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November 3, 1993


The opinion of the court was delivered by: RAYMOND J. DEARIE

 DEARIE, District Judge.

 In this action, the defendant seeks summary judgment dismissing plaintiff's federal and state antitrust claims and related state common law claims of restraint of trade and unfair competition. For the following reasons, the defendant's motion is denied.


 This lawsuit is the latest skirmish in a 40 year battle between competing trademarks, LYSOL and PINE-SOL. The defendant, Sterling Winthrop ("Sterling"), manufactures and distributes household cleaning and disinfectant products under the trade name LYSOL. The LYSOL trademark has been federally registered for disinfectants since 1906, and for cleaning products since the 1920's. Sterling's primary product using the LYSOL name is an aerosol spray disinfectant. *fn1"

 The establishment of the PINE-SOL trademark did not come easily. In the 1940's, Clorox Company ("Clorox")'s predecessor filed an application to register the trademark PINE-SOL for a liquid general household cleaner, disinfectant, and deodorant. Sterling opposed this registration in the U.S. Patent Office. On October 2, 1952, the Examiner in Chief sustained the Examiner of Interferences' finding of confusing similarity between the PINE-SOL mark and the LYSOL mark as used on the same or similar goods.

 According to Sterling, Clorox's predecessor continued to use the PINE-SOL mark despite the Examiner in Chief's decision. Sterling sued, and the parties eventually settled the dispute by agreement executed on May 3, 1956 ("1956 Agreement"). Then, in 1965, Sterling filed suit again against the then-owner of the PINE-SOL mark, American Cyanamid Company ("Cyanamid"), alleging trademark infringement arising from Cyanamid's marketing of a PINE-SOL disinfectant spray. In 1967, a settlement agreement ("1967 Agreement"), which superseded the 1956 Agreement, ended that suit.

 Paragraph 4(a)(i) of the 1967 Agreement specified that, "when the generic name or purpose of the product is set forth in labels or advertising or promotional material, the generic name 'cleaner' or the generic function 'cleans' will continue to be set forth first, i.e., before such terms as 'disinfectant' or 'disinfects' or the like." Paragraph 4(a)(ii) prohibited "a display of such generic terms or functions as 'disinfectant' or 'disinfects' or the like in greater prominence than the generic name or function 'cleaner' or 'cleans,'" and Paragraph 4(a)(iii) further required that "more detailed labeling or advertising claims for the product in regard to its cleaning and disinfecting functions will be displayed in an analogous manner." (Paragraph 4(a)(i), (ii), (iii)).

 The 1967 Agreement also provided, at Paragraph 4(c), that:

In the display of the trademark PINE-SOL on all labels, packages, containers, other labeling, and advertising and promotional materials, separation must be maintained between the words or syllables 'Pine' and 'Sol' by placing between those words or syllables a device representing a pine or evergreen tree as presently used, and each of such words or syllables must begin with a capital letter with the remaining letters being small letters. It is understood, however, that the mark may appear in letters of the same size and a hyphen may be substituted for the small separation device representing a pine or evergreen tree in the text of labels or advertising material where the mark is not used in large type or otherwise displayed with prominence, but even then such words or syllables must always be used in separated form.

 (Paragraph 4(c)). Paragraph 5 repeated this requirement with respect to "all labels, packages, containers, other labeling, and advertising and promotional materials used in connection with the products permitted to be marketed by paragraphs 2(b), 3(a) and 3(b)" of the agreement. (Paragraph 5).

 Despite the elaborate specificity of the 1967 Agreement, disagreements persisted. In 1983, Cyanamid took the offensive and brought suit against Sterling alleging that Sterling had breached the 1967 Agreement by marketing LYSOL PINE ACTION. Although Sterling contends that Cyanamid alleged that the "use of the LYSOL trademark on a pine oil cleaning product constituted trademark infringement and unfair competition," (Def. 3(g) Statement), Clorox maintains that Cyanamid challenged the product because its "trade dress copied that of the Pine-Sol cleaner." (Pl. 3(g) Statement). *fn2" The parties eventually resolved this dispute and other pending disputes with yet another settlement agreement negotiated in 1987 ("1987 Agreement" or "Agreement").

 In the 1987 Agreement, Sterling gave considerable ground. Expanding upon the 1967 Agreement, the new agreement permitted new uses of the PINE-SOL mark. The 1987 Agreement provided that Cyanamid could use the PINE-SOL mark for a "multi-purpose pump spray household cleaner with disinfecting properties" (Paragraph 3(d)) as long as Cyanamid complied with certain conditions. These conditions included the requirement that the product "continue to be sold under a generic name indicating that it is a general purpose spray cleaner." (Paragraph 3(d)(ii)). For example, Paragraph 3(d)(ii) specified that, while the product could not be offered as a "special purpose cleaner, e.g., 'bathroom cleaner,'" it could be promoted "for particular uses, surfaces and areas, including new uses, surfaces and areas." (Paragraph 3(d)(ii)). In addition, the Agreement required that the PINE-SOL product not be offered "in more than one delivery form, formula, or scent in a single geographical area" at a given time. (Paragraph 3(d)(iv)).

 The 1987 Agreement permitted Cyanamid to use the PINE-SOL mark as part of an endorsement phrase to promote other disinfectant products under trademarks other than PINE-SOL. However, such use depended upon Cyanamid's compliance with an elaborate set of rules. For instance, the Agreement specified that the other trademark could not be used as part of the phrase that included the PINE-SOL mark, could not be likely to cause confusion with the trademark LYSOL or the trademark PINE-SOL, and had to "be, at least, capable of distinguishing the product on which it is to be used, i.e., eligible to be registered on the Supplemental Register, pursuant to Title 15, U.S.C., Section 1091, as presently worded." (Paragraph 2(e)(i)). In addition, the Agreement provided that "it must reasonably appear from the wording of said phrase that it was intended to convey only the meaning that the said disinfectant product originates with the company that has marketed 'PINE-SOL products." Accordingly, the Agreement noted that the phrases, "FROM PINE-SOL" and "FROM THE MAKERS OF PINE-SOL," would be "permissible," while "ANOTHER PINE-SOL PRODUCT" AND "CLEANS LIKE PINE-SOL" would not be permissible. (Paragraph 2(e)(ii)). The Agreement specified that PINE-SOL could be used "only once in the said phrase and must be preceded somewhere in said phrase by a word no shorter than 'FROM,'" (Paragraph 2(e)(iii)), and that "'PINE-SOL' in the said phrase shall never be displayed with 'PINE' above 'SOL', and 'PINE-SOL' must always appear on a single line." (Paragraph 2(e)(iv)).

 Further, at Paragraph 2(e)(xii), the Agreement provided that "no matter may appear on the said disinfectant product or in advertising or promotional material there for which states that the said disinfectant product is generally better than any named or displayed disinfectant product on which Cyanamid uses the trademark PINE-SOL." (Paragraph 2(e)(xii)). However, this provision did permit Cyanamid to "state in such materials that said disinfectant products are better than 'PINE-SOL' for a particular purpose, surface or area." (Paragraph 2(e)(xii)).

 The 1987 Agreement explicitly retained the requirement that the PINE-SOL product not be offered in more than one form, scent or formula in a single geographic area at a given time. (Paragraph 4(e)). The Agreement acknowledged Sterling's right to use LYSOL as a mark "in connection with cleaning, disinfecting, deodorizing, laundering and personal care products for home or institutional use, and services related thereto." (Paragraph 7(a)(i)). In addition, the Agreement permitted Sterling to use the name or the mark, "PINE ACTION," as well as to use certain ...

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