A Vice Chancellor has ruled that two tire stores in New Castle County can continue to operate with similar names
Joseph Slights,, III – hinting at irritation in the case going to trial and offering a history of the Diamond name in Middletown – issued the ruling earlier this week.
In that case, Diamond State Tire sought an injunction to halt the use of Diamond Town Tire Pros & Diamond State Tire & Auto.
Diamond State is based in Bear while Diamond Town is located in Middletown.
The ruling noted that Diamond Town was opened by a long-time rival of Diamond State who also operates a commercial tire operation in nearby Glasgow. Diamond State started out as a commercial tire retailer, but later broadened its services.
According to the ruling, the Diamond Town name came out of the frequent use of Diamond in Middletown and a decision not to use the “Frog” name. Both names were mentioned in a conversation with a community relations representative for the Town of Middletown. The conversation seemed to buttress the argument that the Diamond Town owner did not deliberately set out to use a similar name.
Both names have been used in Middletown over the years, with the diamond description coming out of the configuration of the town’s boundaries.
The reason for the frog name, which is being used by a golf course/country club in the town, is more obscure but may have something to do with a “frog” – a railroad switch that allows a train to move to another track.
Slights said the Diamond name is common in Delaware, which is often known as the Diamond State.
Delaware has a deceptive trade practices law that governs the use of competitors using similar names or physical appearances. Often, a much larger company launches the action in state or federal court and the smaller competitor, facing the legal weight of the larger company, makes changes.
Late last year, Jimmy’s Grill settled a suit filed in federal court over its new Rehoboth location having an appearance that was similar to the look of the nearby Cracker Barrel.
Slights acknowledged that similar names and similar businesses could cause confusion. (Both retailers have a diamond design in their logos). However, he noted that the Middletown and Bear-Glasgow, while having some overlap, are separate markets.
“The two businesses will have to co-exist as named and I have no doubt that they can do so, both profitably, if they chose to focus their energy on sustaining and building their businesses as opposed to ongoing litigation,” Slights concluded.
Click here to read a copy of the ruling.