NAACP v. NAACP LDF Memorandum of Law in Support of Defendant's Motion for Summary Judgment

    UNITED STATES DISTRICT COURT

FOR TITE DISTRICT OF COLUI{BIA

x

NATIoNALAsSocIATIoNFoRTIIEADVANCEIIiENT
OF COLORED PEOPLE, 2

Plaintiff, : Civil Action No'
82-1 424

V. (Jackson, J. )

N.A.A.C.P. LEGAL DEFENSE AND EDUCATIONAL :

FUND, INC.,
Defendant.

x

!.tEuoRANDUl{oFLAwINSUPPoRToFDEFENDANTIS
MOTION FOR SUT,IT.{ARY JUDGUENT

PAUL, WEISS' RIFKIND, WEARTON &.GARRISON
A partnership including Professional

corporations
AttorneYs for Defendant
345 Park Avenue
New Yorkr New York 10154
(212) 544-8000

Of Counsel:

Jay Topkis
Kenneth Roth

AKIN, GUUP, STRAUSS, HAUER & FELD

Att,orneys for Defendant
1333 tlew UamPshire Avenue' N'W'
Suite 400
Washington, D.C.20036
(202) 887-4000

of Counsel:

Vernon E. Jordan, JE.
Daniel JosePh, P.C.

PARKER AUSPITZ NEESEMANN & DELEHANTY P'C'
AttorneYs for Defendant
415 ltladison Avenue
New York, New York 1 00 1 7

(212) 355-4415
Of Counsel:

Barrington D. Parker, JE.
Charles S. Barquist



TABLE OF AUTHORITIES

CASES Page

11

7r 9

7r 9

5

5

5

9

*Ancient Eqvptian Arabic Order of Nobles of the
4 Mystic 929) o.... 10

-

*Anheuser-Busch, Ine. v. Du Bois Brewing Co.,

-rffici 
,

339 u,S. 934 (1950) ...............................
Ambrosia Chocolate Co. v. Ambrosil lgfg--eakeryr-

3 (4
fniea, 333 U.S. 882 (1948) ........:........o.

Bernard v. Gulf Oi1 Co.r 519 F.2d 459 (5th Cir.

-i9ao) 
@, 452 u.s. 89 (1981) o.......

*Creswill v. Grand Lodge x
= , 22 """"""'o"'

crotoll.t"h co. ,r. Laughlin , zoa F.2d 93 (2d
Cir. 1953 ) .. .. . . . .. . . . . o ' o ' " " " t ' ' ' ' ' t ' ' " ' ' " ' '

Cuban Cigar Brands, N.V. .v. -UP{raBn.-IgtefE3lionalr1090 ( s. D.N. Y. 1978 ) ,
'EEfla mem. , 607 F.2d 995 ( 2d Cir. 1979 ) . ..........

*Dawn Donut Co. v. Hartrs Food Storesr-f4111r
ffi35s ....o.........

*Dwinel1-wriqht Co. v. White llouse Milk Qo.,ffi(2d ..............
*tlavi land & co. v. Johann Eavi land q!tnE_-@-,
@p. """t""""t'

NAACP v. Button, 37 1 U.S. 415 ( 1953) ...................

10

10

10

11

NAACP Leqal Defense and Educational Fund, Inc.

-

er l

Northcross v. Board of Educ., 511 F.2d 624 (5tft..=.--TT-rgzgffi, 447 u.s. 911 (1980)

*Pfluqh v. Eaqle White Lead Co., 185 F. 769 (3d
tir. ) .s. 515 (1911) ..........

Polaroid Corp. v. Pollqed Electronics Corp.,
ffi4e2

368 U.S. 820 ( 1961 ) ............. ............ -

*Robinson Co. v. Plastiq E.esearch & Dev. Corp.,----ffi-Ffsupp .................



TABLE OF AUTTIORITIES ( cont 'd )

Co. v. Lehman, 625 F.zd

Paqe

9, 10

11
Sheilats Shlne Products, Inc. v. Sheila Shine, fnc.7

73)ffi.

CASES (contrd)

*Sara aVi

STATUTES

15 U.S.C. S

15 U.S. C. S

15 U.S.C. S

15 U.S.C. S

15 U.S.C. S

4 Callmann, Unfair Competition Trademarks and
[onopolies S 97.3(a) (3d ed.1970) .................

MISCELLANEOUS

Cases or authoriEies
asterisks.

chiefly relied uPon are marked bY

1t



UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUUBIA

-

NATIONAL ASSOCIATION FOR THE AD\ANCE!'IENT
OF COLORED PEOPLE,

Plaintiff,

V.

N.A.A.C.P. LEGAL DEFENSE AND EDUCATIONAL
FUND, rNC.,

De fendant '

x

: CiviI Action No.
82-1 424

(Oberdorfet, J. )

x

MEI.IORANDI I'f OF I"AW IN SUPPORT OF DEFENDANT I S

!{OTION FOR SU

Preliminarv Stat,ement

The facts here are clear and simple: lrlore than

four decades dgor by actions of its board and board members,

plainti tf gave birth to defendant and Provided it with its

namer.N.A.A.c.P. Le9a1 Defense and EdUCational Fund, Inc'n

The parent explicitly endowed its child with the N.A'A'C'P'

initials, and the initials became a Part of defendant's

identity. No restriction on the use of the initials was

suggestedT no right was reserved. Plaintiff never hinted

that it, might one day seek to erase the identity it' had just

conferred.

Defendantgraduallymaturedtobeanindependent

organization, a fuII partner in the fight for racial justice'

sometimes together, sometimes on different fronts, Plaintiff

and defendant advanced the cause of racial justicer each

under a banner that included the N.A.A.c.P. initials' The

initials served both as a vital symbol of the cause they

furthered.



Plaintiff allowed years to elapse after defendantr s

birth and independence without ever suggesting that it might

contest defendant's right to use the initials. Defendant

grew and thrived under the justified belief that its name was

beyond disPute.

Now, after decades of sharing the N'A'A'C'P'

initials, plaintiff seeks by this action suddenly to disown

its namesake. Disregarding its unconditional act of pater-

nityr plaintiff seeks t,o monopolize the init,ials it had

agreed to share.

The pertinent facts are not in dispute. Indeed,

wit,h commendable candor, plaintiff has Pleaded most of them

to the point where a motion for judgment on the Pleadings

would be entirely in order. But we seek here a more final

resolution of this controversy: Summary judgnent dismissing

the complaint.

The Record Facts

In 1939, plaintiff caused the creation of defendant

as a New York not-for-profit corporation under the name

N.A.A.C.P. Legal DefenSe and EdUCatiOnal Fund, Inc. on octo-

ber g, 1939, Plaintiff's board of directors adopted a resolu-

tion explicitly authorizing the new organization to use t'he

N.A.A.C.P. initials as part of its name:

WHEREASrThefollowingindividuals--Herbert
it. Lehman , wi 1li am AI 1an Ne i l son ' Ar th ur B '
Sping".", william II. tlastie, tltary l{hite ovington ,

charl"s i. Toney, Hubert T. Delany as Direc-
tors of the "N.A-A-c.P. Legal Defense and
Education Fund, Inc.rn have requested permission
of the National Association Ifor] the Advancement'
of Colored People to use the initials, .N.A.A.C.P.n,



in an applieation for a
of the rrN.A.A.C.P. Legal
Fund, Inc. n ; therefore,

Certificate of IncorPoration
Defense and Educational

BE IT RESOLVED, That the Board of Directors of the
National Association for the Advancement of Colored
Peop1e grant permission for the use of the initials,
nN.i.A.c.P.n by the "N.A.A.c.P. tegal Defense and
Education Fund, Inc.' and authorize the President and
Secretary to execute what,ever PaPers might be necessary
to carry out this resolution.

The resolution conferred the right to use the initials uncon-

dit,ionally: It articulated no time limit and reserved no right

of modification or revocation.

On t'larch 20, 1940, after the court approval required

under New York law for the creation of a not-for-profit, corPo-

ration entitled to practice law, defendant's certificate of

incorporation was fi1ed. On April 30, 1940, the U.S. Treasury

Department ruled t,hat defendant tdas entitled to t,ax exemption

and that contributions to it were deductible under the Inter-

nal Revenue Code.

From the outsetr defendant was formally independent

of plaintiff. With the passing years, defendant also gradually

became completely independent of plaintiff in practice- When

defendant first began operations in 1940, it shared directors,

offices and staff with plaintiff: its sole indicia of more

than formal independence were that it paid rent, for its use

of the office and telePhone, and that it reimbursed plaintiff

for the salaries of ttro employees. In 1941 , when defendant

began its o$rn fund-raising efforts, its board came to include

members who were not directors of plaintiff. ]n 1952, defen-

dant physically left plaintiff's premises and moved into its

own offices a few blocks away. By 1953, defendant supported



an annual budget of over $220 r 000.

The year 1957 marked the culmination of this Path to

independence. The Treasury DePartment had begun to question

defendantts tax-exempt status in light of defendantrs close

relationship wit,h non-tax-exemPt plaintiff . In resPonse t,o

this inquiry, defendant's board decided to sever all connec-

tions with plaintiff. On May 16, 1957, the board resolved that

'no person should be a Board Menber, officer or employee of this

corporation who is also a Board Member, officer or emPloyee

of the N.A.A.C.P. " By September 1957, this separation tdas

complete, and defendant had become fu11y independent of its

founder. The seParation was rePorted to the Treasury Depart-

ment and the Treasury has never since challenged defendantrs

tax-exempt status.

The separation lras nearly as much an act of plain-

tiff as of defendant. At the time the resolution was adopted,

a majority of the members of defendant's boardr 6s well as

all of defendantts officers, were also members of plaintiff's

board. The seParation was not a rash act by a disgruntled

chi1d, but a considered step made with the active consent of

t,he parent.

In 1961-62, plaintiff for the first time suggested

that defendant might cease using the N.A.A.C.P. initials, and

the suggestion was repeated in 1965 and 1956. These sugg.es-

tions t ere never written demands; they were merely informal

oral comments by certain of plaintiff's board members. On each

occasion, defendant determined to retain its name, and plain-

tiff did not pursue the matter further. Defendant, however,



began to take appropriate steps to distinguish itself from

plaintiff. Since that time, defendantrs official reports

have borne a disclaimer of any relationship with plaintiff.

The language currently enployed on defendantrs stationery is:
NThC NAACP LEGAT DEFENSE & EDUCATIONAL FUND is not
part of the National Association for the Advancement
of Colored People although it was founded by it and
shares its commitmerit to equal rights. LDF has had
for over 25 years a separate Board, program, staff,
office and budget. r

For the next twelve years, plaintiff uttered not

one word of protest over defendant's name. In reliance on

plaintiffrs consent and acqui.escence, defendant continued

to use its name. It built a large organization and developed

substantial reservoirs of good will under this name.

The courts have repeatedly praised defendant

for its 1ega1 work under this name. See, €.e.7 NAACP v.

Button, 371 U.S. 415, 421-22 1t963); @[ v. Gulf Oil Co.,

519 F.2d 459 | 470 (5th Cir. 1980) (en banc), aff 'd, 452 U.S.

89 (1981); Northcross v. Board of Educ., 611 F.2d 624, 637

(6th Cir. 1979), cert. denied, 447 U.S. 911 (1980); NAACP

Legal Defense and Educational Fund, Inc. v. Campbell, 504 F.

Supp. 1365, 1358 (D.D.C. 1981) (Gese11, J.).

Defendant has spent millions of dollars and years of

effort in soliciting gifts and recruit,ing 1ega1 talent in the

name of the N.A.A.C.P. Legal Defense and Educational Fund, Inc.

Attempting to emulate defendantrs success, many

other organizations have styled themselves as the n

Legal Defense and Educational Fund, fnc.r" or some close

variant thereof. We have learned that at least 13 such

organizations exist today, their names virtually identical to



defendantts except for the N.A.A.C.P. initials-
On December 29, 1978, plaintiff sent a letter to

defendant claiming that some unspecified confusion results from

the concurrent use of the N.A.A.C.P. initials. The two organi-

zations met to discuss the matter and, while defendant pledged

to cooperate ful1y in avoiding any confusion that might exist

and t,o better coordinate activities between the tlro grouPs, it

refused to give uP its right to use its name.

On June 28, 1979, plaintiff's board adopted a reso-

lution purporting t,o nrescind its resolution of October g,

1939r and revoke the permission granted to use the initiaLs

'NAACP.'N

On January 26, 1982, Plaintiff registered the

N.A.A.C.P. initials with the United St,ates Patent and

Trademark Office. Fina11y, on May 25, 1982, Plaintiff
brought this suit.

Arqument

On the above incontestable factsr w€ submit, defen-

dant is entitled to sunmary judgnent dismissing the complaint.

A variety of faniliar lega1 doctrines is apPlicable, each of

them fatal to plaintiffrs position.

I

Plaintiff Consented to Defendantrs Use
Of the N.A.A.C.P. Initials

We have searched the authorities in vainr w€ confess,

for any case squarely in point. Never before, aPParently, has



a parent organization endowed its offspring with the parentrs

name and, over forty years later, sought to deny the birthright.

The pertinent legal ProPosition has, however, been

voiced by Chief Judge Learned Hand. In Dwinell-Wright Co.

v. white House tlilk co., 132 E.2d 822 (2d Cir. 1943), he

carefully analyzed the law aPPlicable to the use by a

latecomer of a trademark owned by another, and said of the

latecomer:

He must show some reason why it will not be just
to stoP him. That he mayr'.of course do, if he
has acled upon the actual consent of the owner

emPhasis added) '

In short, consent is consent. When it is given freely,

deliberately and without linit, the act is conclusive on the

donor. Cf. Croton Watc! Co. v. Laughlin,208 F.2d 93,96 (2d

cir. 1953); 15 U.S.C. S 1114( 1). Plaintif f is bound by the

consent that it long ago gave.

that plaintiff now has registered the initials as a

trademark does not undo its prior consent3 registration

creates no ne!, right against a known concurrent user of

a mark. In Eaviland & ca1 v. Johann Haviland chlqe-lcsE-,

269 F. Supp. g28 (S.D.N.Y. 19671| the court rejected plain-

tiffts attenpt to use its belated registration of a mark as

a basis for challenging a long-condoned concurrent use of the

mark:

"The concurrent use of this mark for many years
was a matter of common knowledge; and so far as the
defendant . . . is concerned, plaintiff's regis-
tration has no effect uPon the status quo ante"
Id. at 935.

See also 15 U.S.C. 51055; 4 Cal1mann, Unfair Competition

Trademarks and Monopolies S 97.3(a), at 587 (3d ed. 1970)'



II
Ilaving Acquiesced in Def endant's Use

Of the Initials, Plaintiff Is Estopped
From Now Challenging that Use

Plaintiff is further barred from challenging

defendantrs use of the initials because 7 having long acqui-

esced in that us€2 plaintiff is now estoPPed to contest it.
Prior to 1967, various of plaintiff's directors occasionally

complained informally about defendant's name although the

complaints $rere never serious enough to be reduced to writing.

Then, plaintiff said and did nothing in the ensuing twelve

years. Those twelve years of silence -- not to mention the

forty years since defendant's creation, without formal protest

create an estoppel.

rn v.@,
175 F.2d 370 (3d Cir. 1949\, cert. denied, 339 U.S. 934

(1950), plaintiff, the brewer of "Budweiser' beer, filed suit

to prevent the defendant from selling beer under a similar

labe1; plaintiff then discontinued the suit, and pursued the

matter no further. When, years later, plaintiff again filed

suit, the court sustained a defense of estoppel: the Third

Circuit ruled that the original filing and discontinuance of

the suit, together with the absence of further protest,

"amounted to at least an acquiescence in use of the word

[Budweiser] by [plaintiff].n Id. at 375. The court warned

that if the plaintiff 'did not want to 1u11 [defendant] into

a false sense of securityrn it "should have followed uP t,he

discontinuance of the suit with some unambiguous action

asserting its claim." Id.



4llg!. v. Eagle White Lead Co., 185 F' 769

(3d cir.)r cert. denied, 220 u.s. 515 (1911), is closely

comparabLe to the facts at, bar. There, plaintiff wrote a

letter aEserting its exclusive right to a mark, but defendant

rejected plaintiffrs c}aim. Eight years later, Plaintiff
again asserted its exclusive right and defendant again

disagreed. Finallyr Six more years lhereafter, plaintiff

filed suit. The Court of Appeals held that plaintiff, by

its fourteen years of inactionr had acquiesced in defendantrs

use of the mark and vras estopped to challenge it. Id. at

772-73. Accord, Ambrosia chocolelg_lg_r_ v. Ambrosia cake

Bakery, Inc. , 165 e.2d 693t 595 (4th Cir. 1947), cert'

denied, 333 U.S. 882 11948); @ v' White

Ilouse !,tilk Co. , 132 9 .2d 822, 825 ( 2d Cir. 1 943 ) ; Ilaviland

& Co. v. Johann Haviland China Corp., 269 F'. SuPp' 928, 955

(s.D.N.Y. 1967).

III

Plaintiff Is Barred bY Its Laches

Plaintiff is also barred by its laches. The second

Circuit recently had occasion to sustain a laches defense

against a claim of t,rademark infringement in Saratoga Vichy

Spring Co. v. @!g, 625 F.2d 1037 (2d Cir. 1980) ' In

affirming the lower courtrs grant of summary judgment dis-

missing the complaint, the Second Circuit explained t'he laches

defense as follows:

9



"Defendantrs Proof in its laches defense
must show that plaintiff had knowledge of
defendant,ts use of its mark, that plain-
iiii i."xcusably delayed in taking action
with respeet thlretor and !ht! defendant-
;iii ue-i,re:udiced by permit,ting plaintiffwilI be prejudiced by PermlE'E'lng P.t.arnu,
in"euit"-ory-to asqgrl its.right. at :li:timd." Id: at 1040 (quoting CuPan 9isgr
Brands, N:J,- v. g

1090, .g.lt.I.

(WeinfeId, J . ), aff rd mem. , 607 F.2d 995
(2d Cir. 19'19)).

The'court held that the plaintiff, who had known of the defen-

dant's plans to revive its operations under a common name but

had waited seven years to contest those plans, l,as barred by

itslachesfromproceedingwiththesuit.Id.atl04l-42.
Accord, POlaroid corp. v. Polarad Electronics corp' | 287 F'2d

4g2 (2d Cit.)r cert. denied, 368 U'S' 820 (1951)'

TheUnitedSt,atesSupremecourtontwooccasions

sustained laches defenses on facts that closely paral1e1 the

of the trtystic Shrine v. Michaux, 279 U.S ' 737 ( 1929) ' and

creswill v. Grand Lodge K+ights of Pvthias of Ga. , 225 U'S'

245 (1g12), black benevolent associations had evolved under

names that closely resembled thOse of their white counter-

parts. The white associations, after years of standing

silently by while the black grouPs grew and prosperedr sud-

denly sought to enjoin the black associations from continuing

to use their names. The supreme court held t,hat the years of

inaction by the white organizations and their seeming acqui-

escence amounted to laches, which barred their injunctive

efforts.ltichauxr-Wr27gU'S'at747-49;Creswill'

El{pIB, 225 U. S. at 262-63 '

10



In the case at hand, Plaintiff knew of defendant I s

name but stood passively by for over twelve if not forty

-- years while defendant built its organization and estab-

lished its identitlt. Plaintiff's laches prevent it from

abruptly ignoring its years of silence and contesting defen-

dant I s nalne.

IV

Plaintiff Abandoned any Exclusive Right
It Uight Have Held by Granting Defendant
A "N;ked License" to use the Initials

Plaintiff is also barred from proceeding in this

action because, it the very least, it gave defendant a

nnaked license" to use the N.A.A.C.P. initials without any

control by plaintiff of the quality of services Provided

under the mark.

The Second Circuit outlined the nnaked license"

defense in Dawn Donq! lic-1 v. gartts Food Stores, Inc.r 267

F.2d 358 (2d Cir. 1959). As the court there explained,

a t,rademark holder is under an affirmative duty to control

the quality of services Provided under the mark, to the end

that the public will be able to identify a certain quality of

goods or services with the mark. When a trademark holder

grants a onaked licensen -- a license whj.ch reserves no right

in the licensor to control quality the law adjudges the

mark abandoned. Id. at 366-67 . @, Sheila's shine

products, Inc. v. Sheila shine, Inc., 486 F.2d ',l 14, 123-24

(5th Cir. 1973); Robinson Co. v. Plastics Research g Dev.

999 -, 264 F. SuPP . 852, 863-64 (w. D.Ark' 1957 ) ' See 15

u.s.c. ss 1055, 1064 & 1127.

1'l



In 1957, when plaintiff and defendant severed all
connections, plaintiff reserved no right to control defendant's

activities it left defendant free to do whatever it wanted,

and to use the N.A.A.C.P. initials in connection with its

activities. In lega1 terms, this nnaked license" worked an

abandonment of plaintiffrs rights in the mark.

CONCLUSION

By reason of the foregoing, defendantrs motion for

summary judgment, dismissing the complaint should be granted.

Dated: August 3, 1982

Respectfully subnit,ted,

PAUL, WEISS, RTFKIND, WHARTON & GARRISON
A partnershiP incJ.uding Professional

corporations

Of Counsel:

Jay Topkis
Kenneth Roth

Of Counsel:

Vernon E. Jordan, Jr.
Daniel Joseph, P.C.

Atto
345
New
(212)

AKTN, GUIIP, STRAUSS, TIAUER & FELD

UVtttnt laJ^ \..
Attorneys for Defendant
1333 New Hampshire Avenue,
Suite 400
Washington, D.C. 20036
(202) 887-4ooo

ys
rk Avenue

ork, New York
644-8000

12



Of Counsel:

Barrlngton D. Parkerr
Charles S. Barquiet

PARXER AUSPITZ NEESEI.TANN & DELEHANTY P.C.

ant
{15 ltladlson Avenue
New YorkT New York
(212) 355-441 s

Jr.

10017

13