United States: Anatomy Of A Beer Label: Part III

In addition to the regulatory requirements imposed on beer labels, as discussed in the Anatomy of a Beer Label: Part I on COLAs, and the intellectual property protection offered by trademarks, as discussed in the Anatomy of a Beer Label: Part II, brewers may consider the value they can create through trade dress and copyright.

Trade Dress

"Trade dress" refers to the source-identifying look and feel of a product's shape or configuration, a product's packaging, or the environment in which services are provided.  As with trademarks, businesses gain trade dress rights through use or through registration with the USPTO.  In order to qualify for protection, trade dress must be distinctive and nonfunctional.

With regard to products, there are two subsets of trade dress: product packaging and product design.  Product packaging trade dress, such as a beer label, may be inherently distinctive.  On the other hand, owners of product design trade dress, like the unique shape of a vodka bottle, must prove the product feature has acquired distinctiveness in consumers' minds.

While trade dress may protect beer bottle labels, this protection may not preclude all similar uses on non-alcoholic beverage products.  For example, a court has held that a dog toy that parodies an alcoholic beverage may use similar elements as the alcoholic beverage label due to First Amendment protections.

Copyright

Copyright protects original works of authorship, including pictorial and graphic works such as the art on a beer label.  The law initially provides the copyright owner with exclusive rights, including the right to reproduce, distribute, display, and make derivative works from the original work.  Unlike with trademarks, copyright protections extend beyond the original work's industry or related products or services.  Unauthorized use of a copyrighted work in any medium may infringe on the copyright owner's rights.

Copyright exists from the moment a work of authorship is "fixed," i.e., written down or recorded.  However, business owners, like brewers, gain significant benefits by registering a copyrighted work with the U.S. Copyright Office.  Most importantly, if another party infringes a registered work, copyright law allows the copyright owner to claim up to $150,000 per work infringed plus attorneys' fees, which can provide substantial negotiating leverage.  With infringement of an unregistered work, a copyright owner must prove the extent of the damages in the form of lost profits or ill-gotten gains, which can present challenges.  Also, the copyright owner must register the copyright before filing a copyright infringement lawsuit.

In addition, brewers and other business owners should ensure that they obtain appropriate assignment or license documentation for any artwork, logos, or other copyrightable works created by independent contractors.  Without a written agreement assigning the copyrighted work to the business owner, U.S. copyright law usually presumes that an independent contractor retains ownership of the copyrighted work. Therefore, ensuring that a copyrighted work is properly assigned in writing is a critical part of protecting a business and its intellectual property.

Conclusion

A beer label gives customers their first impression of the beverage and may determine whether they will purchase and consume the beer.  Accordingly, effectively creating and protecting labels provides significant value to brewers.  Given all of the overlapping protections and requirements affecting beer labels, brewers would do well to understand the nuances of such areas of law or otherwise hire knowledgeable advisors.

Co-authored by Colleen Seidel, a summer associate in the Husch Blackwell LLP Washington, DC office.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.