Beer Brawl

Starbucks tries to step on the start-up of Starbock beer

For a guy who hasn't touched alcohol for the past five years, Rex Bell has had beer on his mind for a while. Specifically, the downtown Galveston bar owner has been thinking about a new brand of beer that he hopes to launch later this month at his eclectic Old Quarter Acoustic Cafe.

Bell, a witty, irascible musician who played bass guitar behind iconoclastic troubadour Townes Van Zandt and Third Ward bluesman Lightnin' Hopkins, struck a deal with Brenham Brewery to help create his new draft beer. A test keg of the brew, which has a reddish tinge and what Bell describes as a "hoppy" flavor, was a big hit with patrons, he said.

Last December, Bell and some friends were relaxing at his bar when he was inspired to name his beer. "I've always sold Lone Star and Shiner Bock draft beer. I mixed the two together and that was it. I said Starbock would be a cool name for a beer," Bell said. "A couple of weeks later I still thought it was a cool idea, and I applied for a trademark with the Treasury Department in February."

Plans progressed, and the trademark process was sailing along, until the situation suddenly changed in July. Another brewer -- one not even involved in producing beer -- had taken a keen interest in the small bar's efforts to create Starbock.

Starbucks Coffee Company weighed in with all the subtlety of its corporate-colossus status. All Bell had to do to make Starbucks happy was immediately drop his beer's name and destroy all materials containing images of its trademark.

Do that soon, the corporation ordered, or face "other necessary legal action."

He didn't.


Bell doesn't take well to intimidation. The crusty bar owner had operated the original Old Quarter bar in downtown Houston from 1966 to 1973, during the city's Texas music renaissance. After that, he thought he was out of the music business for good. But he reopened in Galveston in 1996, just around the corner from the island landmark, the Grand 1894 Opera House on Postoffice Street.

He also believed he'd complied with all the legal requirements in his quest for the new quaff. Bell sent a copy of his Starbock logo -- a blue star with red lettering surrounded by smaller stars -- to the trademark office. When the feds said he couldn't trademark the word beer, he took care of the problem by refiling one set of papers.

In fact, correspondence received by Bell earlier this month from the Trademark Assistance Center indicated his application was quickly reaching the final approval stage. It said that the government attorney reviewing his case found "no similar registered or pending mark which would bar registration" under the Trademark Act.

Starbucks thinks otherwise.

Julia Anne Matheson, the attorney representing Starbucks, responded to phone calls and an e-mail containing a list of questions from the Press by referring all inquiries to Starbucks headquarters in Seattle.

Matheson, of the law firm of Finnegan Henderson Farabow Garrett & Dunner LLP of Palo Alto, California, has sent several notices to Bell since May. Starbucks received its name and logo trademarks in 1997.

"Given the undeniable similarity in the appearance and pronunciation of the Starbock and Starbocks marks…Starbucks is understandably concerned that your use of the Starbock Beer mark will generate confusion in the marketplace as to the origin of the parties' respective products, [and] misappropriate the goodwill in the Starbucks Marks that our client has labored long and hard to establish," Matheson said in a May 22 letter.

Bell says he verbally sparred with Matheson in a phone conversation in July, during which he claims she suggested the name could be changed from Starbock to Bockstar. "Ms. Matheson said about ten times that I cannot win or I cannot beat them, and I said, 'I'm just trying to make beer, not win something.' I also asked her what she meant in her letters by settling this 'amicably.'

"She said 'amicably' is for me to cease and desist and destroy all items with the trademark and go away. I said, 'I'm not going to cease and desist,' and the last thing she said was, 'You'll be hearing from me.' "

For his part, Bell -- who likes to point out the fact that being a recovering alcoholic has not affected his ability to pour beer -- is puzzled that Starbucks has set its sights on a small bar. The coffee giant reported $3.3 billion in consolidated net revenues in a ten-month period ending in July. Old Quarter receipts on a typical night might barely buy a round of Starbucks decaf lattes for the Houston Astros.

"They think I used their name to come up with mine, and that's just plain wrong," Bell said. "They think the whole world revolves around their corporation. Maybe they can buy [the name] from me. I just want to make my beer and have them leave me alone."

Yet several Houston legal experts interviewed by the Press say that these kinds of trademark disputes do not often result in a stunning victory for the little guy.

In 1995, Becks Prime fast food outlets in Houston faced the wrath of Germany's Becks beer juggernaut. It wanted the local chain to change its name, saying the brewing giant had already claimed that trade name. Becks Prime and the German brewer reached a settlement that the burger chain would avoid using the word "Becks" without accompanying words such as "Prime."

The legal test in the Starbock fight is "whether an ordinary patron who came to his bar would think of an affiliation to Starbucks coffee, and wonder if Starbucks was now in the beer business," said Paul Van Slyke, a partner at Locke, Liddell & Sapp. "The large multinationals go after [a small operator] because if they let them get away, when they are confronted with a big infringement, the other company can defend itself by saying, 'You let all the small people get away with it.' "

Van Slyke knows firsthand of such litigation, having represented the estate of Elvis Presley in a successful case against the now-defunct Richmond Avenue bar The Velvet Elvis. It was ordered to change its name after a 1998 ruling by the Fifth U.S. Circuit Court of Appeals in New Orleans.

One Starbucks patron who seemed to back up Van Slyke's notion is Karmen Robertson, a first-year medical student at the University of Texas Medical Branch at Galveston.

"I would expect [Starbucks] to do something like that. I mean, Starbock is like taking advantage of a name that's well known and trying to capitalize on it," said Robertson. On a Tuesday afternoon, she was sipping on a mocha frappuccino while doing her anatomy homework, as one of a handful of customers at a newly opened Starbucks only four blocks from the Old Quarter.

"Ten years ago when you said the word coffee you thought of Folgers. Now you think Starbucks."

Paul Janicke, a University of Houston law professor who specializes in trademark and copyright issues, said that only a small percentage of these cases get to trial. "There are about 4,500 trademark actions a year, and only one in a hundred proceeds to trial because the plaintiffs are in the right most of the time," said Janicke.

"That's because the economics of these situations are usually lopsided when the corporation's finances are enormous and the accused infringer has small assets. A case like this can ruin a business because it occupies the owner's attention. The real test of these questions is whether [Bell] is ornery enough to see it through."

Starbucks reinforced its stance in an e-mailed response to a Press inquiry, as spokesman Lara Wyss spoke of the company's resolve to sink Starbock.

"Even where it may seem playful, this type of misappropriation of our name [and reputation] is both derivative and dilutive of our trademark rights," she said.

As for the feisty bar owner, he can sound like President George W. Bush making that infamous "Bring 'em on" challenge to Iraqi militants.

"They got me going," Bell says. "The fact that they've threatened to sue me has lit a fire under me to make [selling the beer] happen even faster."

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