The Murphy Door Bed Co., Inc. v. Interior Sleep Systems, Inc., et al.
874 F.2d 95 (1989)
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Rule of Law:
A product name that was originally coined by a manufacturer can become a generic term if the public expropriates it for common use to describe a type of product, thereby losing its trademark protection. However, a competitor can still be liable for unfair competition if they pass off their own product as that of the original manufacturer, and parties may be contractually bound to cease using even a generic term.
Facts:
- At the turn of the century, William Lawrence Murphy invented a concealed wall bed and, in 1925, incorporated the Murphy Door Bed Company ('Murphy Co.') to sell it under the name 'Murphy bed'.
- In December 1981, Frank Zarcone, on behalf of Interior Sleep Systems, Inc. ('ISS'), entered into an exclusive distributorship agreement with Murphy Co.
- The agreement contained a clause stating that upon termination, ISS agreed 'to discontinue the use of the name "Murphy bed"'.
- In 1984, the Trademark Trial and Appeal Board (TTAB) affirmed the denial of Murphy Co.'s application to register the 'Murphy bed' trademark, finding the term had become generic.
- After learning of the TTAB decision, Zarcone formed his own companies and began using the Murphy name, including obtaining a telephone listing for 'Murphy Bed Company'.
- In March 1986, Zarcone filled an order from Magnolia Builders for Murphy beds using beds his own company manufactured, though he designated them on the invoice with Murphy Co. model numbers.
- Murphy Co. officially terminated the distribution agreement in September 1986 and demanded that Zarcone cease using the 'Murphy' name as required by their contract.
- Following the termination, Zarcone continued to advertise his products as 'Murphy Bed Co. of America, Inc.--Original Wall-Bed Systems' and 'The New Murphy Beds'.
Procedural Posture:
- The Murphy Door Bed Co., Inc. filed suit against Interior Sleep Systems, Inc., Frank Zarcone, and other corporate defendants in the United States District Court for the Eastern District of New York.
- The complaint alleged claims of trademark infringement, unfair competition, and breach of contract.
- After a bench trial, the district court found for Murphy Co. on all counts, holding that "Murphy bed" was a protectable trademark with secondary meaning.
- The district court entered a judgment awarding compensatory and punitive damages and issued a permanent injunction prohibiting defendants from using the Murphy name.
- Frank Zarcone and the defendant corporations, as appellants, appealed the judgment to the United States Court of Appeals for the Second Circuit.
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Issue:
Is the term "Murphy bed" a generic term that cannot be protected as a trademark because it has been appropriated by the public to describe a type of bed?
Opinions:
Majority - Miner, J.
Yes, the term "Murphy bed" is a generic term that cannot be protected as a trademark. When a term coined by a manufacturer is alleged to have been expropriated by the public, the burden is on the defendant to prove it has become generic. Here, the defendants met that burden by presenting evidence of the TTAB's decision finding the term generic, the inclusion of "Murphy bed" in dictionaries as a standard description, and numerous examples of its general use in newspapers and magazines. Because the term is generic, the claim for trademark infringement fails. However, Zarcone is still liable for unfair competition for "passing off" his products as those of the original Murphy Co. by using their model numbers and advertising his beds as "original." Furthermore, Zarcone is liable for breach of contract because the clause requiring him to cease using the name upon termination is enforceable, regardless of the term's generic status.
Analysis:
This case clarifies the doctrine of "genericide," where a once-distinctive trademark loses its legal status by becoming the common descriptive name for a type of product, joining brands like Aspirin and Thermos. It establishes that for a coined term, the burden of proving it has become generic falls on the defendant alleging it. The decision also draws a critical distinction between trademark infringement and unfair competition, demonstrating that even when a term is generic and free for all to use, a competitor cannot use it to actively deceive consumers into believing their product originates from the first manufacturer. This holding reinforces that contractual obligations can restrict behavior—such as using a name—that trademark law itself might otherwise permit.
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