Walmart Finds "Trouble" with House Beer Line

Austin Ray

THE GIST
Retail giant Walmart is being sued for allegedly marketing its in-house line of beer in a “fraudulent, unlawful, deceptive, and unfair” manner. Specifically, the suit claims the company has been pitching its Trouble Brewing portfolio to the public as “craft beer,” despite being mass-produced by a non-craft brewer.

“[Walmart’s] Craft Beer has never been a ‘craft beer,’” the lawsuit claims. “Rather, it is a wholesale fiction created by the Defendant that was designed to deceive consumers into purchasing the Craft Beer at a higher, inflated price.”

Walmart only introduced the line in early 2016, though the beers are now available in 3,000 stores in 45 states, according to the Washington Post. Reached for comment, a Walmart spokesperson tells GBH, “We have not yet been served, but we take these claims seriously and will respond appropriately with the court.”

WHY IT MATTERS
If you’re experiencing déjà vu right now, it’s not a glitch in the matrix. Just two years ago, a California man lent his name to a lawsuit against MillerCoors for deceptively marketing its “craft” flagship Blue Moon in a similar manner. That case was ultimately dismissed with prejudice by a federal judge, who agreed with the beer behemoth’s defense that no “reasonable consumer” would be deceived by the company’s representation of the product as “craft beer” or having been “artfully crafted.”

Which begs the question: Is this lawsuit the same thing, only aimed at a different corporate giant? The lawyers representing the plaintiff say not so much. “We are familiar with [the Blue Moon case], and we do think it’s different,” says Bryce Lenox, attorney partner at Giles Lenox, which filed the suit in Hamilton County, Ohio last week. That said, Lenox declined to elaborate on the differences because doing so would help Walmart, no shit, “craft” its counterargument.

Fair enough. But comparing the two lawsuits side by side, there are some striking similarities. And by striking, we mean a number of the specific causes justifying action appear in the Walmart suit as they appeared in the Blue Moon suit verbatim. And both ultimately rest on the argument of ownership.

Just as the MillerCoors suit claimed the company was in violation of California’s “deceptive practices” law for “passing off Blue Moon as a product of Blue Moon Brewing Company, when it is in fact a product of MillerCoors,” Walmart is facing allegations of fraud for failing to disclose that “Trouble Brewing did not exist and actively concealed the true nature” of the product.

Now, you already know who’s behind Blue Moon. As for Walmart’s beer, the suit notes: “The applicant listed on filings with the Treasury Department’s Alcohol and Tobacco Tax and Trade Bureau (TTB) is ‘Winery Exchange Inc.’, which has since turned into WX Brands... But under the ‘brewery address’ section of the TTB filings, Genesee Brewing’s business office in Rochester, NY is listed instead. Genesee is [owned] by another company that brews Costa Rican lager among other industrial brands.”

If that, too, sounds familiar, it’s because the Washington Post reported as much in a well-circulated article less than a month ago. That’s not likely news to the plaintiff or the counsel, though, as the suit explicitly references a quote from the article, attributed to a senior buyer at Walmart that, per the suit, “all but admits” guilt. The quote: “We were intentional about designing a package that conveyed a look and feel you’d expect of craft beer.” On that note, the suit continues: “This is a material in many individuals’ purchasing decisions, as they believe they are purchasing a product made in small amounts that is of inherently superior quality."

Of course, "craft" and "quality" is more a venn diagram than one big circle, but that's for another day. For now, we're not entirely sure how the two cases are different exactly. But we'll keep watch to see how this thing plays out.

—Dave Eisenberg

READ MORE
Class Says Wal-Mart ‘Craft’ Beer is Mass Produced [Court House News]