IP Law Daily, TRADEMARK—S.D.N.Y.: Dismissal largely denied in pistachio packaging dispute, (Mar 30, 2026)

By Kevin M. Finson, J.D.

In a case involving packaging of pistachios, counterclaims for invalidity, non-infringement, and cancellation of trade dress survived a motion to dismiss because they put the defendant on notice and were sufficiently detailed.

In a heavily litigated case on nut packaging, a seller of nuts plausibly alleged several counterclaims asserted against a competitor who sued for trade dress infringement, the U.S. District Court in New York City has held. Nut Cravings, Inc. (Nut Cravings), the company that brought counterclaims, is a New York-based distributor and retailer of nuts, fruits, and gift packages. Its false advertising counterclaim, however, failed for a lack of connection between the alleged false statement and the damages. As a result, the motion to dismiss was denied in part and granted in part (The Wonderful Co. LLC v. Nut Cravings Inc., No. 1:21-cv-03960-MKV-RWL (S.D.N.Y. Mar. 24, 2026)).

The Wonderful Company, LLC and Cal Pure Produce, Inc. (collectively, TWC) are in the business of selling pistachios. TWC alleges that it is the owner of trade dress for its product packaging for pistachio nuts as reflected by its trade dress registration. They brought suit against Nut Cravings for trade dress infringement. Nut Cravings counterclaimed for declaratory judgment of non-infringement, declaratory judgment of invalidity, cancellation of TWC’s registered trade dress, and false advertising. TWC moved to dismiss the counterclaims.

Duplication. TWC argued that the declaratory judgment claims were duplicative and unnecessary in light of TWC’s own claims for infringement. The court held that they were not duplicative and could conceivably become necessary in the event that TWC dismissed its claims, so dismissal was inappropriate.

Invalidity. TWC argued that Nut Cravings failed to allege the trade dress was functional. Reviewing the complaint, the court found that Nut Cravings had gone down the claimed dress element by element and alleged that each item, including the color scheme, had functional benefits apart from indicating the source.

Cancellation. The court noted that the allegations as to industry custom used to assert genericness of the registered dress were thin but held that they were sufficient for the pleading stage and would be developed through discovery.

False advertising. The court found that Nut Cravings had failed to plausibly allege damages arising from the alleged false statement of the quantity of edible nuts in TWC’s product. The connection between the alleged false statement and any injury was alleged only in conclusory terms and was highly speculative.

The court dismissed the false advertising claim but otherwise denied the motion.

The Case is No. 1:21-cv-03960-MKV-RWL.

Judge: Vyskocil, M.

Attorneys: Robert T. Maldonado (Wolf Greenfield & Sacks, P.C.) and Alexis Golling-Sledge (Roll Law Group) for The Wonderful Co. LLC and Cal Pure Produce Inc. Mark Berkowitz (Tarter Krinsky & Drogin LLP) for Nut Cravings Inc.

Companies: The Wonderful Co. LLC; Cal Pure Produce Inc.; Nut Cravings Inc.

Cases: Trademark NewYorkNews