MillerCoors Labeling of Blue Moon as ‘Craft Beer’ Not Deceptive12 Jan, 2016 By: Jeffrey Richter, Arthur Yoon
What does the term “craft beer” mean to consumers? Plaintiff Evan Parent filed a class action complaint against defendant MillerCoors involving Blue Moon, a popular brand of Belgianstyle wheat beer owned by MillerCoors, a major beer manufacturer with many well-known brands, including Coors Light and Miller Genuine Draft. The plaintiff alleged that he regularly paid a price premium purchasing Blue Moon beer from retailers because MillerCoors created the deceptive and misleading impression that Blue Moon is a “craft beer.”
According to Parent, Blue Moon did not qualify as a “craft beer” because such beers are produced by small, independent, and traditional craft breweries as defined by the Brewers Association, a trade organization for American craft brewers, and MillerCoors is not such a brewery. The plaintiff alleged that, even though Blue Moon is not really a craft beer, MillerCoors engaged in deceptive and misleading business practices in violation of California’s Consumers Legal Remedies Act (CLRA), False Advertising Law (FAL), and Unfair Competition Law (UCL) by misrepresenting Blue Moon as a craft beer in order to capture a slice of the burgeoning craft beer market and charge up to 50 percent more for Blue Moon beer than it charges for other MillerCoors’ beer brands.
A federal district court in California considered the case. According to the plaintiff, MillerCoors went to great lengths to disassociate Blue Moon from MillerCoors by not disclosing MillerCoors’ ownership of Blue Moon on the bottle or the outer packaging, and not including any reference to MillerCoors on the Blue Moon Brewing Company (BMBC) website. The court, however, determined that federal regulations specifically permit a beer bottle and outer packing to show by label the trade name of the brewer; California regulations provide that the true name of a manufacturer shall be deemed to include a fictitious business name for which a fictitious business name statement has been filed; and MillerCoors properly registered BMBC as a trade name in California’s fictitious business name registry. Consequently, the court determined that the plaintiff’s CLRA, FAL, and UCL claims were barred by the safe-harbor exception to California’s consumer protection laws to the extent that the conduct challenged by the plaintiff – listing BMBC on the Blue Moon bottle and packaging as the manufacturer – was conduct authorized by law.
The court also determined that claims under the UCL, FAL, and CLRA that “representations are misleading” are governed by a “reasonable consumer” test. In regard to the reasonable consumer test, the plaintiff made two arguments. The plaintiff first argued, to show that MillerCoors had gone to great lengths to disassociate Blue Moon from the MillerCoors name, that there was not a single reference to MillerCoors on the BMBC website.
The court did not find that argument persuasive. Since Blue Moon was prominently displayed on the MillerCoors website, in the court’s view, it was not probable that a significant portion of the general consuming public, acting reasonably under the circumstances, could be misled by Blue Moon’s Internet presence.
To the extent that Blue Moon was prominently displayed on the MillerCoors website, the plaintiff next argued that a reasonable consumer was likely to be deceived by MillerCoors’ false identification of Blue Moon as a “craft beer” on the MillerCoors website. The suit alleged that MillerCoors’ misled consumers into thinking Blue Moon was “craft beer” by using the phrase “Artfully Crafted” in the labeling and advertising; charging a premium price, in line with the price of other “craft beers;” and the placement in retail stores of Blue Moon among other “craft beers.”
The court disagreed with the plaintiff’s second argument. It determined that a reasonable consumer, viewing Blue Moon’s identification as a “craft beer” on the MillerCoors website, was not being misled in believing that Blue Moon was an “independently brewed, hand-crafted beer” not owned by MillerCoors. Furthermore, there were no allegations that MillerCoors had any control over the placement of Blue Moon in the retail stores and there was no legal authority for the proposition that the price of the product constituted a representation of that product. Thus, the placement in retail stores of Blue Moon among other “craft beer” and the premium price charged for Blue Moon were not deceptive or misleading. Accordingly, the court concluded that a reasonable consumer would not have been deceived by MillerCoors’ representations regarding the product and dismissed the lawsuit.