Craft breweries and IP infringement: What’s the risk?

Recent case between rock legend and brewery provides an example.

Craft breweries are accused of having little respect for intellectual property rights. Craft breweries marketing brews like Spidey Sense Saison and Frosted Fruited Sour appear to use well-known products to springboard their brews into popularity.

What harm could a bit of wordplay cause? When it comes to IP infringement cases, the harm can be pricey.

A recent case involving rock legend Guns N’ Roses provides an example. The heavy metal band was not impressed when a brewery chose to name a brew Guns N’ Rosé. The dry, fruity beer has a striking black-and-pink label with the name, approved by the federal Alcohol and Tobacco Tax and Trade Bureau. The name, according to the rock band, is a clear violation of Guns N’ Roses trademark protections.

Does the band have legal recourse?

Yes. The band has registered the name “Guns N’ Roses” for trademark protections. Although legal recourse is likely available, these cases generally begin with an attempt to resolve the conflict without litigation. The band took this course and first attempted to resolve the issue through an informal conversation. The band claims a representative reached out to the brewery to request it change the name of the popular brew. When the conversation proved unproductive, the band had their legal counsel send out a cease-and-desist letter. When this also failed, they moved forward with a lawsuit.

The brewery fought back. Like most things in the legal world, the answer may not be as clear as it appears. The brewery, which proudly states it has disrupted the status que since 2002, claims it is not infringing on the band’s trademark protections. It states trademarks are generally given for specific categories of products. As a result, the brewery contends the band’s trademark of Guns N’ Roses focuses specifically on use for musical recordings, performances, clothing and the like. The brewery argues the band’s protections do not extend to include alcoholic beverages.

How did the lawsuit progress?

Part of the brewery’s argument: they are not the only alcoholic beverage manufacturer to use the name Guns N’ Rose. The brewery provides evidence of at least two other wine companies using the same name for rosé wine products.

At this point, the band took an interesting legal strategy. It decided to use the “famous” argument. This argument essentially allows additional trademark protections if the trademark is “widely recognized” throughout the country by the public. Examples of successful trademarks that receive this additional protection include McDonald’s and Apple. If the case were to move forward, the band would need to establish that its name is so well known almost everyone in the country would recognize the trademark as belonging to the band.

Ultimately, the two decided to settle the claim.

What was the harm?

The conclusion of the dispute brings us back to the original question: what is the harm when craft breweries, or any business for the matter, thwarts the protections offered intellectual property? The clearest answer: financial. Although we do not know the details of the settlement in this case, it was likely an expensive one for the brewery. The brewery may have game gained popularity for the brew with the name, but it may have come with a steep financial cost. In addition to the fees paid during potential litigation or through a settlement payment if the use is challenged, the business violating the IP protections may need to scrap all marketing materials using the controversial name.