Beyond Meat has been fined $38.9 million after a jury in the United States determined that the meat-free company infringed on a trademark owned by rival brand Vegadelphia.
According to court documents filed 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.”
In an infringement filing dating back to 2022, Vegadelphia’s parent company Sonate alleged that Beyond Meat’s use of the slogan could create consumer confusion.
Beyond Meat employed the slogan during a joint advertising campaign with Dunkin’ Donuts.
The jury concluded that Beyond Meat was liable for trademark infringement and that a fair-use defense was not applicable.
Consequently, the jury awarded Vegadelphia $23.5 million in damages, in addition to $15.4 million in disgorgement of the company’s profits.
In response, Beyond Meat expressed disagreement with the verdict and stated its intention to “seek further judicial review of the decision and appeal the verdict,” according to the court documents.
Earlier this month, Beyond Meat reported that its quarterly losses expanded due to a $77.4 million impairment charge, while also projecting a further decline in sales through the year-end.
This news emerges as Beyond Meat’s net losses have widened due to a $77.4 million third-quarter impairment charge, with anticipated sales declines extending through the end of the year.
For the quarter ending September 27, the California-based firm reported a third-quarter net loss of $110.7 million, compared to a loss of $26.6 million in the same period last year.
Additionally, Nasdaq-listed Beyond Meat reported a 13.3% decrease in sales, totaling $70.2 million, which sits within its targeted range of $68-$73 million announced during the second-quarter results in August.
Beyond Meat has outlined plans to return its gross profit margins to 30% or higher as part of a business “reset” that contemplates various “strategic initiatives.”
President and CEO Ethan Brown noted that Beyond Meat is currently in a “turnaround phase,” emphasizing a departure from merely imitating 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 stated during a call with analysts regarding third-quarter results.
“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, when it recorded 30.1%. The latest metric fell to 10.3% for the quarter ending September 27, down from 17.7% a year earlier.
