Published on April 12, 2012
Posted in: Blog
Lassonde Industries learned a harsh lesson this month: hardball litigation can generate some seriously bad publicity. Although a party may have a legally enforceable position, the negative press that can be associated with litigation can make it hardly worth it. This is particularly true in “David and Goliath” type situations where a large company sues a smaller party.
Lassonde is a major Quebec-based juice manufacturer that sells a line of juices under the “Oasis” brand, and is the owner of a registered trade-mark for the same name. Over the past seven years, it has been engaged in a protracted series of legal battles with L’Oasis D’Olivia Inc., a small company selling “Olivia’s Oasis and Design” skincare products. Lassonde alleged that L’Oasis D’Olivia infringed on its “Oasis” trade-mark rights.
The courts ultimately held that Lassonde’s claims were completely meritless – the two products are clearly not confusing. However, both sides accumulated significant legal bills in the process of arguing their cases. Although a lower court initially ruled that Lassonde would be required to pay L’Oasis D’Olivia’s legal fees in full, the Quebec Court of Appeal recently sided with Lassonde and ordered that L’Oasis D’Olivia Inc. would have to pay the majority of its legal fees itself.
While Lassonde prevailed in the Quebec Court of Appeal, they subsequently lost in the court of public opinion. When news spread this past weekend that Lassonde had spent years and hundreds of thousands of dollars pursuing a meritless claim against a small-time local business, the public’s reaction was one of outrage. Anti-Oasis facebook groups were started, Twitter was flooded with negative comments, and a Quebec radio personality even advocated a boycott of Oasis juice. In short: the Court of Appeal decision created an unmitigated public relations disaster for Lassonde. Under intense scrutiny, Lassonde bowed to public pressure and agreed to pay L’Oasis D’Olivia’s legal fees after all (over $100,000 in total).
Whether or not the Court of Appeal’s decision was correct is largely irrelevant in this case. In the end, the negative press Lassonde received far outweighed the money it sought to recover. The bad optics of the lawsuit damaged the Oasis trade-mark’s reputation much more than L’Oasis D’Olivia ever could have.