‘Chicago Mix’: sweet, salty and serious

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Guest columnist and intellectual property attorney Lora Friedemann urges lawyers to talk to their clients about making public statements during litigation. After filing a lawsuit over the “Chicago Mix” trademark, Candyland stirred up trouble by criticizing its opponent. Friedemann is shown in front of a Candyland store at 27 S. Seventh St. in Minneapolis.

The heat is on in a battle that pits small popcorn manufacturer Candyland Inc. against industry giant Cornfields Inc. The kernel of the argument is the term “Chicago Mix.”

Candyland registered the “Chicago Mix” trademark over 20 years ago, and claims that others using the mark are infringers. Cornfields disagrees, and claims that “Chicago mix” is the generic name for a blend of caramel and cheese popcorn. According to Cornfields, “scores of third parties throughout the United States use the generic flavor designation ‘Chicago Mix’ to describe the same combination of caramel and cheddar flavored popcorn.” Cornfields sells a line of flavored popcorns under the G.H. Cretors® brand. The line includes a blend of caramel and cheese corn called “Chicago Mix.”

After filing the lawsuit, Candyland stirred up trouble by criticizing its opponent. Among other unflattering comments, Candyland posted that Cornfields is out to “steal the trademark and use it at their discretion, punishing the entire nation with overpriced, bad tasting, unappetizing, tainted mixtures of popcorn.” Candyland’s statements resulted in counterclaims for defamation, unfair competition and false advertising.

Bite off only what you can chew

The case highlights two lessons for litigants. First, when you file a trademark-infringement lawsuit you place your trademark at risk. Your opponent will look for ways to challenge your trademark, and will aggressively pursue any vulnerability. The trademark “Chicago Mix” is being challenged by Cornfields as generic.

A generic term refers to an entire class of products, and does not distinguish the trademark owner’s product from those of its competitors. Generic terms are not eligible for trademark protection. A mark can become generic if the trademark owner fails to enforce it or uses it improperly. A mark can also become generic through changes in consumer perception independent of the trademark owner’s conduct. A registered trademark may be canceled at any time if the mark ceases to serve as a source-identifier and has instead become the generic name for a class of goods or services.

Famous brands that have stared into the genericism abyss include Kleenex®, Xerox® and Rollerblade®. These trademarks risked becoming generic because customers began to understand them as the thing itself, rather than a brand name.

Candyland risks losing the “Chicago Mix” trademark for the same reason. Although the mark may have served as a source-identifier when Candyland first coined it, many people think of “Chicago Mix” as a blend of caramel and cheese popcorn regardless of whether it is made by Candyland, Cornfields or any other manufacturer. If Cornfields succeeds in showing that the mark has become generic, Candyland will lose the lawsuit and its trademark registration.

Seal your lips

In addition to popping its trademark bubble, Candyland may face liability for the statements it made about its opponent. Cornfields asserted counterclaims for defamation, unfair competition and false advertising based on statements Candyland allegedly made on its website and in blog posts. In addition to calling Cornfields and other manufacturers “corporate sharks” and “shameful companies” out to “steal the trademark and use it at their discretion,” Candyland called the products “overpriced,” “unappetizing,” “tainted,” and “inferior.”

Judge Richard H. Kyle addressed the counterclaims in response to Candyland’s motion to dismiss. The court considered each statement separately and evaluated whether the statement was capable of being proven false. (To state a viable claim for defamation, a statement must be false, communicated to someone other than the claimant, and harm the claimant’s reputation.)

According to the court, claims that the opponent’s popcorn was “overpriced,” “unappetizing” and “inferior” are statements of judgment that cannot be empirically verified, and therefore not actionable. Somewhat surprisingly, the court also rejected claims based on Candyland’s assertion that its opponents’ popcorn was “tainted.” Taken in context, the court held that the statement “emphasizes Candyland’s disrespect for the general quality” of the popcorn, not that the popcorn was rotten or spoiled.

The court reached a different conclusion with respect to Candyland’s assertion that Cornfields “stole” the “Chicago Mix” trademark. Unlike the prior statements, the court found that the assertion that the Cornfields “stole” the trademark is capable of being proven false and, indeed, is a key issue that will be resolved in the lawsuit. Although not as inflammatory, an assertion that an opponent is “infringing” is also capable of being proven false, and is the central issue in many trademark cases.

The takeaway: Talk to your clients about making public statements during litigation. The First Amendment right to petition the government protects statements contained in pleadings and briefs from defamation claims. The same is not true for out-of-court statements. A defamatory statement made about an opponent may increase the cost of the litigation and, if successful, result in liability.

A taste of sweetness for Candyland

At the same time it sued Cornfields, Candyland also sued CaramelCrisp LLC, better known as Garrett Popcorn Shops, and Snyder’s-Lance, Inc., owner of the O-Ke-Doke brand. Garrett’s quickly agreed to stop using the “Chicago Mix” designation. According to news accounts, Garrett’s agreed to stop using the name “Chicago Mix” in favor of the more ownable “Garrett Mix.” Snyder’s-Lance agreed to stop using the phrase by July 2016 to resolve the lawsuit Candyland filed against it.

If Candyland wants to own the phrase “Chicago Mix” for caramel and cheese popcorn, Candyland needs to stop Cornfields from using the phrase, either by convincing the court that its trademark is valid and infringed, or through a settlement. A finding that the mark is generic would leave Candyland with nothing but old maids.

A settlement conference is scheduled in January.

Lora Friedemann is head of Fredrikson & Byron’s Intellectual Property Practice Group. She is one of Fredrikson & Byron’s lead trial lawyers, serving as primary counsel in complex patent, trademark, copyright and trade secret cases. Lora can be reached at [email protected].