The renowned US grocery store chain, Trader Joe’s, has initiated legal action against the decentralized exchange (DEX), Trader Joe, alleging trademark violation at a federal level.
The legal documents suggest that the DEX is leveraging its branding to benefit from the grocery chain’s established reputation. This is purportedly creating confusion among consumers about the origins, sponsorship, or affiliations of the DEX and its offerings.
The cryptocurrency venture didn’t seek or obtain consent from Trader Joe’s to adopt a name mirroring the supermarket brand.
Despite several cease-and-desist notices sent by Trader Joe’s to Trader Joe since September 2021, the DEX neither acknowledged nor acted upon them.
Trader Joe’s is now pressing for the discontinuation of Trader Joe’s operations, statutory and exemplary reparations, legal costs, attorney fees, and other compensations.
Furthermore, Trader Joe’s is requesting a trial by jury.
Alleged Theft of Intellectual Property
The lawsuit asserts that Trader Joe has infringed on multiple intellectual property rights belonging to Trader Joe’s.
Specifically, the DEX operates under the domain traderjoexyz.com and has also secured domain names like trader-joes.site and trader-joe.website.
The company further contends that the visuals used by the DEX bear a striking resemblance to Trader Joe’s branding. They pointed out that:
“An image portraying ‘Trader Joe’ adorned with a red cap – reminiscent of the signature color associated with Trader Joe’s logo, store designs, and merchandise – is prominently displayed as the platform’s icon.”
Furthermore, an app bearing the “Trader Joe” label exists, allowing users to access the platform’s offerings under that moniker.
Additionally, Trader Joe manages multiple social media accounts under the identical name, all aiming to market the platform and highlight its services. Platforms such as Twitter/X, Reddit, Github, LinkedIn, Substack, Telegram, and Discord all feature Trader Joe’s presence.
‘My Brother Joe’
The lawsuit accuses Trader Joe of “committing fraud” to retain the platform and its domain name for an extended period.
The suit states, “The defendants intentionally obscured the true origins of their naming choice and used this deception to their advantage in international legal battles against Trader Joe’s regarding the domain name. They knew that revealing the actual backstory would undermine their position […].”
This points back to an unsuccessful effort the previous year to close the DEX.
In May 2022, Trader Joe’s lodged a grievance with the World Intellectual Property Organization (WIPO) targeting Trader Joe. In defense, the latter professed that the platform was named in honor of a co-founder’s sibling.
The lawsuit elaborates, “Based on these claims—which have since been proven untrue—WIPO dismissed the complaint put forward by Trader Joe’s […]”
A few weeks after this decision, a co-founder using the pseudonym “cryptofish” divulged in a Substack post that the platform’s name was indeed inspired “by the supermarket.” This admission suggests to Trader Joe’s that WIPO had been misled.
The grocery chain emphasizes that the DEX’s conscious decision to utilize the Trader Joe’s branding demonstrates intentional infringement, orchestrated to sow confusion and achieve monetary gain.
As of now, Trader Joe DEX, which operates across multiple blockchains including Avalanche, BNB Chain, Arbitrum, and Ethereum, has assets valued at $22.1 million locked in, as per data from DeFiLlama. This is a considerable decrease from the $2.59 billion recorded in December 2021.