PHILADELPHIA (CN) - A legal battle over stromboli is heating up after a federal judge refused to dismiss claims that a company used misleading packaging to land customers.
Philadelphia-based Leonetti's Frozen Foods says its competitor, American Kitchen Delights, makes a strombli with less meat and cheaper ingredients. But American Kitchen allegedly decorates its packages with pictures of Leonetti's stromboli.
Though Leonetti's claims to have made stromboli for Maglio Fresh Foods since the 1980s, Illinois-based American Kitchen allegedly took over the contract around November 2007. American Kitchen's stromboli, however, used "the same exact packaging" Leonetti's had used when it was distributing Maglio-brand stromboli, according to the complaint.
In addition to displaying images of Leonetti's stromboli, American Kitchen allegedly misrepresented that its stromboli had the same "ingredients and nutrition facts" as Leonetti's product.
American Kitchen's Maglio-brand stromboli products "misrepresent the nature, characteristics, and qualities of the stromboli products" it makes, which "are folded differently" and "have different ingredients and nutrition facts" than the Leonetti's stromboli depicted on American Kitchen's packaging, according to the complaint.
In an October 2011 complaint, Leonetti's claimed that American Kitchen's inaccurate packaging constitutes unfair competition under the Lanham Act.
American Kitchen's packages "have the purpose and effect of confusing customers, and increasing sales to the detriment of Leonetti's," the suit said.
It also said the U.S. Department of Agriculture investigated American Kitchen's labels around November 2010 and found a dozen labeling violations.
U.S. District Judge Thomas O'Neill Jr. ruled last week that Leonetti's can proceed with its Lanham Act claim, rejecting American Kitchen's motion to dismiss the suit as half-baked.
"Leonetti's amended complaint clearly alleges that the product photographed and described on the stromboli packaging used by American Kitchen was not identical to the stromboli that American Kitchen intended to deliver to its customers," he wrote. "Instead, it was identical to the stromboli manufactured by Leonetti's. Despite American Kitchen's contention that the stromboli photographs 'are generic,' the photographs on the box were clearly intended to represent the stromboli contained inside the boxes - the stromboli manufactured by American Kitchen - when, if Leonetti's allegations are true, they did not."
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