NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS DEC 30 2024 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT
STONE BREWING CO., LLC, No. 23-3142 D.C. No. Plaintiff - Appellee, 3:18-cv-00331-BEN-MDD v. MEMORANDUM*
MOLSON COORS BEVERAGE COMPANY USA LLC,
Defendant - Appellant.
Appeal from the United States District Court for the Southern District of California Roger T. Benitez, District Judge, Presiding
Argued and Submitted November 19, 2024 San Jose, California
Before: GRABER, FRIEDLAND, and BUMATAY, Circuit Judges.
Molson Coors Beverage Company appeals a variety of rulings from the
district court after a jury awarded $56 million to Stone Brewing Company for
trademark violation under the Lanham Act. We have jurisdiction under 28 U.S.C
§ 1291 and affirm.
* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. 1. Molson Coors first appeals the district court’s determination that laches
does not bar Stone Brewing’s Lanham Act claims. The duration of the laches clock
here is four years. See Tillamook Country Smoker, Inc. v. Tillamook Cnty. Creamery
Ass’n, 465 F.3d 1102, 1108 (9th Cir. 2006) (holding that the duration of the laches
clock is determined by looking to the statute of limitations period for the “most
closely analogous action under state law” (quotation marks omitted)); Pinkette
Clothing, Inc. v. Cosm. Warriors Ltd., 894 F.3d 1015, 1025 (9th Cir. 2018)
(“California [has a] four-year statute of limitations for trademark infringement
actions.”).
The laches clock began running in 2017 when Molson Coors launched its
“Own the Stone” marketing campaign. See Evergreen Safety Council v. RSA
Network Inc., 697 F.3d 1221, 1226 (9th Cir. 2012) (The laches clock begins when
the plaintiff “knew (or should have known) of the allegedly infringing conduct.”).
Pre-2017 usage is not the basis for any part of Stone Brewing’s claims. See Jarrow
Formulas, Inc. v. Nutrition Now, Inc., 304 F.3d 829, 837 (9th Cir. 2002) (holding
that laches is “triggered if any part of the claimed wrongful conduct occurred beyond
the limitations period”). Rather, all of Stone Brewing’s claims relate to the 2017
“Own the Stone” campaign. Pre-2017, Molson Coors never referred to Keystone as
“anything other than Keystone in packaging[,] marketing[,] or advertising
materials,” never broke up the product name “Keystone,” and used the term “Stones”
2 23-3142 just to refer to the number of beers in the case (“30 stones”) or, in the plural sense,
as a catch phrase (for example, “Hold my Stones”). Stone Brewing brought this suit
within the four-year statute of limitations.
2. We review the denial of judgment as a matter of law de novo, Fifty-Six
Hope Rd. Music v. A.V.E.L.A., Inc., 778 F.3d 1059, 1068 (9th Cir. 2015), and any
factual findings and determinations on the likelihood of confusion for clear error,
Stone Creek, Inc. v. Omnia Italian Design, Inc., 875 F.3d 426, 431 (9th Cir. 2017),
abrogated in part on other grounds as recognized by Harbor Breeze Corp. v.
Newport Landing Sportfishing, Inc., 28 F.4th 35, 38 (9th Cir. 2022). “A jury’s
verdict must be upheld if it is supported by substantial evidence, which is evidence
adequate to support the jury’s conclusion, even if it is also possible to draw a
contrary conclusion.” DSPT Int’l, Inc. v. Nahum, 624 F.3d 1213, 1218 (9th Cir.
2010) (citation and internal quotation marks omitted). To win on its Lanham Act
trademark infringement claim, Stone Brewing had to prove “(1) that it ha[d] a
protectible ownership interest in the mark; and (2) that [Molson Coors’s] use of the
mark [was] likely to cause consumer confusion.” Network Automation, Inc. v.
Advanced Sys. Concepts, Inc., 638 F.3d 1137, 1144 (9th Cir. 2011) (quotation marks
omitted).
The district court did not err in refusing to set aside the jury verdict on the
ground that Molson Coors had a superior interest in the “Stone” mark. Stone
3 23-3142 Brewing applied to register the “Stone” trademark on April 4, 1996, and, despite
Molson Coors’s claim of prior use, substantial evidence supported a conclusion that
Molson Coors did not approve the production of packaging that used “Stone” before
that date.
The district court also did not err in refusing to set aside the jury verdict on
likelihood of confusion. The question of consumer confusion “asks whether a
reasonably prudent marketplace consumer is likely to be confused as to the origin of
the good or service bearing one of the marks.” Stone Creek, 875 F.3d at 431
(quotation marks omitted). We consider several factors to assess confusion. AMF
Inc. v. Sleekcraft Boats, 599 F.2d 341, 348–49 (9th Cir. 1979).
First, Stone Brewing provided some evidence from which a jury could
plausibly conclude there was “actual confusion” by distributors and customers who
thought that Keystone Light was sold by Stone Brewing. Stone Brewing also
presented survey evidence purportedly demonstrating consumer confusion based on
images that appeared on Molson Coors’ branding and packaging. The jury was free
to consider that information.
Second, as to similarity of the marks, Molson Coors expressly de-emphasized
“Keystone” and instead highlighted “Stone” in its 2017 product refresh. See
Brookfield Commc’ns, Inc. v. W. Coast Ent. Corp., 174 F.3d 1036, 1054 (9th Cir.
1999) (holding that similarities between marks are “weighed more heavily than
4 23-3142 differences”).
Third, as to proximity of the goods, the brands compete in the “beer space,”
are sold in the same aisle of grocery stores, and have registered marks (or in Molson
Coors’s case, attempted to register marks) under the same category of “beers and
ales.”
Fourth, the brands use the same marketing and distribution channels. And
both products are sold at the same restaurants and grocery stores, often in the same
aisle.
Fifth, “[l]ow consumer care increases the likelihood of confusion,” and more
expensive products generate greater care. Network Automation, 638 F.3d at 1152
(alteration and citation omitted). Beer is a relatively inexpensive product. And
although the per-unit price of Stone IPA and Keystone Light differ, their prices are,
overall, similar.
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NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS DEC 30 2024 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT
STONE BREWING CO., LLC, No. 23-3142 D.C. No. Plaintiff - Appellee, 3:18-cv-00331-BEN-MDD v. MEMORANDUM*
MOLSON COORS BEVERAGE COMPANY USA LLC,
Defendant - Appellant.
Appeal from the United States District Court for the Southern District of California Roger T. Benitez, District Judge, Presiding
Argued and Submitted November 19, 2024 San Jose, California
Before: GRABER, FRIEDLAND, and BUMATAY, Circuit Judges.
Molson Coors Beverage Company appeals a variety of rulings from the
district court after a jury awarded $56 million to Stone Brewing Company for
trademark violation under the Lanham Act. We have jurisdiction under 28 U.S.C
§ 1291 and affirm.
* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. 1. Molson Coors first appeals the district court’s determination that laches
does not bar Stone Brewing’s Lanham Act claims. The duration of the laches clock
here is four years. See Tillamook Country Smoker, Inc. v. Tillamook Cnty. Creamery
Ass’n, 465 F.3d 1102, 1108 (9th Cir. 2006) (holding that the duration of the laches
clock is determined by looking to the statute of limitations period for the “most
closely analogous action under state law” (quotation marks omitted)); Pinkette
Clothing, Inc. v. Cosm. Warriors Ltd., 894 F.3d 1015, 1025 (9th Cir. 2018)
(“California [has a] four-year statute of limitations for trademark infringement
actions.”).
The laches clock began running in 2017 when Molson Coors launched its
“Own the Stone” marketing campaign. See Evergreen Safety Council v. RSA
Network Inc., 697 F.3d 1221, 1226 (9th Cir. 2012) (The laches clock begins when
the plaintiff “knew (or should have known) of the allegedly infringing conduct.”).
Pre-2017 usage is not the basis for any part of Stone Brewing’s claims. See Jarrow
Formulas, Inc. v. Nutrition Now, Inc., 304 F.3d 829, 837 (9th Cir. 2002) (holding
that laches is “triggered if any part of the claimed wrongful conduct occurred beyond
the limitations period”). Rather, all of Stone Brewing’s claims relate to the 2017
“Own the Stone” campaign. Pre-2017, Molson Coors never referred to Keystone as
“anything other than Keystone in packaging[,] marketing[,] or advertising
materials,” never broke up the product name “Keystone,” and used the term “Stones”
2 23-3142 just to refer to the number of beers in the case (“30 stones”) or, in the plural sense,
as a catch phrase (for example, “Hold my Stones”). Stone Brewing brought this suit
within the four-year statute of limitations.
2. We review the denial of judgment as a matter of law de novo, Fifty-Six
Hope Rd. Music v. A.V.E.L.A., Inc., 778 F.3d 1059, 1068 (9th Cir. 2015), and any
factual findings and determinations on the likelihood of confusion for clear error,
Stone Creek, Inc. v. Omnia Italian Design, Inc., 875 F.3d 426, 431 (9th Cir. 2017),
abrogated in part on other grounds as recognized by Harbor Breeze Corp. v.
Newport Landing Sportfishing, Inc., 28 F.4th 35, 38 (9th Cir. 2022). “A jury’s
verdict must be upheld if it is supported by substantial evidence, which is evidence
adequate to support the jury’s conclusion, even if it is also possible to draw a
contrary conclusion.” DSPT Int’l, Inc. v. Nahum, 624 F.3d 1213, 1218 (9th Cir.
2010) (citation and internal quotation marks omitted). To win on its Lanham Act
trademark infringement claim, Stone Brewing had to prove “(1) that it ha[d] a
protectible ownership interest in the mark; and (2) that [Molson Coors’s] use of the
mark [was] likely to cause consumer confusion.” Network Automation, Inc. v.
Advanced Sys. Concepts, Inc., 638 F.3d 1137, 1144 (9th Cir. 2011) (quotation marks
omitted).
The district court did not err in refusing to set aside the jury verdict on the
ground that Molson Coors had a superior interest in the “Stone” mark. Stone
3 23-3142 Brewing applied to register the “Stone” trademark on April 4, 1996, and, despite
Molson Coors’s claim of prior use, substantial evidence supported a conclusion that
Molson Coors did not approve the production of packaging that used “Stone” before
that date.
The district court also did not err in refusing to set aside the jury verdict on
likelihood of confusion. The question of consumer confusion “asks whether a
reasonably prudent marketplace consumer is likely to be confused as to the origin of
the good or service bearing one of the marks.” Stone Creek, 875 F.3d at 431
(quotation marks omitted). We consider several factors to assess confusion. AMF
Inc. v. Sleekcraft Boats, 599 F.2d 341, 348–49 (9th Cir. 1979).
First, Stone Brewing provided some evidence from which a jury could
plausibly conclude there was “actual confusion” by distributors and customers who
thought that Keystone Light was sold by Stone Brewing. Stone Brewing also
presented survey evidence purportedly demonstrating consumer confusion based on
images that appeared on Molson Coors’ branding and packaging. The jury was free
to consider that information.
Second, as to similarity of the marks, Molson Coors expressly de-emphasized
“Keystone” and instead highlighted “Stone” in its 2017 product refresh. See
Brookfield Commc’ns, Inc. v. W. Coast Ent. Corp., 174 F.3d 1036, 1054 (9th Cir.
1999) (holding that similarities between marks are “weighed more heavily than
4 23-3142 differences”).
Third, as to proximity of the goods, the brands compete in the “beer space,”
are sold in the same aisle of grocery stores, and have registered marks (or in Molson
Coors’s case, attempted to register marks) under the same category of “beers and
ales.”
Fourth, the brands use the same marketing and distribution channels. And
both products are sold at the same restaurants and grocery stores, often in the same
aisle.
Fifth, “[l]ow consumer care increases the likelihood of confusion,” and more
expensive products generate greater care. Network Automation, 638 F.3d at 1152
(alteration and citation omitted). Beer is a relatively inexpensive product. And
although the per-unit price of Stone IPA and Keystone Light differ, their prices are,
overall, similar.
Reviewing all the factors, a reasonable jury could find that Molson Coors’s
2017 product refresh of Keystone Light was likely to cause consumer confusion.
3. Molson Coors also challenges several evidentiary rulings and the district
court’s denial of Molson Coors’s motion for a new trial. Denial of a motion for a
new trial is reviewed for abuse of discretion. Kode v. Carlson, 596 F.3d 608, 611
(9th Cir. 2010) (per curiam). We review for abuse of discretion the district court’s
decision to admit expert testimony. United States v. Valencia-Lopez, 971 F.3d 891,
5 23-3142 897 (9th Cir. 2020). The district court did not abuse its discretion.
Molson Coors first alleges that there must be a new trial because the district
court allowed survey evidence into the record that featured “altered” images of
Keystone Light showing the word “Stone” by itself. But the packaging in which the
cans were sold did feature the word “Stone” on a can in relative isolation. And cases
of Keystone Light, as well as several advertisements released by Molson Coors,
showed images of the can as the survey described.
Molson Coors next argues that the studies offered as evidence by Stone
Brewing supported a theory of trademark dilution rather than trademark
infringement. But reverse confusion, which supports a theory of trademark
infringement, occurs when a consumer “mistakenly thinks that the senior user is the
same as or is affiliated with the junior user.” Ironhawk Techs., Inc. v. Dropbox, Inc.,
2 F.4th 1150, 1160 (9th Cir. 2021). Stone Brewing consistently argued that
consumers were confused as to the origin of Keystone Light and that the “negative
attributes of Keystone were transferred to Stone from this confusion of source.”
Finally, Molson Coors argues that the district court erred in allowing Dr.
Palmatier to present his “brain node” theory on consumer habits, which came from
his peer-reviewed textbook. But “publication in peer reviewed literature, and
general acceptance” favors admission of testimony under Federal Rule of Evidence
702. Primiano v. Cook, 598 F.3d 558, 564 (9th Cir. 2010). The court properly
6 23-3142 admitted Dr. Palmatier’s testimony.
4. Finally, Molson Coors challenges the damages awarded by the jury. We
review for abuse of discretion the district court’s denial of remittitur. Oracle Corp.
v. SAP AG, 765 F.3d 1081, 1087 (9th Cir. 2014). “[A] jury’s award of damages is
entitled to great deference.” In re First All. Mortg. Co., 471 F.3d 977, 1001 (9th Cir.
2006). “In reviewing a jury’s damages award, we must uphold the jury’s finding of
the amount of damages unless the amount is grossly excessive or monstrous, clearly
not supported by the evidence, or only based on speculation or guesswork.” L.A.
Mem’l Coliseum Comm’n v. Nat’l Football League, 791 F.2d 1356, 1360 (9th Cir.
1986) (quotation marks omitted). Once a district court has “upheld a jury award in
denying a motion for a new trial, such a ruling is ‘virtually unassailable.’” Skydive
Ariz., Inc. v. Quattrocchi, 673 F.3d 1105, 1113 (9th Cir. 2012) (quoting Kode, 596
F.3d at 612).
Stone Brewing sought damages in three categories: $32.7 million for past lost
profits, $141.4 million for future lost profits, and $41.8 million for corrective
advertising. The jury returned a verdict for Stone Brewing of $56 million in general
damages—roughly one quarter of requested damages—without indicating what
portion of the award came from which category.
Molson Coors argues that remittitur is appropriate because Stone Brewing’s
“Arrogant Bastard Ale” is not sold under the Stone brand name. But evidence in the
7 23-3142 record indicated that consumer confusion about the Stone brand impacted Stone
Brewing’s other brands as well. Further, Molson Coors’s argument that Stone
Brewing cannot recover past lost profits as a matter of law is not compelling for the
same reasons given with respect to the dilution versus infringement argument above.
Next, Molson Coors argues that Stone Brewing cannot recover future lost profits
because no other court has awarded speculative future lost profits, but, in Oracle,
we upheld a damages calculation that considered a lost future “ongoing stream of
revenue from [the infringed upon company’s] former customers.” 765 F.3d at 1094.
Similarly here, Stone Brewing provided expert testimony that estimated how long it
would take Stone Brewing to recover its sales after corrective advertising. The jury
could reasonably rely on the expert’s calculation to determine that Stone Brewing’s
sales would not recover immediately. Finally, Molson Coors argues that a 25
percent cap must be applied to the corrective advertising damages, but we have never
adopted a 25 percent cap. See Adray v. Adry-Mart, Inc., 76 F.3d 984, 989 n.2 (9th
Cir. 1995) (acknowledging the 25 percent cap but declining to adopt it).
AFFIRMED.
8 23-3142