Supreme Court Hears Oral Argument in Microsoft v. Baker (Part II)
Southern District of California Dismisses Serial Plaintiff’s Suit Challenging Discount Prices

Recent Suits Alleging Domestic Beers Masquerading as Imports Fall Flat

By Kelly M. Morrison

Beer-drinkIn 2013, a putative class action was filed against Anheuser-Busch alleging that it mislead consumers into believing that Beck’s beer is a German import, when in fact the company had begun brewing it in St. Louis the prior year.  Plaintiffs claimed that labeling statements such as “Originated in Germany,” “German Quality,” and “Brewed Under the German Purity Law of 1516,” along with “Beck’s history of being an imported beer from Germany,” caused consumers to believe they were purchasing beer brewed in Germany.  The Defendant pointed out that the label disclosed that the beer was a “Product of USA, Brauerei Beck & Co., St. Louis, MO,” and the carton stated “Brauerei Beck & Co., Beck’s Beer, St. Louis, MO,” but the Court declined to dismiss the case on the pleadings.  Marty v. Anheuser-Busch Cos., LLC, 43 F. Supp. 3d 1333 (S.D. Fla. 2014).  It later settled for over $20 million.

The plaintiffs’ bar has attempted to replicate the result in Marty by filing similar complaints against a number of beers they claim are marketed as imports, but has so far fallen short.

In Dumas v. Diageo PLC, for example, the Southern District of California dismissed a case alleging that consumers of Red Stipe beer were misled into believing the beer was imported from Jamaica.  The court concluded that no reasonable consumer would be misled by statements that Red Stripe is a “Jamaican Style Lager” that contains “The Taste of Jamaica” into believing the beer is made in Jamaica with Jamaican ingredients.  No. 15-1681, 2016 WL 1367511, at *1, 2 (S.D. Cal. Apr. 6, 2016).  It first explained that “‘Jamaican’ modifies the word ‘Style’ not ‘Lager,’” indicating “that the product is not from Jamaica,” and that “Taste of Jamaica” is “a vague and meaningless phrase.”  Id. at *4.  The court then rejected the contention that the defendant had any duty to “alert consumers who already have an understanding and expectation that Red Stripe is brewed in Jamaica that production of the beer has been moved to Pennsylvania.”  Id. at *5 (emphasis in original).  Finally, it noted that any consumers who were to review the “vague, colorful” language on the back of the bottle stating, “For over 80 years . . . Red Stripe has embodied the spirit, rhythm and pulse of Jamaica and its people,” would likewise see “the words ‘Brewed & Bottled by Red Stripe Beer Company Latrobe, PA.’”  Id. 

Similarly, the Eastern District of New York recently granted a motion to dismiss a complaint alleging that Sapporo’s slogans “Sapporo—the Original Japanese Beer” and “Japan’s Oldest Brand,” inclusion of an image of the North Star on labels, and the word “Imported” on the front label of those beers produced in Canada and sold in the U.S. “created a misleading impression that Sapporo beer is a Japanese import.”  Bowring v. Sapporo U.S.A., Inc., No. 16-1858, 2017 WL 902151, at *1 (E.D.N.Y. Feb. 10, 2017).  The court agreed with the defendant that “clear disclaimers inform the inquiry into whether a reasonable consumer would be misled,” and pointed to language on the beer labels stating “Brewed and Bottled [or Canned] by Sapporo Brewing Company, La Cross, WI for Sapporo U.S.A., New York NY” or, alternatively, “Brewed and canned [or bottled] by Sapporo Brewing Company, Guelph, Ontario, Canada.”  Id. at *1, 3.  It concluded that Sapporo’s use of the term “Imported” on beer brewed in Canada “is a truthful statement, and qualified by the visible disclosure statement specifying the beer’s origin in Canada,” and that Sapporo’s “marketing and slogans allud[ing] to the company’s actual Japanese heritage” were likewise “clearly qualified by the disclaimer.”  Id. at *4.

Apparently undeterred by the courts’ skepticism of claims challenging geographic images and other puffery, plaintiffs recently filed two complaints in the Northern District of California against Craft Brew Alliance, alleging that consumers are misled by “Hawaii imagery, references, [and] metaphors,” such as “Liquid Aloha” and “an image of the Hawaiian island chain,” into believing that its Kona Brewing Company beer “is a local beer made in Hawaii.”  Cilloni v. Craft Brew Alliance, Inc., No. 17-1027, ECF No. 1 (N.D. Cal. Feb. 28, 2017); Broomfield v. Kona Brewing Co., No. 17-1159, ECF No. 1 (N.D. Cal. Mar. 6, 2017). 

It remains to be seen whether the claims in Cilloni and similar pending suits will meet the same fate as those in Dumas and Bowring.  Should they survive the pleading stage, however, plaintiffs may have a difficult time proving harm.  As one article recently explained, brewing closer to the point of sale provides significant consumer benefits, including fresher beer.