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Consumers don’t just buy products – they buy brands. Brand loyalty means that protecting ones trademarks is vital to a successful business. If a competitor registers a mark that is confusingly similar to one of your company’s registered marks, one clear way to challenge the registration is to wait until the mark is published for opposition and then file a Notice of Opposition with the United States Trademark Trial and Appeal Board. But you can also jump into the fray earlier, before the mark is published for opposition, by sending a Letter of Protest to the United States Patent and Trademark Office (USPTO). The Letter of Protest is a request for the attorney reviewing the proposed mark to consider certain information, which must be provided with the Letter of Protest, when deciding whether the mark should move forward in the registration process or not. If the USPTO believes the evidence provided has merit, the evidence, but not the cover letter itself, will be provided to the reviewing attorney. Thus, it is important that a broad, factually accurate, and objectively persuasive set of evidence is provided. The Letter of Protest may raise any grounds for rejection that are available to the examining attorney. The most popular issues raised tend to be likelihood of confusion with a registered mark, descriptiveness of the proposed mark, and arguments that the proposed mark is generic.

While a Letter of Protest can be filed after a proposed mark is published for opposition, the deadline is thirty days after the proposed mark’s publication. Additionally, the standard of review for examining the evidence provided increases after the proposed mark is published. If a Letter of Protest is filed prior to publication of the proposed mark, the USPTO reviews the evidence to see if it is relevant and supports a reasonable ground for denying registration of the proposed mark. But a Letter of Protest submitted after publication of the proposed mark will be reviewed to see if the evidence supports a prima facie case for refusal, meaning a case for refusal that is self-evident. This standard of review is much higher and more difficult to meet. Thus, if you are going to file a Letter of Protest, it is important to do so early in the examination process. The attorneys at Strike & Techel have filed successful Letters of Protest on behalf of clients before. Please feel free to contact one of our attorneys if you are interested in such a filing or need other trademark assistance.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2012 · All Rights Reserved ·

As readers of this blog may recall, at the end of 2011 interesting new precedent came out of Texas when the United States District Court for the Western District of Texas granted partial summary judgment for plaintiffs in Authentic Beverages Co., Inc. v. Tex. Alcoholic Beverage Comm’n, No. A-10-CA-710-SS (D. W.D. Tex., December 19, 2011), and consequently struck down some Texas’ laws regarding beer labeling, advertising alcoholic content and suppliers telling consumers where their products can be found for purchase. (See our prior coverage of the case here.) About a month later the Texas Alcoholic Beverage Commission (“TABC”) issued Marketing Practices Bulletin 49 regarding the case (available here) and today they’ve just released Marketing Practices Bulletin 50 (available here). The new bulletin stresses that Texas’ stance on suppliers pre-arranging and pre-announcing promotional activities has not changed.

Texas allows liquor manufacturers and wholesalers to pre-arrange and pre-announce promotional activities, for example bar spending or sampling events, novelty item giveaways, and promotional appearances, but they do not allow beer manufacturers and distributors to do the same. While the Authentic Beverages decision resulted in the allowance for beer manufacturers and distributors to advertise retail locations where their products can be purchased (provided the advertising is not cooperative), it has not changed anything regarding pre-arrangement and pre-announcement of promotions. Those promotional activities by beer suppliers must be spontaneous, meaning they are not pre-arranged with retailers or pre-announced to consumers. The TABC is still in the process of formal rulemaking to deal with the effects of the Authentic Beverages decision, at which time Marketing Practices Bulletins 49 and 50 will be superseded by the new rules, but we do not expect that their position will change on this matter and violations are likely an enforcement priority for the TABC.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2012 · All Rights Reserved ·

Last week, the TTB issued an Industry Circular on the issue of tie-in sales, which are illegal under the Federal Alcohol Administration Act (FAA Act) and 27 C.F.R. § 6.72.  Tie-in sales occur when a retailer is forced to purchase a product (which it may or may not want) in order to get the product that it wants.  Tie-in sales include combination sales in which one or more products may only be purchased in combination with other products.

In its Circular, available here, the TTB provides a list of examples of prohibited tie-in sales.  The examples include:

-          A retailer must purchase a certain amount of regular distilled spirits, whether bottled or cased, in order to be allowed to purchase distilled spirits in a special holiday container or packaging.

-          A retailer must purchase ten cases of Winery X’s Merlot from a wholesaler in order to purchase ten cases of Winery X’s Chardonnay.

-          A retailer must purchase an industry member’s pre-mixed alcohol beverage specialty product (for example, strawberry daiquiri) in order to purchase a certain amount of their regular distilled spirits case goods.  In other words, the regular distilled spirits products are not sold separately but only in combination with the specialty product.

-          A retailer is required to purchase a two-bottle package containing one each of a winery’s Merlot and Chardonnay in order to get the Merlot.  The Merlot is not available for purchase separately.

-          A retailer must purchase a slow moving wine in order to purchase a distilled spirit that is in heavy demand.  The distilled spirit is not available for purchase separately.

The take-away point is that each alcoholic beverage item needs to be available for purchase separately.  It is still permissible to package alcohol products together or with other consumer goods, subject to state and federal restrictions, but the alcohol components should also be available separately.  For additional information on the rules applicable to combination packs, contact one of the attorneys at Strike & Techel with any questions.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2012 · All Rights Reserved ·

“The practice of law is often dry, and it is the rare case that presents an issue of genuine interest to the public. This is just such a case, however.”*

The First Amendment and beer aren’t typical dance partners, but they dosey doed on December 19, 2011 when the United States District Court for the Western District of Texas granted summary judgment in part for plaintiffs in Authentic Beverages Co., Inc. v. Tex. Alcoholic Beverage Comm’n. In granting partial summary judgment, the Court found in favor of plaintiffs’ arguments that the First Amendment was violated by Texas’ statutes and regulations that (a) prohibited breweries and distributors from telling customers where their products can be purchased, (b) prohibited advertising the alcoholic content of malt beverages or any suggestions of alcoholic strength, and (c) mandated the use of “beer”, “ale” and “malt liquor” labels on malt beverages with such terms statutorily defined in a manner inconsistent with the ordinary use of those terms.

The Texas Alcoholic Beverage Commission decided not to appeal the District Court’s decision and instead published Marketing Practice Bulletin 49, Changes to Current Regulations – Advertising and Labeling, on January 6^th (available here). The Bulletin will eventually be superseded by formal rulemaking from the Commission after a stakeholders’ meeting on January 27, 2012. Until new rules are in place, the Bulletin allows manufacturers and distributors to advertise the retail locations where their products can be bought, provided such advertising is not cooperative. Additionally, manufacturers and distributors may refer to alcoholic content, including using words like “full strength” and “strong” in advertisements. Finally, brewers may continue to label malt beverages in accordance with the definitions of “beer,” “ale” and “malt liquor” provided in §1.04 of the Texas Alcoholic Beverage Code, or they may provide the percentage of alcohol by volume (“abv”), stated to the nearest 1/10^th of a percent, on the label. If abv is stated, the product may also be labeled with whatever term for such product is commonly recognized in the brewing industry. For purposes of Texas regulatory matters products labeled 5.1% abv or less will be considered beer by the Commission.

* Authentic Beverages Co., Inc. v. Tex. Alcoholic Beverage Comm’n, No. A-10-CA-710-SS (D. W.D. Tex., December 19, 2011), available at http://pdfserver.amlaw.com/tx/abc.pdf.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2012 · All Rights Reserved ·

The California ABC released an Advisory earlier this month that outlines a compliant path for California alcoholic beverage licensees to engage unlicensed service providers. In our practice, this issue comes up often in reference to websites that look like wine shops, but hold no alcoholic beverage licenses of their own. The Advisory is available here.

We were active on the working group that made suggestions on this issue to the ABC, and were pleased that the ABC was willing to listen to industry feedback before deciding on a course of action. We’ve been getting lots of questions on the provision regarding control of funds, which (is long!) and states:

“The control of funds from a transaction involving the sale of alcoholic beverages constitutes a significant degree of control over a licensed business. As such, while a Third Party provider may act as an agent for the collection of funds (such as receiving credit card information and securing payment authorization), the full amount collected must be handled in a manner that gives the licensee control over the ultimate distribution of funds. This means that the Third Party Provider cannot independently collect the funds, retain its fee, and pass the balance on to the licensee. The Third Party Provider should pass all funds collected from the consumer to the licensee conducting the sale, and that licensee should thereafter pay the Third Party Provider for services rendered. Alternatively, the parties may utilize an escrow account, or similar instrument, that disburses the funds upon the instructions of the licensee. So, for example, a Third Party Provider may accept consumer credit card information, debit the card, deposit the funds in an account under the licensee’s ultimate control, and, upon the licensee’s acceptance of the order and direction to the account holder, receive a fee from the account. Given the nature of Internet transactions, the Department recognizes that such collection, acceptance, and disbursement of funds will often times be accomplished solely through computer-generated means.”

We’re looking forward to seeing how the industry adapts to this provision, which seems to require that all funds for an alcoholic beverage sale settle to the account of a licensee before they are disbursed. Will new “alcohol escrow” businesses pop-up to service the need? Will each unlicensed website create its own special accounting to comply? Will fee collection be adversely affected for the unlicensed websites, such that the business model becomes less viable? We’re watching this issue unfold with great anticipation.

Alcohol Beverage industry members may soon hear from the TTB if their websites do not contain a responsible advertiser statement and other information that is mandatory on all alcohol advertisements.  Industry member websites are considered advertisements subject to these requirements, and recently the TTB has been independently investigating websites for compliance.  If the mandatory information is not present on a website’s homepage, the TTB has begun sending letters to industry members requiring compliance and a confirming response to the TTB.

The federal requirements vary slightly depending whether the alcohol being advertised is beer, wine, or distilled spirits, but in general all alcohol advertisements are required to contain a responsible advertising statement that includes the permittee’s name and address, as well as statements regarding the class and type of alcohol.

Industry members – check your websites and other advertisements and make sure they contain all mandatory information!  If you have any questions about these requirements, the attorneys at Strike & Techel are available to help.

** Unless you live in California

Alcoholic beverage companies often sponsor sweepstakes and contests with prizes ranging from elaborate vacations to concert tickets to spa days.  Do you know who can enter these contests and sweepstakes?  Anyone in the U.S except a Californian.

California is the only state to specifically prohibit alcoholic beverage companies from sponsoring sweepstakes and contests with exciting prizes.  Seriously, the only one.  Adding insult to injury, companies that do not sell alcoholic beverages are welcome to offer contests and sweepstakes to Californians.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2011 · All Rights Reserved ·

Trademark owners that want to make sure their marks are not used in the newly-established .XXX internet domain have until October 28, 2011, to opt out of the domain.  .XXX is a domain for adult entertainment websites, and was approved earlier this year by the Internet Corporation for Assigned Names and Numbers.  The sunrise period for .XXX began on September 7, and runs through October 28, during which time applications are being accepted for adult entertainment industry members to register with the domain (called the “Sunrise A” period), as well as for trademark owners that are not in the adult entertainment industry to block the use of their names on the .XXX domain (the “Sunrise B” period).  A trademark owner that registers during the Sunrise B period will effectively remove its brand name from the list of available domain names.

After October 28th, domain names become available to the general public, and trademark owners that have not opted out are at risk of having their marks used on the .XXX domain.  The cost to register in Sunrise B generally ranges from $200 to $300, depending on which domain registrar is used to opt out of .XXX.  You can find the list of accredited registrars here.

If you need assistance with registering your marks during the Sunrise B period, the attorneys at Strike & Techel are available to help.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2011 · All Rights Reserved ·

The Distilled Spirits Council of the United States (DISCUS), the self-regulatory group for the U.S. distilled spirits industry, just released new guidelines for advertising distilled spirits online.  The guidelines were drafted in cooperation with the European Forum for Responsible Drinking, which is the European counterpart to DISCUS.

The full guidelines are available here, and include lots of common sense strategies for responsible online marketing, e.g. identify marketing as such, provide and honor a privacy policy for user data, age gate, market only to adults, and include social responsibility statements.  The guidelines also get specific, instructing advertisers to only place ads in media where 71.6% of the audience is the legal drinking age.  Recent Nielsen data shows Facebook at 82% 21+, Twitter at 87% 21+ and YouTube at 81% 21+.

Digital marketing communications that are intended to be forwarded by users, such as with a share, download or email “button click”, should include instructions to individuals downloading the content that they should not forward these materials to individuals below the legal purchase age.  On a related note, if users provide content on the advertiser’s site or a site controlled by the advertiser, the advertiser should be monitoring and moderating the content every day, or at a minimum once every five business days, to remove inappropriate content.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2011 · All Rights Reserved ·

The United States is home base for pop culture and advertising. According to a 2007 New York Times article, people living in cities see up to 5,000 advertising messages a day, over twice as many as those living in cities 30 years ago saw. And that figure is four years old. Ever since Andy Warhol’s famous Campbell’s Soup Cans, the lines between art, advertising, entertainment, and social commentary have been continuously blurring. But, as the TTB recently reminded people, nowhere are those lines more defined and regulated than in the alcoholic beverage industry. On March 26^th and April 7^th, the TTB released industry circulars on the application of alcoholic beverage advertising regulations to media personality sponsorships and television advertising. The Code of Federal Regulations requires, among other things, that a responsible advertiser statement containing the name and address of the responsible party, appear in all advertisements for wines, malt beverages, and distilled spirits (See 27 CFR §§ 4.62, 5.63, 7.52). 

The TTB’s Industry Circular 2011-01 cautioned against the practice of media personalities who are compensated by alcoholic beverage companies, such as radio hosts, covering certain advertising talking points within a free form story told by the radio host (referred to as unscripted advertisements) without including the mandatory advertising language. The Circular also reminded the industry that such hosts should not make statements about alcoholic beverage products that are prohibited by the Federal Alcohol Administration Act (FAA Act) or TTB regulations. TTB Industry Circular 2011-02 addressed advertisements that are run by television stations more often than contractually required and in such instances often do not include the mandatory information required by the FAA Act and TTB regulations. On top of all that, there is the Federal Trade Commission, which prohibits deceptive and unfair advertising. Thus, if one is paying someone to say something nice about ones products that must be disclosed.

Which leads us to the question: What is an advertisement? The Code of Federal Regulations defines an advertisement as “any written or verbal statement, illustration, or depiction which is in, or is calculated to induce sales in, interstate or foreign commerce” (See 27 CFR §§ 4.61, 5.62, 7.51). The only exceptions from the definition are labels and things like press releases (“editorial or other reading material … in any periodical or publication or newspaper for the publication of which no money or valuable consideration is paid or promised, directly or indirectly, by any permittee, and which is not written by or at the direction of the permittee.”) That’s a pretty broad definition and it’s hard to see where the line exists in modern society. If Kim Kardashian (who reportedly earns $10,000 per tweet) mentions an alcoholic beverage company, does she need to fit the mandatory advertising language into 144 characters? Was Jay-Z’s “Show Me What You Got” music video an advertisement for Armand de Brignac? Whatever these projects are—Advertainment? Entertisement? (you heard the terms here first, unless you heard them somewhere else first)—marketers should remember they are still subject to the standard alcoholic beverages advertising regulations.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2010-2011 · All Rights Reserved ·