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Critical Drinking

Critical Drinking — Why the Lagunitas Lawsuit Matters

And it really fucking matters. If you’re not up to speed, Lagunitas filed a trademark lawsuit against Sierra Nevada for the way they treated the letters “IPA” on their packaging. Not the use of those letters, of course, but their graphical treatment, which is a very difficult but important part of trademark law to defend. Lots of subtleties involved. 

The Lagunitas Chicago brewery, which will eventually run at a 1.2MM barrel capacity, twice the capacity of its original Petaluma location. 

The Lagunitas Chicago brewery, which will eventually run at a 1.2MM barrel capacity, twice the capacity of its original Petaluma location. 

Today, Lagunitas founder Tony Magee withdrew the lawsuit amidst an outpouring of consumer anger. Some folks saw the grounds for the lawsuit plain as day (blocky typeface, black lettering, and the kerning of those letters). Others thought it was reaching at best, and disingenuous and inflammatory at worst. Still others pointed to the huge sums of money involved in defending your share of the IPA marketplace as perhaps the most obvious motivation behind the suit. Which is to say: Lagunitas employing an anti-competitive, corporate tactic, and using the courts instead of its product to best a competitor. 

All those possibilities are interesting and hold more than a modicum of truth. Lagunitas spent what is likely a small fortune for most brewers conducting research before filing the lawsuit to gauge potential consumer confusion before filing the suit. But that’s not what matters most about this lawsuit. What matters most is that Lagunitas dropped it. Not because they were losing in the courts (it never got that far), or because they saw the error in their claims, but because consumers shamed them for doing it at all. And that shame was too much for them to handle. Or at least, it’s really hard to keep building towards 1.8M barrels of beer, making huge legal moves to go after your competitors, and continue acting like you’re the wake-and-bake underdog. For many consumers, this is the stuff of big beer. 

Aside from the trademark lawsuit, there have been a number of recent behaviors that have folks like me questioning the ethos of Magee, and the authenticity of his humble stoner persona. There seems to be a willful ignorance in some of his hypocrisy. 

This past fall, we heard Magee complaining about breweries, namely New Belgium, for taking taxpayer money in the form of incentives to open breweries. He was proud to be funding his own brewery his own way and not taking taxpayer money. Chiding others, he said: "We are becoming the people we set out NOT to be. No incentives for us in IL." Magee seemed proud of his bootstrapping nature and it was an easy sentiment to get behind. But this past month, we learned that Magee made a significant financial contribution to local Chicago politicians and their re-election campaigns, including the incredibly controversial Rahm Emanuel—who many claim is gutting our public education system.

In a series of tweets, Magee defended himself, saying: "I'm not political, but I know how to b grateful. I'm not political. If one wanted to hate me, hate me cuz I've never voted in my adult life. I support things that support us......guess I could say I'm sorry if it seemed wrong, but they all stood shoulder to shoulder with's complicated, right? Cheers all...I did it cuz I truly love Chicago and its brawling nature." 

Update: the following paragraph has been edited to more accurately reflect Magee's statements about the Goose Island Elk Mountain trip. Thanks to Chris Furnari of Brew Talks for supplying the video that confirms Magee's statement (Magee claimed it was a "made up anecdote" on the Chicagoist), but also provides a more accurate description of his statements. 

During a recent Brew Talks session held at the Lagunitas taproom in Chicago, Magee spoke dismissively about Goose Island inviting journalists out to their Elk Mountain hop farm (something AB has done periodically over the years). Perhaps it was a fair criticism of traditional and explicit press junkets, and I say that as one of the dozen or so journalists who chose to go. Gifts, especially if they go unacknowledged, can undermine a writer’s credibility and win the favor of critics. We certainly acknowledged it, and wrote our report without any interaction from AB or Goose Island, as did a few others. In fact, it’s the law that a journalist has to disclose that relationship, and AB enforces it through agreements beforehand.

But Magee's statement came only months after Magee's own team flew journalists across the country to the Petaluma location for the Fusion #19 project when they were working with bands in the run-up to SXSW and their Couch Trippin’ tour. (I was one of the journalists on that trip, too, and it was just as explicitly a press junket, though we've yet to share a story from that trip.) But instead of ensuring that journalists were on the up-and-up, folks from Lagunitas would offer you a joint on the way to the brewery in the morning. And periodically while you were hanging out at the brewery all day. And again on the way back to the hotel at night. They’re so chill. They make sure people know they like weed with the same dedication that a political party or corporate brewery has to a new marketing message. In the end, it’s pretty much the same thing. 

Today, Magee describes his legal process against Sierra Nevada like so: "I don't know every answer beforehand, so I feel around for the edges and try to learn." Perhaps he has a very short memory, is too disconnected from that the actions of his own company (getting big is challenging!), or simply can’t connect the dots between his own actions and those of his similar-behaving competitors that he finds so detestable. Should his wandering education come at the expense of breweries like Sierra Nevada? His charming "aw, shucks" defense rings more hollow than ever. 

Craft beer consumers are a unique lot. That's why I love them so much. It’s one of the few products where a purchase is seen as a political statement, or support for your favorite sports team, or buying in to an indie-band culture, or an investment in a future that’s better than the past. And on the backs of these many, many dollars, we’ve helped build some truly large companies. Those companies can use that money however they wish (we got our beer in exchange already), but it’s important for them to realize that we weren’t just buying their beer—we were investing in them towards a better future for beer. We were casting votes. We were entrusting them to push our values forward and defend our ethos. I've often said that no brewery should feel beholden to a sub-culture—the rare beer geeks and trading clubs are not your real customers in the long-run. But the center of craft beer culture is a sacred voice. 

The sentiment that “brewing is a business” gets thrown around a lot at times like these. Those throwing it around seem to think that by condescending to consumers as if they don’t understand the economic nature of their favorite industry somehow makes them more intelligent or hip or edgy in their cynicism. Now, it’s true there’s plenty of naiveté on the part of the craft consumer at times—even the professional consumers who should understand how breweries actually make money and build brands. But don’t ask for the elimination of their naiveté at the expense of their optimism. Craft consumers may not understand all the nuances of how the beer business works, but they know it’s sucked, for a long, long time, and they’ve poured millions upon million of dollars into a better future for beer, betting that craft brewers can make a better capitalist structure based on cooperation and innovation even as their hope for a better government wanes. I'm actually proud of the way craft consumers are defending their values in this case—it tells me that they're making qualitative decisions about the breweries they support, not just looking for the word "craft" as an easy out. This is a sign of sophistication, not naiveté.

Not every brewery owner signed up for this responsibility, of course. And those working beneath them have their own views—many of my friends at Lagunitas are incredible patriots for craft beer. I don’t envy the pressure either way. The narrative of Lagunitas is a political and emotional one that has resonated with its customers for more than 20 years now. Your dollars have helped give them a business (an aggressively growing one, at that!), and now that businesses is gaining power. How they use that power should reflect the values of the customers attached to those dollars. Or not, I suppose. It’s a free enterprise. But there will be consequences. Because the passion that makes craft beer consumers so desirable in those early, lean days, is the same passion that will turn them against you if you violate their trust on your way to becoming the next big, corporate brewer.

It may be awhile before someone like Lagunitas ever hits the 6M barrel mark and loses their craft brewer designation from the Brewers Association, but what the last couple days shows us is that before you ever lose the designation, consumers will strip you of the honor themselves. 

UPDATE: A number of readers wrote in to ask about the other two Lagunitas conflicts relevant to how they handle competition: the SweetWater 420 trademark debate, and the dust-up over Sam Adams targeting Lagunitas' IPA. 

We didn't include these in the story—not because they aren't relevant (they certainly are), but because that news has been around for awhile now and we were recounting more recent events. Suffice to say, the pattern of hypocrisy goes back a long way. If you'd like to learn more about how Tony Magee reacts when someone sues him for their trademark, or the things he says when a competitor targets him in our open, capitalist marketplace, those links will take you to quality coverage of the scenarios. 


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Words + photos
by Michael Kiser