Miracle-Gro Sues Small N.J. Organic Plant-Food Maker

[Guest guest]

what, they used flowers and vegetables on their label? don't they know thats a

registered trademark

*sigh*

 

Miracle-Gro Sues Small N.J. Organic Plant-Food Maker

 

 

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April 30, 2007 — By Angela Delli Santi, Associated Press

 

TRENTON, N.J. -- The makers of garden products Miracle-Gro and TerraCycle are as

different as mature plants and seedlings.

 

The Scotts Miracle-Gro Co. is a $7 billion global business with broad brand

recognition, a 59 percent market share, and Roman columns framing the entry to

its corporate headquarters. TerraCycle Inc. is a fledging startup with $1.5

million in annual sales, an infinitesimal share of the market, and a

graffiti-covered warehouse with used tires on the lawn where the rose bushes

were before someone stole them out of the ground.

 

But Scotts sees similarities between the two plant-food makers. So, the Goliath

of plant products sued late last month, accusing TerraCycle of copying its look

and falsely claiming that its organic products are better than synthetic ones

like Miracle-Gro.

 

" I don't think their claims are valid, " said TerraCycle CEO Tom Szaky, a

25-year-old Hungarian-born entrepreneur who dropped out of Princeton in 2003 to

launch an eco-friendly company. TerraCycle's products are made from worm waste

and packaged in used plastic bottles and jugs.

 

" They're claiming that (the colors) yellow and green are theirs, " he said,

referring to Scotts.

 

He added, " Miracle-Gro has sued us over advertising. I've never bought an ad. "

 

TerraCycle's only lawyer, Richard Ober, calls the action by Miracle-Gro a

bullying tactic and has vowed to fight.

 

The suit in U.S. District Court here could doom the little green plant-product

maker.

 

Miracle-Gro, based in Marysville, Ohio, is seeking unspecified monetary damages,

changes in TerraCycle's packaging and an order to stop allegedly deceptive

advertising claims.

 

Trenton-based TerraCycle, which has yet to turn a profit, has created the

TerraCycle Defense Fund through its Web site to help defray legal costs.

 

Scotts spokeswoman Su Lok said the company's size doesn't matter. Miracle-Gro

aggressively protects its brand, she said.

 

" It doesn't really matter who the company is, large or small, we take our brand

and the products behind it very seriously, " Lok said.

 

A marketing truism states that shoppers often decide which consumer items to buy

while standing in the store aisle, which makes the look of a package an

important factor.

 

Alan Cooper, a Washington lawyer specializing in trademark law and unfair

competition, said companies protect their brand identity so consumers don't get

confused about which product they're buying.

 

" It's important because the packaging and brand identity are how a consumer

identifies these products, " Cooper said. " If they're pleased with a product, it

enables them to make repeat purchases. Or if they're not pleased, it allows them

to avoid the product in the future. "

 

TerraCycle's answer to Miracle-Gro's 177-page complaint is due May 2.

 

In its complaint, Scotts claims TerraCycle willfully infringed on Miracle-Gro's

" distinctive and famous " look, mimicking its yellow and green packaging and

including a picture of flowers and vegetables on its label. Miracle-Gro claims

that the packaging similarities could lead to consumer confusion between the two

companies' products.

 

" TerraCycle has passed off its goods as those of Scotts, " the suit alleges.

 

The plant-food giant also accuses TerraCycle of making false and misleading

advertising claims on its Web site and at point-of-purchase displays.

 

For example, Miracle-Gro claims there is no scientific basis for TerraCycle's

claim that it " outgrows synthetic fertilizers, " or that it makes " the most

effective, convenient, affordable plant you can buy. "

 

Ober said TerraCycle's products were tested against industry leaders at Rutgers

University's environmental research center. When Miracle-Gro lawyers asked to

see the details of the tests, TerraCycle declined. Miracle-Gro also refused to

turn over results of its product tests to TerraCycle, Ober said.

 

Szaky thinks TerraCycle became a threat to the plant-product powerhouse when it

secured coveted shelf space alongside Miracle-Gro in Home Depot and Wal-Mart

stores last year.

 

" I guess in a way it's an honor to be sued, " Szaky said. " I'd rather not, but I

guess it means 'you've arrived.' "

 

------

 

On the Net:

 

TerraCycle Inc.: http://www.terracycle.net

 

TerraCycle Defense Fund: http://www.suedbyscotts.com

 

The Scotts Miracle-Gro Co.: http://www.scotts.com

 

Source: Associated Press