On September 25, 2019, a popular Indiana craft brewery filed a federal lawsuit in the U.S. District Court for the Northern District of Indiana against a New Jersey spiked beverage producer it claims has tarnished its name and hurt its sales with inferior but similar-sounding products.
Three Floyds Brewing LLC is one of Indiana’s longest operating breweries, selling nationally-recognized beers under the name “Three Floyds” since 1996. In 2018, the Defendants, Floyd’s Spiked Beverages LLC, began selling Spiked Lemonade and Spiked Iced Tea under the FLOYD’S trademark. The Defendants’ apparently lower quality beverages are sold within 20 miles of the Three Floyds brewery in Munster, Indiana. The Defendants also sell their product via a website at DrinkFloyds.com. Three Floyds contends that the Defendants have taken advantage of the brewery’s established reputation and goodwill in the hopes of bolstering their own brand.
USPTO Trademark Dispute
According to court documents, Three Floyds has been producing and selling beer under the “Three Floyds” name since 1996, thereby establishing priority rights in the FLOYD mark. The trademark for the name was registered with the U.S. Patent and Trademark Office (USPTO) in 2010. Since then, three other trademarks have been registered to Three Floyds: 3 FLOYDS in 2015, THREE FLOYDS for bar services in 2013, and THREE FLOYDS for distilled spirits in 2019 – the company’s newest venture.
Meanwhile, the complaint alleges Floyd’s Spiked Beverages has been using its own “Floyd’s” name and Logo since at least May 2018. A trademark application for the name has been pending since May 15, 2018, partly because Three Floyds has formally opposed it with USPTO. Contemporaneous with the filing of this immediate action, Three Floyds filed a motion with the USPTO’s Trademark Trial and Appeal Board (TTAB) to stay the TTAB proceedings pending the outcome of this trademark infringement suit “on ground that this action will likely have a bearing on the opposition proceeding and be dispositive of it.”
On November 15, 2018, Floyd’s Spiked Beverages applied for another trademark, this time to use the name “Floyd’s” for a line of beer-based coolers. That application was rejected when a USPTO attorney found the name “so resembles three of the THREE FLOYDS Marks” that consumers would likely confuse the two companies, according to Three Floyds’ lawsuit. The application has since been abandoned.
The complaint’s strongest claim against Floyd’s Spiked Beverages is one for trademark infringement. Trademark infringement is the unauthorized use of a trademark or service mark on or in connection with goods and/or services in a manner that is likely to cause confusion, deception, or mistake about the source of the goods and/or services.
The complaint alleges that Floyd’s Spiked Beverages has been profiting off Three Floyds’ success and popularity in the marketing of its own products, which Three Floyds claims are inferior but share the dominant, recognizable name of “Floyds.” As explained in the complaint, “by virtue of Three Floyds’ continuous and extensive use of the THREE FLOYDS marks, the public has come to identify them exclusively with Three Floyds and its successful, high-quality products, and Three Floyds has built up tremendous goodwill and value in the THREE FLOYDS marks.” Three Floyds has allegedly sold millions of dollars of beer under the THREE FLOYDS name and mark and it has invested significantly in marketing and promoting its beer under the THREE FLOYDS name and mark. Three Floyds has enjoyed enormous success in the craft beer industry and its beers have won numerous awards and considerable public recognition and acclaim, as evidenced by its ranking on RateBeer.com as being among the top ten craft brewers worldwide out of more than 36,000 brewers.
While Floyd’s Spiked Beverages does not produce beer, attorneys for Three Floyds say consumers would likely confuse the “Floyd’s” logo on the spiked products with the “Floyds” or “Three Floyds” marketing on the craft brewer’s products, and assume they are the same company, which could prove detrimental to Three Floyd’s business as the spiked beverages have been met with strong criticism from consumers. In the complaint, Three Floyds reprinted untappd.com reviews of Floyd’s Spiked Beverages, which include critical comments that described the Defendants’ products as “absolutely disgusting” and “truly awful,” among other things.
Request For Relief
In its Prayer for Relief, Three Floyds requested that the Court order the Defendants to “deliver to Three Floyds for destruction all products, literature, signs, billboards, labels, prints, packages, wrappers, containers, advertising materials, stationery, and other items in their possession, custody, or control bearing the FLOYD’S name, mark, or logo or any other trademark or trade name that is confusingly similar to the THREE FLOYDS marks.” In addition, Three Floyds requested that not only the Defendants be ordered to pay Three Floyds its “actual damages sustained as a result of Defendants’ wrongful conduct,” but also be required to pay the “greater of three times” its suffered damages.
The Court granted the Defendants’ Motion for Extension of Time to File Answer on October 18, 2019. The Defendants have until November 22, 2019 to file an answer with the Court.
If you are a brewery owner or beer producer with a potential trademark infringement case, please contact the attorneys at Whitcomb, Selinsky Law PC who specialize in beer and trademark law. Call (303) 534-1958 or contact us via an online form.