Celebrity Vegan Chef Settles ‘By Chloe’ Intellectual Property Dispute With Investors

A staff member prepares food at the By Chloe restaurant in London on August 3, 2020. REUTERS/John Sibley

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  • Chloe Coscarelli says investors profited from misuse of her name
  • Investors said the lawsuit was a misdirected effort to drag them into a pre-existing dispute
  • Is the latest development in the Chief’s long-running litigation saga

(Reuters) – Celebrity chef Chloe Coscarelli has settled a lawsuit against several investors in vegan fast-food chain “By Chloe” who allegedly misused her name after she was kicked out of the business by co-owner ESquared Hospitality, a filing shows. Tuesday in federal court in Manhattan.

Coscarelli has accused units of Bain Capital, Kitchen Fund and other investment firms of enabling infringement of the ESquared trademark by contributing more than $30 million to the firm which ‘processed’ his name without permission .

Both ESquared and the investors said the channel had the legal right to use the “By Chloe” name.

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Tuesday’s filing asked the court to dismiss the case. Coscarelli’s attorney, Ron Schutz of Robins Kaplan, said Wednesday that the confidential settlement resolves all of the parties’ issues.

Investors and their attorneys did not immediately respond to requests for comment.

Coscarelli shot to fame as a vegan chef after winning Cupcake Wars on Food Network and writing a bestselling cookbook. His company, Chef Chloe, has entered into a joint venture with ESquared to open “By Chloe” restaurants.

Coscarelli accused ESquared of conspiring to improperly buy Chef Chloe’s stake in the company for “zero dollars” and securing more than $30 million in funding from investors soon after to expand the franchise.

An arbitrator reinstated Coscarelli’s 50% stake in 2020, awarding him more than $2.2 million in attorneys’ fees and costs.

The investors “exploited Chloe’s name to maximize their own financial interests while denying Chloe the opportunity to benefit from the business she created that bore her name,” according to her lawsuit against them.

By Chloe’s parent company filed for bankruptcy at the end of 2020 and a group including some of the investors bought the assets from the bankruptcy chain last year. The assets did not include the “By Chloe” brand, and the group renamed the channel Beatnic.

Investors previously told the court that the lawsuit was a “misdirected effort” to “belatedly and baselessly drag a group of minority investors into pre-existing disputes with their original business partner.”

Coscarelli has entered into an agreement with Collab+Consumer Fund I LP and Lion/BC LLC in addition to Bain Double Impact Fund LP and Kitchen Fund LP.

The case is Coscarelli v. Bain Double Impact Fund LP, US District Court for the Southern District of New York, No. 1:21-cv-04159.

For Coscarelli: Ron Schutz and Patrick Arenz of Robins Kaplan

For Bain Capital: Robert Jones of Ropes & Gray

For the kitchen base: Eli Richlin of Wilson Sonsini Goodrich & Rosati

For Collab+Consumer: Richard Scherer from Lippes Mathias Wexler Friedman

For Lion/BC: Jacklyn Siegel of Davis+Gilbert

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Blake Brittain

Thomson Reuters

Blake Brittain reports on intellectual property law, including patents, trademarks, copyrights and trade secrets. Contact him at [email protected]

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