Expanding into Vegetarian Products Lands Starbucks in Hot Water



Starbucks acquired the organic juice maker Evolution Fresh Inc. (“Evolution Fresh”). After doing so, Starbucks devised a business plan to expand both the type of products offered and expansion into restaurants. Specifically, Evolution Fresh began selling various food products, including vegetarian and vegan foods, along with juices at restaurants. Starbucks also launched a new logo for the new business. These actions resulted in vegan food and organic juice restaurant Evolution Fast Foods LLC (“EFF”), based in San Diego, suing Starbucks and the acquired company Evolution Fresh for trademark infringement, contributory infringement and unfair competition.

The marks at issue are Plaintiff’s mark EVOLUTION FAST FOOD and Defendants’ EVOLUTION FRESH, among others. Moreover, both the vegan restaurant EFF and Evolution Fresh (owned by Starbucks) use marks beginning with the lower case letter “e.”

Plaintiff EFF alleges that, to the extent Defendants have any trademark and/or service rights, they are limited to association with fruit and vegetable juices—not restaurant services. Both Plaintiff and Defendant target consumers in the health industry, including those following vegetarian and vegan lifestyles. The expansion into restaurants is alleged to be likely to cause confusion among these ordinary consumers.

Plaintiff alleges that Defendants launched a new logo following Starbucks’ acquisition that is far different and strongly resembles Plaintiff’s mark.  Plaintiff alleges that Defendants adopted the logo “only after learning of the existence of Plaintiff and the intent to capitalize on Plaintiff’s recognition in the health and wellness marketplace…”

Starbucks opened Evolution Fresh stores in places previously occupied by Starbucks stores and sold Starbucks gift certificates at these stores. Plaintiff does not want consumers to be confused that they have an affiliation with Evolution Fresh and Starbucks. This association, Plaintiff contends, will damage Plaintiff’s reputation with its vegan customers because they will wrongfully believe that Plaintiff has lost its dedication to the vegan cause and vegan diet.

The lawsuit was filed last week. Starbucks has not yet answered, but will likely dispute these allegations. It will be an interesting case to follow. Will Starbucks’ new business expansion result in a finding of trademark infringement or not?

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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