Sazerac Brands, LLC v. Peristyle, LLC, 061418 FED6, 17-5933

Docket Nº:17-5933, 17-5997
Opinion Judge:SUTTON, CIRCUIT JUDGE.
Party Name:Sazerac Brands, LLC, a Delaware limited liability company; Sazerac Company, Inc., a Louisiana corporation, Plaintiffs-Appellants/Cross-Appellees, v. Peristyle, LLC, a Kentucky limited liability company; Peristyle Holdings, LLC, a Kentucky limited liability company, Defendants-Appellees/Cross-Appellants.
Attorney:Brendan J. Hughes, COOLEY LLP, Washington, D.C., for Appellants/Cross-Appellees. Brian F. Haara, TACHAU MEEK PLC, Louisville, Kentucky, for Appellees/Cross-Appellants. Brendan J. Hughes, Michael J. Klisch, COOLEY LLP, Washington, D.C., Scott P. Zoppoth, THE ZOPPOTH LAW FIRM, Louisville, Kentucky,...
Judge Panel:Before: SUTTON, McKEAGUE, and DONALD, Circuit Judges.
Case Date:June 14, 2018
Court:United States Courts of Appeals, Court of Appeals for the Sixth Circuit
 
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Sazerac Brands, LLC, a Delaware limited liability company; Sazerac Company, Inc., a Louisiana corporation, Plaintiffs-Appellants/Cross-Appellees,

v.

Peristyle, LLC, a Kentucky limited liability company; Peristyle Holdings, LLC, a Kentucky limited liability company, Defendants-Appellees/Cross-Appellants.

Nos. 17-5933, 17-5997

United States Court of Appeals, Sixth Circuit

June 14, 2018

Argued: June 7, 2018

Appeal from the United States District Court for the Eastern District of Kentucky at Frankfort. No. 3:15-cv-00076-Gregory F. Van Tatenhove, District Judge.

ARGUED:

Brendan J. Hughes, COOLEY LLP, Washington, D.C., for Appellants/Cross-Appellees.

Brian F. Haara, TACHAU MEEK PLC, Louisville, Kentucky, for Appellees/Cross-Appellants.

ON BRIEF:

Brendan J. Hughes, Michael J. Klisch, COOLEY LLP, Washington, D.C., Scott P. Zoppoth, THE ZOPPOTH LAW FIRM, Louisville, Kentucky, for Appellants/Cross-Appellees.

Brian F. Haara, Melissa Mahurin Whitehead, Kristin E. McCall, TACHAU MEEK PLC, Louisville, Kentucky, for Appellees/Cross-Appellants.

Before: SUTTON, McKEAGUE, and DONALD, Circuit Judges.

OPINION

SUTTON, CIRCUIT JUDGE.

Colonel Edmund Haynes Taylor, Jr., "the most remarkable man to enter the whiskey industry during the post-Civil War years, " built the Old Taylor Distillery in 1887. Once the "most magnificent plant of its kind in Kentucky, " the distillery fell into disrepair after the Colonel's death. Will Arvin and Wesley Murry sought to turn things around. In 2014, they formed Peristyle to purchase the property, renovate it, and eventually resume bourbon production there. Peristyle regularly referred to its location at "the Former Old Taylor Distillery" or "Old Taylor" during the renovation period.

That generated heartburn for the next player in our case, Sazerac, a company that bought the trademark rights to "Old Taylor" and "Colonel E.H. Taylor" in 2009. Sazerac objected to Peristyle's use of the Taylor name and sued Peristyle for infringement. Because Peristyle used the Old Taylor name descriptively and in good faith, it finds shelter under the Lanham Act's fair use defense. We affirm.

I.

In the inimitable words of our late colleague Boyce Martin: "All bourbon is whiskey, but not all whiskey is bourbon." Maker's Mark Distillery, Inc. v. Diageo N. Am., Inc., 679 F.3d 410, 414 (6th Cir. 2012). Bourbon must be made from a grain mixture that is at least 51% corn. 27 C.F.R. § 5.22(b)(1)(i). It must be distilled to no more than 160 proof, barreled at no more than 125 proof, and bottled at no less than 80 proof. Id. It must be aged in charred new oak barrels. Id. And it is a drink of place: It must come from Kentucky.

Generally speaking. As busy bodies from other States like to point out, bourbon need not come from Kentucky, just the United States. Id. § 5.22(1). Hence its moniker: America's native spirit. But let Kentucky have its due. Over 95% of the world's bourbon flows from an old Kentucky home. Bourbon Facts, Kentucky Distillers' Association (2018), https://kybourbon.com/bourbon_culture-2/key_bourbon_facts/. A constellation of circumstances gives the Bluegrass State unique advantages in making bourbon: the local creative spirits, long lost to history, who innovated the brew; the State's pure limestone waters, plentiful oak trees, and a grain-friendly climate, all needed to produce the drink; the too-many-to-count hollows in the eastern part of the State, all needed to sustain the continued production of the drink during Prohibition; and a rich and richly preserved history of bourbon making that stretches back to the late 18th century, all part of the experience of drinking bourbon today.

One part of that history involves the legacy of distiller Colonel Edmund Haynes Taylor, Jr. A jack of all trades, Colonel Taylor brought together marketing, finance, quality control, and lobbying capabilities under one roof, giving rise to the modern bourbon industry. See Reid Mitenbuler, Bourbon Empire: The Past and Future of America's Whiskey 152 (2015). One historian has called Colonel Taylor "the most remarkable man to enter the whiskey industry during the post-Civil War years" and "a bridge between the old ways and the new." Gerald Carson, The Social History of Bourbon: An Unhurried Account of Our Star-Spangled American Drink 87-88 (1963).

Taylor built the Old Taylor Distillery in 1887 in Woodford County, Kentucky. The distillery resembled a medieval limestone castle, surrounded by pergolas, pools, turrets, and gardens, earning...

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