Court issues preliminary injunction in favor of rival

Business Sucks

The lollipop wars have raged for nearly a century.

Spangler Candy Company’s Dum Dums brand was purchased by Spangler, the company that manufactures Circus Peanuts candy, in the 1950s and has been around since the 1920s.

Rival Tootsie Roll Industries produces the Charms Lollipop line, including the tiny Charms Mini Pops. Tootsie purchased the Charms line in the late 1980s, but the brand has been kicking around since 1912.

You can bet they keep an eye on each other.

Trading Dress?

In 2018, when a consumer notified Spangler that Tootsie’s packaging for its Mini Pops line bore a striking resemblance to the Dum Dums packaging, the company sprang into action with a Lanham Act (the Act) lawsuit. Spangler’s complaint alleges that Tootsie engaged in trade dress infringement and unfair competition under the Act when it chose to match Spangler’s distinctive package color and layout, which it had been using continuously since 2011. Spangler claims that Tootsie copies its distinctive trade dress without Spangler’s permission and that Tootsie is unfairly benefiting from Spangler’s investment in the Dum Dums trade dress and the reputation, success and goodwill that Spangler has cultivated through its marketing and promotion of its Dum Dums product.

“The trade dress is comprised of the bag’s principal color, red, with the brand name in white letters,” according to the plaintiff’s complaint, with “a display window showing the product, located in the lower half of the bag below the brand name and above a red bottom border of the bag; and a yellow oval located on the lower right hand side of the bag that covers a portion of the display window and has large blue numerals inside the yellow oval.”

Pretty specific. Spangler claims that Tootsie even copied the yellow palette boxes it uses to display the pops in box and warehouse stores.

The suit, which was filed a little less than a year ago in Ohio’s Northern District, took a positive turn for Spangler this month when the court granted it a preliminary injunction barring Tootsie from selling its Mini Pops in the offending packaging.

While the court noted that there was no evidence of actual confusion, the fact that Tootsie’s similarly designed bags were intended to be sold side by side with Dum Dums on store shelves indicated an intent to confuse customers. “Tootsie admits its consumers spend merely seconds picking out the package, basing the decision on recognition, possibly without even reading the package,” the court wrote. Given this lack of attention, the packages did not need to be identical, or even overtly deceitful, to violate Spangler’s trade dress. They just needed to be confusing. The court agreed with Spangler that the confusion would result in a “loss of control of its reputation by allowing Tootsie to sell the same product in the confusingly similar bag” and that this would cause “irreparable harm since ‘loss of control over one’s reputation is neither calculable nor precisely compensable.’” Although Tootsie objected over the expense the repackaging would incur, the court found that the loss of the Dum Dums brand’s “goodwill and reputation” outweighed Tootsie’s financial burden.

The Takeaway

In marketing their products, companies should be mindful not to infringe on the trade dress of another company’s product. Packaging that bears a resemblance to another product’s branding may cause confusion among consumers who spend very little time choosing a product based on its packaging.