from the stonewalled dept
As you may recall, starting a little over 3 years ago we discussed Stone Brewing’s transformation from one-time icon of the craft brewing scene into a trademark bully. What kicked this whole thing off was Stone’s win in a trademark lawsuit against macro-brewer Molson Coors (then Miller Coors, but I will be using the company’s current name throughout the rest of this post). That suit was filed over Molson Coors changing the branding for its Keystone line of beers such that the word “STONE” became the focal point of the branding by way of font size and its prominence on the packaging. Stone Brewing argued this amounted to trademark infringement, something with which I absolutely disagree is the case, but also something for which a jury found in favor of Stone Brewing to the tune of $56 million. As someone who is quite familiar with both products and beer in general, the idea that anyone was mistakenly buying Keystone thinking it was a Stone Brewery product, well, just no. But that, I suppose, is why juries are made up of 12 peers and not 1 Timothy Geigner.
In any case, that wasn’t quite the end of the story. Both companies petitioned the court to keep this going. Stone Brewing amazingly wanted a new trial because that jury found that Molson Coors’ infringement was not willful, limiting the damages. You really would have thought $56 million and Keystone having to nix the new branding would have been enough, but I suppose once your company is bought by the much, much larger Sapporo Breweries out of Japan, all that matters now is getting those sweet returns for investors in any way you can.
Meanwhile, Molson Coors asked for either the court to simply nix the jury results and rule from the bench or issue a new trial as well on grounds that the jury found for Stone Brewing in error and/or that the award was simply out of line with the jury result. That request is more reasonable, I believe, but fairly unlikely, as courts are typically hesitant to simply throw out the result of a jury trial. Given that both parties requested a new trial, however, I had thought there might be some chance of it occurring.
But, no, the court recently told both parties to accept the results, denying all motions.
U.S. District Judge Roger Benitez said that Molson Coors was not entitled to a new trial or a court ruling in its favor, rejecting its arguments that the evidence did not support the verdict.
Benitez also denied Stone Brewing’s motion for a new bench trial on its allegations that Molson Coors used the “Stone” name in bad faith, which could have justified additional damages.
Molson Coors spokesperson Rachel Dickens said the company disagreed with the decision and is evaluating its options, including a potential appeal. Representatives for Stone Brewing did not immediately respond to a request for comment on the decision.
There are some interesting and silly tidbits in the ruling document itself (embedded below), as well as some very frustrating redactions.
For instance, Stone Brewing complained that it was not allowed to perform discovery on a late-added witness called by Molson Coors as one of its reasons for wanting a new trial. The court in turn points out that, uh, actually an offer for discovery of that witness was made and Stone declined it. Oops. There’s more like that, as this thing is 28 pages.
On Molson Coors’ end, it gets more interesting. The lower court, in its ruling documents, included some language that certainly called into question whether the jury reached the correct conclusion. Molson Coors pointed this out as a reason it should get a new trial or a bench ruling. The court not only disagrees, but repeats this language again, pointing out that the jury is tasked with fact-finding and the court’s opinion on the matter is non-material.
While Benitez previously said in an order that he would have ruled for Molson Coors on the question had he “been in the position of fact-finder,” he upheld the verdict on Monday because it was not “unreasonable or against the ‘great weight’ of the evidence.”
And, as the ruling lays out, that is 9th Circuit precedent. But then there’s some really juicy sounding bits in which Molson Coors suggests that, and the court sort of agrees, Stone Brewing withheld… something.
MillerCoors argues Stone’s failure to disclose [REDACTED] was prejudicial discovery misconduct that warrants a new trial. The [REDACTED] was not disclosed until [REDACTED]. The Court’s questioning revealed [REDACTED]. MillerCoors requested an instruction that the jury disregard the evidence, and the Court granted MillerCoors’ request.
MillerCoors argues that evidence of [REDACTED] would have undermined key aspects of Stone’s case, including that Stone’s damages are based on consumer’s negative associations between Stone and a “big beer company” like MillerCoors. Because [REDACTED] MillerCoors argues it could have used the [REDACTED] to undermine Stone’s arguments. Stone argues in turn that MillerCoors received exactly the remedy it asked for during trial (a limiting instruction), and there is a presumption that “curative instructions…[are] followed by the jury.”
Ultimately, the Court concludes that non-disclosure of [REDACTED] does not warrant a new trial. Although the Court feels Stone engaged in a certain level of gamesmanship through this concealment, the Court also finds the offer does not directly affect the issues presented at trial in the way MillerCoors argues. Mr. Koch testified [REDACTED].
Other than maybe knowing for sure who shot JFK, I don’t know that there is another thing in my life I have wanted to know more than what is in those redacted sections.
Ultimately it appears not to matter a great deal, however. The court declined the motions from both sides of this. I suppose Molson Coors could make good on its claim to want to appeal the decision; I certainly think it should have won the original case myself. Still, the company is starting to pile up losses on this whole thing and it might be time to simply cut its losses and put this to bed.