Starting a Brewery?
Remember You Aren’t “Crafting” in a Bubble.
By: Entrepreneurship & Innovation Clinic Student
November 2016
I will start by saying-- lawyers are not evil beings trying to stifle your creativity! I think intellectual property lawyers get a bad rap sometimes for shutting down your “brilliant” ideas. Lawyers do not dispute the brilliance of your idea; they are merely telling you that your idea is so brilliant that others may have already thought of them. Lawyers simply want to protect you from the potential legal consequences of infringing on someone else’s mark. They are not looking to shut down every idea you have.
Now that we have gotten that out of the way, let me tell you why you can’t use that brilliant name for your beer.
The craft beer industry has recently come upon a dilemma—they are running out of beer names! According to the Brewers’ Association’s mid-year report, the craft beer industry continues to grow—in the past year, the total number of breweries (4,656) has grown by 917 breweries and there are approximately 2,200 breweries that are in the planning stages. With each of these breweries creating multiple varietals, there are a crazy number of catch pun names that have flooded the market. According to The Wall Street Journal, there are at least 25,000 active trademarks registered or in the application stages with the U.S. Patent and Trademark Office in connection with the beer industry. As such, new brewers looking to enter the market should be wary when it comes to “crafting” beer names.
How You Can Protect Yourself Against Litigation
1. Search the web. Seems simple, yet many business owners forget this step. Make sure someone within the beverage industry isn’t already using your name. Trademark protection is based on use. The first person to use a mark in commerce, owns the mark for the particular class they are using the mark within.
You should not limit your search to your exact name- look for variations. Trademark infringement is based on likelihood of confusion. The important question to ask is—would a consumer believe this company who is using a name similar to mine produces my product? Trademarks do not have to be identical in order to be found confusingly similar.
If your search results in multiple uses of the name, then it is likely that this name is within the public domain and free for you to use. Just remember, if the name is in the public domain then you will not be able to trademark it, which means other breweries will also be able to use that name. This is probably not smart if you are trying to build branding around the name. Proceed with caution.
2. Run a trademark search within the federal and state registries. If a mark is registered with the USPTO or Secretary of the State, you are on notice regarding its existence. This is important. Should a company decide to bring a suit against you for trademark infringement, the court will presume you knew of the prior trademark when you crafted your own name.
It is also important to check the registries because companies may have registered an intent to use application. This means the mark is reserved and the company intends to use it in the immediate future. The only way of discovering these marks, in some cases, is through a trademark search with the USPTO and Secretary of the State (should the state allow Intent to Use filings).
You can search the trademark registry at USPTO.gov. Remember to search both for your mark and any variations on your mark. You are able to limit your search to a particular class of goods. If a mark is being used in a similar industry, it is more likely that a consumer would be confused as to the origin of your product. You should play particular attention to other beverage or food companies using your name or a variation of it.
3. Parodies of Famous Marks. You may be tempted to create puns off famous trademarks in the world, such as Captain Crunch or Twinkie. A brewery should think twice before using a famous trademark in the name of their beer. There are certain fair use exceptions. One exception is the parodying of famous trademarks. But, this is a tricky exception to navigate. Famous trademarks are entitled to protection against dilution by blurring and dilution by tarnishment. When a company uses a famous trademark as a part of their trademark, they are not protected by the paradoxical fair use defense because of the dilution that occurs.
4. Use of Famous Names. Avoid using the names of celebrities in your beer names. Celebrities have a right to publicity that would prevent the use of their name in a way that suggests their endorsement of the product.
5. If you have any questions, consult a lawyer. Intellectual property lawyers are experienced in running trademark clearance searches and are in the best position to inform you of the risks associated with using a particular name. Here at the Entrepreneurship and Innovation Clinic, we are happy to guide you through the process and work with you to weigh the risks of using a particular name.
How You Can Protect The Name You Choose
1. File with the USPTO or Secretary of State. Please remember that once you decide on a name, it is in your interest to file for a trademark with the USPTO (if you are engaged in interstate commerce) or with the Secretary of State (if your activity is limited to in-state commerce). This will put the rest of the industry on notice that your name exists.
2. Enforce Your Mark. Check every so often (i.e. run web searches, read industry magazines) and make sure your name is not being infringed upon. Should you find someone who is using your trademark or another mark in a confusingly similar manner, you should send a cease and desist letter and take any additional steps to enforce your mark. If you do not take these steps, a court may find that you have abandoned your mark through your failure to police.
NOTE: This blog post is a general overview of the law and is not intended to represent or replace legal advice. Readers should consult a lawyer within their jurisdiction before taking any action or refraining from act based on a reading of this post.