Judges: D. R. ALEXANDER
Agency: Department of State
Latest Update: Jan. 02, 1981
Summary: Name used by competitor found to deceptively similar and thus rescinded.
80-1019.PDFSTATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
FLORIDA HOTEL AND MOTEL ASSN., ) INC., )
)
Petitioner, )
)
vs. ) CASE NO. 80-1019
) FLORIDA HOTEL AND MOTEL ASSN., ) INC. and STATE OF FLORIDA, )
DEPARTMENT OF STATE. )
)
Respondent. )
)
RECOMMENDED ORDER
PURSUANT TO NOTICE, an administrative hearing was held before DONALD R. ALEXANDER, Administrative Hearing Officer, on July 23, 1980, at City Hall, Jacksonville, Florida.
APPEARANCES
For Petitioner: Harold B. Wahl, Esquire
Title Building
111 West Forsyth Street, Suite 405 Jacksonville, Florida 32202
For Respondent: Donald C. Jones, Esquire Florida Hotel 621 University Boulevard, North and Motor Hotel Jacksonville, Florida 32211 Assn., Inc.
For Respondent: William J. Gladwin, Jr., Esquire Department of The Capitol
State Tallahassee, Florida 32301
On or about June 24, 1978, an application was filed with the Division of Corporations (Division) of the Department of State pursuant to Section 607.027, Florida Statutes, on behalf of respondent seeking to reserve the corporate name "Florida Hotel and Motor Hotel Association, Inc." The reservation was approved by the Division effective June 27, 1978.
On June 28, 1978, the Director of the Division of Corporations corresponded with respondent and advised there was an existing active Florida corporation called "Florida Hotel and Motel Association, Inc." and that, because the names were deceptively similar, the Division was rescinding the name reservation. On June 30, 1978, an application was filed with the Division on behalf of petitioner requesting the reservation of the same corporate name. The request was granted by the Division on that date. The name has been subsequently renewed pursuant to Section 607.027(1), Florida Statutes, and is still reserved for petitioner pending resolution of this matter. Having discovered the
granting of the corporate name to petitioner, respondent initiated a series of inquiries with the Division in November, 1978, seeking an explanation of the action of the Division, and requesting an administrative hearing to contest the award of the name. The matter was assigned DOAH Case No. 79-2309.
On March 11, 1980, the Division advised petitioner it had concluded the first name reservation by respondent was valid and should not have been terminated. The Division further advised that 20 days thereafter it intended to remove from the corporate name reservation records the name "Florida Hotel and Motor Hotel Association, Inc.," as reserved by petitioner on June 30, 1978, and grant the name to respondent, the original reservationist. As a result of this decision, respondent withdrew its complaint, and Case No. 79-2309 was closed by Order dated May 1, 1980. Petitioner then initiated this proceeding challenging the propriety of the Division's action.
The issue herein is whether the grant of name "Florida Hotel and Motor Hotel Association, Inc." to respondent by the Division of Corporations was erroneous in that it is deceptively similar to petitioner's name.
FINDINGS OF FACT
The Florida Hotel and Motel Association, Inc. (Association or petitioner) is a non-profit corporation whose membership includes various hotels and motels throughout the State of Florida. The organization has been in existence since the 1950's. As of July, 1980, the Association had approximately 600 members. There are currently in excess of 6,000 licensed properties in the State that are eligible to join the Association.
Mr. David Arpin was employed in various capacities by the Association for more than twenty years. His last position was that of executive vice president. Because of an illness, Mr. Arpin's full time activities with the petitioner ceased in December, 1977. However, he continued to receive compensation from the Association until June 30, 1978, on a "sickness leave of absence." (Exhibit No. 1). His employment with the Association was terminated on that date. (Exhibit No. 4).
On November 7, 1977, a memorandum was prepared for Mr. Arpin by the Association's secretary which advised him that the name "Florida Hotel and Motor Hotel Association, Inc." was available for reservation in the Division of Corporations. (Exhibit No. 5). Mr. Arpin claims he did not read the memorandum at that time. However, he acknowledged that sometime after January 1, 1978, he became aware of the availability of the corporate name in question. On June 26, 1978, Mr. Arpin, through his counsel, reserved the name "Florida Hotel and Motor Hotel Association, Inc." Because of the controversy with petitioner, the respondent has been unable to utilize the name since that time.
Since the cessation of his relationship with the Association, Mr. Arpin has operated an organization known as the Florida Lodging and Food Service Association, Inc. It is comprised of approximately 100 members, of which the majority are hotels and motels. It is in direct competition with petitioner for memberships. The logo used by the corporation is also strikingly similar to that used by petitioner.
If the name "Florida Hotel and Motor Hotel Association, Inc." is awarded Mr. Arpin, he intends to use it in conjunction with an industry newsletter to be distributed to hotels and motels, or to substitute it in lieu of the corporate name now being used. He will continue to compete with
petitioner, and solicit memberships from motels and hotels that are now members of the Association.
Until July 1, 1980, the uncodified practice of the Division relative to the awarding of corporate names was that there be at least a one word difference in a corporate name from another in order to enjoy its use. Under this informal guideline, the Division took the position that the inclusion of the words "motor hotel" in lieu of "motel" constituted the necessary name difference for awarding the name to Mr. Arpin.
Prior to the 1960's, a distinction existed between the terms "motel" and "motor hotel". Typically, a motor hotel was larger than a motel, and offered a full range of services that a motel did not, such as food, beverages and a night club. In contrast to a motel, a motor hotel did not have doors leading from each room directly to the parking lot. Since 1960, this distinction has evaporated within the hotel-motel industry, and the words are used interchangeably in the trade and have the same meaning.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction of this cause and the parties thereto pursuant to Section 120.57, Florida Statutes.
Section 607.024(1)(b), Florida Statutes, provides in part as follows:
The corporate name:
(b) Shall not be the same as, or deceptively similar to, the name of any domestic corporation existing under the laws of this state. . .
Thus, the issuance of a corporate name that is deceptively similar to one already in existence is expressly prohibited by law.
Respondent asserts that the use of the words "motor hotel" in lieu of the word "motel" evidences a sufficient difference in the corporate names to escape the prescription in the statute. Respondent also asserts that tide hotel-motel industry perceives a difference between the two types of lodgings. However, the evidence herein warrants a different conclusion. While a distinction once existed between the two types of public accommodations, the distinction has long been lost. For many years, the industry itself has used the terms interchangeably, and it is difficult to conceive the traveling public viewing the two as different types of lodgings. Section 509.242(c), Florida Statutes, also supports this conclusion. In defining the term "public lodging establishment," the Legislature has construed motels, motor hotels, motor courts, tourist courts, motor lodges and the like as being the same.
The long-time relationship of Mr. Arpin to the Association, and the familiarity with him by members of the trade, coupled with the close similarity of the corporate names, will inevitably give rise to confusion on the part of public lodgings that may seek to become associated with a hotel-motel trade association. Such confusion will be exacerbated by the fact that both organizations have similar goals and objectives, and will solicit memberships from the same group of licensed properties.
The uncodified policy of the Division of Corporations that existed at the inception of this dispute has since been repudiated. Effective July 1,
1980, the Department of State adopted Rule 10-1.5(12), Florida Administrative Code, which provides as follows:
(12) Within the lodging industry, the terms motel and motor hotel shall be considered synonymous and shall not constitute a name difference.
The thrust of this Rule amendment is quite clear. In adopting the Rule, the Division has concluded the terms "motel" and "motor hotel" are so closely alike as to be deceptively similar. Had this dispute arisen after July, 1980, the Division would not have awarded the name at issue to Mr. Arpin. While the Rule cannot be given retroactive application, it evidences a clear intent that the two names are so deceptively similar as to result in confusion on the part of the public.
Based on the foregoing, it is concluded that the name "Florida Hotel and Motor Hotel Association, Inc." is deceptively similar to the name "Florida Hotel and Motel Association, Inc.", and the grant of same is proscribed by Section 607.024(1)(b), Florida Statutes.
It is, therefore,
RECOMMENDED that the grant of the name "Florida Hotel and Motor Hotel Association, Inc." to respondent be rescinded in that said name is deceptively similar to that of petitioner.
DONE and ENTERED this 30th day of September, 1980, in Tallahassee, Florida.
COPIES FURNISHED:
Harold B. Wahl, Esquire
DONALD R. ALEXANDER
Hearing Officer
Division of Administrative Hearings Room 101, Collins Building Tallahassee, Florida 32301
(904) 488-9675
Filed with the Clerk of the Division of Administrative Hearings this 30th day of September, 1980.
Suite 405, Florida Title Bldg.
111 West Forsyth Street Jacksonville, Florida 32202
Donald C. Jones, Esquire 621 University Blvd., North Jacksonville, Florida 32211
William J. Gladwin, Jr., Esquire Department of State
The Capitol
Tallahassee, Florida 32301
Docket for Case No: 80-001019
Orders for Case No: 80-001019
