Taco Bell Twice Bitten in Court

CHICAGO A federal judge has ordered Taco Bell to pay an additional $11.8 million to two people who claim to have created the fast-food company’s Chihuahua mascot from the 1990s.

According to the attorneys representing Joseph Shields and Thomas Rinks, the total award in the case over creative ownership of the mascot are now more than $42 million. The pair was awarded $30.1 million in damages in June. The additional money is interest from the time the original suit was filed in 1998 through Sept. 9, 2003, when an amended judgment was issued.

The two men are claiming breach of contract against Taco Bell, which is owned by Louisville, Ky.-based Yum! Brands. The two filed suit claiming they had approached Taco Bell executives at a licensing show with ideas for a Chihuahua mascot. The two allege that after several meetings, company executives broke off discussions, but went on to use a Chihuahua in advertising from former agency TBWA/Chiat/Day in Playa del Rey, Calif.

Taco Bell has said the Omnicom Group agency independently proposed the idea.

“We still believe the Chihuahua character was created independently and we will continue to appeal the jury’s verdict,” said Laurie Schalow, a representative for Taco Bell in Irvine, Calif.

The company is planning to appeal the ruling. Should it lose, the company has said that it will seek reimbursement from its insurance carriers and TBWA\Chiat\Day.