Brewbound Podcast: Inside the Stone-Molson Coors Verdict with Bianca Bruno and Brendan Palfreyman

[00:00:00] Jessica Infante: A jury award stoned $56 million in its trademark infringement lawsuit against Molson Coors. We're going to talk about it next on the Brewbound podcast. Hello and welcome to the Brewbound podcast. My name is Justin Kendall and I'm the editor of Brewbound and I am joined by Jessica Infante, the managing editor of Brewbound. Jess, we've got a throwback episode. It's just you and me. No Zoe. She's got a much deserved day off.

[00:00:40] Bianca Bruno: I know it's just like the old days. I do miss Zoe, but I'm glad she took the day off. I believe she used her long weekend to take a fun little jaunt that she'll tell us about when she's back

[00:00:50] Jessica Infante: She's probably having her darty right now and we weren't invited. Oh, I'm sure. Yeah, that's that's what the kids do now.

[00:00:57] Bianca Bruno: That is what the kids do.

[00:00:58] Jessica Infante: Yes.

[00:01:00] Bianca Bruno: It's chilly here for darting, but I think she's out of town.

[00:01:04] Jessica Infante: Yeah. Well, good for Zoe, but we'll hold it down. I think we got this.

[00:01:10] Bianca Bruno: I think we'll be OK. I mean, I, too, had a long weekend, so I'm a little fuzzy and you should take one yourself, sir.

[00:01:17] Jessica Infante: Every day is a long day for me at this point, and even worse for Marcy. But that's what you do when you've got a four-month-old, three-month-old, I think. I don't know how long she's been here, but it's been a long time at this point. She's made her presence known. She's very cute, though. Yes, she is very cute, and we'll probably keep her around. and probably yeah probably but we've got a couple of guests this week we're going to be joined again by Brendan Palfreyman the partner with Harris Beach y'all know him he's tweeting on beer twitter about all the lawsuits in the beer industry And we have another guest. We have Bianca Bruno coming up. She is a reporter with Courthouse News Service and her coverage is what Brendan has been retweeting a lot of these last three weeks for the Stone-Molson Course trial. Yes, the trial that was four years in the making finally came to an end last week on Friday. I think it's over at least until maybe there's an appeal or whatever needs to be sorted out after the fact needs to be sorted out. But yes, a jury has awarded Stone $56 million in damages from the trademark infringement lawsuit against Molson Coors. And now we can all take a deep breath and wonder what happens next with Stone in its future. What happens next with this case? If there is an appeal, I'm sure Molson Coors is going to weigh its options. And I have outstanding questions too of, you know, okay, so we had this trial and Stone got it, it's an award, but what happens with the Keystone Light packaging? Are we going to put the Key and the Stone back together or, you know, are they unlocked for the time being? I don't know.

[00:03:09] Bianca Bruno: You got to assume they're probably sitting on it. A good deal of already done. I've already made packaging. So who knows when the transition will happen?

[00:03:18] Jessica Infante: Yeah, imagine having to get those printed cans reprinted. That is a nightmare, especially in the current supply chain environment. But I have no idea if that's even a thing. I've got questions out to folks and nobody has really answered them. So we will see what happens there. And we'll get to more of that with our featured interviews. But first, let's hit some of the news. And if you saw it earlier this week, Heineken is fully pulling out of Russia.

[00:03:48] Bianca Bruno: Yeah, this is, I mean, you covered this this morning, but this is a departure from their announcement a couple of weeks ago that they would be ceasing sales and advertising of the Heineken brand in Russia and that their breweries in the country would continue to operate. But now they've announced that they are going to transition the ownership of those breweries to somebody else. And in a way that ensures that they do not profit from the exit, they're going to pay the salaries of their employees in Russia through the end of 2022. But yeah, this is a this is a big deal.

[00:04:19] Jessica Infante: Yeah. And one of the things that they said is they will not profit from this. And they're going to take it looks like a 400 million euro hit on the sale of its Russian business. So this is more of the fallout from the invasion of Ukraine by Russia.

[00:04:38] Bianca Bruno: Yeah, it's interesting how, you know, we know what our jobs are, but it's always interesting to me how what we do interacts with world events. Like if you had told me two and a half years ago, like, hey, you're going to have to write about, I mean, obviously I'm an informed person, so I know what is going on in general current affairs, but I would never have guessed that they would overlap with my daily life as much as they have been.

[00:05:06] Jessica Infante: Yeah, and talk about real life. Heineken is said that it will guarantee the salaries of its 1,800 employees in Russia through the end of 2022. And then they will do their utmost to safeguard their future employment. So I don't know exactly what that means or how that works, but. Heineken is pulling out of Russia. They said that it is no longer sustainable nor viable in the current environment to continue that business there.

[00:05:37] Bianca Bruno: In my pursuit of being an informed person, I listened to way too many daily news podcasts. And this morning, the New York Times, The Daily, which I listen to daily, they followed a woman who fled from Kiev with her son. And first she went to Poland and she didn't know where she was gonna go. And you could just like,

[00:05:56] Jessica Infante: really difficult to even imagine what that is like if you're plugged into the news you've seen some form of nightmare play out whether it's a bombing of the fuel depot over the weekend before the biden speech or whether it's you know cnn profiling a little girl like preteen who is a dancer who was shot by a Russian soldier and she's in recovery in the hospital or the nursery ward of hospitals that keep being moved to the basements with sandbags. It's a nightmare. I wish I was more articulate, but it's just terrible.

[00:06:35] Bianca Bruno: Absolutely terrible.

[00:06:37] Jessica Infante: Well, let's get back to the business of beer and businesses that have had some struggles. Modern times, they had a Zoom meeting for their league membership, the League of Partygoers and Elegant People, as well as the Theory of Leisure Committee. Their leaders took part in a 53-minute Zoom meeting earlier this month, and that meeting was recorded and leaked to the full pint. And I think we both watched it. I've watched it like two or three times already, because what else do I have going on?

[00:07:15] Bianca Bruno: I think I just watched it the once, but I listened to the recording afterwards.

[00:07:21] Jessica Infante: Yeah. The fallout of this is really more information on where they're going in the future, which is more fallout from CEO Jennifer Briggs' interview with Good Beer Hunting in which she said, you know, that they would entertain a buyer or an investor. And she stressed that there are no offers on the table and they don't really have their valuation yet. I think that was more set for May or June. But they're pretty much open for business, is what I took away from this. Yeah, I mean, half their tap rooms aren't, but... Well, I mean, open for business in the regard of entertaining, fielding offers. That's just me making a very poor joke. Yes.

[00:08:04] Bianca Bruno: Yeah, I mean it was interesting to hear the questions that were submitted by league members. Some of them were very granular and people were asking like how important is the league to the company? Will the league stay? And clearly these league members are very engaged and enjoy being part of the club.

[00:08:25] Jessica Infante: Well, if there are, what, 1,850 League members and they're paying, what is it, $350 to be part? I would think that that is an important part of the modern times business.

[00:08:41] Bianca Bruno: Yeah, absolutely. In my old life, I had to examine them and decide if it was something that we wanted to do. did not want to go that route, because it sounds like a very complicated organization to have to stay in front of and ahead of, especially when you collect people's money with the promise of delivering them beer at set points throughout the year. I don't know. It seems like a complex thing to run, but it also seems really important to their business. But it was interesting to me to see how open Jennifer was, just shooting them straight and being really upfront and honest about all of the problems that they've been through. She's in a tough, tough spot. I don't envy her.

[00:09:19] Jessica Infante: They're all in tough spots. It's not the same situation as Stone, but what we saw play out in front of a jury with Stone leaders discussing the state of that company and what they owe VMG Hill House, which is $464 million. And then you see what's going on with Modern Times. And we know that there are a number of notes that are coming due to Jacob McKean, his father and his brother. at least as of the last WeFunder slash SEC filing that they filed, which is part of that ESOP. There are a lot of notes out that are going to come due and need to be paid.

[00:10:02] Bianca Bruno: Yeah, what's interesting to me about modern times is that, and Jennifer mentioned this, a pretty big blow to their business was losing some chain placements in the wake of everything that came out last spring and summer. And you have to wonder, is this the biggest economic hardship that a brewery has faced since being named in the outpouring of stories of toxic workplaces and harassment that began last May? I think they might be. I can't think of anybody else that suffered such a catastrophic loss that is still reverberating.

[00:10:32] Jessica Infante: We don't have any other information on which chain or how many of them, but it sounds like it was significant enough that it's put them in some form of peril.

[00:10:44] Bianca Bruno: Yeah. I mean, the thing I just keep coming back to about what happened last spring and summer is what happens now. And one of the biggest forms of consequences I can think of is what's happening with this brewery.

[00:10:58] Jessica Infante: With that, I think we'll get to a final plea before we get to our featured interviews. I'll let you take it away because I know this is near and dear to your heart.

[00:11:09] Bianca Bruno: So near and dear in that the idea of these things makes me extraordinarily angry. We talked about this last year. We talked about April Fool's Day press releases and I just, you know, Don't do it. It's not fun. It's not cool. You're not as funny as you think you are. And I'm sorry to rain on the parade here, but we get hundreds of April Fool's Day press releases that usually aren't funny. I don't know. Half the time we get like, clearly like somebody thought this would be a funny joke. Like, oh, like we're going to make a hazy IPA. Can you believe it? We said never, but now we are. So that makes me think, oh, okay. So they're doing this. But then at the end, it's like April fools. Like that's, that's not good. That's not funny. The other problem is that I'm supposed to, I'm a journalist and it's my job to find out what the truth is. And I'm supposed to, receive information from you that's a lie? No, we're not posting these. We're not posting these. We're a news publication, not a joke publication. I'm done.

[00:12:07] Jessica Infante: And well, some of these actually become reality too after the fact, oddly enough.

[00:12:14] Bianca Bruno: I can see, I guess. We're just shutting it down on April 1st.

[00:12:19] Jessica Infante: We're just, we're not operating. How about that? Please. I'm just going to take a full WrestleMania weekend and call it good.

[00:12:28] Bianca Bruno: Provend is closed for the weekend. Leave us alone.

[00:12:30] Jessica Infante: Yes. Put up our sign.

[00:12:32] Bianca Bruno: Not here. No, I will be in Portland, Maine for the Maine Brewers Guild's New England Brew Summit, speaking on a panel about how to pitch the media on Thursday, March 31st, which is probably when you will hear this podcast. And I plan on making the exact same rant that I just did just now, but hopefully I'll somehow make it funnier.

[00:12:52] Jessica Infante: Spoiler alert to the people of the New England Craft Beer Summit.

[00:12:57] Bianca Bruno: Yeah.

[00:12:59] Jessica Infante: Very lucky folks, and I'm sure it'll be a great time had by all.

[00:13:04] Bianca Bruno: Yeah, it'll be just as fun as Phil Walsh Academy Career Day on Friday. And this will conclude the Jess and Fante Speaking Tour.

[00:13:12] Jessica Infante: I'm glad that you were able to enlighten the Catholic schoolgirls of the future or the present about the beer journalism world.

[00:13:21] Bianca Bruno: I did, I told them that I can't believe that this is really my job, because it is so much fun most of the time. And then I'd be happy to talk to them about journalism for now. And maybe in five years, we can talk about beer.

[00:13:37] Jessica Infante: And it went well?

[00:13:38] Bianca Bruno: I think so. They seemed interested.

[00:13:41] Jessica Infante: Good. We're going to be hitting the Brad Avery soon, too. And we're going to be heading to Minneapolis for the Craft Brewers Conference at the beginning of May. And we're going to be holding our Brew Talks event, our meetup and networking event on Monday, May 2nd from 1 to 4 p.m. Central Time. venue to be disclosed in the very near future, but it's going to happen and we've got some great guests lined up. We've got guests who are going to be speaking about crypto and NFTs. We're going to be talking about ways of getting more breweries in on the ground floor of this industry through incubators and residency programs and special programs like Brewing the American Dream. We're also going to be discussing big box retail with Target. We're going to be right in their backyard and they're going to be joining us to, you know, tell you how you can sell in their stores. So you can find tickets at Brewbound.com. We donate some of the proceeds to the Minnesota Craft Brewers Guild. So we're going to be helping the guild out and they've got a lot of initiatives that Jess is writing about currently, including the free the growler bill. So. Monday, May 2nd, Brew Talks. Mark your calendars and hopefully you'll join us and we'll have some beers and some chats. All right, joining us now is Brendan Palfreyman, partner at Harris Beach. He's the man on Beer Twitter tweeting about all of the beer-related lawsuits. Brendan, how you doing?

[00:15:23] Stone Brewing: Not too bad, digging out from the snow here in Syracuse.

[00:15:25] Jessica Infante: Well, while you're digging out on that snow, I'm sure you're thinking all about stone and Molson Coors because so are we. So where do we go from here?

[00:15:34] Stone Brewing: So we've got obviously the $56 million verdict out of the $216 million that Stone was seeking. There are a couple of things that you'd imagine that Miller Coors will be filing an appeal, but there are a couple of things that need to happen before that, including any sort of injunctive relief that Stone will seek. So that means a court order forcing them to presumably go back to something closer to the old branding with Key and Stone featured together a lot more prominently in ceasing use of, I assume, the Hold My Stones and the specific trademark usages that Stone objected to in the first place. The other thing they'll probably be seeking is an award of their attorney's fees, which can be difficult in the trademark context. You have to show that it's an exceptional case under what's known as the Lanham Act, which either usually involves some sort of bad faith on the part of the defendant or some type of unsavory or untoward behavior during the litigation in the prosecution of the case.

[00:16:37] Bianca Bruno: So we talked about this the last time you joined us, how these cases almost never get to trial. So could the fact that it made it this far make it an exceptional situation?

[00:16:48] Stone Brewing: No, it's more geared towards either some sort of bad actor or bad faith actions by either the defendant or defendant's counsel. And of course, it's impossible to say as I have been following the daily transcripts, but it is a difficult standard to meet. And I'd be surprised here if Stone was awarded attorney's fees. It is a sliding, like the court has a lot of discretion. So the court could say, you know, you're asking for two million or three million or whatever it is in attorney's fees. And they could say, well, we're only giving you attorney's fees for of this portion of the trial or this portion of the case or you had to work extra hard here because they threw up roadblocks here, here and here. So we'll award your attorney's fees times for for those portions of the case.

[00:17:32] Bianca Bruno: Gotcha. So what can we take away from the jury award? Because I know the last time you were with us, you said like kind of a worst case scenario for Stone is that the jury awards nothing. So they didn't do that, but they didn't award nearly as much as Stone was asking for. So what can we learn from this $56 million?

[00:17:49] Stone Brewing: I mean, I think it's gotta be considered a great success for Stone, just on a dollars and cents basis. They didn't spend anywhere near that amount of money prosecuting this case. So it certainly will show up black in the ledger. One thing that Miller Coors stressed in its releases and comments to the press after the case was that they didn't think there was any real confusion. And what really came out of the trial was that Stone owes its investors $400 million, which presumably is true, but that obviously didn't have that much of an effect on the jury, or maybe it had the opposite effect on the jury. This is why jury trials are so rare. Lawyers, by nature, are risk-averse creatures. If you're moving for summary judgment or you're having a judge decide, or it's a bench trial, there's more certainty there. You can more accurately predict what the court will do. When you're skidding it up to eight citizens to decide, it's a crapshoot. I couldn't have told you who would have won this case or if Stonewood would have gotten any sort of real damages, but they hung in there and they did.

[00:18:58] Bianca Bruno: So what do legal fees on a case like this run?

[00:19:01] Stone Brewing: It depends on the law firm you're using, how many attorneys are working on the case, how long the case is going on. Here, this case has been going on for three or four years, and at least Miller Coors was using attorneys from very large firms. It's certainly for both sides in the millions, and I'm sure Miller Coors is much higher, but I'm guessing Stone spent somewhere in the range of three to five million, maybe. Very rough figures, and then Millercore is more than that.

[00:19:34] Jessica Infante: Four years and 633 or 23 Pacer entries. That's a long case, and a lot of filings.

[00:19:44] Stone Brewing: Yeah, and I checked just before I got on here to see if any of the Vertica-related documents had been released yet, and they're still pending.

[00:19:51] Jessica Infante: we will all wait with bated breath on those. And we're also waiting to see sort of, you know, what Molson Coors does next. And I guess you talk about the reasons that these things never sort of reach a jury trial, because you sort of put it up to the wild card of, you know, eight or nine folks, sort of in the same regard, what factors do they weigh in a potential appeal?

[00:20:16] Stone Brewing: So they'll be picking apart the court's rulings leading up to the trial. They'll focus on maybe that there's some evidence that was allowed in that shouldn't have been or vice versa. And then also try to prove that, you know, no reasonable jury could have found this. So prior to closing your case, you move for judgment as a matter of law, where you sort of, in a summary form, say, you know, the court, we don't even need to let this go to the jury. Here are the reasons that, you know, there isn't any possible consumer confusion, or here's the reason that it should be found that we use stone as a standalone mark first, prior to Stone Brewing ever being formed. and the court usually just takes it under advisement and doesn't, and lets the jury rule. But afterwards, you know, on appeal, you know, both probably at the district court level and at the 9th Circuit level, they'll argue that that motion should have been granted. Just try to undo it. And obviously Stone will fight that as hard as they can.

[00:21:14] Jessica Infante: When would a judge say, you know, you have to put Key and Stone back together?

[00:21:19] Stone Brewing: It could be this week, could be next week. There'll probably be some additional briefings by the parties on that front, on the injunctive front, to determine what sort of order is entered and what Miller Cores will be required to do going forward. It also still could settle. Oftentimes, Even after you've won a jury verdict, there are still motivations to settle. Sometimes it's because there's uncertainty in the appeal, so you'll take a bit of a discount off the jury verdict in order to avoid the risk of losing an appeal. Sometimes it's because the other party might not be financially solvent, so you want to take what you can get. Here, that's probably not a concern because $56 million, well, nothing to sneeze at isn't going to put MillerCoors under.

[00:22:05] Bianca Bruno: How much appetite do you think there is for an appeal?

[00:22:09] Stone Brewing: I mean, there's probably quite a big appetite for an appeal on Miller & Coors' side. They've spent this much so far, however much they've spent, they've spent this much so far. The appeal is not a cheap process by any means, but it's really just filing probably two briefs. They file their appeal brief, Stone gets to oppose it, and then they probably have a short reply brief after that. and a relatively short oral argument, which will be held. But compared to what they've presumably spent already, it shouldn't be a crazy amount. And it's worth the investment if you stand a chance of undercutting the verdict.

[00:22:46] Jessica Infante: Is that a reason to sort of settle after the fact, knowing that they could appeal?

[00:22:53] Stone Brewing: Absolutely. The two prime motivators for settling after you've won are removing the risk of appeal and ensuring collectability.

[00:23:03] Jessica Infante: How much of being a publicly traded company would factor into that decision as well?

[00:23:09] Stone Brewing: That's a good question. I mean, I think they have a fiduciary duty to their shareholders to get the best deal they possibly can. So there'll be more scrutiny than there would be otherwise, because you'll have a lot of people following this and a lot of the information will be public as opposed if it was just a private company to be always handled with a confidential settlement agreement and without any concern of numbers or details leaking. But yeah, there'll be more transparency here. So we'll get a really good idea of how this settles if it does.

[00:23:42] Jessica Infante: And how long could an appeals process potentially play out over?

[00:23:47] Stone Brewing: It's different everywhere. We've still got to get to the end of this trial, but appeals can take months over a year.

[00:23:56] Jessica Infante: We received a press release too today saying that this is the fourth largest trademark infringement award ever. Could that possibly be correct?

[00:24:06] Stone Brewing: Yeah, it could be. I mean, trademark cases, damages can be tough to prove. Sometimes they're easier to get in cases of counterfeiting, like handbags, where there's no question that there's trademark infringement because you're literally counterfeiting a product to make it look like the trademark owner's product. It's easier to get large damages in those cases. But generally speaking, of all the types of intellectual property, trademark is probably the toughest to prove damages, especially extensive damages. And in patent cases, for example, there are statutory damages that are available. It's called a reasonable royalty, regardless of what sort of actual proof you can show of harm that you suffered. Whereas in trademark cases, there are no statutory automatic damages. You have to prove your harm or that you're entitled to disgorge the infringer's profits. So no, it wouldn't surprise me if that was true, if this was one of the largest verdicts ever in a trademark case.

[00:25:07] Bianca Bruno: Wow, it's crazy to me that all of this played out here in our beat. But Brendan, this has been awesome. I'm really glad you were able to hop on with us again, but what are you watching for to happen next?

[00:25:20] Stone Brewing: I'll be watching the appeal process closely, see if there's any talk of settlement leaking from either side. We'll be following the post-trial briefs very closely to get a sense of each party's strategy going forward. With regard to attorney's fees, I'm sure we'll see a motion by Stone and they'll complain that, rightly or wrongly, I can't say, but they'll assert that Miller Corp is sort of obfuscated and delayed and raised motions that they didn't really need to or that there wasn't a good basis for and use that as an argument to try to get some portion of their attorney's fees paid. And if they did, that would be a big victory. And then once everything is wrapped up at the district court level, we'll presumably see the party's appeal briefs filed at the Ninth Circuit. And theoretically, it could go to the Supreme Court, but that's very unlikely.

[00:26:18] Jessica Infante: Well, we'll be watching as well, but keep us posted as this thing progresses, please. Yeah, will do for sure. Thanks again for joining us, Brandon.

[00:26:26] Bianca Bruno: Yeah, thanks. Good to see you.

[00:26:28] Jessica Infante: Yeah, thank you for having me anytime. Our pleasure. All right. Joining us now is Bianca Bruno, a reporter for Courthouse News Service whose coverage of the Molson Coors Slash Stone trial you've all been reading. Bianca, thanks for joining us. Thanks for having me. So, Bianca, in your six years of covering courts, have you ever seen a case quite like this one?

[00:26:53] Molson Coors: I have covered some intellectual property IP and trademark issues. And this case actually reminded me of another pretty famous issue involving a household name in San Diego, and that was a trademark suit brought by Comic-Con in San Diego. And so I covered that trial several years ago, and the issue was kind of similar. another industry entity using Comic-Con San Diego's name, and that was the Salt Lake City Comic-Con. And the group in San Diego ultimately prevailed. And so that was kind of something in the back of my head when covering this trial the past few weeks.

[00:27:38] Bianca Bruno: That's really interesting. I haven't heard about that one, but Bianca, your coverage brought out a bunch of details about the state of Stone's business, which weren't, you know, new to us, you know, like we were telling you before we started recording, we knew about some speed bumps that have happened for the business in the past couple of years, but we didn't really know the extent. So, you know, according to Stone's execs and their testimony, the state of the business is kind of unstable. What are your big takeaways from this case?

[00:28:03] Molson Coors: I know kind of the big bombshell was the revelation that they owe their private equity firm over $460 million and that that has a deadline, a due date of next, I think next June, so in just about a year. And so that was kind of a big deal. I know folks in the industry were really surprised by, and even some, Watchers of the case who maybe were not fans of Stone suggested that that's part of the reason Stone brought the case in the first place was to try and recoup some money to pay their investor. I kind of found that argument to be a bit disingenuous. I think that they did legitimately bring a case and the jury agreed. But yeah, I mean, both co-founders of Stone testified during the trial. Greg Cook and Steve Wagner both confirmed that basically their businesses threatened that the success and the future of it kind of hinged on being successful in the trial. both because they want to reaffirm their rights to the name stone and their standing in the industry and, you know, this argument of what's in a name, but also because, you know, getting that verdict from the jury allows them to move forward and enforce their trademark rights and recoup losses related to that.

[00:29:34] Jessica Infante: You were there, you lived this through the three weeks that this trial went on. What was the mood that you sort of gathered right there in the courtroom?

[00:29:45] Molson Coors: It was a bit tense. It was a tense environment. You know, attorneys do what attorneys do. I'm not an attorney. I just cover what attorneys do in court for a non-legal audience. And I think both sides fought pretty hard for their clients. Part of the testimony and the cases that they put on did get a bit into the weeds of the beer industry. And I'm a court reporter and so I cover what happens in court in San Diego. I'm not a beer industry reporter like I know a lot of folks following the case are. So I feel like I had maybe a bit of a different take, a different approach in some of my reporting and just the things that stuck out that were interesting to me sitting in the courtroom. I do think a bit of it may have gone over my head and even over the heads of the jury and just proving trademark infringement. I think both sides had some interesting evidence of the use of stone. I think it was pretty compelling when Miller Coors put on their archivist who pointed to all these dozens of documented uses of the company's history of using the word stone to advertise Keystone Light, you know, basically starting in 1990, the beer came out in 1989. And basically a year later, they were referring to it as stone, but they never applied for the trademark, right? Stone Brewing owned the trademark. I think the way they told the story of, of picking the name Stone Brewing, and this was Greg Cook and Steve Wagner when they testified, It was interesting because they basically said, we wanted to follow the rules. We went to the library in downtown San Diego to look at trademark documents and see what the status was of Stone's use in the industry, that they wanted to play by the book. And so they were the owners. And so I think they showed trademark infringement.

[00:31:48] Bianca Bruno: Bianca, you mentioned you're a courthouse reporter. You don't really know the beer industry, but you've kind of become slightly famous in the beer world lately through covering this. But we've all been really impressed with your coverage. You grasp the nuances that come with the beer industry pretty well, because beer is a pretty eccentric situation. It's very complicated and it's hard to learn. But have you covered any beer-related cases before? And did you do anything to prepare for this?

[00:32:14] Molson Coors: We may have had a story, not beer industry, but beverage industry. The maker of the peanut butter whiskey, and now the name is escaping me. Screwball? Screwball had a similar case, I think, a few years ago. I don't know the status of it, but there are some industry people based in San Diego. You know, we're where we were at one point I'm not sure the status or what you folks think of it, but we were, you know, a craft brewing destination. It's not the top destination and so sure those issues kind of. converge in our community. I mean, I'm actually, I prefer cocktails over beer, but I know, you know, when I started covering the case, and I'm sure all the feedback you've gotten following it and covering it is, how could anyone confuse Stone Brewing for Keystone Light? They're just completely different. And of course, that was a legal argument that Keystone relied on pretty heavily in their defense was how could anyone confuse it? Audiences are different. The price points are different. And when I told my dad I was covering the case, he said the same thing. He was kind of a fan of Stone or he drinks it. And so to prepare, it was really just reading kind of the prior court documents they had covered. a bit of the case a couple years ago, but usually when they're going through the motions to get ready for trial and having their settlement talks and then doing discovery and all that, there's not a whole lot to report on. That's kind of behind the scenes. That's not part of the public record, but we did know I believe I had a story in 2020, I don't think it was 2021, but we knew at that point it was gonna go to trial because Judge Benitez had found that there are basically triable issues that have to be decided by a jury that he couldn't dismiss one way or another because there was kind of a factual issue of whether there was infringement or not. So that played out over the past few weeks.

[00:34:22] Jessica Infante: You were boots on the ground, though, and so the time you're sitting in the courtroom, did you have a sense of how it was going to play out? Did you get the sense that Stone had sort of won over the jury at any point?

[00:34:37] Molson Coors: I did not. I mean, the jury was, there were originally nine jurors the first day, and then one dropped off within one day. So the trial was decided by eight jurors. And I don't want to presume anyone's gender identity, but there were basically seven female presenting jurors and one man. And that wasn't something I reported. I don't know if anyone else reported that, but, you know, I'm sure that was certainly intentional on the part of the attorneys who are involved in selecting the jury. I'm sure part of their questioning was if the jurors were familiar with Stone Brewing or were fans, you know, since the trial was here in San Diego where they're located and have two pretty, you know, famous restaurants. I mean, I've been to them a couple of times. And so it was, you know, it was a bit tense in the courtroom. I mean, Greg Cook was there, I think the entire time, you know, and he testified and Steve Wagner testified. I don't know. I did kind of say earlier, I think some of the case may have gone a bit above the jury's head because it did above mine and I'm not an industry person. And so I think I had a different, approach and I think most of the evidence was compelling it to get a bit tedious when the parties were putting on their experts, which isn't unusual because experts get into the weeds in general. It's the nature of what they do, but I don't really think they needed the experts to prove trademark infringement, you know, they both both parties paid. I'm sure they spent, you know, a ton of money paying for these privately run, basically consumer tests of shopping and, you know, testing if if a consumer was asked to pick up Stone Brewing or a stone IPA, if they would actually pick the right beer, if they'd pick Keystone Light. I don't know that that would have been the compelling evidence that won the jurors over, but you just don't know. They were doing their due diligence.

[00:36:40] Jessica Infante: One of the things that stood out from your early coverage was that you, I think it was the first day you wrote that a lot of folks in the gallery were wearing stone shirts. Did that carry over to the rest of the trial? And I guess, was there any reaction from the judge to that?

[00:37:00] Molson Coors: There was not, and that's interesting you ask, because I do feel, you know, a judge could certainly say, hey, that's inappropriate in terms of maintaining a neutral kind of environment for jurors to use their best judgment in deciding a case. I could see a judge kind of calling that out and asking folks to leave. The folks from Stone were pretty much there during what's opening arguments and closing arguments. And that's when both parties usually have a big showing in general. And they both certainly did on the last day in terms of just, even their legal teams alone basically filled the entire courtroom. There were, you know, a couple dozen attorneys present, you know, most days, you know, Stone has name recognition in San Diego.

[00:37:52] Bianca Bruno: You mentioned that the jury was comprised of seven female presenting people and one male presenting person. And I'm really curious as to what jury selection was like. I've seen it happen. And like I know in voir dire, they can ask all sorts of questions. So were there any like fear related questions throughout that process?

[00:38:12] Molson Coors: I wasn't there when the jury selection happened, but I imagine that would have been the way it went, where they certainly would have asked, do you drink these beers? Do you know what this beer is? I'm sure they asked, have you been to Stone's Restaurant in Escondido or in San Diego and Point Loma? And some of those questions may have been or proposed questions by both sides may have been filed in the court record also, you know, ahead of time. But, you know, the jury selection went fairly quick. Judge Benitez kind of gave them. You know, two weeks basically to try the case and then a couple extra days and then allowed some time for the jury to deliberate so that it would take three weeks and they stuck pretty much to schedule. Do we know how long the jury deliberated? I know they deliberated all day on Thursday, and I think for two or three hours Friday. Friday they didn't come in until noon, so they were only there for about half day. And I think the verdict came out around three or four. So if they deliberated Wednesday late afternoon, it probably would have been for an hour. So I'd say they probably deliberated maybe about 10 or 12 hours.

[00:39:35] Bianca Bruno: In your experience, is that long? Is that quick? How does that feel?

[00:39:40] Molson Coors: I think that feels about average for a multiple week civil case with just a ton of evidence and testimony. I know the jurors did come to Judge Benitez with a couple questions on Thursday, I think for kind of some dictionary definitions. You know, when they give them their jury instructions, they're fairly long and, you know, they contain some legalese. They try to make them as easy to read and understand as possible. But I know the jurors did ask for definitions about at least one word that they had to kind of clarify for them as they were, you know, deciding what their verdict would be.

[00:40:23] Jessica Infante: Now that we've got a jury award, what are you expecting? What are you watching for next? Are you going to be following this case moving forward and do you expect an appeal?

[00:40:36] Molson Coors: I'd certainly expect an appeal. I don't know that the jury verdict will be appealed, but I know that Stone's already indicated they're going to ask for treble damages, which in California is something a judge can award, and it's basically triple the damages award that's supposed to be punitive and a deterrence. And so they they've already indicated last week they were going to ask that. So there's going to be several post trial motions. And I'm certain that if Judge Bonita is awarded those trouble damages, that would certainly be appealed to the Ninth Circuit. So I'd expect an appeal with that. Perhaps the jury verdict, although I don't know the kind of ins and outs of how they go about appealing it. And I know that Stone wants to enforce the trademark rights. So they've been, you know, they won trademark infringement. Now they want to enforce their mark that they own the rights to according to a jury. And I believe they also want to enforce it against other folks in the beverage industry beyond Miller Coors, and that includes some of the distributors. And so they've got kind of a long road ahead to prove just how much money was involved. I think they've estimated that And the time since they filed suit in 2018, Stone has said that Miller Coors made over $700 million selling Keystone or infringing cans of Keystone Light. And so they may try to recover that both from Miller Coors and other people who've made money selling the beer.

[00:42:19] Jessica Infante: Is there a hearing set next? Like, when do you expect this to sort of pick up again?

[00:42:25] Molson Coors: There's no hearing set as of right now. So I'd say within the next six months, there will be, you know, multiple post trial motions filed. There will be motions for attorney's fees. Those, I imagine, will be in the tens of millions of dollars. Those will be quite steep. And for trial costs related to the expert, you know, Stone's paying expert witnesses, they'll ask to be reimbursed for that. They'll ask to be reimbursed just for administrative expenses. So all that will be kind of in post-trial motions that both sides will have to brief, and then the judge will not likely decide during an actual court hearing, but probably just on the record. And then, of course, they'll ask for that extended damages award.

[00:43:16] Bianca Bruno: Bianca, were there any experts you testified that weren't included in your coverage? Anybody that brought up anything we maybe not haven't heard about?

[00:43:24] Molson Coors: There was an expert from Miller Coors who was there and his name is escaping me, but he testified, I believe the first week at the end of the first week and maybe into the second week of trial and he testified about. He still works for, well, now Molson Coors, which was, you know, kind of a strange thing to refer to Miller Coors and then Molson Coors, but I kind of stuck to referring to Miller Coors in my stories just for the sake of being consistent. So he works for, you know, now Molson Coors, but he's part of their marketing and advertising department and was involved in the rebranding of Keystone Light in 2017. And so he kind of testified to some of the internal documents they hired. You know, it's just incredible the amount of resources involved. They hired outside consultants and communications folks to help them with their rebranding campaign. And that's where some of those mock-ups for those billboards kind of teasing Stone Brewing came out of that documentation, because those were proposed by that third-party communication firm. And so he testified to that and just kind of the general thinking at MillerCoors. when they, you know, they basically had to revamp Keystone Light because it had lost $100 million in like the span of five years. So it was, you know, either, I'm sure it was make it, make it or break it time.

[00:45:06] Bianca Bruno: And now Stone's kind of in the same boat.

[00:45:08] Jessica Infante: That's right. And so one last question and we'll let you go. We get sort of sucked into our own little beer bubble and we can't see outside of it. And so, you know, this is popcorn GIF eating material for all of us. But how did this rate with the regular readers of Courthouse News Service?

[00:45:32] Molson Coors: I think it may have skewed our regular readership. I think it brought folks from the beer industry to Courthouse News that probably didn't know who we were or what we were. But I think people were interested. I think, you know, certainly people in San Diego are interested. I said earlier, Stone is kind of a household name here. I think they're held up as a kind of beacon of, of small business and independent business. And that goes for San Diego and then obviously craft beer industry wide. You know, they do a lot in the community here. They have restaurants and, you know, Stone's co-founders kind of testified to this and how their, you know, community gathering places locally and people just like that they're kind of the hometown success story. And so I think that kind of, you know, that that may have nailed home the idea of them owning their name too for the jury.

[00:46:29] Jessica Infante: Well we certainly ate up the coverage over here so we'll be looking forward to your future coverage and we can't thank you enough for taking the time out to join us. Please keep us posted too as things progress.

[00:46:41] Bianca Bruno: Yeah thanks for having me.

[00:46:42] Jessica Infante: Anytime.

[00:46:43] Bianca Bruno: Yeah you made our lives easy so thank you.

[00:46:47] Jessica Infante: And with that, we'll say that's our show for this week. Thanks to our one man audio team, Joe. Thanks to Jess for hanging out with me. Thanks to Bianca and Brendan for joining us. And thanks to all of you for listening. We'll be back next week.