MillerCoors (beer maker of Coors Light and Miller Lite) and Anheuser-Busch (“AB”) (competing beer maker of Bud Light) have been embroiled in a contentious federal district court litigation in the W.D. of Wisconsin since March 2019. MillerCoors filed a lawsuit against AB for false advertising and trademark dilution shortly after AB aired an ad during Super Bowl LIII saying that MillerCoors uses corn syrup during brewing. MillerCoors’ lawsuit alleges that this ad was part of a “false and misleading advertising campaign” designed to deceive consumers into thinking they will consume corn syrup if they drink Coors Light and Miller Lite, which MillerCoors denies. READ MORE
On October 6, 2017, a federal jury in Utah entered a $2.1 million trade secret verdict in favor of Bimbo Bakeries USA. Following a trial that wrapped up more than four years of litigation, the jury concluded that defendant Leland Sycamore knowingly used the trade secret recipe for Grandma Sycamore’s bread in the production of rival Grandma Emilie’s bread for defendant US Bakery, despite the fact that he had previously sold the rights to Grandma Sycamore’s to Bimbo.
Bimbo filed suit in 2013, alleging that US Bakery had hired Sycamore to produce a new version of Grandma Emilie’s bread that relied on Bimbo’s trade secret method and used confusingly similar packaging to sell the bread to consumers.
Back in 1998, Sycamore sold the Grandma Sycamore’s brand, which had been in his family since the 1970s, to a predecessor of Bimbo. As part of this deal, Sycamore agreed to maintain the confidentiality of all associated manufacturing and assembly procedures, recipes and trade secrets.
Other than the fact that jury verdicts in trade secrets cases (or in any case, for that matter) are relatively rare, this case is notable for two reasons.
First, it explains what might qualify as a trade secret in the culinary arena, providing clarity in an area that, as we’ve observed, has long been plagued by confusion over what combination of IP protections and contractual agreements will protect valuable recipes. Applying Utah’s enactment of the Uniform Trade Secrets Act, the court denied the defendants’ motion for summary judgment, noting that, even if Bimbo’s purported trade secret contained known elements, Bimbo could establish a trade secret by showing that its compilation of known elements was “outside the general knowledge and not ascertainable by proper means.”
Second, this case is an interesting reminder that even though a secret process might originate within a business, that same business may face legal risks down the road for using the process if it has been licensed or sold to a third party with the appropriate safeguards to ensure confidentiality and the third party’s right to use the process.
In a dispute over ripped off recipes, counsel for victorious plaintiff Dalmatia Import Group hailed the jury verdict as the first of its kind under the Defend Trade Secrets Act, as we previously reported. Not so fast, sulked the defendants, Dalmatia’s erstwhile manufacturer Lancaster Fine Foods and distributor FoodMatch, in a filing this month. While acknowledging their defeat under the Pennsylvania Uniform Trade Secrets Act, the defendants nevertheless urged the court not to enter judgment under the DTSA.
In recent years, the craft beer craze has taken ahold of the country and has resulted in an explosion of new microbreweries and enthusiasts. Several websites, like BeerSmith, allow users to share recipes with others; other websites, like BrewCraft, sell their recipes for home brewing. In fact, some craft beer aficionados have even created beer trading exchanges to secure their hard-to-find favorites. Even when a popular beer is discontinued, other microbrewers look to fill the void left on everyone’s taste buds with beers of their own. For instance, when Russian River’s legendary craft brew Pliny the Elder was pulled from certain markets, craft brew fans raced to find similarly tasting alternatives to quench their thirst.
To qualify as a trade secret under either the UTSA or the DTSA, the information in question must not be “readily ascertainable” through “proper means.” But what does “readily ascertainable” mean? If information is ascertainable by the public, but it would take some work to compile it, does that qualify as “readily ascertainable”? READ MORE
As many TSW readers are aware, 2016 has been a big year for trade secret law, with both the United States and the European Union expanding trade secrets protections and increasing the uniformity of their laws. But as good as this year has been for trade secrets protection, it’s been every bit as bad for noncompete agreements.
While they say that a grand jury could “indict a ham sandwich,” the First Circuit recently reminded chefs that you can’t copyright a chicken sandwich. Specifically, a former employee of a Puerto Rican Church’s Chicken franchisee sued the franchisee for copyright infringement for the recipe to the “Pechu” sandwich, a sandwich he and his wife claimed to have created in the late-80s . After hunting and pecking over the relevant authorities, the First Circuit clucked in disapproval, reminding the culinary world that the recipe for the sandwich at issue, no matter how tasty, is not copyrightable. READ MORE
Congress is getting into the non-compete business. Citing the use of non-compete agreements by companies such as Jimmy John’s sandwich shops, Senate Democrats recently introduced a bill—called the Mobility and Opportunity for Vulnerable Employees (MOVE) Act—that would amend the Fair Labor Standards Act (FLSA) to prohibit the use of non-compete agreements for low-wage employees. READ MORE
From Minnesota comes a delicious reminder that the protection of trade secrets requires consideration of a company’s entire intellectual property strategy. Without such a comprehensive strategy, in the most prosaic of terms, a company’s bacon is cooked.
Unitherm Food Systems, Inc. designs and manufactures equipment used to process and cook meat. It claims to have invented a revolutionary process to prepare pre-cooked sliced bacon that closely resembles the bacon you’d get from traditional pan frying. You can watch this mouth-watering process in action here. Unitherm treated this process as a trade secret.
Should restaurateurs wonder eachtime they hire someone: Will this person steal their recipes — the bread and butter of their business?
Trade secret law offers limited comfort. Restaurant owners who have pursued such recipe bandits on trade secret misappropriation grounds have a mixed win-loss record. And like a fine paring knife, trade secret law can cut two ways: while it can help protect intellectual property, enforcing these laws in the restaurant business may also drive talent away. Would Michelin restaurant SPQR’s executive chef Matthew Accarrino have joined if he had been required to sign an employment agreement stating that any recipes developed during his employment become the intellectual property of the restaurant? Probably not. READ MORE