Gristedes recently revamped its 14th St. location in Manhattan with a new format, sign and name - Trader John's. Trader Joe's, whose wildly-popular first store in New York City is located three blocks away, sued the New York City supermarket chain for outright copying its formula.
On Friday, a city judge ruled in favor of Trader Joe's cease-and-desist request, agreeing that Gristedes' name for the location and red lettering were too similar to Trader Joe's.
"Of all the possible
names ... he just had to pick the name of a store a few blocks away with
a long line of people outside,"
Trader Joe's lawyer, Dale Cendali told MSNBC.
In its earlier 51-page complaint, Trader Joe's argued that Gristedes had the store "gutted, renovated and renamed and redecorated to make it appear more similar to Trader Joe's," and called the renovation a "blatant attempt to confuse consumers and capitalize on Trader Joe's hard-earned goodwill."
The lawsuit, according to The New York Post, also cited online critics calling the former Gristedes at the location "especially crappy" and "one of the filthiest of all the filthy, overpriced Gristedes." Lawyers said the "low quality" of that store, made "its attempted passing off as a Trader Joe's even more harmful by diluting and tarnishing of the Trader Joe's trademarks."
Gristedes' lawyer Larry Weinstein had argued that no one would mistake Trader John's for Trader Joe's because the new store wouldn't be selling any of Trader Joe's house brands.
Before the judge's ruling, Gristedes' spokesman Gerald McKelvey told the Post that Trader John's was a prototype "to see if we can sell groceries less expensively."
The idea came from Gristedes' owner John Catsimatidis, a billionaire who made most of his money in energy and real estate. Mr. Catsimatidis told Bloomberg News prior to the judge's ruling that the case had no merit. He said, "My name is John and I am a trader, so I don't know what their problem is."
Discussion Question: What do you think Gristedes was thinking with Trader John's? Considering the success of Trader Joe's, why haven't more grocers attempted a similar format? Are there particular challenges a chain would face if it wanted to set up a format similar to Trader Joe's?