I, KENNETH HADLAND, being duly sworn make oath and say
I reside and have my true place of abode at 351 Radcliffe Way, Hinsdale, Illinois. I am the Assistant Vice President and Assistant General Counsel of the Plaintiff. The Plaintiff is a corporation organized and existing under the laws of the State of Delaware, United States of
America, with its principal office located at One McDonald's Plaza, Oak Brook, Illinois, 60521. I have been duly authorized to make this Affidavit on the Plaintiff's behalf.
The Plaintiff develops, operates, franchises and services a worldwide chain of restaurants which operate under the trade name and trademark "McDonald's". The restaurants operated by the Plaintiff and its authorized subsidiaries, affiliates and franchisees (collectively referred to in this affidavit as "licensees") specialize in the preparation and sale of hamburgers, cheeseburgers, french fries, milk shakes, ice cream, apple pies and other value priced food items, including the world-famous "Big Mac", "Quarter Pounder", "McChicken", "Fish-O-Filet", and "Egg McMuffin"
sandwiches, "Chicken McNuggets" and other proprietary products that have been made famous through extensive use and advertising around the world. The restaurants operated by the Plaintiff and its licensees are so called "quick service" or "fast food" restaurants which do not provide waitress or waiter service; rather, products are sold to customers over the counter, and through drive-thru windows for take-out or on-premises consumption.
The Plaintiff opened its first "McDonald's" restaurant in 1955. As of March 1, 1995, the Plaintiff and its licensee's were operating 15,963 restaurants in 79 different countries and territories, (a list of which is exhibit 'A' hereto) under the trade name and trademark "McDonald's".
As of March 1, 1995, the Plaintiff and its licensees were operating 10,450 restaurants in the United States of America, 720 restaurants in Canada, 528 restaurants in England and in excess of 1400 restaurants in the balance of Europe, 1,132 restaurants in Japan and in excess of 70 restaurants in the Caribbean, including restaurants in Aruba, Bahamas, Bermuda, Guadeloupe, Martinique, the Netherlands Antilles, Puerto Rico, Trinidad and Tobago and the Virgin Islands. Any person residing in North America, the Caribbean, Latin America, Europe and Japan would be well aware of the Plaintiff's restaurant business and would associate the name "McDonald's" with the restaurant business operated by the Plaintiff and its licensees. At the end of the Plaintiff's fiscal year ended December 31, 1994, the combined annual sales of the restaurants operated by the Plaintiff and its licensees exceeded Twenty-Six Billion United States Dollars (US$26,000,000,000.00).
The Plaintiff and its licensees have used the trademark "McDonald's" extensively throughout the world in connection with the operation of the aforementioned restaurants and the sale of food and beverages at the said restaurants. The Plaintiff has registered the trademark "McDonald's" in numerous countries around the world and a listings of the registered trademarks owned by the Plaintiff for the trademark "McDonald's" is exhibited and annexed hereto marked with
the letter 'B' for identity.
The Plaintiff also owns other trademarks and logo types that have gained worldwide fame and notoriety their extensive use by the Plaintiff and its licensees the operation of their restaurants and by extensive advertising and marketing around the world, including the arched "M" logo (known around the world as the McDonald's Arches), "Big Mac", "Quarter Pounder", "McChicken", "Filet-O-Fish", "Egg McMuffin", "Chicken McNuggets", "Ronald McDonald and Design". The Plaintiff goes to great lengths to protect its trademarks and its internationally known name, reputation and goodwill from the practice of trademark pirating, which has become widespread and pervasive when companies like the Plaintiffs have built an international reputation and goodwill.
Since the year 1967, the Plaintiff has registered a number of its trademarks in Jamaica. Among the Plaintiff's trademarks now registered in Jamaica are the arched "M" logo, and numerous other trademarks, including "Big Mac", "McDonald's Quarter Pounder", and "McDonald's Golden Arches". The Plaintiff has filed all of the requisite renewals of its aforesaid trademark registrations.
Photocopies of the trademark registration certificates nos. B21019, B 17398, B 16214 and B 17849
for the Plaintiff s Arched "M" logo registered respectively on 14th March, 1973 and 27th June, 1979 are exhibited and annexed hereto and marked with the letter 'C' for identity and which have been duly renewed. The arched "M" is a distinctive feature of the Plaintiff's trade marks, signs and logos which is associated throughout the world as distinctive of the restaurants operated by the Plaintiff and its licensees.
The Plaintiff and its licensees engage in substantial advertising and promotion each year. In 1994, the Plaintiff and its licensees spent One Billion Five Hundred Million United States Dollars (US$1,500,000,000.00) equivalent to 5.8% of their total sales on advertising and promotion.
That advertising and promotion includes the extensive use of radio and television advertising, including advertising on the major U.S. television networks and so called television "Superstations" that are broadcast into Jamaica and cable television.
By virtue of the Plaintiffs extensive business operations and advertising throughout the world and its extensive holdings of trademark registrations throughout the world, including Jamaica, the Plaintiff has acquired widespread international reputation and goodwill which extends to Jamaica, so that the name "McDonald's" and "McDonald's Corporation" when used with the Plaintiff's business. Approximately Thirty Million (30,000,000) people visit a "McDonald's" restaurant operated by the Plaintiff or one of its licensees each day.
In particular, visitors to Jamaica, including most of the tourists who come to vacation in Jamaica from the United States of America, Canada, Europe and Japan, as well as, citizens of those countries residing in Jamaica and resident Jamaicans who have either travelled to countries in which the Plaintiff or its licensees operate restaurants or who have been exposed locally to the advertising and marketing efforts of the Plaintiff and its licensees through satellite and cable television, radio and other advertisements in publications circulated in Jamaica, would be familiar with the Plaintiffs trade name, trademarks, logos and food products and would associate the name "McDonald's" or "McDonald's Corporation" when used in association with a fast food restaurant with the Plaintiffs business.
The Plaintiff and its business have also been the subject of many articles in various publications of wide circulation around the world, samples of which have been exhibited and annexed hereto marked with the letter 'D' for identity.
In or about January 1973 in the course of exploring the feasibility of opening a restaurant in Jamaica, the Plaintiff discovered that a restaurant had been set up by the Defendants on the corner of Half Way Tree Road and Cargill Avenue, the civic address of which is 1 Cargill Avenue
in the Parish of Saint Andrew and I exhibit and annex hereto marked with the letter 'E' for identity, a copy of the advertisement which came to the Plaintiffs attention in January 1973.
The Plaintiff sought assistance in 1973 from its attorneys-at-law, Messrs. Myers, Fletcher & Gordon requesting them to investigate the matter and requesting, advice as to whether under Jamaican law the Plaintiff would be able to stop the unauthorized use of the name McDonald's. The Plaintiff was advised by Myers, Fletcher & Gordon in 1973 that the restaurant at 1 Cargill Avenue was being operated by the First Defendant whose principal shareholder and managing - director was the Second Defendant, Mr. Vincent Chang and the Plaintiff was further advised that the Plaintiff could not successfully bring an action to prevent the Defendants from using the name McDonald's.
By letter dated 23rd August, 1973 from Messrs. Myers, Fletcher & Gordon to the Plaintiff, Mr. Frank L. Myers, the then senior partner of Messrs. Myers, Fletcher & Gordon further reported upon a conversation which he had with the Second Defendant, the owner and managing
director of the First Defendant, in which it was stated, inter alia, that one Sandra McDonald, who had been a subscriber to the Memorandum and Articles of Association of the First Defendant, had no actual interest in the First Defendant and indeed that she was a young girl and a daughter of a formeremployee of Myers, Fletcher & Gordon whose name appeared as a subscriber as a sham by the Defendants to attempt to justify the adoption and use of the Plaintiff's name by reason of Sandra McDonald's interest in the company and I exhibit and annex hereto marked with the letter 'F' for
identity, a photocopy of the letter from Messrs. Myers, Fletcher & Gordon dated 23rd August, 1973.
The First Defendant was incorporated on the 16th September, 1971 with an authorized share capital of 1000 shares valued at $1.00 each. The Memorandum of Association was subscribed by Sandra McDonald and the Second Defendant and a photocopy of the Memorandum of Association
of the First Defendant which is dated 14th September, 1971 is exhibited and annexed hereto marked with the letter 'G' for identity. The most recent annual return filed on the First Defendant's behalf with the Registrar of Companies is dated the 11th day of August, 1994 and reveals that the directors of the First Defendant are the Second Defendant, Valerie Chang and Sylvia Tai, and that the shareholders of the First Defendant are the Second Defendant and Valerie Chang and a photocopy of the return dated 11th August, 1994 filed on the First Defendant's behalf with the Registrar of Companies is exhibited and annexed hereto marked with the letter 'H' for identity. The Second Defendant therefore continues to be the principal shareholder and managing director of the First Defendant, while Sandra McDonald who subscribed to the Memorandum of Association is not shown on the aforesaid return as having any connection or interest in the First Defendant, which further substantiates the fact that she merely subscribed to the Memorandum of Association as a sham concocted by the Second Defendant to register the First Defendant as a company with the name "McDonald's Corporation".
By further letter dated 20th September, 1973, Messrs. Myers, Fletcher & Gordon wrote to the Plaintiff forwarding a copy of an advertising special published in the Gleaner newspaper which showed the get-up then being used by the Defendants for the restaurant, which get-up included a knife, fork and spoon which was not used in the Plaintiffs signs or other get-up and was dissimilar from the Plaintiff's signs and a photocopy of the aforesaid letter and advertising special are exhibited and annexed hereto and marked with the letter 'I' for identity.
Further in 1973, the Defendants' restaurant operated as a sit down diner and drive in, with customers being served whilst seated in their motor vehicles which was not similar to the Plaintiffs restaurant operations. The Plaintiff
obtained photographs which depict the interior of the Defendants, restaurant at that time and copies of same are exhibited and annexed hereto marked with the letter 'J' for identity. By reason of the
advice of its then attorneys, Messrs. Myers, Fletcher & Gordon, that an action against the Defendants could not be successfully maintained the Plaintiff did not institute legal proceedings against the Defendants.
The Plaintiff actively pursued the possibility of opening restaurants in Jamaica throughout the 1970's and 1980's, but this proved not to be feasible due principally to stringent foreign exchange regulations which were not relaxed until 1991. During that period, the Plaintiff had
goodwill and reputation in Jamaica as the Plaintiff received numerous inquiries from prospective licensees expressing an interest in becoming the Plaintiffs franchisee for Jamaica. The Plaintiff received inquiries from more than 80 individuals, the majority of whom were Jamaican entrepreneurs expressing interest in obtaining a licence from the Plaintiff to operate in Jamaica.
The Second Defendant was one of the persons who made inquiry about the possibility of obtaining a franchise from the Plaintiff for Jamaica. The Second Defendant's inquiry was made by letter dated 3rd July, 1981, a copy of which is exhibited and annexed hereto marked with the letter 'K' for identity, whereby the shareholders of the First Defendant, which included the Second Defendant, through Messrs. Daley, Walker & Lee Hing, attorneys-at-law, made an offer to become the Plaintiffs franchisee for Jamaica in exchange for the acquisition by the Plaintiff of all equity in the First Defendant. The aforesaid offer was rejected by the Plaintiff.
Following the relaxation of exchange control regulations in 1991, the Plaintiff again investigated the possibility of expanding its business into Jamaica. In 1994, the Plaintiff began to formalize its plans to open restaurants in Jamaica by actively searching for suitable locations for
McDonald's restaurants throughout Jamaica. In the month of August 1994, the site for the first restaurant was located at Ironshore, Montego Bay in the Parish of St. James and the site of the second restaurant was subsequently located in Kingston.
The Plaintiffs plans to open restaurants in Jamaica were announced to the Jamaican public in a press conference held at the Sovereign Mail in the Parish of St. Andrew in October, 1994. The Plaintiff obtained the assistance of government agency JAMPRO in the planning and promotion
of its opening in Jamaica and the aforesaid press conference was attended by representatives from a wide cross section of the Jamaican community, including representatives of Jamaican businesses, members of government and members of the local press.
At that press conference, the Plaintiff announced plans for the opening of its first restaurant in Jamaica 'in the Montego Bay area and the opening of several more restaurants to follow in Kingston and other towns in Jamaica. At the time of the said press conference, the Defendants' restaurant was closed, the building at 1 Cargill Avenue had become derelict, and from inquiries made on the Plaintiffs behalf of persons occupying premises in the vicinity of the Defendants' restaurant, the First Defendant had not carried on business at the restaurant for several years up to the month of September 1995.
In implementing its decision to open restaurants in Jamaica, the Plaintiff also entered into a joint venture agreement with Patricia Isaacs, pursuant to which a joint venture company has been incorporated in Jamaica with licence to operate the first restaurant in Jamaica using the Plaintiff's name, trademarks and logos. Further, a ground breaking ceremony was held on 31st March, 1995 at the location for the first restaurant at Ironshore, Montego Bay, prior to the commencement of
construction which ceremony was again attended by a wide cross section of the Jamaican community, members of the press and a Minister of Government. Since that time, the opening of the Plaintiff's
restaurant in the month of September 1995, has been extensively advertised in Jamaica. Such advertising included the erection and maintenance of four billboards, as well as, the periodic placement of written advertisements in Jamaican newspapers.
Since March, 1995, the Plaintiff has proceeded to construct a building upon the land at Ironshore, Montego Bay to be the premises of the first restaurant and the crew and management team necessary to operate the restaurant have been employed. The management team, a group of 5 Jamaicans, were sent to Southern Florida for a period of 3 months to undergo formal training.
Additionally, the employees who will be the core crew of the restaurant were sent to Trinidad &
Tobago to train in a McDonald's restaurant located in that country for a period of 3 weeks. To date, over US$1,200,000 has been spent in preparation for the opening of the restaurant in Jamaica.
Following the Plaintiffs announcement of its intention to open restaurants in Jamaica, the Plaintiff became aware that the Defendants had begun to renovate the building at 1 Cargill Avenue with the intention of re-opening the defunct restaurant. Photocopies of an advertisement placed into the Sunday Gleaner newspaper dated 9th July, 1995 in which the Defendants sought applications from persons interested in employment in the Defendant's restaurant, are exhibited and annexed hereto and marked with the letter 'L' for identity. Further in coincidence with the publicly announced opening on 28th September, 1995 of the Plaintiff's restaurant at Ironshore, Montego Bay, the Defendants restaurant has opened on or about 26th September, 1995.
Also exhibited and annexed hereto marked with the letter 'M' for identity are photographs of the said building at 1 Cargill Avenue and showing the signs "McDonald's" and the banner "Reopening Soon McDonald's Fast Food", taken prior to the re-opening of the Defendants'
restaurant, as well as, photographs of the interior of the Defendants, taken after re-opening of the restaurant. In particular, it is to be noted that the Defendants have altered the previous signs and get-up to delete the knife, fork and spoon which were depicted in all the Defendants' previous signs and that the Defendants' use of the 'M' in the word McDonald's remain similar to and a colourable imitation of the arched 'M' which appears in the Plaintiffs signs and registered trade marks and particularly, the Plaintiffs corporate logo which is registered as trade marks in Jamaica.
The Defendants have also altered the manner and get-up of their operations to imitate that of the Plaintiff; as revealed by the exhibited photographs of the interior of the Defendants' re-opened restaurant, the Defendants, previous operations which were principally that of a sit down
diner and drive in restaurant has been altered to one of a take out or fast food facility in keeping with and similar to the Plaintiffs restaurants. The Defendants' current get-up, such as its menu display also attempts to imitate the Plaintiffs get-up and logos, for example, by referring to the food items using the prefix "McD" which is a colourable imitation of the Plaintiffs get-up and menu displays which refer to many food items using the prefix "Mc" such as, "McChicken", "Chicken McNuggets",
"McPlzza" and "Egg McMuffin" to name a few.
By the matters hereinbefore set out, the, Defendants are deliberately passing-off their business as one that is affiliated with the Plaintiff and in particular by the aforesaid signs which appear on the building at 1 Cargill Avenue, by the Defendants' use of the names "McDonald's" "McDonald's
Corporation" and "McD" in their advertisements, signs and get-up and by opening their restaurant timed to coincide with the opening of the Plaintiffs first authorized restaurant in Jamaica, the Defendants are thereby intentionally, wrongfully and falsely representing to the public that their
restaurant is associated with the Plaintiff.
Members of the public, including foreigners, will thereby be induced to purchase the Defendants, food products in the belief that such products are that of the Plaintiff and are made in accordance with the strict standards promulgated by the Plaintiff in order to maintain the integrity of its franchise system and the goodwill associated with its name and trademarks.
The Plaintiff has in fact granted no permission or licence authorizing the Defendant to use its name or trademarks or any colourable imitation thereof or in any way to represent and pass-off the Defendants' business and food products as being associated with that of the Plaintiff. The use of the name "McDonald's" by the Defendants in a manner to imitate the Plaintiffs name and trademarks will confuse and deceive persons in Jamaica who are aware of the fact that the Plaintiffs
restaurants are opening in Jamaica, and will also confuse and deceive those persons in Jamaica who are customers of the restaurants located abroad that are operated by the Plaintiff and its licensees.
The Plaintiff has also been advised by its Jamaican attorneys that the Defendants' use of the word "Corporation" in association with the name "McDonald's" in order to form the First Defendant's name also evidences the Defendants' intent to confuse and deceive the public, as the use of the word "Corporation" is an Americanism not commonly found in the names of Jamaican companies.
In light of the reputation and goodwill which the Plaintiff has gained internationally and in Jamaica through the operation of numerous McDonald's restaurants throughout the world and the extensive use and advertisement of the Plaintiffs trade name, trademarks, logos and get-up, which have become distinctive of the business operated and the products and services sold at the restaurants operated by the Plaintiff and its licensees, and having regard to the fact that the Plaintiff has announced and extensively advertised and promoted the opening of their first restaurant in Jamaica, the acts of the Defendants in using signs and advertisements bearing the name "McDonald's" and using an arched "M" that is a colourable irritation of the Plaintiffs registered trademarks are acts calculated to deceive the Jamaican public and are likely to cause confusion in the minds of the Jamaican public and other persons on the island who are familiar with the restaurants operated by the Plaintiff and its licensees and the food sold and service rendered at those restaurants.
Such confusion is likely to lead to the loss of goodwill and damage to the Plaintiff, if, as is likely, the food products which will be sold by the Defendants' restaurants are not of the quality offered by that of the restaurants operated by the Plaintiff and its licensees.
In that regard, the Plaintiff enforces stringent standards and specifications in order to maintain the quality of the food sold and the service provided by the restaurants operated by the Plaintiff and its licensees. The Plaintiffs standards govern, among other things, the design and construction of its authorized restaurants, the restaurant signage, seating, decor and equipment, the quality of the raw products used in the production of food sold at the restaurants, the quality and design of packaging materials, the maintenance of proper sanitary, aesthetic facilities, the quality and manner of preparing and handling the food served, the training of the management and crew of the restaurants, all of which are periodically reviewed and tested by employees of the Plaintiff and its and