Atari Interactive, Inc. v. Nestlé, SA

No. 3:17-CV-04803-SK (N.D. Cal. Aug. 17, 2017)

On August 17, 2017, Atari Interactive sued Nestlé, alleging that a Nestlé KIT KAT® advertisement titled “Kit Kat: Breakout” infringed Atari’s rights relating to the video game BreakoutSpecifically, Atari has sued Nestlé for trademark and copyright infringement, false designation of origin, dilution, and both state and common law unfair competition.

Like many early Atari games, Breakout has a storied history.  Atari founder Nolan Bushnell originally conceptualized Breakout.  As noted by Atari’s Complaint, Steve Jobs and (“[i]n reality”) Steve Wozniak reduced Breakout from 100-175 chips down to 20-30 chips, allowing Breakout to be produced much more cheaply.  Some of the reward money earned by Jobs and Wozniak by improving Breakout was used to form Apple, and many of Wozniak’s innovations from the Breakout circuit board were used in developing the Apple II personal computer.

Nestlé’s “Kit Kat: Breakout” advertisement depicts four adults on a couch holding video game controllers and playing what appears to be a Breakout-style video game on a television in a train station:

Per its complaint, Atari appears particularly worried that Nestlé’s association with various scandals may be falsely imputed to Atari.  This is particularly the case because Atari heavily relies on its brand recognition to expand into new markets.  For example, most recently, Atari has been heavily promoting both a new throwback console as well as Atari-branded “speakerhats” (which are exactly what the name suggests).

Ed. - I checked and it's too late to get into the speakerhats beta.

Thanks to Kirk Sigmon for preparing this post
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