Hard Rock Cafe Takes Its Rival to Court Over Motif
Rejecting the notion that imitation is the sincerest form of flattery, the West Coast owners of the Hard Rock Cafe chain filed a lawsuit in Los Angeles on Thursday against rival eatery Planet Hollywood.
The U.S. District Court case alleges that Planet Hollywood executives conspired to force Hard Rock Cafe to sell its assets below market value by creating “a chain of highly publicized entertainment/music themed restaurants . . . similar (to Hard Rock) but of substantially lower quality.”
Planet Hollywood, which has a movie memorabilia theme, opened its first branch in Manhattan last year. Its investors include Arnold Schwarzenegger, Sylvester Stallone and Bruce Willis, though they are not named in the suit.
The lead plaintiff in the Los Angeles case, which seeks more than $1 billion in damages, is Peter Morton, who holds the West Coast rights to the Hard Rock name. The defendants include Britain’s Rank Organization, a conglomerate that controls the Hard Rock Cafe name on the East Coast, and Robert Earl, a Planet Hollywood investor who is also the Rank executive in charge of managing its Hard Rock assets.
The suit maintains that Earl helped to establish Planet Hollywood in an effort to devalue Morton’s Hard Rock holdings. The suit also alleges that Earl used proprietary marketing, financial and operating strategies from the Hard Rock chain.
“Why is Rank management allowing Robert Earl, who is their CEO of Hard Rock, to open a chain of similar competing restaurants?” asked Bertram Fields, Morton’s attorney. “Why are they allowing Earl to take key executives from Hard Rock, and even kitchen personnel?”
Rank executives, including Earl, could not be reached for comment on the suit late Thursday.
The Hard Rock Cafe chain, known for its trendy patrons and rock ‘n’ roll motif, was started by Morton and Isaac Tigrett in 1971. The two parted ways in 1985, and Tigrett later sold his half of the chain to a company that was taken over by Rank.
This marks the second time the East and West Coast Hard Rock branches have feuded recently. Rank challenged Morton’s plans for building a $75-million Hard Rock hotel-casino in Las Vegas, but an arbitrator this week sided with Morton.
