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Allied Maintenance Corp. v. Allied Mechanical Trades, Inc.

Court of Appeals of New York

September 8, 1977, Argued ; October 18, 1977, Decided

No Number in Original

Opinion

 [419]   [*541]  [**1163]  [***629]    We are called upon today to decide whether the trade name "Allied Maintenance" is entitled to protection pursuant to section 368-d of the General Business Law -- commonly referred to as the anti-dilution statute.

The plaintiff, Allied Maintenance Corporation, has been in business, in one form  [420]  or another, since 1888. Throughout the many years since its inception, Allied Maintenance has concentrated the scope of its services upon the cleaning and maintenance of large office buildings. The defendant, Allied Mechanical Trades, Inc., a corporation organized in 1968 as a successor to Controlled Weather Corporation, is engaged primarily in the installation and repair of heating, ventilating and air-conditioning equipment.

 [***630]  Alleging that the defendant performed maintenance services identical to those it performed, Allied Maintenance brought this action to enjoin Allied Mechanical from operating under [****8]  the name "Allied" or "Allied Mechanical Trades, Inc.", or using the word "Allied" in any way in connection with its business. The trial court granted the injunction, finding that the parties were actual and potential competitors in the cleaning and maintenance industry in the metropolitan New York City area and that the auditory and visual similarity between their names created a likelihood of confusion.  On this basis, the court concluded that defendant's use of the name Allied Mechanical would result in irreparable injury to plaintiff's reputation, good will, and proprietary business interests, and would thus constitute unfair competition. The Appellate Division reversed, however, finding an absence of either competition or confusion, actual or potential. The court concluded that "no user of the services of either party has been or may probably be confused or deceived by any similarity in the names of the parties." (55 AD2d 865, 866.)

] In addition to the protection of trade-marks and trade names afforded by the traditional actions for trade-mark infringement and unfair competition, New York, as  [**1164]  well as a number of other States, 1 has adopted an anti-dilution statute.  [****9]  (General Business Law, § 368-d.) This statute provides: "Likelihood  [*542]  of injury to business reputation or of dilution of the distinctive quality of a mark or trade name shall be a ground for injunctive relief in cases of infringement of a mark registered or not registered or in cases of unfair competition, notwithstanding the absence of competition between the parties or the absence of confusion as to the source of goods or services." (Emphasis added.) The purpose behind the enactment of this statute was the prevention of trade-mark or trade name dilution -- i.e., "the whittling away of an established trade-mark's selling power and value through its unauthorized use by others upon dissimilar products." (NY Legis Ann, 1954, p 49 [emphasis added].) In the absence of a statute of this nature, a plaintiff seeking to prohibit the use of a trade name by another would be required to frame his complaint within the strictures of an action for either trade-mark infringement or unfair competition. A brief review of the elements of these actions is useful in interpreting the legislative intent behind the enactment of section 368-d.

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42 N.Y.2d 538 *; 369 N.E.2d 1162 **; 399 N.Y.S.2d 628 ***; 1977 N.Y. LEXIS 2429 ****; 198 U.S.P.Q. (BNA) 418

Allied Maintenance Corporation, Appellant, v. Allied Mechanical Trades, Inc., Respondent

Prior History:  [****1]   Allied Maintenance Corp. v Allied Mechanical Trades, 55 AD2d 865.

Appeal from an order of the Appellate Division of the Supreme Court in the First Judicial Department, entered January 4, 1977, which (1) reversed, on the law and the facts, a judgment of the Supreme Court, entered in New York County upon a decision of the court at a Trial Term (Pelham St. George Bissell, 3rd, J.), granting an injunction against the use of the name "Allied" by defendant in its corporate title, (2) vacated said judgment, and (3) dismissed the complaint.

Disposition: Order affirmed, with costs.

CORE TERMS

trade-mark, trade name, Allied, dilution, unfair competition, infringement, anti-dilution, secondary meaning, products, competitors, injunction, entity, closely related, dissimilar, clothing, parties, courts, common law, reputation, literally, cleaning, cases

Trademark Law, Causes of Action Involving Trademarks, Infringement Actions, General Overview, Dilution of Famous Marks, Unfair Competition, Federal Unfair Competition Law, Remedies, Equitable Relief, Special Marks, Trade Names, Infringement Actions, Business & Corporate Compliance, Determinations, Likelihood of Confusion, Consumer Confusion, Confusion Among Noncompeting Products, Similarity of Marks, Appearance, Meaning & Sound, Eligibility for Trademark Protection, Distinctiveness, Particular Subject Matter, Names, State Antidilution Statutes, Subject Matter of Trademarks, Terms Requiring Secondary Meaning, Strength of Trademark