It seems a dozen new craft brewery brands come on the market every week, from every corner of the country, and many from overseas. In fact, trademark attorney Nicholas Wells, of Legends Law Group, Inc. noted that in 2005, the U.S. Patent and Trademark Office received a total of 1140 applications to register a brand that included “beer.” By 2018, the annual total was 5142, an increase of nearly 500% in just over a decade.
With so many new entrants, the field becomes “crowded,” so that it can be difficult to come up with a brand that doesn’t clash with an existing product. More accurately, it requires creativity and planning.
While some of the new craft brewery brands come from the major producers such as Anheuser-Busch, many others are from start-ups that are unfamiliar with best practices in launching a new product. The result is a growing number of trademark disputes between craft brewers.
Station 26 Brewing of Colorado recently dealt with this on their 303 Lager brand. Anheuser-Busch, part of the Belgian parent InBev, recently applied to register a number of area codes, including the 303 area code of the Denver area, in connection with various beverages. This directly conflicted with the 303 Lager produced by Station 26 Brewing. Yet the claim has been made that Anheuser-Busch applied to register the area code trademarks simply to keep them out of the hands of others-what are called defensive trademark registrations. U.S. trademark law does not allow defensive trademark registrations, but the law would require someone to challenge Anheuser-Busch to prove its real intent as to the trademarks. A better approach would have been if Station 26 Brewing had filed for its 303 Lager brand when they first conceived the product.
In another recent case, North Coast Brewing Co. of Fort Bragg, California settled a trademark dispute related to their Thelonious ale that arose after the estate of the late jazz pianist Thelonious Monk complained about use of the name Thelonious.
Aparently, the jazz singer’s son had previously granted a license allowing North Coast Brewing to use Monk’s name and image for their 9.4 percent beer, but then the son (through the estate), later objected when North Coast Brewing used the singer’s image on a range of other products that were being sold as adjuncts to the beer itself. Financial terms were not disclosed, but the Thelonius beer remained on sale during the dispute.
Once again, best practices would suggest greater care to secure appropriate licenses to the names and images used on a craft brew, or to check carefully for potentially conflicting rights held by third parties in the trademark or trade dress of the brand.
Myriad other disputes in the field of alcoholic beverages mirror these two recent examples.
Before launching a brand, small business owners should consult an experienced trademark attorney to review their business plans, search for conflicting trademarks, and determine which aspects of their branding-such as words, taglines, logo designs, and packaging elements, can be protected as intellectual property.
The trademark laws allow a business to reserve a name through an “intent to use” trademark application, long before the brand is actually launched. While this ties up capital through legal expenses that may be scarce for a startup business, the alternative is to launch a brand with the risk of having to entirely re-brand the product-and lose all of the associated goodwill-if an accusation of trademark infringement occurs down the road.
Trademark attorneys recommend at least a modest amount of research to check for conflicting names. Because the legal standard is “likelihood of confusion,” rather that identical marks, it may not be possible for business owners or attorneys without experience in trademarks to determine the actual level of risk for using a brand that is somewhat similar in this crowded field. While it is true that differences in logo design and adding distinguishing words may help to avoid a clear conflict, a little creativity at the outset can save a lot of headaches later on.
At least there is one piece of good news when reviewing the list of trademark disputes in the craft brewing industry: participants are generally cordial and will cooperate to allow someone who acted in good faith a little time to make changes. Few cases end up court, but a lot of trouble and lost goodwill can be avoided by more up-front planning and a little professional advice.