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Cheetos versus Peatos: Infringement or Overreach?

Posted in Branding, Famous Marks, Food, Goodwill, Infringement

PepsiCo recently made waves with its purchase of SodaStream, but the company is now making news in the food business. This time the news is all about Pepsi’s Frito-Lay division, and its mischief making Chester Cheetah and his crunchy, cheesy, Cheetos brand. Pepsi recently sent a cease and desist letter to World Peas, a manufacturer of healthy-ish snack foods and its recent marketing of Peatos brand snacks.

 

What are Peatos exactly? They’re a crunchy snack food made primarily from peas and lentils, but, Peatos are not intended to be a “health food.” The company describes its mission as making “90% of people eat 10% better, not 10% of people eat 90% better.” The goal appears to be: make a snack that is a little bit better for you without sacrificing flavor. Product quality aside though, is Pepsi correct that the PEATOS mark is confusingly similar to the CHEETOS mark?

Courts consider a variety of factors in evaluating whether someone is infringing another’s trademark: do the marks create similar commercial impressions; are the products at issue competitive, similar, or related; how strong are the marks in terms of meaning and commercial strength; are the goods sold through similar channels of trade (i.e., through the same types of stores); and others. The two factors that tend to play the most prominent role are the similarity of the commercial impressions of the marks and the similarity of the goods.

In the Peatos versus Cheetos dispute, many of the factors would favor Pepsi. The goods are competitive (even if one is a bit healthier), both are sold in the grocery stores, and the CHEETOS mark is an arguably famous and strong mark. But even if every single factor but one were to favor Pepsi’s claim of infringement, it would not be enough if the marks are so dissimilar that no confusion is likely. So what do you think, how similar to Cheetos is Peatos?

The only difference in sound is the initial letter P versus the CH sound. Visually, the marks have a few more differences in letters. As far as I’m aware, neither mark has a defined meaning. The PEATO mark has additional meaning of one its ingredients (Pea).

But what about the overall commercial impression of the marks? What is the impression that Peatos will make in the mind of a consumer? For me, the immediate impression is that the product is a Cheeto made from peas. In fact, I can’t imagine that World Peas came up with the name in any other way other than “What should we call a Cheeto made from peas? Oh! Peatos would be a good pun!”

A likelihood of consumer confusion does not require actual consumer confusion. It also does not require that consumers confuse the products themselves, or that a consumer incorrectly think that Pepsi makes Peatos. A likelihood of confusion exists whenever a consumer might mistakenly believe that there is some type of endorsement, connection, or affiliation between the two parties. Given Pepsi’s recent purchase of SodaStream and the general trend toward healthier consumer choices, is it really that much of a leap to imagine a famous brand of snacks extending into a pea-based version of itself?

Setting aside the similarity in the marks, World Peas is actively drawing a connection between Cheetos and Peatos through use of a tiger and a similar color scheme for its bag and logo. The fact that the actual Peatos products look like Cheetos isn’t likely an issue, but it doesn’t help, especially if Pepsi argues a claim of post-sale confusion.

In addition to all this, World Peas makes explicit Cheetos comparisons on its website. Granted, these comparisons likely qualify for a fair use (although the use of the Cheetos logo may be more than necessary). However, when you know you’ll be poking the tiger, do you really need to pull its tail and poke it in the eye too? If the company truly plans on sticking with the Peatos name, it may have been best to not exacerbate Pepsi’s concerns and use a different colored logo, avoid the tiger on the packaging, and maybe not so aggressively market yourself as a healthier version of Cheetos. While Pepsi may have still come knocking, Pepsi would at least have less ammunition for its claims.

I wouldn’t say this a clear cut case of infringement, but given all these facts, there is at least a colorable claim of infringement . The company must have known it would receive a demand letter regarding the name. Perhaps the plan was to enjoy the free press for its new product and then switch the name, knowing the name change would also be heavily publicized?

Apart of from the potential legal liability, it isn’t a terrible plan, and I’m certainly interested in trying a bag of Peatos. Once I find a bag, I’ll be sure to let you know whether they’re g-r-r-r-r-r-r-r-eat!