Hey That’s Me Drinking That Beer! UGC Rights at Issue in Beer/Photo Lawsuit

Kayla Kraft (no known relation to the cheese people) found herself on a Natural Light coaster with a fake handlebar mustache drinking a beer under the heading “Every Natty Has a Story.”  She apparently didn’t like that story and just sued Anheuser-Busch, the makers of Natural Light beer, for copyright infringement and invasion of privacy.

According to the complaint, in 2013 Kraft’s friend Kathyrn Belasco snapped the mustachioed photo of her using Kraft’s phone.  Kraft then posted the photo on Facebook.  Three years later, Belasco assigned all of her rights to the photo to Kraft.

News reports say that the photo was submitted to Natural Light’s Facebook page as part of the “Natty Rewards” contest run in 2014 by Anheuser-Busch where contestants were asked to submit a photo of themselves “acting natural.”  (Unknown whether drinking beer with a fake mustache was Ms. Kraft’s natural state.)  Rules are here. The Rules provide that photos submitted are the original work of the entrant and do not infringe upon anyone’s copyright or publicity rights.  The Rules also grant Anheuser-Busch a license to use the photo in any and all media for any purpose.  Basically, the Rules say everything that’s typical for a UGC contest.

The Complaint doesn’t mention the contest, but does allege that the photo has been used as part of Natural Light’s “Every Natty Has a Story” campaign without Kraft’s or Belasco’s consent.  Anheuser-Busch has not yet answered the Complaint. (more…)

Canadian Company Pursues Moose Trademark: Trouble Brewing for Maine Beer Makers

As brewers and residents of Maine, whose state animal after all is a moose, this recent Bangor Daily News article about a large Canadian corporation chasing U.S. brewers with a trademark for “moose” is cause for concern. I know from my dealings with Maine brewers that potential disputes over product names are usually resolved peacefully and respectfully, but keep in mind that there are other, larger companies beyond our borders who don’t necessarily take the same approach.  (more…)

A Bourbon Conundrum

The recent week-long strike at two Jim Beam facilities in Kentucky highlights a very interesting tension in the current workplace.   Workers at the Boston and Clermont, Kentucky facilities overwhelmingly rejected the second contract proposal in two weeks, stepping out on strike on October 15, 2016.  The second contract proposal included “substantial wage increases” for already very well-paid employees, which left management at a quandary as to why the workers voted to strike. The workers, for their part, wanted a guarantee that the company would hire more full-time workers and stop relying as heavily on temporary workers, among other complaints with the contract proposal.  The crux of their complaint was that they felt that they had to work too much and it was interfering with work-life balance.

Bourbon production, until the recent boom, had traditionally followed a more seasonal production pattern and the company had been hesitant to hire full-time workers during the busy production periods, as they did not want to have to lay the workers off when production inevitably slowed.  However, with the popularity of bourbon at an all-time high, the production schedule for the past two to three years remained consistently high.  The combination of the company’s reluctance to hire more full time workers and the consistently high demand for bourbon resulted in the full-time workers being compelled to take on more overtime hours to keep up with the demand.  Management was surprised by the vote to strike because workers at the two facilities are paid base hourly rates of up to more than three times the Kentucky minimum wage of $7.25 per hour.  At time and a half for all hours worked in excess of forty, those employees were enjoying a significant and sustained spike in their annual earnings.  Union officials acknowledged that the employees knew that they were well-paid; however, they felt that the company had neglected to hire enough full-time, regular employees to keep up with production demands in the now $3 billion business of bourbon production. (more…)

This Week on Tap: Alternative Minimum Tax and Craft Breweries

We all enjoy tax savings, and breweries and distilleries should be taking advantage of recent legislation that went into effect earlier this year that makes the Research and Development tax credit permanent and enhances the tax credit by not limiting the credit to Alternative Minimum Tax (AMT).  Further, the legislation provides a new potential payroll tax credit offset opportunity!  You can read more about the credit here or contact a member of Verrill Dana’s Breweries Distilleries and Wineries Practice Group and Tax Practice Group to discuss more.

I Wine, You Wine, We all Wine for Ice Cream . . . But Not in Massachusetts

Late last month, Massachusetts’s Alcoholic Beverages Control Commission issued an advisory entitled “Alcoholic Beverages Control Commission (“ABCC”) Advisory to § 18 Wholesalers/Importers and § 19 Manufacturers Regarding Alcohol-Infused Ice Cream.”  The Advisory notes that Massachusetts General Law chapter 138 prohibits the importation, manufacturing, and sale of ice cream that contains alcohol with one limited exception—“where the Alcohol and Tobacco Tax and Trade Bureau (“TTB”) has classified in writing that a particular product is a ‘nonbeverage product.’”  The ABCC further noted that the TTB classification was “specific to each individual product a business manufactures, and not a business’s entire line of products.”  The advisory is available here.

Join Us at Brew Talks New England 2016

Verrill Dana’s Breweries, Wineries & Distilleries Group is excited to sponsor this year’s Brew Talks New England, part of Brewbound’s traveling series of meetup events for professionals in the brewing industry, on October 24 at Jack’s Abby in Framingham, Massachusetts. The program will offer both educational and networking opportunities for both new and veteran brewers, distributors, retailers, investors and other professionals interested in the craft beer industry.

Learn more about the event and register here. Please note, 100% of ticket proceeds will be donated to a local charity selected by the host brewery.

We hope to see you there!

Love That Dirty Water, Baby

“I’m gonna tell you a story/I’m gonna tell you about my town/I’m gonna tell you a big fat story, baby/Aw, it’s all about my town/Yeah, down by the river/Down by the banks of the river Charles/…Well, I love that dirty water/Oh, Boston, you’re my home/

The Standells, with those iconic lines, made their way into the vibrant fabric that is Boston, not to mention into the Rock and Roll Hall of Fame’s “500 Songs that Shaped Rock and Roll”. On October 1, some intrepid Boston area brewers are hoping to own their own little slice of history, by claiming the title to “Brew the Charles”, a featured event at the HUBweek closing party. HUBweek describes itself as a “creative festival that celebrates innovation at the intersection of art, science and technology”. (https://hubweek.org/#about-hubweek) As part of this year’s HUBweek, a Newton, Massachusetts-based water technology company, Desalitech challenged area breweries to make a craft beer, using water from the Charles that had been run through its treatment and purification system. Boston Beer Company, Cape Ann Brewing Company, Castle Island Brewing Co., Harpoon Brewery, Idle Hands Craft Ales and Ipswich Ale Brewery all took the challenge, and each will be presenting their craft beer to a thirsty audience at the HUBweek closing event. Twenty percent of the funds raised will go to the local charity aimed at opening a swimming area on the Charles, the Charles River Conservancy’s “Swim the Charles” program. So, if you happen to be in Boston on October 1st, you can do good while feeling good, and it just doesn’t get any better than that.

Brewing is a serious business, and the members of the Verrill Dana Breweries, Distilleries & Wineries Group are here to help your business navigate the rules and regulations of craft brewing. For more information, or to request assistance, contact a member of the Verrill Dana team.

On Tap For Yuengling, Clean Water Act Penalties

Wastewater disposal for large breweries, mid-sized establishments, and even small craft brewers, remains a significant environmental and economic challenge. Recently, the oldest brewery in America received an unpleasant reminder of this fact.

D.G. Yuengling and Sons, Inc. was issued a complaint from the U.S. Environmental Protection Agency (EPA) alleging that Yuengling violated its discharge permit standards at least 141 times between 2008 and 2015. Yuengling holds an Industrial User (IU) permit that allows it to discharge wastewater to the publically owned treatment works (POTW), but only after it treats its discharge to limits set in its permit. Treatment of wastewater before discharge is known as, “pretreatment.” For brewers like Yuengling, pretreatment largely involves balancing pH levels and minimizing Biological Oxygen Demand (BOD) (a measure of how easy it is for microorganism at the POTW to breakdown organic materials) and Total Suspended Solids (TSS) (a measure of how much particulate material is in wastewater). High levels of BOD and TSS make it difficult for the microorganism at the POTW to do its job of breaking down organic matter and sludge. The remnants from the brewing process such as yeast, sugars, and proteins all elevate both BOD and TSS. (more…)

OSHA Penalties May Cause Craft-Industry to Say O SH**

Late last week, while everyone was focused on the summer holiday, the Department of Labor announced that pursuant to the Federal Civil Penalties Inflation Adjustment Act Improvement Act, OSHA’s maximum penalties, which have not been raised since 1990, will increase by 78 percent. This will increase the “serious”, “other-than-serious” and “posting requirements” penalty from $7,000 to $12,471 per violation, the failure to abate from $7,000 per day beyond abatement date to $12,471 per day beyond abatement date, and increase the maximum penalty for willful or repeated violations from $70,000 to $124,709. These figures can drastically hinder any business, let alone any start-ups or craft-beverage producers. (more…)