Shulman Hodges & Bastian LLP

Use of "chatta" at issue in trademark suit filed by RumChata maker

When a brand becomes positively recognized by consumers, it's natural for other companies to move toward that space in the market and try to profit. There are limits, though, to how far a business can go in terms of benefiting from another company's branding.

Using the trademark of another business without permission, or using a trademark that is similar enough to another to cause confusion, could lead to a trademark infringement lawsuit. That is the case for a California alcoholic beverage company, according to a lawsuit recently filed in federal court.

Agave Loco, maker of RumChata and other alcoholic drinks whose names end with "Chata," is suing Paso Robles-based Cheers Wine & Spirits. Cheers makes and markets a wine called Lemonchatta, and Agave Loco claims that Cheers has marketed Lemonchatta "in order to cause confusion, mistake, or to deceive customers."

Specifically, Agave Loco claims that Cheers' use of the suffix "chatta" too closely mimics the "Chata" of RumChata, YumChata and other "Chata" beverages for which Agave Loco has filed trademark applications.

According to a report on the lawsuit, Cheers has already filed its own trademark application for Lemonchatta.

Agave Loco is seeking an injunction against any branding by Cheers that uses the "Chata" or "chatta" suffixes. The RumChata maker has also requested that Cheers destroy all of its marketing materials that bear the "chatta" marks, as well as pay Agave Loco any profits Cheers derived from the sale of Lemonchatta.

Whether you need to file a trademark infringement lawsuit or defend against one, it is crucial that you have solid legal advice to protect your interests. To learn more, please see Shulman Hodges & Bastian LLP's intellectual property overview.

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