Yahoo Finance ‘Cat’ fight: Caterpillar tries to cancel coffee brand’s trademark
Caterpillar (CAT) has been in the crosshairs of the ongoing U.S.-China trade war as it’s dealing with a separate domestic battle — over a three letter word.
The world’s largest construction equipment maker has started a feud with California coffee brand Cat & Cloud over the word “cat,” demanding it remove its trademark from apparel and footwear. Co-owners Jared Truby and Chris Baca also host a podcast, where they riff on coffee culture and first announced the news about this lawsuit last month.
Truby filed for the Class 25 trademark in 2015, prior to opening up the first coffee shop in Santa Cruz, California, the following year. Cat & Cloud has a second location in Portola, California, and will open two more by the end of this year. The company also sells bags of ground coffee and other merchandise like sweatshirts, caps, and mugs in store and on its website. Truby told Yahoo Finance that these items make up 10% and 15% of the company’s retail sales. Last year, the company made $150,000 in total revenue.
In public documents reviewed by Yahoo Finance, Caterpillar Inc. first submitted a petition to the U.S. Patent and Trademark Office requesting Cat & Cloud cancel its Class 25 trademark, which includes clothing, footwear and headgear in June 2016. Then the company requested an answer to petition for cancellation in August 2018. Truby said while they are still in the discovery phase, his lawyer happened to know someone on Caterpillar’s legal team and learned “they are not interested in backing down,” hence why he’s publicizing the matter now.
“We have the right to defend our trademark... But we have infinitely fewer resources,” Truby told Yahoo Finance. “We’re a small company, and it seems really obvious there’s no conflict whatsoever. We never print the word ‘cat’ by itself and never plan to in the future. We’re trying to form a coalition and raise awareness.”
Meanwhile, heavily resourced Caterpillar wants to end this process (and negative publicity) expeditiously. “We are not suing Cat & Cloud, not targeting a small business and not focused on Cat & Cloud’s primary interest: coffee. We’ve simply asked the U.S. Trademark Office to remove Cat & Cloud’s trademark registration on footwear and apparel only, products for which Caterpillar has longstanding trademarks and a considerable business. We hope to resolve this issue quickly,” Caterpillar said in a statement to Yahoo Finance.
David versus Goliath?
The purpose of trademark law is to “identify and distinguish” the goods of one seller from another.
It is perplexing to think that 94-year-old Caterpillar, known for its mustard yellow machinery, would have any kind of overlap in target demographic with a millennial-friendly coffee startup whose slogan is “leave people feeling happier than you found them.” It would certainly be a stretch to claim anyone would confuse one brand for the other.
But the construction behemoth, which reported $54.7 billion in revenue last year, emphasized that many of its customers are small business owners themselves.
“Caterpillar serves customers around the world, many of whom earn their livelihood with one or two machines and often a good pair of work boots. We value all of them and strive to provide exceptional products and services. This means we have a responsibility to protect and maintain the brand they love and rely on every day — including our existing trademarks,” Caterpillar said in a statement.
Cat & Cloud is expecting to spend six figures on costly trademark litigation. The owners set up a GoFundMe page seeking help with legal fees, with a nearly five minute video of him and Baca clad in Cat & Cloud merch. Fans and old employees of the brand also set up a Change.org petition to stop “bullying” Cat & Cloud. As of Wednesday afternoon, the post received nearly 16,000 signatures (of its 25,000 goal).
When asked whether he has tried to discuss the issue with Caterpillar directly, Truby said, “We’re specifically trying to tag CEO Jim Umpleby in posts on social media but we haven’t heard back. This is a huge distraction. It’s been a really hard balance to work towards opening a cafe and protecting our employees.”
Where did the name Cat & Cloud come from anyway? Turns out the logo predates the business and was derived from a sketch a friend did of Truby and Baca.
“The cat is a representation of him and the cloud is of me. I am the idea, innovator, connecting big pieces together. Chris is very great, grounded, and the connoisseur, obsessed with high quality. And we just mesh well together.”
This kerfuffle may actually be good for business. The company has been gaining national attention through its campaigns (and celebrities like Sophia Bush have been posting about it) and the merch is gaining more popularity — with its sweatshirt and t-shirt sold out. After all, they could be valuable collectors items if Cat & Cloud ever ends up losing its name.
Melody Hahm is a senior writer at Yahoo Finance, covering entrepreneurship, technology and real estate. Follow her on Twitter @melodyhahm. She hosts Breakouts, a monthly interview series for Yahoo Finance featuring up-close and intimate conversations with today’s most innovative business leaders.
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