February 27, 2020

Pass The Mustard: Mustard Girl sues Olds Products over Trade Secret Misappropriation

Mustard Girl LLC sued Olds Products Co of Illinois, LLC on February 25, 2020 in the Circuit Court of Cook County, Illinois. Mustard Girl’s causes of action are: trade secret misappropriation under Illinois state law, breach of contract, tortious interference with a prospective business expectancy, promissory estoppel, and unjust enrichment.

According to the Complaint, Mustard Girl’s predecessor purchased various mustard formulas and then formulated additional new recipes for Stoneground Deli mustard, American Dijon mustard, Sweet N’Fancy Yellow mustard, and Sweet N’Spicy Honey mustard. Mustard Girl and Olds Products allegedly entered into a confidentiality agreement and, subsequently, Olds Products manufactured the mustard recipes for Mustard Girl.

After a successful run, including winning national awards, the relationship soured. Mustard Girl alleges that Olds Products deliberately supplied “watery batches” — clearly the bane of fine cuisine. Mustard Girl also asserted misuse of the trade secret recipes in Olds Products’ own discounted mustard products. The old “squeeze play!”

The outside observer, however, must chew on these facts: the confidentiality agreement specifically calls out “formulas, recipes” and “know-how” as falling within the definition of confidential information.  Furthermore, there is no time limitation on the confidentiality and non-use restrictions imposed on Olds Products — always a dangerous situation for the receiving party, as perpetuity can be a long time. Nevertheless, a mustard recipe can certainly be reverse engineered after it is publicly sold, and the confidentiality agreement includes the standard confidentiality exception for public disclosure of the information.

Thus, is there a better avenue for protecting mustard and other food-related intellectual property rights? Obtaining a regular utility patent on food recipes using natural ingredients is a notoriously difficult process at the USPTO. Hence, that avenue is not so “fancy” or “sweet.” A trademark, on the other hand, could be very valuable to a new mustard or food brand, but a trademark will not cover the underlying recipe. 

Thus, a lock-down confidentiality contract and exclusive supply contract are probably the best way to go. The present confidentiality agreement is a one-way “give only” type, clearly biased in favor of Mustard Girl. In hindsight, however, it could have been stronger on later publicly available knowledge. A separate written supply contract with more restrictive terms on exclusive use may have also been a good compliment for the condiment. 

Clearly this food throwing contest will leave a bad taste in someone’s mouth – long live the mustard!