Brewing Up Some IP
April 24 2015
By: Josh Escovedo
With so many new microbreweries popping up in Sacramento, the Bay Area, and the Greater San Diego area, I felt compelled to write the present piece for the benefit of the aspiring, as well as the established, microbrew entrepreneur. These individuals undoubtedly pour (excuse the pun) their hearts, souls, and hard-earned money into the development of their breweries and their attempts to formulate the perfect brew. However, from my own research and analysis it seems clear that these entrepreneurs are regularly overlooking one thing in particular—their intellectual property rights.
The thought first occurred to me when I was sitting in San Diego having an IPA with a couple of my friends. As I stared at the bottle on the table it occurred to me that despite my everyday involvement with intellectual property, I had never looked into whether some of these companies were properly safeguarding their intellectual property rights. I immediately went to the United States Patent and Trademark Office (“USPTO”) website on my cellphone and began searching for some of my favorite breweries and their assorted brews on the database. I quickly learned that some of the companies were prudently protecting their intellectual property in their company’s name, certain brews, and certain designs/graphics. However, I also learned that some of my favorite breweries were not doing anything to protect their intellectual property. I discussed the matter with my friends and express how I could not understand why these companies would not try to protect their intellectual property. Then, it occurred to me that some of them probably never thought about it, or were simply unaware what types of protection exist under the intellectual property laws. After all, prior to my involvement in the intellectual property world, I never thought about trademarks, trade dress, copyrights, or patents. Accordingly, I decide to draft this brief, non-exhaustive discussion of trademark law’s application to the microbrewery industry and suggest that breweries consider protecting their rights as they grow as businesses.
Federal Law, or the Lanham Act, defines “trademark” as any word, name, symbol, or design, or any combination thereof, used in commerce to identify and distinguish the goods of one manufacturer or seller from those of another and to indicate the source of the goods. Thus, any words, symbols, or designs that consumers may use to identify the source of the product are trademarks. We see these everyday when we step outside of our homes. Common examples include McDonalds, Starbucks, or a more suitable example in the context of this article, West Coast IPA. The latter is a federally registered trademark by the Green Flash Brewing Co. It is a clear example of a trademark in that it is a series of words and/or a name that is used in commerce to identify and distinguish the goods of the manufacturer/seller. Unfortunately, I cannot take the credit for Green Flash Brewing Co.’s prudent protection of its intellectual property rights, but the up and coming microbreweries can certainly take a lesson from Green Flash Brewing Co.’s conduct and follow its lead.
In order to gain this type of protection under the federal trademark law, there cannot be any other mark that is “confusingly similar” to your mark such that it will create consumer confusion as to the product’s origin unless your use in commerce preceded that mark. On the other hand, if there are no marks that are confusingly similar to your own, priority of use does not come into play and the applicant seeking trademark registration can file what is known as an intent to use application. The latter essentially says that the registrant intends to begin using this product in commerce in the near future and seeks to register the mark in advance. This is an oversimplified explanation of the rules, but this article is intended to provide a general overview—not a detailed legal analysis.
Assuming the mark meets the requirements of the USPTO, and there are no successful challenges by other trademark owners, it will eventually be registered and the world will be deemed on constructive notice of its existence. The effect of this is that the registrant can then pursue anyone in the United States who uses a mark that is “confusingly similar” to the registrant’s duly registered mark. In the absence of such a registration, the party would be left with much less extensive trademark rights and remedies. Accordingly, it is prudent that up and coming microbreweries and established breweries that have yet to take action in protecting their intellectual property get in contact with an intellectual property attorney as soon as possible to develop a plan for protecting their intellectual property rights.
Although it is implicit in the discussion above regarding how a mark designates the product’s origin, it is important to completely understand why trademark protection is so important. Any entrepreneur I have ever met would tell you that they want to benefit in some form or another from the blood, sweat, and tears that they put into their work. One way that can be achieved is through building up goodwill in one’s mark and having consumers come to associate that mark with high quality. Ideally, a brewery would develop a brew that consumers associate with high quality microbrew. Specifically, they would come to associate the name of that brew with quality—for the sake of the example, let’s call it Weintraub California American Pale Ale. After developing such goodwill in the mark, it would be unfair if someone were allowed to benefit from the goodwill of the mark Weintraub California American Pale Ale by releasing Weintraub California India Pale Ale, thereby falsely indicating that the same brewery produced both products. Obviously, it would be fine if the same brewery created both products, but you can see how this creates a problem if the products are being produced by separate entities. That is exactly the type of problem that trademark protection seeks to prevent and that is exactly why it is imperative that new and established microbreweries immediately seek out intellectual property counseling if they have not already done so.
I’ve yet to encounter an area of the law where an inch of preventative measures would not have gone a mile later down the road. With that said, please drink and protect your intellectual property rights responsibly.