Viacom Sues Over ‘Krusty Krab’ Trademark Application

Viacom files trademark infringement suit to stop Texas-based company from opening a 'Krusty Krab' restaurant
February 10, 2016

Viacom may have dipped its toes into the restaurant business before with the 1996 opening of Bubba Gump Shrimp Co. (named after a popular character from the film Forrest Gump)[1], but it has yet to chart the same course with a staple of the children’s series Spongebob Squarepants. However, in a lawsuit filed on January 29 against IJR Capital Investments, LLC, Viacom made it very clear that the idea of transforming the Krusty Krab into a real-world eating establishment is not up for grabs.[2]

The Krusty Krab, according to Viacom, is the “well-known fictional fast food restaurant” that appears in 249 episodes of Spongebob Squarepants. SpongeBob, the Nickelodeon show’s main character, is the Krusty Krab’s faithful fry cook.[3] Texas-based IJR Capital Investments, LLC (“IJR”) filed an application with the U.S. Patent and Trademark Office on December 3, 2014 for the service mark “The Krusty Krab.”[4] The application intended to register the mark for “restaurant services.”[5]

In filing its lawsuit, Viacom argued that the company has consistently capitalized on the use of “The Krusty Krab.”[6] These pre-existing uses include “playsets, cake decorations, aquarium ornaments, magnet sets, costumes, and more . . . .”[7] Viacom further claims that this demonstrated “extensive use of the ‘Krusty Krab’ mark . . . and the fact that the ‘Krusty Krab’ is a restaurant in the SpongeBob universe” puts the idea of Viacom opening a real-life “Krusty Krab” restaurant “within the zone of natural expansion of Viacom business.”[8] Viacom further alleges that granting the service mark to IJR would result in consumer confusion as to the source of the infringing mark.[9]

In a response to Viacom’s cease and desist letter, IJR’s lawyers argue that no likelihood of consumer confusion exists in this case.[10] Essentially, IJR argues that Viacom has no trademark rights associated with “The Krusty Krab,” that IJR’s services are distinguishable from those of Viacom, and that no actual consumer confusion exists.[11] Therefore, they refused to cease use of the mark.

A similar situation occurred in 2014, when Sony challenged another Texas-based eatery named “Ricky Bobby Sports Saloon & Restaurant,” based off of the 2006 film Talladega Nights: The Ballad of Ricky Bobby.[12] With no updates on the progression of that case, only time will tell how the current Viacom issue will play out. However, it seems more plausible that Viacom would be interested in opening a real-world version of “The Krusty Krab” than Sony would be in opening a restaurant with a theme drawn from a slapstick racing comedy. It is likely that Viacom will put a lot of its weight behind its “zone of natural expansion” argument.

As an interesting side note, this is not the first real-world “Krusty Krab” to emerge. A near exact replica of the cartoon restaurant featuring employees in character costumes was opened in Ramallah, Palestine in 2014.[13] However, Viacom has not instigated any legal action against the proprietors.[14]


[1] Company, Bubba Gump Shrimp Co., http://www.bubbagump.com/company.asp (last visited Feb. 10, 2016).

[2] See Eriq Gardner, Viacom Sues Owner of “Krusty Krab” Restaurant for Violating SpongeBob Rights, Thr, Esq. (Jan. 29, 2016, 3:51 PM), http://www.hollywoodreporter.com/thr-esq/viacom-sues-owner-krusty-krab-860480.

[3] See id.

[4] U.S. Trademark Application Serial No. 86470477 (filed Dec. 3, 2014).

[5] Id.

[6] See Eriq Gardner, supra note 2.

[7] Id.

[8] Id.

[9] See id.

[10] Letter from Ben T. Lila, Mandour & Assoc., APC, to Andrew Hughes, Counsel, Viacom (Nov. 25, 2015) (available at http://www.houstonpress.com/restaurants/viacom-sues-houston-firm-says-it-cant-use-the-krusty-krab-name-from-spongebob-squarepants-8119827).

[11] See id.

[12] See Eriq Gardner, Sony Wants to Put the Brakes on a ‘Ricky Bobby’ Saloon, Thr Esq. (Mar. 7, 2014, 11:26 AM), http://www.hollywoodreporter.com/thr-esq/sony-wants-put-brakes-a-686772.

[13] Soraya Nadia McDonald, ‘SpongeBob’s’ Krusty Krab is Opening – in the West Bank, Wash. Post, July 22, 2014, https://www.washingtonpost.com/news/morning-mix/wp/2014/07/22/spongebobs-krusty-krab-is-opening-in-palestine/.

[14] See Eriq Gardner, supra note 2.

Nathan Ranns

is a 2L interested in all things intellectual property and entertainment law. He is particularly passionate about the music industry, with prior experience at an indie label and the RIAA. He hopes to one day fulfill his dream of filing T. Swift’s trademark registrations (and also being her BFF).