Court Opinion

ID: 5836961
Source: CourtListenerOpinion
Date Created: 2022-01-12 22:41:30.081091+00
Date Added: 2024-06-11T08:43:38.570749
License: Public Domain

Kupferman, J.
(dissenting in part). Fraunces Tavern on Pearl Street in lower Manhattan is a landmark. It was operated by Samuel Fraunces, and it was here that General George Washington in 1783 said good-bye to his revolutionary comrades in arms. On the 100th anniversary of Washington’s farewell, there was organized the patriotic organization, Sons of the Revolution, the defendant-appellant herein, whose purpose was to keep alive the spirit of '76. It is a not-for-profit corporation.
In 1904, as the result of a bequest, the appellant was enabled to purchase the building comprising Fraunces Tavern. It had since its organization been working to restore and preserve the building, and it has maintained it in a condition closely approximating the original architecture and appearance. It has acquired ownership of neighboring buildings which are interconnected with the tavern, and a museum is there maintained. Portions of the tavern have been rented for *220operation as a restaurant, with the appellant as landlord since 1907. In 1937, the plaintiff-respondent became the tenant of the restaurant, with the current lease becoming effective January 1, 1977 for a term ending October 31, 1991. The lease contains provisions which give the appellant the right to control, in terms of quality, taste and fashion, the operation of the restaurant business.
Among other provisions in the lease are the following:
"Section 3.04. The business conducted by Tenant in the premises is only to be conducted under the name 'Fraunces Tavern Restaurant’ or such other name as Landlord shall from time to time approve in writing pursuant to the request of Tenant.”
"Section 6.02. Landlord reserves the right to name the Building and to change the name or address of the Building at any time and from time to time”.
"Section 29.01. Tenant, recognizing that the Buildings have been maintained as an historical landmark and as an additional inducement to Landlord to enter into this Lease, covenants and agrees that at all times (i) the business to be conducted at, through and from the premises and the kind and quality of the merchandise, food, and services offered in the conduct thereof will be reputable in every respect, (ii) the sales methods employed in said business, as well as all other elements of merchandising, will be dignified and in conformity with the highest standards of practice obtaining among superior type stores, shops and restaurants dealing in the same or similar merchandise, food and service or conducting a similar high-quality restaurant business in the Wall Street business district adjacent thereto, and (iii) the kind and quality of food and beverages and of the merchandise sold at, through or from the premises by Tenant shall be excellent in all respects, and (iv) the appearance of the premises (including the lighting and other appurtenances thereto), the appearance and deportment of all personnel employed therein, and the appearance, number, location, nature and subject matter of all displays and exhibits placed or installed in or about the premises, and of any signs, lettering, announcements, price schedules, tags or any other kinds or forms of inscriptions displayed in or about the premises, will be only such as does not meet with Landlord’s reasonable disapproval and, if at any time reasonably disapproved by Landlord, Tenant shall remove the basis for such disapproval in such manner and within such reason*221able time as may be specified by Landlord, in a written notice by it to Tenant for such purpose. Landlord believes that the operation by Tenant of its business at the premises is, as of the date hereof, generally in conformity with the standards herein above in this Section 29.01 set forth.”
"Section 39.04. Tenant shall remove all such lettering, improvements and modifications upon the termination of its Lease and shall repair any damage to the building or the sign occasioned thereby.”
"Section 40.01. Tenant covenants and agrees that in any and all advertising of the business of Tenant conducted in or from the premises whether through written, typewritten, mimeographed or printed circulars, radio programs, notices in the public press and publications, signs or by means of any other advertising media, Tenant will in no way state or imply that the Buildings are in any way the property of Tenant or of the restaurant operated by it in the premises. Tenant further covenants and agrees that it will not alter or distort the account of any historical fact respecting the premises or the Buildings in any of its advertising through any of the above described media or through any other media. Advertising material used and paid for by Tenant should describe the business of Tenant conducted in the premises only as 'Fraunces Tavern Restaurant’. If Tenant, after warning that a violation of the above conditions has occurred, shall thereafter repeat the same or a similar violation, Landlord may require and Tenant covenants and agrees that it will immediately, at its sole cost and expense, retract any such statement, implication, or error of historical fact to which Landlord shall have made objection in any and all of the advertising media in which such violation shall have occurred. The wording of such retraction shall be submitted to Landlord before publication and Landlord’s approval of such retraction in writing shall be obtained by Tenant which covenants and agrees that it will give to such retraction display or prominence equal to the display or prominence given to the advertising to which Landlord has taken exception as above set forth. The right to use the name 'Fraunces Tavern Restaurant’ in connection with Tenant’s business shall be limited to the restaurant business conducted in the premises and to no other business or location, and such right shall terminate upon the expiration or earlier termination of this Lease. Any regular doorman or person operating checking facilities on the premises *222shall, labor conditions permitting, be costumed in Colonial Costume consisting of powdered wig, tailcoat, breeches, long hose and display buckles on shoes, so designed as to portray in true and authentic manner the dress in use during the era of the American Revolution.” (Emphasis added.)
It is readily apparent that this is not a mere naked license discussed in Ritz Assoc. v Ritz-Carlton Hotel Co. (35 Misc 2d 425, affd without opn [but with one dissent], 19 AD2d 522, affd without opn 14 NY2d 670). It is obvious that by reason of ownership, intention, long usage and contract, the name Fraunces Tavern is the property of the defendant-appellant. It has acquired a "secondary meaning” indicating the defendant-appellant. (See Diamond, Untangling the Confusion in Trademark Terminology, 65 ABAJ pp 1523, 1525.) The right to use the name is inseparably associated with the building involved (Stogop Realty Co. v Marie Antoinette Hotel Co., 217 App Div 555).
In this litigation, the plaintiff sues, among other things, in the normal course of a tenant-landlord relationship, for water damage, a claim with respect to rent, etc. In addition, it contends that in connection with a grant of permission from appellant landlord to respondent tenant to construct a coatroom enclosure, there were impermissible conditions attached with respect to the use of the words Fraunces Tavern on items to be sold in the operation of the coatroom.
Among other things, the defendant-appellant landlord set forth various affirmative defenses and counterclaims, including a third counterclaim to declare its rights in the name Fraunces Tavern and to enjoin the respondent from prosecuting an application for a United States trade-mark in the name. In the interim, after the date of the order herein denying summary judgment to either side on a motion and cross motion, a certificate of registration was issued by the United States Patent and Trademark Office to the plaintiff-respondent tenant for a service mark for Fraunces Tavern. It is possible for a licensee such as the plaintiff to obtain a service mark as a "related company”, pursuant to sections 5 and 45 of the Lanham Act (US Code, tit 15, §§ 1055 and 1127). (See Seidel, What the General Practitioner Should Know About Trademarks and Copyrights [4th ed], p 117.)
The landlord, by virtue of its lease, being in legitimate control of the usage of the mark, would therefore be a beneficiary of the registration, and the licensee could not use the *223mark in advertising or labeling in any manner other than that specifically authorized by the licensor. (See Beran, An Introduction to Trademark Practice, ch III, § 4, pp 128-129.)
I would grant partial summary judgment to the defendant-appellant landlord on the third counterclaim, declaring its rights in the trade-mark. There does not seem to be any real dispute with respect to the right of the tenant to construct the cloakroom, and therefore summary judgment should be granted to the plaintiff-respondent on the second cause of action. However, the right to construct the cloakroom does not carry with it any rights with respect to any items to be sold therein with the name Fraunces Tavern used, without the permission of the landlord, subject to the terms of the lease.
Fein and Sullivan, JJ., concur with Ross, J; Murphy, P. J., and Kupferman, J., dissent, in part, in an opinion by Kupferman, J.
Order, Supreme Court, New York County, entered on July 24, 1979, affirmed, without costs and without disbursements.