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UPJOHN CO. v. CHARLES LABS

December 14, 1967

The UPJOHN COMPANY, Plaintiff,
v.
CHARLES LABS, INC., Defendant



The opinion of the court was delivered by: TENNEY

Plaintiff, a drug manufacturer, has instituted suit under the Feld-Crawford Act (New York General Business Law, McKinney's Consol.Laws, c. 20, §§ 369-a, 369-b) to enjoin defendant, a retail druggist, from selling plaintiff's trademarked products at prices less than those stipulated in plaintiff's fair trade contracts.

Plaintiff seeks only an injunction.

I find the facts to be as follows:

 1. Plaintiff is a corporation organized and existing under the laws of the State of Delaware, licensed to do business within the State of New York, and maintains an office within this district.

 2. Defendant is a corporation organized and existing under the laws of the State of New York, having its principal place of business within this district, specifically at 62 East 14th Street, City, County and State of New York.

 3. Plaintiff is engaged in the manufacture, production, sale and distribution of pharmaceutical drugs, medicines and other commodities.

 4. Plaintiff is considered a full-line drug house in that 20 per cent of its line are now prescription or over-the-counter items, the remainder being distributed evenly between antibiotics, steroids or hormones, and anti-diabetic drugs.

 5. Each product manufactured and sold by plaintiff bears the trademark 'Upjohn' and product marks such as 'Unicap', 'Zymacap', 'Cheracol' and 'Kaopectate', all of which are affixed to the packages and cartons in which such products are packaged.

 6. Plaintiff's products bearing its trademarks are in free and open competition with like products of other pharmaceutical manufacturers, such as Parke, Davis & Co., Mead Johnson & Co., and E. R. Squibb, Division of Olin Mathieson Chemical Co.

 7. During the past several years, plaintiff has expended on the average of $ 3,000,000.00 per year (6-7 per cent of which has been exclusively allocated to the New York area) for its extensive and continuous program of advertising in medical and other professional journals, in lay magazines and, more recently, on television.

 8. Plaintiff's products enjoy a good reputation in the trade, and it has built up valuable good will with doctors, dentists, pharmacists, hospital and industrial accounts, as well as with consumers.

 9. Annual sales of the plaintiff for the entire country approximated $ 200,000,000.00 in each of the past several years.

 10. Plaintiff sells its products to wholesale druggists, retail druggists, hospitals, veterinary hospitals, physicians and industrial clinics.

 11. Defendant operates a drugstore at 62 East 14th Street, New York City, in which it sells at retail products purchased directly from plaintiff and those of other drug and pharmaceutical manufacturers.

 12. Plaintiff has entered into uniform fair trade contracts with retailers in the State of New York under which it has established minimum prices for the retail sale of products bearing its name and trademarks, which products may be sold over the counter ...


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