Farmhand Foods to change name to settle dispute

Apr. 29, 2013 @ 09:15 PM

Farmhand Foods, a Durham-based distributor of pasture-raised meat products from North Carolina farms, will change its name Wednesday to end a trademark dispute involving a Smithfield Foods Inc. pork products subsidiary.
Farmhand Foods initially launched in 2010 as a food truck, but is now focused on wholesale. The company has more than 60 buyers of pasture-raised North Carolina meat products, including restaurants, natural food grocery stores, food trucks and others, according to a news release. It sources meat from about 40 small-scale beef and pork producers.
In late 2011, the company received a “cease and desist” letter from S.F. Investments, Inc., a company that owns Farmland Foods, according to the release from Farmhand Foods. Both are subsidiaries of the Virginia-based hog producer and pork processor Smithfield Foods Inc., Keira Lombardo, vice president of investor relations and corporate communications for Smithfield Foods Inc., in an email.
For the third quarter of its fiscal year, Smithfield, Va.-based Smithfield Foods reported a net income of $81.5 million on sales of $3.6 billion. Its sales were up more than 3 percent in the quarter, driven by growth in packaged meat product sales.
According to information from Farmhand Foods, SF Investments asked that the Durham-based business immediately stop using the name “Farmhand Foods” and relinquish its domain name and associated marketing materials.
The company changed its website address to given the one-letter difference in domain names, according to the information. Durham-based Farmhand Foods also said in the release that it had received federal trademark protection for the right to use its mark. But Tina Prevatte, Farmhand Foods’ co-CEO, said that protection was not enough.
“So we were going to still be potentially in a lawsuit if we didn’t come to some kind of agreement with them,” she said.
Prevatte said the company’s attorney advised them that it was not a clear-cut case, and winning a potential lawsuit was not guaranteed. She said they were considering whether they’d been tied up in a dispute for years, racking up legal fees.
On Wednesday, the company plans to change its name to Firsthand Foods. The name conveys a “direct and transparent” connection between small-scale, pasture-based livestock producers, and restaurant and retail partners, Prevatte said. She said they’re also keeping the look and feel of their logo so they won’t see disruption in the brand recognition they’ve been working to build.
“After a year of trying to protect the rights to use our name, we decided to embrace Firsthand Foods as our new name and focus on growing our markets, supporting the farmers in our network, and continuing to help build a robust local food system here in North Carolina,” she said in a statement in the release.
Lombardo said in an email that the trademark dispute between Farmhand Foods and SF Investments was “amicably resolved” under a confidential settlement agreement that involved Farmhand transitioning to a new name.
It had taken several months to come up with the original name of Farmhand Foods, Prevatte said. She said they were not aware of Farmland Foods at the time. But even if they had, she said she doesn’t know if they would have given the company a different name.
“Because we’ve never felt like there was potential for confusion,” said Prevatte, who said the “essential legal question” in a trademark dispute is whether there is room for consumer confusion.
The soon-to-be Firsthand Foods hit its second year in the wholesale business in March, Prevatte said. She said the business’ sales from year one to year two tripled. She said she expects to see sales exceed $1 million this year.
“It was an indication of the amount of pent-up demand that there had been in the restaurant community, in particular, for a mission-driven business that was making it easy for them to support their local farms, and source a consistent and quality supply of pasture-raised pork and beef,” she said of the growth.
Prevatte said she initially got started with the business while working toward a dual degree from the University of North Carolina at Chapel Hill Kenan-Flagler Business School and the UNC Department of City & Regional Planning.
The co-CEO of the company is Jennifer Curtis, project director of NC Choices, an initiative of the Center for Environmental Farming Systems working to promote pasture-based meat supply chains. The organization provided grant funding to help launch the business, Prevatte said.
“All these farmers (were) sustainably raising their animals, and all these chefs and retailers (were) interested in supporting them, but there was nobody in the middle facilitating that and making it easy and a smooth process for the different ends of the supply chain,” she said.
The company now operates out of space in The Eco Hub on Pettigrew Street in Durham. The building is the distribution center for the organic produce distribution company Eastern Carolina Organics, but the company also made space available for rent for like-minded young companies and nonprofits.
Firsthand Foods has an office in the building, and also has space for cold storage. Prevatte said the company now uses its Sausage Wagon food truck to market products to consumers, after making a decision to focus resources on wholesale.
“I think we always viewed the Sausage Wagon as, I would call it our ‘community engagement tool,’ as a way that we let folks know about the brand and what we’re doing and to get them excited about our products,” she said.