The plaintiff, Jack Daniel Distillery, Lem Motlow, Prop., Inc., brings this action against Hoffman Distilling Company alleging unfair competition and trademark infringement and seeks to enjoin the intervening defendant, Frank Silverman and Company, a co-partnership doing business as Ezra Brooks Distilling Company, from continuing to imitate its methods of advertising and packaging Jack Daniel's Black Label whiskey.
The evidence shows that the Jack Daniel Distillery was founded in 1866 and remained in the family of the founder until sold to Brown-Forman Distillers Corporation in 1956. It is the only legal distillery in Tennessee and its product is officially recognized by the Alcohol and Tobacco Tax Unit of the Federal Government as one of the four distinct types of whiskey manufactured in the United States, being designated as Tennessee sour mash whiskey as distinguished from bourbon whiskey, scotch whiskey and rye whiskey. The reason for this distinction is attributed to a process employed in the production of Jack Daniel's whiskey. After Jack Daniel's whiskey has been distilled, but before it is put in barrels, it is poured into large vats at the bottom of which there is from eight to ten feet of finely ground, tightly packed, sugar maple charcoal. It requires from eight to ten days from the time the whiskey is placed in these vats until it finally seeps through the charcoal. It is claimed that this process removes impurities and mellows and makes the finished product more palatable. In any event it is generally recognized that Jack Daniel's whiskey has a distinctive taste, and with one minor exception it is also known as the most expensive sour mash whiskey sold.
The Jack Daniel Distillery started as a small distillery in a small town in Tennessee. In 1952, however, national advertising was undertaken and by 1958 approximately 3½ million dollars had been expended in the promotion of its product. Its sales increased by more than 900% in the six-year period ending in 1956, as a result of which Jack Daniel's whiskey became in short supply and it was necessary to place it on allocation limiting wholesale distributors to various percentages of whiskey they had purchased in former years. In April 1957, about a year after Jack Daniel's whiskey became in short supply and had advertised this fact, a whiskey with the brand name of Ezra Brooks was placed on the market for the first time by the intervening defendant. It is this brand that plaintiff alleges unfairly competes in the same market with its brand Jack Daniel's Black Label.
It appears from the evidence that while the intervening defendant does business as the Ezra Brooks Distilling Company, this partnership does not own or operate a distillery. The whiskey that is distributed under its brand is bottled at the Hoffman Distilling Company, a small Kentucky distillery which is a defendant in this action, and some of the whiskey bottled under the brand name Ezra Brooks is produced by the Hoffman Distilling Company. The rest of the whiskey so marketed is the product of other distilleries manufacturing sour mash bourbon whiskey and is purchased in the open market by the intervening defendant.
Although the brand names Jack Daniel's and Ezra Brooks and the names of the Jack Daniel Distillery and the Ezra Brooks Distilling Company appear prominently on their respective labels, it is clear that many features of the Jack Daniel's package and methods of advertising are imitated by Ezra Brooks. Jack Daniel's uses a square bottle and a black and white wrap-around label. Ezra Brooks employs a square bottle and a black and white wrap-around label. Jack Daniel's on its label uses the words, "90 Proof by Choice." Ezra Brooks on its label employs the expression "90 Proof for Character." Jack Daniel's pictures a small old-time distillery on its label and Ezra Brooks' label follows suit. Jack Daniel's for many years advertised that its whiskey is "Rare Old Sippin' Whiskey" and otherwise uses the word "Sippin'" to describe its product. Ezra
From this brief statement of the evidence it is necessarily concluded that all of these similarities were not adopted by accident but that the defendant intentionally copied and imitated the appearance of the well-established and attractive Jack Daniel's Black Label package and advertising techniques for its new and unknown brand Ezra Brooks. The obvious purpose of the copying was to solicit customers of the plaintiff who could not obtain Jack Daniel's whiskey while there was a shortage in supply and also to appeal to all other prospective consumers who would be attracted by the advertising and packaging methods developed by the plaintiff. It is the continuance of these imitating tactics that the plaintiff seeks to enjoin, but regardless of how disapproving the courts may be of such practices, they cannot legislate the morals of the market place. To sustain its claim for relief the plaintiff must establish by a preponderance of the evidence that the defendant is not merely competing with the plaintiff but is guilty of unfair competition such as is prohibited by law.
The defendant takes the position that even if it should be found it has imitated the Jack Daniel's Black Label package and advertising methods that such imitations fall far short of actionable unfair competition. It claims that the plaintiff has failed to establish that the purchasing public has been deceived or confused by the similarities of the two brands and asserts that no likelihood of confusion exists because of the obvious differences in the packages and because the two brands are clearly marked both by brand name and by source of manufacture.
The law of unfair competition to be applied to the facts of this case is concisely set forth in the Restatement of Torts, Sec. 741, under the title "Imitation of Appearance," pages 622 and 623.
In unfair competition the essence of the wrong is the sale of the goods of one manufacturer for those of another. Hanover Star Milling Co. v. Metcalf, 240 U.S. 403, 36 S.Ct. 357, 60 L.Ed. 713; Prestonettes, Inc. v. Coty, 264 U.S. 359, 44 S.Ct. 350, 68 L.Ed. 731; Howe Scale Co. of 1886 v. Wyckoff, Seamans & Benedict, 198 U.S. 118, 25 S.Ct. 609, 49 L.Ed. 972; Hemmeter Cigar Co. v. Congress Cigar Co., Inc., 6 Cir., 118 F.2d 64. Absent a monopoly right such as is conferred by ownership of a valid patent or trademark one has the right to copy a competitor's product even if he gets a free ride by reaping an advantage from his competitor's advertising, provided he does not deceive the public by passing off his product as that of his competitor. Swank, Inc. v. Anson, Inc., 1 Cir., 196 F.2d 330. As pointed out by Judge McAllister in West Point Mfg. Co. v. Detroit Stamping Co., 6 Cir., 222 F.2d 581, 591, certiorari denied 350 U.S. 840,
As stated above the two brands are clearly marked both by brand name and source of production. The Ezra Brooks label prominently carries the name "Ezra Brooks Rare Old Genuine Sour Mash Kentucky Straight Bourbon Whiskey" with the statement "Bottled by Ezra Brooks Distilling Co., Lawrenceburg, Anderson County, Ky." The Jack Daniel's Black Label is conspicuously marked "Jack Daniel's Old No. 7 Brand Quality Tennessee Sour Mash Whiskey" with the statement "Distilled and Bottled by Jack Daniel Distillery, Lem Motlow, Prop., Inc., Lynchburg, Tenn." With the brands so clearly identified there is no likelihood of confusion and an ordinary prudent purchaser interested in source could not be deceived and misled to believe that the Ezra Brooks brand was produced by the Jack Daniel Distillery. See Singer Mfg. Co. v. June Mfg. Co., 163 U.S. 169, 16 S.Ct. 1002, 41 L.Ed. 118; Kellogg Co. v. National Biscuit Co., 305 U.S. 111, 59 S.Ct. 109, 83 L.Ed. 73.
For the reasons stated plaintiff's claim of unfair competition cannot be upheld.
Plaintiff also seeks trademark protection of its expression "Rare Old Sippin' Whiskey" registered by the Commissioner of Patents in the Supplemental Register on March 15, 1955, under a Certificate of Registration No. 603,460 and under a new Certificate of Registration bearing the same number dated November 27, 1956. The proof discloses, however, that this trademark has been abandoned without intention to renew its use since the latter part of 1953 when the Alcohol and Tobacco Tax Unit prohibited the use of the words "Rare" and "Old" together unless the age of the whiskey was specified. Discontinuance of a trademark with intent not to resume its use for two consecutive years is an abandonment of the trademark. Sec. 45 of the Trademark Act of July 5, 1956 (The Lanham Act), 15 U.S.C.A. § 1127.
Defendant will tender appropriate judgment.
Sec. 741, Elements of Unprivileged Imitation
"One who markets goods, the physical appearance of which is a copy or imitation of the physical appearance of the goods of which another is the initial distributor, markets them with an unprivileged imitation, under the rule stated in Section 711 if his goods are of the same class as those of the other and are sold in a market in which the other's interest is protected, and
"(a) he copied or imitated the appearance after obtaining access to or procuring the goods, or their labels, wrappers, containers, styles or designs by improper means or on his promise not to copy or imitate them, [(a) is not applicable in this case] or
"(b) the copied or imitated feature has acquired generally in the market a special significance identifying the other's goods, and
"(i) the copy or imitation is likely to cause prospective purchasers to regard his goods as those of the other, and
"(ii) the copied or imitated feature is nonfunctional, or, if it is functional, he does not take reasonable steps to inform prospective purchasers that the goods which he markets are not those of the other."