In its lawsuit, Grayton Beer levels allegations of breach of contract and copyright infringement over its signature “Beach Blonde Ale” and has asked the court to limit 3 Daughters’ distribution of their same-named beer to outside the Florida Panhandle markets.
PANAMA CITY — A battle is brewing in the federal courts.
At stake: rights to use “Beach Blonde Ale” as the name of a beer in local markets.
Santa Rosa Beach-based Grayton Beer Co. filed the lawsuit Feb. 9 in the U.S. District Court for the Northern District of Florida against St. Petersburg-based 3 Daughters Brewing Co. In its lawsuit, Grayton Beer levels allegations of breach of contract and copyright infringement over its signature “Beach Blonde Ale” and has asked the court to limit 3 Daughters’ distribution of their same-named beer to outside the Florida Panhandle markets. Grayton Beer also is asking for a jury trial to determine damages for a loss of sales to 3 Daughters, according to the complaint.
An exact amount of sought damages has not been explicitly announced. The minimum claim of damages in federal court is $75,000. A jury, though, could award more or less, or they could side against the plaintiff.
Attorneys for both companies held a conference call Thursday to discuss the case with U.S. District Judge Robert Hinkle. The parties discussed a timeline for an injunction against 3 Daughters selling their product in Grayton Beer's markets.
Mike Harting, CEO of 3 Daughters, said more meetings are scheduled in the coming weeks and he is hopeful both sides can come to an out-of-court agreement.
“We are a passionate bunch,” Harting said. “Hopefully cooler heads will prevail and we can work it out as business people.”
What that would entail, Harting declined to say, as negotiations are pending.
In the lawsuit, Grayton Beer claims it laid the groundwork of name recognition in the area and 3 Daughters is capitalizing on it, despite the two companies initially agreeing to not compete.
“In using the ‘Beach Blonde Ale’ trademark, (3 Daughters) is misleading the public into believing that its product is provided by or affiliated with Grayton,” the lawsuit states, “thus depriving Grayton of the benefits of the goodwill attached to its product, and confusing consumers since the products themselves are different.”
Origins of the litigation date back to late 2013 and early 2014.
3 Daughters began selling its Beach Blonde Ale in December 2013. Grayton Beer began selling its Beach Blonde the following month, the lawsuit states.
Before that, however, Grayton Beer had been working for years to establish a customer base across the Southeast U.S. with various craft-brewed beers, targeting visitors of Walton County and Panama City Beach. The company then began expanding its distribution to neighboring states before learning of a California-based company that had held the trademark for “Beach Blonde Ale” since 2007. Desiring to avoid a legal conflict, the two businesses reached an agreement under which Grayton Beer would not challenge the California company’s rights to the name in court if Grayton Beer could continue to use it in the Southeast U.S., the lawsuit states.
As both Grayton Beer and 3 Daughters grew their markets, the two reached a similar agreement via email, stipulating the Apalachicola River would delineate their competitive boundary. However, after the death of 3 Daughter’s owner in late 2016, Grayton Beer claims the competing Beach Blonde Ale began to show up at retailers as far west as Miramar Beach, the lawsuit states.
Harting disagreed, saying there had not been an agreement beforehand.
When Grayton Beer demanded an explanation, 3 Daughters allegedly responded that it had acquired legal rights to the name by buying the trademark from the California brewery and would be selling their Beach Blonde Ale in West Florida.
That, Grayton Beer claims, was a breach of contract and trademark infringement, which cost them sales. The company also has asked the court for an injunction against the sale of other Beach Blondes until the case can be resolved. Hinkle has yet to weigh in on the request.
There are six craft breweries operating in the Panhandle, according to VisitFlorida.com, including Grayton Beer.