1 

UNITED STATES DISTRICT COURT 

WESTERN DISTRICT OF TEXAS 

SAN ANTONIO DIVISION 

NESTLE USA, INC., 

 Plaintiff, 

vs. 

ULTRA DISTRIBUCIONES 

MUNDIALES S.A. DE C.V. AND 

ULTRA INTERNATIONAL 

DISTRIBUTORS, INC., 

 Defendants.

Civil Action No.: 5:20-cv-000384 

COMPLAINT FOR: 

(1) TRADEMARK INFRINGEMENT, 

15 U.S.C. § 1114(1) 

(2) FALSE DESIGNATION OF ORIGIN AND 

UNFAIR COMPETITION, 

15 U.S.C. § 1125(a) 

(3) TRADEMARK DILUTION, 

15 U.S.C. § 1125(c) 

(4) UNLAWFUL IMPORTATION OF GOODS 

INFRINGING U.S. TRADEMARKS OR 

NAMES, 15 U.S.C. § 1124 AND 19 U.S.C. 

§ 1526 

(5) TRADEMARK DILUTION, TEX. BUS. & 

COM. CODE ANN. § 16.103 

(6) UNFAIR COMPETITION BY 

MISAPPROPRIATION 

(7) TORTIOUS INTERFERENCE WITH 

EXISTING AND PROSPECTIVE 

BUSINESS RELATIONS 

JURY TRIAL REQUESTED 

COMPLAINT 

Plaintiff Nestlé USA, Inc., by its attorneys, brings this complaint against defendants Ultra 

Distribuciones Mundiales, S.A. de C.V. (“Ultra Mundiales”) and Ultra International Distributors, 

Inc. (“Ultra International”, together with Ultra Mundiales, “Ultra”) as follows: 

NATURE OF ACTION 

1. This action arises from Ultra’s unauthorized importation, distribution and sale of 

Nestlé food and beverage products in the United States that were intended for sale only in Mexico. 

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2. Plaintiff Nestlé USA, Inc. (“NUSA” or “Plaintiff”) sells Nestlé food and beverage 

products throughout the United States. NUSA’s corporate affiliate, Société des Produits Nestlé 

S.A. (“SPN”), is the owner of Nestlé’s trademarks in the United States, and NUSA is the exclusive 

licensee of those trademarks and all of their associated rights. Accordingly, NUSA is responsible 

for the marketing, labelling, and distribution of Nestlé products in the United States. 

3. NUSA takes that responsibility seriously by ensuring that the contents, packaging, 

and labelling of Nestlé products sold in the United States comply with U.S. laws and regulations; 

by subjecting its products to rigorous quality control standards; and by providing high-quality postsale services to its customers. These activities have ensured continued goodwill for Nestlé 

trademarks in the United States, which in turn allows NUSA to profit from the sale of Nestlé 

products to U.S. consumers. Ultra is a consummate “free rider,” unfairly profiting off of the value 

of Nestlé’s trademarks and the investment that NUSA and its authorized distributors have made in 

creating consumer demand for Nestlé products. 

4. Ultra Mundiales is a Mexico-based global distributor of Mexican products, 

including products manufactured by Nestlé Mexico that are intended for sale only in Mexico. Ultra 

International is a Texas-based subsidiary of Ultra Mundiales that imports and sells Mexican 

products in the United States, including Nestlé Mexico products that it obtains from its parent 

company Ultra Mundiales. Ultra Mundiales ships Nestlé Mexico products by truck through 

Tijuana, Mexico to Ultra International for distribution in the United States. However, Ultra is not 

an owner or licensee of Nestlé trademarks in the United States, and NUSA has not authorized Ultra 

to sell Nestlé-trademarked products. Trademarked products in a market that are imported and sold 

in this manner without consent of the trademark owner are often referred to as “parallel imports” 

or “grey market goods.” 

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5. NUSA often sells its own version of the Nestlé Mexico products using the same 

Nestlé trademarks. Despite being sold under the same brands, using the same Nestlé trademarks, 

and having similar appearances, the Nestlé Mexico products sold by Ultra are materially different 

from their corresponding NUSA Products. While these differences may not matter to Ultra, they 

can have serious repercussions for NUSA, retailers, and consumers. 

6. Customers and consumers purchase the grey market products sold by Ultra without 

realizing that they are not authorized by NUSA for resale in the United States, are not properly 

labeled in compliance with the Food, Drug, and Cosmetic Act and the Food & Drug 

Administration’s (“FDA”) regulations and guidance, may contain formulations not intended for 

the United States market, and/or are not subject to NUSA’s rigorous quality control standards for 

post-sale services. As a result of Ultra’s actions and the resulting consumer confusion, NUSA and 

its authorized distributors in the United States have lost retail customers. Ultra’s actions have 

harmed NUSA, its business partners, and its customers. 

7. Accordingly, NUSA brings this action to recover damages due to Ultra’s unlawful 

distribution and sale of contraband food and beverage products, and to prevent Ultra’s further 

distribution and sale of such products. NUSA seeks this relief through claims under the federal 

Lanham Act and Tariff Act, claims under Texas’ Business and Commerce Code, and claims for 

unfair competition by misappropriation and tortious interference with existing and prospective 

business relationships with legitimate distributors under Texas common law. 

THE PARTIES, JURISDICTION, AND VENUE 

8. Plaintiff NUSA is a corporation organized and existing under the laws of the State 

of Delaware, with its principal place of business located at 1812 N. Moore Street in Arlington, 

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Virginia. NUSA is the exclusive licensee for Nestlé products in the United States, where it is 

responsible for the marketing and distribution of those products. 

9. Defendant Ultra Mundiales is a corporation organized and existing under the laws 

of Mexico, with its principal place of business located at Av. Hidalgo No. 1312 Pte. Centro, 

Torreón, Coahuila 27000. Ultra Mundiales describes itself as a worldwide supplier of Mexican 

products, including Nestlé grey market goods that it imports and distributes in the United States 

through its subsidiary Ultra International and other U.S. distributors. 

10. This Court has personal jurisdiction over Ultra Mundiales because Ultra Mundiales 

regularly transacts business in this judicial district, and because a substantial portion of the acts 

and omissions by Ultra International giving rise to NUSA’s claims and the damages and injuries 

complained of occurred in this judicial district. Ultra Mundiales imports the accused goods to this 

jurisdiction, where they are resold to distributors including its subsidiary Ultra International, which 

is induced to engage in illegal conduct by further distributing Nestlé grey market goods. 

11. Defendant Ultra International is a corporation organized and existing under the laws 

of the State of Texas, with its principal place of business located at 10205 Oasis Drive, Suite 320 

in San Antonio, Texas. Ultra International is a subsidiary of Ultra Mundiales, and a U.S. 

distributor of Mexican products, including Nestlé grey market goods obtained from its parent Ultra 

Mundiales and elsewhere. 

12. This Court has personal jurisdiction over Ultra International because Ultra 

International’s principal place of business is located in this judicial district, it regularly transacts 

business in this judicial district, and because a substantial portion of the acts and omissions by 

Ultra International giving rise to NUSA’s claims and the damages and injuries complained of 

occurred in this judicial district. 

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13. This Court has subject matter jurisdiction over this action under 15 U.S.C. § 1121 

and general principles of ancillary and pendent jurisdiction, as well as under 28 U.S.C. § 1332, as

the parties are citizens of different states and the amount in controversy exceeds $75,000. 

14. Venue is appropriate in this District pursuant to 28 U.S.C. §§ 1391(b) and (c). 

FACTUAL ALLEGATIONS 

NUSA and NUSA Products 

15. As a major multinational company—indeed, the largest food and beverage

company in the world—Nestlé has operating subsidiaries in many different countries. In North 

America, those operating subsidiaries include (among others) NUSA and Nestlé México, S.A. de 

C.V. (“Nestlé Mexico”). NUSA and Nestlé Mexico are responsible for the marketing, distribution, 

and sale of Nestlé products in the United States and Mexico, respectively. NUSA sells hundreds 

of Nestlé food and beverage products (the “NUSA Products”) in the United States. 

16. NUSA devotes a substantial amount of effort and resources to ensure that NUSA 

Products are based on the preferences of United States consumers, are safe to consumers, and 

comply with U.S. laws and regulations. Before the NUSA Products’ distribution and sale, NUSA 

ensures that the NUSA Products are properly manufactured, packaged, and labeled to their 

intended specifications/formulations, and NUSA conducts quality control checks of the NUSA 

Products. After the NUSA Products are distributed, NUSA continues to monitor the market by 

receiving consumer inquiries, tracking and investigating complaints, addressing spoilage issues, 

and performing necessary actions in response to such issues, including by conducting recalls or 

initiating legal proceedings. 

17. NUSA’s sale of the NUSA Products in the United States has been tremendously 

successful because of its efforts to ensure the high quality of those NUSA Products, as well as its 

substantial investment in the marketing and promotion of the NUSA Products. 

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Trademarks for the NUSA Products 

18. Each of the NUSA Products is marketed under a brand name that is subject to a 

trademark registered at the U.S. Patent and Trademark Office (“USPTO”). The owner of each 

trademark is SPN, which has entered into an agreement with NUSA granting NUSA an exclusive 

license to the rights associated with each trademark in the United States, including the right to 

enforce the trademark in the United States. 

19. The trademarks owned by SPN and registered with the USPTO (the “Nestlé 

Marks”) that are relevant here include: 

(a) Nestlé. Since at least 1878, NUSA or its predecessor in interest has 

continuously used the trademark “Nestlé” on a variety of NUSA Products. The “Nestlé” 

mark has been registered at the USPTO under various registration numbers, including 

0188089, 0380007, 1105743, 1521476, 1534496, 1622720, 2089943, 2081154, 2121177, 

2221586, 3343565, 3716317, 3598791, 4962410, and 4855611. 

(b) Nescafé. Since at least 1939, NUSA or its predecessor in interest has 

continuously used the trademark “Nescafé” on a variety of NUSA Products. The 

“Nescafé” mark has been registered at the USPTO under various registration numbers, 

including 0379117, 0843369, 1152592, 2951916, and 4879308. 

(c) Nido. Since at least 1941, NUSA or its predecessor in interest has 

continuously used the trademark “Nido” on a variety of NUSA Products. The “Nido” mark 

has been registered at the USPTO under various registration numbers, including 0394221 

and 4826708. 

(d) Good Food, Good Life. Since at least 2011, NUSA or its predecessor in 

interest has continuously used the trademark “Good Food, Good Life” on a variety of 

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NUSA Products. The “Good Food, Good Life” mark has been registered at the USPTO 

under various registration numbers, including 4270568 and 4270564. 

(e) Abuelita. Since at least 1998, NUSA or its predecessor in interest has 

continuously used the trademark “Abuelita” on a variety of NUSA Products. The 

“Abuelita” mark has been registered at the USPTO under various registration numbers, 

including 4969102 and 4111185. 

(f) Carnation. Since at least 1899, NUSA or its predecessor in interest has 

continuously used the trademark “Carnation” on a variety of NUSA Products. The 

“Carnation” mark has been registered at the USPTO under various registration numbers, 

including 0054383, 0112252, 0113006, 0319935, 0184498, 0183986, 0889131, and 

1086567. 

(g) La Lechera. Since at least 1988, NUSA or its predecessor in interest has 

continuously used the trademark “La Lechera” on a variety of NUSA Products. The “La 

Lechera” mark has been registered at the USPTO under various registration numbers, 

including 1557025, 4314364, and 5186726. 

20. The Nestlé Marks are famous, and the goodwill associated with them are of 

enormous value to NUSA, and are associated with high-quality food and beverage NUSA 

Products. Nescafé, for example, is ranked thirty-sixth and Nestlé is ranked fifty-ninth on 

Interbrand’s 2017 list of Best Global Brands.1 Similarly, according to Brand Finance’s Global 

500 2017 report, the Nestlé brand ranked as the sixty-first most valuable brand globally, with a 

 

1

 Interbrand, “Best Global Brands 2017 Rankings,” available at http://interbrand.com/bestbrands/best-global-brands/2017/ranking/. “Interbrand is a global brand consultancy, and 

publisher of the highly influential annual Best Global Brands.” See Interbrand, “About,” 

available at: http://interbrand.com/about/. 

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brand value of more than $19 billion.2 The Nestlé Marks became famous long before Ultra 

commenced its illegal and infringing activities that NUSA complains of herein. 

Ultra’s Wrongful Distribution and Sale of Nestlé Mexico Products in the United States 

21. Ultra describes itself as being a “100% Mexican owned company” that is 

“committed to serve World Wide customers that are continuously looking to acquire Mexican 

products.”3

22. Among the food and beverages that Ultra sells are products manufactured by Nestlé 

Mexico. 

23. Neither NUSA nor SPN have authorized Ultra to distribute or sell Nestlé products 

in the United States. NUSA and SPN also have not authorized Ultra to use the Nestlé Marks in 

the United States in any manner. 

24. Nevertheless, Ultra is in the business of acquiring products manufactured by Nestlé 

Mexico (the “Nestlé Mexico Products”) and distributing and selling them to retailers and other 

customers in the United States. 

25. The Nestlé Mexico Products that Ultra sells include, among others: 

• Nescafé coffee products, such as Nescafé Clásico and Nescafé Estilo Café de Olla; 

• Nido powdered drink formulas, including Nido Kinder 1-3 ãnos; 

• Chocolate drink products, such as Nestlé Abuelita; and 

• Milk and cream products, such as Nestlé Carnation Clavel, Nestlé La Lechera La 

Original, and Nestlé Media Crema. 

 

2

 Brand Finance, “Global 500 2017,” February 2017, available at 

http://brandfinance.com/images/upload/global_500_2017_locked_website.pdf.

3

See ultradm.com.mx/en/.

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26. Ultra regularly markets and provides customers in the United States with 

advertisements that use the Nestlé Marks to advertise Nestlé Mexico Products. For example, in an 

advertisement (attached in Exhibit A) for the ASD Market Week tradeshow previously scheduled 

to take place in Las Vegas, Nevada, between March 22-25, 2020, Ultra advertises grey market 

Nescafé Clasico, as is readily apparent from the Spanish language and metric weight on the front 

of the label. The advertisement uses the Nestlé Mark “Nescafé” with its accompanying images. 

The advertisement further indicates that grey market Nescafé Clasico would be offered for sale by 

Ultra at the ASD Market Week tradeshow. 

27. The Nestlé Mexico Products distributed by Ultra in the United States, as explained 

further below, are materially different from the corresponding NUSA Products marketed under the 

same brand. For instance, they use Spanish-only labels with nutritional information and metric 

units that are inconsistent with FDA regulations; they have in some instances different 

formulations that are also inconsistent with FDA regulations; and they are subject to different 

quality control standards and post-sale services. 

Material Differences Between NUSA Products and Nestlé Mexico Products Sold by Ultra 

28. For each of the Nestlé Mexico Products sold by Ultra, there is a similar but 

materially different NUSA Product that is actually intended for sale in the United States. The 

Nestlé Mexico Products sold by Ultra use many of the same Nestlé Marks that appear on these 

NUSA Products. For example: 

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NUSA Product Nestlé Mexico Product 

Nescafé Clásico Nescafé Clásico 

Nido Kinder 1+ Nestlé Kinder 1-3 años 

Nestlé Abuelita Nestlé Abuelita 

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NUSA Product Nestlé Mexico Product 

Nestlé Carnation Nestlé Carnation Clavel 

Nestlé La Lechera Condensed Milk Nestlé La Lechera La Original 

Nestlé Media Crema Table Cream Nestlé Media Crema 

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29. Despite their use of the same Nestlé Marks and similarities in appearance, there are 

material differences between the NUSA Products and the Nestlé Mexico Products concerning, 

among other things, the information contained on the labels, product composition/formulation, and 

post-sale services for the products. 

Labels 

30. The Nestlé Mexico Products sold by Ultra are labeled in Spanish while the NUSA 

Products are labeled in English. For example: 

NUSA Product Nestlé Mexico Product 

Nestlé Abuelita Nestlé Abuelita 

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NUSA Product Nestlé Mexico Product 

Nestlé Carnation Nestlé Carnation Clavel 

Nestlé La Lechera Condensed Milk Nestlé La Lechera La Original 

31. This Spanish-language-only labelling of the Nestlé Mexico Products is a violation 

of FDA regulations that require products sold in the United States to be labeled in English and 

allow labeling in a foreign language such as Spanish only when all required label elements are 

provided in both English and Spanish. See 21 CFR 101.15(c)(2). 

32. Many of the labels for the Nestlé Mexico Products refer to a website affiliated with 

Nestlé Mexico, recetasnestle.com.mx, whereas the corresponding labels for the NUSA Products 

refer to websites affiliated with NUSA, such as cocinandoconnestle.com and lalechera.com. 

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Likewise, many of the labels for the Nestlé Mexico Products provide a customer service line 

affiliated with Nestlé Mexico, whereas the corresponding labels for the NUSA Products provide a 

customer service line affiliated with NUSA. For example: 

NUSA Product Nestlé Mexico Product 

Nestlé La Lechera Condensed Milk Nestlé La Lechera La Original 

Nestlé Media Crema Table Cream Nestlé Media Crema 

The websites and customer service line identified on labels of the Nestlé Mexico Products will 

not allow U.S. consumers to contact the firm responsible for the Products in the event of a safety 

or quality concern. 

33. The Nutrition Facts Panel on the label for the NUSA Products complies with FDA 

regulations, which specify certain formatting for font sizes, bolding, spacing, and lines between 

text, as well as naming and order of nutrients listed. See 21 CFR 101.9(c), (d). The NUSA Products 

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also comply with FDA regulations by providing serving sizes in appropriate units. See 21 CFR 

101.9(b). Further, consistent with new FDA nutrition labeling regulations that went into effect on 

January 1, 2020, the NUSA Products’ labels identify the added sugar content of the products and 

list calories in a designated larger font. 

34. However, the nutrition labels for the Nestlé Mexico Products are different in 

appearance and content from the Nutrition Facts Panels on the labels for the NUSA Products. 

Many of the Nestlé Mexico Products’ nutritional information lacks the font sizes, bolding, spacing, 

lines between texts, and naming and order of nutrients mandated by FDA regulations, and/or do 

not provide serving sizes in the units required by FDA regulations. Further, none of the Nestlé 

Mexico Products identify their added sugar content or list calories in a designated larger font. In 

addition, many of the Nestlé Mexico Products provide different nutritional information than the 

NUSA Products because they may have different formulations and/or recommended serving sizes. 

NUSA Product Nestlé Mexico Product 

Nestlé La Lechera Condensed Milk Nestlé La Lechera La Original 

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NUSA Product Nestlé Mexico Product 

Nestlé Abuelita Nestlé Abuelita 

35. The labels for the NUSA Products identify the quantity of the NUSA Products in 

both U.S. Customary and metric units as required by FDA regulations. In contrast, the labels for 

the Nestlé Mexico Products sold by Ultra use only metric units. For example: 

NUSA Product Nestlé Mexico Product 

Nestlé La Lechera Condensed Milk Nestlé La Lechera La Original 

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NUSA Product Nestlé Mexico Product 

Nestlé Carnation Nestlé Carnation Clavel 

Product Composition and Formulation

36. The product compositions and formulations of the NUSA Products and Nestlé 

Mexico Products may also differ. For example, the NUSA and Nestlé Mexico versions of La 

Lechera have different fat and sugar content: 

Content Per Serving 

NUSA Nestlé Mexico 

Fat Content 3.5g 2g 

Sugar Content 22g 23.6g 

37. Likewise, the NUSA and Nestlé Mexico versions of Nestlé Media Crema have 

different fat and sugar content: 

Content Per Serving 

NUSA Nestlé Mexico 

Fat content 4g 3g 

Sugar content 0g .6g 

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Other Material Differences

38. Beyond differences in their labelling and formulations, there are a number of 

additional material differences between the NUSA Products and the Nestlé Mexico Products. 

39. For example, before NUSA Products are distributed and sold in the United States, 

they are subject to food safety and quality assurance processes to ensure they meet the 

requirements of U.S. laws and regulations. Products that Nestlé Mexico manufactures for 

distribution in Mexico must conform to Mexico’s food safety and quality standards. In addition, 

in the event of a quality issue or a product recall involving these Mexican manufactured products, 

it may be difficult to trace the products and their ingredients to determine the source of the issue. 

40. NUSA also offers a number of post-sale services for the NUSA Products, including 

returns, spoils allowances, “scan-backs,” customer service, and in-store demonstrations. These 

services result in a different experience for retailers and consumers of NUSA Products compared 

to retailers and consumers of grey market Nestlé Mexico Products distributed by Ultra: 

(a) Returns: NUSA allows returns of certain NUSA Products if retailers and/or 

customers are dissatisfied with those NUSA Products. However, because NUSA never 

distributed the Nestlé Mexico Products diverted by Ultra, retailers and customers who 

purchased those products will not be able to return them to NUSA, potentially damaging 

the customer perception of NUSA and the Nestlé Marks. 

(b) Spoils Allowances and “Scan-Backs”: NUSA provides certain credits to 

retailers for NUSA Products that have been spoiled or damaged, and for NUSA Products 

that have been sold at a discounted price. These credits help prevent retailers from losing 

money on products that are damaged or spoiled, or that remain unsold. They also 

encourage retailers to remove spoiled and/or damaged products from their shelves, and to 

offer lower prices for NUSA Products. However, NUSA cannot provide credits for Nestlé 

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Mexico Products because NUSA did not provide those Nestlé Mexico Products to retailers 

in the first instance. 

(c) Customer Service: Retailers and consumers who have purchased NUSA 

Products may contact NUSA’s customer service staff in the United States to address any 

concerns that they have about their NUSA Products, and NUSA’s customer service staff 

can address those concerns. However, NUSA’s customer service staff cannot address 

concerns that retailers and consumers raise about Nestlé Mexico Products that they have 

purchased, as NUSA had no involvement in the Nestlé Mexico Products’ manufacture, 

labelling, distribution, or sale. 

(d) In-Store Demonstrations: When a retailer sells NUSA Products, NUSA 

provides certain in-store demonstrations of the NUSA Products for retailers and 

consumers, thereby better informing them about how to properly use the NUSA Products 

and encouraging further sales at those locations. However, NUSA does not provide instore demonstrations for the Nestlé Mexico Products distributed by Ultra. This deprives 

consumers of information about their purchases and dampens consumer demand. 

41. By providing these post-sale services for the NUSA Products, NUSA builds 

goodwill for itself, the NUSA Products, and the Nestlé Marks in the United States. However, U.S. 

purchasers of Nestlé Mexico Products do not enjoy those services, thereby diminishing the 

goodwill of the Nestlé Marks. 

Ultra’s Use of Stickers on Certain Nestlé Mexico Products 

42. In some instances, Ultra has distributed and/or sold Nestlé Mexico Products that 

include unauthorized stickers on top of the original product labels. 

43. For example, the Nestlé Media Crema La Original products being sold through 

retailers for whom Ultra is a distributor include stickers on both the front and the back side of the 

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product. This is obvious when comparing the product being distributed through Ultra to an image 

of the original Nestlé Mexico Product: 

Original Appearance Appearance with Sticker 

Sticker Applied to Back of Nestlé Media Crema La Original

44. The stickers that appear on this product provide some nutritional and ingredients 

information intended to create the impression that retailers and/or consumers are purchasing a 

NUSA Product and/or that the Nestlé Mexico Product complies with U.S. labeling requirements 

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and other regulations. However, the stickers are insufficient to bring the Nestlé Mexico Product 

into compliance with U.S. regulations. For instance, the product’s net weight declaration does not 

appear on the principal display (front) panel of the product, as required by 21 CFR 101.107. 

45. As another example, Ultra has sold the Nestlé Mexico versions of Nescafé Clásico 

and Nestlé Carnation with stickers purporting to provide nutritional information that fail to meet 

FDA requirements. For instance, under 21 C.F.R. 101.15(c), any product that makes 

representations in Spanish must include all required labeling elements—including nutritional facts 

and ingredients information—both in English and in Spanish. This requirement ensures that, when 

a foreign language is used to attract non-English-speaking consumers, speakers of the foreign 

language are able to obtain all the information the FDA deems necessary to make educated food 

purchasing decisions. Ultra has violated this requirement by selling products with Englishlanguage-only nutrition labels covering the Spanish-language nutrition labels. 

46. The stickered Nescafé Clásico and Nestlé Carnation products sold by Ultra also fail 

to comply with the FDA’s regulations because their net weight declaration does not appear on the 

principal display (front) panel of the product, and their “Nutrition Facts” panels do not meet the 

necessary format and content requirements, such as appropriate hairline thickness or placement 

between lines of text (see 21 CFR 101.9(d)); font sizes, bolding, naming (e.g., kcal and lipids), and 

order of certain nutrients do not comply with FDA regulations (see 21 CFR 101.9(c)); and/or 

serving sizes that are not appropriately calculated in common household units (see 21 CFR 

101.9(b)). 

47. By selling products with stickers that fail to comply with the FDA’s labeling 

requirements, Ultra undermines the FDA’s efforts to ensure that consumers make informed food 

choices, to facilitate price comparisons, and to prevent fraud upon consumers. Ultra’s failure to 

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comply with federal regulations also undermines goodwill for NUSA, its products, and the Nestlé 

Marks throughout the United States. 

Effects of Ultra’s Wrongful Conduct on NUSA and Its Customers 

48. Retailers and consumers have purchased Nestlé Mexico Products distributed by 

Ultra under the mistaken belief that those products are NUSA Products, and/or that the distribution 

and sale of those products is associated with NUSA. As a result, those retailers and consumers 

have purchased materially different products from the ones they believed they were purchasing—

products that lack the required label statements, product formulation, quality control, food safety 

compliance, and post-sale services that they were expecting. This consumer confusion and 

resulting damage to NUSA and the goodwill associated with the Nestlé Marks is likely to continue 

if Ultra’s infringing activities are not stopped. This has harmed and continues to harm NUSA’s 

goodwill and reputation, and the goodwill associated with the Nestlé Marks in the United States, 

resulting in enormous harm and damages to NUSA. 

49. Further, by circumventing legitimate distribution channels and quality control 

procedures, and by failing to provide the services that NUSA and its legitimate distributors provide 

to retailers and customers, in many instances Ultra has been able to offer artificially low prices for 

the Nestlé Mexico Products. As a result, some retailers and consumers have purchased Nestlé 

Mexico Products imported by Ultra, rather than NUSA Products intended for distribution and sale 

in the United States, resulting in substantial losses to NUSA and its authorized distributors and 

disruptions to NUSA’s business relationships with its customers. This confusion among retailers 

and consumers and resulting damage to NUSA and the goodwill associated with the Nestlé Marks 

is likely to continue if Ultra’s infringing activities are not stopped. 

50. Ultra has engaged in this unlawful conduct despite knowing that it is infringing 

upon NUSA’s rights to the Nestlé Marks in the United States. 

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FIRST CAUSE OF ACTION 

Trademark Infringement, 15 U.S.C. § 1114(1) 

Against All Defendants 

51. NUSA incorporates and realleges each and every allegation set forth in paragraphs 

1 to 50 above as if fully set forth herein. 

52. NUSA is the exclusive licensee of all rights, title, and interest in and to the Nestlé 

Marks in the United States and has the exclusive right to use the Nestlé Marks in the United States 

in connection with the NUSA Products. 

53. In the United States, NUSA or its predecessors have used the Nestlé Marks 

continuously for decades—and in some cases, more than a century—to identify their goods and 

distinguish them from those made and sold by others by, among other things, prominently 

displaying the Nestlé Marks on the NUSA Products and their packaging and marketing materials. 

54. Defendants have infringed NUSA’s rights to the Nestlé Marks in interstate 

commerce by various acts, including advertising, distributing, and offering for sale goods bearing 

the Nestlé Marks which were manufactured solely for the Mexican market, and were not 

manufactured by NUSA for sale in the United States under the Nestlé Marks. 

55. Defendants’ acts of infringement are likely to cause, and have caused, confusion, 

mistake, and deception, in that purchasers and others in the United States are likely to believe 

NUSA authorizes and controls the sale of Defendants’ products, or that Defendants are associated 

with or related to NUSA or are authorized by NUSA to distribute or sell the NUSA Products in 

the United States. 

56. Defendants’ acts of infringement have been committed deliberately and willfully, 

with knowledge of NUSA’s exclusive rights and goodwill in the Nestlé Marks, and with 

knowledge of the infringing nature of the marks when used in connection with the diverted Nestlé 

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24 

Mexico Products. Defendants’ acts have also been committed with bad faith and the intent to 

cause confusion or mistake and/or to deceive. 

57. Defendants had actual and constructive knowledge of NUSA’s superior rights in 

and to the Nestlé Marks prior to Defendants’ adoption and use of the Nestlé Marks, and Defendants 

continue to use the Nestlé Marks with actual knowledge of infringing conduct. 

58. NUSA has not consented to Defendants’ use of the Nestlé Marks for any purpose, 

and NUSA has not consented to the sale of the Nestlé Mexico Products bearing the Nestlé Marks 

in the United States market. 

59. By reason of Defendants’ wrongful acts of infringement, NUSA has suffered injury 

and damage, in an amount to be proven at trial, by causing customer dissatisfaction, a diminution 

of the value of the goodwill associated with the Nestlé Marks in the United States, and a loss of 

sales and/or market share, among other reasons. 

60. Further, by reason of Defendants’ wrongful acts of infringement, NUSA has 

suffered and will continue to suffer substantial and irreparable injury, loss, and damage to its rights 

in and to the Nestlé Marks, and damage to the goodwill associated therewith, for which it has no 

adequate remedy at law. 

61. If not restrained, Defendants will have unfairly derived and will continue to derive 

income, profits, gain and business opportunities as a result of their acts of infringement. 

62. By reason of the foregoing, NUSA is entitled to injunctive relief pursuant to 15 

U.S.C. § 1116, for the infringing Nestlé Mexico Products to be destroyed pursuant to 15 U.S.C. 

§ 1118, as well as actual damages, treble damages, disgorgement of Defendants’ profits, the costs 

of this action, and attorneys’ fees pursuant to 15 U.S.C. § 1117, among other relief. 

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SECOND CAUSE OF ACTION 

False Designation of Origin and Unfair Competition, 15 U.S.C. § 1125(a) 

Against All Defendants 

63. NUSA incorporates and realleges each and every allegation set forth in paragraphs 

1 to 62 above as if fully set forth herein. 

64. NUSA is the exclusive licensee of all rights, title, and interest in and to the Nestlé 

Marks in the United States and has the exclusive right to use the Nestlé Marks in the United States 

in connection with the NUSA Products. 

65. Defendants have, without authorization, imported, distributed, and sold in the 

United States unauthorized or diverted products featuring the Nestlé Marks, which are products 

that are materially different from the NUSA Products authorized for U.S. sale by NUSA. 

66. Defendants’ acts of false designation of origin and unfair competition are likely to 

cause, and have caused, confusion, mistake, and deception as to the affiliation, connection, or 

association of Defendants with NUSA, and as to the origin, sponsorship, and/or approval of 

Defendants’ goods, in that purchasers and others in the United States are likely to believe NUSA 

authorizes and controls the sale of Defendants’ products, or that Defendants are associated with or 

related to NUSA or are authorized by NUSA to distribute or sell the NUSA Products in the United 

States. 

67. Defendants’ acts of false designation of origin and unfair competition have been 

committed deliberately and willfully, with knowledge of NUSA’s exclusive rights and goodwill 

in the Nestlé Marks, and with knowledge of the infringing nature of the marks when used in 

connection with the diverted Nestlé Mexico Products. Defendants’ acts have also been committed 

with bad faith and the intent to cause confusion or mistake and/or to deceive. 

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68. Defendants had actual and constructive knowledge of NUSA’s superior rights in 

and to the Nestlé Marks prior to Defendants’ adoption and use of the Nestlé Marks, and Defendants 

continue to use the Nestlé Marks with actual knowledge of infringing conduct. 

69. NUSA has not consented to Defendants’ use of the Nestlé Marks for any purpose, 

and NUSA has not consented to the sale of the Nestlé Mexico Products bearing the Nestlé Marks 

in the United States market. 

70. By reason of Defendants’ wrongful acts of unfair competition, NUSA has suffered 

injury and damage, in an amount to be proven at trial, by causing customer dissatisfaction, a 

diminution of the value of the goodwill associated with the Nestlé Marks in the United States, and 

a loss of sales and/or market share, among other reasons. 

71. Further, by reason of Defendants’ wrongful acts of unfair competition, NUSA has 

suffered and will continue to suffer substantial and irreparable injury, loss, and damage to its rights 

in and to the Nestlé Marks, and damage to the goodwill associated therewith, for which it has no 

adequate remedy at law. 

72. If not restrained, Defendants will have unfairly derived and will continue to unfairly 

derive income, profits, and business opportunities as a result of their acts of unfair competition. 

73. By reason of the foregoing, NUSA is entitled to injunctive relief pursuant to 15 

U.S.C. § 1116, for the infringing Nestlé Mexico Products to be destroyed pursuant to 15 U.S.C. 

§ 1118, and to actual damages, treble damages, disgorgement of Defendants’ profits, the costs of 

this action, and attorneys’ fees pursuant to 15 U.S.C. § 1117, among other relief. 

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THIRD CAUSE OF ACTION 

Trademark Dilution, 15 U.S.C. § 1125(c) 

Against All Defendants 

74. NUSA incorporates and realleges each and every allegation set forth in paragraphs 

1 to 73 above as if fully set forth herein. 

75. NUSA is the exclusive licensee of all rights, title, and interest in and to the Nestlé 

Marks in the United States and has the exclusive right to use the Nestlé Marks in the United States 

in connection with the NUSA Products. 

76. The Nestlé Marks are famous and distinctive within the meaning of 15 U.S.C. 

§ 1125(c). 

77. The Nestlé Marks are widely recognized by the general consuming public of the 

United States as a designation of source of NUSA’s goods, including the NUSA Products. 

78. The Nestlé Marks became famous source indicators for the NUSA Products long 

before Defendants commenced their infringing activities. 

79. Defendants’ acts have diluted the Nestlé Marks in the United States by blurring 

their association with the NUSA Products and reducing purchasers’ ability to identify and 

distinguish goods intended for different markets. In addition, Defendants’ distribution and sale of 

goods intended for the Mexican market (which may have different formulations, label information, 

and/or post-sale services than consumers expect) in the United States and Defendants’ placement 

of unauthorized stickers in a manner that defaces the Nestlé Marks and fails to comply with 

relevant regulations have diluted the Nestlé Marks by tarnishment. 

80. Defendants had actual and constructive knowledge of NUSA’s superior rights in 

and to the Nestlé Marks prior to Defendants’ adoption and use of the Nestlé Marks, and Defendants 

continue to use the Nestlé Marks with actual knowledge of infringing conduct. 

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81. NUSA has not consented to Defendants’ use of the Nestlé Marks for any purpose, 

and NUSA has not consented to the sale of the Nestlé Mexico Products bearing the Nestlé Marks 

in the United States market. 

82. Defendants’ acts have irreparably damaged NUSA and will continue to do so unless 

restrained by this Court. Therefore, NUSA is without an adequate remedy at law and is entitled 

to, among other relief, an order enjoining and restraining Defendants from diverting, distributing, 

and selling the Nestlé Mexico Products in the United States. 

FOURTH CAUSE OF ACTION 

Unlawful Importation of Goods Infringing U.S. Trademarks or Names, 

15 U.S.C. § 1124 and 19 U.S.C. § 1526 

Against All Defendants 

83. NUSA incorporates and realleges each and every allegation set forth in paragraphs 

1 to 82 above as if fully set forth herein. 

84. In the United States, NUSA is the exclusive licensee of the Nestlé Marks, which 

are registered with the USPTO. Defendants imported the Nestlé Mexico Products, which bear the 

Nestlé Marks, into the United States without the permission of NUSA. 

85. By reason of Defendants’ wrongful importing of the Nestlé Mexico Products that 

are materially different from products authorized for sale in the United States under the Nestlé 

Marks, NUSA has suffered and will continue to suffer substantial and irreparable injury, loss, and 

damage to its rights in and to the Nestlé Marks, and damage to the goodwill associated therewith, 

for which it has no adequate remedy at law. 

86. By reason of the foregoing, NUSA is entitled to, among other relief, an order 

enjoining and restraining Defendants from diverting, distributing, and selling the Nestlé Mexico 

Products in the United States, and/or seizure of the Nestlé Mexico Products and/or requiring the 

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Defendants to destroy the Nestlé Mexico Products in their possession, as well as actual damages, 

treble damages, disgorgement of Defendants’ profits, the costs of this action, and attorneys’ fees 

pursuant to 15 U.S.C. § 1117, among other relief. 

FIFTH CAUSE OF ACTION 

Trademark Dilution Tex. Bus. & Com. Code Ann. § 16.103 

Against All Defendants 

87. NUSA incorporates and realleges each and every allegation set forth in paragraphs 

1 to 86 above as if fully set forth herein. 

88. NUSA is the exclusive licensee of all rights, title, and interest in and to the Nestlé 

Marks in the United States and has the exclusive right to use the Nestlé Marks in the United States 

in connection with the NUSA Products. 

89. The Nestlé Marks are famous and distinctive within the meaning of Texas Business 

and Commerce Code § 16.103. 

90. The Nestlé Marks are widely recognized by the general consuming public of Texas 

as a designation of source of NUSA’s goods, including the NUSA Products. 

91. The Nestlé Marks became famous source indicators for the NUSA Products long 

before Defendants commenced their infringing activities. 

92. NUSA has not consented to Defendants’ use of the Nestlé Marks for any purpose, 

and NUSA has not consented to the sale of the Nestlé Mexico Products bearing the Nestlé Marks 

in the United States market. 

93. Defendants’ acts have diluted the Nestlé Marks in Texas and the United States by 

blurring their association with the NUSA Products and reducing purchasers’ ability to identify and 

distinguish goods intended for different markets. Defendants’ acts have further diluted the Nestlé 

Case 5:20-cv-00384-DAE Document 1 Filed 03/25/20 Page 29 of 34
30 

Marks in Texas and the United States by tarnishing them, given the material differences between 

the NUSA Products and the Nestlé Mexico Products. 

94. Defendants’ acts have irreparably damaged NUSA and will continue to do so unless 

restrained by this Court. Therefore, NUSA is without an adequate remedy at law and is entitled 

to, among other relief, an order enjoining and restraining Defendants from diverting, distributing, 

and selling the Nestlé Mexico Products. 

SIXTH CAUSE OF ACTION 

Unfair Competition by Misappropriation 

Against All Defendants 

95. NUSA incorporates and realleges each and every allegation set forth in paragraphs 

1 to 94 above as if fully set forth herein. 

96. NUSA has devoted a substantial amount of effort and resources to develop its 

products, ensure that NUSA Products are of the highest quality and based on the preferences of 

United States consumers, are safe to consumers, and comply with U.S. laws and regulations. 

97. Ultra is a “free rider,” unfairly profiting off of the value of Nestlé’s trademarks and 

the investment that NUSA and its authorized distributors have made in creating consumer demand 

for Nestlé products. 

98. Defendant has circumvented legitimate distribution channels and quality control 

procedures, and failed to provide the services that NUSA and its legitimate distributors provide to 

retailers and customers. As a result, Ultra has been able to offer artificially low prices for the Nestlé 

Mexico Products. 

99. Some retailers and consumers have therefore purchased Nestlé Mexico Products 

imported by Ultra, rather than NUSA Products intended for distribution and sale in the United 

States, resulting in substantial losses to NUSA and its authorized distributors 

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100. As a result of the Defendants’ wrongful conduct, NUSA is entitled to, among other 

relief, an order enjoining and restraining Defendants from diverting, distributing, and selling the 

Nestlé Mexico Products and restoring to NUSA funds that were wrongfully collected by 

Defendants. 

SEVENTH CAUSE OF ACTION 

Tortious Interference with Existing and Prospective Business Relations 

Against All Defendants 

101. NUSA incorporates and realleges each and every allegation set forth in paragraphs 

1 to 100 above as if fully set forth herein. 

102. NUSA had existing economic relationships with each of its existing and prospective 

customers. Each of those relationships benefited NUSA economically and likely would have 

continued to benefit NUSA economically in the future. 

103. The Defendants were aware of NUSA’s economic relationships with its existing 

and prospective customers by virtue of their direct contact with those existing and prospective 

customers, as well as their familiarity with the business of distributing and selling food and 

beverage products in the United States. 

104. The Defendants intentionally interfered with those economic relationships, and/or 

knew that the disruption of such relationships was certain or substantially certain to occur, when 

they wrongfully and unlawfully used the Nestlé Marks, and distributed and sold Nestlé Mexico 

Products in the United States without the permission of NUSA. NUSA’s relationships with its 

customers were disrupted, resulting in harm to NUSA, and Defendants’ conduct was a substantial 

factor in causing that harm. 

105. As a result of Defendants’ tortious interference with NUSA’s business relations, 

NUSA is entitled to, among other relief, damages in an amount to be determined at trial. 

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PRAYER FOR RELIEF 

WHEREFORE, Plaintiff NUSA prays for judgment against the Defendants as follows: 

(1) Preliminary and permanent injunctive relief against the Defendants and their 

officers, agents, servants, employees, affiliates, successors, assigns, and all persons 

acting in concert or participation with them, from doing any of the following acts, 

either directly or indirectly: 

(a) Acquiring, transporting, distributing, developing, offering to sell, or selling 

any products bearing the Nestlé Marks; 

(b) Using any of the Nestlé Marks or any other trademark owned by SPN and/or 

licensed to NUSA in connection with their business; 

(c) Otherwise infringing the Nestlé Marks or any other trademark owned by 

SPN and/or licensed to NUSA; 

(d) Causing likelihood of confusion, deception, or mistake as to the source, 

nature, or quality of the NUSA Products or any other products 

manufactured, distributed, or sold by NUSA and/or that bears the Nestlé 

Marks; 

(e) Using any false designation of origin or false representation concerning the 

NUSA Products or any other products manufactured, distributed, or sold by

NUSA and/or that bear the Nestlé Marks; and 

(f) Any acts of unfair competition or unfair practice affecting NUSA, the 

NUSA Products, or any other products manufactured, distributed, or sold 

by NUSA and/or that bear the Nestlé Marks; 

Case 5:20-cv-00384-DAE Document 1 Filed 03/25/20 Page 32 of 34
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(2) For an order directing the Defendants, and each of them, to file with this Court and 

serve on NUSA within 30 days after service of an injunction, a report in writing 

under oath, setting forth in detail the manner and form in which Defendants have 

complied with the injunction; 

(3) For an order to destroy the Nestlé Mexico Products or any other products bearing 

the Nestlé Marks in the possession of the Defendants and their officers, agents, 

servants, employees, affiliates, successors, assigns, and all persons acting in concert 

or participation with them; 

(4) For an order seizing the Nestlé Mexico Products or any other products bearing the 

Nestlé Marks in the possession of the Defendants and their officers, agents, 

servants, employees, affiliates, successors, assigns, and all persons acting in concert 

or participation with them; 

(5) For an accounting and disgorgement of all of Defendants’ profits resulting from its 

sale of the Nestlé Mexico Products and any other products bearing a Nestlé Mark 

in the United States; 

(6) For an order awarding NUSA damages in an amount to be determined, as well as 

treble damages, prejudgment and postjudgment interest on its damages award, 

punitive damages, and NUSA’s reasonable attorneys’ fees and costs of suit; 

(7) Such other and further relief as the Court may deem proper. 

 

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DEMAND FOR JURY TRIAL 

Plaintiff NUSA demands a trial by jury of all issues so triable. 

Dated: March 25, 2020 MAYER BROWN LLP 

By: /s/ Charles Kelley

Charles Kelley 

Texas Bar No. 11199580

MAYER BROWN LLP 

700 Louisiana Street, Suite 3400 

Houston, Texas 77002 

Telephone: (713) 238-2634 

Mobile (281) 300-5455 

Fax: (713) 238-4634 

Email: ckelley@mayerbrown.com 

Adam Hudes (Pro Hac Vice to be filed) 

District of Columbia Bar No. 495188

MAYER BROWN LLP 

1999 K Street, N.W. 

Washington, D.C. 20006 

Telephone: (202) 263-3000 

Fax: (202) 263-3300 

Email: ahudes@mayerbrown.com 

Dale Giali (Pro Hac Vice to be filed) 

California State Bar No. 150382 

MAYER BROWN LLP 

350 South Grand Avenue 

Los Angeles, California 90071 

Telephone: (213) 229-9500 

Fax: (213) 625-0248 

Email: dgiali@mayerbrown.com

Attorneys for Plaintiff Nestlé USA, Inc. 

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