Michigan Sees Gold in Hop Industry, Introduces “Farm to Glass” Bill

HopsWith 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.

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Making Sure You’re Ready for Federal Trademark Registration (And You Probably Already Are).

USPTOWe frequently hear from new breweries that would like to register their brewery name but aren’t sure if they’re “allowed” to register it. For them, it’s less a question of whether their mark is confusingly similar to another mark. It’s more of, do I meet the standards for a federal trademark in the first place?

It’s important to know that no matter how much beer you’re brewing and selling right now, even none, there’s a way to get the ball rolling on a federal registration to protect your brewery or beer name. The United States Patent and Trademark Office will look at filings under section 1(a), where marks are already in use, and under section 1(b), where marks aren’t in use just yet. Section 1(b) is often referred to as the intent to use section.

Even if you file under section 1(b), though, you eventually do have to put your mark into use. But, the good news is, the USPTO gives you up to 30 months to start that use. Breweries often take advantage of this provision when they’re in the planning stages, whether for their brewery or an important upcoming beer. The USPTO just requires that you prove you’re actually using the mark within that timeframe, then you get rights all the way back to the date you initially filed (assuming, of course, your selected mark doesn’t face other potential problems during the registration process).

In other words, if someone else first starts to use a mark that’s the same or confusingly similar to yours after you’ve started your filing process, once you perfect your registration, you’d have superior rights. Of course, one of the other big benefits to filing a section 1(b) is that you’re effectively saying, hey, I’m planning to use this mark, and then others steer clear of future problems by picking a different brewery or beer name in the first place.

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40% of Last Year’s Brewery Permits Went to Four Western States

GrowthRecently, the Washington Post looked westward and reported on the tremendous growth of the brewing industry out this way. There are some cool infographics you’ll want to check out here that do a good job of the telling the story. The bottom line is, of all the permits for new breweries issued last year from the TTB, 40% came from just four states: Washington, Oregon, Colorado, and California. That is, of the 948 permits issued, 322 went to these four states. Yes, it’s a good time to be brewing (and living among this awesome bounty of homegrown brews). Zooming out and looking nationwide, it’s notable that from 2012 to 2013, the number of permitted breweries jumped an impressive 34%.
Brew on, everyone. Brew on.

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$1,800 Bomber? Sheesh.

CellarIf you have the self-discipline to keep a stocked cellar of beer, good on you. And, if you happen to have a bomber of Midnight Sun’s “M” back from 2006, heads up: you’re sitting on a goldmine. With beer auctions no longer on eBay, Auction Houses are picking up where the online giant left off. And, boy, can it be big business. Recently, we saw that Midnight Sun M barleywine has drawn as many as 1,800 green ones. Yowzers. That’s right around $81 an ounce, a price that’s been holding steady for the last couple of years. Of course, it absolutely stings to be the brewery, watching your brews draw big bucks when you sold them for a reasonable amount in the first place.

Auctioning—as it has been in the wine business—is a reality for breweries these days. And, brewers are starting to embrace the increased consumer interest in “vintage” beer by cellaring more and more of their own. After all, there’s nothing like skipping a visit to the bank but still getting a major cash infusion…just by clearing out the basement!

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Dealing with Cybersquatting Scoundrels

WWWThe world is full of awesome people, but has its share of jerks, too. Among the crustiest of the jerks are cybersquatters. What’s a cybersquatter? Someone who goes out and registers domain names that a business owner would want, then holds the domain names at ransom. It can happen to breweries of all shapes and sizes. Years back, Anheuser-Busch hit the headlines when it dealt with someone who had registered micheloblight.com and was using it in improper ways.

If you’ve never had to deal with a cybersquatter, we hope you never do. Still, it’s worth noting that if someone does use a domain you find problematic, there may be options to consider with your lawyer before, if ever, giving in and paying to transfer the domain. Here’s a very brief overview.

Congress has given trademark owners protection through the Anticybersquatting Consumer Protection Act (ACPA), offering a potential route to federal court. Lawsuits, though, are inherently draining—on funds, emotions, and especially time—but the plus side is that, under ACPA, certain remedies such as money damages and even attorney’s fees can be available.

Outside of ACPA, the Internet Corporation for Assigned Names and Numbers (ICANN) has an established arbitration procedure known as the Uniform Domain Name Dispute Resolution Policy (UDRP). Arbitration has the benefit of being much more cost effective and gets to a result in just a few months. However, the only remedy available is a transfer of the domain name.

It’s worth noting that whichever route a brewery goes (and a brewery could even go down both roads), a trademark owner is only protected from certain improper uses. If someone is using a domain name with good faith, perhaps legitimately offering commentary on a set of brews, it can be harder or impossible to succeed under ACPA or UDRP. And, given the expense involved either way and because breweries typically conduct only a limited amount of business online, it may be most economical of all (although maybe not in principle) just to look the other way.

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