Posted on | March 10, 2014 | No Comments
If you don’t live or brew in a state with an ABV limit, you may not know such a thing exists. But, for brewers and consumers stationed in the states that do, the limits have a big impact on what you can find on the shelves and put in the brite tank. Just as you know that a brewer, with a brewer’s permit, can’t start churning out something like whiskey, the laws in some states limit the strength of beers you can brew on your permit. In turn, this limits what can be distributed within the states, too.
Given that other kinds of higher-ABV alcohol is available, it seems outdated to restrict the beer market in this way. For starters, these laws discourage out-of-state brewers from coming in state, which means package stores and distributors aren’t doing as well, either. Of course, it also means that interested consumers near state lines are taking their dollars to other states, as this thoughtful article points out.
But, the ones hurt most by these laws tend to be in-state brewers. As they hope to expand their business and begin distributing in other states, these brewers are simply unable to offer as diverse a lineup on the interstate market. In recent years, these caps have been as low as 6%—imagine a brewery that could never, ever craft a beer that crossed that threshold. In fact, at one point, Vermont’s The Alchemist couldn’t even brew its now-epic Heady Topper, which only clocks in around 8% ABV.
We’ve posted recently about the value in a unified brewers voice, and fortunately guilds are starting to successfully change these laws, which is paying off. For example, Mississippi has seen 5x growth in its brewing and distribution industry since shifting from a 6% ABV cap to a 10.2% one in 2012. Still, although we can understand, maybe, a state’s interest in not serving such high-ABV beers at bars and restaurants, where consumers might be behind the wheel soon, it just doesn’t seem right to maintain an all-out ABV cap for beer—even at 10.2%—when liquors in the 30-50% range are already readily available. Hopefully, as consumer interest in all kinds of beers and barley wines continues to grow, we’ll see even more change in these laws, too.
Anheuser-Busch Fighting for Strong Trademark Rights in BUD, TTAB Will Hear Oral Argument in WINEBUD Trademark Dispute
Posted on | March 7, 2014 | No Comments
There’s an interesting trademark dispute teed up and set for oral argument in front of the Trademark Trial and Appeal Board (TTAB) in a couple of weeks, Anheuser-Busch Incorporated v. Innvopak Systems PTY LTD (Opposition Number 91194148). Back in 2009, an Australian company sought registration for the mark WINEBUD on wine products. The mark went through to publication, when Anheuser-Busch opposed it, contending that WINEBUD is confusingly similar to its BUDWEISER mark and family of BUD marks. A-B has also raised a claim of trademark dilution.
Both parties’ briefs relating to A-B’s motion for summary judgment are well worth a read, and suggest that this oral argument is poised to be a spirited one. Notably, Anheuser-Busch pulled out the stops and conducted an expensive consumer survey where it seemed 24% of surveyed consumers would be confused, a significant percentage, but not enough to win on summary judgment.
The Australian company seeking registration of WINEBUD throws some punches in the briefs, maybe needlessly ribbing A-B for some of the survey responses: “BUD — generic term for bad American beer.” They really hang their hat on distinguishing the “BUD” formula from their mark. Evidently, in addition to BUDWEISER and BUD, A-B has registrations for these marks:
BUD ICE LIGHT
BUD LIGHT GOLDEN WHEAT
BUD LIGHT LIME
The Australian company characterizes them as BUD + [Descriptive Term], distinguishing them from their no-space, Bud-comes-last use in WINEBUD, which they say is a play on “vinebud,” a viticultural term.
The timeline on this dispute reveals it’s been a long haul for both sides, with the summary judgment denial all the way back in October of 2011. There’s no doubt this is a big matter for A-B, in seeking to carve out as much turf as possible for anything BUD, so their efforts are unsurprising. What’s maybe more interesting is the heels-in-the-ground position of WINEBUD over these past few years, a company/product/brand we can’t seem to find out too much about, except for a patent application related to alcoholic beverage packaging.
We’ll keep you posted on how this one turns out.
Posted on | March 5, 2014 | No Comments
This legislative session, the Virginia Craft Brewers Guild has found lobbying success yet again. Over the past few years, the Guild has sought passage of key bills to fuel the state’s tremendous brewing growth. Among them was Senate Bill 604, which paved the way for taproom consumption in 2012 (and, since then, Virginia has seen an astounding 75% growth in operating breweries). This year, the Guild’s focus was on a Farm Brewery bill, giving a formal definition to farm-based breweries, akin to the state’s existing approach to farm wineries. After flying through the legislature with broad support, Senate Bill 430 awaits a signature from Governor Terry McAuliffe, who likely won’t stand in the way of a bill that’s poised to spur much-appreciated investment and tourism dollars to rural parts of the state.
The Virginia Craft Brewers Guild’s marked success over the years is emblematic of just how valuable—and, in our minds, essential—a strong, unified brewers voice can be in growing and shaping the future of brewing. Of course, it’s increasingly difficult for states to ignore the tremendous economic impact of this rapidly growing industry—representing more than 8,000 full-time jobs and over $600 million in the state of Virginia alone. Hats off to the VCBG!
Posted on | March 3, 2014 | No Comments
After years of perfecting recipes, then naming the brewery, securing funding, and seeing how close your dream is to becoming reality, there’s no doubt that breweries are eager to get brewing on a big scale. Even for existing breweries, expansion into a new, bigger facility is a really exciting thing. But, all too often, we’ve seen breweries set back big time by overlooking just how important zoning and permitting is to the overall business plan. It can be a costly surprise that potentially lurks in the future. But, it’s one that most breweries can avoid altogether by taking time and care up front with their lawyer.
Zoning ordinances restrict just how you may and may not use your property. Permits dig into the details, dictating things like whether your brewery can proceed with its construction plans or just how many people you’re allowed to have in the taproom. By not taking careful measures up front, a brewery can put its very business at risk. For example, if you sign a lease for a facility without being absolutely sure just how the property is zoned, you risk having to plead your case in front of a commission, which may or may not grant you a zoning variance to do all the things you planned to do when you signed that lease (see here, for example). Likewise, if you proceed with expansion plans without dotting those “i”s and crossing those “t”s, the city can stop your brewery’s construction in its tracks, causing very costly delays (see here, for example).
For a new or expanding brewery, it’s not only important to make sure you’re prepared to meet demand with the best beers you can possibly brew, but it’s also mission critical to make sure you go about executing your business plan in a way that won’t put your business on the line. Fortunately, tackling zoning and permitting issues with your lawyer in advance will help you get ahead of any potential issues and take smart steps to avoid them, avoiding costly “surprises” down the road.
Posted on | February 28, 2014 | No Comments
With the boom in home and commercial brewing, hop shortages have become a real problem. And, Midwestern states are trying to ramp up production to meet demand, gaining ground on the successful hop industry out in other parts of the US. Michigan, in particular, is eager to establish itself as the Midwest’s premier source of quality hops. Given the state is right around fifth in the nation for its brewery count, the efforts make some sense.
Not only are hop farmers themselves banding together to grow the industry, the Michigan legislature is encouraging in-state and out-of-state producers to make beer as “Michigan” as possible. Introduced this session is a “Farm to Glass” bill that would offer tax breaks on beer, cider, mead, and wine that’s made with Michigan ingredients and sold in Michigan. The bill sets a threshold for just how much Michigan must be in every brew. To start, beer must have at least 20% of its hops produced in Michigan along with at least 40% of its other ingredients. Wine, mead, and cider also must meet the 40%-Michigan-ingredients threshold to qualify. Interestingly, that percentage requirement would be in effect over the next five or so years and then, in 2020, the percentage requirements would increase. Producers would get a break of 8 cents per gallon up to 500,000 gallons and then 4 cents per gallon for next next 14,500,000 gallons.
A thriving, diversified, and reasonably priced hop market is good for producers (and imbibers), so if the Midwest can introduce some new strains or put a dent on the existing shortage, we see it as good news—even if the mechanics of the tax break make it easier on Michigan producers to ultimately meet the requirements.keep looking »