By Lance Williams / The Tennessean
Kraft Foods has filed a lawsuit in federal court against Lebanon-based Cracker Barrel because of its plan to sell its own brand of meat products in grocery stores.
to the lawsuit, Kraft (NASDAQ: KRFT) has sold a brand of cheese called
"Cracker Barrel" in grocery stores since 1954, and that the restaurant
chain's move into grocery stores would violate the food giant's
trademark. Kraft said it has sold about $100 million worth of Cracker
Barrel cheese each year since 2000.
"(The chain's) actions
threaten to destroy the substantial goodwill that Kraft has created in
its Cracker Barrel trademark, and to create significant confusion and
cannot be permitted," Kraft argued in the lawsuit.
Kraft is asking
the court to rule that Cracker's decision to sell in grocery stores
would violate Kraft's trademark and "constitute unfair competition" and
"unlawful and deceptive trade practices," according to the lawsuit.
Barrel (NASDAQ: CBRL) already sells various food products, such as
pancake and corn muffin mixes, cobbler filling and syrup, under its
name. But those items are available only at Cracker Barrel stores and
through its website. According to the lawsuit, sales of food products in
Cracker Barrel retail stores represent about 4 percent of the company's
annual revenue of around $2.5 billion.
That would change under a
recent multiyear licensing agreement announced in November with John
Morrell Food Group, a Smithfield Foods subsidiary. It will make various
food products - such as ham, bacon, lunch meats, glazes, jerky and
summer sausage - under the Cracker Barrel name and sell them through
grocers, mass merchandisers and other retail outlets.
Cracker Barrel, which was founded in 1969, has not said when the new products will hit store shelves.
A spokesman for Cracker Barrel was not immediately available for comment.