‘Trademark bully’: Momofuku turns up heat on others selling ‘chili crunch’

Across the US, a crunchy, crispy chili oil is being drizzled over dumplings, noodles, eggs, pizza – even ice cream. Once an almost secret sauce, this deep red condiment made with bits of dry chilis, crispy fried garlic, and often with sesame seeds and Sichuan pepper, has its roots in China. Now dozens of brands produce versions as this umami bomb goes mainstream.

But all is not well in the condiments aisle. Momofuku, the food empire founded by celebrity chef David Chang, is attempting to seize control of the market – or at least the name. The company has sent cease-and-desist letters to companies using the term “chili crunch” and “chile crunch” on their condiment labels and is trying to trademark “chili crunch” with the US Patent and Trademark Office (USPTO).

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Michelle Tew, founder of the Malaysian food brand Homiah, based in New York City, is one of the letter recipients. It states that Momofuku is the “ … owner of all trademark rights … ” for “chile crunch” and “chili crunch” (two different spellings) and that her product, Homiah Sambal Chili Crunch, is a trademark infringement.

Tew said her chili crunch is based on her Malaysian family’s recipe, where she grew up. Momofuku is concerned that consumers might confuse a jar of Homiah Sambal Chili Crunch, which has a colorful floral motif paper label, with a jar of Momofuku Chili Crunch, which is minimalist with a hand-drawn font and no paper label. Homiah has 90 days to cease the use of the “chili crunch trademark”.

Each brand has its own recipe of the chili condiment, often calling it chili oil, chili crisp, chili crunch, chili sauce, or a combination thereof; product labels reflect the shared vernacular. But Momofuku is specifically targeting those using the terms “chile crunch” and “chili crunch”.

Two of the biggest brands, Fly By Jing Sichuan Chili Crisp, launched by entrepreneur and chef Jing Gao in 2018, and China’s condiment queen, Lao Gan Ma Spicy Chili Crisp, are not in Momofuku’s crosshairs because they use “chili crisp”, not “chili crunch”. But those who chose “crunch” over “crisp” or “oil” for their product, are incensed.

As word spread of Momofuku’s cease-and-desist letters among food entrepreneurs making the chili condiment, reactions ranged from fear and annoyance, to disappointment and astonishment at the gall.

The company did not return requests for comment.

Tew described receiving the letter as “a punch in the gut”. Momfuku’s Chang, who is of Korean descent, has helped to push Asian food forward into the mainstream, she said. “If Kraft Heinz hit me up [with a cease-and-desist] it would have been so distressing,” says Tew, “but the fact that it was Momofuku makes me feel really, really sad.”

Seattle-based MìLà specializes in soup dumplings and also received a Momofuku cease-and-desist letter. Caleb Wang, who grew up between Chicago and Shanghai, recently revamped MìLà’s line of sauces with his co-owner and wife, Jen Liao. Since they added a larger portion of crispy, crunchy fried garlic to their previous recipe, giving an extra crunch, they named it MìLà Chili Crunch. It’s packaged in a futuristic bottle styled on the curvy calabash gourd, sometimes called húlu. “Our intent was to describe the product,” says Wang, noting that “chili crunch” gives their customers a better understanding of the new condiment than “chili crisp”.

Momofuku currently does not have the registered trademark for “chili crunch”, but began the filing process with the USPTO on 29 March, which can often take a year. To receive approval, it will have to prove that “chili crunch” is not merely a description of the product inside the jar, but rather that “chili crunch” has “distinctiveness through extensive use in commerce over many years”, as described on the USPTO website.

Momofuku does own the trademark rights to “chile crunch”, registered with the USPTO. Momofuku acquired “chile crunch” in 2023 from the Denver company Chile Colonial, LLC as part of a legal settlement. Chile Colonial had taken legal action against Momofuku for “trademark infringement, unfair competition”, according to court documents. Chile Crunch is the brand name of a chili condiment made by Chile Colonial, which has been on the market for more than a decade. It’s a Mexican version of chili crisp, typically called “salsa macha” – “chile” is “chili” in Spanish. Momofuku licenses the trademark to a “third party”, according to its cease-and-desist letter.

Momofuku’s cease-and-desist letter states Momofuku has been “offering” its chili crunch product since 2018, and jars of the chili crunch went on sale in 2020. The letter also states that the chili crunch has “developed valuable common law rights” to its “chili crunch” trademark. “Common law rights” is trademark law lingo for a term, or name, not registered with the USPTO, but that has become distinctive and famous over time. The proof Momofuku gives for its “chili crunch” distinctiveness and fame, thus its common law rights, is quantified by the product’s popularity, media coverage, Amazon reviews and its average 4.7 star reviews on its own website.

“The phrase that I would use to refer to Momofuku in this case, is a trademark bully,” says Stephen Coates, the lawyer representing Homiah. “This is a clear case of them picking on small businesses with a letter campaign hoping they’ll cave because of the financial pressure.” If small businesses capitulate and omit “chili crunch” from their labels, Momofuku’s product will appear more distinct as it applies for the registered “chili crunch” trademark.

Momofuku Goods, the consumer goods arm of Momofuku, has the resources for a trademark campaign, which can be expensive. It raised $17.5m in a Series A funding round led by Siddhi Capital in March 2023 and an $11.5m funding round led by Alliance Consumer Growth in September of the same year. In 2023, it made $50m in sales, according to CEO Marguerite Zabar Mariscal. Many of the companies Momofuku is targeting with cease-and-desist letters are one-, two-, three-person operations; some have raised VC or private equity investment, but others are bootstrapping, most with a revenue under $1m.

Several companies that received Momofuku’s cease-and-desist letter have acquiesced to Momofuku’s demands, or intend to, fearing the expense and hassle of a legal battle. Most of these companies did not want to talk to the Guardian on the record about their trademark experience with Momofuku, for fear of retaliation, retribution, or ill will from such a powerful, well-funded food company.

The purpose of trademark law is to protect consumers from being duped by counterfeit products and to protect business owners from being impersonated. Many entrepreneurs who make a chili condiment feel the motivation behind Momofuku’s trademark campaign is to stifle competition.

“It feels like it’s not done with good intent,” says Wang of MìLà about Momofuku’s aggressive cease-and-desist letter campaign, “like potentially boxing out smaller competitors and trying to own a space that’s tough to own.” Tew concurs and says that if Momofuku really just wanted to protect its brand, they could likely trademark “Momofuku Chili Crunch” v “chili crunch”.

Fly By Jing’s Gao is an advisor to Tew and investor in Homiah. Born in Chengdu, Sichuan, Gao says that chili condiments have existed in China for a very long time, and each family, restaurant, company and region has their own recipe and nomenclature. Translating these various chili condiment types into English word-for-word for the US consumer can be clunky, like “fragrant, spicy and crisp”, for example, likely to leave a US consumer puzzled. Labels need to be able to describe chili condiments for mainstream consumers, she said.

Gao was surprised to hear about Momofuku’s cease-and-desist letter campaign and filing for trademark on multiple levels. Gao tried to register “Sichuan chili crisp” as a trademark with the USPTO as it was the first chili crisp in the US sourcing exclusively from Sichuan. It was rejected on the basis of the words being descriptive. Gao is also disappointed by these recent developments, recalling it wasn’t that long ago she was told by investors and retailers that her business was too “niche”. She said she had a “rising tide lifts all boats” attitude toward fellow AAPI food entrepreneurs, as more brands validate the market. “The more people that are coming into the space,” says Gao, “is only going to be better for all of us.”