A Chicago federal court denied a TRO in a Lanham Act case between rival hot dog companies -- operated by different members of the same famous hot dog family. The court balanced the right to truthfully associate oneself with “family tradition” against the harm from trading on a competitor’s reputation. The Plaintiff is Chicago’s famous Vienna Beef (which controls 75% of the market); the defendant is Red Hot Chicago, Inc., run by the grandson of Vienna Beef’s founder. At issue was the grandson’s attempt to use advertising statements about his family’s “118-year tradition” of hot dogs and sausages in Chicago. The court denied the TRO on two main grounds: (1) acquiescence (most of the challenged advertising had been running for years); and (2) the absence of extrinsic evidence to demonstrate consumer confusion. Background. Vienna Beef was founded after the Ladany family sold sausages at the 1893 Columbian exposition in Chicago. Grandson Scott Ladany worked for Vienna Beef for 12 years, left the company, waited out his 2.5 year non-compete, and then formed rival Red Hot Chicago. Ladany recently began to advertise Red Hot Chicago with statements about “our family,” including the “family recipe,” and the “118 years” that the family has been in the business.
Vienna Beef’s Implied Falsehood Claim. In its brief, Vienna argued both literal and implied falsity, but the claim appeared to rest more on the latter: “Each separate statement” is “crafted to work in conjunction” with the others, to “convey” (i.e., “imply”) a “single, false conclusion” -- that the grandson, by virtue of his status “as a member of the Lanady family … is carrying on the Vienna tradition.” As Vienna Beef’s CEO stated, “We’re concerned that he is attempting to mislead people into thinking that he is part of our organization or we’re a big happy family.”
TRO Denied. The TRO was denied based chiefly on delay -- defendant was able to show that almost all of the challenged phrases were in use for years, which, at a minimum, undermines the urgency necessary for a TRO. In addition, the court found that the advertising statements were “literally true” and that Vienna’s real argument -- that the ads “conveyed a false impression” -- was a nonstarter because the plaintiff failed to present evidence of consumer confusion. The court also disapproved of plaintiff’s related trademark claims, such as use of the phrases like “make me one with everything,” and “drag it through the garden,” holding that such phrases were used “descriptively” to describe a hot dog with all of the toppings.
Significance for practitioners. Practitioners should recommend against bringing emergency TRO motions for promotional statements in use for a long period of time. Courts don’t like this. The result might have been different with a slower-paced and fully-developed preliminary injunction hearing. In addition, plaintiffs should present extrinsic evidence of actual consumer confusion or deception before arguing that a claim, although literally true, creates a false impression. The plaintiff here committed both errors with the result being that this “family beef” was decided in favor of Red Hot Chicago.
- Randy Miller & Quin Landon