** This article was drafted by Logan Woodward, a Summer Associate in NRF’s Minneapolis Office.  Logan is supervised by attorneys who are licensed in the State of Texas.

After a two-year feud, Mars Wrigley (“Wrigley”), the maker of the popular rainbow-colored Skittles candies, recently settled its lawsuit with Terphogz LLC (“Terphogz”) regarding its use of the ZKITTLEZ and similar marks in connection with the cannabis genetics Terphogz licenses to cultivators.[1]

In May 2021, Wrigley filed a complaint in the United States District Court for the Northern District of Illinois alleging that Terphogz’s use of its ZKITTLEZ, TAZTETHEZTRAINBRO, ZKITTLEZ HEMP, ZKITTLEZ HEMP & Cloud Design, and Z logo marks (collectively the “ZKITTLEZ Marks”) on packaging for cannabis products and clothing constituted trademark infringement of the famous SKITTLES, TASTE THE RAINBOW, and S logo marks (collectively the “SKITTLES Marks”). Wrigley argued that, overall, the SKITTLES Marks and ZKITTLEZ Marks are substantially identical in sight, sound, meaning, and commercial impression. Wrigley also accused Terphogz of undermining 50 years of goodwill fostered by the SKITTLES brand with the “freewheeling use” of SKITTLES Marks that have resulted in enormous profits for the cannabis brand through the sale of rainbow-themed cannabis, drug paraphernalia, and similar products.

A comparison of SKITTLES products and ZKITTLZ products is below:

Source: Am. Compl. at p. 2.

Source: Am. Compl. at p. 3-7.

In addition to the claims of trademark infringement, Wrigley highlighted the danger that Terphogz’s tactics pose to children who may confuse the cannabis-laced products with the popular SKITTLES candy. Many states that have legalized cannabis, including Illinois, have enacted legislation that prohibits cannabis companies like Terphogz from imitating candy labeling or packaging.[2]

Wrigley ultimately sought monetary damages, asked for a permanent injunction on the sale of any products using the ZKITTLEZ Marks, destruction of ZKITTLES branded products, transfer of the Zkittlez.com domain name, and for all ZKITTLEZ social media accounts to be disabled. Terphogz’s attempt to dismiss the case in November 2021 for lack of personal jurisdiction and venue was denied.

Under a proposed permanent injunction filed earlier this week, Terphogz agreed to not use SKITTLES, ZKITTLEZ, or any other similar marks in connection with its cannabis-related products. Terphogz also agreed to refrain from using slogans such as “Taste the Z Train” and “Taste the Strain Bro,” which Wrigley argued were too similar to the famous SKITTLES slogan and trademark, TASTE THE RAINBOW. Lastly, Terphogz agreed to give up the domain name www.zkittlez.com, though the company can still use the letter “Z” generally if it will not cause consumer confusion. The settlement will now go to the court for approval.

[1] WM. Wrigley Jr. Co. v. Terphogz, LLC, et al., No. 1:21-cv-02357 (N.D. Ill. May 3, 2021).

[2] See 410 Ill. Comp. Stat. 705/55-20-55-21.