Business Law III

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A Recipe for Success: Intellectual Property Protection for Recipes C. Bailey King, Jr. and Bridget V. Warren

C. Bailey King, Jr. is a partner and Bridget V. Warren is an associate at Bradley, a full-service

law firm, in Charlotte. Mr. King and Ms. Warren are commercial litigators with a broad busi-

ness litigation practice that includes intellectual property disputes in the Food, Beverage, and Hospitality industry. Within this area, they

counsel clients and litigate matters concerning trade secrets, trademarks, copyrights, patents

and non-compete agreements.

In today’s world of celebrity chefs, craft cock- tail mixologists, and experiential dining restaurants, unique culinary creations (for non-foodies, “recipes”) have become a valuable business asset. And, as with any other valuable business asset, commercial litiga- tors will be tasked by their clients with protecting these assets. The question for commercial litigators will be how.

In some respects, recipes should be tailor-made for intellectual property protection. New recipes are “invented” by highly educated and trained chefs (patent), marketed by restaurants under distinctive names like the Big Mac® or the Whopper® (trade- mark), described in flowery language in best-selling cookbooks (copyright); and closely guarded by res- taurants to protect a competitive advantage like the “secret eleven herbs and spices” at Kentucky Fried Chicken (trade secrets). In reality, though, estab- lishing any intellectual property rights, much less protecting them, in a recipe is challenging. Indeed, “stealing” another chef’s recipe (and of course putting your own “take” on it) is a time-honored tradition in the food service business.

As a practical matter, there are significant limita- tions on the protections that intellectual property can provide to the creator of a recipe, and it can only help those restaurants and chefs who are willing to take the steps necessary to protect their creations. Indeed, no matter what the creator of a recipe may claim, the vast majority of recipes are simply different combina- tions of familiar ingredients that come together in a way that is generally expected. For example, although your grandmother may make the sweetest brownies you have ever had, everyone knows this is because

she uses more sugar. Most recipes, even secret family recipes, are not truly novel, and patent protection, therefore, is rarely available. As for trademark protec- tion, all it can protect is the distinctive name (such as Oreao®) or appearance (such as the teardrop shape of a Hersey Kiss®) of a product; it provides no protec- tion for the recipe itself.

Under the right circumstances, though, a party who believes it owns a valuable recipe can use copy- right law or trade secret law to protect it. Which one of these protections it should rely upon will depend on how the recipe will be monetized. For example, a celebrity chef can publish a cookbook with his or her recipes and profit from the book sales. Of course, this will require the chef to reveal the “secret” recipe to the world at-large. Alternatively, a restaurant that believes it has a truly “secret” recipe for a popular dish that gives it a competitive advantage can use trade secret protection to prevent its employees from stealing the recipe and using it in competition.

Regardless of which type of protection a business relies upon, though, there are unique challenges in protecting a recipe based on its very nature—a com- bination of ingredients and cooking methods that are developed through the trial and error process of cook- ing. Courts have examined these issues as far back as 1924, and the rise in popularity of cooking shows and celebrity chefs have led to an increased number of cases in recent years. There, however, is still a dearth of cases that analyze the circumstances under which a recipe may be copyrightable or protected as a trade secret. Even more, there is no consensus among the courts that have looked at these issues as to when a recipe is entitled to protection. The purpose of this article is to identify those challenges so that counsel can develop strategies to deal with them in litigation.

Copyright Protection Copyrights are a form of protection to the authors

of “original works of authorship” that are fixed in a tangible form of expression. 17 U.S.C. § 102(a). Such original works include literary, dramatic, musical, and artistic works. Copyright does not protect facts,

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ideas, procedures, processes, systems, principles, or methods of operation. 17 U.S.C. § 102(b). To establish a claim of copyright infringement, one must prove ownership of a valid copyright and the copying of constituent elements of the work that are original. Publications Intern. Ltd. v. Meredith Corp., 88 F. 3d 473 (7th Cir. 1996). Courts as early as 1924 applied copy- right law in the context of recipes and found recipes to be copyrightable. As time went on and more courts looked at this issue, however, the ability to copyright a recipe has been dramatically limited. Now, a recipe must be accompanied by substantial literary expres- sion to even possibly be copyrightable.

In 1924, the Eighth Circuit addressed this issue. Fargo Mercantile Co. v. Brechet & Richter Co., 295 F. 823 (8th Cir. 1924). There, the plaintiff, a manu- facturer of fruit nectar, alleged that the defendant infringed the plaintiff’s copyright. Id. At issue was a label the plaintiff put on its bottles of fruit nectars. There were two parts to the label: (1) recipes and (2) an emblem. The recipes contained detailed directions for making certain food and drinks. The emblem was colorful and included plaintiff’s name and additional advertising material. The plaintiff copyrighted the entire label and alleged the defendant infringed the label and violated the Copyright Act. Id.

In evaluating plaintiff’s claim, the court examined the recipes and emblem separately. Regarding the recipes, the court stated “they are original composi- tions, and serve a useful purpose…” Id. Specifically, they serve to “advance culinary art.” Id. Importantly, the court stated that “[i]f printed on a single sheet, or as a booklet, these recipes could undoubtedly be copyrighted, and we see no reason why this pro- tection should be denied, simply because they are printed and used as a label.” Id. The Eighth Circuit held the recipe is copyrightable as an “original work of authorship.” Id. Notably, the court did not address the argument that the recipe was merely a factual recitation of a “procedure[]” or “process[]” that would not be copyrightable.

Fargo stands for the proposition that recipes are copyrightable as “original works of authorship.” The court in Fargo, unlike later courts, did not examine whether the recipe had additional commentary or needed the same in order to be copyrightable. Instead, the court simply held that recipes are copyrightable. Therefore, under Fargo, recipes that only include a list of ingredients with simple instructions appear to be protected by the Copyright Act.

In more modern times, the ability to copyright recipes has been limited. The Seventh Circuit had occasion to visit this issue over 70 years later and adopted a holding much different than its sister

circuit. In Publications Intern. Ltd. v. Meredith Corp., the court addressed whether copyright laws afford protection to recipes that are contained in a cookbook where the cookbook has a compilation copyright. 88 F. 3d 473 (7th Cir. 1996). There, both the plaintiff and defendant published magazines and books with recipes in them. Meredith published a cookbook titled Discover Dannon—50 Fabulous Recipes with Yogurt and received a copyright for the cookbook as a “collective work.” Id. In the copyright applica- tion, the defendant described the subject matter as a “compilation” of “recipes tested with Dannon yogurt.” Id. Meredith alleged that Publications International produced 12 publications containing recipes from the Discover Dannon cookbook that infringed upon its copyright. Id. Meredith argued its collective work copyright extended to the individual recipes within the cookbook. Id.

The court looked at the language of the Copyright Act of 1976, which requires that copyrightable work “possess some minimum indicia of creativity, that they be original intellectual conceptions of the author.” Section 102(a) includes literary works (like cookbooks) while Section 102(b) excludes things like processes, systems, and methods of operation (like recipes). A compilation copyright protects the order and manner of the presentation of the compilation’s elements (e.g. the order of recipes in the cookbook), but not necessarily the individual elements (e.g. the individual recipes).

In Publications, the recipes were found to be lists of required ingredients and directions for combining them in order to achieve the final result. They did not contain “expressive elaboration upon either of these functional components.” Publications, 88 F. 3d at 480. At its core, the court found the ingredient sections to be statements of facts. Id. Such functional listing was not original within the meaning of the Act. Regarding the directions, those were excluded under Section 102(b) as nothing more than the “process” for making the dish—something which is specifically excluded from copyright protection. Id. The court went on to state that there can be no monopoly in the method one might use in preparing and combining the nec- essary ingredients. Id. In other words, a bare recipe, without literary expression is not copyrightable. Id. It held open the question of whether certain recipes might be copyrightable, though, such as “dishes with musings about the spiritual nature of cooking…sug- gestions for presentations, advise on wine to go with the meal…” Id.

Publications takes several steps back from Fargo in protecting recipes through copyright. Under Publications, the list of ingredients in a recipe is a

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statement of facts devoid of any protectable expres- sive element. Additionally, the instructions in reci- pes, without expressive elaboration, are likewise not protectable because they describe a “procedure, process, system, method of operation” which is specifically excluded from copyright protection. 17 U.S.C. § 102(b). The court in Fargo did not put these restraints on the ability to copyright recipes. Under Publications, it is harder to copyright recipes, as they need to have sufficient creativity, expressive elabo- ration, and commentary. Under such a standard, a recipe that is written down by a chef or restaurant owner for use in the restaurant would likely not be copyrightable. On the other hand, a recipe prepared for a celebrity cookbook, with commentary, may be copyrightable.

The Sixth Circuit, just two years later, also examined this issue and went even further than Publications in limiting the ability to copyright recipes. In Lambing v. Godiva, the plaintiff claimed Godiva misappropri- ated her proprietary rights in her recipe and design of a chocolate truffle. 142 F. 3d 434 (6th Cir. 1998) (unpublished). Plaintiff argued Godiva violated her copyright by preparing and selling a truffle described in one of her recipes contained in an unpublished cookbook. Id. In a short opinion with little analysis, the court plainly stated, “Recipes…are not copyright- able.” Id. The court went on to say “the identification of ingredients necessary for the preparation of food is a statement of facts. There is no expressive element deserving copyright protection in each listing.” Id. Accordingly, the court held “recipes are functional directions for achieving a result” and are excluded from copyright protection. Id.

Unlike Publications, the Lambing court ignores the possibility that there could be sufficient expres- sive elements in a recipe that could make it protect- able. In Publications, the court found that no such expressive elements existed in the recipes in that case. In Lambing, the court does not even entertain such possibilities. It simply states “[r]ecipes…are not copyrightable.” Lambing, 142 F. 3d 434, at *1. This holding is much narrower than the holdings in Fargo or Publications. One could argue that a Circuit split exists on the issue of whether recipes are copyrightable. The Eighth Circuit has held that a recipe is copyrightable; the Sixth Circuit has held that a recipe is not copyrightable; and the Seventh Circuit has held that a recipe is not copyrightable if it is a functional list, but left open whether a recipe can be copyrightable if it contains musings, sugges- tions, or advice.

Publications is the more reasoned decision, and it has been followed in recent district court cases,

including in a case pending in the Southern District of Texas. There, the court adopted a holding similar to what Publications described as copyrightable— recipes that are more than mechanical listings and have sufficient expressiveness can be copyrightable. Barbour v. Head, 178 F. Supp. 2d 758 (S.D. Texas 2001). The plaintiff was the author of a cookbook titled Cowboy Chow for which he held a copyright. The defendant published an internet magazine with almost identical recipes that were in the cookbook. The plaintiffs alleged copyright infringement argu- ing what Publications said in dicta—“where a recipe or formula is accompanied by substantial literary expression in the form of an explanation or direc- tions…there may be a basis for copyright protection.” Id. The Cowboy Chow recipes contained various liter- ary anecdotes, such as “Heat oil in heavy skillet. Add sugar and let it brown and bubble. (This is the secret to the unique taste!)” and exclaiming that the Crazy Horse Cranberry Sauce with Raisins is “Great with all your meats!” Id. This “light hearted or helpful com- mentary” was included throughout the cookbook. Id. The court found there to be a genuine issue of material fact of whether the recipes were “sufficiently expressive” or merely “unprotected facts.” Id. Because the recipes were more than mechanical listings, it denied defendant’s motion for summary judgment and left a jury to decide. Id. The case ultimately settled so the question of whether these recipes were sufficiently expressive and, thus, copyrightable, was not answered.

Barbour follows exactly what Publications indi- cated would be protected by copyright—recipes with fluff. The bare bones recipes—recipes without anec- dotes or “substantial literary expression”—are not copyrightable, but recipes that contain expressive commentary may be copyrightable. This analysis by the courts makes it difficult to copyright recipes that are not contained in cookbooks, however, and meant to be sold to a wide audience. For instance, if a res- taurant has a signature dish that is a crowd-pleaser, but the restaurant does not publish a cookbook, the restaurant may not be able to copyright that recipe, and may not want to as it would have to publish its “secret” recipe. Presumably, the recipe is written down in the form of a list of ingredients and the steps to make the dish, and does not include anecdotes or substantial literary expression. In such a case, that recipe likely is not copyrightable.

Even when a restaurant’s signature dish is copy- rightable, business issues arise. If a restaurant has a signature dish and publishes a cookbook with enough “fluff”, the recipes themselves may be protected by copyright, but what good is that copyright? The

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recipes will be public and open for all to see. It will be near impossible to know if and when restaurants around the country put that recipe on their own menus. The solution to these business concerns is found not in copyright, but trade secret law.

Trade Secret Protection Unlike copyright, which does not protect an idea

itself, only its particular expression, trade secret law protects the author’s very ideas if they possess some novelty and are kept secret. The Uniform Trade Secrets Act, which has been adopted in almost all 50 states, sets out the parameters for what constitutes a trade secret. Under the Act, in order to constitute a trade secret and be entitled to protection, the information must derive “independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its dis- closure or use” and must be the “subject of efforts that are reasonable under the circumstances to maintain its secrecy.” Several courts have examined whether recipes constitute trade secrets, as examined below.

In Buffets, Inc. v. Klinke, owners of a buffet res- taurant chain brought an action against owners of a competing buffet restaurant for misappropriation of trade secret; specifically, its recipes for “basic American dishes” such as barbecue chicken and macaroni and cheese. 73 F.3d 965 (9th Cir. 1996). The court noted that trade secret law “protects the author’s very ideas if they possess some novelty and are undisclosed or disclosed only on the basis of con- fidentiality.” Id. Plaintiffs were forced to argue that novelty is not a requirement for trade secret protec- tion (as there is nothing novel about macaroni and cheese), which was unsupported by the case law. Id. Although the lower court found the plaintiffs’ recipes were more detailed than those of its competitors, it reasoned that details do not mandate a finding of novelty. Id. In contrast, the lower court concluded that even the detailed procedures were readily ascer- tainable. Id. Ultimately, the recipes and procedures were well-known in American cuisine, fairly basic, and could easily be discovered by others. They were, after all, food staples such as barbecue chicken and macaroni and cheese. The court found these to be little more than typical American fare that were not entitled to trade secret protection. Id. Finally, the plaintiffs failed to provide that it necessarily derived any benefit from the recipes being kept secret. Id. As such, the court held that the recipes did not warrant trade secret protection.

The court in Li v. Shuman found similarly. No. 5:14-cv-00030, 2016 WL 7217855 (W.D. Va. 2016). In that case, one party alleged common Asian dishes were trade secrets because the “process” for making them was novel. Id. The parties in Li were former business partners in an Asian restaurant venture. One of the plaintiffs was the head chef and, the creator of the alleged “secret recipes,” which he claimed were trade secrets. The court stated that recipes could be trade secrets, but that these recipes were not. Id. The court reasoned that a “crucial characteristic of a trade secret is secrecy rather than novelty.” Id. The recipes originated from two of the head chef’s friends and partners, but the head chef testified he incorporated his own taste. Id. He could not testify to anything specific he changed in the recipes, though, rather saying the secret was “the process.” Id. Even still, he could not identify what was proprietary about his process. Id. Instead, the head chef admitted that the recipes were common Asian dishes. Id. There was in fact no evidence how his recipes were any different than those generally known in the industry. Id. The lack of a secret ingredient is not fatal, but he could point to nothing that gave him a competitive edge. Accordingly, the court held that the head chef could not meet his burden that the information derived independent economic value from not being generally known or readily ascertainable. Id.

In light of Li, it is necessary to be able to show why the process is novel. To do so, it is imperative to identify the actual process. It is not enough to allege the “process” is a trade secret without more context, explanation, or identification. Even then, the process must be sufficiently different from the processes used in publicly available recipes.

The plaintiff in Vraiment Hospitality, LLC v. Todd Binkowski, et al. faced the same difficulties in prov- ing a recipe for salted caramel brownies was a trade secret. 8:11-CV-1240-T-33TGW, 2012 WL 1493737 (M.D. Fla. Mar. 19, 2012). There, the owner and operator of Amelie’s Bakery & Café brought suit against defendants for using Amelie’s salted caramel brownie recipe. Id. Plaintiffs claimed that the salted caramel brownie recipe was secret and moved for a preliminary injunction to stop the defendant from using it. Id. The plaintiff argued that its salted caramel brownie has been prepared using a unique combination of ingredients that it had kept secret. Id. In support, the plaintiff presented an affidavit from a former pastry chef who stated the recipe included a “secret” ingredient that gave the brownie its “distinguishing taste.” Id. The pastry chef tasted both parties’ brownies and opined that the defen- dant copied Amelie’s recipe as they had the same

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unique texture and taste, which she attributed to the secret ingredient. Id. Regarding secrecy, the plaintiff required its employees to sign confidentiality agree- ments. Id. The plaintiff divulged the secret ingredi- ent to the court, but the court was unimpressed by its purported uniqueness, as it was included in brownie recipes found on www.epicurious.com. Id. Accordingly, the court denied plaintiff’s motion for a preliminary injunction. Id.

Although these cases illustrate how difficult it can be to prove that a recipe is a trade secret, they also show that, in the right case, recipes can be entitled to trade secret protection. The case of Magistro v. J. Lou, Inc. is illustrative as to what a plaintiff will need to show to have a chance at prevailing in a trade secret case. 270 Neb. 438 (2005). In Magistro, the court found that a pizzeria’s dough and sauce recipes con- stituted trade secrets. Id. There, the owner of a pizza joint entered into a contract with the defendant allow- ing the defendant to operate a pizzeria under plain- tiff’s name and to use plaintiff’s “secret recipes.” Id. The defendant stopped paying royalties and changed the restaurant name, but continued using the recipes. Id. Ultimately, the issue in the case was not whether the dough and sauce recipes were trade secrets, but whether the defendant used the recipes in violation of the franchise agreements. Id. Nonetheless, the court concluded that the recipes were trade secrets. Id. According to the court, they derived independent economic value from not being known to others and the plaintiff made reasonable efforts to maintain their secrecy. Id. The plaintiff, however, still lost. The reason was because the plaintiff failed to establish that the defendant was using the secret recipes. Id. In other words, just establishing trade secret protection may not be enough. There will be significant proof problems in proving that a competitor is using a mis- appropriated secret recipe. The fact that the dishes taste similar will not be enough. Id.

The aforementioned cases demonstrate the dif- ficulty in proving that a recipe is a trade secret. At the outset, the recipe has to be novel, which is a

challenging task given the number and breadth of recipes the public can access. The analysis, accord- ing to the Vraiment court, is not necessarily whether other restaurants are serving the same dish as you, but whether anyone anywhere could be doing so. Moreover, it is difficult to discern whether someone misappropriated a recipe or whether he just relied on his experience and skill to come up with a similar recipe. Cooking is all about trial-and-error, which makes it hard to prove someone misappropriated a recipe. It seems possible that one could argue a recipe is different because the process for making the dish is different. Even there, it may be difficult to properly identify what makes a process secret and unique.

Conclusion Given the limitations of copyright and trade

secret law, the best protection for recipes are for the parties to agree on who is the rightful owner of a recipe (e.g., the chef or the restaurant) at the time of contracting with assignments and, if appropri- ate, non-disclosure agreements (which practically speaking are almost a requirement for trade secret protection). Of course, by the time a dispute arises that is ripe for litigation, it is too late to correct these mistakes. Given this reality, commercial litiga- tors must shape their arguments based on the facts they are given. In the copyright context, this can mean framing the recipe as merely a resuscitation of ingredients or focusing instead on the expressive words used in the resuscitation, depending on your side of the case. In the trade secret context, this means honing in on the steps taken (or not taken) to keep the recipe secret and the existence (or non- existence) of similar recipes in the public domain. Regardless of which side of a case you are on, the explosion of the foodie culture, the historical prac- tices of the restaurant business, and the evolving law in this area provide ample grounds to develop and put forward unique and persuasive arguments.

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