IRVINE, Calif.–LAWFUEL – The Legal Newswire – El Pollo Loco, Inc., a quick-service restaurant chain specializing in flame-grilled chicken, today announced that a Laredo, Texas jury reached a verdict in a trademark lawsuit filed by El Pollo Loco-Mexico against El Pollo Loco, Inc. in 2004. On July 26, 2007, the jury returned a verdict finding damages for El Pollo Loco-Mexico, based on theories under Mexican law, in the approximate amount of $22 million.
Before a final judgment is rendered, the U.S. District Court in the Southern District of Texas has requested that the parties file post trial motions. The motions must be filed by August 9, 2007.
The contractual rights to use the name El Pollo Loco® and certain related trademarks and intellectual property in Mexico were assigned to El Pollo Loco, Inc. in 1996, pursuant to an agreement between El Pollo Loco, Inc. and a company controlled by Juan Francisco Ochoa, founder of the first El Pollo Loco in Mexico and the United States. In March of 2004, El Pollo Loco-Mexico filed a lawsuit alleging that El Pollo Loco, Inc. breached its agreement in Mexico by failing to exploit the trademarks and to develop new restaurants there.
Post trial motions to be filed by El Pollo Loco, Inc. will cite two key findings by the jury that reinforce its firm belief that the damage findings were not supported by the facts in this case as a matter of law. The first is that the plaintiff knew of the injuries it alleged as early as 1997, but did not file a lawsuit until 2004, which El Pollo Loco, Inc. asserts was after the statute of limitations had run. The second is that the value of the 1996 agreement was $1,087,500. El Pollo Loco, Inc. deposited the same amount into the registry of the Court two years ago, representing the buyout price in the contract.
The Company is hopeful that the trial judge will recognize the significance of the above jury findings and enter judgment in favor of El Pollo Loco, Inc. If the final ruling by the Court upholds the jury’s damage findings, El Pollo Loco, Inc. will appeal.
“We disagree with the jury’s decision and believe that it is not supported by the facts in this case as a matter of law,” said Steve Carley, president and CEO of El Pollo Loco, Inc. “There are a number of inconsistencies in the jury verdict that we plan to address in post trial motions, which could affect how the Court ultimately rules on this case. Additionally, in the event that the Court upholds the jury’s verdict, we plan to appeal and seek to have the ruling overturned by a higher Court.”
About the Company
El Pollo Loco is the nation’s leading restaurant concept specializing in flame-grilled chicken. Headquartered in Irvine, California, El Pollo Loco operates a restaurant system currently consisting of 156 company-operated and 214 franchised restaurants located primarily in California, with additional restaurants in Arizona, Nevada, Texas, Colorado, Illinois, and Connecticut. El Pollo Loco’s menu features the company’s signature citrus-marinated, flame-grilled chicken in individual and family-size meals and also offers a variety of contemporary, Mexican-inspired entrees, featuring the company’s signature chicken as the central ingredient, including its specialty Pollo Bowl® entrees, Pollo Salads, signature burritos, tacos, quesadillas, Chicken Nachos, and Chicken Tortilla Soup. The chicken is served with flour or corn tortillas, freshly-prepared salsas and an assortment of side orders.
Safe Harbor Statement
This news release contains forward-looking statements, which are statements that do not relate solely to historical fact. They include, but are not limited to, any statement that may predict, forecast, indicate or imply future results, performance, achievements or events. They may contain words such as “believe,” “anticipate,” “expect,” “estimate,” “intend,” “project,” “plan,” “will,” “should,” “may,” “could” or words or phrases of similar meaning. The statements reflect management’s current expectations regarding future events. Risk factors that could cause actual results to differ materially from those expressed in the forward-looking statements include, but are not limited to, concerns about food-borne illnesses; negative publicity, whether or not valid; adverse public perception due to the occurrence of avian flu; increases in the cost of chicken; an ultimate adverse ruling in litigation involving El Pollo Loco-Mexico which could result in the imposition of significant monetary damages and loss of rights to the trademarks in Mexico; our dependence upon frequent deliveries of food and other supplies; our sensitivity to events and conditions in the greater Los Angeles area; our reliance in part on our franchisees; our vulnerability to changes in consumer preferences and economic conditions; our ability to compete successfully with other quick service and fast casual restaurants; and other risk factors listed from time to time in the Company’s reports filed with the Securities and Exchange Commission. Statements about the Company’s past performance are not necessarily indicative of its future results. The Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as the result of new information, future events or otherwise.