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When Wegmans opened its first grocery store in Manhattan last fall, hundreds of customers arrived to view an elaborate bluefin tuna butchering ceremony. The event was meant to commemorate the opening of an in-store fish counter called Sakanaya that offers fresh fish flown in from Japan.
But not everyone was celebrating. Yuji Haraguchi, who owns a nearby sushi and fish market called Osakana, says that Wegmans defrauded him and is violating his common law trademark. Haraguchi is now suing the Rochester, New York-based grocery chain and several of its partners for $1 million and demanding that Wegmans stop using the name Sakanaya, which is Japanese for "fish market."
According to a complaint in New York State's Supreme Court, Culimer USA, a Torrance, California-based importer and distributor of frozen Japanese seafood, approached Haraguchi in August 2023 about purchasing Osakana. At the time, Haraguchi had been looking for a buyer and planned to move to Hawaii, according to Grub Street. Along with Culimer, the suit names Wegmans and three of its partners: seafood supplier Culinary Collaborations, saucemaker Red Shell Sushi, and Japan-based seafood vendor Uoriki.
Haraguchi signed a nondisclosure agreement with Rochester-based Culinary Collaborations, and shared "financials, products, vendors, and business know-how." He claims that under the guise of conducting due diligence the companies named in the suit gained access to proprietary information and used it to create a competing business inside Wegmans. By the fall, Culimer informed Haraguchi it was no longer interested in purchasing his business.
Wegmans has said the complaint is "without merit." Still, the grocery chain is facing public criticism for appearing to mislead a minority small-business owner. Osakana's Change.org petition calling for Sakanaya to be shut down already has more than 3,000 signatures.
One of Haraguchi's key claims is that Wegmans is infringing on Osakana's common law trademark rights by operating a similar business with a similar name a few blocks from his own.
Christopher Kelly, a lawyer in the intellectual property group at Washington, D.C.-based law firm Wiley, says that common law trademarks, which are established through the use of a distinct term in a particular geographical area, are "perfectly enforceable."
Kelly says, "There's a common misconception that trademark registration either at the federal or state level creates trademark rights. It enhances trademark rights, but the rights in the United States are created through use."
He advises small-business owners to choose distinct names for their businesses and products, searching Google and trademark databases to be sure a preferred term isn't already taken. The U.S. Patent and Trademark Office has a database of federal trademarks, and in most states, the secretary of state's office maintains a database of state-level trademarks.
Haraguchi may have trouble convincing a judge that the name Osakana, a variation on the word for "fish," is distinct, or that Wegmans should be prevented from using the Japanese word for "fish store," according to Kelly.
"You generally can't stop somebody from using a generic term," says Kelly. However, if you're using a term that's not quite generic, but mostly descriptive, you can try to establish secondary meaning. That can be done through demonstrating use of the mark for an extended period of time (under federal trademark law, five years), proving that you've spent extensively on advertising and marketing under a particular name, or by conducting surveys to see if the public views a term as proprietary.
"You want to be able to show that when people see it, they don't see it as descriptive, they see it as your business," says Kelly. "If [Haraguchi] were able to show a court that they have actual bona fide confusion among the public in the marketplace, that certainly would strengthen his case."
Kelly says companies should consider registering their trademarks at the state or federal level. If your trademark is registered federally, you can use the registered trademark symbol (a letter R in a circle).
Anyone can use the TM or SM (service mark) symbol. "You're entitled to use those if you do not have a registration," says Kelly. "I always tell clients that they should use them even if they haven't registered [a term]. At the end of the day, maybe it's not protectable but at least it sends a message to the public that the business owner views this as a proprietary term."
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