Take Two for August 27, 2013

Trader Joe's sues Canadian 'Pirate' reselling items in Vancouver

Pirate Joe's

Courtesy Michael Hallatt

Michael Hallatt runs Pirate Joe's, a Vancouver-based store that sells Trader Joe's products.

When you think of Trader Joe's, what comes to mind? Peanut butter-filled pretzels, Two Buck Chuck, Lemon and Triple Ginger Snap Ice Cream, perhaps?

Whatever your favorite snack is, one thing for sure is we have it pretty sweet here in southern California with plenty of Trader Joe's markets to choose from. But what to do when you go on vacation or move away? 

If you happen to be in Vancouver, Canada, you are in luck. At least for the time being. Michael Hallatt runs a shop there called Pirate Joe's, offering Trader Joe's products he's smuggled across the US-Canada border. 

"We're selling a lot of cookie butter for some reason, and then also plantain chips, and chocolate covered stuff, you can probably guarantee that we're going to be out of stock of the dark chocolate sea salt almonds," said Hallatt on Take Two. 

Trader Joe's is not too keen on Hallatt's entrepreneurial venture. The company filed a lawsuit in Washington State in May, and lawyers for Pirate Joe's responded with a motion to dismiss.  

Hallot first opened the shop a couple years ago after moving back to Canada after a several years-long stint in California's Bay Area. It was there that he became smitten with Trader Joe's products, and began craving them when he was no longer anywhere near a store.

"The closest Trader Joe's is a gauntlet drive of about 80 miles through a border. There's a tunnel in there and it's not a lot of fun," said Hallatt. "I thought maybe there's a way to make it a little easier, I looked into the law and we went ahead and opened a reselling store. It's a tiny little grocery store and we sell a few other things, but principally we sell what people ask us to bring in and that's Trader Joe's products."

In the beginning, Hallatt worked out a deal with the nearest store in Bellingham, Washington to pick up a large number of certain items. However, corporate caught wind of his scheme and barred him from shopping  at that location. 

"I was asked not to come back and of course the store was open so I had to decide was I going to quit or hold my ground," said Hallatt. "That ended up with me driving down as far as Portland to go to all the different Trader Joe's in the area."

In order to not clean out a store of a certain item, Hallatt would drive to several stores with a long list, piecing his inventory together until he completed his order. 

The one thing I tried to do was not disrupt Trader Joe's business by going in and clearing out  section, I didn't think that was fair game, so instead I've designed a system where we get a couple of things from a large list and just migrate to all the different stores and eventually end up with what we need to get through the week. 

Still, the future of Hallatt's business is all dependent on the outcome of the lawsuit. If a judge sides with Trader Joe's Hallatt will be out of a job. If they side with Hallatt, he will continue to traverse the U.S. to stock his Pirate Joe's store. 

"I'm going to push back, and that's kind of what underpins my challenge back to them in court, which is, show me the harm," said Hallatt. "We're doing nothing but good things for Trader Joe's up in Vancouver, a lot of people come in and shake my hand, thank me for either introducing them to Trader Joe's or helping them get more Trader Joe's stuff."

UPDATE: Trader Joe's is not speaking on the issue due to a policy against commenting on pending legal matters. However, Freakonomics recently debated each side's argument for a better understanding of the case.  

Here's a copy of the complaint: 

 


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