Legal issues in retail: The pizza wars

December 26, 2012 By Charisma L. Miller, Esq. Brooklyn Daily Eagle

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A new Grimaldi’s pizza place, Juliana’s, now has the right to serve up cheesy slices just one block from another Grimaldi’s in DUMBO, a Queens judge has ruled.

Back in 1998, Frank Ciolli purchased the Grimaldi’s name from the original owner Patsy Grimaldi for $500,000. Over a decade later, Patsy Grimaldi decided to come out of retirement and open a new pizzeria, Juliana’s. Ciolli, who was forced to relocate the original Grimaldi’s shop due to a rent dispute, filed an injunction against Patsy Grimaldi in hopes of preventing him from opening the new pizzeria and competing with the Grimaldi’s name and brand.

When Ciolli purchased the rights to the Grimaldi name in 1998, he required Patsy Grimaldi to sign a non-compete clause agreeing not to open up a pizzeria or similar establishment within a 3-mile radius of Grimaldi’s that would compete with Ciolli’s business. That non-compete agreement expired in 2009.

Ciolli asserted in his lawsuit that if Patsy Grimaldi were to open a new pizzeria, it “would recapture the many customers who have been longtime clientele of” his Grimaldi’s pizzeria, because of “confusion’’ over the name.

Queens County Supreme Court Justice Augustus Agate disagreed. “There is no proof that [Patsy Grimaldi] took any…steps to actively solicit any of [Ciolli’s] customers,” Hon. Agate noted in his decision. Instead, Agate ruled that Juliana’s provided Ciolli’s Grimaldi’s with “healthy competition.”

Ciolli views the Agate ruling as a mere setback: He has filed a new lawsuit against Patsy Grimaldi for allegedly installing an illegal coal oven in Juliana’s.

Juliana’s, located at 19 Old Fulton St. in DUMBO, is open for business. Grimaldi’s is open one block away at 1 Front St.