ECJ prevails on behalf of Shakey’s Pizza Asia Ventures in mash over “Potato Corner” brand

On November 14, 2024, the U.S. District Court for the Central District of California entered a preliminary injunction order affirming Shakey’s Pizza Asia Ventures Inc.’s (SPAVI; PSE: PIZZA) exclusive ownership of U.S. trademarks comprising the brand associated with international fast food chain, the “Potato Corner,” paving the way for an imminent U.S. expansion of the brand.

The Court sided with arguments from Michael D. Murphy and Kenneth P. Hsu, Partners at Ervin Cohen & Jessup LLP and counsel for SPAVI, and ordered defendants Guy Koren and PCJV USA LLC to cease further use of SPAVI’s three registered trademarks – namely, the Potato Corner name, tagline catchphrase (“World’s Best Flavored French Fries”), and their iconic “Spudster” logo.

“In addition to focusing on our litigation strategy, we were balancing a variety of non-litigation issues, often purely business related, including brand protection, transferring former franchisees into new licensees, supply chain issues, corporate structuring, and so on,” said Murphy.

“Our job has been not only to shut the old franchising entity down, but also to assist the client in potentially partnering with some of the former franchisees to help them achieve success as Potato Corner stores within the SPAVI family. This preliminary injunction order is a big step in that process.”

The Potato Corner brand began in 1992 as a food cart in a shopping mall in the Philippines and, over time, expanded its reach to more than 1,000 stores worldwide under its previous owner, Cinco Corporation. In 2009, Cinco entered agreements with Koren and others to open Potato Corner stores in the U.S. The relationship between Cinco and Koren soured over time, and by 2018, the two entered into a long running legal dispute as Koren sought to assert control of the Potato Corner brand in the U.S.

In 2022, SPAVI, a publicly traded, Philippines-based food service company that also owns international brands such as Shakey’s Pizza Parlor and Peri-Peri Chicken, acquired the Potato Corner brand from Cinco. Despite SPAVI’s many good-faith attempts to negotiate with Koren, the dispute continued, forcing SPAVI to file a federal lawsuit for trademark infringement, among other claims. In its preliminary injunction order, the Court resoundingly rejected Koren’s contentions and confirmed that SPAVI both owned and controlled the Potato Corner brand. The Court also denied Koren’s simultaneous attempt to dismiss the lawsuit altogether.

“After years of these marks being in dispute through no fault of our client, we’re grateful the Court has finally recognized SPAVI’s unquestionable ownership of the brand, allowing it to serve its customers domestically just as it does internationally,” said Hsu.

The case is Shakey’s Pizza Asia Ventures Inc., vs. PCJV USA LLC, Case No. 2:24-cv-04546-SB-AGR (order granted November 14, 2024).