Johnny’s Fine Foods v. Johnny’s

Citation: Johnny’s Fine Foods, Inc. v. Johnny’s Inc., 286 F.Supp.2d 876 (M.D. Tenn. 2003).

Factual Background
Plaintiff sold barbeque and other seasonings, salts, marinades, and mustards under the federally registered marks JOHNNY’S, which it used since 1959, and JOHNNY’S LITE, which it used since 1984. Defendant, owned by Johnny Fleeman, sold steak sauce, marinades, barbeque sauce, cocktail sauce, and salad dressings. In 1992, defendant began selling certain products under the name JOHNNY’S out of Mr. Fleeman’s restaurant in Lawrenceburg, Tennessee. Defendant began distributing “Johnny’s Steak Seasoning and Marinade” in grocery stores in Tennessee and Alabama in 1993 and in 1996 expanded to Georgia, South Carolina, and Arkansas.

In 1997, plaintiff contacted defendant several times, noting that defendant’s use of JOHNNY’S was causing confusion as consumers mistakenly attempted to redeem defendant’s coupons with plaintiff. Plaintiff wanted defendant to emphasize its address, change the font, and make other changes to the coupons to avoid this confusion. Defendant responded that it would work with plaintiff to change its coupons and that it would notify plaintiff once it decided on a course of action. Defendant ultimately decided to stop issuing coupons in 1997. During this 1997 time frame, plaintiff apparently did not specifically object to defendant’s use of the mark JOHNNY’S other than in the context of the coupons, and defendant maintained that it had the right to continue using the name JOHNNY’S.

Almost four years later, plaintiff sent a cease-and-desist letter to defendant in March 2001 stating that defendant’s use of the mark JOHNNY’S for identical products violated plaintiff’s trademark rights. In July 2001, defendant dropped the mark JOHNNY’S and instead began marketing its products under the names JOHNNY FLEEMAN’S and JOHNNY FLEEMAN’S GOURMET. However, existing stock with the old name continued to be sold in stores throughout 2001 and on the Internet until February 2002.

Trial Court Proceedings
Plaintiff sued defendant for trademark infringement, dilution, and unfair competition, seeking recovery of defendant’s proceeds from the use of the JOHNNY’S mark, punitive damages, and equitable relief. After a bench trial, the court granted plaintiff’s request for injunctive relief and enjoined defendant’s future use of JOHNNY’S and JOHNNY’S GOURMET, but ruled for defendant on all other issues.

The court first held that plaintiff’s claims were barred based on the affirmative defenses of acquiescence and laches. Laches barred any award of prefiling damages because plaintiff unreasonably delayed in filing suit by waiting over four years to file suit when the relevant state statute of limitations was three years. Moreover, between 1997 and 2001, defendant invested “significant effort and funds in expanding its business using. . . the term ‘Johnny’s,’ all in reasonable reliance on the tacit assurance” by plaintiff’s predecessor that such use was permissible.

The court also ruled in favor of defendant on its affirmative defense of acquiescence and barred injunctive relief, subject to the exceptions noted below, because plaintiff’s 1997 letters sought changes only to defendant’s coupons and did not demand that defendant cease all use of JOHNNY’S. The court rejected plaintiff’s argument that acquiescence was not applicable because defendant progressively encroached on plaintiff’s rights. To the contrary, the court noted that defendant was already in direct competition with plaintiff in 1997, despite defendant’s more recent expansion and increased marketing efforts.

Despite the finding of acquiescence, the court nonetheless enjoined defendant’s use of JOHNNY’S and JOHNNY’S GOURMET because it would lead to “inevitable” confusion between the parties’ products, an exception to acquiescence. Specifically, the court found that plaintiff’s marks were incontestable, the parties’ goods were related, the marketing channels of the parties overlapped, and there was a low degree of consumer care. In contrast, the court held that defendant’s marks JOHNNY FLEEMAN’S or JOHNNY FLEEMAN’S GOURMET were not so similar to the mark JOHNNY’S that confusion between the parties’ products would be “inevitable.”

Finally, plaintiff complained about defendant’s use of the domain name “johnnysgourmet.com” and use of JOHNNY’S as a metatag. Based on the court’s earlier ruling that defendant’s mark JOHNNY’S GOURMET would inevitably cause confusion, the court enjoined defendant from using the domain name “johnnysgourmet.com.” However, because plaintiff failed to introduce any evidence that defendant actually used JOHNNY’S as a metatag and because that term was “so generic and ubiquitous on the Internet,” the court ruled that any confusion caused by use of JOHNNY’S as a metatag would be “negligible at best.”

Indeed, searches for “Johnny’s” on the Yahoo! and Google search engines revealed 251,000 and 157,000 hits, respectively. Plaintiff’s website ranked fifth on the first page of both sets of results whereas defendant’s site was not even listed on the first page. These results did not change even if “Johnny’s” was combined with additional relevant terms like “sauce,” “dressing,” or “seasoning”—plaintiff’s site still ranked higher than the defendant’s in all cases. Even a search for the infringing name “Johnny’s Gourmet” produced similar results. Accordingly, the court did not enjoin use of “Johnny’s” as a metatag.

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