Don't Trade Dress that Sandwich!
Students at George Washington University returned to school to find that an on-campus sandwich shop had a new name. The former Coggins’ Sandwich Manufactory is now a franchise of Potbelly Sandwich Works. The change came after a lawsuit accused Coggins of infringing Potbelly’s “trade dress.� Basically, Potbelly said Coggins’ store looked too much like a Potbelly store, even though they adopted a different name and there was no genuine public confusion that the two companies were separately owned.
Among the alleged elements of Potbelly’s trade dress are “floors made of natural wood and concrete�, “tin panel ceilings�, “chalkboard-style menu boards�, and a “barrier separating customer line from order counter with entry point at ordering station�. Coggins incorporation of these elements, among others, constitutes a Lanham Act violation, according to Potbelly, because they apparently came up with these ideas first. Or at least they thought of using lawyers to prevent competition first.
Coggins “settled� the lawsuit by agreeing to shut down its sandwich shops. The judgment filed with the court broadly prohibits Coggins and its corporate owners from operating “any restaurant where sandwiches account for 25 percent or more of its gross sales�. The defendants may, however, sell hamburgers, provided they are “not cooked or warmed in a toaster oven or served on hoagie, hero or sub-style rolls�. (What about grinders?)
The judgment actually lists 31 distinct “trade dress� elements, and according to Potbelly, incorporating a majority of these infringes their trademark. Taken to its logical conclusion, this means that Potbelly could prohibit any business from actually purchasing a majority of those elements—i.e., natural wood floors and chalkboard menus—so as to prevent potential infringement.
Comments (2)
This is not new. A few years back Taco Cabana sued its competitor Two Pesos for trade dress infringement. They both had a "pink-and-green color scheme," you see! Taco Cabana won its argument that Two Pesos had copied "look and feel" of Taco Cabana restaurants. Disgustingly, Taco Cabana won, which basically gave it ownership of the Two Pesos chain. As I recall, much of this dispute was based in Houston, which is not a stranger to landmark or notable trademark disputes. Another was the Tour 18 case where Pebble Beach and other famous golf courses sued Tour 18, a local golf course that had reproduced some famous courses from around the world. Yet another was a local dive, a bar called The Velvet Elvis, here in Houston. Sued by the estate of Elvis Presley, it was forced to change its name to The Velvet Melvyn. Sad. Patent and copyright law are not the only dangers.
Published: September 24, 2006 11:43 PM
This dangerous rubbish could _only_ have occurred under legislation. Hayek also warned against the dangers of treating 'trademarks' & the like as private property as long ago as 1947: "...a mechanical extension of the property concept by lawyers has done so much to create undesirable and harmful privilege" -- ' "Free" Enterprise and Competitive Order' in Individualism and Economic Order, p. 114. Earlier on the same page he says, "In the field of industrial patents we shall have seriously to examine whether the award of a monopoly privilege is really the most appropriate and effective form of reward for the kind of risk-bearing which investment in scientific research involves."
Published: September 25, 2006 8:25 AM