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Can Great Harvest Bread block Panera's sale to JAB?
Panera Bread received a lot of attention last week when JAB Holdings purchased it in a deal valued at $7.5 billion, but one chain is hoping to block the sale. Great Harvest Bread, which is in a trademark infringement lawsuit with Panera, has filed an objection letter with the Federal Trade Commission asking for an examination of the proposed sale.
April 25, 2017 by Cherryh Cansler — Editor, FastCasual.com
Panera Bread received a lot of attention last week when JAB Holdings purchased it in a deal valued at $7.5 billion, but one chain is hoping to block the sale. Great Harvest Bread, which is in a trademark infringement lawsuit with Panera, has filed an objection letter with the Federal Trade Commission asking for an examination of the proposed sale. Great Harvest President Eric Keshin told FastCasual that the brand's objection is based on the following:
- The trademark infringement lawsuit has not been settled; "Panera's Food as it Should Be" has been in question due to its similarity with Great Harvest's Bread, "The Way it Ought to Be," and Panera's $7.5 Billion sale includes the purchase of the trademark that is under scrutiny.
- Great Harvest has filed on grounds for competitiveness, with Panera aiming to dominate the breakfast segment — Great Harvest's forte.
- JAB owns Peet's Coffee and Tea, a company that Great Harvest has an agreement with to sell the products in its more than 200 locations across the country. The sale of Panera to Peet's owner could potentially interfere with the Great Harvest and Peet's agreement.
"We believe that the sale of Panera to JAB Holdings will result in an unfair competitive advantage allowing Panera to dominate the breakfast segment," Keshin said in the interview with FastCasual. "We are concerned with the detrimental impact on competition if this merger between Panera and JAB Holdings proceeds and believe that it is even more unfair given the prior conduct of Panera in using the registered intellectual property rights without our permission."
Great Harvest filed the trademark lawsuit in March 2016 in federal court in Charlotte, North Carolina. The lawsuit is in the deposition and discovery stages, but Keshin said the company is continuing to pursue this case to stop Panera from infringing on its trademark.
"The sale of Panera, which includes the company's slogan, takes the case to another level and raises our concern," he said. "Should the sale move forward, we believe that Panera would be reaping the economic rewards from both the trademark and the proposed sale."
Keshin said he trusts that the Federal Trade Commission and U.S. Department of Justice will put together a thorough examination of the proposed sale and a fair outcome will be determined.
"We eagerly await the outcome of the examination and, in the meantime, will proceed accordingly with the necessary steps in the active infringement lawsuit," he said.
Panera responded to FastCasual's request for comment by saying that it did not comment on legal matters.
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