Prelude To Disaster: Craft Beer Trademark Applications Have Doubled In Ten Years
from the litigation-to-follow dept
We’ve been sounding the warning bells on this for some time now, but the craft beer industry has a trademark problem. As the industry continues its explosive growth, bringing with that growth all of the benefits to the economy and to the public along with it, so too has grown the industry’s use of trademarks on all of these new brands. What once was a relatively small cottage industry filled with congenial small players has morphed into very big business. Morphing with it has been that congenial attitude in the industry, with craft breweries now far more protective of their brands and far more willing to send out legal threats and engage in court battles over intellectual property than ever before. It’s gotten to the point that even intellectual property attorneys are beginning to warn everyone that the lawsuits and threats are going to inevitably increase. This represents a roadblock to an otherwise thriving industry and it’s only going to get worse.
That’s because, in the last ten years alone, trademark registrations for craft brews have doubled in number, while just this past year at least one market has seen a twenty-percent increase in registrations.
Registrations for UK beer brands increased by 19 per cent in the last year, according to London-based law firm RPC. The number of new trade marks rose from 968 in 2007 to 1,983 in 2016. The firm said the wave of trademarking came in the wake of craft beer’s increased popularity.
For anyone paying attention to the effect stringent trademark laws and our protectionist culture can have on an industry, the craft beer market is going to provide a wonderful lesson. If proponents of strict trademark law are to be believed, if trademark laws are generally benign or to the public benefit in other words, then the growth will continue. If those of us who have foreseen the coming disaster for some time are correct, however, growth will slow and trademark disputes will explode.
It’s almost a perfect storm for this kind of thing. Craft brewing has elements both of skill and creativity to it. The industry long operated on the fringes of trademark law, with brewers rarely going to battle over creatively named beers and companies. While we’ve already stated that this practice has begun to change over to protectionism, the doubling of trademark registrations in only a decade’s time within a rapidly growing industry, is the kind of outlier that will give us an answer to how trademark laws impact the industry.
Jeremy Drew, a commercial partner at RPC, said the craft beer sector has been “booming”.
“With more players in the market it’s becoming more important that companies protect their intellectual property,” he said, adding that an increase in trademarks could lead to more legal disputes between brands.
It seems obvious to this writer that an increase in disputes will slow growth and scare off potential entries to the market. It may also result in breweries closing due to legal costs and disputes. If that indeed happens, it seems clear that the public is not benefiting from a craft beer market that isn’t maximized, either in consumer options or in benefits to the wider economy. After a decade of explosive trademark registrations, the coming decade in the craft brewing industry is going to be very instructive.