Taco Bell Loses $30 Mil. Lawsuit

LOS ANGELES A federal jury in Michigan on Wednesday awarded $30.1 million to two men who claim to have created the talking Chihuahua character that was formerly used in Taco Bell ads.

The two plaintiffs, Joseph Shields and Thomas Rinks, filed suit in 1998, accusing Taco Bell of breach of contract and wrongly profiting from the campaign, which featured a talking Chihuahua.

Taco Bell in Irvine, Calif., has said that its agency at the time, Omnicom’s TBWA\Chiat\Day, independently proposed the idea.

Yum! Brands in Louisville, Ky., which owns Taco Bell, plans to appeal the verdict, the company said in a statement. “Taco Bell continues to strongly believe that the Chihuahua character was created by [TBWA\C\D] not the plaintiffs, and we intend to appeal the jury’s verdict,” said Taco Bell representative Laurie Gannon, in the statement.

The company expects the plaintiffs might file for “pre-judgement interest, which if awarded, could range between $5-10 million,” the statement said.

If Taco Bell is unsuccessful upon appeal, it intends to seek reimbursement from its insurance carriers and TBWA\C\D, according to the statement.

Representatives for TBWA\C\D declined comment.

A representative of Warner Norcross & Judd, the Grand Rapids, Mich., law firm representing the plaintiffs, declined to comment and said Doug Dozeman, the attorney handling the case, was not available to comment.