United States: Tap Into Craft Beer Trademarks

Last Updated: September 20 2019
Article by Oliver S. Bajracharya

It will come as no surprise that craft beer is here to stay. The Brewers Association, a craft beer trade organisation, reports that the number of craft breweries has nearly doubled in five years from about 3,800 in 2014 to about 7,300 in 2018, with a majority of Americans living within 10 miles of a brewery

The Brewers Association defines a 'craft brewery' as a small (fewer than 6m barrels), independent (less than 25% owned by a non-craft brewer alcohol beverage industry member) brewery (has an Alcohol and Tobacco Tax and Trade Bureau (TTB) Brewer's notice and makes beer).

The naming of every new brewery – not to mention the naming of several to dozens of beers offered by each – presents an opportunity for creativity, but can leave brewers frustrated due to the sheer number of names already taken. Inevitably, disputes arise and lawsuits are filed.

Craft Beer v Big Beer

The popularity of craft beers has not gone unnoticed by Big Beer, the nickname bestowed by Stone Brewing on the gigantic multinational conglomerates that dominate beer sales in the US. Among other Big Beer acquisitions in recent years, the largest brewing company, Anheuser-Busch InBev, acquired craft breweries 10 Barrel Brewing (2014) and Golden Road Brewing (2015) and, Constellation Brands (the third largest US beer producer with brands like Corona and Modelo) acquired Ballast Point for $1bn in 2015.

"Perhaps unsurprisingly, the band Guns N' Roses took notice that there was a new beer available called Guns N Rosé and filed a complaint for trademark infringement."

Enter Stone Brewing, one of the earliest craft breweries and owners of the mark STONE for beer since 1998. As the ninth largest US craft brewery, Stone prides itself on a "philosophy and approach that defies the watered-down orthodoxy of 'Big Beer'."

Big Beer member MillerCoors (a subsidiary of MolsenCoors) owns a number of 'craft' beer brands, including Blue Moon, Hop Valley, and Saint Archer. Miller has sold its Keystone beer since 1989 – 'Keystone' being a popular Colorado ski town – prominently featuring the Rocky Mountains on the can and in advertising.

"Noting that surly means 'unfriendly or hostile; menacingly irritable', the Trademark Trial and Appeal Board found SURLY to be arbitrary with respect to the goods and services, and thereby inherently strong."

In 2017, Miller introduced a 'refreshed' can design that divided the KEY and the STONE in large letters onto separate lines and eliminated the Rockies imagery. Since then, Keystone Light has gone from the worst to the best-selling of the Keystone line while Stone has noticed a discernable drop in sales.

Stone filed suit for trademark infringement in February 2018 and later filed for a preliminary injunction. In ruling on the preliminary injunction and considering the Sleekcraft factors, the court found the STONE mark to be commercially strong, but suggestive rather than arbitrary for beer due to the can and packaging frequently incorporating a gargoyle, Stone's mascot. Regardless, the court indicated that "STONE® is entitled to the strong protection afforded to suggestive marks." Further, the court found "it is reasonable to consider Miller a direct competitor of Stone," thereby tilting the "proximity of goods" factor in favour of Stone.

Despite STONE being prominently featured on the rebranded Keystone can, the court also noted that a consumer looking at the can is able to "see KEYSTONE Light (twice) as well as the bright yellow house mark of Coors," thereby favouring Miller. The court further indicated it was not able to make a determination based on the submitted evidence as to Miller's intent in "refreshing" its can. The court ultimately denied the preliminary injunction, but found Stone's trademark claim to be "moderately strong".

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