Dear Client:

It’s not just the biggest brewers (some of them, anyway) who are stepping up to give distributor/retailer partners some relief on expired or expiring, untapped kegs. 

This morning, BBD broke news that Sierra Nevada would offer a 60% reimbursement of the purchase price of untapped and out-of-code kegs, for distributors who “are providing market-wide relief to on-premise retailers.” That’s good through June 30th. They’ll also “pay for, and arrange, all backhaul freight and product destruction.” And knowing how tight things are for practically everyone these days, they’ve also extended credit terms from 15 days to 21 from April 1-May 31, 2020, where legal. 

Sierra is one of the biggest small brewers, or the smallest big brewers, at more than 1 million barrels annual production. But even suppliers much smaller than them are stepping up to help deter and defray out-of-code beer. 

To wit, 120,000-barrel-ish, Minnesota-based Summit Brewing Company sent notice to distributors yesterday that they plan to offer a full credit on untapped, expired (or expiring) beer kegs, via a detailed plan that they’ll share soon.

Sales director Brandon Bland shared their utmost concern for freshness. While Summit beers have a 150-day shelf life, he said, any beer that reaches 60 days from its time of packaging/kegging “is no longer to be shipped to our distributor partners.” 

“We believe that the internal destruction costs incurred to maintain this policy are a worthy price to pay” to maintain the freshest beer possible at retail.

That philosophy is now fueling a plan to give distributors a full F.O.B. (freight on board) credit or rebate for expiring kegs. 

“The current challenges we face as an industry due to the COVID-19 Pandemic, are no doubt, unprecedented,” Brandon said. 

“We fully understand that these uncertain times are only going to add to the already difficult task of maintaining fresh Summit beer, both at retail and in your warehouses. It is for that reason that Summit will be communicating a detailed plan in the coming days that offers a 100% F.O.B. credit or rebate on any untapped kegged beer that is set to code during the dates of the mandated shut down of bars & restaurants. This goes for both untapped beer at retail, as well as in your warehouse.”

He also hinted at a “phase 2” of the program, some sort of keg beer effort to “help support our collectie on-premise retail partners … once the on-premise restrictions have been lifted.” 

STONE AND MOLSON COORS ARE HEADING TO TRIAL

After two-plus years of arguing their cases before the Court, Stone Brewing and Molson Coors are now set to finish the fight out before a jury in October 2020.

The spat, as you may recall, began back in February of 2018, when Stone filed suit against then-named MillerCoors for allegedly trying to rebrand its Keystone line as Stone. 

Since then, both companies attempted to prevent this case from going to a jury, filing motions for summary judgment and asking the Court to put this argument to rest. But the Court responded earlier this week saying they’re going to leave it up to a jury. 

HIGHLIGHTS FROM THE LATEST UPDATE. Here are some of the highlights from the Court, starting with their response to Stone’s motion for summary for judgment. 

LIKELIHOOD OF CONFUSION “CLOSE,” BUT NO CIGAR. After “evaluating all the factors and the evidence provided by the parties,” the Court said it “cannot find” Stone Brewing has, “as a matter of law, demonstrated a likelihood of consumer confusion, although it is a close call.”

The Court admits that “some” of the eight factors in determining whether a likelihood of confusion exists have weighed in Stone’s favor, but the court does not “merely count beans or tally points.” So, “a triable issue remains on the ‘critical question’ of the degree of similarity of the marks…. Thus, the question of likelihood of consumer confusion ‘should be answered as a matter of fact by a jury, not as a matter of law by a court.’

While Stone came up short on swaying the Court that there’s likelihood of consumer confusion, they did secure a victory elsewhere as the Court decided to toss Molson Coors’ “laches defense,” which argues that one made an untimely delay in making a claim. Essentially, Molson Coors reasoned that Stone took too long to file suit, as Molson Coors has been “using ‘STONE’ and ‘STONES’ in association with Keystone as early as 1991.”

COURT DISMISSES MOLSON COORS’ “LACHES” DEFENSE. Stone argued, however, that its suit stemmed from Molson Coors’ “use of its mark in connection with its Keystone Light refresh in 2017, not any prior use of the mark.” So with Stone filing their complaint less than a year after that refresh, the Court believes “a strong presumption against the application of laches arises.” 

So Stone’s entire Motion for Summary Judgment was “granted in part” (with the dismissal of Molson Coors’ laches defense) and “denied in part” (as Stone failed to demonstrate a likelihood of consumer confusion).

As we stated up top, Stone wasn’t the only one angling for summary judgment. Molson Coors also sought a ruling from the Court, arguing that it has priority right to use “STONE” and “STONES,” because it has utilized the words in commerce as early as 1991.

COURT DENIES MOLSON COORS MOTION FOR SUMMARY JUDGMENT. The Court said this was another “close call,” but there “remains a genuine issue of material fact as to whether MillerCoors has demonstrated a priority right to use the ‘STONE’ and/or ‘STONES’ mark.”

In fact, the Court noted that Molson Coors “may prevail on this issue at trial when the issues are fully fleshed out on direct and cross.” But for now, “such a determination would be improper on summary judgment. Therefore, the Court DENIES Defendant’s motion for summary judgment as to priority right to use.”

So with all that said, this case is heading to trial. 

STONE RESPONDS, HOPING TO RECOVER OVER A BILLION WHEN ALL IS SAID AND DONE. Stone Brewing CEO Dominic Engels stated that the latest update from the Court represents “a good day for independent craft beer and our employees…. The court’s order allows the jury to rectify years of injury to Stone’s name and business. All of us at Stone are hopeful that #truestonevskeystone will have a meaningful impact on Stone and on craft beer as a whole,” Dominic said. The brewer is hoping to recover more than $1 billion in the dispute.

MOLSON COORS “CONFIDENT” IT WILL PREVAIL. For its part, Molson Coors continued to stress in its statement that it’s “been using ‘Stone’ as a moniker for our brand since before Stone Brewing was in business.” They went on to add that “these two products look nothing alike, as the judge noted, and are competing for an entirely different consumer.” Finally, “there is no credible evidence that consumers are confused and we’re confident we will prevail when the case is decided by a judge and jury.”

Until tomorrow,

Jenn, Jordan, and Harry 

“Not everything that can be counted counts, and not everything that counts can be counted.” – Albert Einstein 

———- Sell Day Calendar ———-

Today’s Sell Day: 22

Sell days this month: 22

Sell days this month last year: 21

This month ends on a: Tues.

This month last year ended on a: Fri.

YTD sell days Over/Under:  +1