A Texas federal court has rejected the argument that the founders of Gina’s Italian Kitchen infringed New York Pizzeria, Inc.’s (NYPI’s) trademark flavor in its Italian dishes. New York Pizzeria, Inc. v. Syal, No. 13-335 (U.S. Dist. Ct., S.D. Tex., order entered October 20, 2014). NYPI alleged that its former vice president and his business partner stole trade secrets, including recipes, and used them to infringe NYPI’s distinctive flavors and plating methods at their new restaurant, Gina’s Italian Kitchen. They allegedly obtained a franchisee’s username and password and used it to log onto NYPI’s franchisee website, which held, among other things, recipes for NYPI’s menu items. The court refused to dismiss the claims for violations of the Computer Fraud and Abuse Act and the Stored Communications Act stemming from alleged access to the franchisee website. The court then addressed NYPI’s Lanham Act claims. Asserting that “no special legal rule” prevents the…
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Adopting a magistrate judge’s recommendation, a Texas federal court has ruled that Texas can intervene in a lawsuit brought by brewer Alamo Beer Co. alleging that Old 300 Brewing infringed Alamo Beer’s trademark for using the silhouette of the Alamo building on its labels. Alamo Beer Co. LLC v. Old 300 Brewing LLC, No. 14-285 (W.D. Tex., order entered October 14, 2014). The state of Texas filed a motion to intervene in April 2014, asserting that its interests in the Alamo trademark were not adequately represented by either party. A magistrate judge issued a report on the matter in May recommending that Texas be allowed to join the lawsuit, and Alamo Beer argued to the court that the magistrate judge had failed to properly analyze two factors of mandatory intervention and that the state lacked the right to intervene under trademark law. Reviewing Alamo Beer’s concerns, the court rejected its arguments and…
Texas has filed a motion to intervene in Alamo Beer Co. LLC’s trademark infringement suit against Old 300 Brewing LLC, asserting that the state has the rights to the “Alamo” mark. Alamo Beer Co. LLC v. Old 300 Brewing LLC, No. 14-285 (W.D. Tex., motion filed April 28, 2014). Filed in March 2014, Alamo Beer’s original complaint alleged that Old 300 Brewing (doing business as Texian Brewing Co.) infringed on its mark by using the silhouette of the Alamo on Texian beer labels, which image Alamo Beer has used and federally registered as a trademark for beer labeling since 1997. Texas argues that it has registered and common law rights to the use of the Alamo Mission’s likeness in commerce. In 2013, the state began registering the Alamo silhouette in a variety of categories, including blankets, apparel, jewelry, leather goods, digital media, packaged foods, and museum services. In the category…
The Consumer Advocacy Group, Inc. has filed a series of Proposition 65 (Prop. 65) 60-day notices since December 2013 against supermarkets and rice companies in California, Texas and Taiwan, alleging violations of the law for failure to warn consumers that their rice products contain arsenic (inorganic arsenic compounds), known to the state to “cause both cancer and reproductive toxicity.” The most recent notice was filed February 17, 2014. Under Prop. 65, private citizen enforcers must notify the alleged violator and local prosecuting authorities of their intent to sue so that the alleged violator has the opportunity to correct any alleged violation and local district attorneys have the opportunity to bring government action. The first in this series of notices, brought against Far West Rice, Inc., also alleged that the company’s rice contained lead. Issue 514
A Texas Court of Appeals has affirmed a lower court’s grant of the defendants’ summary judgment motion in a legal malpractice action brought by a mushroom distributor, finding that he failed to prove lost profits as to his negligence claim and filed his breach of fiduciary duty claim too late under the applicable statute of limitations. Thomas v. Carnahan Thomas, LLP, No. 05-11-01615-CV (Tex. Ct. App., 5th Dist., decided February 5, 2014). The defendants represented mushroom distributor Stuart Thomas and provided legal advice as to one of the ongoing disputes he had with the company that produced the mushrooms he distributed. Among other matters, the attorneys told Thomas he could violate non-compete agreements in his distribution and employment contracts and also unsuccessfully represented him in handling his declaratory judgment action as to the non-compete agreements. The court agreed with the attorneys that Thomas had no evidence of lost profits because…
Texas and California residents have filed a putative class action against Whole Foods Market Services, Inc. in a Texas federal court, alleging that the company’s private label lines include falsely labeled additive-laden and genetically modified (GM) foods, despite promises that its products contain “nothing artificial” and that it enforces “strict quality standards.” Gedalia v. Whole Foods Mkt. Servs., Inc., No. 13-3517 (S.D. Tex., filed November 28, 2013). Among purported transgressions are (i) organic infant formula containing 25 ingredients “prohibited from being in organic foods” as well as 30 artificial ingredients, and (ii) organic soy and almond milk containing “ingredients not permitted in organic foods.” The complaint also alleges that the company reneges on its promise to avoid ingredients grown from genetically engineered seed and relies on a Cornucopia Institute study purportedly showing that Whole Foods’ 365 Everyday Value® products “were contaminated with high levels of genetically engineered ingredients,” citing, in particular,…
Austin-based Amy’s Ice Creams has reportedly filed a trademark infringement lawsuit in a federal district court against Amy’s Kitchen, which makes frozen lunch and dinner entrées with organic and non-genetically modified ingredients. While the two companies have apparently co existed without difficulty for more than 20 years, Amy’s Ice Creams, now with 15 shops throughout Texas, claims that it recently learned about the frozen food company’s plan to launch a line of frozen treats. Amy’s Kitchen is based in California, and its products are sold nationally. Ice cream company founder Amy Simmons reportedly said, “We don’t want them to go into ice cream because there will be obvious confusion.” According to the complaint, the confusion would not be limited to Texas consumers, as the ice cream company “is well known beyond the state. The success of Amy’s [Ice Creams] has been featured in such publications as Inc., Southern Living, Wall…
SHB’s Public Policy Group recently contributed to a favorable outcome for animal medicine manufacturers in the Supreme Court of Texas, which ruled in Strickland v. Medlen that emotion-based damages, including loss of companionship and sentimental damages, are not permitted in pet injury claims in Texas. Presenting on behalf of amici during oral argument, SHB Partner Victor Schwartz highlighted the public policy issues at stake after a lower appellate court in Texas broke with the majority of courts nationally by allowing broad, new emotion-based damages for pet deaths in a November 2011 ruling. SHB Partner Phil Goldberg authored the amici brief on behalf of the Animal Health Institute and several animal health organizations, developed other amici and helped prepare defense counsel on key issues, while Partner Manuel Lopez served as local counsel on the SHB amici brief and provided expertise on the appellate process. In its ruling, the court ultimately recognized that finding…
According to news sources, a federal jury in Texas has determined that Ralcorp Holdings, which makes bowl-shaped tortilla chips sold as store brands, did not violate trademarks or infringe patents on an allegedly similar product made by Frito-Lay and sold as TOSTITOS SCOOPS!®. Frito-Lay N. Am., Inc. v. Medallion Foods, Inc., No. 12-00074 (E.D. Tex., decided March 1, 2013). Additional information about the lawsuit can be found in Issue 427 of this Update. Frito-Lay had sought an order requiring that the defendant cease making BOWLZ® and CUPZ® chips and $4.5 million in damages. See Businessweek, March 4, 2013; The Kansas City Star, March 5, 2013.
Rep. Joe Farias (D-San Antonio) has proposed a bill (H.B. 779) that would impose a statewide penny-per-ounce tax on soft drinks, particular sweetened beverages and the powders and syrups used to make them. The tax would increase each year by the same percentage as the “most recent annual revised Consumer Price Index for All Urban Consumers.” The legislation, which purportedly aims to fight obesity and supplement funding for health programs in public elementary and secondary schools, calls for 80 percent of the tax revenue collected to go to the Texas Education Agency and 20 percent to the Department of State Health Services. The proposed tax would apply to all nonalcoholic, carbonated and noncarbonated beverages and mixes that contain natural or artificial sweeteners. Exceptions to the tax would be certain sports drinks, 100 percent fruit and vegetable juices, infant formula, milk products, and beverages containing sweeteners that do not add calories.…
