, Stogop

Realty Co., Inc., and others, from a judg

ment of the Supreme Court in favor of the

defendant, entered in the office of the

clerk of the county of New York on the

lst day of July, 1924, upon the report

of a referee appointed to hear and deter-

mine the whole issues.

[Appearance of counsel omitted]

WAGNER, J.

This action was brought to enjoin the

defendant from using the name Marie Antoi-

nette, or any simulation thereof, in

connection with an hotel, and to secure

47a

relief specified in the complaint. The

facts in this record are practically un-

disputed and the only question before

the court is one of law.

In 1892 one William L. Flanagan owned

the premises at the northwest corner of

Sixt y-sixth street and Broadway in the

city of New York. During the years 1893

and 1894 he erected a building upon these

premises, which was specially constructed

for the purposes and uses of an hotel.

During the course of construction Mr.

Flanagan determined to adopt and to appro

priate the name "Marie Antoinette" to

designate this hotel building, and with

this purpose in view caused such name to

be cut into the stone work over the en-

trance to the building where it still

remains. The initials "M.A." were wrought

into the design of the ornamental iron

gates and grill work at the entrance to

48a

the building, all of which are still in

place and these letters were upon all

the door knobs, upon the iron gratings

and the elevator doors, upon the lighting

fixtures, decorations and on other parts

of the building. When completed, the

building was an eight-story structure

containing approximately 159 guest rooms,

excluding bathrooms, and was in all other

respects fully and adequately equipped

for the operatim of a first-class hotel.

It was completely furnished by Mr Flanagan,

the linens being imported and having a

crest with the initials "M.A." woven

threin, and the dishes and furniture were

also marked with the same letters. After

some advertising, the hotel was opened to

the public by Mr. Flanagan on October ll,

1894, and for the succeeding eight years,

and until October 12, 1902, he or his

representatives conducted the establish-

49a

ment as an hotel. During this period it

was the only hotel in New York known by

that name.

On July 19, 1901, said Flanagan, the

owner, made a deed of his property, in-

cluding the Hotel Marie Antoinette, to

certain trustees under which deed the

trustees became the owners in fee of

said hotel premises and the owners and

proprietors of the hotel business. This

deed was accompanied by a declaration of

trust which provided, among other things,

that the trust deed should become void

upon the death of William L. Flanagan.

This occrred on January 18, 1903.

Prior to 1903 there was a vacant lot

to the north of the"Hotel Marie Antoin-

ette" at the southwest corner of Sixty-

seventh street and Broadway, which lot,

together with the "Hotel Marie Antoinette”

building just described, covered the

50a

entire frontage on the westerly side of

Broadway which lot, together with the

"Hotel Marie Antoinette" building just

described, covered the entire frontage on

the westerly side of Broadway between

Sixty-sixth and Sixty-seventh streets.

The Sixty-seventh street lot was owned by

a New York corporation known as the Boule-

vard Corporation.

On February 19, 1902, a lease for

tewnty-one years was made between Albert

R. Keen, as lessee, and William L. Flana-

gan personally and the Flanagan trustees

under the deed of trust, as lessors,

covering the Sixty-sixth street premises

together "with the building thereon

erected, known as the Hotel Marie Antoi-

nette, together with the right to the

party of the second part [lessee] to the

exclusive use of the name ‘Marie Antoi-

nette' for the purposes of said hotel,

5la

together with all the personal property

therein contained, an inventory of which

is to be hereto annexed signed by the

parties hereto, with the appurtenances,

for the term of 21 years from the lst day

of October, 1902."

Among other provisions, this lease

contained the following:

"It is hereby agreed between the par-

ties hereto that connections may be made

between the said premises and the adjoin-

ing building to be erected on the north

thereof in such locations as the said

party of the second part [lessee] may deem

desirable, but on plans submitted to the

parties of the first part by the party of

the second part and approved by them;

provided, however, and it is hereby agreed,

that the above leased premises shall be

restored to their original condition by

and at the expense of the party of the

52a

second part at the expiration or earlier

termination of this lease or a renewal

thereof.

"It is further agreed by and between

the parties hereto at the termination of

this lease or any renewals thereof which

may be agreed upon that the name ‘Marie

Antoinette’ and the right to use the same

shall revertto and become the sole pro-

perty of the parties of the first part

{lessors], their successors or assigns

kkk

"And the said party of the second part

[lessee] further covenants and agrees to

use said premises for the purposes of a

first-class hotel and for no other pur-

pose."

By another instrumwnt in writing, bear-

the same date as this lease, executed by

the trustees and Flanagan, as parties of

the first part and said Albert R. Keen,

53a

as party of the second part, it was pro-

vided as follows:

"WHEREAS, as an inducement to the par-

ties of the first part to make and enter

into said lease with the party of the

second part, the said party of the second

part hereby agrees to procure a lease of

premises adjoining the demised premises

on the north [67th Street premises], upon

which a twelve-story hotel is to be

erected, which said lease, together with

the lease of the hotel Marie Antoinette

are to be assigned to a company or cor-

poration to be organized by the said

party of the second part on or before

October lst, 1902, ***

"NOW, THEREFORE, for an in considera-

tion of one dollar *** the parties of

the first part hereby consent to the

assignment of the lease of said hotel

Marie Antoinette by the party of the

54a

second part to the said corporation so to

be formed.

"The said party of the second part

hereby agrers to organize and incorporate

said corporation on or before October lst

1902, and to assign the lease of said

hotel Marie Antoinette, together with the

lease of the aforesaid adjacent premises

to said corporation.

"The party of the second part further

agrees that upon the organization of said

corporation, he will procure said corpo-

ration to accept assignments of said

leases, and to assume and agree to pay

the rents reserved therein and to keep

and perform all the covenants therein

contained, and contained in this agree-

ment." (Brackets ours.)

Mr. Keen complied with the provisions

of this agreement and obtained a lease

for twenty-one years of the Sixty~-seventh

55a

street premises, which, on March 4, 1902,

he assigned to the defendant herein,

Marie Antoinette Hotel Company. To this

company he also assigned the lease of

"Hotel Marie Antoinette" (the Sixty-

sixth street premises) by an assignment

jointly executed by Keen and the defend-

ant. By such instrument the defendant

does “assume and agree to perform, ful-

fill and carry out the agreements, cove-

nants, conditions and provisions which in

the said ‘indenture of lease are by the

said Albert R. Keen agreed to be per-

formed."

It is, therefore, apparent that when

the lease was made, defendant's assignor,

and thereafter defendant, had notice and

expressly agreed that their right to use

the name "Marie Antoinette" would cease

and terminate at the end of such lease.

From and after October 1, 1902, the

56a

defendant hotel company managed and ope-

rated the "Marie Antoinette Hotel", es-

tablished at Sixty-sixth street and

Broadway. About April 15, 1903, a

twelve-story hotel building having been

erected on the Sixty-seventh street pre-

mises, adjoining the "Marie Antoinette

Hotel," connections were made between

the two structures and the new building

was advertised and announced as "the new

addition to Hotel Marie Antoinette."

The two buildings were jointly opera-

ted by the defendant as the "Marie An-

toinette Hotel" until October 1, 1923,

when the lease covering the orignal "Marie

Antoinette Hotel" premises expired, and

was not renewed.

Since October 1, 1923, the defendant

corporation has continued operating an

hotel in the structure at Sixty-seventh

street and Broadway, and in connection

57a

therewith is using the name "Hotel Marie

Antoinette." An «<lectric sign, about

six feet high by thirty feet long illu-

minated at night and displaying the name

"Hotel Marie Antoinette," has been main-

tained on the roof of the defendant's

Sixty-seventh street building. The

defendant has distributed and used sta-

tionery designating such premises as the

"Hotel Marie Antoinette." Defendant has

caused the name "Hotel Marie Antoinette"

with the address of its premises, to ap-

pear in the telephone book. The station-

ery used by defendant after October l,

1923, contained pictures purporting to

show that its hotel covers the entire

Broadway block between Sixty-sixth and

Sixty-seventh streets. Confusion has

necessarily resulted in the delivery of

mail and prospective guests and others

have been mistaken as to which of the two

58a

buildings is the Hotel Marie Antoinette.

The plaintiffs Stogop Realty Co., Inc,

and Aloumor Realty Corporation are the

owners in fee of the Sixty-sixth street

premises, each owning an undivided one-

half thereof, and claim to be possessed

of all the right, title and interest of

William L. Flanagan, the original owner,

by reason of certain conveyances to them

hereinafter described, the lease of

February 19, 1902, and the undisputed

facts in evidence, and in consequerre to

have the exclusive right to the use of

the name Hotel Marie Antoinette. By this

action they seek permanent injunction

against the use by defendant of such name

or any simulation “hereof in connection

with an hotel.

William L. Flanagan upon his death,

on January 18, 1903, left a will which

was duly probated, in which he devised

59a

one-half of his property to his son,

William L. Flanagan, Jr., and the other

one-half thereof to trustees named in his

will. By mesne conveyances, which we

deem unnecessary to enumerate, an undivi-

ded one-half of theSixty-sixth street

premises was eventually conveyed to the

plaintiff Stogop Realty Co., Inc., by a

conveyance dated January 25, 1921, and

the other undivided one-half of said

premises was eventually conveyed to the

plaintiff Aloumor Realty Corporation by a

conveyance dated April 11, 1921, since

which respective dates these plaintiffs

have been the owners in fee cf such pre-

mises. To them the defendant Marie Antoi-

nette Hotel Company thereafter paid the

rent reserved under the lease dated Feb-

ruary 19, 1902, until its expiration on

October 1, 1923. The Aloumor Realty Cor-

poration also obtained an assignment to it

60a

of the said lease of February 19, 1902.

As the property had been conveyed with

the appurtenances,without reservation,

even without such formal assignment of

lease, the deed effectually transferred

all the grantor's rights in and under the

unexpired lease. (Real Prop. Law, §223;

Proctor Troy Properties Co. v. Dugan Store,

191 App.Div. 685).

The deedsof conveyance in the chains

of title to the said plaintiffs convey

the Sixty-sixth street premises by metes

and bounds and do not specifically de-

scribe the premises as the "Hotel Marie

Antoinette," nor do any of said deeds by

specific words grant or convey the right

to the use of the name "Hotel Marie An-

toinette." Each of said deeds in the

chains of title, however, has the statu-

tory phrase: "Together with the appurte-

nances and all the estates and rights of

6la

the party of the first part [grantors} in

and to said premises."

The plaintiff Marie Antoinette Realty

Company, Inc., is a New York corporation,

incorporated February 9, 1923, and at the

commencement of this suit November 13,

1923, was in possession of the Sixty-sixth

street premises as lessee under a lease

for a term of twenty-one years commencing

October 1, 1923. This was a lease made

by the plaintiff owners dated February 5,

1923, to one Morris Tobias, and Tobias

thereafter assigned this lease to the

plaintiff Marie Antoinette Realty Company,

which corporation took possession of the

demised premises on October 1, 1923, when

the lease to the defendant hotel company

expired. On or about December 15, 1923,

and prior to the close of the trial herein

the plaintiff realty company, as lessee,

was dispossessed and accordingly has no

62a

further interest in this suit.

This twenty-one-year lease to Tobias,

date@ February 5, 1923, leased the pre-

mises at the northwest corner of Sixty-

sixth street and Broadway, being known as

the Hotel Marie Antoinette, to be used

and occupied as an apartment hotel and

for business or stores on the ground ~

floor, together with the right, if any,

of the landlords, to the exclusive use of

the name "Marie Antoinette” in connection ,

with the use of said premises.

The Tobias lease further provided:

"Tenant agrees that on or before September

30, 1924, he will at his own proper cost

and expense in a good and workmanlike

manner, and in accordance with plans and

specifications, make and complete all

such alterations, additions and improve-

ments to the building now erected upon

the demised premises as shall be approp-

63a

riate to change and alter the building

into a business and apartment hotel,

which shall contain stores on the ground

floor and one, two and three room apart-

ments, each apartment with a bath, on

each of the other floors throughout the

building."

With the permission of the then owners

of the Sixty-sixth street premises, shortly after

1903, the heating and power plant, the

kitchen and dining room and other inci-

dental hotel equipment had been removed

from the Sixty-sixth street premises,

and the ground or street floor had been

altered for store use, leaving the upper

floors of the Sixty-sixth street premises

divided into apartments for guests, and

prior to October 1, 1923, the date of the

expiration of the Keen lease, the furni-

ture, furnishings and certain other per-

sonal equipment located in the Sixty-sixth

64a

street premises had been sold by the

Flanagan interests by formal bills of

sale to the defendant hotel company.

Immediately after October 1, 1923,the

plaintiffs herein, as owners of the Sixty

sixth street premises, proceeded with al-

terations and repairs in order to make

the Sixty-sixth street premises an hotel

complete in itself, and divided it into

suites of rooms, and advertised it in the

newspapers as an apartment hotel under

the name of the Marie Antoinette Hotel.

The plaintiffs claim that Mr. Flanagan

as the owner of the premises, by his acts

appropriated and established the name

"Hotel Marie Antoinette" for the hotel

premises at the southwest corner of Sixty

sixth street and Broadway; that the lease

of February 19, 1902, specifically grants

to the lessee the right or license to use

the name "Marie Antoinette," in connec-

65a

tion with the hotel business merely for

the term of twenty-one years. Further,

that they are the successors by duly exe-

cuted deeds of conveyance, of all the

right, title and interest of William L.

Flanagan in the said Sixty-sixth street

premises, and that such right, title and

interest includes the use of the name

"Marie Antoinette Hotel" exclusively in

connection with such premises.

This building was specially constructed

by Mr. Flanagan for use as an hotel. Be-

fore its completion he selected and ap-

propriated for it the name "Hotel Marie

Antoinette." For eight years from its

completion Mr. Flanagan operated the

premises as the “Hotel Marie Antoinette"

and during that period it was the only

hotel premises conducted under that name

in the city of New York. It is our opin-

ion that the name "Marie Antoinette"

66a

thereby became appurtenant to and insepa-

rably connected with the said premises,

was a valuable property right and in-

terest, formed an element in the value

of the hotel premises in the nature of a

trade-mark and belonged to the owner of

the premises.

It has been decided that the name es-~-

tablished for a hotel is a trade-mark in

which the proprietor has a valuable inte-

rest which a court will protect. (Howard

v. Henriques, 5 N.Y. Super. Ct. [3 Sandf]

725; Martell v. St. Francis Hotel Co., 5l

Wash. 375; O'Grady v. McDonald, 72 N.J.

Eq. 805; Busch v. Gross, 71 id. 508;

Mitchell v. Read, 19 Hun, 418; Marsh v.

Billings, 7 Cush. 322; McCardel v. Peck,

28 How. Pr. 120; Mark kealty Corporation

v. Hirsch, 180 App.Div. 549.)

In Mark Realty Corporation v. Hirsch

(supra. 554) Mr. Justice Dowling stated:

67a

"A party will be protected in the use of

a name which he has appropriated and ren-

dered valuable, and this rule is not

limited to its use as a designation of

manufactured goods, but has been applied

to the title of a hotel."

When Mr. Flanagan died on January 18,

1903, all his right, title and interest

in and to the Sixty-sixth street premises

became part of his estate and eventually

passed by deeds of conveyance to the

plaintiffs herein, who secured title in

the year 1921, over two years before the

expiration of the said lease.

The defendant contends that the deeds

of conveyance to these plaintiffs are

wholly insufficient to convey the use of

the name "Hotel Marie Antoinette," in-

sisting that this is a name not appurte-

nant to or part and parcel of the hotel

premises at Sixty-sixth street and Broad-

68a

way, but a name attached to the hotel

business as distinct from the hotel

building itself, the transfer of which

would require specific language indicat-

ing the transfer and conveyance of such

rights to the use of the name, and that

such transfer or conveyance is not af-

fected by the statutory language contained

in the deeds to these plaintiffs, namely:

"Together with the appurtenances and all

the estates and rights of the party of

the first part in and to said premises."

The scope and meaning of this statutory

language is defined in section 255 of the

Real Property Law, which reads as follows:

"In any grant or mortgage of freehold in-

terests in real estate, the words, 'toge-

ther with the appurtenances and all the

estate and rights of the grantor in and

to said premises,' must be construed as

meaning, together with all and singular

69a

the tenements, hereditaments and appur-

tenances thereunto belonging, or in any

wise appertaining, and the reversion and

reversions, remainder and remainders,

rents, issues and profits thereof, and

also all the estate, right, title, inte-

rest, dower and right of dower, curtesy

and right of curtesy, property, posses-

sion, claim and demand whatsoever, both

in law and in equity, of the said grantor

of, in and to the said granted premises

and every part and parcel thereof, with

the appurtenances."

The conveyances in question were the

transfer and sale of a business site were

absolute and unqualified and granted all

the right, title and interest of the

grantors, successors in title of William

L. Flanagan, the original owner. There

was no provision in these deeds that the

premises purchased should not thereafter

70a

be used by the purchaser for the purposes

of an hotel or that the premises should

not be called by their old name. These

conveyances place these plaintiffs in the

same position and situation as would Mr.

William L. Flanagan himself have been had

he been alive on October 1, 1923, the

date of the expiration of the said lease.

The proposition of the defendant is that,

nevertheless, there still remains vested

in the seller an exclusive right to the

name, transferable by him as a separate

right, and available to the transferee as

against the purchaser of the premises and

all the world.

It is our opinion that the right to

use the name "Hotel Marie Antoinette"

was inseparably associated with the Sixty-

sixth street premises and passed as an

incident with the transfer of the fee of

such premises. (Mitchell v. Read, 19 Hun,

Jla

418; affd., 84 N.Y. 556.)

English and Scotch courts have con-

sidered this precise question and have

come to a like conclusion. We consider

them very persuasive precedent. (Mason v.

Queen, 23 Scot. L.R. 641; King v. Midland

R. Co., 17 W.R. 113; Chissum v. Dewes, 5

Russ. 29, 30; Ex parte Punnett, 50 L.J.

Ch. 212,214; Great North of Scotland R.

Co. v. Mann, 19 Sess. Cas. Sc. [4th Ser.

1891-92] 1035; Boussod, Valadon & Co. v.

Marchant, 25 Repts. of Patent Cases, 42

[English]; Llewellyn v. Rutherford, L.R.

10 C.P. 456, 467.)

In Nims on Unfair Competition and Trade

Marks (2d ed. §21),concerning the sale of

a hotel, the author states: "In such

cases he who buys the buildings, or ac-

quires the right to occupy them, will

have the right to use the name attaching

thereto, in the absence of very explicit

72a

contractual arrangement.”

In Hopkins on Trade Marks (4th ed.1924

in speaking of the good will of a hotel,

the author states at (p.228): “But when

we come to speak of the good will of a.

public house, it is obvious that it is a

thing which is attached to a locality. In

accordance with this rule, whenever the

good will is local, in the sense of being

attached to a particular house or store,

it will pass with a sale of the lease of

the trading premises, or the sale of a

public house."

The rule is also stated in Halsbury's

Laws of England (Vol. 27, p.755 §1336)as

follows: "Where a place of business is

sold, even without the good will, the

right to use the name of that place usu-

ally passes to the purchaser, particulary

if the name is carved on or affixed to

the building."

73a

The right of the defendant here to use

the name Marie Antoinette in connection

with any hotel business is measured by

the terms of the lease dated February 19,

1902. It was a mere temporary right or

license to use the name Marie Antoinette

for a definite period of time, namely,

during the term of twenty-one years spe-

cified in the lease. By the express

terms of this lease, at its expiration

on October 1, 1923, the right of the de-

fendant corporation to use the ‘sia Hotel

Marie Antoinette in connection with hotel

business ceased and reverted to the ownes

of the leased premises, who at that time

were these plaintiffs.

In Chittenden v. Witbeck (50 Mich.401),

which is cited with approval in People ex

rel. Johnson Co. v. Roberts (159 N.Y. 70,

81), it was held, Judge Cooley writing

the opinion: "Good-will is the favor

74a

which the management of a business wins

from the public, and the probability

that old customers will continue their

patronage. But it attaches to the pro-

perty, and in the case of a lease belongs

to the lessee only during its continu-

ance, and on its expiration reverts to

the lessor; and in fixing rent the lessor

can take it into the account as giving

the property a part of its value."

In Llewellyn v. Rutherford (L.R. 10

C.P. 456) Cnief Justice Lord Coleridge

stated (at p. 467): "Here is a public

house in which a thriving business has

been carried on, having attached to it

that which has been variously described

as good will, -- a thing which has an

appreciable value and is every day bought

and sold. That good will the tenant is

about to forego. In the absence of a

stipulation to the contrary, it would be

75a

and increased value of the premises,

which on the tenant's going away would

enure to the benefit of the landlord; he

might let them for an increased rent or

he might obtain a premium. In the ab-

sence of a stipulation, the tenant could °

derive no advantage from such increased

value. The end of the term having ar-

rived, all he could take away would be

the stock in trade and the tenant's fix-

tures. The good will is lost to him."

There is abundant evidence in the re-

cord that since October 1, 1923, the

present owners have proceeded to restore

the Sixty-sixth street premises, so that

the same could be operated independently

as an hotel. Immediately upon the ter-

mination of the Keen lease on October l,

1923, the plaintiffs inserted advertise-

ments in the daily papers stating that

the "Hotel Marie Antoinette" at Broadway

76a

and Sixty-sixth street, northwest corner,

offered one, two or three rooms and bath

furnished or unfurnished, on yearly lease,

with immediate possession.

The alterations required the construc-

tion of a new entrance on Broadway, al-

terations in the lobby and sitting room

and the installation of kitchens, dining

rooms, power and lighting plant, in other

words, the making of the Sixty-sixth

street premises into a complete, separate

hotel unit. Plans and specifications

covering these and other necessary chages

were filed in the proper municipal de-

partments. Under the Tobias lease the

lessors secured a surety company bond fer

$50,000 to insure the making of these

repairs and alterations, which through

no fault of the plaintiffs had not been

completed when the trial of this case

finished near the end of December, 1923.

77a

The fact remains that the plaintiffs were

proceeding with reasonable diligence to

make such alterations and repairs for the

purpose of using and renting the premises

as an hotel under the name "Hotel Marie

Antoinette." There is no merit in the

suggestion that the present owners aban-

doned the purpose of using these premises

as an hotel under such name. Nor does

the fact that the premises were to be di-

vided up into suites of one, two and three

rooms and baths, rather than into single

rooms, warrant the conclusion that they

were intended to be used and conducted by

the plaintiffs merely as an apartment

house, rather than as an hotel; there are

Many so-called apartment hotels in New

York City, properly designated as hotels

and not as apartment houses.

The plaintiffs in their complaint also

ask relief that the registration by de-

78a

fendant of the name "Marie Antoinette",

granted on defendant's application by the

Secretary of State of New York on July

17, 1923, be revoked and canceled. This

relief should be afforded to the plain-

tiffs.

The judgment appealed from should be

reversed, with costs, and judgment en-

tered in favor of the plaintiffs for the

relief asked for in the complaint, ex-

cept for an accounting of profits, with

wouee to the plaintiffs.

Clarke, P.J., Merrell and Finch, JJ,

concur; Martin, J., dissents.

Judgment reversed, with costs, and

judgment entered in favor of the plain-

tiffs for the relief asked for in the

complaint, except for an accounting of

profits, with costs to the plaintiffs.

Settle order on notice.

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