Monthly Archives: July 2010

Of Unicorns and Pigs: The Limits of Trademark Infringement

Trademarks create an association in the minds of consumers between specific goods and the source of those goods. Because of this, it’s important for trademark owners to police their marks for misuse by competitors who would profit from the goodwill created by the owner. A common way of enforcing one’s

trademark rights is through the cease and desist letter. But some uses, such as parody, may be a defense to infringement and actually decrease the likelihood of confusion. When the trademark owner ignores this difference and proceeds with a cease and desist letter, the result can be both humorous and embarrassing.

Such was the case with a recent dispute between the National Pork Board and Geeknet, Inc., an online store specializing in novelty items. On April 1, 2010, Geeknet began offering “Radiant Farms Unicorn Meat” for sales on its website www.thinkgeek.com, using the slogan, “Unicorn – the new white meat.” A little over a month later, ThinkGeek received a 12-page cease and desist letter on behalf of the National Pork Board, owner of the internationally registered trademark “The Other White Meat”. In a tongue-in-cheek response in keeping with the April Fool’s Day spoof, Scott Kauffman, President and CEO of Geeknet, issued a public apology to the National Pork Board, stating, “It was never our intention to cause a national crisis and misguide American citizens regarding the differences between the pig and the unicorn. In fact, ThinkGeek’s canned unicorn meat is sparkly, a bit red, and not approved by any government entity.”

According to U.S. Trademark Manual of Examining Procedure (TMEP), parody per se is not a defense to a claim of likelihood of confusion, but there are confusing and non-confusing parodies. A true parody actually decreases the likelihood of confusion by creating a distinction in the consumer’s mind between the actual product and the joke. Unlike a parody mark used on the same goods sold in the same channels of trade (see our earlier blog post, Trademarks & Parodies: The North Face versus The South Butt) the fact that unicorns are mythical creatures makes it less likely that anyone would confuse ThinkGeek’s non-edible novelty item with the edible meat promoted by the National Pork Board.

Parody marks can often be used as an effective way to capitalize on the goodwill in someone else’s trademark. But like the famous quote about cigars attributed to Sigmund Freud, sometimes a parody is just a parody.

The Thomas Muffin Affair: More Than Just “Nooks and Crannies”

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The Third Circuit Court of Appeals recently heard arguments regarding a district court decision in a trade secrets case between Bimbo Bakeries USA, Inc. (maker of Thomas’ English Muffins) and its former executive, Chris Botticella. Many in the popular media dubbed this the “nooks and crannies” case, a reference to the

unique texture of the muffin, to which Botticella had access. In reality, the case involves a much broader spectrum of trade secrets, as well as the enforcement of a confidentiality agreement and the use of computer forensics to detect possible violations of that agreement.

Until January of 2010, Chris Botticella was Bimbo’s Vice President of Operations for California. In this capacity, he was one of less than 12 people at Bimbo with access to a variety of confidential and proprietary information, such as product formulas and process parameters, which were stored on a secure website. Among these trade secrets were the three components (formula, manufacturing, engineering design, and process parameters) that give Thomas’ English Muffins their celebrated texture. With annual sales of about $500 million, the muffins have been a vitally important item in Bimbo’s product line. In order to keep these trade secrets from its competitors, Bimbo compartmentalized this information so that only seven people (among them Botticella) had access to all three components.

But Botticella was also knowledgeable about other sensitive aspects of Bimbo’s business operations. As a company vice president, he was one of only five people with access to Bimbo’s highly confidential cost-reduction strategy for the Western region. This strategy included information about lines and plants to be closed, new processes to be implemented, new products to be launched, and formulas to be optimized.

In March of 2009, Botticella entered into a confidential agreement with Bimbo as a condition of employment. Less than seven months later, in September of that year, he received a job offer from Interstate Brands Corporation, the predecessor to Hostess Brands, Inc., one of Bimbo’s three major competitors. In October 2009, Botticella accepted the position with Hostess, and in December he signed an “Acknowledgement and Representation Form,” stating that Hostess was not interested in Bimbo’s trade secrets, nor would Botticella disclose such secrets to his new employer.

Botticella was to resign from Bimbo on January 15, 2010, but it was not until January 4, 2010 that he informed Bimbo of this intention, and not until about 10:00 a.m. on January 13 that he let Bimbo know that he was going to work at Hostess. He was then told to stop all work and leave that same day. But according to the testimony of a computer forensics expert, at 10:12 a.m. on January 15, Botticella accessed 12 company documents on his laptop computer (including highly confidential Bimbo documents), all in the course of 13 seconds. Computer forensics also revealed that three external storage devices had been attached to the laptop, only two of which have been accounted for. When questioned about this in deposition, Botticella testified that he attached the USB flash drives to the computer as “practice” in order to improve his computer skills for his job at Hostess.

On February 9, 2010, the court entered a preliminary injunction barring Botticella from starting his employment at Hostess and from divulging any of Bimbo’s trade secrets to anyone. He was also ordered to return all of Bimbo’s confidential information in his possession back to his former employer. This injunction was to remain in effect until after the trial, which was scheduled for April 12. But by filing an appeal, Botticcella actually prolonged his unemployment until at least after the court of appeals enters its decision.

It remains to be seen how this case will be decided, but one thing is certain: it’s not just about English muffins

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