E. & J. Gallo forces Asheville company to change name

ASHEVILLE – A small local food company has run afoul of a wine-making behemoth.

Husband-and-wife team Tom Gallo and Susan Devitt have been forced by E. & J. Gallo Winery to change the name of their small company from “GalloLea Pizza Kits” to “BelloLea Artisan Kitchen.” The name change is a result of a December 2012 accusation in that the small, Asheville-based company was infringing on the California winery’s trademark.

E. & J. Gallo Winery is the largest exporter of California wine, and one of the largest wineries in the world. Dozens of brands fall under the company’s label, including Barefoot Wine, Turning Leaf, Carlo Rossi and Boone’s Farm.

Tom Gallo, half of the GalloLea moniker (the other half belongs to a family friend), said he was, at first, determined to continue to use his family name on his pizza kit, which incorporates his grandmother’s pizza sauce recipe.

“But that was before we understood how things progress,” said Devitt, noting the Gallo brothers’ history of litigious behavior.

In 1989, Ernest and Julio Gallo won a lawsuit against their own younger brother, Joseph, to prevent him from using his own name on his brand of cheese.

According to a 1989 Los Angeles Times article about the contentious three-year legal battle, the wine-making Gallos “accused their brother of running a rat-infested cheese plant; lawyers for Joseph Gallo, the cheese maker, countered with accusations that his brothers made cheap wine to sell to drunks.”

A fighting chance?

After being approached by the winery, Gallo and Devitt sought legal counsel, figuring their small business had a fighting chance to win the argument and the name.

“We thought we were fine because we were in a completely different class in the world of trademarks,” said Devitt, adding that her company was trademarked in Class 30 under Pizza Kits. “E. & J. Gallo Winery does not sell anything in Class 30,” she said.

But that doesn’t matter to E. & J. Gallo Winery, which settled a suit in the early 2000s to keep Spanish pasta company, Gallo Pasta, from selling its product in the U.S. Gallo, pronounced “guy-oh” in Spanish, means “rooster.”

When E. & J. Gallo discovered in 2009 that a small Seattle store, The Spanish Table, was selling the product, the winery’s lawyers delivered a cease and desist order informing the owners of the mom-and-pop shop that they would be sued, unless they removed the pasta from their shelves.

The Spanish Table agreed to remove the products, but not before publishing a huge ad in the Seattle Times sharing the settlement offer Gallo made.

Tom Gallo and Devitt were refused requests for a settlement to cover the cost of re-packaging their product, they said.

“We also tried to settle with them by saying we would not trademark our name, we just wanted to use it, and we went back and forth with them quite a bit,” said Devitt.

Devitt said that the winery agreed to let the couple use the name — with some stipulations.

The couple would have to promise they would not grow the business more than 20 percent beyond where it was in 2013, and that they would never make anything other than pizza kits. Further, the winery would have to vet any potential investors before they bought into GalloLea.

“You get to this point where you realize that this is just going to go on and on,” said Devitt. “They have a legal department that needs projects, and we just felt like eventually there was no way that we could really win it.”

Back to the drawing board

Even with the legal battle behind them, the couple has to work on creating new packaging and marketing materials. “Everything has to change,” said Devitt. “Every time I turn around, I think, ‘Oh, I have to update that.’ It’s a ton of work, and losing all of that traction is really devastating.”

The couple estimates they’ve lost an estimated $140,000 in legal fees, marketing and new-packaging costs. “For us that’s devastating,” said Tom Gallo.

“That’s just part of business in the huge corporate world,” said Devitt.

Although they are satisfied with the new name, Devitt said losing her husband’s family name on the product comes at an emotional cost that extends beyond the legal fight.

The owners of the former Amazing Savings grocery stores had a similar yet opposite problem in 2012 when a New Jersey-based company, Simply Amazing, threatened legal action if the artisan and discount grocery store did not change its name. Rather than face a lengthy legal battle, the owners turned Amazing Savings into Hopey & Co.

“The only reason we went with Hopey and company is because it’s our family name,” said Troy Hopey.

Hopey said that his company “took a knee and surrendered” by taking its website down and re-branding.

The immediate cost of new signs and logos on trucks and other company-branded paraphernalia, he said, was tough to swallow. “Every business is different,” he said. “But yes, it hurt us.”

But Hopey said that, with social media making it easier for companies to communicate with their audiences, a re-branding is no longer the death knell that it used to be. His prognosis for Devitt and Gallo is positive.

“Once they get over the hump ... the long-term will be sunny for them,” said Hopey. “If you’re plugged in and part of the community, honest and fair, you’re always going to have a market when your business is founded on the right principles.”

For more information about BelloLea, visit www.bellolea.com.