Gallo vs The Spanish Table: David vs Goliath, Big Wine Goes after Small Retailer

David vs Goliath, Big Wine Goes after Small Retailer

Industry giant Ernest & Julio Gallo is suing a Seattle retail wine & specialty food retailer over pasta. The Spanish Table, which operates four retail locations, opened their Seattle store near Pike Place Market in 1995. This January, owners Sharon Baden and Steve Winston received a letter from a lawyer representing EJ Gallo, stating that unless they stopped selling the “Gallo” brand of pasta, which is imported from Italy (and not related to the wine company), they would be sued. (Apparently the pasta brand is pronounced differently - it is pronounced "guy-o.")

When I spoke with Winston, he expressed shock and dismay that the first contact he would have would come from a lawyer. Winston said that if someone from EJ Gallo had simply called to have a conversation regarding their concerns, he would have been open to it. Regardless, he states that they were still willing to stop selling the pasta, not because they felt that was right, but simply because they didn’t feel that a legal fight was worth it. Baden and Winston say that they contacted the Gallo attorney asking if "they preferred that we donate the pasta to a food bank or destroy it."

Then things got a little messy. The couple told me that it seemed that Gallo was willing to drop the threat of a law suit if the couple would disclose the name of the importer. Baden & Winston say they declined, and things went downhill. They stated that the Gallo attorney would no longer communicate with them at all, only with their attorney, in essence, forcing them to hire one. They say that they were given an April 16^th deadline to hire an attorney and cease pasta sales, however, Gallo officially filed suit ahead of their own deadline on April 14^th.

Baden "wonders why we were dragged into this at all, after all we are just retailers, we don’t produce the pasta nor have any control over the name." Gallo Pasta has been made for decades in Italy and is quite popular with their customers. Baden said that The Spanish Table customers have been very supportive and have "expressed outrage at the actions taken by EJ Gallo." The publicity surrounding the story has caused the remaining pasta to fly off the shelves.

KING 5 News in Seattle, says that The Gallo Winery released a statement to them. "The Gallo brand is known, recognized and trusted throughout the world. The brand represents our promise to the wine consumer that there are Gallo family members involved in the business who are passionate about making wine, who care about the quality and are involved in every detail to ensure that the consumer is receiving the best quality wine. Thus, we must always protect the image of our brand and the promise it represents," says Susan Hensley, Vice President of Public Relations for the E. & J. Gallo Winery.

The Modesto Bee reported that Susan Hensley said E.&J. Gallo is merely protecting a valuable brand.

"Like many companies, we have understandings with companies around the world to not sell or market products in the United States under the 'Gallo' brand," she said in a written statement. "We have such an understanding with the Gallo pasta producer. Given this understanding, whenever we discover the product is being sold in the United States contrary to this understanding, we must take steps to correct the problem."

Hensley added that the matter likely "will be quickly resolved."

Modesto Bee reporter John Holland also wrote that this isn't the first time that the winery has sued to protect its name. Founders Ernest and Julio Gallo sought in 1986 to keep their brother Joseph from marketing cheese from Atwater under the "Joseph Gallo" name. They prevailed, and the cheese today is known as "Joseph Farms."

We'd like to know what you in the industry think, please take a moment and share your opinion.

-Margie