Two recent North Coast wine trademark cases dragged the legal battles over branding back into the public eye.
In December, Healdsburg-based Davis Family Vineyards sued Davis Estates LLC of Napa Valley in federal court, alleging infringement of its registered “Davis Family Vineyards” trademark, used on bottles since the late 1990s, by the use of “Davis Estates” on the Napa Valley wine.
Also in December, Napa-based Waugh Family Wines sued Bronco Wine Co., famous for the “Two Buck Chuck” budget brand Charles Shaw and which has a large south Napa Valley bottling operation. Waugh claims trademark infringement on Waugh’s $150-a-bottle Six Degrees Wine brand by Bronco’s $10–$15 “6° Six Degrees” brand.
So North Bay Business Journal connected with local intellectual-property attorneys for tips on steering clear of costly legal brand battles. Katja Loeffelholz is of counsel for IP, wine law and geographical indications such as “Napa Valley” for Dickenson Peatman & Fogarty; Carle Mackie Power & Ross’ John Dawson, counsel for Davis Family Vineyards; and Davis Estates’ counsel in the matter, Daniel Reidy, whose St. Helena-based Reidy Law Group specializes in IP law and brand acquisition and sales.
How often do you see trademark-infringement cases?
KATJA LOEFFELHOLZ: We see claims of trademark infringement on a weekly basis. Oftentimes, these matters are resolved out of court.
JOHN DAWSON: Over the past 10 years, the number of trademark disputes in the alcohol beverage business, and the wine business in particular, has increased exponentially. It is a function of the number of new producers and new brands in the marketplace. It also reflects the increased awareness by producers of the value of trademarks and just how important brand strength can be to a company’s bottom line and long-term success.
I receive around 20 calls each month from clients regarding new trademark disputes, 90 percent of which are from clients in the alcohol beverage industry. Most of these disputes are resolved privately and confidentially, without having to commence litigation.
How many of these actions are within wine business vs. across industries?
LOEFFELHOLZ: Both. Wine companies are both on the receiving end and the giving end of what are called “cease and desist” letters.
DANIEL REIDY: The standard for trademark infringement is likelihood of confusion. Factors include similarities of marks, the retail channel and sophistication of consumers. If there is actual confusion and it results in loss of sales or consumers’ believing it was from one source, but really it was from another.
We see cases where consumers may not be confused, but we make calls to make sure the producer understands there is a registered mark. We see that in the trade too. In the wine business, you have many duplicate trademarks with Australian or European brands.
Wine consumers are very sophisticated and spend a lot of time educating themselves by coming to Wine Country and learning about the wines. The wine industry is somewhat unique in that aspect, especially with these higher-priced wines. That’s part of the reason why with so many different brands that are so similar they are able to co-exist.
The big issue we face now is with beer and spirits, with dramatic increase of craft beers and spirits. The [U.S. Patent & Trademark Office] considers all alcoholic beverages comparable goods, so we have to spend a lot of time to research brands. It’s a challenge to get a wine mark through when you have thousands of brands out there.
“Often we’re able to work it out…. We can reach a coexistence agreement to steer clear of similar colors and fonts. … I call it ‘trademark karma.’”
—Daniel Reidy, Reidy Law Group, St. Helena
“We send out cease-and-desist letters on a weekly basis — sometimes daily.”
—Katja Loeffelholz, Dickenson Peatman & Fogarty, Napa
“Over the past 10 years, the number of trademark disputes in the alcohol beverage business, and the wine business in particular, has increased exponentially.”
—John Dawson, Carle Mackie Power & Ross, Santa Rosa