Published 07/31/2021 by CIONCA IP TEAM (SE)
The United States Supreme Court Case Dairy Queen v. Wood is relatively straightforward, even though the language in articles describing the issue is difficult to read. Let's break it down into simple to understand terms, which will also improve your legal understanding.
This case involved two parties in 1962. On one side is the fear of all milk cows, giant fast-food chain Dairy Queen. On the other is McCullough, a party that owns the trademark to the phrase "Dairy Queen" in Pennsylvania.
Dairy Queen, Inc. can afford to pay for exclusive rights to use their nationally recognized business name in the state. Its revenue from franchises in the area should well exceed the price to use the trademark. However, the corporation likely didn't realize how costly the deal would later become. But we're jumping ahead of ourselves. Let's discuss what happened next.
Dairy Queen entered a contract with McCullough, agreeing to pay $150,000 for the exclusive right to use the trademark "Dairy Queen" throughout Pennsylvania. However, after making this agreement, Dairy Queen, Inc. decided not to complete its contract.
Instead of sending payments on their agreed trademark licensing fee to McCullough, Dairy Queen stopped making payments. So, McCullough sent the corporation a letter that canceled their right to use the trademark in Pennsylvania.
It was at this time that the ice cream fast food retailer had a decision to make. The corporation could either try to resolve the contract, change their branding in the state of Pennsylvania, or ignore the issue until it led to legal consequences. But the problem was that Dairy Queen felt that an oral agreement both parties made in January 1955 modified their original contract, thus meaning that there was not a break of assurance on their behalf.
As you can guess, with a dispute between two parties on breach of contract, DQ didn't make any changes to the branding of their fast-food restaurants in the state. However, they also did not resolve the issue with McCullough. Instead, the corporation continued breaching the contract and ended up in the Federal District Court, the Court of Appeals, and the Supreme Court. Here's what happened next.
In the trademark suit, McCullough sought three resolutions for the breach of contract.
Then, what happened had a significant impact on proceeding court cases. Dairy Queen, Inc. responded to this suit, requesting a trial by jury. The District Court did not approve this request. Next, the Court of Appeals denied a Dairy Queen, Inc. request to receive a trial by jury. Finally, the case made it to the Supreme Court.
The Supreme Court had a different stance on the case than the two proceeding courts. Justice Hugo L. Black felt that Dairy Queen, Inc.'s request to receive trial by jury was appropriate. Because McCullough wanted damages, Dairy Queen, Inc. had a right to trial by jury. However, both courts deprived Dairy Queen of their seventh amendment right. Therefore, the case could not continue, as the legal process failed to provide Dairy Queen, Inc. rights in their court cases.
Disclaimer: The views and opinions expressed throughout this blog are the views and opinions of the individual author(s) and/or contributor(s) and do not necessarily reflect the views and opinions of our firm, CIONCA IP Law. P.C.
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