Dip that chip!
The latest food lawsuit gives new meaning to the phrase “let the chips fall where they may”. Frito-Lay, the famous American snack distributor, has recently lost a legal battle against a smaller competitor involving their “Scoops!” tortilla chips. Medallion Foods, a private-label food subsidiary of Ralcorp Holdings, won the jury’s favor over their own brand of snacks that allow you to easily scoop up salsa, guacamole, or dip. Frito had been seeking $4.5 million worth of damages from the St. Louis company, claiming that their version of the scoop-able chip was simply a rip-off of their famous “Scoops!”. A U.S. district court in Dallas came to the decision in late winter, surprising many of those who assumed Frito-Lay had the inside track on a settlement.
Lawyers representing Ralcorp Holdings have not been shy about their recent legal victory. Scott Eidson, who represented Medallion Foods, has been quoted as saying, “The bottom line was, we built a better mouse trap”. David Harlan, a fellow attorney, went on to say “This is breaking their monopoly,” in reference to Frito-Lay’s domination of the bowl-shaped tortilla chip. Frito-Lay, apparently showing some sour grapes, rebutted with the fact that part of Medallion’s defense was that their chip could not compare to Frito’s Scoops!, therefore admitting the bigger manufacturer had the better product. Ralcorp themselves was recently purchased by a food company in Nebraska for $5 billion. Perhaps this was Frito-Lay’s main motivation to take up legal action over their intellectual property.
The real story here is the lack of firepower behind Frito-Lay’s legal team. Considering they are a division of PepsiCo, one of the biggest food-and-beverage companies in the world, one would think they would be able to construct a winning case. Shouldn’t they have had a decently laid out legal plan, based on the fact that they were the ones who brought the lawsuit against Medallion Foods? I would compare this to dipping a chip into a giant bowl of guacamole when tortilla chip breaks off in the process. Maybe it’s time Frito lays off on the snacks.