Pepperidge Farms Sues Trader Joe’s: That’s The Way The Cookie Crumbles!

Norwalk, Connecticut based Pepperidge Farm, a division of Campbell Soup Company, has brought suit against Trader Joe’s Company, accusing the popular Monrovia, California grocery store chain of trademark infringement over a product called Crispy Cookies that it says too closely resembles both the look and package design of Pepperidge Farm’s iconic Milano cookies — a line of oval-shaped sandwich cookies with chocolate filling. Pepperidge Farm accuses Trader Joe’s of deceptive marketing, confusing customers and diluting the value of its Milano cookie product, according to a complaint filed last week in Connecticut federal district court.

The Milano cookie, which Pepperidge Farm first sold in 1956, consists of chocolate filling, and sometimes other flavors, sandwiched between two oval-shaped cookies.  But, Pepperidge Farm did not trademark its formula until 2010.  Still, the Company says it has generated “hundreds of millions of dollars” in Milano cookie sales in the last ten years.  According to the complaint Trader Joe’s version of the cookie was more rectangular but had rounded edges, “mimicking an overall oval shape.”  The complaint also accuses Trader Joe’s of using similar packaging.  The complaint claims that “Trader Joe’s has willfully sought to trade on Pepperidge Farm’s reputation and the reputation of the Milano cookies”.  Pepperidge Farm first notified Trader Joe’s of potential trademark infringement in August and the company seeks compensatory and punitive damages along with attorneys fees and to block future sales of the Trader Joe’s cookie.

Pepperidge Farm is a commercial bakery founded in 1937 by Margaret Rudkin, who named the brand after her family’s property in Fairfield, Connecticut, which in turn was named for the pepperidge tree. Trader Joe’s is an American privately held chain of specialty grocery stores  founded in 1958 in Monrovia, California.   As of 2015, Trader Joe’s had 457 stores, approximately half which are in California, with the heaviest concentration in Southern California. The company also has locations in 40 other states including here in Boston, Massachusetts.  It is a market leader in organic and fresh food groceries in the United States.  Trader Joe’s was founded by Joe Coulombe and has been owned since 1979 by a German family trust established by Aldi Nord’s owner Theo Albercht.

But, can a recipe for a cookie be subject to intellectual property protection?  A recipe is basically a process for creating an edible product.  The U.S. Trademark Act does not provide protection for food creations per se.  Instead, trademark law protects brand names, designs and other elements of food products, and trade dress law protects the design, shape, color, packaging and appearance of food products, solely to the extent that they identify the source and origin of a unique or distinctive product.  A trademark is a legally protected word, name, design, logo, or other symbol of a product or business that prevents others from using or selling a similar product under the same name.  However, in addition to identifying the source and origin of the owner’s products, trademarks and trade dress must also have distinctive character to be eligible for registration and protection. Trademarks and trade dress are deemed to be “inherently distinctive” if they immediately communicate to a consumer that they are identifying the source and origin of a product, as opposed to describing the product itself.

Distinctiveness may be acquired through “secondary meaning,” a process whereby over time consumers come to recognize the trademark as a source identifier. Trade dress protection of packaging may be acquired through inherent distinctiveness or secondary meaning.  The key is whether consumers find the trademarked characteristic to be distinctive and uniquely associated with a particular product or brand.  If competitors could use it to trick consumers into thinking they’re buying your product, chances are it may be trademarked.  What trademarks don’t do is protect recipes or formulations. One cookie may be better than the one next to it on the shelf, which is why consumers decide to purchase it– but the trademark only protects the product’s name, logo, or the design on the package, not the recipe itself.

But, can the recipe for a cookie or other baked product be protected?  Patents may be granted for any “new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof” according to Title 35 of the United States Code, Section 101.  A food product or recipe typically has three components: 1) a list of ingredients, 2) instructions on how to combine and cook them, and 3) the final product resulting from the first two components. In terms of patentable subject matter, a list of ingredients can fall under the headings of a composition of matter and/or manufacture, and the way the food product is produced can fall under a process.  So the short answer is yes, recipes may be eligible for patent protection because they potentially contain patentable subject matter.

However, to be patented an invention must also be “novel” and “nonobvious,” as defined under Title 35 United States Code, Sections 102 and 103.  That means a patentable invention can neither have existed before, nor be an obvious improvement or alteration of a previously known invention, which could be determined by someone with reasonable skill in the art encompassed by the invention. This is where patenting a recipe gets a lot trickier.

We have been mixing together various ingredients to produce different food products since the dawn of civilization.  In fact, some of the earliest known examples of written language are food recipes. Therefore, most “new” recipes are merely combinations of known ingredients in varying amounts, separate discoveries of preexisting recipes, or variations on known recipes. Even if a previous version of a recipe cannot be found, a “new” recipe could still be considered obvious and therefore not subject to intellectual property protection.

Cooking is basically chemistry.  Typically, a cookie is nothing more than the expected sum total of individual components.  For example, the more sugar is added, the sweeter the taste.  Similarly, a special ingredient may result in a unique flavor, texture or crunchiness, but not an unexpected result.  However, there are exceptions in which the combination of ingredients used, or the way in which they are processed, results in a food product totally unique or different which may be patentable and many patents on such food products are issued each year.  However, most of these like substitutes for sugar, salt or fat involve recipes that are more likely to have been created in a laboratory than in a kitchen.

A trademark or patent isn’t the only way to acquire intellectual property protection for food products.  Companies also often use trade secrets to protect proprietary recipes and production processes.  But trade secrets differ considerably from trademark or patent protection in a number of ways.  With a trade secret, inventors do not disclose the inner workings or formula of the invention, and employees or collaborators usually sign non-disclosure agreements that prevent them from sharing the recipe.  Many food companies like Coca-Cola, Dr. Pepper, and Kentucky Fried Chicken choose to use trade secrets to protect their recipes and methods because it allows them to use the secretive nature as a marketing tool.  The recipes for are all trade secrets, and each company has, at some point, used that secret as a part of their advertising campaigns.

While imitation is the sincerest form of flattery, if the two sides cannot work out their differences, this case could leave a bad taste in everyone’s mouth – and that may be the way the cookie crumbles.