The Kellogg Company recently filed a trademark infringement suit in the Federal Court for the Northern District of Ohio. You probably assume this concerns some multi-national competitor who's using Tony Tiger or the Rice Krispie "Snap, Crackle and Pop" elves in some infringing manner. But you would be wrong.
The subject of this lawsuit is a food truck operating in Findley, Ohio called "L'Eggo My Eggroll." It's the opposite of a multi-national entity. It may not be multi-county for all I know. But it got on Kellogg's radar, and now the food truck is a defendant in a trademark infringement suit.
I have to say, my first reaction when I read about the case was that Kellogg was being a bully. Is some tiny food truck on a corner somewhere in Findley, Ohio really a threat to a $15 billion entity like Kellogg? The obvious answer is no. So, what is Kellogg's objective here?
There are likely several issues that led Kellogg to file the suit. First, there is at a small risk the consumers could conclude that there was some connection between Kellogg and the truck. The logo on the truck says "L'Eggo My Eggroll." Using the capital "E" and the apostrophe clearly evokes the Kellogg trademark. In addition, the truck is yellow and the words are red, in a script that is very similar to the Eggo packaging. So, if a consumer has a bad experience at the truck, do they assume it was Kellogg? It's possible.
There are also the concepts of "dilution" and "tarnishment" to consider. Dilution of a trademark occurs when other parties use the famous trademark in a way that diminishes the connection with the original product. Tarnishment occurs when the famous mark is used on an inferior product in a way that confuses consumers. In other words, does Kellogg want consumers to think that it's in the food truck business? Apparently not.
And it's worth reading the complaint to get a fuller picture of this dispute. Kellogg attached to its complaint letters it sent to the food truck operators where it demanded that the food truck stop using the L'Eggo mark. As demand letters go, they are remarkably not heavy handed. Kellogg demanded that the food truck stop using the mark, but it didn't ask for any money. Indeed, Kellogg offered to pay the food truck $5000 to offset the cost of complying with the demand.
Viewed in this context, it's hard to understand the food truck's refusal to settle. Let's not lose sight of the fact that "intellectual property" is property. If the food truck had taken an Eggo billboard and painted "Eggroll" over it, would anyone have a problem with Kellogg demanding it be returned? So, why apply a different standard to intangible property? The food truck can't say with a straight face that it was entitled to use the logo and the tag line. Its best defense is "hey, what's the big deal?" That is not an optimal litigation strategy.
And here’s the hard truth. Kellogg has brought down the hammer with its complaint. It's not just demanding that the food truck stop using the mark. It's upped the ante significantly. Among other remedies, Kellogg is seeking to recover "all gains, [and] profits" the food truck derived from its use of the Eggo mark. Under federal law, Kellogg has the burden to show the profits the food truck made while using the mark. At that point, the burden flips to the food truck to prove the profits had nothing to do with the infringing use. Not an easy task. In addition, Kellogg has asked the court to triple any damages awarded. Kellogg also wants the food truck to pay its attorney fees. That's likely a six-figure sum right there.
Speaking of tag lines, a cigarette company back in the day used the line "I'd rather fight than switch!" That may have worked as an advertisement, but here, it's terrible legal advice. For L'Eggo My Eggroll, it is unquestionably time to switch.
