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Last week I wrote about the wonderful revelations that are entering the public record thanks to the trademark lawsuit in federal court between San Diego craft brewing pioneer Stone and Molson Coors, maker of Keystone Light. Well, the trial is now in its third week, and continues to deliver. Intellectual property/beer attorney Brendan Palfreyman has been doing (Palfre)yeomanly work clipping trial testimony and relevant coverage from Courthouse News, and has surfaced more morsels from the proceedings.1 

My personal favorite so far is the apparent acknowledgement from Molson Coors’ CEO Gavin Hattersley that Keystone Light is brewed from the “aftermath of Coors Light.”

Depending on where/when you went to college, this may ring a bell. For least two decades, shitheads across the land have passed an urban legend around scummy frat houses and condemned mods that Keystone Light is just Coors Light that didn’t pass quality control. “Is Keystone Light really divine intervention or simply the Coors Brewing Company’s method of damaged goods disposal?” wondered a student journalist in Syracuse’s Daily Orange in 2006. A 2011 reddit thread covers similar ground:

There are a bunch of other blogs2 to this effect published from the early Aughts to the early Teens, and I myself heard a version of this rumor when I was in college in both Vermont and Virginia, which would’ve been right around that same period. Now we have court records that apparently confirm at least part of the myth—that Keystone is brewed with some byproduct/“aftermath” of Coors Light.

I say “apparently” because Courthouse News’ write-up doesn’t have Hattersley explicitly confirming this assertion from Stone’s lawyer; in fact, he basically claims he doesn’t understand how beer is brewed… like, in general, an implausible gambit that nevertheless kicks ass. Even if Hattersley confirmed Stone’s lawyer’s statement, it still wouldn’t account for the whole “dented can” thing. Where did that come from? Hmm!!!

If you’ve got any info on this, American collegiate life’s lowest-stakes mystery, by all means share with the group:

Regardless, it is now entirely conceivable that the jurors on this trial will find themselves deadlocked over an urban legend that apparently oozed forth from the cosmic slurry of coed overconsumption in the early Aughts. Can you imagine how fucking mad you’d be if you were one of those nine souls? Just getting increasingly red-assed at your fellow jurors while you text your significant other insane shit like:

I don’t know if jurors are allowed to text these days but you get my point. Anyway! Also emerging from the Stone/Keystone trial so far:

• Stone’s lawyers presented a reddit thread to demonstrate to the jury that customers were confused by Keystone’s rebrand;

• Stone’s expert witness calculated Keystone’s rebrand had increased the surface area occupied by the “STONE” part of its wordmark by 1600%;

• Stone’s president (and cofounder/original brewer) claimed that unless the company receives sufficient damages to offset its alleged losses from Keystone’s rebrand, the company will go out of business;

And on, and on. Palfreyman’s whole thread is here; he was also on Brewbound’s podcast talking about the trial in more depth the other day. And by all means, read journalist Bianca Bruno’s Courthouse News coverage of the trial (which somehow isn’t paywalled, upending everything I thought I understood about the economics of niche legal reporting.)

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💀 Murdered darlings: taproom troubles 'n triumphs edition

I just published a story at VinePair about the challenges of operating brewery taprooms in the era of pandemic disruptions, industry maturation, and increased competition. I’d been thinking about this piece for awhile, but upon hearing the news of Modern Times Beer’s new CEO’s decision in mid-February to shutter half of its taproom locations and retrench its home-market business in Southern California in hopes of righting the debt-laden ship, I figured it was time to actually report it out. I’m glad I did—while Modern Times’ stumble appears to be an unfortunate-but-straightforward case of over-expansion, underwhelming growth, and extremely poor timing, compounded by some maybe-too-fancy build-outs along the way, it isn’t necessarily reflective of the industry’s on-premise aspirations at large.

That’s good news for breweries like Hi-Wire of Asheville, North Carolina, which has almost a dozen locations across the Southeast and lower Midwest either already operating, or in process. It’s also good news for people who enjoy drinking at taprooms, of which your fearless Fingers editor is most certainly one. I hope you’ll check out the full piece for more detail, because there’s a lot in there. And as usual, here are a few “murdered darlings” from the reporting process—i.e., interesting insights and quotes from sources that didn’t make the final cut, printed here for the Fingers Fam’s reading pleasure.

The quotes below have been lightly edited for length and clarity.

— Paul Reiter, cofounder and CEO of Great Notion Brewing, on how the brewery’s custom app has helped drive repeat business to its taprooms:

Right away when the pandemic started, people didn't want to come out and wait in line for two hours, plus it wasn't safe. No one knew what the hell was going on in the beginning. So the cool thing about our app when we first launched it was, Alright, pre-pay, buy your beer now, and you have until we close the following day. So you had almost like 48 hours to come pick it up. People would still come and wait in line… It’s just like buying a pair of Jordans at 7am on the Nike app. They would buy our drop when it first hit like at 9am, and then they would come and wait in line [to pick it up] at noon. And it would be packed! We kept trying to communicate that people didn’t have to do that. [Laughs] But that’s the biggest synergy [between the app and the on-premise locations], people can prepay online and then come in-person to pick it up if you don't want to pay like a shipping or delivery. So then they'll come in and have a beer and a burger later in the day or the next day. And for people who just walk in off the street to our locations, we advertise the app.

— Michael Uhrich, the founder and chief economist at the industry consultancy Seventh Point Analytic Consulting, and the former chief economist of the Beer Institute, on brewery-operated taprooms vs. restaurants and bars:

For most purposes, these are restaurants and bars. In most of the country, on-premise has opened back up, at least in some form… For most purposes, those prohibitions on selling on-premise are largely gone. But the pressures keeping people from spending money on-premise are largely still there. Inflation is very high right now, and many households need to spend money differently. That means going out less. So what's holding back on-premise performance now, I think is less about people being prevented from going into bars and restaurants, or even necessarily from being afraid of getting COVID, and more about economic concerns…

I think that restaurant and bar success and failure affects [the beer] industry really directly, but we don't talk about it a lot unless the restaurant or bar is owned by a brewery. We’ve talked a lot over the last months about [various brewery taproom closures], but we haven't talked about the slew of other restaurants and bars that are struggling if not closing as a result of both the pandemic itself and its ensuing economic stress. I think those conversations are necessarily linked.

— Chris Shepard, a senior editor of Beer Marketers Insights, on the enduring economic development appeal of craft breweries in small and mid-size cities:

There aren't as many headlines as there were five to eight years ago on this, but cities still see craft breweries as economic drivers, including craft brewery taprooms, that they want on their Main Streets. And they’re still willing to to offer tax incentives and various and sundry other things to make their community an attractive choice to brewery entrepreneurs. That still happens. You’re not seeing the Ashevilles of the world court the Sierra Nevadas and New Belgiums of the world anymore to build monster breweries. Those opportunities just aren't there anymore. But I still frequently see headlines about small towns or even medium-sized towns and cities being excited about breweries opening locations there, because they see it as attractive to the kinds of community members they want to attract.

— Chris Frosaker, a co-founder of Hi-Wire Brewing, on the supply chain issues posing challenges to their taproom opening schedule:

Believe it or not, staffing has not been an issue for us… The biggest hurdles now are COVID-related manufacturing delays. Our Charlotte location that's under construction right now for example: our like rooftop HVAC units and glass garage doors, believe it or not, are on super-long lead times. So just because of those two thing, that’s pushed us back a few months. That’s kind of the hardest thing, being really flexible about materials we use such as tile, paint even. You know, trying to order something and hearing like “Oh, it's on backorder for eight months.” Well, that's not gonna work, because I want to open in four months. Just rolling with the punches on the construction side is really the hardest part.

— Bart Watson, chief economist of the Brewers Association, comparing independent breweries’ taprooms now to brewpub chains last decade:

It feels a little like we're replaying some of the challenges around brewpub chains. I felt like we learned with brewpub chains. These things are harder to scale than a lot of people get credit for it… scaling these small hospitality outlets in a way that is consistent is challenging. Even the best operators have struggled with this, not just during COVID but over the last five years. So some of what we might be seeing is growing pains. It's really hard to run a network of hospitality outlets, and you know, and we have an example of this in brewing over the years. I don't know what the kind of takeaway there is; taprooms are probably simpler to run than brewpubs because they don’t have the kitchen piece. There's some extra simplicity there. But this model has been tried before: it was called the brewpub chain, and and it never really took.

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