Frito-Lay loses suit over chips

ST. LOUIS – A Texas jury has sided with a St. Louis company in its fight with snack giant Frito-Lay over the right to produce bowl-shaped tortilla chips.

Plano, Texas-based Frito-Lay sued St. Louis-based Ralcorp Holdings and its Medallion Foods subsidiary in February 2012, saying Ralcorp’s Bowlz corn chips were too similar to Frito-Lay’s Tostitos Scoops! chips. In both cases, the chips are formed into small bowl shapes, allowing for easier scooping.

“Defendants’ bowl-shaped tortilla chips and accompanying package are an apparent intentional effort to imitate the famous, successful mark and packaging of Frito-Lay’s Tostitos Scoops! tortilla chips,” the lawsuit claimed.

Frito-Lay asked the U.S. District Court in Dallas to order Ralcorp to stop making the chips and pay $4.5 million damages, but a jury sided with Ralcorp on Friday.

Frito-Lay said in a statement it was disappointed in the ruling and weighing its legal options.

Ralcorp is a leading maker of store-brand foods – private-label products using the brand names of stores where the items are sold. Ralcorp is now part of Omaha, Neb.-based ConAgra Foods Inc. after a $5 billion purchase was completed in January.

Ralcorp had responded to the lawsuit by saying it used a different manufacturing process and made a better chip at a lower cost.

“We are pleased with the jury’s decision in our favor,” ConAgra said in a statement. “We believe private brands offer a strong value to consumers, and we are delighted to bring terrific choices to shoppers. We will continue to develop and make distinctive, high-quality food like this chip.”

Frito-Lay spokesman spokesman Chris Kuechenmeister countered with a statement saying the verdict showed his company’s chips were superior.

The jury “agreed with Defendants’ own argument that their product is not comparable to the design of the great Tostitos SCOOPS! products that tens of millions of Americans have come to love,” Kuechenmeister said.