Tuesday, April 22, 2008

Caribbean Crème files trademark infringement lawsuit against Krispy Kreme over “Caribbean Kreme”

Caribbean Creme's smoothie machine

On April 21, 2008, Caribbean Crème, Inc. (“CCI”), a St. Louis, Missouri-based company that produces and sells equipment to make a fruit smoothie by the name “Caribbean Crème,” filed a trademark infringement lawsuit against Krispy Kreme Doughnuts, Inc. and other affiliates companies (“Krispy Kreme”) in the U.S. District Court for the Eastern District of Missouri to stop the famed doughnut maker from selling a frozen beverage drink it calls “Caribbean Kreme.” See Caribbean Creme, Inc. vs. Krispy Kreme Doughnuts, Inc., et al., Case No. 08-cv-00541 (E.D. Mo. April 18, 2008). A copy of the complaint (courtesy of TMZ.com) can be downloaded here.

CCI holds a trademark registration for the design mark CARRIBEAN CRÈME (and Design) (pictured above on the left) for non-dairy, flavored frozen confections and ice cream drinks. According to the complaint, CCI has been selling its flavored semi-frozen drink under the name “Caribbean Crème” flavored since 1994.

Krispy Kreme, in addition to its popular line of doughnuts, has been selling a line of flavored frozen smoothies called Chillers. Sometime before April 8, 2008, Krispy Kreme introduced a new “limited time” (until June 2nd) Chiller flavor called Caribbean Kreme Chiller coinciding with Krispy Kreme limited-time specialty Caribbean Kreme Doughnut.

CCI argues that Krispy Kreme’s use of the name Caribbean Kreme for its competing semi-frozen beverage is likely to cause confusion with its own semi-frozen beverage. CCI claims federal trademark infringement under Section 32 of the Lanham Act (15 U.S.C. §1114), unfair competition under Section 43(a) of the Lanham Act (15 U.S.C. §1125(a)(1)(A)), common law trademark infringement, trademark infringement under Missouri law (Mo. Rev. Stat §417.066(1), and trademark dilution under Missouri law (Mo. Rev. Stat §417.061(1))

In addition to seeking an injunction against Krispy Kreme and an order destroying anything bearing the infringing mark, CCI also seeks Krispy Kreme’s profits, treble damages (under the premise that Krispy Kreme’s infringement was willful), costs, and attorney’s fees (under the premise that this case is “exceptional” under 15 U.S.C. §1117(a))

Vegas™Esq. Comments:
One wonders why CCI did not seek (at least not yet) any kind of preliminary injunction. After all, by the time this case gets anywhere, Krispy Kreme will no longer even be selling the Caribbean Kreme. If CCI was really serious about this infringement and wanted to stop it, why would it not seek an immediate preliminary injunction -- unless perhaps CCI realized its tenuous case for likelihood of success on the merits (weak mark, dissimilar marks when viewed in their entirety, no competitive proximity, Krispy Kreme's intent). The only factors seemingly favoring CCI are identical goods and low degree of care by purchasers (a factor that some Eighth Circuit decisions have recognized in deciding likelihood of confusion). Should CCI decide to push the case, the parties will likely reach some kind of settlement.

One wonders if CCI would have still had an issue if Krispy Kreme had chosen the name “Karibbean Kreme” – a much more fanciful mark more in line with the company’s famous KRISPY KREME mark and which is one additional "K" removed from CCI's mark.

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