Running Out of Hoptions: Craft Beer Trademarks in North America

What’s in a name? In the craft beer industry, evidently, a lot. As craft beer’s popularity rises in North America, new breweries and tasty beers are popping up around the continent. But so are numerous legal claims over trademark infringement. Breweries often opt for pun-based brand names, and legal disputes are increasing as these puns are being scooped up by the influx of new brewers, in what many consider to be an industry based on camaraderie.

Currently, over 20,000 beer-related registrations and applications are active on the United States Patent and Trademarks Office’s database. Competition to acquire trademarks to creative label names is stiff. For example, a Portland brewery—Hopworks Urban Brewery—and a Seattle brewery—Fremont Brewing Company—both sold beers called “Abominable Ale.” Instead of litigating, the two breweries amicably discussed the matter, concluding that Hopworks used the name first. Fremont removed the name and responded to fan inquiries by tweeting “Litigation is for suckers, craft beer is for lovers.”

Even though most of the naming claims get resolved out of court, some still proceed to litigation. The Brooklyn Brewery Corporation v Black Ops Brewing Inc. revolved around the use of the term “Black Ops.” Brooklyn, a New York-based brewery, had the registered trademark “Brooklyn Black Ops,” and used the name on a beer since 2007. Their use predated the launch of a similarly named California brewery. Brooklyn argued that the California brewery’s infringement on their trademark would cause them to “suffer irreparable harm.” The court analyzed eight factors from AMF Inc v Sleekcraft Boats to determine the likelihood of consumer confusion, including;

1) the strength of mark;
2) proximity of goods;
3) similarity of marks;
4) evidence of actual confusion;
5) marketing channels used;
6) type of goods and degree of care likely to be exercised by the purchaser;
7) the defendant’s intent in selecting the mark;
8) and the likelihood of expansion of the product lines.

The court weighed these factors, and found possible confusion for consumers about the source of the Black Ops beer. It granted a preliminary injunction in favour of Brooklyn, barring Black Ops from using the name “Black Ops.” They’ve since changed their name to “Tactical Ops Brewing.”

Canada has also seen Trademark issues in the craft beer community. In late 2015, Ontario-based Bad Apple Brewing Company’s owner reportedly contacted Nova Scotia’s Bad Apple Brewhouse, giving it the option of buying the trademark for over $100,000, renting it, or limiting their sales to within Nova Scotia. The Nova Scotia Brewhouse was able to work around this problem by incorporating assets into a new company called “Mosaic Brewing Co.”

Other, non-craft alcohol institutions have also been implicated. The Ontario government challenged the logo of an Ottawa craft distillery—North of 7—claiming it was too similar to a highway sign. The government was concerned that consumers may believe they approved of and endorsed North of 7’s products. In lieu of going to trial, North of 7 decided to change their logo.

Not all disputes need end with a changed name or logo, however. In the U.S., Chicago’s Field Museum and Toppling Goliath Brewing Co. reportedly came to an agreement that benefitted both parties. The Museum was concerned about the use of an image of their T-Rex, Sue, on Toppling Goliath’s “PseudoSue Pale Ale.” After some discussion, both parties realized they could profit by temporarily giving the Museum sole distribution of PseudoSue Pale Ale, and any other Toppling Goliath beer in Illinois. The beer is now available at the Museum.

As beer trademark actions increase—especially in an industry where names can make or break a brand—so will breweries’ investment in precautionary measures. Breweries must diligently protect their IP, and ensure they do not infringe on others’ IP rights to safeguard against future litigation. If a conflict arises, breweries should look to collaborate and resolve differences outside of the courts, much like the Field Museum and Toppling Goliath. Thankfully, there are now craft beer boutique law firms specializing in trademark filing and monitoring. However, as clever puns continue to run dry, it is likely that claims and disputes will persist.

 

Ryan Parson is an IPilogue Editor and a JD Candidate at Osgoode Hall Law School.

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