Union Carbide Corp. v. Ever-Ready, Inc. - 531 F.2d 366 (7th Cir. 1976)

Rule:

In determining whether likelihood of confusion exists, courts consider such factors as the type of trademark in issue, the similarity of design, similarity of products, identity of retail outlets and purchasers, identity of advertising media utilized, defendant's intent, and actual confusion. Survey evidence is often used because it is easier to obtain than evidence of actual confusion. Products need not be in direct competition for infringement to exist. Of course, the more closely products are related the more likely sources may be confused. Nevertheless, the directness of competition is only one factor to be considered in determining likelihood of confusion.

Facts:

In 1898 Union Carbide Corporation’s predecessor, American Electrical Novelty & Manufacturing Company, adopted the term EVER READY to distinguish its products. In 1901 the mark was changed to EVEREADY. In 1909 the company changed its name to American Ever Ready Company, and in 1914 it assigned all its assets to the National Carbon Company, Union Carbide's predecessor. Currently Union Carbide sells under its trademark, EVEREADY, alone or in combination with other words and designs, an extensive line of electric batteries, flashlights, and miniature bulbs for automobile and marine use. Carbide presently is the owner of five United States trademark registrations on its trademark, EVEREADY, alone, and with other words and distinctive designs. Affidavits have been filed pursuant to 15 U.S.C. §§ 1058 (for continued validity) and 1065 (for incontestability). Carbide has advertised these products extensively and since 1966 has had sales of its EVEREADY products in excess of one hundred million dollars per year. From October 1965 through July 1967 Carbide sold certain bulbs under its EVEREADY mark in blister packages which indicated that they were for high-intensity reading lamps. Carbide has continued to sell identical bulbs packaged for automotive and other uses. In 1944, Ever-Ready Fluorescent Company began importing miniature lamp bulbs for high intensity lamps, selling them in blister packages containing the term Ever-Ready. Union Carbide sued, alleging trademark infringement and unfair competition, and sought to enjoin Ever-Ready Fluorescent Company from using the term Ever-Ready in connection with the advertising or sale of electrical products. The district court found no infringement, no dilution under Illinois law, no unfair competition, and declared Union Carbide’s mark invalid. Union Carbide appealed. 

Issue:

Did the district court err in finding that Ever-Ready’s use of Ever-Ready on electrical products was not likely to cause confusion?

Answer:

Yes.

Conclusion:

The court reversed, holding that the trademark was valid, Union Carbide established incontestability of his trademark under 15 U.S.C.S. § 1065, and Ever-Ready Fluorescent Company failed to show any of the first six enumerated defenses required to overcome incontestability under 15 U.S.C.S. § 1115(b). The court further held that the similarity of marks, evidence of actual consumer confusion, and consumer surveys showed a substantial likelihood of confusion. In determining whether likelihood of confusion exists, courts consider such factors as the type of trademark in issue, the similarity of design, similarity of products, identity of retail outlets and purchasers, identity of advertising media utilized, defendant's intent, and actual confusion. Survey evidence is often used because it is easier to obtain than evidence of actual confusion. Products need not be in direct competition for infringement to exist. Of course, the more closely products are related the more likely sources may be confused. Nevertheless, the directness of competition is only one factor to be considered in determining likelihood of confusion. Lastly, the defense of laches is not supported by the evidence.