Trader Joe’s Loses TM Battle

For those of you who have been following the heated battle between US-based Trader Joe’s and Canada-based Pirate Joe’s (refer to my previous blog post here), a major decision was handed down in Washington state courts today.  The US court dismissed the action of Trader Joe’s against Pirate Joe’s, stating that no economic harm was done to the grocery food store, and foremost, that the court could not apply US law to a Canadian-based entity.

Judge Marsha Pechman stated clearly in her judgement that, “Even if Canadian  consumers are confused and believe they are shopping at a Trader Joe’s or an approved affiliate when shopping at Pirate Joe’s, there is no economic harm to Trader Joe’s because the products were purchased at Trader Joe’s at retail price.”

While the decision largely focused on conflict of laws and jurisdictional issues, what was also mentioned in the case (and my previous suspicion confirmed) is that Trader Joe’s failed to elicit a judgment on trademark infringement.  Recall that infringement requires that one party uses the trademark of another (or a confusingly similar trademark) to incorrectly link those wares and services to themselves, rather than the original party.  The issue wasn’t completely decided, however.  Judge Pechman stated that any alleged infringement occurred in Canada, not in the US, and therefore the analysis wouldn’t be appropriate in this given case.  However, if the matter were brought forward in Canada, I still doubt Trader Joe’s would succeed on that point.  Pirate Joe’s continually made no effort to hide the fact that they were selling Trader Joe’s products, and in no way infringed upon the trademark.  There was no doubt in consumers’ minds that they were buying the original products, linked directly to Trader Joe’s.

While Pirate Joe’s continues to sell products in Canada, it will be interesting to see whether Trader Joe’s might now settle with the Canadian store and attempt to reconcile – and perhaps even promote it to a Canadian licensed retailer.

To learn more on trademarks, contact me today.

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