New Brewery Trademark Lawsuit: DuClaw Brewery, LLC v. Left Hand Brewing Company, Inc. (Docket Number 1:14-cv-00908)

In addition to the present “Nitro” TTAB tussle, Left Hand Brewing Co. is now involved in a different brewery v. brewery trademark dispute, a full-blown case that has spilled into federal court. This time, the matter is DuClaw Brewery, LLC v. Left Hand Brewing Company, Inc., Docket Number 1:14-cv-00908  filed in the District of Maryland. Based on the complaint and a bit of research, it seems this dispute will come with some tough consequences—unfortunately, ones that again could have been avoided through early registration of selected beer names.

Left Hand has not yet answered the complaint, filed by DuClaw on March 24, 2014, so facts from Left Hand’s official perspective are a bit limited. Still, information from the Great American Beer Festival archives helps flesh out the essential timeline.

The dispute involves two beer-category trademarks filed by DuClaw back in 2001, one for Sawtooth (Reg. No. 2571434) and one for Black Jack Stout (2571432). DuClaw claims they first started using both marks back in November 1998.

On the flip side, Left Hand currently brews a Sawtooth ESB and a Black Jack Porter. Left Hand does not hold federal registrations for those marks, however Left Hand has been brewing under those names for about four years longer than DuClaw. Indeed, Left Hand lore has it that Sawtooth was the brewery’s first batch of beer when they opened their doors on January 22, 1994, and that year Left Hand won GABF Gold for  the Sawtooth and Bronze for the Black Jack Porter.

It’s pretty clear that Left Hand started using the Sawtooth and Black Jack names before DuClaw, but never obtained a federal trademark registration. That makes all this a bit messy, and not a neat victory that maybe DuClaw was anticipating. Left Hand is technically a senior common law user, with superior rights to DuClaw’s in whatever trading territories Left Hand had established on the date DuClaw filed for the marks, September 20, 2001. Put another way, when you file a federal trademark, you get nationwide rights but you take them subject to whatever existing users are out there. Back in 2001, it might not have been as easy for DuClaw to run a thorough trademark clearance search to find users like Left Hand. Maybe they would have avoided the names. Still, keep in mind, the law doesn’t care if DuClaw picked those two names just because they saw Left Hand using them and really liked them. (Note, though, that if DuClaw knew of Left Hand, technically they should have carved out Left Hand’s trading territory from their application. This is a basis for cancellation of the mark, though this will probably all get sorted out as the court divvies up territories.)

One lingering question some may have is this: Given that DuClaw has had the TMs for more than a decade, Left Hand has been rapidly expanding during that time, and that when you Google “Sawtooth Beer,” for example, all sorts of Left Hand hits come up, why didn’t DuClaw act more quickly? The maybe unexpected answer is, DuClaw did act pretty quickly. Although there is a doctrine of trademark law out there called laches that requires TM owners to act with some expeditiousness, else sometimes forfeit their cause of action, that’s likely not what’s going on here. Instead, it seems DuClaw was relying on what’s one of the most frustrating principles of trademark law for TM owners, what’s known as the Dawn Donut Rule.

The oft-cited 1959 Dawn Donut case instructs that even if you own a trademark and have a superior right to use the mark in certain trading territories, you have a right to stop the other user, but no remedy in court until you actually cross trading territories with that user. You can issue a cease and desist, which might dissuade the other party from using the name (DuClaw issued one in 2010), but you can’t get any court to help you out and order them to stop using the name. As you can imagine, this can be really frustrating for those who wish to enforce their rights, especially when they know consumers are actually confused. Further, no brewery likely wants to prematurely expand just to enforce their rights…in a federal court in a state that’s far from their home turf. What makes it even more likely DuClaw has been waiting for Left Hand to expand into their home state of Maryland is that, Left Hand just started distributing into the state last month. From that perspective, DuClaw has waited no time at all to enforce its rights, now with a court-ordered remedy finally available.

It’s an interesting dispute, especially given the longevity of the dual uses and—at least for this writer—the secondary meaning of Sawtooth and the Black Jack portion of Black Jack Porter, currently tied to Left Hand and not DuClaw. Maybe DuClaw has no plans to expand outside of the East Coast, so the parties can come to some sort of an agreement. Maybe not. Still, there’s no doubt that had Left Hand registered its two names when it first started using them, back in the early 1990s, they wouldn’t be in court today, at risk of losing rights to their first-ever brew name, in much of the United States. As always, we’ll keep you posted about how the dispute progresses.

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