124 F.3d 137 (2nd Cir. 1997), 1560, Genesee Brewing Co., Inc. v. Stroh Brewing Co.

Docket Nº:1560, Docket 96-9566.
Citation:124 F.3d 137
Party Name:43 U.S.P.Q.2d 1734 GENESEE BREWING COMPANY, INC., d/b/a Highfalls Brewing Company, Plaintiff-Appellant, v. STROH BREWING COMPANY, d/b/a Northern Plains Brewing Company, Defendant-Appellee.
Case Date:August 22, 1997
Court:United States Courts of Appeals, Court of Appeals for the Second Circuit

Page 137

124 F.3d 137 (2nd Cir. 1997)

43 U.S.P.Q.2d 1734

GENESEE BREWING COMPANY, INC., d/b/a Highfalls Brewing

Company, Plaintiff-Appellant,


STROH BREWING COMPANY, d/b/a Northern Plains Brewing

Company, Defendant-Appellee.

No. 1560, Docket 96-9566.

United States Court of Appeals, Second Circuit

August 22, 1997

Argued June 2, 1997.

Page 138

[Copyrighted Material Omitted]

Page 139

[Copyrighted Material Omitted]

Page 140

Richard D. Rochford, Jr., Nixon, Hargrave, Devans & Doyle LLP, Rochester, NY (Harry P. Trueheart, III, James D. Kole, of counsel), for Plaintiff-Appellant.

Ralph T. Rader, Rader, Fishman & Grauer, PLLC, Bloomfield Hills, MI (Paul R. Braunsdorf, Harris Beach & Wilcox, LLP, Rochester, NY, of counsel), for Defendant-Appellee.

Before: NEWMAN, Chief Judge, KEARSE and CALABRESI, Circuit Judges.

CALABRESI, Circuit Judge:

This trademark case concerns the right of a brewer to identify its beer with the words "Honey Brown." Beer can be either lager or ale, and in this case, the plaintiff uses the words "Honey Brown" (and others) on its lager product, while the defendant uses the same words (and others) on its ale product. In resolving the appeal, we explicitly endorse the rule that, when a producer creates a new product that differs from an established product class in a particular characteristic, the law of trademark will not grant the producer the exclusive right to label its product with words that are necessary to describe that new characteristic. Applying that rule, we find that the phrase "Honey Brown" is generic as applied to ales--such as the beer produced by the defendant--since those words are needed to describe a beer in the traditional category of "brown ale" that is brewed with the addition of honey. Because the plaintiff's beer is a lager, and not an ale, and "brown lager" is not a traditional category of beer, it is perhaps possible that the phrase "Honey Brown" may not be generic as applied to the plaintiff's own product. But that is a question we need not decide today. It is enough for us to hold that since the words "Honey Brown" are generic as applied to the defendant's product, the defendant has a right to use them and the plaintiff cannot recover for trademark infringement. The plaintiff may be able to recover for unfair competition, but the particular preliminary relief sought is inappropriate given the generic nature of the words "Honey Brown" as used by the defendant on its product. We therefore affirm the district court's denial of a preliminary injunction.


In this era of renewed interest in quality beers, sometimes dubbed the "Renaissance of Beer," MICHAEL JACKSON, MICHAEL JACKSON'S BEER COMPANION 8 (1993) [hereinafter, JACKSON, BEER COMPANION] many large brewing companies have attempted to cash in on the growing consumer demand for unique, well-made beers, by brewing specialty beers of their own. See Thomas H. Walters, Note, Michigan's New Brewpub License: Regulation of Zymurgy for the Twenty-First Century, 71 U. DET. MERCY L. REV . 621, 668 & n. 416 (1994). In order to conceal the identity of the producer--beer connoisseurs are typically wary of mass-produced beers--these companies market specialty beers under small-town names. See Bill McDowell, In Craft Beer, It's "Style" over Brand Substance, ADVERTISING AGE, Mar. 10, 1997, at 20 (noting that "major breweries have been ... criticized for building marketing cachet by hiding their own specialty beer efforts behind subsidiaries with faux-microbrand names"). And so it is with this case, a dispute between two of America's largest brewing companies--the Genesee Brewing Company ("Genesee") and the Stroh Brewing Company ("Stroh")--doing business as Highfalls Brewing Company and Northern Plains Brewing Company, respectively.

Despite extensive efforts, many large brewers have had little success in the craft-

Page 141

brewing business. Occasionally, however, a large brewer develops a specialty beer that becomes a popular favorite. A recent example is plaintiff Genesee's "JW Dundee's Honey Brown Lager." Sales of that brew, which was introduced in January 1994, have climbed to over 2.5 million cases a year, making it one of the four best-selling specialty beers in the country.

Genesee refers to this beer simply as "Honey Brown." Apparently, prior to Genesee's product, no beer had been marketed with a brand name that included those words. Genesee's labeling and advertising emphasize "Honey Brown," and Genesee chose that title as the beer's "bar call." 1 Consumers have followed suit. The record is flooded with menus, fliers, and unsolicited letters that confirm 1) that a large number of beer drinkers refer to Genesee's product using only the words "Honey Brown," and 2) that many menus list "Honey Brown" among brands of beer, like "Budweiser" and "Coors."

Genesee filed in the United States Patent and Trademark Office for a trademark for its entire product name--"JW Dundee's Honey Brown Lager." The trademark examiner initially rejected Genesee's application, requiring that Genesee disclaim any trademark in the words "Honey Brown." Genesee refused to do so, and appealed to the Trademark Trial and Appeal Board. While that application was pending, the trademark examiner backed down and sent Genesee's trademark application to publication without requiring Genesee to disclaim the right to "Honey Brown." 2 Although it has been published, Genesee's trademark has encountered opposition and has yet to be registered.

In early 1996, defendant Stroh began to market "Red River Valley Honey Brown Ale," with the conceded purpose of competing with Genesee. Stroh's label and advertising, like Genesee's, place emphasis on the words "Honey Brown." Aware of Genesee's attempts to secure exclusive use of those words, Stroh intervened in Genesee's trademark application proceeding, which is now before the Trademark Trial and Appeal Board on Stroh's opposition. That body has stayed the proceedings pending the outcome of this case.

Once Stroh began to produce its "Honey Brown," other brewers introduced products with these words in their names. There are now numerous beers in the marketplace with brand names that contain the words "Honey Brown," including "J.J. Wainwright's Evil Eye Honey Brown," "Bank Draft Honey Brown Ale," "Tivoli Honey Brown Lager," and "Algonquin Honey Brown Lager."

In October 1996, alleging that Stroh had violated § 43(a) of the Lanham Act, 15 U.S.C. § 1125(a), by appropriating Genesee's unregistered trademark and engaging in unfair competition, Genesee filed suit in the United States District Court for the Western District of New York seeking to enjoin Stroh from using the words "Honey Brown" on its product, and to require Stroh to recall and destroy any bottles of Red River Valley Honey Brown Ale currently on the market. In an unpublished opinion dated November 19, 1996, the district court (Michael A. Telesca, Judge ) denied Genesee's motion for a preliminary injunction, concluding 1) that Genesee was not likely to succeed on the merits of its trademark claim, because "Honey Brown" is a generic term that cannot be trademarked; 2) that Genesee was not likely to

Page 142

succeed on the merits of its unfair competition claim, because Stroh had not acted in bad faith; and 3) that the balance of the hardships favored Stroh.

This appeal followed.


In order to obtain a preliminary injunction, a party must demonstrate: 1) that it is subject to irreparable harm; and 2) either a) that it will likely succeed on the merits or b) that there are sufficiently serious questions going to the merits of the case to make them a fair ground for litigation, and that a balancing of the hardships tips "decidedly" in favor of the moving party. See Warner-Lambert Co. v. Northside Dev. Corp., 86 F.3d 3, 6 (2d Cir.1996) (citing Jackson Dairy v. H.P. Hood & Sons, 596 F.2d 70, 72 (2d Cir.1979) (per curiam)). We review a district court's decision to grant or deny a preliminary injunction for abuse of discretion, which occurs, inter alia, when the district court applies the wrong legal standard or bases its decision on clearly erroneous findings of fact. See id.

I. Irreparable Harm

In the context of trademark and unfair competition injunctions, the requirement of irreparable harm carries no independent weight, as we have held that a showing of likelihood of confusion (a requirement of both trademark infringement and unfair competition claims) establishes irreparable harm. See Hasbro, Inc. v. Lanard Toys, Ltd., 858 F.2d 70, 73 (2d Cir.1988).

II. Likelihood of Success on the Merits 3

Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a), creates a federal private cause of action for injunctive relief and damages against a manufacturer who "uses in commerce any word, term, name, symbol, or device" or "any false designation of origin" that is "likely to cause confusion" as to the origin of its product. Section 43(a) may protect unregistered trademarks from infringement, and even offers a degree of protection from unfair competition for "unregistrable marks," such as generic words that have acquired significant secondary meaning.

  1. Unregistered Trademark Infringement

    Section 43(a) may "protect[ ] an unregistered trademark ... against infringement." Grupke v. Linda Lori Sportswear, Inc., 921 F.Supp. 987, 994 (E.D.N.Y.1996) (citing Coach Leatherware Co. v. AnnTaylor, Inc., 933 F.2d 162, 168 (2d Cir.1991)). "[T]he general principles qualifying a mark for registration under § 2 of the Lanham Act are for the most part applicable in determining whether an unregistered mark is entitled to protection under § 43(a)." Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 768, 112 S.Ct. 2753, 2757, 120 L.Ed.2d 615 (1992).

    Thus, Genesee will prevail on the merits of its unregistered trademark infringement claim if it can show that "it has a valid [trade]mark entitled to...

To continue reading