Miller Brewing Co. v. G. Heileman Brewing Co., Inc.

• Decision Date: 14 September 1977
• Docket Number: No. 77-1246,77-1246
• Citation: 561 F.2d 75
• Parties: MILLER BREWING COMPANY, Plaintiff-Appellee, v. G. HEILEMAN BREWING COMPANY, INC., Defendant-Appellant.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 75

561 F.2d 75

195 U.S.P.Q. 281

MILLER BREWING COMPANY, Plaintiff-Appellee, v. G. HEILEMAN BREWING COMPANY, INC., Defendant-Appellant.

No. 77-1246.

United States Court of Appeals, Seventh Circuit.

Argued April 26, 1977.

Decided Aug. 17, 1977.

Rehearing and Rehearing En Banc Denied Sept. 14, 1977.

James Van Santen, Chicago, Ill., Steven E. Keane, Milwaukee, Wis., for defendant-appellant.

Glen H. Kanwit, Chicago, Ill., Anthony L. Fletcher, New York City, Allan W. Leiser, Milwaukee, Wis., John D. Winner, Madison, Wis., for plaintiff-appellee.

William A. Marshall, Beverly W. Pattishall, Chicago, Ill., for amicus curiae.

Before TONE, BAUER and WOOD, Circuit Judges.

TONE, Circuit Judge.

This appeal presents the question whether a misspelled version of the word "light" can become a trademark for a "less filling, low-calorie beer." The District Court answered the question affirmatively and, based on that determination, granted a preliminary injunction, which this court has stayed pending appeal. We hold that, because "light" is a generic or common descriptive word when applied to beer, neither that word nor its phonetic equivalent may be appropriated as a trademark for beer. We therefore reverse the preliminary injunction order.

In May of 1967 a now defunct Chicago brewer, Meister Brau, Inc., began making and selling a reduced calorie, reduced carbohydrate beer under the name "LITE." Late in 1968 that company filed applications for registration of "LITE" as a trademark on the principal register in the United States Patent Office, which ultimately approved three registrations ¹ on the principal register of labels containing the name "LITE" for "beer with no available carbohydrates." ² Meister Brau continued producing and selling beer under the brand name "LITE" in the Chicago area during 1970 and 1971. In 1971 it changed the label used on cans and bottles to eliminate the words "Meister Brau," which had appeared above the word "LITE."

In 1972, with its demise imminent, Meister Brau sold its interest in the "LITE" trademarks, the registrations thereof, and the accompanying goodwill to the plaintiff Miller Brewing Company. For a time Miller continued selling beer under that brand in the Meister Brau marketing area in somewhat smaller quantities than Meister Brau had distributed.

Miller then decided to expand its marketing of beer under the brand "LITE." It developed a modified recipe, which resulted in a beer lower in calories than Miller's regular beer but not without available carbohydrates. The label was revised and one of the registrations was amended to show "LITE" printed rather than in script. ³ In addition, an extensive advertising campaign was undertaken. From 1973 through 1976, Miller expanded its annual sales of "LITE" from 50,000 barrels to 4,000,000 barrels and increased its annual advertising expenditures from $500,000 to more than $12,000,000. In support of its motion for a preliminary injunction in this case, Miller submitted the results of a survey which, as the District Court noted in its opinion and order, showed "that between December, 1975 and March, 1976, a substantial percentage of beer drinkers perceived LITE (43%), Miller LITE (11%), or LITE from or by Miller (1%) as a distinct brand name indicative of a low-calorie or less-filling beer."

Since early 1975 a number of other brewers have introduced reduced calorie beers labeled or described as "light." ⁴ One of these, although not the first, was the defendant G. Heileman Brewing Company, Inc., which began using the name on a beer low in calories but containing available carbohydrates in five test markets in 1976. Heileman had long been engaged in the production and sale of other brands of beer, among which were "Old Style" and "Special Export." The small print on the label Heileman has used for many years for its "Old Style" beer describes that product as "light lager beer."

Miller began filing trademark infringement actions against competitors to enjoin the use of the word "light" at least as early as October 1975, but none of the cases has yet come to trial. Miller did not seek a preliminary injunction against any competitor until the filing of the instant action in November 1976. Two of the seven other brewers against whom actions are pending, Jos. Schlitz Brewing Co. and Peter Hand Brewing Company, have filed briefs amici curiae in this action.

On the basis of affidavits and other written material, the District Court in the case at bar enjoined Heileman from continuing to sell, advertise, and distribute beer "anywhere in the United States, under the brand name incorporating the word 'Light' in the manner of the label attached to the complaint herein . . . and under any colorable imitation of" the labels which had been registered with the Patent Office. This interlocutory appeal is taken from that order as later modified. The label used by Heileman at the time the injunction was entered featured the word "Light" in print much larger than the name "Heileman." As an alternative to its motion in the District Court to vacate the injunction order Heileman filed a declaration of intent to change its label to a form in which the name "Heileman" and the word "Light" appeared in the same size print and a motion for a determination that the new label would not be a "colorable imitation" of the registered labels. The District Court declined to decide the alternative motion, noting that Heileman apparently intended to proceed with the change in labels only if the court declared that the new label was not a colorable imitation of the registered trademarks. Heileman nevertheless proceeded to change its label to the new form and, after the appeal had been docketed, filed in this court a "notification of label change" reciting that, effective no later than April 15, 1977, it "will have wholly abandoned use of the word 'Light' in the form of the (old) label."

Mootness

Before reaching the merits, we must consider the effect of Heileman's formal abandonment of the old label. Assuming without deciding that this act deprived Heileman of standing to challenge the part of the injunction directed against that label or rendered moot any issue as to that label, the appeal is nevertheless not moot. The injunction also runs against "any colorable imitation" of three registered labels, two of which consist simply of the misspelled word "lite." This added proscription must be read in the context, first, of the prohibition against use of the old label, which was not a colorable imitation of the registered labels in any sense except its prominent use of the word "light," spelled correctly, and, second, of the district judge's memorandum and supplements thereto, which make it clear that he believed Miller would probably prevail on its claim to the exclusive use of the word "lite" and its phonetic equivalent on low-calorie beer. So read, we believe the colorable imitation clause is intended to enjoin the use of the word "light" in any prominent way on a label for low-calorie beer. Therefore, the case is not moot.

The Effect of Registration

Miller claims the benefit of 15 U.S.C. § 1115(a), which provides that registration on the principal register

"shall be prima facie evidence of registrant's exclusive right to use the registered mark in commerce on the goods or services specified in the registration subject to any conditions or limitation stated therein . . . ." ⁵

The three registrations on which Miller relies specify "beer with no available carbohydrates" as the goods on which the registered mark is to be used. This limitation came about because the Patent Office refused registration on the applications as initially filed, which described the goods as "beer," on the ground that "LITE" was "merely descriptive" and therefore not registerable because of 15 U.S.C. § 1052(e)(1). In response to this action, Meister Brau offered evidence of secondary meaning, but in addition its attorney stated that "the beer in connection with which Applicant uses this mark is no-available carbohydrates beer . . ." and also had "one-third less calories than ordinary draft beer," and that "LITE" was suggestive rather than merely descriptive of these qualities. The examiner then required that the applications be amended to describe the goods to which the mark applied as "beer with no available carbohydrates" and they were so amended. We hold that the statute means what it says. The registrations are prima facie evidence of Miller's exclusive right to use the word "LITE" for beer with no available carbohydrates, not for any beer, a breadth of coverage which the applicant disclaimed by amending its applications. Inasmuch as the beer marketed by Heileman as its "Light" beer contains available carbohydrates, as indeed does Miller's "LITE," the registrations are not prima facie evidence of Miller's exclusive right to use the mark on that beer. Thus, although we think the result would be the same whether or not § 1115(a) applied, Miller's brand name "LITE" must be evaluated under the common law of trademarks without the benefit of registration.

General Principles

The basic principles of trademark law which are applicable here have often been stated, e. g., Abercrombie & Fitch Co. v. Hunting World, Inc.,537 F.2d 4, 9-11 (2d Cir. 1976); Union Carbide Corp. v. Ever-Ready, Inc.,531 F.2d 366, 378-379 (7th Cir.), cert. denied, 429 U.S. 830, 97 S.Ct. 91, 50 L.Ed.2d 94 (1976), and may be briefly summarized. A term for which trademark protection is claimed will fit somewhere in the spectrum which ranges through (1) generic or common descriptive and (2) merely descriptive to (3) suggestive and (4) arbitrary or fanciful. As the ease with which hues in the solar spectrum may be classified on the basis of perception will depend upon where they fall in that spectrum, so it is with a term on the trademark spectrum.

A generic or common descriptive term is one which is commonly used as the...