Why the Trader Joe’s lawsuit against a similarly named crypto firm may not be ‘a slam dunk’

The platform, registered within the British Virgin Islands with a headquarters in New York, payments itself as a decentralized website the place crypto customers can borrow and lend funds on the Avalanche and Ethereum blockchains. Dealer Joe’s bought wind of the operation and, after failing final yr to steer a website title authority at hand over the crypto website’s traderjoexyz.com handle, filed the federal lawsuit.

The complaint accuses the founding father of Dealer Joe of fraudulently claiming he named the positioning after his brother and factors to social media feedback the place he contradicts this and writes as a substitute the positioning is called “after the grocery retailer.” The grocery chain additionally factors to a picture on Twitter (now X) the place it makes use of a picture of a produce stand.

The lawsuit additionally accuses the crypto website of enterprise “a vandalism-based advertising marketing campaign in Paris throughout Paris Blockchain Week—plastering ‘Dealer Joe’ branded materials on private and non-private property across the metropolis.”

Regardless of all this, Dealer Joe’s faces a number of obstacles in getting the crypto website to cease utilizing its title. For starters, though names are very related and the grocery chain has registered quite a few marks with the U.S. Patent and Trademark Workplace, that’s not essentially sufficient to prevail. The reason being that logos are tied to sure lessons of companies and, on this case, the crypto outfit is providing one thing very different than groceries. This implies few shoppers would assume Dealer Joe’s and the crypto website had been the identical model.

Dealer Joe’s although, could have a stronger case relating to “trademark dilution,” in keeping with Michael Keyes, an mental property skilled at Dorsey & Whitney. Keyes informed Fortune that Dealer Joe’s, which is in 42 states, has constructed extremely robust model recognition—approaching the extent of Amazon or McDonald’s—which suggests it might prevail even within the absence of shopper confusion by arguing that Dealer Joe is harming its well-known title.

“The clear intent right here is to commerce off Dealer Joe’s goodwill,” mentioned Keyes, including the grocery chain has “a robust case on infringement although not a slam dunk.”

Sadly for Dealer Joe’s, even when it wins in court docket, that is probably not sufficient. That’s as a result of the corporate has solely recognized one particular person behind the buying and selling website—a Chinese language nationwide dwelling in Singapore—and listed the opposite defendants as “John Does.” Which means that the corporate probably will wrestle to implement any court docket victory it obtains.

Based on Keyes, it’s attainable Dealer Joe’s may use the order to use stress to third-party distributors that do enterprise with the crypto platform within the U.S.—equivalent to cloud computing distributors—however that doing so may be onerous. He added that, even when the lawsuit is an uphill battle, Dealer Joe’s could also be pursuing it partly to sign it should proceed aggressively defending its model.

In 2013, Dealer Joe’s sued a agency referred to as Pirate Joe’s that made a enterprise of bringing legally bought gadgets from a grocery retailer throughout the border into Canada and reselling them. The Vancouver-based vendor lastly referred to as it quits in 2017, with proprietor Mike Hallatt telling the Guardian that “the prospect of going to trial towards a significant company if you’re one man—you get a lot of opinions from legal professionals telling you: ‘Run.’”