Most folks think of a trademark as a word or slogan, perhaps a logo – but few are aware that protectable trademark rights may lie in some atypical contexts such as colors and fragrances, as well as product packaging and their distinct features.
The 6th Circuit Court of Appeals is expected to issue its decision shortly on the protectability of a dipped red wax seal atop the bottle of Maker’s Mark bourbon in Maker’s Mark Distillery, Inc. v. Diageo North America, Inc. et al., Case No. 3:03-CV-93-H. In the appeal filed by Diageo, Maker’s Mark seeks affirmation of the 2010 district court decision which ruled that Maker had an exclusive right to use as a trademark the red wax seal which adorns its bourbon bottles. Diageo began using a similar red wax seal on its Cuervo Reserva tequila in 1997, which it introduced into the US market in 2001, spawning the legal dispute in 2003 which is now on appeal. On the one hand, Diageo faces the challenge of showing a “competitive need” for the decorative red wax seal on its tequila that would effectively eviscerate Maker’s rights in the mark (clearly no pun intended). Maker’s case appears correspondingly difficult, as the price points for the respective products vary greatly – with Maker’s Mark bourbon at $20.00 a bottle, and Cuervo Reserva at around $100.00. Then again, the Trademark Office has repeatedly found that different types of liquor are indeed related goods from a trademark standpoint. (Author’s note: Although both subject products fall into the “liquor” category, are they really interchangeable competing products from a consumer standpoint?) This case may ultimately come down to (1) whether consumers will believe the red wax is indicative of common source, i.e., that the products come from one and the same company; and (2) whether Maker’s is entitled to be the exclusive liquor producer using red wax as its trademark atop the bottle. One cannot help but wonder whether a decision by the 6th Circuit will indeed put an end to this dispute once and for all, given the overall investment on both sides to date, and the potential future implications for all decorative bottle features as trademarks throughout the U.S. beverage industry. Potentially, other circuit courts of appeal may agree or disagree with whatever decision they reach.