During the action the company even went all Raymond Chandler-esque and hired a private investigator to search for non-use of the ‘Honest Tea’ trademark by Annie Young’s iced tea firm Teavolution. Non-use of a trademark can lead to a firm losing rights to it.
However, Sarah Kelly, public relations manager, Coca-Cola South Pacific, told BeverageDaily.com that a decision was taken today to drop the action against Teavolution.
She noted that Coke’s US subsidiary, Honest Tea Inc. owns trademarks for the ‘Honest Tea’ name in the US and several other countries worldwide, with the first registered in 1999.
After Coke bought Honest Tea Inc. in 2011, Teavolution – founded by Young – approached The Coca-Cola Company and offered its Australian trademark for sale, Kelly claimed.
Honest Tea Inc. withdraws action
Honest Tea Inc. and Teavolution now disagree about the validity of the trademark registrations held by Teavolution (since 2005), Kelly added, which led Honest Tea Inc. to pursue action through federal body the Australian Trade Marks Office (IP Australia).
But today Coke chose to cut its losses: “Honest Tea Inc. has now elected to withdraw its non-use cancellation actions against the ‘Honest Tea’ trademarks owned by Teavolution,” Kelly said.
“We had engaged in trademark administrative actions as a means of protecting Honest Tea Inc.’s rights in response to the several unsolicited approaches from Teavolution attempting to sell its marks to Honest Tea Inc., and have decided not to pursue these," she added.
‘Relief is an understatement!’ – Teavolution founder
Following Coke's withdrawal, Young told us this morning: “Relieved is an understatement – we’re having champagne and cups of tea, doing both!”
“Coke were doing what their lawyers do. But I guess it’s coincidental that when we get vocal and say ‘please stop bullying me’,” she added.
“Then someone who cares says ‘Are we going to win this? No’, and the idea of bleeding us dry – well, I guess I can be very noisy and annoying!”
Young said Teavolution was relieved it could finally move forward in business terms: “The whole ordeal has slowed us down and been a burden that we’ve carried since October 2011 when Coke started the action.
“Every time you open an email from your lawyer it costs you AUS $1000 (US $900), so it’s been an expensive ongoing thing. It was always going to end badly for Coke – but it was two years almost that they tried to bleed us dry.”
Young explained before that Coke’s lawyers had taken many steps to delay a trademark hearing with her company – including requests for delays and legal demands for documents they already had – and ignoring Australian government requests for mediation in the dispute.
Coke’s Philip Marlowe moment…
Coca-Cola even hired a private eye to “sniff around for dirt and see if they could find evidence of non-use of the trademark, instead they found evidence of use, and this person even bought product directly from us”, Young said.
“It feels to me that their strategy is to stretch it out until they bleed me dry,” she said yesterday.
Young added that the more she read about the US-based Honest Tea Inc. founder Seth Goldman – click here to read a BeverageDaily.com interview – the more he seemed “just like us” with the same love of tea and outlook on how beverages should be.
Reflecting on Coke's decision not to pursue Teavolution further, she added: “Seth stands for what’s right, what’s good in the world. And when his Daddy company Coke doesn’t play fair, I’m assuming he might have been a bit against that."
Never told Coke: 'We want to sell our brand'
Before Coke decided to drop the action, Young said yesterday: “I would love to sit down with the Americans and ask them why they think it is OK to behave this way – why they think they have the right to my trademark that I have been using since 2004.
“It might be too late for us, but other small drinks companies need to be protected from Coca-Cola,” she added.
Today, addressing Coke’s claim of ‘several unsolicited approaches’ from Teavolution regarding the sale of Honest Tea, Young said: “They imply we wrote to them saying ‘we want to sell our brand’, which was never the intent.”
Young said Teavolution did receive an offer from another Australian firm seeking to buy its Honest Tea brand, and wrote a pro forma letter to every beverage company in the country describing what the business offered.
“Every brand is for sale…yes, we did write to Coke, but only once, I’m pretty sure. It was a form letter saying what was happening and what was available. And, of course, we’d always be open to offers for our business, as every savvy businessperson would,” Young added.