Viacom International Inc. has filed a lawsuit against IJR Capital Investments alleging that a restaurant owned by the company infringes on Viacom’s intellectual property in the “SpongeBob SquarePants” franchise. Viacom Int’l Inc. v. IJR Capital Invs., No. 16-0257 (S.D. Tex., Houston Div., filed January 29, 2016). As the complaint explains, “The ‘Krusty Krab’ is owned by Eugene H. Krabs, a prominent and recurring character in the SpongeBob universe. SpongeBob SquarePants works at the ‘Krusty Krab’ as a fry cook, but he also performs a myriad of other duties, and once stated that his official title is ‘Vice Assistant General Manager in charge of certain things.’”
IJR operates The Krusty Krab in Texas and has filed for trademark registration. Viacom argues that IJR is “attempting to trade off of the goodwill and reputation of the ‘SpongeBob SquarePants’ media franchise’ and that consumers are likely to be confused by IJR’s use of “Krusty Krab.” Viacom seeks an injunction and damages for false designation of origin, unfair competition, dilution, and trademark infringement under the Lanham Act and Texas law. It also requests that the court determine that IJR cannot register “The Krusty Krab” as a mark.