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Shapley’s lawsuits vie for use of steakhouse name

By JACK WEATHERLY

Scott Koestler contends that the name of the Ridgeland steak and seafood restaurant he has operated for 20 years, Shapley’s, belongs to him.

Koestler said in a response filed Friday in the U.S. District Court for Southern Mississippi in answer to a suit filed March 7 by Mark and Mary Shapley that in 1998 he bought the steakhouse assets for $1.69 million, including the name and the right to use it. Equipment and inventory were valued at $278,000.

The assets included the “goodwill,” for which the Koestlers paid $1.41 million, among other intangible assets, including a noncompete clause (within 50 miles, in this case) and the value of the business as a going concern.

The trademark was not sold to the Koestlers and the agreement to use it will expire with the lease on June 30, the Shapleys maintain.

Koestler said in the March 30 filing that he intends to open a steakhouse at the former location of Ruth’s Chris Steak House in Renaissance at Colony Park. That steakhouse closed recently. It was one of about 150 in the chain of that name.

Mark Shapley has established a website as M+M Shapley’s with the message “coming back this summer to the building at 868 Centre St. off County Line Road that has been home to the restaurant since it opened.” A call to number on the site, 957-8000 was not answered.

Shapley posted on his Facebook page March 27:

“Hey friends, You know I don’t post often but I wanted to inform and confirm that this summer, Mary and I are going back into our restaurant business in our original location on Centre Street. We are very excited about this opportunity and plan to continue the same great menu and service that you came to know from us years ago.”

That post came after the news of the parting of the ways surfaced.

The reference to “years ago” was played up in Koestler’s response to the Shapleys’ suit.

The original owners and operators have not had a hand in the operation of the eatery since after the sale to the Koestlers 20 years ago, the Koestlers say in their response.

Meantime the Koestlers say they have built the brand.

The Koestlers registered the brand with the U.S. Patent and Trademark Office on March 31, 2009. They note that the Shapleys did not contest the registration until more than eight years later, Sept. 11, 2017.

Had the Shapleys been diligent and challenged the registration earlier, that would have given the Koestlers time to establish another brand, the defendants said.

The Shapleys asked the court to find that they have the right to use their own name in the name of any new restaurant they may open.

The Koestlers said in their response that “under the Asset Purchase Agreement, ownership of the common law ‘Shapley’s’ service mark transferred to Koestler.”

Both sides urge Judge Carlton W. Reeves to grant a jury trial and expedited resolution in time for business plans to proceed.

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