On the Social Effects of Lawsuits

Last year, Magic Hat sued West Sixth Brewing in federal court over a logo that bore a very mild resemblance to the Magic Hat #9 logo (inverted) and made use of the navigational compass star design that Magic Hat construed as a variation on what it calls its "dingbat" visible on the neck label between the words "Magic" and "Hat".

Ultimately, the suit was settled by West Sixth changing its logo to remove the dingbat and enlarge the name of the brewery and location. 

I'm torn on these kinds of David/Goliath lawsuits. In times dominated by social media, the major manufacturer certainly loses face doing something like this -- it looks like bullying, even if it's just trademark enforcement -- while the smaller business can use the very platform of a lawsuit to gain market. This is in contrast to lawsuits between two smaller companies, where winning in court might be a life-or-death issue, or between giants, where winning court is worth millions or tens of millions of dollars. Rather, a win by the larger party in these disputes seems to be strictly legal, with few redeeming features.

Trademark law is a vast and complicated web, though, and protecting one's mark is important in establishing that a business cares about that mark. Not protecting in marginal cases makes it open to incursion in less marginal cases. Given that a brewery like Magic Hat has made a national name and is defending brew sales that are, as they say, nothing to sneeze at, these kinds of lawsuits have to be looked at in an extended context. They clearly have to defend when Maze Brewing Company comes out with a maze logo that is identical to #9 but replaces "#9" but "MB". Or Magic Wand Brewery tweaks the font from the Magic Hat corporate logo, replaces the word "Hat" with "Wand", and puts a wand in place of the dingbat. These are no longer marginal: they're clear trademark violations.

Where I think some of the majors fail is in dialing up a lawsuit. In this instance, West Sixth offered a variety of alternatives prior to the lawsuit being filed, in response to a cease-and-desist letter; Magic Hat moved forward anyway, in a move that anyone with modest social media experience would consider daft.

There have been a lot of disputes like this lately as the number of small breweries in the United States explodes. Most of them are resolved amicably and quietly, without official lawsuits being filed but with plenty of legal letters whizzing back and forth. And most don't make the news because events like Stone Brewing Co. (distributed nationally) getting a name change out of Colorado's Kettle and Stone Brewing (now Vindication Brewing) make sense immediately. Plus companies like Stone know that perception matters: they offered several solutions that were vastly different, all of which were reasonable and would protect the Stone trademark.

Unfortunately the scope of some of these disputes is difficult to defend. For instance, Long Trail's lawsuit against Bent Paddle over hiker silhouettes (Long Trail's is at right, Bent Paddle's is below), while potentially with merit, seems to be a lower-level rehash of Magic Hat vs West Sixth -- admittedly looking more like Goliath's smaller cousin against Vontae Davis: the suit looks to have a certain amount of base mean-spiritedness and only marginal merit. It also seems like something that could have been resolved without a lawsuit that just makes Long Trail seem petty.

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What the burgeoning craft beer industry seems to need are two critical things:

1. An organization that tracks trademarks to keep upstart companies from taking on names and logos that are infringements on existing marks.

2. A consulting group that has some trademark law experience  but also understands social media. 

I appreciate the variety of beers available these days, and the marketplace can clearly accommodate more. I would hate to see that variety squelched by larger companies turning into elder polar bears roaming about and eating all the young. We want more Collaboration Not Litigation and Black Cascade. The beer world is big enough. 

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