What does the word “beer” mean? Is a hard seltzer a beer? These are the questions U.S. District Judge Lewis Kaplan ruled on Tuesday must be left up to a jury.
The question arises in a dispute between Modelo (Anheuser-Busch InBev) and the company that distributes its Corona beer in the United States, Constellation Brands. Under the parties’ trademark licensing agreement, Constellation may use the Corona trademark to sell beer. Modelo asserts that Constellation instead sold Corona-branded hard seltzer without its permission in violation of the agreement.
The seltzer Constellation is selling in the U.S. is Corona Hard Seltzer, an alcoholic beverage made with sparkling water and various flavorings. According to the publication Food & Wine, hard seltzer can be produced in a brewery like beer but does not contain barley or hops, two important beer ingredients.
Constellation argues that the term “beer” in the agreement also encompasses hard seltzer, but Modelo disagrees, arguing that the plain meaning of the word can be found in a dictionary and that the dictionary definitions of the words “beer,” “malted beverage,” and “version” exclude the type of seltzer products Constellation is selling. It also argues that no reasonable jury would find that the definition of the word “beer” in the agreement includes such products.
Judge Kaplan denied Modelo’s motion for partial summary judgment, ruling that the meaning of the word “beer” in the agreement is ambiguous and cannot be decided at the summary judgment stage. It must therefore fall to a jury to decide, noting that “Modelo has more dictionaries on its side,” but dictionary definitions alone cannot resolve an ambiguous contract term.
Additional Reading
Jury must define ‘beer’ to resolve Corona seltzer trademark case, judge says, Reuters (December 14, 2022)
Is Hard Seltzer ‘Beer?’ A Legal Battle Over the Definition Is Being Fought By Two Brewing Giants, Food & Wine (May 19, 2021)
Modelo v. Constellation December 13, 2022 Memorandum and Order
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