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E. & J. Gallo Winery v. Gallo Cattle Company

United States Court of Appeals for the Ninth Circuit
967 F.2d 1280 (1992)


Facts

Ernest, Julio, and Joseph Gallo were brothers. Ernest and Julio founded E. & J. Gallo Winery (the winery) (plaintiff) and obtained trademarks for the name “Gallo.” The winery eventually sued a cheese and salami producer known as Gallo Salame for trademark infringement. The winery and Gallo Salame reached a simultaneous assignment and license-back agreement, through which Gallo Salame could continue to use the Gallo name for its products under license to the winery. The agreement included a quality-control program through which the winery could monitor the quality of the products put out by Gallo Salame under the Gallo name. In the meantime, Joseph Gallo opened a dairy business called the Gallo Cattle Company (the dairy) (defendants), which eventually came to sell cheeses under the mark “Joseph Gallo.” The winery sued the dairy and Joseph for trademark infringement. The district court ruled for the winery and enjoined Joseph from using the Gallo name. Joseph appealed, alleging that the winery lacked a valid ownership interest in the mark because the assignment and license-back agreement with Gallo Salame had been in gross and therefore invalid.

Rule of Law

Issue

Holding and Reasoning (Fletcher, J.)

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