The sign outside El Arroyo gets plenty of looks each day, as it serves up a steady diet of humorous one-liners.
But now the Tex-Mex restaurant is getting some unwanted attention, with a court battle brewing over who actually owns the El Arroyo name.
In a filing in U.S. District Court in Austin, the daughter of the restaurant’s founder claims the entity that has served as El Arroyo’s operator, Cozumel Inc., used “fraudulent representations” in filings with the U.S. Trademark and Patent Office that date back more than two decades.
Those filings led to a trademark being issued for the El Arroyo name and logo – a trademark that Susan Ogden says her father, Robert Ogden, had already obtained in 1989.
Ellis Winstanley, who took over Cozumel Inc. in 2012, long after the trademark had already been obtained by Cozumel Inc., told the American-Statesman on Monday that he disputes the claims made in the suit and plans to file a formal response soon – perhaps this week. Cozumel Inc., he said, “absolutely” owns the El Arroyo brand.
“The unfortunate reality of our legal system is anyone can file whatever they want, whenever they want,” Winstanley said. “We’ve always been up front and above board. We’ll be fighting this vigorously.”
Susan Ogden claims in court documents that Cozumel Inc. has tried numerous times over the years to buy the El Arroyo trademark from her family while, at the same time, claiming it already owns the trademark.
“At no time did the Ogdens grant Cozumel any assignment, covenant or other rights or interest under the El Arroyo mark that did not require the Ogdens’ consent and authorization to use the mark,” the suit states. “The Ogdens never conveyed ownership to the El Arroyo name to Cozumel or any party outside the family.”
Susan Ogden says in her filing that the restaurant has fallen on hard times with Winstanley’s team at the helm.
“Cozumel Inc. has failed to live up to its lease obligations and is under eviction order, which it has appealed,” the suit says. “This has triggered Ms. Ogden to exercise her obligation to maintain the quality and goodwill associated with the El Arroyo mark. Cozumel’s clear intent to disregard Ms. Ogden’s ownership and take with it the valuable El Arroyo mark caused Ms. Ogden to file this suit.”
Winstanley denied that El Arroyo is struggling.
“That’s false,” he said. “We’ve seen, especially these past few years, the opposite – a real resurgence in popularity.”
Ogden is asking a federal judge to declare Cozumel Inc. obtained its trademark via fraud and to either void that trademark or transfer it to her.
She’s seeking to prevent Cozumel Inc. from using the El Arroyo name at any location other than the current restaurant, which is at 1624 W. Fifth St. on downtown Austin’s western edge. She also seeks court costs and attorneys’ fees.
A trial date has not been set.