Moot Court Spring 1993

Moot Court

Tires Galore v. Tires Galore
Tom Field --- Spring 1993

District Court for the Western District of Massachusetts

Ira Scible, J.

This case was initiated by Tires Galore of Albany, NY (hereafter TGNY) against Tires Galore of Springfield, MA (hereafter TGMA) to enjoin TGMA's operating a retail tire store in Pittsfield, MA. Subsequently, TGNY opened its own store in Pittsfield, and TGMA filed a reciprocal action. Those actions have been joined, and both are addressed here.

I. Undisputed Facts      The products sold by both parties carry brands such as "Goodyear" or "Uniroyal." Hence, "Tires Galore" is a service mark, but here "trademark" or "mark" will be used for simplicity.
     Since 1985, TGNY has sold tires from a store in Albany, NY under the name, "Tires Galore." It has also advertised on TV and radio. Those ads reach an audience within a circle of about 60 mile radius, encompassing Pittsfield, MA (40 miles). Still, there is no evidence of any Pittsfield consumer ever going to Albany as a result. Prior to opening its second store in September 1992, TGNY's only sales in Pittsfield were to other retailers.
     In 1970, TGMA began as "Tires Galore" in Springfield, 40 miles from Pittsfield. By late 1991, it had spread in every direction except west and had twenty stores throughout New England. Although TGMA had also advertised, e.g., on Boston and Springfield TV and radio, the Berkshires blocked reception in Pittsfield. After opening its store in Pittsfield in February 1992, TGMA began advertising west of the Berkshires. Although it has not used Albany stations, many people between Albany and Pittsfield nevertheless have been receiving two sets of ads, and some have gone to the wrong store in search of advertised specials.
     TGNY filed its action in mid-March 1992, after it noticed TGMA's ads. Meanwhile, in early March, attempting to deal with the same problem, TGMA had already changed its name in the Pittsfield market. Shortly after TGNY filed its action, TGMA also registered its new Pittsfield name, "New England Tires Galore," as well as "Tires Galore," in the state of Massachusetts.
     Neither party has federal registration.

II. Jurisdiction Notwithstanding lack of federal registration, this court has jurisdiction under § 43(a) of the Lanham Act [15 U.S.C. § 1125(a)] and 28 U.S.C. § 1338. Any effect on interstate commerce required to support this action is amply met, given the interstate nature of this dispute.

III. The Rights of the Respective Parties      Generally, rights in non-descriptive and non-functional source indicators, other than surnames, are acquired in a given geographic area by the first to use them on particular products or services. See, e.g., Two Pesos, Inc. v. Taco Cabana, Inc. 112 S.Ct. 2753 (1992). Thus, TGMA's rights east of the Berkshires are clear. Moreover, even though it was the first to use "Tires Galore" anywhere, its failure to do so in Albany means that TGNY has unquestioned rights in that market.
     The first issue is who was the first to use "Tires Galore" in Pittsfield? TGNY maintains that it was by virtue of both sales and broadcast ads. However, the former is irrelevant; no consumer ever associated it with the product prior to its opening a store last September. The latter is a bit problematic in view of cases such as Western Stove Co. v. George Roper Corp., 82 F.Supp. 206 (S.Dist. CA 1949), but, in these circumstances, I find that TGNY has the right to exclude TGMA from using "Tires Galore" in areas previously covered by its broadcast ads. See, e.g., Premier Pabst Corp. v. Elm City Brewing Co., 9 F.Supp 754 (Dist. CT 1935). However, this does not dispose of the case because TGMA no longer sells under that name.
     The second issue is whether use by TGMA of the altered name in Pittsfield infringes TGNY's rights. I find not. The distance between Albany and Pittsfield, the relative weakness of the basic mark, the sophistication of tire buyers, the price of tires and other such factors has led to minimal confusion, and the situation should improve over time. Thus, I conclude that TGMA should not be enjoined from using the altered name in Pittsfield.
     The final question is, aside from its ability to prevent TGMA from doing so, whether TGNY can sell in Pittsfield as "Tires Galore." On balance, I conclude that the market will be poorly served by two different retailers serving exactly the same market under essentially the same name.
     The upshot is that TGNY cannot continue operating as "Tires Galore" in Pittsfield. Likewise, TGMA cannot expand under its altered name, much less under the original name, in the direction of Albany. This is not warranted on the present record, but should it show any inclination to do so, I will not hesitate to issue an injunction. Also, TGMA cannot advertise on media likely to penetrate TGNY's primary market area

IV. Remedy Respective counsel may submit proposed final orders within 15 days. If required to resolve differences, a hearing will be scheduled shortly thereafter. Meanwhile, TGNY is ordered to cease selling as "Tires Galore" in Pittsfield and TGMA is ordered to cease advertising on media that penetrates TGNY's Albany market.

The Appeal      Both parties have filed timely notice of appeal.
     TGMA urges that the district court erred in finding TGNY to be the first user of "Tires Galore" in Pittsfield. It also urges that its being essentially ordered neither to use its original name west of the Berkshires nor to expand under its altered name in the direction of Albany was improper. Finally, it urges that its being essentially enjoined from all broadcast advertising west of the Berkshires is in error.
     TGNY urges that enjoining its use of "Tires Galore" in Pittsfield is inconsistent with the court's finding that it was the first user in that market. Moreover, it urges that the lower court erred in permitting TGMA to use the altered name in Pittsfield. However, of course, it believes that the court was correct in enjoining TGMA from advertising as "Tires Galore" or "New England Tires Galore" in its market areas.

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