Over the past several years, the question of what’s a “craft beer” and who qualifies to make a craft beer has been a front and center issue among the brewing community. It started when “Macro Brewers” began making “small” batch brews such as “Blue Moon” manufactured and sold by the “Blue Moon Brewing Company,” a subsidiary of the MillerCoors brewing behemoth, the second largest brewing company in the world. What’s wrong with that?
Apparently, nothing according to the latest court decision on the issue. In Evan Parent v. MillerCoors LLC, the plaintiff, Evan Parent, filed a class action suit against MillerCoors alleging that it deceived MillerCoors customers by marketing Blue Moon as a craft beer when it is not. Here are Parent’s major contentions:
- Blue Moon does not qualify as a “craft beer” as defined by the Brewers Association, which must (a) produce less than 6 million barrels of beer annually; (b) be less than 25% owned or controlled by a non-craft brewer; and (c) make beer using only traditional or innovative growing ingredients;
- MillerCoor’s use of its registered trademark ARTFULLY CRAFTED misleads consumers into believing that Blue Moon beer is a craft beer; and
- The premium price of Blue Moon and its shelf “placement” among other craft beers misleads consumers into believing that Blue Moon is a craft beer.
These are not outrageous allegations but, of course, the proof is in the pudding (or facts) and that’s what matters when you file a complaint. The plaintiff must show at a minimum that it has enough facts to make out a claim. MillerCoors didn’t waste any time to move to dismiss Parent’s law suit on grounds that he failed to allege facts that support his claim. The court agreed, writing that Parent’s facts demonstrated nothing more than non-actionable puffery* on the part of MillerCoors and could not sustain a claim for customer confusion or deception. The court dismissed the complaint but gave Parent the opportunity to refile an amended complaint, which it did.
Parent’s amended complaint added some new facts about MillerCoor’s conduct in depicting Blue Moon as a premium craft beer. Plaintiff blamed MillerCoors for:
- portraying Blue Moon as being invented by an independent brewer when, in fact, he was an employee of MillerCoors;
- portraying Blue Moon as being brewed in small limited capacity brew pubs;
- directing retailers to stock Blue Moon with other craft beers;
- permitting retailers to use the Blue Moon trademark in advertisements representing that it is a craft beer;
- advertising Blue Moon as a craft beer at concert venues; and
- selling Blue Moon up to 50 percent more than average macrobrew.
It’s understandable that craft brewers would be concerned. According to Bloomberg, Blue Moon accounted for 15 percent of U.S. beer sales in 2012 prompting MillerCoors to add more artisanal beers to its lineup. Bloomberg suggests that this might be good for the craft brewing industry creating more interest in small batch beers and giving the public what it wants. If you run a microbrewery keep in mind that you are free to “puff” too and in the process build strong brands just like the big boys.
*What is “puffery”? One court defines puffery as “the exaggerations reasonably to be expected of a seller as to the degree of quality of his product, the truth or falsity of which cannot be precisely determined.”
— Adam G. Garson, Esq.