Why Sony Suing Knee Deep Brewing is GOOD and BAD for Craft

It’s bad, of course, that lawsuits have become the solution to the problems within the industry. The recent lawsuit filed by Sony against Knee Deep Brewing over alleged “trademark infringement, dilution, false designation of origin and unfair competition”  may have a silver lining!  The lawsuit happening between Stone Brewing Company and Miller Coors … another dark cloud with a silver lining! Like anybody, I enjoy all the cool and creative labels that are out there today. In some cases, I think they’re better than the beer inside. It seems though that in some brewers’ desperation to get attention for their brands they are willing to push things right to the edge.  Apparently, it takes more than just good beer to sell beer in this competitive new craft beer market.

We were in South America last month where we saw craft beer labels that went much further with regards to infringement than Knee Deep’s label. There, we saw labels that blatantly used trademarked and copyrighted images on their labels without permission, one of which was also clearly “inspired by” Breaking Bad.  Maybe those brewers figure they’re so far away from the U.S. market that they won’t ever get caught, or maybe their overwhelming passion and excitement is just getting in the way. They should be careful. There is no place distant enough to be immune from the litigious society in which we live.  You only have to look at Kim Dotcom and the fate of MegaUpload to see how serious trademark infringement and copyright violations can be.

BTW: The source of that picture is Kim Dotcom’s Twitter feed.

 

If I blog about Citra®, Simcoe®, Amarillo®, Eldorado®, or Mosaic® and don’t use the proper trademark or copyright symbols, I’ll get an email pretty quickly asking me to fix the situation. There are people watching these sorts of things and there’s money involved for them. So, it’s understandable that they want to protect their investment. While the guys at Knee Deep probably don’t have to worry about a military-style raid of their homes and all their assets being frozen as happened with Kim Dotcom in New Zealand, I would not be surprised if Sony takes advantage of this opportunity to make an example out of Knee Deep.

Craft brewers are notoriously scofflaws. We love that about them! That rebellious underdog image is part of the allure that makes the industry and the products they produce attractive … in addition to good quality beer of course.  Some craft brewers, however, push the limits too far though as it seems Knee Deep may have done. Greg Koch from Stone Brewing Company may be the poster boy for pushing boundaries. My lasting memory of him is from a Hop Growers of America convention a few years back. He had just returned from Germany, was wearing his German jacket, and in front of an audience of hop growers in San Diego that contained plenty of German hop industry people proclaimed that Stone would teach Germany a thing or two about good beer. He went even further to say that German beer is the MUSAC of the beer world. Cringe! I remember thinking at the time, “hopefully the Germans don’t know what MUSAC is”. Based on the well-crafted response by Miller Coors to the Stone lawsuit against them, it seems Stone Brewing Company may have bitten off more than it can chew.  Perhaps, in picking a fight with one of the big boys, Stone Brewing may stand to lose more than they gain.

In the hop industry, we have seen first hand how some craft brewers think rules don’t apply to them in how they treat their hop contracts. Thankfully, the majority of craft brewers are honoring their contracts even in the face of difficulty. A significant number however have chosen to abandon their hop contracts to pursue cheaper hops on the spot market. A brewer once told me that some of his brewer friends believe the risks of being sued are small enough that the financial rewards for abandoning a contract outweigh the risks. That type of thinking is creating a difficult time for most hop merchants and is partially responsible for the growing hop inventories in the U.S., which are all technically sold.

Craft beer is growing up and needs to behave like big boys and girls. That means following some rules. I hate even writing that because there are so many ways that is wrong. Big brewers, for example, routinely exploit their size and power to cancel or renegotiate contracts. We, unfortunately, were the victims of a big craft brewer employing the exact same strategy to get what they wanted. Craft brewers have always proclaimed to be different from big brewers in that they appreciated and wanted to support small family-owned businesses. For the most part this is still true. It turns out, however, some of them get a taste of success and become no different than the big brewers they are trying so hard NOT to be. In the end, they treat hops like a commodity. If all that pretty talk about supporting the little guy is just a show and something to be used when convenient, and if money is really the driving force, then so be it … Lesson learned. The hop industry will adapt to that reality. I still hold out hope, however, that the majority of craft brewers who are good will stay that way, that they will strive to be truly different in both word and in deed and that the bad apples will not spoil the whole barrel.