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Last week, and as noted originally by Capitol Confidential, Honorable Gerald W. Connolly, Acting Supreme Court Justice for the State of New York Supreme Court for the County of Albany, issued a decision and order allowing Colonie-based retailer Empire Wine to subpoena NYSLA employees. See Empire Wine & Spirits LLC v. New York State Liquor Authority, Index No. 555-15. The retailer originally brought a special proceeding to compel NYSLA to comply with subpoenas commanding testimony at an administrative proceeding before the NYSLA held on January 23, 2015. Id. at 2. At the proceeding in January, Empire Wine alleged that NYSLA prosecutors refused to allow two subpoenaed respondents to testify during the proceeding and that, instead of moving to quash the subpoenas in advance, the prosecution waited until the witnesses were called to testify to alert Empire that the subpoenaed respondents would not testify. Id. As a result, the Administrative Law Judge adjourned the hearing indefinitely. Id. For more information on the suit and proceeding between the NYSLA and Empire Wine, see, e.g., Retailer Empire Wine Sues New York State Liquor Authority: Direct Shipping; Court Dismisses Empire’s Lawsuit Against NYSLA ; and Bill Introduced to New York State Assembly Supports Empire Wine.

In its motion to compel, Empire argued that, in defense against the original charges brought against the retailer by the NYSLA, the retailer had the right to subpoena witnesses to testify at a disciplinary hearing before the NYSLA as per 9 NYCRR 54.3(h), which provides the following:

Any licensee desiring to subpoena a witness may do so in the name of the Chairman of the State Liquor Authority and in the manner provided for subpoenas in the New York Civil Practice Law and Rules. If evidence other than oral testimony is required, such as documents or written data, the subpoena shall set forth the specific matter to be produced.

The motion addresses other relevant state regulations, such as CPLR § 2302(a) and CPLR § 2308(b) (the latter which specifically refers to subpoenas that are non-judicial), arguing that the Court should order compliance when a subpoena is authorized as an issuer has legal authority to issue such subpoena, which Empire argued was the case (i.e., an attorney of record for a party to an administrative proceeding can issue a subpoena without a court order). 

In its “cross-motion,” the NYSLA argued to quash the subpoenas for the following reasons:

  • Empire failed to pay the proposed witnesses the statutorily required fees;
  • Subpoenas were not issued for proper purposes and instead sought irrelevant information;
  • Empire identified no lawful purposes to compel respondents to testify; and
  • Subpoenas were improperly served.

Further, and perhaps of most interest to industry, the Authority argued that Empire’s assertions that it wanted to use subpoenas to introduce evidence to the Authority’s policies and alleged changes in policy were “without merit as the Authority’s position that a New York State licensee’s violation of other laws is a basis for an improper conduct charge.” Id. at 4.

Upon review, the matters pertaining to fees were rendered resolved and Justice Connolly instead focused on the remaining issue at hand: whether Empire’s subpoenas were authorized and, if so, whether respondents has a clear legal right to quash said subpoenas. Quoting Matter of Edge Ho Holding Corp, 256 N.Y. 374 (1931)—and suggesting that there, indeed, seemed to be fruitful logic behind Empire’s requests as opposed to probing for irrelevant information—Justice Connolly asserted that Empire demonstrated the subpoenas were authorized and NYSLA failed to demonstrate that issuing said subpoena was beyond the power of Empire’s counsel and also failed to “demonstrate a clear legal right to have the subpoenas at issue quashed at this juncture.” Empire Wine & Spirits LLC v. New York State Liquor Authority, Index No. 555-15 at 6. The Court noted it was “unwilling at this time . . . to quash the subpoenas at issue herein.” Id. 

As a result, the Court granted Empire’s application (in part) and denied the NYSLA’s application to quash. Presumably, this means that another administrative hearing will be scheduled, during which Empire will be allowed to subpoena NYSLA employees that previously refused to testify. As in many circumstances, the law once again reveals itself to be long (procedurally), but an interesting process nonetheless. Will Empire receive its long, fought out vindication? Stay tuned.

For more information on New York State wine or alcohol law, direct shipping, or establishing a New York beverage business, please contact Lindsey Zahn.

DISCLAIMER: This blog post is for general information purposes only, is not intended to constitute legal advice, and no attorney-client relationship results. Please consult your own attorney for legal advice.

 

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Last week, Franciscan Vineyards, Inc. of St. Helena filed an opposition to the mark THREE-EYED RAVEN, filed by Applicant Home Box Office, Inc., for alcohol beverages, energy drinks, and non-alcoholic drinks beverages and fruit drinks. Franciscan Vineyards opposes registration of THREE-EYED RAVEN on the grounds that registration is likely to cause confusion with several prior registrations owned by Opposer. Franciscan Vineyards is the owner is many marks containing the words “RAVENS,” “RAVENSWOOD,” and similar, in classes that appear to be expanding, including Class 33. See Franciscan Vineyards, Inc. v. Home Box Office, Inc. 

Opposer argues on the following grounds:

  1. Likelihood of Confusion — registration of Applicant’s mark will cause the purchasing public to believe or assume that Applicant’s Goods are made by, licensed by, controlled by, sponsored by, or in some way connected, related, or associated with Opposer, in violation of Section 2(d) of the Lanham Act. Id. at 4.
  2. Fraud in the USPTO — Opposer alleges that Applicant knowingly made a false and fraudulent statement in its application to register said mark, where Applicant stated it had a bona fide intent to use the mark in commerce or in connection with identified services in Class 32. Opposer states that Applicant has taken “no steps to commence use of its Mark . . . ” and that USPTO relied on this declaration when it acknowledged filing and allowed Applicant to publish. Id. at 5.
  3. No Bona Fide Intent to Use — Applicant’s filing intent is insufficient to establish a bona fide intent to use, and Applicant has taken no steps to begin commercial use of the mark either prior or subsequent to filing its application. Id. at 6.

In its opposition, Franciscan Vineyards is effectively asserting that registration of THREE-EYED RAVENS will cause consumers to erroneously believe there is some association between HBO’s mark and one of Franciscan Vineyards’ marks. Further, Franciscan Vineyards is claiming prior use in commerce with respect to the term “RAVEN” (or similar) in the class of alcohol beverages.

Game of Thrones Three Eyed Raven Ale Beer LabelIt will be interesting to see how HBO responds, as the opposition makes several strong claims without providing evidence (i.e., no intent to use the mark in commerce prior or subsequent to filing the application; and no steps to begin commercial use of Applicant’s Mark prior to or subsequent to filing its application with the USPTO). It appears that there are two label approvals issued by TTB for Three-Eyed Raven Dark Saison Ale, dated November 2, 2014 (5.16 and 15.5 gallons) and November 4, 2014 (1 Pint 9.4 FL OZ). While a TTB label approval does not indicate use in commerce, it seems possible such may cut against Opposer’s argument that HBO did not have an intent to use the mark at issue subsequent to filing its application in June 2014. However, other sources indicate the product may already be selling in commerce.

For more information on wine or alcohol law, labeling, or trademark, please contact Lindsey Zahn.

DISCLAIMER: This blog post is for general information purposes only, is not intended to constitute legal advice, and no attorney-client relationship results. Please consult your own attorney for legal advice.

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Blue Moon Lawsuit: [Not] All About That Label

Last week, On Reserve reported about the class action suit filed against MillerCoors in regard to the Blue Moon malt beverage. See MillerCoors Hit with Class Action Suit for Use of “Artfully Crafted” on Blue Moon Beer. The suit alleges that the company’s Blue Moon beer deceives consumers into thinking the product is “Craft” by marketing the brand as “Artfully Crafted” and disassociating it from MillerCoors. See Parent v. MillerCoors LLC. The complaint outlines the requirements, as determined by The Brewers Association, that must be met in the eyes of the Association for a brewery to qualify as an American craft brewery, including:

  1. Must produce less than 6 million barrels of beer annually;
  2. Be less than 25 percent owned or controlled by a non-craft brewer; and
  3. Make beer using only traditional or innovative brewing ingredients. 

Id. at 4. The above is actually directly from the Brewers Association website, which attempts to define “craft brewer.” It should be noted that TTB, the federal agency that with primary jurisdiction over the labeling and advertising of malt beverages, does not provide a definition of “craft,” “craft beer,” or “craft brewer” (but TTB does, for example, differentiate brewers with respect to excise tax liability for matters pertaining to report of operations for quarterly reporting versus monthly reporting).

This lawsuit is different from similar class actions filed against alcohol beverage companies in that it looks to how the beverage is advertised or presented to the consumer holistically, and does not focus solely on the product’s label. Other suits currently involveBlue Moon Beer Lawsuit MillerCoors claims, such as “HANDMADE,” displayed largely and proudly on the beverage product’s label, and directly presented to the consumer at the point of purchase. After searching the TTB label approval database, it seems that Blue Moon has one label approval for a malt beverage that even mentions the phrase “Artfully Crafted” on its label (pictured right, red text added for emphasis). This does not discount the possibility that other materials—such as posters or display material—not affixed to the bottle may be presented to the consumer at the time of purchase and may boast the term “Artfully Crafted.” In fact, this seems to be the case with Blue Moon, and the essence of  at least one of the claims in the complaint against MillerCoors. But is using the term “crafted” sufficient to say a beer is marketing itself as craft?

The complaint also alleges that MillerCoors “misleads consumers to
believe that Blue Moon is an independently brewed, hand-crafted beer” and “fraudulently claim[s] that Blue Moon is brewed by Blue Moon Brewing Company [by] intentionally omitting the MillerCoors name from Blue Moon products and advertising . . . .” Id. at 4–5. While the MillerCoors site does designate its Blue Moon brand as one of its “craft” lines, the brewer is permitted (under TTB regulations) to use a “Doing Business As” (DBA) name on its labels without otherwise referring to the owner of the federal basic permit (in this case, Miller Coors; as per Section 8 of this COLA approval, it appears that this is what MillerCoors is doing). My general opinion is that it is not misleading to use a DBA name on a label, provided such has been added to the federal basic permit or otherwise approved by TTB. Using a DBA name on labels is actually common industry practice among brewers, custom crush facilities, bottlers, etc.

Ultimately, this new suit is a reminder to alcohol beverage companies that more than just labels are subject to class action suits. Additionally, it is a kind reminder that TTB does have jurisdiction over regulating advertising, websites, and other materials that are not affixed to the beverage’s container (i.e., other than labels). 

For more information on wine or alcohol law, labeling, or trademark, please contact Lindsey Zahn.

DISCLAIMER: This blog post is for general information purposes only, is not intended to constitute legal advice, and no attorney-client relationship results. Please consult your own attorney for legal advice.

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A Flood of Lawsuits and Too Much Blue Moon BeerOn April 24, 2015, a class action lawsuit was filed in state court against MillerCoors LLC, alleging that the company’s Blue Moon beer deceives consumers into thinking the product is “Craft” by marketing the brand as “Artfully Crafted” and disassociating it from MillerCoors. See Parent v. MillerCoors LLC. The plaintiff alleges that MillerCoors “goes to great lengths to disassociate Blue Moon beer from the MillerCoors name” (i.e., MillerCoors does not appear on the bottle of Blue Moon, Blue Moon’s website does not mention MillerCoors, asserting that Blue Moon is brewed by Blue Moon Brewing Company, etc.). The alcohol beverage attorney Robert Lehrman reports more about the suit on his blog here

As On Reserve previously reported, a number of class action lawsuits have been filed against beverage companies in regard to terms like “handmade,” “small batch,” “handcrafted,” and similar on their labels. See Post-Pom Wonderful and the Not So Wonderful Impact on Alcohol Beverages. These are terms that are not necessarily defined by regulators, but since the Supreme Court’s ruling in Pom Wonderful LLC in mid-2014, the number of lawsuits targeting alcohol beverage and food companies in the context of these terms has steadily increased. Of course, Pom Wonderful dealt with whether a competitor could bring a Lanham Act claim alleging unfair competition from false or misleading product information on food and beverage labels regulated by the FDA, and the above referenced cases were not brought on behalf of competitors (they are mostly class actions). In the class action suits currently before various courts, the focus thus far remains on beers and distilled spirits, but it may not be too long before wine is subject to similar suits.

This new case focuses significantly on how Blue Moon is represented, marketed, and advertised to the consumer with respect to allegations under California State law (i.e., misleading and deceptive advertising) and unfair business practices, but it still touches on a key term (i.e., “Craft” in “Artfully Crafted”) and how the beer is presented to the consumer.

Image from Bevlog.

For more information on wine or alcohol law, labeling, or trademark, please contact Lindsey Zahn.

DISCLAIMER: This blog post is for general information purposes only, is not intended to constitute legal advice, and no attorney-client relationship results. Please consult your own attorney for legal advice.

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Apothic Wines Gallo likelihood of confusion APOTHEOSISApplicant Kinney Family Vintners LLC DBA Occasio Winery sought to register the mark APOTHEOSIS for several types of red wine but was opposed by E. & J. Gallo Winery. See E. & J. Gallo Winery v. Kinney Family Vinters LLC d/b/a Occasio Winery, Opposition No. 91207656 (March 10, 2015) [not precedential]. Gallo alleged prior use with respect to the mark APOTHIC for wine and argued that the use of Applicant’s mark was likely to cause confusion with Gallo’s mark. Applicant responded, denied the allegations, and asserted an affirmative defense of laches and unclean hands, but such were waived because Applicant failed to prove such at trial. The outcome of the opposition thus resulted on the similarities between the marks APOTHEOSIS and APOTHIC. 

The parties did not contest that Opposer had used APOTHIC for wine since 2010 and that Applicant filed an Intent to Use application in January of 2012, without claiming or establishing that Applicant had used the mark prior. As a result, the Board based its determination of the likelihood of confusion on an analysis of the similarity of the marks and the relatedness of the goods or services. In such cases, the Opposer bears the burden of establishing likelihood of confusion by a preponderance of the evidence (evidence must be sufficient to determine that the claim is more likely to be true than not).

In its analysis, the Board readily determined that the goods were identical (i.e., both were wines). Id. at 4. Thus, the Board presumed the channels of trade and classes of purchasers would be identical, too. Id. While the Applicant attempted to introduce evidence that its membership system and other methods of sale of its product differentiated the goods, the Board rejected this evidence, asserting it was irrelevant. Id. at 5. The legal identity of the goods and overlapping channels of trade and classes of purchasers weigh in favor of finding a likelihood of confusion, but also decrease the threshold of the similarity of the marks required to be met in order to find likelihood of confusion.

Gallo asserted that its mark was famous, but despite providing a plethora of evidence that might indeed support the fame of the mark, the Board reasoned that it had no context of sales and advertising figures, social media, etc. in regard to how Opposer’s mark might compare to other brands. Id. at 6–7. As a result, the Board declared that Gallo did not prove its mark to be famous but, at the same time, did not provide evidence that its mark was “commercially or conceptually weak” and was at least “fairly strong” and “entitled to a concomitantly broad scope of protection,” thus cutting in favor of finding a likelihood of confusion. Id. at 7.

Thus, the next step the Board took was the analyze the marks in their entireties with respect to sound, appearance, connotation, and commercial impression. In doing so, the Board determined the following:

  • The first five letters of both marks are identical (i.e., “APOTH”) and consumers are likely to focus on the first part of the marks;
  • The marks look and sound similar due to sharing the same first five letters;
  • Applicant’s mark “APOTHEOSIS” means “pinnacle” or “elevation to divine status” or “the perfect example,” and similar;
  • Gallo’s mark “APOTHIC” derives from the word “APOTHECA,” which alludes to a place where (more than 800 years ago) vintners would blend and store coveted products in a secretive place called the Apotheca, and Gallo’s word derives from Apotheca combined with the word “epic”;
  • Even though Gallo intended its mark to mean one thing, there is no evidence that consumers will understand the meaning behind the word APOTHIC;
  • At the same time, APOTHEOSIS is not a commonly used-word and its meaning may not be enough for consumers to distinguish APOTHEOSIS from APOTHIC; and
  • Gallo’s APOTHIC mark has been used on a number of the company’s wines, and consumers may associate APOTHEOSIS as an expansion of one of Gallo’s lines.

Id. at 7–10.

As a result, when considered in their entireties, the Board determined that the marks were more similar than dissimilar. Id. at 10. The similarities of the marks with respect to appearance and sound were more significant than perceived differences in connotation, notably in light of the use of the same first five letters and consumer’s familiarity with Gallo’s expanding lines of wines using the APOTHIC mark. As a result, the Board found that Gallo established its claim of priority and likelihood of confusion by a preponderance of the evidence. 

For more information on wine or alcohol law, labeling, or trademark, please contact Lindsey Zahn.

DISCLAIMER: This blog post is for general information purposes only, is not intended to constitute legal advice, and no attorney-client relationship results. Please consult your own attorney for legal advice.

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New York Is Open for Business — Or Is It?

Alcohol Business is Threatened

Last week, the Albany newspaper Times Union published my most recent op ed on the Empire Wine’s legal battle with the NYSLA. The article discusses the background between the two parties, as well as the catastrophic business environment that could develop in New York State from the Authority’s interpretation of its regulations. New York State claims to be open for business—but is it really?

To read more, please see the original article at Alcohol Business is Threatened.

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Bartholomew-Jaxon-Coumbia -ValleyLast week, Komo News reported that a Seattle-based winery, Bartholomew Winery, was forced to change the name of one of its wine brands after receiving a cease and desist letter from Jackson Family Wines. See Seattle Winery Forced to Change Name, Label After Cease-and-Desist. The wine brand, Jaxon, is reportedly named after the son of the winemakers. While the current vintage for sale is marketed as a 2010, Komo News reports the winery has marketed the Jaxon line since year 2007 and produces about 1,200 bottles per year. Id. However, Jackson Family Wines (owner of the Kendall-Jackson wine brand) recently sent a cease and desist letter to Bartholomew Winery, arguing that the Jaxon label threatens the Kendall-Jackson wine brand.

In particular, according to Komo News, the letter stated the following:

  • The use of JAXON is likely to cause confusion among wine consumers and dilute the JACKSON FAMILY mark; and
  • Thus, Jackson Family Wines requested that Bartholomew Winery cease use of the JAXON mark on any wine products or related goods or services.

In this particular instance, the owner of Bartholomew Winery pursued the (legal) path of least resistance and chose to abide by Jackson Family Wines’ letter. This means Bartholomew Winery, a micro winery, will avoid a potential legal battle with a company with significant market power. In doing so, Bartholomew is forced to change its labels, labeling, website, as well as likely apply for new label approvals on the federal and state levels. Luckily for Bartholomew, this appears to only impact one of its wine lines, as opposed to its entire name (i.e., “Bartholomew”), which may have contributed to the winery’s decision not to fight the cease and desist letter. If the winery’s name was at issue, the owner may have responded differently. (Also fortunately for Bartholomew, the matters seems to have been resolved somewhat amicably and the winery was permitted to sell remaining bottles of Jaxon.)

This dispute is just one of many that has erupted in the wine, beer, and spirits world in relation to trademark. Last week, Moët Hennessy was hit with a trademark infringement suit over its Délice dessert wines. See Moet Hennessy Hit With Suit Over Delice Wine Trademark. In a very thoughtful article, NPR recently discussed the rise of legal disputes amongst craft brewers. See Craft Brewers Are Running Out Of Names, And Into Legal Spats. Much of this article holds true for the wine industry; as in this case, it is unlikely that Bartholomew Winery intentionally infringed upon the mark of another winery, but Jackson Family Wines also has interest in protecting its mark—and inability or unwillingness to defend its mark could be viewed as market weakness and/or open a window of opportunity for competitors to use similar marks.

For more information on wine or alcohol law, labeling, or trademark, please contact Lindsey Zahn.

DISCLAIMER: This blog post is for general information purposes only, is not intended to constitute legal advice, and no attorney-client relationship results. Please consult your own attorney for legal advice.

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TTB is accepting comments through June 15, 2015 on three proposed American Viticultural Areas (“AVAs”), as per a proposed rule in the Federal Register on April 14, 2015. The proposed AVAs are as follows:

  1. Lewis-Clark Valley Viticultural Area (Notice No. 149Docket No. TTB-2015-0005): The proposed AVA of Lewis-Clark Valley includes 306,650-acres in sections of Nez Perce, Lewis, Clearwater and Latah Counties in Idaho and Asotin, Garfield, and Whitman Counties in Washington. This proposed rule also suggests a modification in the boundary of the currently-established Columbia Valley AVA to eliminate overlap with the proposed Lewis-Clark Valley AVA. One comment has currently been submitted with respect to this proposed rule, in addition to a collection of letters supporting the proposed AVA. For more information, see Letters Supporting Lewis-Clark Valley AVALewis Clark AVA Petition, and Lewis-Clark Valley AVA Petition (Tables).
  2. Eagle Foothills Viticultural Area (Notice No. 150Docket No. TTB–2015–0006): The proposed AVA of Eagle Foothills includes 49,815-acres in the counties of Gem and Ada in Idaho. Eagle Foothills is located entirely within the currently-established AVA Snake River Valley. To date, no comments have been received, however a very thorough petition (including evidence of for the name) was submitted to TTB. For more information, see Eagle Foothills AVA Petition and Name Evidence for Eagle Foothills.
  3. Lamorinda Viticultural Area (Notice No. 151Docket No. TTB–2015-0007): The proposed AVA of Lamorinda includes 29,369-acres in Contra Costa County, California. There are presently two comments fully supporting the proposed AVA, in addition to the petition to establish the Lamorinda AVA. See Lamorinda AVA Petition.

AVAs exist to allow vintners to better designate their wines as viticultural areas have distinct profiles and can often relay significant information to a consumer about a wine. In a proposed rule, TTB summarizes evidence received from petitions detailing the name, boundaries, and distinguishing features of each proposed AVA. Evidence often includes the meso-climactic, geological, and historical information of each individual AVA. 

For more information on wine or alcohol law, AVAs, or TTB matters, please contact Lindsey Zahn.

DISCLAIMER: This blog post is for general information purposes only, is not intended to constitute legal advice, and no attorney-client relationship results. Please consult your own attorney for legal advice.

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In January, On Reserve reported that Vignerons de la Méditerranée (“VM”) filed a complaint in the Supreme Court of the State of New York County of Westchester against Harrison-based importer Pasternak Wine Imports. See Vignerons de la Méditerranée sues Westchester County Importer Pasternak. The complaint named Domaines Barons de Rothschild (“DBR”) as a co-defendant to the complaint. Pasternak was the U.S. importer of the French wine company and in its complaint, VM claimed breach of contract with damages of over $600,000. The complaint also alleged several other causes of action including implied covenant of good faith and fair dealing, unjust enrichment, tortious interference, and unfair competition.Pasternak Wine Imports

On Friday, defendants filed an answer, along with affirmative defenses and counterclaims, to plaintiff’s original complaint. See Pasternak Wine Imports, LLC Answer, Affirmative Defenses, and Counterclaims. Defendants denied the majority of plaintiff’s original allegations, and provided some affirmative defenses, of most relevance:

  • Defendants affirmatively stated that Pasternak Wine Imports was the name of a general partnership (now inactive) organized under the laws of Connecticut. The current company is organized under the laws of New York and is an LLC.See id. at 2.
  • DBR formerly owned a 35% partnership interest in Pasternak Wine Imports and, since 2012, has acquired 100% of the LLC membership of Pasternak LLC (the active LLC organized under the laws of New York). Id. at 4.
  • Without objection of Pasternak, and with its full knowledge, the inactive general partnership and the currently active LLC purchased from a then-affiliated company wines from the Pays d’Oc region of France and marketed and sold such wines within a “territory” as per the distribution agreement between plaintiff and Martin Sinkoff Wines, Inc. See id. at 5.
  •  The now-inactive general partnership reorganized its business into an LLC under the laws of New York, and Pasternak acceded to, and ratified, the reorganization, among other things such as continuing to do business with Pasternak LLC. Id.

The defendants raised several affirmative defenses, including ineffective service of process (on each defendant other than Pasternak LLC); defective summons; acquiescence, waiver, and estoppel; account stated and Pasternak LLC’s right to setoff; plaintiff’s repudiation and breach; plaintiff’s unclean hands; and failure to state a cognizable claims. Particularly noteworthy were the following:

  • Defendants raised the affirmative defense that plaintiff acquiesced in conduct originally complained of in its complaint by: (1) Signing a distribution agreement with the original general partnership, which did not prohibit the now-inactive company or its successor from issuing ownership interest, and with full knowledge that DBR owned 35% interest; (2) Acceding to and ratifying the reorganization of the prior general partnership and by continuing to do business with Pasternak LLC through actions like accepting and fulfilling purchase orders, invoicing the LLC, and accepting payment from the LLC; and (3) By allowing the GP and LLP to both purchase the Pays d’Oc wines and to market and sell such wines in the previously agreed upon territory. Id. at 11–14.
  • In or around August 2013, Pasternak LLC and VM agreed upon a statement of account liquidating amounts owed to and by VM. Id. at 14.

In its counterclaim, Pasternak named several additional counterclaim defendants, including but not limited to Vintage Epicure LLC (an LLC organized under the laws of New York, engaged in the sale of wines distributed by VM) and Beverage Group International, LLC (an LLC organized under the law of New York, engaged in the sale of wines distributed by VM). Pasternak counterclaimed on three main grounds: (1) Against VM for breach and repudiation of contract and implied covenant of good faith and fair dealing; (2) Against VM for for account stated and Pasternak’s right to setoff; and (3) Against additional counterclaim defendants for tortious interference with contractual and business relations. Id. at 26–29.

Val D'orbieuPasternak argues that, on or about February 12, 2013 (and during the term of its distribution agreement), and prior to any attempts by VM to address any perceived inadequacies of Pasternak’s representation with Pasternak, Beverage Group International, LLC filed a certificate of assumed name in the Office of the Clerk in the County of Rockland asserting the additional counterclaim defendant would be doing business under the name of, “Val d’Orbieu Americas, USA” and VM registered its “brands” to additional counterclaim defendant. Id. at 23–24. Previously, under the distribution agreement and according the Pasternak’s answer, the Val d’Orbieu wines were among the VM “brands” that were to be exclusively sold to Pasternak. As noted by Pasternak in its answer, Groupe Val d’Orbieu is the entity owning “all or a substantial” part of VM. Id. According to Pasternak, VM neither informed Pasternak nor sought consent from Pasternak in regard to the filing or registration of Val d’Orbieu. Additionally, Pasternak alleges that VM and Pasternak continued to operate under the distribution agreement, until Pasternak received a letter from VM in June 2013 purporting termination. Id. It is to the belief and knowledge of Pasternak that VM was urged by additional counterclaim defendants and/or their employees, members, or managers to register its brands with another entity, as well as to terminate the original distribution agreement. Id. at 24–26.

Pasternak requests a judgment dismissing VM’s claims and attorney’s fees, along with other relief as deemed just and proper. Id. at 28.

What is interesting about this particular case is how easily much of this information can be traced. For example, to confirm Pasternak’s allegations that Beverage Group International, LLC was importing Val d’Orbieu or Vignerons de la Méditerranée wines, for which Pasternak was to remain the exclusive importer, we can easily check the TTB public COLA database or even LabelVision. Using either of those sources, we can see that Beverage Group International, LLC filed several wine label applications on and after March 13, 2014 with the TTB using the DBA Val d’Orbieu Americas, USA. This also means that Beverage Group International, LLC needed to amend its TTB-issued federal basic importer’s permit to include the DBA. Generally, this entails filing an amendment with the TTB and, likely, this occurred well before March 13, 2014. Of course, some issues are still outstanding, such as whether the distribution agreement was still in effect, and these are matters that cannot be solved through a public portal. 

To view a copy of the original complaint, please see Vignerons de la Mediteranee vs. Pasternak and Domaines Barons de Rothschild (Index Number 50102/2015). To view a copy of the answer with counterclaims, see Affirmative Answer, Defense, and Counterclaims.

For more information on wine or alcohol law, direct shipping, licensing, or other legal matters please contact Lindsey Zahn.

Images property of VIBE Conference and Vitisphere, respectively.

DISCLAIMER: This blog post is for general information purposes only, is not intended to constitute legal advice, and no attorney-client relationship results. Please consult your own attorney for legal advice.

 

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Are AUREA and FINCA AUREA Confusingly Similar for Wine?

Finca Aurea Wine Trademark TTABApplicant Roberto Oreste Antonio Busnelli sought to register the mark FINCA AUREA on the Principal Register in standard characters, with FINCA disclaimed in International Class Type 33.  See In re Roberto Oreste Antonio Busnelli, Serial No. 85830131 (February 20, 2015) [not precedential]. The application included a translation that indicated the the mark means, “GOLDEN VINEYARD” in English. Originally, the Trademark Examining Attorney refused the registration under Section 2(d) Trademark Act, 15 U.S.C. § 1052(d), asserting that Applicant’s mark, as applied to the goods in the application, resembled a registered standard character mark “AUREA” in International Class 33 for ““Grape wine; Red wine; White wine; Wine; Wines.” Id. at 2. The Attorney reasoned applicant’s mark was likely to cause confusion, to cause mistake, or to deceive with regard to the registered mark. Applicant appealed after the Attorney made the refusal final.

When the matter reached the Board, the Board first examined the similarity of the goods and the channels of trade (the second and third du Pont factors). In doing so, the Board established the following:

  • Applicant’s goods are identical to those of registrant;
  • The registrant’s goods move in all channels of trade characteristic for such goods and are available to all potential classes of ordinary customers; and
  • Since the wines outlined in the application and the cited registration were legally identical, there was a presumption that the channels of trade and classes of purchasers would be the same.

Id. at 3. Thus, with respect to the second and third du Pont factors, the Board found in favor of likelihood of confusion.

In its analysis, the Board turned the to remaining du Pont factors to determine if a likelihood of confusion existed based on the similarity or dissimilarity of the marks in their entireties with respect to appearance, sound, connotation, and commercial impression. Id. at 4. As noted by the Board in many prior opinions, the test never includes a side-by-side comparison of the marks, but instead examines whether the marks are “sufficiently similar” in their commercial impression to allow a person who encounters both marks to conclude there is a connection between the two parties. Further, the Board noted that its decision is made on the basis of the mark as a whole, not on the basis of specific dissections of the mark, but also explained that it would be rational to weigh some factors more than others provided the conclusion still rests on the mark as a whole. Id. 

The Board noted that the registered mark, “AUREA,” translates to “GOLDEN” in English. The Applicant’s mark, “FINCA AUREA,” translates to “GOLDEN VINEYARD” in English but discounted the term “FINCA.” It went on to reason that the Applicant’s mark begins with a term that somewhat distinguishes it from the registered mark, but the Applicant disclaimed the exclusive right to use the term “FINCA.” Id. at 5. Further, the Board noted that “FINCA,” which translates to “VINEYARD,” is highly descriptive in its association with wine and “[i]t is well-settled that disclaimed, descriptive matter may have less significance in likelihood of confusion determinations.” Id. at 5–6. Further:

  • Applicant’s mark incorporated registrant’s entire mark, which “heightened similarity” between the two marks; and
  • Even though Applicant produced arguments based on the file history of registrant’s mark, the Board reasoned that it was “well-established” it did not take judicial notice of records located in the Patent and Trade Office and each case must be decided on its own facts.

Id. at 6.

Alas, the Board found the Applicant’s mark similar to that of the registered mark and thus found in support of a likelihood to cause confusion.

Image property of Finca Aurea.

For more information on wine or alcohol law, labeling, or trademark, please contact Lindsey Zahn.

DISCLAIMER: This blog post is for general information purposes only, is not intended to constitute legal advice, and no attorney-client relationship results. Please consult your own attorney for legal advice.

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