Before You Spice Your Chicken: The KFC Trade Secret
Just this year, Kobe and Bozeman died. We almost had WW3 in January. An asteroid was expected to hit the earth in April. COVID-19 happened, and Madagascar scammed us. We also found out that Wizkid and Davido don’t operate the Gregorian calendar. If not, they would have dropped those albums since normal people entered July. Kanye pissed on a Grammy (this is not a Burna Boy sub, please). George Floyd died. Australia and Beirut were literally on fire. And now in September, someone is claiming to have revealed “one of the world’s most valuable trade secrets.”
On September 16, 2020, at 6:15 am (WAT), a Twitter user (@amahle_faku) caused quite a stir on the microblogging platform. She posted a list of 11 spices and their measurements in retaliation for being fired by KFC South Africa. At the time of writing this piece, “valar dohaeris” has gotten over 31 thousand likes and 12 thousand retweets. I must confess, the comments section is wild. While some are more concerned about opening their own “Kalamity Fried Chicken,” others are bothered about whether the young lady has enough money for a lawsuit.
Trade secrets are, literally, confidential trade information. It is a form of IP protection that safeguards the processes, formulas, technologies, designs, or other knowledge that grants a commercial or market benefit to a person or organization. The Kentucky Fried Chicken recipe, McDonald’s Big Mac Sauce Recipe, Coca-Cola Formula, and the Google Search Algorithm are some of the world’s biggest, most protected, and most valuable trade secrets in the world. These trade secrets are, apparently, not known to the world, and they contribute to staying afloat from any competition.
To maintain a trade secret, the owner must ensure three things. First, the information must not be disclosed to the public. Second, the trade secret must have relevant commercial value. Lastly, the owner must take reasonable steps to maintain the secrecy of the information. Most trade secret holders do fulfil these requirements. Companies ensure to limit access to and knowledge of the trade secret. As a necessity, they also make employees and partners sign confidentiality agreements. These agreements include Non-disclosure agreements and Non-compete agreements. NDAs ensure that people to whom trade secrets are revealed do not reveal them to anyone. Non-compete agreements, on the other hand, prevent employees from working with a competitor during and after employment with the organization.
The KFC recipe was drawn up in 1940 by Colonel Sanders, the founder of KFC. It is popularly acclaimed to contain 11 herbs and spices. KFC stores the recipe in a vault in the company’s Kentucky office. To further protect this age-long secret, it is rumoured that only two to four top-level executives know the key to the vault, and the contents of the recipe. In fact, the production process for making the pressure-fried chickens is divided into two stages, with two companies working differently on the two phases. Over the years, there have been claims to knowledge of the recipe. In 2016, the nephew of Colonel Sanders’ second wife reportedly found a will that contained a “copy of the recipe” In the end, all of the alleged recipes have been a mere cruise.
While I can’t say if the recipe released on Twitter is true or false, I’m sure of a couple of things. KFC operates one of the world’s largest franchises. A franchise is a licensing agreement that allows a third party to produce and sell a product using the principal business’ trademarks, brand name, and proprietary knowledge. However, franchises do not ever have the entire trade secrets of any company.
During production, franchises only have access to basic ingredients which are regularly tweaked by franchises. That’s why Coca-Cola in Agege tastes different from Coca-Cola in Alabama. The ex-employee (who probably works at a South African franchise) may have just revealed generic ingredients that could have undergone some modifications by the franchise.
If the recipe turns out to be KFC’s original recipe (after all, we’ve seen 2020 offer worse things), there are two things involved. The first is, the recipe released is practically useless. Why? KFC’s recipe may not even be significantly special, but it has created one of the world’s largest franchises. Even if your “Kalamity Fried Chicken” gets to taste better, what are the odds that you can pull the same commercial reputation? Until something very significant happens, the KFC franchise can only get stronger from here on.
Secondly, if the ex-employee is bound by NDAs and non-compete agreements, she may face lawsuits for breaching them. However, NDAs and non-compete agreements are very tricky matters of law. Some agreements may be too vague for a court to enforce. Others may be validly breached in the case of wrongful termination or other wrongdoing by either party. The court may rule that some agreements are unreasonable, oppressive, and confers more power on one party than the other. If KFC decides to sue and finds itself in any one of these exceptions, the agreements are as good as worthless. If not, the ex-employee may just run bankrupt from paying damages. If ADR mechanisms are followed, the results may be quite unpredictable.
There’s still a long way to go in preserving and enforcing IP rights in many jurisdictions, but we’ll stop here for today.
P.S. Bread, beans, and dodo >>>>> KFC.
Author: Lekan Adebanjo (Head, IPTLC-UI Research Team)