Stone Brewing beef froths with Miller Coors

Founder of Escondido-based Stone Brewing, Greg Koch, has a beef with Miller Coors over trademarks/Stone Brewing

Score one for true independent craft beer today as the #TrueStonevsKeystone lawsuit continues.  On Tuesday, March 26, a San Diego Federal Court judge issued its order regarding Stone’s preliminary injunction motion against one of the world’s largest beer conglomerates, MillerCoors.  It confirmed “Stone’s mark to be commercially strong and recognizable,” deserving of “strong protection.”

Miller Coors is infringing on the brewery’s trademark rights, according to Stone Brewing attorneys.

On February 12, 2018, Stone Brewing sued MillerCoors and others at federal court in San Diego for trademark infringement.  In essence, Stone Brewing owns the federal trademark for the word STONE in connection with beer, and alleges that in April of 2017, MillerCoors refreshed or rebranded its Keystone beer to emphasize the word STONE.  The founder of Stone Brewing, Greg Koch, announced the lawsuit on Youtube.

One of the keys of this case will turn on the concept of trademark priority, meaning who was the first to use the term STONE as a trademark, according to Scott Harper, partner at Harper, Bates & Champion in The Beer Connoisseur.

The court will look to see who used the term STONE first in connection with beer, and if such commercial use was continuous and sufficient so as to create consumer understanding of who is the source of STONE beer and distinguish it from other sources. U.S. trademark law is built upon this fundamental rule of “first in time, first in right” when it comes trademark ownership.

Stone claims it has consistently used STONE as its trademark since brewing its first STONE beer in 1996, while MillerCoors contends that “MillerCoors began using and obtained a federal trademark registration for KEYSTONE nearly a decade before Stone Brewing registered STONE” and that “MillerCoors use of STONE and STONES in advertising predates Stone Brewing’s use.”

Stone adds that its “award-winning distinctive hoppy and “bitter” beer has been sold for over twenty years under the incontestable STONE® federal trademark” and that MillerCoors rebranding and ongoing use of the mark STONE “is wreaking havoc in the market” and that a preliminary injunction “is necessary to halt this onslaught and protect one of California’s most prized craft beer brands from permanent injury.”

MillerCoors answered back with several counterclaims, asking the court to grant it the “exclusive” right to use the “Stone” mark in conjunction with U.S. beer sales.

In its 82-page retort, MillerCoors, a subsidiary of Molson Coors Brewing Company, called the claims in Stone Brewing’s February lawsuit “misleading and ultimately meritless” as well as a “publicity stunt and a platform to market its beer.”

“Stone Brewing’s complaint makes grandiose allegations, but leaves out most of the facts relevant to this dispute,” the filing alleges.

For the brewing industry, the implications of the fight between Stone Brewing Co. and MillerCoors over the STONE trademark showcases the importance of investing in the creation of a strong brand identity, being the first to use distinctive trademarks associated with one’s beverage goods and services and continuing to grow and strengthen your trademark rights by continuously promoting the trademarked goods and services to the consuming public.

What does this positive ruling mean for Stone and craft beer?

Miller Coors calls it Keystone Local, which Stone cals trademark infringement/Miller Coors

It means that MillerCoors’ Keystone cans are likely to confuse consumers, infringe on Stone’s trademark, and will likely be forced to undergo a rebrand after the case goes to trial.  In short, Stone is that much closer to protecting its good name, reputation and brand integrity.

Here’s some legal jargon to spice it up:

“The Court agrees [with Stone], especially considering the marks incontestability, STONE is entitled to the strong protection afforded to suggestive marks.  Since Stone and Miller both produce a beer which is distributed nationally, a consumer is likely to encounter both within close proximity of the other, making it is reasonable to consider Miller a direct competitor of Stone … Taking all the factors into account, the Court finds that Stone’s trademark infringement claim against Miller is moderately strong.”

While the Court did not order a preliminary injunction, it found that the issue was one for trial, where Stone looks forward to presenting evidence of the significant impact that MillerCoors’ campaign has had on the craft brewery – and the massive sales which Keystone has accumulated since reviving itself using Stone’s trademark.

“This is a very big deal,” stated Greg Koch, Stone Brewing executive chairman & co-founder. “The Court’s order confirms what we knew: that MillerCoors should be ashamed of what they have been doing. All along this has been a clear-cut infringement case, and now we can focus our resources on proving the significant damages done to the good name of Stone Brewing.”

Koch added: “To any believer in independent, craft beer, today is a good day. All we ask is that you keep #TrueStonevsKeystone on your mind, and true Stone in your fridge.”

Confused? San Diego Federal court will decide which is which/Escondido Grapevine

Stone CEO Dominic Engels said: “We are pleased that the Court recognized the validity of Stone’s infringement claims.  MillerCoors has made hundreds of millions of dollars from rebranding Keystone in a way that infringes on our trademark. It also has hurt Stone and our brand.

We look forward to presenting this evidence to the Court at trial.” Engels continued. “We entered this litigation to obtain “permanent protection against future misuse of our brand.  The Court’s ruling is a win for Stone and we look forward to presenting these issues to a jury in San Diego.”

Stone filed suit against MillerCoors in February 2018 after MillerCoors tried to rebrand its Colorado Rockies-themed “Keystone” beer as “STONE.”

Company officials said they had no choice but to combat MillerCoors’ aggressive marketing moves, which abandon Keystone’s own heritage by falsely associating with the one true STONE®.  Stone announced the bold move by video last year and continues to wave a flag of independence, vowing never to sell out to Big Beer.

Stone Brewing is represented in the lawsuit by Noah Hagey, Jeff Theodore and Toby Rowe of San Francisco litigation boutique BraunHagey & Borden LLP.

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