Chipotle is suing Sweetgreen for trademark infringement over burrito bowl

Chipotle Chicken Burrito Bowl by Sweetgreen

Source: Sweetgreen

sweet greenThe stock fell 10% in morning trade Wednesday after Chipotle Mexican Grill filed a lawsuit against the salad chain alleging trademark infringement for its new “Chipotle Chicken Burrito Bowl.”

Chipotle filed the lawsuit in California federal court Tuesday, less than a week after Sweetgreen posted the menu item.

When the new bowl was announced Thursday, Nic Jammet, Sweetgreen’s co-founder and chief concept officer, said in a statement that the name was inspired by its use of “bold Chipotle spices.” Chipotle said in its complaint that when it heard about the Chipotle Chicken Burrito Bowl, it sent Sweetgreen a cease and desist letter and asked the company to drop “chipotle” from the name, but Sweetgreen never responded.

Chipotle’s lawsuit also alleges that Sweetgreen’s advertisements for the “Chipotle” menu item use a font similar to the burrito chain’s stylized logo and sometimes a shade of red similar to Chipotle’s proprietary Adobo Red. On Sweetgreen’s website, the product name is larger than any other identifier linking it to Sweetgreen, Chipotle argues in the complaint.

The complaint also makes multiple references to the fact that Chipotle and Sweetgreen are both competitors in the fast-casual space.

In addition to seeking an injunction against Sweetgreen, Chipotle is also seeking the profits Sweetgreen makes from the Chipotle Chicken Burrito Bowl.

“We do not typically comment on litigation, but we will say broadly that we are committed to protecting our valuable brands and intellectual property,” Chipotle’s chief corporate affairs officer, Laurie Schalow, said in a statement to CNBC. “Consistent with this, we will take appropriate action where necessary to protect our rights and brand.”

A Sweetgreen representative said the company was aware that Chipotle filed the lawsuit but declined to comment on pending litigation.

As Sweetgreen’s investors worry about the chain’s ability to become profitable, the company’s shares have fallen 23% in 2023, pushing its market value down to $731 million.

Chipotle, on the other hand, posted strong sales despite macroeconomic concerns. Its shares are up 22% over the same period, giving the fast-casual giant a market value of $47.1 billion.