Who Owns Red? Maker's Mark and Jose Cuervo Fight It Out

(Photo: Joe Shlabotnik)

A few months ago we wrote about whether shoemaker-to-the-stars Christian Louboutin ought to have a monopoly over red shoe soles. Last week, in Kentucky, a similar issue arose concerning red wax. The red in question was on the neck of bottles of booze—specifically, Maker’s Mark bourbon and Jose Cuervo’s Riserva de la Familia tequila, which both feature a bottle cap seal made of red, dripping wax (Cuervo has since shifted to a straight-edged red wax seal).  Maker’s, which used the dripping wax seal first, sued Cuervo, claiming trademark infringement.

The dispute is interesting because we like to drink bourbon and tequila it highlights two things about brands in the modern economy.

First, trademarks are not limited to words, like Nike or Apple, or symbols, like the swoosh or the apple-with-a-bite-missing. Increasingly, they are baked right into the product (think Louboutin’s red soles) or fall halfway between product and packaging (the dripping red wax that adorns all the tops of bottles of Maker’s Mark). In a global economy with diverse languages, symbolic branding like this can be especially valuable.

Second, the dispute highlights the complex economic relationship between aesthetics and function. In the case of the Louboutin shoes, the court held that Louboutin did not have a lock on red soles because red soles were actually “aesthetically functional”—that is, color is one of the things that gives a piece of apparel a competitive advantage in the marketplace.

The same may be true for liquor, but we think to a much lesser extent. While the look of a bottle of liquor is significant—witness the great diversity of bottle shapes and logos, including vodka in a bottle the shape of a human skull–ultimately taste trumps (we hope).

So as the court in the Makers Mark/Cuervo dispute declared, competitors are not really put at a disadvantage if they have to use black or green wax to seal their bottle caps. Port wine shippers have been using black wax seals for decades, maybe centuries. For high-end shoes, on the other hand, looks are much more central, and the consumer’s desire for a certain color in a shoe much more likely to drive consumption decisions than the color of wax on a liquor bottle. Hence in the fashion context, the potential harm from granting one competitor control over a color is much larger.


Mike B

So if wax color can constitute a trademark what is the maximum number of whiskey brands the law will allow before the spectrum is exhausted?

When a company has to go to these lengths to protect a trademark is a single that their product isn't distinctive enough on its own. A friend of mine said that back in the 1960's Maker's Mark was considered to be a "cheap" whiskey. It's still a cheap whiskey today, but its branding and marketing gimmicks has encouraged people to pay a lot more for it. And silly me I always thought trademarks were supposed to help consumers make better decisions.

David

@Mike B 1) Trademarks are meant to protect the company, not consumers. 2) The spectrum is infinite. 3) Marketing gets people to buy something once. Taste keeps them coming back.

DanSanto

David - the spectrum may be infinite, but the shades of color the human eye can distinguish is not infinite. If it gets broken down even further into clumps of color that are easily distinguished without a careful side-by-side comparison, then there are even fewer colors.

However, that still leaves several hundred different colors. Take color, shape, and texture into account, and I agree that they won't ever run out of bottle-top designs.

DanSanto

"While the look of a bottle of liquor is significant ... ultimately taste trumps (we hope)."

Ha! You wish. I have bought many a bottle of wine based on the look or clever name of the label. I've made some great finds that no reviewer has every mentioned. One may hope taste triumphs, but outside of picking my known favorites, the label's look determines my picks.

Liquors have a lot less variety than wines, and the labels aren't quite so prominent (at least according my own preferences) but I've picked up some bottles of whiskey just because they have a really nice-looking glass bottle. It's not my favorite whiskey, but the (cool-to-me) dripping wax seal on Makers Mark has probably been a factor in my selection.

Tom F

I won't buy another bottle of Maker's because of this.

J1

Because of the lawsuit, or because it's considered cheap whisky?

Lawrence

How exactly does the wax "fall halfway between product and packaging (the dripping red wax that adorns all the tops of bottles of Maker’s Mark)"? Isn't it entirely packaging? I don't question that packaging is a big part of any brand, and will of course influence purchasing decisions, but what is it about the red wax that transcends the product/packaging barrier?

Clancy

Maybe the wax is edible and delicious?

Eric M. Jones.

How about us color-blind people?

Kazzy

Does the randomness of the design matter? It would seem to. It'd be one thing if MM used a specific design to the wax seal. But they don't. It's just slathered on there. Them claiming the wax seal would be like Nike claiming any pen stroke because of the Swoosh.

Oliver

I think the really interesting thing here is that something completely and utterly obvious as a red wax seal can be trademarked. Historically, red is THE color for sealing wax. What's next? A company trademarking metallic-colored screwcaps? Or clear glass plugs?

LT

For what it's worth Royal Mail in the UK have a similar trademark - much of their stationary contains the following:

'Royal Mail, the Cruciform and the colour red are registered trade marks of Royal Mail Group Ltd'

Though I'm not aware of them suing anyone over it.

Chuck Cain

Color can be a trademark per US Supreme Court. cf http://www.law.cornell.edu/supremecourt/text/514/159

In the case above, both companies were making the same product. The color distinguished one manufacturer over period of time and would cause confusion in the market is another manufacturer were allowed to use it. With Makers Mark/Cuervo the consumer presumably knows whether he/she is buying bourbon or tequila, so no confusion will result.