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Whose chicken is it anyway? A brief look at the doctrine of exhaustion of rights

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  5. Whose chicken is it anyway? A brief look at the doctrine of exhaustion of rights

Published Date: October 17, 2017

Mashable reports:

“Sweet Dixie Kitchen in Long Beach, California is at the centre of a controversy after a disappointed customer revealed that its chicken sandwich was created using Popeyes chicken. The drama has since been called POPEYEGATE!

The facts are relatively simple here, Sweet Dixie is a southern inspired dining experience in the heart of Long Beach, California that cannot fry chicken on its own premises. This is an issue for them because a southern inspired restaurant without fried chicken is a bit like a sports bar that cannot pour beer – you will have a lot of disappointed customers.

Sweet Dixie‘s solution to this problem was a simple one – bring in the fried chicken from the popular chain Popeye’s to make your famous fried chicken sandwich. The only problem with this plan is that when Sweet Dixie’s customers found out that their $12.50 sandwich relies on Popeye’s fried chicken as its key ingredient they were extremely unhappy. A brief extract from a once-happy customer follows:

“We went again very recently (about two weeks ago) and I ended up ordering the chicken and waffles. I did enjoy myself and I left my meal pleased. However, I am not happy recently learning that the chicken was from a fast food restaurant chain, Popeyes.  I must say that I feel like I was lied to as this was not explicitly told to me in the menu or by the waitstaff (although I didn’t even think to ask, because why would I need to?). Unfortunately, I’m not sure I can trust anything coming from the kitchen at this time.” 

I’ve got no Michelin stars to my name but an easy conclusion to come to is that this probably isn’t the best way to make a fried chicken sandwich.

But can Sweet Dixie legally do this? This is a law blog so let’s look at the legal doctrine of exhaustion of rights or “first sale principle”.

The basis of the exhaustion of rights doctrine is that the sale of a product extinguishes the seller’s right to control the movement of the product after the article is first sold. In other words, once I buy a bucket of fried chicken from Popeyes I can resell the individual pieces of chicken or use it as a sandwich filling.

A caveat to this principle is that if you violate any other intellectual property rights in the process you may be held liable i.e. if you infringe the copyright, trade marks or other rights of the original seller.

It sounds as though Sweet Dixie made no representations about the origins of their chicken and thus cannot be held liable from IP perspective, at least as far as South African law is concerned.

There are probably a number of other angles to tackle this storm in a teacup from, particularly from an online reputation management point of view, but I’m hungry for a fried chicken sandwich so will sign off here.

By Nic Rosslee

Photo by Brian Chan on Unsplash

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