NEW YORK -- FDX Corp.'s Federal Express, which invented the overnight shipping business, has lost a bid to stop two upstate New York coffee houses from selling java under the name Ex Federal Espresso.
The U.S. Court of Appeals for the Second Circuit in New York on Wednesday said it was unlikely that consumers would confuse Federal Express -- "a vast organization, operating in 210 countries, employing 140,000 persons, and grossing more than $11 billion annually" -- with the coffee shops. Ex Federal Espresso -- which before 1997 called itself Federal Espresso -- has three employees in two stores in Syracuse, New York."The principal products -- coffee and overnight delivery service -- are dissimilar," the court wrote. "There would seem to be little likelihood of confusion."
Anna Dobbs, co-owner of the coffee shops, added, "No one has ever tried to ship a package from here."
The appeals court upheld a lower court's refusal to issue a preliminary injunction against Ex Federal Espresso, in part because the shipping company would not be irreparably harmed by the coffee shops' use of the name.
But the unanimous three-judge panel also said that Federal Express may win at a subsequent trial, noting that Dobbs originally selected the name Federal Espresso because it called to mind the worldwide shipper, among other reasons.
The suit has taken on a David-and-Goliath flavor in Syracuse, attracting widespread attention.