The Trademark Trial and Appeal Board (TTAB) has ruled that a Ternura brand of cigars is confusingly similar to Ternura tequila, dubbing the two types of product as “complementary” and linked in the minds of consumers, according to Law360. The board affirmed a decision to refuse registration of “Ternura” as a trademark for cigars, citing an existing registration for tequila held by a California company called Don Francisco Spirits LLC. The board reasoned that because alcohol and tobacco are commonly sold by the same entity and they are complementary products marketed together for simultaneous consumption with identical trademarks, the marks were confusingly similar. “Whiskey and cigars are closely related in distribution and use,” the Fifth Circuit wrote. “Hotels, restaurants and bars supply cigars as well as whiskey to their guests and customers. People frequently smoke cigars while drinking whiskey.” The boards ruling signals a broadening of the channels of trade and streams of commerce one must evaluate in determining the strength of a trademark.  The case is:  In re El Galan Inc., case number 86961428, in the U.S. Patent and Trademark Office’s Trademark Trial and Appeal Board.

Posted in alcohol beverage law, Lawsuits | Tagged cigars, Trademark, ttab | Comments Off

The Illinois Liquor Control Commission (ILCC) is meeting today to discuss next steps regarding illegal shipments of alcohol into the state from out-of-state retailers, according to the Chicago Sun-Times. This is follow-up from the December ILCC cease and desist letters sent to almost 1,000 liquor stores around the country.  “The illegal direct shipment of alcohol into the state of Illinois is something that the Illinois Liquor Control Commission takes very seriously,” noted a statement from the ILCC quoted in the Sun-Times. “The cease and desist letters are a continuation of enforcement efforts by the Illinois Liquor Control Commission as we look to halt the shipment of alcoholic liquor from unlicensed sources into Illinois.” The issue is not only direct shipments to consumers, but also Illinois liquor stores receiving alcohol from out-of-state. According to the Sun-Times, one store maintained a “front door register” for normal retail business and a “back door register” for sales to Illinois liquor stores. The result: lost tax revenue for the state.

This week a Tenth Circuit panel reversed and vacated an arbitration decision that had previously exempted an Oklahoma tribe from $27 million in alcohol sales taxes.  The case began after a 2014 tax audit was launched by Oklahoma tax authorities, according to Law360, after the tribe asserting $27 million in tax exemptions for sales tax on alcohol served to nonmember casino patrons. The state questioned the exemptions, revoked alcohol beverage permits for the casinos and, according to Law360, threatened to close the casinos and other businesses for allegedly failing to report sales tax collections, thus, prompting the tribe to bring the arbitration. The Tenth Circuit held that a tribal-state gaming compact with an arbitration provision contingent upon the availability of de novo review was unenforceable and conflicted with the Supreme Court’s decision in Hall Street Associates v. Mattel. In Hall Street, as reported by Law360, the Supreme Court held that the Federal Arbitration Act prevents parties to an arbitration agreement from contracting for de novo review of an arbitration award.