Beyond Meat has been fined $38.9m after a jury in the US determined the meat-free company had infringed on a trademark of rival brand Vegadelphia.
According to court documents lodged in Florida, Beyond Meat’s use of the slogans “Great Taste, Plant-Based” and “Plant-Based, Great Taste” violated Vegadelphia’s trademark “Where Great Taste is Plant-Based”.
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In the infringement filing, which dates back to 2022, Vegadelphia parent company Sonate alleged Beyond Meat’s use of the slogan was likely to cause confusion to consumers.
Beyond Meat used the slogan in a joint advertising partnership with Dunkin’ Donuts.
The jury found Beyond Meat was liable for trademark infringement and that a fair-use defence did not apply.
As a result, the jury awarded Vegadelphia $23.5m in damages and $15.4m in disgorgement of the firm’s profits.
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By GlobalDataIn response, Beyond Meat claimed it did not agree with the result and intends to “seek further judicial review of the decision and appeal the verdict”, the court document said.
Earlier this month, Beyond Meat’s quarterly losses widened due to a $77.4m impairment charge, while the company pointed to a further drop in sales through the year-end.
The news comes as Beyond Meat’s net losses have widened due to a $77.4m third-quarter impairment charge, while the company pointed to a further drop in sales through the year-end.
For the three months to 27 September, the California-based group reported a third-quarter net loss of $110.7m, compared to a $26.6m loss a year earlier.
Nasdaq-listed Beyond Meat also reported a 13.3% decrease in sales, which at $70.2m came within its targeted range of $68-$73m forecast at the second-quarter results stage in August.
Beyond Meat set out plans to return gross profit margins to 30% or above as part of a business “reset” that includes the consideration of “strategic initiatives”.
President and CEO Ethan Brown said Beyond Meat is in a “turnaround phase” but emphasised a move away from mimicking meat.
“We’ve been in our turnaround phase for too long, and moving forward, you will not simply see more of the same from us,” Brown said in a third-quarter results call with analysts.
“There is plenty of fight left in Beyond and enormous enthusiasm to use this reset to hasten our future as a global protein company of tomorrow.”
Beyond Meat has not achieved an annual gross margin of at least 30% since 2020 (30.1%) and the metric fell to 10.3% in the quarter to 27 September from 17.7% a year earlier.
