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WALLACE OIL CO. v. MICHAELS

December 14, 1993

WALLACE OIL CO., INC, Plaintiff,
v.
ROBERT MICHAELS, LEO FOTOPOULOS, SPI PETROLEUM, INC., ABDUL KHAN, SALIM EJAZ and JOHN DOE CORPS., Defendants.



The opinion of the court was delivered by: VINCENT L. BRODERICK

 VINCENT L. BRODERICK, U.S.D.J.

 I

 This case involves questions concerning a clash between the right of a gasoline supplier to enforce exclusive purchase agreements with local stations and the right of a new gasoline station owner to change the station's source of supply. It also raises issues concerning whether the logo of the old source must be removed before any differing gasoline is placed in a pump, and the consequences of any delay in changing the logo.

 The litigation arises from a shift in ownership and source of gasoline supply at a local gasoline service station at 484 North St., Middletown, New York (the "station"). These events generated claims by plaintiff Wallace Oil Co., Inc. ("Wallace"), a former supplier of gasoline to the station defendant Robert Michaels ("Michaels), of trademark infringement in violation of the Lanham Act (15 USC 1051 et seq (the "Trademark Act") by the new owner of the station, defendant Leo Fotoupolos ("Fotoupolos") and the new gasoline supplier, defendant SPI Petroleum, Inc. ("SPI"). Wallace also asserted pendent state claims for breach of a long-term exclusive gasoline supply contract between Wallace and Michaels, and interference that contract by SPI.

 On or shortly before August 16, 1991, Michaels transferred control, operation and ownership of the station to Fotoupolos; SPI replaced Wallace as the source of gasoline supply to Fotoupolos as new owner. On August 16, 1991, an SPI truck arrived at the station to deliver gasoline although a sign bearing the SUNOCO trademark (that of Wallace's source of supply) was prominently displayed above the station. SPI states that it declined to pump gasoline until that sign was covered and any other SUNOCO names removed from display.

 Wallace has settled with Michaels. SPI and Fotopoulos have moved for summary judgment. Because of inadequacy of factual presentations by all parties, I deny the motions without prejudice, and describe below the issues I find the parties should address.

 II

 The primary purpose of trademark law is to avoid confusion on the part of purchasers concerning the origin of goods or services. See generally San Francisco Arts & Athletics v USOC, 483 U.S. 522, 97 L. Ed. 2d 427, 107 S. Ct. 2971 (1987).

 Presence of an obsolete sign containing the trademark of a product no longer offered is potentially confusing. Continued display of such a sign or a likelihood of such display would justify injunctive relief. See 15 USC 1116; Charles of the Ritz Group v. Quality King, 832 F.2d 1317 (2d Cir 1987). Injunctive relief can be granted without proof of actual monetary or other injury, so long as such injury is threatened. See General Leaseways v. National Truck Leasing Ass'n, 744 F.2d 588 (7th Cir 1984) (injunctive relief), and the same case at 830 F.2d 716 (7th Cir 1987) (zero damages).

 Evidence of actual confusion or reason to infer actual confusion on the part of customers will support damage claims. See 15 USC 1117; Hesmer Foods v. Campbell Soup, 346 F.2d 356 (7th Cir), cert. denied 382 U.S. 839, 15 L. Ed. 2d 81, 86 S. Ct. 89 (1965). Intentional use of another's mark suggests likelihood of actual confusion. Mobil Oil Corp v. Pegasus Petroleum, 818 F.2d 254, 258 (2d Cir 1987).

 In the present case, plaintiff has submitted photographs showing an SPI truck arriving at the station to deliver gasoline while a large SUNOCO sign towers above the station. While SPI asserts that the SUNOCO logo was covered over before gasoline was pumped, this was clearly not done as of the time the SPI truck arrived. See Little Tor Auto Center v. Exxon, 830 F. Supp. 792, 1993 U.S. Dist. LEXIS 12736, 1993 WL 359924 (SDNY 1993).

 There is no evidence now before me, however, suggesting that the SUNOCO name remained visible for more than a few hours at most, is continuing to be, or is threatened to be, used at the station. Nor is there any evidence that presence of the SUNOCO name during any brief display at the station after SPI gasoline was pumped led to any actual confusion.

 Where improper action is taken, such as delivery of non-SUNOCO gasoline combined with discontinuance of SUNOCO gasoline before removing the SUNOCO sign, but no traceable or implicit adverse consequences flow, it is possible that there may be a legal violation but no relief which can be granted. See generally ...


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