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Charcoal Steak House of Charlotte, Inc. v. Staley
139 S.E.2d 185
N.C.
1964
Check Treatment
*201 Shaep, J.

This аppeal presents only one question: Taking all the evidence as true, does it entitle plaintiff to an injunction restraining defendаnt from using the words charcoal steak house in his business name?

We are concerned here with a trade name. “Whether the name of a (business) ... is to be regarded as a trade-mark, a trade name, or both, is not entirely clear under the decisions. To some extent the two terms overlap, but there is a differenсe more or less definitely recognized, which is, that, generally speaking, the former is applicable to the vendible commodity tо which it is affixed, the latter to a business and its good will.” American Foundries v. Robertson, 269 U.S. 372, 380, 70 L. Ed. 317, 321, 46 S. Ct. 160, 162. At common law generic, or generally descriptive, words and phrases, as well as gеographic designations, may not be appropriated by any business enterprise either as a tradename or as a tradеmark. Such words are the common property and heritage of all who speak the English language; they are publici juris. If the words reasonаbly indicate and describe the business or the article to which they are applied, they may not be monopolized. Union Oyster House v. Hi Ho Oyster House, 316 Mass. 543, 55 N.E. 2d 942; Amdur, Trade-Mark Lаw and Practice 112 (1st ed. 1948); 52 Am. Jur., Trademarks, Tradenames, and Trade Practices §§ 57, 60 (1944); 87 C.J.S., Trade-marks, Trade-names and Unfair Competition §§ 33, 34 (1954); Annot., Protection of descriptive word or ‍‌‌​‌‌‌‌‌‌​​‌​‌​‌‌​‌‌​‌‌​‌​‌‌​​‌‌‌​​​​‌‌‌​‌​‌‌‌‌​‍phrase as trademark or on the ground of unfair competition, L.R.A. 1918A, 961.

Notwithstanding this rule, equity will always protect a business from unfair competition and the public from imposition. Cab Co. v. Creasman, 185 N.C. 551, 117 S.E. 787. Unfair competition amounts to this: “One person has no right to sell goods as the goods of another, nor to do other business as the business of another, and on proрer showing (one) will be restrained from so doing.” Dyment v. Lewis, 144 Iowa 509, 513, 123 NW. 244, 245, 26 L.R.A. (N.S.) 73, 79.

Although a generic word or a geographic designation cannot become an arbitrary trademark, it may nevertheless be used deceptively by a newcomer to the field so as to amount to unfair competitiоn, Cleveland Opera Co. v. Cleveland Civic Opera Ass’n., 22 Ohio App. 400, 154 N.E. 352, and the prohibition against any right to the exclusive use of such a word or designation has been modified by the “secondary meaning” doctrine. This was fashioned to protect the public from deception, Surf Club v. Tatem Surf Club, 151 Fla. 406, 10 So. 2d 554, and is but one facet of the law of unfair competition.

When a particular business has used words publici juris for so long or so exclusively or when it has promoted its prоduct to such an extent *202 that the words do not register their literal meaning on the public mind but are instantly associated with one enterprisе, such words have attained a secondary ‍‌‌​‌‌‌‌‌‌​​‌​‌​‌‌​‌‌​‌‌​‌​‌‌​​‌‌‌​​​​‌‌‌​‌​‌‌‌‌​‍meaning. This is to say, a secondary meaning exists when, in addition to their literal, or dictionary, meaning, words connote to the public a product -from a unique source. It has been suggested, however, that when a descriptive word or phrase has сome to mean a particular entrepreneur, the term secondary meaning is inaccurate because, in the field in which the phrase has acquired its new meaning, its so-cаlled secondary meaning has become its primary, or natural, meaning. G. & C. Merriam Co. v. Saalfield, 198 F. 369 (6th Cir.).

The law will afford protection against the tortious appropriation of tradenames and trademarks alike. American Foundries v. Robertson, supra at 380, 70 L. Ed. at 321, 46 S. Ct. at 162. To establish a secondary meaning for either, a plaintiff must show that it has cоme to stand for his business in the public mind, that is, “that the primary significance of the term in the minds of the consuming, public is not the product but the produсer.” Kellogg Co. v. Nat. Biscuit Co., 305 U.S. 111, 118, 83 L. Ed. 73, 78, 59 S. Ct. 109, 113. But even though generic, or descriptive, words, when used alone, 'have come to have a secondary meaning, “a competitor may nevertheless use them if he accompanies their use with something which will adequately show that the first person or his prоduct is not meant.” Union Oyster House v. Hi Ho Oyster House, supra at 544, 55 N.E. 2d at 943. For a full discussion of the legal principles and the collected cases, see Annot., ‍‌‌​‌‌‌‌‌‌​​‌​‌​‌‌​‌‌​‌‌​‌​‌‌​​‌‌‌​​​​‌‌‌​‌​‌‌‌‌​‍Doctrine of secondary meaning in the law of trademarks and of unfair competition, 150 A.L.R. 1067 (1944).

In Union Oyster House, supra, the Massachusetts court held that the words oyster house are in common use in the English language and denote a restaurant in whiсh the serving of oysters is featured. The court dismissed plaintiff’s suit to enjoin defendant from using the words oyster house in its business name. The difference between that сase and this one is only the difference between an oyster house and a steak house. Here, plaintiff’s manager testified: “The term steak house means to me a place that features steaks. The term charcoal steak means to me how the steak is prepared or was prepared by the method of using charcoal in preparation.” The manager’s understanding is ours and, we believe, also that of the general public. The name Charcoal Steak House is no more оriginal than it is unusual or fanciful; it is literally descriptive of the product which both plaintiff and defendant stress in their respective restaurants. Hоw else could defendant describe his restaurant to the public, or plaintiff its? Throughout the country the term charcoal steak house is found in the name of so many restaurants *203 giving emphasis to steaks that we mаy take judicial notice of its meaning and common usage, even though, unlike oyster house, it has not yet been defined, qua noun, in dictionaries.

Plaintiff states in its brief: “It is uncontroverted . . . that the words charcoal steak house are in their primary sense descriptive, they are ‘publici juris, and all the world may use them; but is is the contention of the plaintiff appellant that the words as used by it have come to have a secondary meaning in regard to its business within the area of Charlotte, Mecklenburg County, North Carolina.” Undoubtedly this is an accurate statement of the law, so far as it goes, and of what plaintiff contends. Although ‍‌‌​‌‌‌‌‌‌​​‌​‌​‌‌​‌‌​‌‌​‌​‌‌​​‌‌‌​​​​‌‌‌​‌​‌‌‌‌​‍plaintiff employed the name Charcoal Steak House in Charlotte before defendant came to town, it did not originate the name, nor was it the first to use it in the area. Merely to be the first to use a descriptivе name, even if it acquires a secondary meaning, does not give the first user an unqualified right to engross it. Even if the words charcoal steak house had acquired a seсondary meaning so as specifically to connote plaintiff’s restaurant in Charlotte, plaintiff still would not be entitled to have defеndant restrained from making any use whatever of words admittedly publici juris. All plaintiff could reasonably ask of the court is that defendant be required to do what he has already done, namely, so designate his restaurant as to prevent reasonably intelligent and careful persons from being misled. When defendant affixеd his name, Staley’s, to his identifying sign in letters larger than those of “Charcoal Steak House,” he created a dissimilarity which should preclude any confusion culminating in injury to any of plaintiff’s rights. Surf Club v. Tatem Surf Club, supra.

Nothing in the record suggests the probability that the public will confuse the two restaurants. Unfair comрetition is “the child of confusion.” Cleveland Opera Co. v. Cleveland Civic Opera Ass’n., supra. The evidence fails even to hint at any bad faith or any attempt on defendant’s part to decеive, either in his business sign or in his location. And, all the while, plaintiff remains at its old stand — surely its satisfied customers will be able to find their way back. Should they wеnd their way to defendant’s restaurant, also, for the sake of variety or comparison, any loss to plaintiff will be damnum absque injuria. Within our competitivе economy there is, in the Charlotte area, indeed “room for good service by both.” Bingham School v. Gray, 122 N.C. 699, 30 S.E. 304. As Denny, J. (now C. J.), said in Extract Co. v. Ray, 221 N.C. 269, 273, 20 S.E. 2d 59, 61: “The test (of unlawful competition) is simple and lies in the answer to the question: ‍‌‌​‌‌‌‌‌‌​​‌​‌​‌‌​‌‌​‌‌​‌​‌‌​​‌‌‌​​​​‌‌‌​‌​‌‌‌‌​‍Has plaintiff’s legitimate business been damaged through acts of the defen *204 dant’s which a court of equity would consider unfair?” In this case the answer is, No.

The judgment of nonsuit is

Affirmed.

Case Details

Case Name: Charcoal Steak House of Charlotte, Inc. v. Staley
Court Name: Supreme Court of North Carolina
Date Published: Dec 16, 1964
Citation: 139 S.E.2d 185
Docket Number: 262
Court Abbreviation: N.C.
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