Big Sky Provides Its Two Cents on Trademark Dispute

By now you’re sure to have read about Big Sky Brewing Co.’s lawsuit against Anheuser-Busch InBev, the global conglomerate responsible for Budweiser, Stella Artois, and Becks, to name a few.  The news has circled the beer world and has also been carried in such non-beer related publications like the Huffington Post

In short, Missoula Montana-based Big Sky obtained a federal trademark for the slogan “hold my beer and watch this” in 2009, asserting their first use in commerce was in 2004.  This past November, AB InBev released three humorous Bud Light online videos showing what might happen when someone utters the phrase “hold my beer and watch this.”  Big Sky claims the videos violate its trademark and asked AB InBev to stop using it.  When AB InBev refused, Big Sky filed suit in Montana Federal District Court.

According to the news article linked above, Rob McCarthy, AB InBev’s vice president of Bud Light marketing is quoted as stating, “[t]here is no trademark use of the phrase ‘Hold my beer and watch this,’ nor is there intent to create any association with Big Sky. Countless other videos and jokes use the same or similar words as a punch line or hashtag.”

Largely declining comments in follow-up news stories, yesterday Big Sky released it’s two cents (their words) on the trademark issue.  Equating trademarks to the orange paint on Montana fence posts, the state’s ubiquitous symbol for “no trespassing,” Big Sky says the “hold my beer” phrase was clearly marked and AB InBev should have known to keep out.

It’s a good analogy and a far better response than that provided by West 6th Brewing Co. in its highly publicized trademark battle with Magic Hat.  Given the dramatic rise in the number of breweries in the U.S., news of trademark issues has become common place with the David v. Goliath – or vice versa – storyline becoming a boring, misplaced and frankly lazy rallying call.

Big Sky also doles out a bit of preventive medicine, acknowledging its own unintentional trademark transgressions over the years and its efforts to correct them. With new breweries popping up each week and seemingly thousands of new beers created on a monthly basis, it is not hard to believe most infringements are entirely unintentional.  They’re still violations, though and the orange paint does appear to shine rather brightly on this one.

A trademark is any word, name, symbol, or device used in commerce to identify and distinguish goods, including a unique product, from those manufactured or sold by others and to indicate the source of the goods. Think “Apple” in the context of electronics. You immediately know what it is.

Trademarks that are completely made up words and symbols and/or those which lack an association to the actual product get higher protection.  Again, think “Apple.”  The word has no association to electronics other than someone deciding that would be a good name for the company.  “Kleenex” is another good example. Conversely, trademarks that are more descriptive or generic in nature are given less protection.

A variety of commenters on twitter, facebook and the like have mildly chastised Big Sky for trying to trademark a phrase that is commonly used by beer drinkers.  However, it is entirely possible to trademark names and symbols that might be mainstream in one context, but not in another. 

Context matters.  A local Missoula business caught some flak a few years ago for allegedly trying to trademark the 406 area code. In reality, they sought trademark protection for the design “[406]” on clothing in order to protect their idea and design from being directly copied by anyone else.

How many of you are “movie buffs?” Very common phrase, right? Still, it’s a protectable phrase in context – that context being use of the phrase in a website by competing movie information providers. The Ninth Circuit Court of Appeals said so in 1999 (i.e. back when they still had to explain the significance of the internet). 

“Growler Fills” is a federally registered trademark as it applies to online journals about beer. Such trademark status/protection does not extend to what you call the act of getting your growler filled at your favorite brewery. Missoula’s breweries can advertise “growler fills” all they want without violating the trademark.  They cannot, however, start an online site about beer and call it Growler Fills. Context matters.

Credit: Complaint filed in Fed. Dist. Ct.

Big Sky did not trademark the slogan to keep you from uttering it to your friends when you’re about to do something . . . . . dramatic, shall we say.  They sought trademark protection for Big Sky’s particular use of the slogan as a marketing tool for their beer and related products. 

According to their complaint, Big Sky uses the slogan in a variety of ways.  It appears on their events trailer, glassware, growlers, clothing, coaster, posters, cozies and beer cans.  The slogan appears on each Big Sky IPA sold in all twenty four states of its distribution. In this way, Big Sky has sought to associate the slogan with its beer such that when you hear it, you think Big Sky beer.  

But hold onto your beer and listen to this.  Obtaining a federal trademark is not a guarantee the trademark is valid.  It creates a presumption of validity and various other rights and benefits, but no automatic stamp that it is valid against all claims.  Similarly, the lack of registration does not mean you’re entitled to use someone else’s distinctive mark.

Trademarks can also be lost. As mentioned in nearly every trademark news story on the “big boys” picking on the “little guys,” trademark owners have an affirmative duty to protect their marks and stop others from using them.  Failing to do so may allow the trademark to become so commonly used as to become generic and no longer entitled to protection.  Aspirin is one such example.

In general, when presented with a trademark infringement claim courts consider the “likelihood of confusion” between the competing parties – that is, whether a defendant’s use of a trademark is likely to cause a consumer to be confused about the source of those goods.  Factors to be considered in this analysis are (1) strength of marks; (2) relatedness of goods; (3) similarity of marks; (4) evidence of actual confusion; (5) marketing channels; (6) degree of consumer care; (7) defendants’ intent; and (8) likelihood of expansion. 

So how does it all shake out here?  The point of my post is not to make predictions, but here are some things to think about.**  Is there any question AB In-Bev used the exact same slogan for the same purpose as Big Sky?  Thus, the “goods” involved are the same – beer – and the “similarity of the marks” is not in question – they are exactly the same. 

Big Sky has obviously worked hard to try and associate its products with the slogan, but one might legitimately question whether a reasonably prudent consumer actually associates the slogan with Big Sky beer.  Conversely, those “countless other videos and jokes” McCarthy references aren’t trying to advertise or promote a specific product.

When a global company hires a prominent actor to use the slogan in humorous videos – videos which now have over 4 million views – what do you think AB InBev was attempting to do?  Certainly associate the slogan with Bud Light, thus immediately making Big Sky’s efforts to associate the slogan with its products significantly harder.

Expect AB InBev to immediately argue the slogan is not entitled to trademark protection given its relative common use among beer drinkers.  In other words, AB InBev will argue the trademark is not very strong and therefore not entitled to much protection, if any at all. That’s essentially what AB InBev’s McCarthy has already said. Whether AB InBev’s use of the phrase plausibly causes any consumer confusion between Bud Light and Big Sky’s beer is also certain to be a big part of their defense. 

Big Sky filed its complaint on December 20 and requested a jury trial.  AB InBev’s answer to the complaint is due to be filed mid-January. I’m sure we’ll all learn more about orange paint in the process.
* A defendant’s intent is one of the eight factors for trademark infringement, but courts have all but rendered the factor inconsequential.  An absence of malice is absolutely not a defense to a trademark violation.
 ** Nothing in this post should be considered legal advice.  The post presents general information for educational purposes.  There is far more to the legal analysis you’d want to know before using it as advice.