In an ongoing battle of the Billy Goats, a federal judge this week gave a win to the iconic Chicago side, saying the Billy Goat Tavern can continue with its trademark infringement lawsuit against a St. Louis snack chip maker.
On Aug. 7, U.S. District Judge Robert Dow Jr. rejected a motion by Billy Goat Chip Company, of St. Louis, to dismiss the legal action it faces from Billy Goat IP, owners of Chicago’s Billy Goat Tavern, the subterranean N. Michigan Avenue dive made famous in a 1978 “Saturday Night Live” sketch.
St. Louis residents Rob Lyons and Brian Roth started selling Billy Goat Chip Company products on Feb. 15, 2009, and registered their trademark on March 30, 2010. They say the name comes from the Billy Goat Hill area of St. Louis, and note their product packaging mentions the city as well as Missouri. This, they said, should ameliorate any confusion, even though they now are sold near Billy Goat taverns in Chicago and Washington, D.C.
The St. Louis businessmen further said they tried to negotiate an agreement earlier this decade in hopes of avoiding lawsuits, and noted they were selling chips in stores and online for years before the tavern began licensing its name for other packaged retail food and beverages in April 2017.
The tavern filed a trademark infringement complaint against the snack maker in December, and the chip company filed a counterclaim in March. It then filed a motion to dismiss the tavern’s initial complaint for failure to state a claim. The main argument was that the tavern’s Lanham Act claims should be dismissed because owners should’ve known about the chips in 2010, and expressly knew the chips were on the market in Chicago in 2014, yet didn’t initiate a lawsuit until 2017.
“In this case, there are too many unknown and disputed facts that preclude judgment,” Dow wrote, explaining that the Lanham Act itself has no statutory limitations, but courts in the same circuit routinely apply the three-year limits enumerated in the Illinois Consumer Fraud Act. He said the proceedings thus far give the appearance the chip company is correct about the tavern’s constructive notice in 2010 and actual notice in 2014, but he “cannot determine from the pleadings and exhibits whether Plaintiff’s delay in filing suit was inexcusable or whether Defendant would be prejudiced by allowing plaintiff to bring its claims now.”
The tavern said any delay in its decision to file a complaint is logical because the chips entered the Chicago market gradually, and customers only recently began expressing confusion. Further, the tavern said its cease-and-desist letter prevents the chip makers from mounting such a defense.
Further, the tavern said that since its complaint accuses the St. Louis operation of using its mark with bad faith to cause consumer confusion, it shouldn’t be allowed to use the timeline as a defense. Dow agreed, explaining the notion of unclean hands, which holds that this particular kind of defense “cannot be used to reward a party’s inequities or to defeat justice.”
Dow similarly refused to dismiss the tavern’s state law claims, or fraud and deceptive trade practices, which the chip maker said also should’ve been barred as outdated. The judge said trademark infringement limitations generally don’t begin rolling while the alleged infringement is ongoing, as is the case here, with the St. Louis chips still being sold in Chicago.
Currently representing Billy Goat IP are attorneys from Thompson Coburn LLP, Chicago.
The chip company’s attorneys are with Lathrop Gage LLP, which has offices in Chicago and Kansas City.