Arthur R. Lehman, L.L.C.

Tomato sauce maker abandons product name but learns to prosper

This blog has previously noted the steps that a trademark owner will take to protect the mark. But, what happens to the business that is forced to abandon a successful product name? A tomato sauce maker was recently compelled by a New York restaurant to pick another tradename for its products, but it has found a way to recover from this setback and continue to prosper.

The sauce manufacturer began making tomato sauces in 2010, basing their formulae on old family recipes. The owner of the company chose the name "Nello's" for its sauces because that was his personal nickname. The sauces became very popular, and the company was on the verge of financial success. Unfortunately, an upscale New York Italian restaurant had already registered its name, Nello, and its attorneys sent a letter to the tomato sauce maker demanding that he abandon the use of the name.

After concluding that a full-throated defense of a trademark infringement lawsuit would ruin the business, the sauce maker decided to compromise. He and the restaurant agreed that he could use the name "Nellino's Sauce" if he quit labelling his products as Nello's.("Nellino" is his son's nickname.) The restaurant also agreed that the sauce maker could sell its existing stock of already labeled product and that he could use the legend "formerly Nello's" on product labels. With the trademark dispute behind him, the sauce maker has expanded his product line by adding additional flavors. He has moved production to a regional, green-certified facility that the owner says is a trade secret.

Most people are familiar with the adage that "if life hands you lemons, make lemonade." In this case, the sauce owner accepted what he could not change and began making tomato sauce. Anyone facing a similar challenge to a product or business name may wish to consider consulting an experienced business attorney for advice on the law that governs the case and for an estimate of the likelihood of achieving a favorable outcome.

Source: Charlotte Observer, "When life throws you tomatoes, make tomato sauce," Jill Warren Lucas, May 2, 2017

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