Thursday, May 6, 2010

Say it Ain't So Joe: Trader Joe's Tells H-E-B's Joe V's Smart Shop to Change its Name

Analysis & Commentary

Yesterday we reported on and wrote about Texas grocery chain H-E-B opening its first Joe V's Smart Shop discount grocery store at 12035 Antoine Drive in Houston, Texas. Our story - May 5, 2010: H-E-B Opens Joe V's Smart Shop Discount Prototype Grocery Store in Houston TX ... But Where's Joe?

Last night we heard via e-mail from a reader who visited the store yesterday. He told Fresh & Easy Buzz there was a big crowd at the new store - and new format for grocer H-E-B - for the Cinco de Mayo grand opening. There was plenty of free food and lots of bargains offered, he said. It was a good, strong grand opening for H-E-B's Joe V's, according to the reader, who works in the food and grocery industry in a sales capacity.

But not all is good for H-E-B and the fictitious Joe V's beyond yesterday's grand opening.

The other Joe - Trader Joe's - is striking back. The local Houston Business Journal is reporting that Monrovia, California-based iconic grocer Trader Joe's filed a cease-and-desist order on April 26, just days before yesterday's grand opening, against H-E-B regarding its use of the "Joe" name for the new Joe V's Smart Shop discount format store.

The publication reports that, "according to documents filed with the U.S. District Court in Austin, Texas, Trader Joe’s is demanding that H-E-B 'immediately cease and desist its use of the word Joe in the proposed business name Joe V’s Smart Shop and in the associated promotional materials for the store,' and threatened to 'pursue any and all available legal remedies' if those demands were not met."

But H-E-B begs to differ.

On April 29, H-E-B responded to the Trader Joe's legal complaint by filing a declaratory judgment petition asking the federal judge to determine that "there is no likelihood of confusion, mistake or deception as to the source or sponsorship of H-E-B’s goods or services sold and planned to be sold under the Joe V’s name," reports the paper

"H-E-B contends that the only common element between the Joe V’s name and the Trader Joe’s name is 'Joe,' a term in which Trader Joe’s has no exclusive rights," an H-E-B spokesperson told the reporter. Further: "The name 'Joe' is an extremely common surname, and is widely used by many retail businesses, including in the grocery and food fields," he said.

Trader Joe's doesn't operate any stores in Texas - yet.

The full Houston Business Journal story is here.

Ironically, we lead our May 5 piece by making an analogy between Trader Joe's and H-E-B's Joe V's. Below is our lead paragraph:

"Unlike the "Joe" in the name of the iconic Southern California-based grocery chain Trader Joe's, which represents a real person - founder Joe Coulombe - the "Joe" in Joe V's Smart Shop, the name of the new discount grocery store concept by Texas-based grocery chain H-E-B, is a creative fiction, designed to personalize the popular privately-held grocer's new warehouse-style discount format, the prototype store of which opened today at 12035 Antoine Drive in Houston, Texas."

But it wasn't mere irony that lead us to choose that particular lead. Trader Joe's is vigorous in protecting its trademark name, including the use of "Joe" or "Trader" (and not just together in the same name) by grocers and any other business, regardless of the context.

When we first heard about H-E-B's Joe V's a couple months ago, one of the first things that came to mind was a challenge from Trader Joe's. We've even exchanged e-mails with a regular reader from Texas over the Trader Joe's-Joe V's name irony topic over the last few weeks.

We wrote about Trader Joe's trademark vigor in these two stories in the blog published on January 15, 2009: [Small-Format Food Retailing USA: The Big Apple Won't Be A Two-Trader City: Judge Says No to Gristedes' 'Trader John's' 'Trader Joe's' Knockoff and Small-Format Food Retailing USA -Trader v. Trader: Gristedes Complies With Judge's Order; Covers Up 'Trader' Portion of its 'Trader John's' Store Sign]. In this instance Trader Joe's was successful in forcing New York City's Gristedes supermarket chain from using the name "Trader Johns" on a new concept, small-format grocery store it opened last year in the city.

We aren't trademark lawyers here at Fresh & Easy Buzz. But it seems to us that the Gristedes "Trader John's" name was clearly an attempt to cash in on the Trader Joe's name, although the owner and CEO of Gristedes, billionaire John Catsimatidis, is named John.

But the use by H-E-B of the name Joe V's Smart Shop doesn't appear on the face of it to be an attempt to rip off the Trader Joe's trademark. Perhaps the use of Joe V by the grocer has some subliminal motivation behind it in terms of resonating in consumers minds. After all, "Joe," as in its usage in any variation when it comes to grocery stores, seems to be perceived as pure gold. But it's unclear to us that Trader Joe's is on solid footing in its legal attempt to get H-E-B to change the store's name. But then, we aren't trademark lawyers, so we'll have to wait and see. But a legal fight to the end over the name clearly is something that's likely to happen if H-E-B sticks to its guns.

Interestingly, in our piece yesterday we had some fun about the fact the Joe V of H-E-B's Joe V's Smart Shop is a creative fiction, unlike the Trader in Trader Joe's, who is a real person, founder Joe Coulombe, who sold the grocery chain to Germany's Albrecht brothers, of Aldi ownership fame, many years ago. Theo Albrecht is today the sole owner of Trader Joe's. He and his brother Karl both own Aldi, but under a separate ownership structure.

In the Houston Business Journal report, Armando Perez, the senior vice president for H-E-B in Houston, comments that the Joe V’s brand is based on the name of an H-E-B executive who was instrumental in developing the new concept over the past two years. We take Mr. Perez's word for that - but he's on the record in more than one instance saying the Joe V's name was created in order to personalize the new discount grocery chain. Other H-E-B executives have also said there's no real Joe V. Perhaps the H-E-B executive was an inspiration?

So we ask: Will the real Joe V please stand up?

The Trader Joe's cease-and-desist order against H-E-B and it's Joe V's Smart Shop is worth following. When it comes to its name, Trader Joe's, like fast food chain McDonalds, is willing to spend whatever it takes and devote whatever time is required to win. That it decided to challenge Joe V's suggests Trader Joe's will fight the name like a hungry dog going after a prime rib bone.

We said this in the last paragraph in our story about Joe V's yesterday: "The Joe V's format and prototype store will be an interesting development, from one of the most interesting and successful grocers in the U.S., to observe and follow closely. We will be doing just that.

But we have to admit, we didn't know it would get so interesting - so fast.

1 comment:

Fresh & Easy Buzz said...

See our May 20, 2010 post -
'H-E-B Tweaking Product Assortment at Joe V's Smart Shop Discount Grocery Store in Texas Opened May 5' - for the "inspiration" behind the Joe V's Smart Shop name.