Brewery Law Blog | From Seattle, WA Beer Lawyers

Beer Law News & Legal Insight from the Brewery Attorneys at Reiser Legal.

New TTB Cider FAQ: TTB Clarifies Labeling and Other Regs for Cider Industry

Posted on | February 3, 2015 by | No Comments

TTB Cider FAQ: What Producers and Cider Start-ups Need to Know

New TTB Cider FAQ: What Producers and Cider Start-ups Need to Know, Straight from Uncle Sam.

There’s a new TTB Cider FAQ out. We’ve touched on Washington Cider Law in the past, but the feds play an important role in it too. Just today, TTB has provided helpful insight to the growing craft cider industry. Here’s a link to the new TTB Cider FAQ, with six bullet points from us below covering more notable stuff, especially for those comparing regs on the cider side with things on the beer side. Different worlds, but we help with both sides at Reiser Legal.

1. Cider is a wine, we know that. It’s not a malt beverage under the law.

2. From TTB’s labeling standpoint, to call a product just “cider” it has to come from fermented apples and optionally contain added sugar, water, or alcohol. Anything else, it’s not just “cider.” Fortunately, when you submit your formula, TTB will provide a suggested statement of composition to help you, and you can always designate a fanciful name on the label, so long as it’s not misleading.

3. If your cider contains less than 7% ABV, you do not need a COLA. This stems back from the TTB/FDA regulatory authority divide we’ve discussed in the past. If your cider is 7% to 24% ABV, you need that COLA to ship in interstate commerce, as you’re subject to TTB authority. Notably, Washington is going to want that COLA to get your project on the shelves here. Either way, even if you don’t need to obtain a COLA, if the cider leaves the premises, it still has to comply with certain basic labeling requirements.

4. Because cider is a wine, 7%+ ABV cider is subject to TTB’s standards of fill. That means 12oz packages (like the cans we know and love to see on the shelves) are no good for cider at that ABV. Below 7%, it’s all good. Notably also, as long as you’re shipping wine in containers above 18L (4.75G), you don’t have to comply with TTB’s standards of fill. Here are some standards of fill, which feel pretty arbitrary but it’s a reg so what do you expect:

  • 3 liters
  • 1.5 liters
  • 1 liter
  • 750 mL
  • 500 mL
  • 375 mL
  • 187 mL
  • 100 mL
  • 50 mL (just a sip at 1.6907!)

5. If you’re only making cider below 7% ABV, you don’t need a basic TTB permit. Keep in mind, you’re still subject to applicable federal authority, and your local liquor board (in Washington, the Liquor Control Board) more than likely has its own sets of permitting requirements and onerous regs.

6. If your cider has CO2 in it (technically about .392g CO2/100mL, be careful. If CO2 is coming from secondary fermentation in a closed vessel (like a bottle), it’s considered “sparkling.” But, if you’re injecting CO2, it’s artificially carbonated so it has to be labeled as such. Note that sparkling/carbonated wines are taxed at higher rates. Speaking of tax, there are all kinds of nuances with respect to how you’d be going about your cider business.

The takeaway on the TTB Cider FAQ:

Regulations are really confusing, inconsistent among industries, and you might be subject to a completely different set of regulations depending on how much alcohol is in your project. For anyone thinking about starting a cidery in Washington State, we’re happy to help you wade through these tricky regulations. We’ll post further resources for cideries on the blog soon.

 

Danielle Teagarden on twitterDanielle Teagarden on linkedinDanielle Teagarden on email2
Danielle Teagarden
Brewery Attorney at Reiser Legal PLLC
Danielle Teagarden is a Seattle-based brewery lawyer, business attorney, and intellectual property advisor with particular focus on protecting trademark rights and handling trademark disputes. Danielle frequently represents craft breweries, start-ups, and small alcoholic beverage businesses, and she is Author and Editor of the Brewery Law Blog. You may reach her directly at danielle@reiserlegal.com

Comments

Craft Beer Musings from Seattle: On Elysian, that Budweiser Super Bowl Ad, and our Dear Seahawks

Posted on | February 3, 2015 by | No Comments

Corporate Beer Still Sucks—but with the Elysian buyout, not nearly as bad.

Corporate Beer Still Sucks—but with the Elysian buyout, not nearly as bad.

So, I’m a Seattle-based craft brewery attorney. Between the announcement that Anheuser-Busch InBev purchased Seattle-based Elysian Brewing Company last week, that now-infamous Budweiser Super Bowl commercial poking fun at craft beer, and then that bummer of a Seahawks loss, it’s all felt a little personal lately. So, here I am with some thoughts and observations about it all. I know all three of these recent events blew up and made the headlines, spawning endless clever Twitter posts, Reddit memes, and thoughtful articles across the Interwebs from people paid to do this stuff, with more time to pore over it all than I do. So, if I’m rehashing the hash, come check out the Brewery Law Blog next time. For the rest of you, let’s dig in a bit.

Here’s what we know, and then some reflections, about recent headlines.

WHAT WE KNOW about the Elysian purchase, that Budweiser Super Bowl ad, and those Seahawks:

1. Last week, Anheuser-Busch InBev’s purchase of Seattle-based brewery Elysian Brewing Company was made public knowledge.

2. The lone dissenter from Elysian in the purchase was owner Dick Cantwell, a champion of the craft brewing scene and, at least until now, very active with the Brewers Association.

3. Elysian, under the influence of Dick Cantwell, has produced a number of impressive and locally loved beers. Among the brews have been extremely creative pumpkin beers each fall. In fact, Elysian has been holding the Great Pumpkin Beer Fest for the last decade. Cantwell was featured in an American Homebrewers Association article giving tips on brewing with pumpkin beer. Man knows his pumpkin stuff.

4. As I found out this past fall over a taproom pour, Dick Cantwell gave fellow Seattle brewery Schooner Exact a hard time because Head Brewer Matt McClung hadn’t produced a pumpkin beer. In response to the heckling, Schooner crafted a batch of barrel-aged pumpkin goodness and named it “Whiskey Dick Cantwell” in a tongue-in-cheek nod to Cantwell.

5. Lots of people in the Seattle area and beyond were upset to hear about A-B’s purchase of Elysian. Fun fact, as you’ve probably read about so far—Elysian teamed up with Seattle’s indie record label Sub Pop to produce a beer with the tag line “Corporate Beer Still Sucks.” What you may not know, and I only put together anecdotally, is that the Sub Pop deal and that beer are probably dead because of it all. No surprise there, but it still makes for a fun story to relate in the wake of all this: At the Washington Beer Commission’s awesome Belgianfest in Seattle on Saturday, someone in my tasting group happened to be wearing a Sub Pop sweatshirt, and an Elysian pourer made a bummed comment about Sub Pop dropping them. Whatever’s underneath that comment, and whatever happened with Sub Pop, people are upset. People on seemingly both sides, even. They’re talking. We know that.

6. During the exorbitantly expensive advertising slots during the Super Bowl, Budweiser ran this ad. It attempted to frame Budweiser as proudly a “Macro” brand while poking fun at Microbrews.

7. In the commercial, Budweiser specifically made fun of the creativity and unusual ingredients in craft beers…making fun of a hypothetical “Pumpkin Peach” ale. The line, so you have it, was this: “Let them sip their pumpkin peach ale, we’ll be brewing us some golden suds.”

8. Sadly, the ad team didn’t do their research (or did?) because, as everyone on the Internet and I quickly Googled during the bowl and confirmed what we suspected. Yep, Elysian had produced a Pumpkin Peach ale, just this year, called Gourdgia On My Mind. (As you’d guess, Cantwell isn’t too happy about snarky tone of the ad.)

9. Wow.

10. The Seahawks lost.

REFLECTIONS from this Seattle Beer Lawyer, who feels a little extra connection, if only emotional, to all the goings-on:

1. Succession Planning. I really wasn’t too bugged about the Elysian purchase. If anything, it highlights the need for breweries-in-planning and those seeing some early success to think about the future. What’s your end game? Do you want to sell, if you can? Selling doesn’t necessarily mean selling out, either.

2. Breweries are Amazing Marketers. Okay, CRAFT breweries are amazing marketers. I can’t think of another industry where consumers get this riled up over David and Goliath, can you? Example. If a local artist stopped selling their screen-printed made-in-the-USA t-shirts and sold their designs to Target, we’d probably be happy for the local artist. It wouldn’t make headlines, at least not like this. If we cared that much about purely local t-shirts, we’d go find another one. On the other hand, craft breweries have created a tremendous sense of “us” against a very giant “them.” We’ve pulled this off, even despite a technical definition that makes many “craft” breweries quite huge. Extremely huge. Rapidly expanding nationally and internationally huge. Nevertheless, it seems to me that very few beer geeks and “craft” aficionados apply this same craft mentality to all aspects of life. I’m wearing Adidas sneakers and some Levis as I type this out. Maybe some little guys in other industries have something to learn from breweries as well as the nice work farmers markets and eateries have done with this whole “go local” push. Maybe food/drink, because they’re closer to each of us, are likewise easier to feel passionately about. Whatever the case, it’s interesting.

3. Budweiser is clearly aware of its loss of marketshare to craft brands. Of course, we all knew that already, what with all the layoffs. And the statistics.

4. Budweiser’s commercial may have worked. Yep. Maybe it was genius, apart from the whole Elysian gaffe. After all, anyone who was bugged by the commercial or took the time to write about it, present company included, isn’t buying Bud. Budweiser simply pointed to the divide that all of us beer geeks are already well aware of. If you were a loyal Bud drinker, or skeptical of craft beer, maybe this would actually stick you firmly on the other side, and arm you with some tools to make fun of the movement. For the rest of us, let’s get real. If you reacted to the commercial, or went to Twitter during the Super Bowl, the last time you probably had a Bud was in your old college bar or when your uncle pulled one from the fridge and it was Bud or no beer at that family gathering. (In that case, I’d choose Bud, every time. And that’s okay.)

5. Craft breweries need to keep up the marketing. It’s not time to pull off the gas pedal. As big guys snap up some great brands, a number of those brands will remain successful as they head into different marketplaces. But, maybe that’s a good thing. For me, it was the omnipresent and ad-dollars-fueled Blue Moon that opened my mind to Indiana University’s local Upland Wheat. I remember visiting the MillerCoors plant in Golden, CO in seventh grade, and my dad bought a Blue Moon t-shirt. It felt incredibly hip compared to Bud. Remember when MillerCoors was the little guy, when Leinenkugel was a good option out of not many? It was also stuff like Killian’s that helped a lot of people find Fat Tire and, from Fat Tire…beyond. I’m all for better beer out there, and craft breweries will just have to keep promoting their awesomeness, so as tastebuds evolve, beer-geeks-in-training find them eventually. For those of us who have already converted, there’s no turning back.

6. The Seahawks’ decision to pass wasn’t as bad as I thought at first. My brother helped me feel better about it, by pointing out the absurd statistics that favored passing instead of giving the ball to Beast Mode and running it on in. It still didn’t make it hurt much less. But, maybe this whole Anheuser-Busch buyout direction and their both-sides-of-mouth approach really isn’t the worst thing in the world either. Still, I felt the zing, too.

Whatever the case and whatever happens with the above, I propose a toast:

To craft beer fans everywhere, and on behalf of the would-be craft beer lovers out there that still represent A-B’s dominant share of the market—let’s keep rising up. Because, however you feel about recent events, I know I sure am glad everyone’s talking. What a good sign for craft beer.
Danielle Teagarden on twitterDanielle Teagarden on linkedinDanielle Teagarden on email2
Danielle Teagarden
Brewery Attorney at Reiser Legal PLLC
Danielle Teagarden is a Seattle-based brewery lawyer, business attorney, and intellectual property advisor with particular focus on protecting trademark rights and handling trademark disputes. Danielle frequently represents craft breweries, start-ups, and small alcoholic beverage businesses, and she is Author and Editor of the Brewery Law Blog. You may reach her directly at danielle@reiserlegal.com

Comments

Lagunitas to Sierra Nevada: Let’s Call the Whole Thing Off

Posted on | January 14, 2015 by | 2 Comments

Edit 1/14/2015 at 2:06pm PST: Indeed, Lagunitas dismissed the lawsuit. Thanks to Twitter for breaking the news and the screen cap. As this fellow beer attorney points out and helpfully includes the filing, it’s dismissed in a way that Lagunitas could sue again, but I think we know what kind of uproar that would cause. That said, if anything was ever going to associate those two marks in consumer’s minds, certainly now this lawsuit will!

  See our coverage yesterday on the Lagunitas – Sierra Nevada lawsuit, directing you to the public’s overwhelming reaction in favor of Sierra Nevada. Lagunitas owner Tony Magee, via the tweets below, called yesterday the “worst day ever” in the brewery’s history and vowed to drop the lawsuit this morning. We’ll report back if that’s the case. Some Twitter followers are asking Tony Magee to apologize. Indeed, this particular dispute-that-was may well beat out the Magic Hat / West Sixth catastrophe. Turns out the increasingly trademark-savvy public is quick to defend even the big guys, too.

Danielle Teagarden on twitterDanielle Teagarden on linkedinDanielle Teagarden on email2
Danielle Teagarden
Brewery Attorney at Reiser Legal PLLC
Danielle Teagarden is a Seattle-based brewery lawyer, business attorney, and intellectual property advisor with particular focus on protecting trademark rights and handling trademark disputes. Danielle frequently represents craft breweries, start-ups, and small alcoholic beverage businesses, and she is Author and Editor of the Brewery Law Blog. You may reach her directly at danielle@reiserlegal.com

Comments

Lagunitas vs Sierra Nevada: Be the Jury

Posted on | January 13, 2015 by | 4 Comments

Edit: Once the Lagunitas vs. Sierra Nevada story broke, public opinion convinced Lagunitas owner Tony Magee to call the whole thing off. See his tweets below, noting how sometimes there’s the court of law and other times the court of public opinion. Again, the consumer discussion thread pointed to below gives you insight into how the public reacted to this one. This particular dispute-that-was may well beat out the Magic Hat / West Sixth catastrophe. Turns out the increasingly trademark-savvy public is quick to defend even the big guys, too.

 


Original Story: I’m sitting out on really dissecting the Lagunitas vs Sierra Nevada trademark lawsuit involving the IPA packaging/lettering here (it’s 3:15-cv-00153, filed by Lagunitas on Jan. 12, 2015). There’s a lot of really wonderful attorney coverage and also consumer-reaction coverage out there. No doubt, you’ve likely already come across it and developed some opinions of your own. If you haven’t, I recommend starting here for some good links and balanced perspective on the pending brewery trademark lawsuit, including the original Lagunitas complaint.

As you start with your instincts and keep thinking about the issues, what I will do is provide some basic resources for curious onlookers trying to figure out what’s at stake here—and how this sort of thing would really be analyzed in court. If this thing even gets that far.

First, for fun—as an example of how some consumers are feeling—you can check out this coverage with consumer discussion bubbling up in the comments.

Next, the meat. Here are factors that a judge could ask a real jury to consider in determining whether there’s any sort of trademark infringement going on here. (I’m pasting in model jury instructions from the 9th Circuit website, within which the California federal court involved is located). Boiling it down a bit, the ultimate question (if this eventually gets to a jury) would essentially be, does Sierra Nevada’s use of the trademark(s) make it likely that an ordinary consumer would be confused, believing that Sierra Nevada’s goods originated from, were sponsored by, or affiliated with Lagunitas? These factors below help the jury make that determination.

Judge to Jury Instructions Used in Cases Like the Lagunitas vs Sierra Nevada Brewery Trademark Lawsuit

This Lagunitas v. Sierra Nevada lawsuit is happening. Read the gist of the potential jury instructions. What do you think?

This Lagunitas v. Sierra Nevada lawsuit is happening. Read the gist of the potential jury instructions. What do you think?

We don’t have all the evidence, but we do have this picture to start the conversation. Here are sample instructions a judge might give a jury in a case like this—what do you think?

“You must consider whether the defendant’s use of the trademark is likely to cause confusion about the source of the plaintiff’s or the defendant’s goods.

I will suggest some factors you should consider in deciding this. The presence or absence of any particular factor that I suggest should not necessarily resolve whether there was a likelihood of confusion, because you must consider all relevant evidence in determining this. As you consider the likelihood of confusion you should examine the following:

1. Strength or Weakness of the Plaintiff’s Mark. The more the consuming public recognizes the plaintiff’s trademark as an indication of origin of the plaintiff’s goods, the more likely it is that consumers would be confused about the source of the defendant’s goods if the defendant uses a similar mark.

2. Defendant’s Use of the Mark. If the defendant and plaintiff use their trademarks on the same, related, or complementary kinds of goods there may be a greater likelihood of confusion about the source of the goods than otherwise.

3. Similarity of Plaintiff’s and Defendant’s Marks. If the overall impression created by the plaintiff’s trademark in the marketplace is similar to that created by the defendant’s trademark in [appearance] [sound] [or] [meaning], there is a greater chance [that consumers are likely to be confused by defendant’s use of a mark] [of likelihood of confusion]. [Similarities in appearance, sound or meaning weigh more heavily than differences in finding the marks are similar].

4. Actual Confusion. If use by the defendant of the plaintiff’s trademark has led to instances of actual confusion, this strongly suggests a likelihood of confusion. However actual confusion is not required for a finding of likelihood of confusion. Even if actual confusion did not occur, the defendant’s use of the trademark may still be likely to cause confusion. As you consider whether the trademark used by the defendant creates for consumers a likelihood of confusion with the plaintiff’s trademark, you should weigh any instances of actual confusion against the opportunities for such confusion. If the instances of actual confusion have been relatively frequent, you may find that there has been substantial actual confusion. If, by contrast, there is a very large volume of sales, but only a few isolated instances of actual confusion you may find that there has not been substantial actual confusion.

5. Defendant’s Intent. Knowing use by defendant of the plaintiff’s trademark to identify similar goods may strongly show an intent to derive benefit from the reputation of the plaintiff’s mark, suggesting an intent to cause a likelihood of confusion. On the other hand, even in the absence of proof that the defendant acted knowingly, the use of plaintiff’s trademark to identify similar goods may indicate a likelihood of confusion.

6. Marketing/Advertising Channels. If the plaintiff’s and defendant’s [goods] [services] are likely to be sold in the same or similar stores or outlets, or advertised in similar media, this may increase the likelihood of confusion.

7. Consumer’s Degree of Care. The more sophisticated the potential buyers of the goods or the more costly the goods, the more careful and discriminating the reasonably prudent purchaser exercising ordinary caution may be. They may be less likely to be confused by similarities in the plaintiff’s and defendant’s trademarks.

8. Product Line Expansion. When the parties’ products differ, you may consider how likely the plaintiff is to begin selling the products for which the defendant is using the plaintiff’s trademark. If there is a strong possibility of expanding into the other party’s market, there is a greater likelihood of confusion.

[9. Other Factors. Any other factors that bear on likelihood of confusion.]”


Now that you know what you know, what do you think about the Lagunitas vs. Sierra Nevada trademark lawsuit?

Danielle Teagarden on twitterDanielle Teagarden on linkedinDanielle Teagarden on email2
Danielle Teagarden
Brewery Attorney at Reiser Legal PLLC
Danielle Teagarden is a Seattle-based brewery lawyer, business attorney, and intellectual property advisor with particular focus on protecting trademark rights and handling trademark disputes. Danielle frequently represents craft breweries, start-ups, and small alcoholic beverage businesses, and she is Author and Editor of the Brewery Law Blog. You may reach her directly at danielle@reiserlegal.com

Comments

Brewery Start-up Series #7: When to Sign a Brewery Lease

Posted on | January 12, 2015 by | No Comments

It may seem out of order, but a brewery needs to find a place to do its commercial brewing and get a lease in place before it gets licensed to commercially brew beer.

It may seem out of order, but a brewery needs to find a place to do its commercial brewing and get a lease in place before it gets licensed to commercially brew beer.

When you’re thinking about starting a brewery, it’s easy to feel daunted by the cost of it all. As we’ve covered elsewhere, there are strategies to get around those brewery start-up costs—and oftentimes funds are out there. (See all of our Brewery Start-up Series here.) Still, no matter how you fund the brewery, a significant business expense is the commercial lease. Understandably, brewery start-ups are reluctant to sign a lease and obligate themselves to rent payments too early in the process. For those considering opening a brewery, however, it’s important to note that in order to get a license to commercially brew beer, a brewery needs a premise. The premise, along with the start-up team, is what is licensed.

Commercial Brewery Lease and Opening Timeline

In other words, the brewery’s lease comes before the licensing application. (You can check out our general Brewery Opening Timeline here.) This is the case for the federal brewery license through TTB, which you apply for through a Brewer’s Notice and filing other information about the business owners. This is also the case for states such as Washington, seeking a Washington brewery license through LCB (Liquor Control Board).

This brewery-opening timeline is important to keep in mind, as it informs a start-up brewery’s budget and brewery business plan. However, there may be creative ways to alleviate some of this pressure. For example, a brewery may be able to negotiate reduced rent with its landlord for those first months, while waiting for licenses to come through. Or, to at least give the start-up team peace of mind, the brewery’s long-term obligation to pay on the lease may be made contingent on the start-up’s ability to obtain proper licensure.

Ultimately, when putting together a brewery business plan, it’s wise to be thinking about location early in the process. Not only does licensing depend on it, but the location itself, proximity to other breweries, parking configuration, access to foot traffic, and the like, can all play important roles in how successful a particular business plan will be.


Next Brewery Start-up Series:

In our next segment of the Brewery Start-up Series, we’ll discuss common premise-licensing issues and important things to consider when reviewing a potential premise or lease.

Danielle Teagarden on twitterDanielle Teagarden on linkedinDanielle Teagarden on email2
Danielle Teagarden
Brewery Attorney at Reiser Legal PLLC
Danielle Teagarden is a Seattle-based brewery lawyer, business attorney, and intellectual property advisor with particular focus on protecting trademark rights and handling trademark disputes. Danielle frequently represents craft breweries, start-ups, and small alcoholic beverage businesses, and she is Author and Editor of the Brewery Law Blog. You may reach her directly at danielle@reiserlegal.com

Comments

« go backkeep looking »
  •   Subscribe To Our Feed Subscribe to our RSS Feed to read the Brewery Law Blog!