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Quality Inns International, Inc. v. McDonald's Corporation

695 F.Supp. 198 (D. Md. 1988)

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Quality Inns International, Inc. v. McDonald’s Corporation

United States District Court for the District of Maryland

695 F.Supp. 198 (D. Md. 1988)

Facts

Quality Inns International, Inc. (Quality) (plaintiff) marketed a new chain of hotels to be called “McSleep Inn.” When Quality first announced its plans, the question “What will McDonald’s think?” repeatedly arose. McDonald’s Corporation (McDonald’s) (defendant) argued that Quality’s use of “McSleep” infringed on McDonald’s trademarks, which consist of the prefix “Mc” plus generic words. McDonald’s argued that Quality’s use of a similar mark would create confusion among consumers and that it would allow Quality to benefit from McDonald’s goodwill and reputation. Both McDonald’s and Quality conducted surveys of potential consumers. In McDonald’s surveys, the confusion rate of consumers was over 30 percent. In Quality’s surveys, the confusion rate was lower due to the fact that Quality showed the potential consumers photos that included Quality’s name with the “McSleep” brand. Even then, the confusion rate was 16.3 percent. Quality filed for a declaratory judgment stating that “McSleep” did not infringe on McDonald’s trademarks. McDonald’s counterclaimed for trademark infringement, unfair competition, and dilution.

Rule of Law

Issue

Holding and Reasoning (Niemeyer, J.)

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