Alamo Trademark Dispute Update: Texian Files Reply, Claims Innocent Infringement

In the fiery Alamo trademark dispute we’ve been reporting on, defendant Texian Brewing Co. (captioned in the case as Old 300 Brewing LLC) has filed its answer to Alamo Beer’s complaint. For those not yet familiar with this one, you can review detailed coverage of this case’s history here, here, and here—but, generally, this case concerns use of “Alamo” in conjunction with beer products, including use of the Alamo’s silhouette, in addition to certain imagery that Alamo Beer contends identifies its brand.

There is nothing too surprising in the answer, with Texian denying the bulk of the allegations and raising a slew of affirmative defenses to protect itself at this early stage of litigation. One maneuver, however, is worth noting, in that it could be misleading as a “Safe Harbor” for any breweries carefully reviewing this case.

Texian argues that Alamo’s claims “are barred, in whole or in part, because Defendant is, at best, an innocent violator within the meaning of 15 U.S.C. § 1117(a)(3) with regard to the matter in question.” Again, we flag this because it’s a bit misleading. Although it is true that the Lanham Act recognizes some limitations on remedies for an innocent infringer (it’s actually not in 1117, it’s in 1114 aka §32), Texian’s actions do not appear to be the kind of activity the Lanham Act insulates.

The statute limits violators “engaged solely in the business of printing the mark or violating matter for others” and creates other remedy relief for those engaged in publishing or distributing the mark, for example printing a magazine that contains ads that are found to be infringing. Taking Alamo Beer’s allegations as true, Texian isn’t engaged in these sort of innocent reprinting uses, but is engaged in source-identifying activity for its own benefit that Alamo Beer contends infringes its mark. The bottom line is, even if Texian didn’t know of Alamo or adopted all of its uses in good faith thinking they wouldn’t cause confusion, Trademark Law doesn’t “bar” Alamo’s claims against Texian. This is so because the touchstone inquiry of trademark law is whether consumers are likely to be confused, irrespective of whether the defendant thinks they are. (“Even though a guilty state of mind is relevant evidence of trademark infringement, an innocent state of mind is irrelevant on the issue of likelihood of confusion since the lack of intent to deceive does nothing to alleviate the confusion precipitated by the similarity of the trademarks,” Playboy Enter., Inc. v. Frena, 839 F.Supp. 1552, 1561 (1993).)

At any rate, we can’t blame Texian for putting everything conceivable out there at this point, which, in addition to claims of fair use and a challenge to the validity of Alamo Beer’s trademarks, also includes assertions of “unclean hands, misuse, acquiescence, genericness, abandonment and estoppel.” We’ll continue reporting on this matter.

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State of Texas Replies in Support of Its Motion to Intervene in Alamo Beer Brewery Trademark Dispute

The Alamo
The current trademark dispute involves rights to use “Alamo” as a trademark, including the silhouette of the historic building.




Texas is insistent about wanting to be in the Alamo Beer v. Texian trademark lawsuit going down in the Western District of Texas, San Antonio right now. As we’ve been reporting, the pendent dispute involves rights to use the mark on beer, and Texas believes it has superior rights to both the plaintiff and the defendant in the lawsuit.

Alamo Beer responded to Texas’s motion to intervene as we reported here, and this past Friday, May 9, 2014, Texas filed a reply. As we expected, Texas chides Alamo Beer for arguing the merits of the case, reminding Alamo Beer of the court’s posture in deciding a motion to intervene. Although Texas insists intervention as of right is appropriate here, we are not persuaded. Indeed, the weakest part in Texas’s argument also receives the least amount of treatment in Texas’s brief. That is, intervention of right is only appropriate if disposition of the current matter between Alamo Beer and Texian would impair Texas’s ability to protect its interests. We don’t necessarily think it does. Inclinations aside, Texas cites no case law for the proposition that a trademark owner should be afforded intervention as of right in a trademark dispute involving the same or a confusingly similar mark, or one that is dilutive of its famous mark. Texas cites back only to its brief and proposed complaint, observing that: “As Applicant’s Motion and Complaint make clear, should the court determine that either party has enforceable rights in marks depicting the Alamo, future attempts by Applicant to assert ownership of THE ALAMO Marks would be impaired.” Motion at 4.

Permissive intervention is another story, and if the court feels inclined to let Texas in, we think it has good grounds to do so. This is an interesting case, and we’ll let you know how this step in this increasingly-complicated brewery trademark lawsuit comes out.

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Update in Schlafly Brewery Trademark Dispute: Phyllis Schlafly Camp Moves to Amend TTAB Opposition

We’ve been reporting on the intrafamily trademark dispute that has Schlafly Beer embroiled in an opposition proceeding before the TTAB. This week, the opposers have moved to amend their complaint to add another ground for opposition. In addition to their first contention that the Schlafly mark is primarily a surname under Section 2(e), the opposers now wish to argue that the Schlafly mark suggests a false connection with Phyllis Schlafly under Section 2(a).

The TTAB has established a four-part test for whether marks suggest a false connection: (1) the mark is the same as, or a close approximation of, the name or identity previously used by another person or institution; (2) the mark would be recognized as such, in that it points uniquely and unmistakably to that person or institution; (3) the person or institution named by the mark is not connected with the activities performed by the applicant under the mark; and (4) the fame or reputation of the person or institution is such that, when the mark is used with the applicant’s goods or services, a connection with the person or institution would be presumed.

We’ll note that the motion to amend the pleading was not, maybe, as straightforward as we would like to see regarding the second element, lopping off words that are less favorable to their argument: “the mark would be recognized as such” vs. the test enunciated by the TTAB, “the mark would be recognized as such, in that it points uniquely and unmistakably to that person or institution.” In re Jackson Int’l Trading Co., 103 U.S.P.Q.2d 1417, 1419 (TTAB 2012).

For the opposers, we think the primarily merely a surname is still the strongest ground for opposition due to, among others, serious doubts about whether Phyllis Schlafly rises to the level of fame that just “Schlafly” would unmistakably point back to her. Nevertheless, the spaghetti-on-the-wall approach in litigation is unsurprising, and we’ll be interested to see whether the TTAB allows amendment, given discovery is to close in under a month.

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Alamo Beer Company Fires Back in Response to State of Texas’s Motion to Intervene

Last week, we reported on the interesting development in the Alamo Beer Company v. Texian Brewing Co. brewery trademark dispute going down in the Lone Star State. For those out of the loop, the dispute concerns trademark rights to the Alamo mark and the Alamo’s silhouette in conjunction with beer products. The notable development was the State of Texas’s motion to intervene, asserting that the State is the one with superior rights to use the Alamo mark. Interesting stuff.

As predicted, Alamo Beer has fired back in its reply, filed Monday, May 6, 2014. Alamo Beer leans on its 17 years of use of the Alamo mark in commerce on beer products, trading primarily in none other than than San Antonio, where the historic Alamo resides and where Texas’s alleged superior use of the mark was occurring. In contesting whether Texas even has a cognizable right at stake, Alamo Beer asserts that confusion isn’t likely and addresses Texas’s dilution claims as well, contending that Texas failed to prove the Alamo mark is famous or otherwise worthy of the sort of protection trademark law was built to deal with: “Simply because the State owns the physical Alamo building does not mean the State has a monopolistic trademark for goods and services they do not provide under the Alamo Marks.” Brief at 6. Alamo Beer closes with what amounts to a laches argument, while chiding Texas for the adequacy of its motion (“The State waited 17 years and submitted a complaint without sufficient facts in reliance on self-serving conclusory statements.” Brief at 8). Importantly, Alamo Beer steps outside the merits of Texas’s potential claim and reminds the Court what the underlying dispute is about, contending that permitting intervention under the present facts would be inappropriate. Brief at 8–9. We agree with Alamo Beer that any sort of intervention as of right from the court would be inappropriate, but think there’s good reason for the district court to let Texas in under Permissive Intervention, Rule 24(b), if it decides it wants to handle the dispute that way. Let’s journey back to Civ Pro for a minute and try to sort this one out.

First, the claim as of right. The court would be required to allow Texas to intervene if a statute says it must (we can’t think of a statute that does) or if Texas is so situated with a property right that resolving the underlying action would impede Texas’s ability to protect its interest. See FRCP Rule 24(a). Texas thinks it can intervene as of right in its motion, but we don’t tend to agree. Whether Alamo Beer has superior rights to Texian’s doesn’t change Texas’s ability to successfully sue either company, saying Texas actually has superior rights to use the Alamo mark. Ultimately, the present dispute is about who wins between Alamo Beer and Texian based on their set of facts, not whether one or the other may ultimately lose to someone else. Even if Alamo Beer wins its case against Texian, it still may be vulnerable to a claim by someone else—and that would not be fun, but the outcome of that lawsuit down the line would not be in conflict with the outcome of this case. We don’t think this is the scenario that intervention as of right is intended to handle.

Turning to permissive intervention, Rule 24(b), the court can let Texas in if a statute says it can (we can’t think of a statute that does) or Texas’s claim or defense shares with the main action a common question of law or fact. If you conceive of the legal question generally (Who has superior rights to the Alamo mark?), we suppose you can get there. Better yet, Texas might also be able to get there by observing that in order to dispense with the Alamo/Texian dispute, the district court must examine factual questions about when either company first began taking up use and on what kinds of goods. These questions would arise again in any dispute between the State of Texas and the winner of the present dispute. Still, as Alamo Beer correctly points out, under 24(b)(3), the court can consider in its discretion whether permitting intervention would unduly prejudice or delay the adjudication of the original parties’ rights. Although Alamo Beer contends it would be prejudiced, we can see how it would not be unduly prejudicial or cause undue delay to bring in Texas, in that if Texas does have the superior rights, the original parties would have to face off against Texas eventually. Arguably, it’s more efficient for everyone this way, so the court can consider who did what, on which goods, and when, and then how those uses relate to a likelihood of confusion. Then again, maybe Texas’s 17 years of inaction during Alamo Beer’s continuing use in San Antonio constitutes enough prejudice for the court to let Alamo Beer have its way and, as it seems to prefer, to dispense with Texas in a separate case.

So, to wrap it all up, permissive intervention is a possibility here, but for the reasons stated in our earlier post, we’re not convinced Texas ultimately has a strong claim in the long run, both on its proffered potential confusion and dilution grounds. All in all, maybe this case isn’t the best use of the state’s tax dollars, but who are we to mess with Texas?

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New FTC Report Makes Marketing Recommendations to Alcoholic Beverage Industry

The Federal Trade Commission has recently released its fourth report on self-regulation in the alcohol industry. The report chiefly concerns initiatives to address underage exposure to alcohol marketing, and it’s worth a read to get a sense of FTC concerns about alcohol advertising in new and emerging media. Below are FTC’s key recommendations:

1. Brewers and the beverage industry should take full advantage of age-gating technologies built into websites such as YouTube and Twitter. Rather than have accounts broadcast marketing messages to the Web at large, best practice would be to use all tools available to ensure that only those accounts reporting 21+ are able to view the content.

2. FTC has recommended in the past that alcohol-related websites contain age-verification gates to limit underage access to the website. FTC remains concerned about underage access to Web marketing messages, but is also concerned about data privacy and data collection practices. To address underage-access concerns, FTC recommends requiring visitors to enter their full date of birth, instead of just clicking a button verifying the user is 21+. Addressing privacy concerns, FTC recommends that websites restrict these required information fields to only (1) date of birth and (2) country of residence.

3. In connection with privacy, FTC would like to see breweries and the beverage industry clearly enunciate data collection and privacy policies.

4. FTC would like to see more active monitoring of user-generated content to ensure violative content is being removed.

Click here to read the full report.

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