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By: Ben Dunlap
What is the difference between beer and bubbly water? This is not a riddle. The distinction features prominently in a trademark suit between Anheuser-Busch InBev and Constellation Brands pending in the Southern District of New York.
The suit, filed in February 2021 by Anheuser-Busch’s Grupo Modelo, the global owner of the Corona brand, against Constellation, which sells the Corona brand in the U.S. market under a 2013 license from Modelo, alleges Constellation has been selling “hard seltzer” products (bubbly water with alcohol and flavoring) not included in the license.
Both parties rely on the “plain language” of the license, but they disagree on what the plain language means.
The issue has come to a head in recent filings by Constellation, arguing in a motion to dismiss the complaint that the license contains a broad definition of “beer” that includes “sugar-based brewed beverages” including “hard seltzers.”
In response, Modelo argued Constellation had never referred to its hard seltzer as a beer, and that “an average person asking for a beer would be perplexed (and likely disappointed) when a bartender serves a Corona Hard Seltzer.”
The dispute serves as another example of the importance of words in intellectual property litigation, and it has substantial consequences as Constellation seeks to expand its share of the growing hard seltzer market in the United States.
For more information, please contact Ben Dunlap at [email protected].