Beer and sports generally go hand-in-hand, but now the combination has Penn State and a Florida man’s business entangled in a federal lawsuit.
The university accused Sport Beer Brewing Company of exploiting its “Penn State” and “Nittany Lions” trademarks to “blatantly trade off of Penn State’s goodwill and reputation,” according to the 117-page lawsuit filed Friday in the U.S. District Court for the Middle District of Pennsylvania.
Owner Paul Parshall, who operates the business out of Naples, Fla., on Monday said he has not yet reviewed the lawsuit and declined to comment.
“As a trademark owner, the university has an obligation to protect its trademarks from infringement and dilution and to take all steps necessary to prevent confusion from arising in the marketplace among our students, alumni, fans and the general public,” university spokeswoman Lisa Powers said in a statement. “In this instance, the university’s marks were being used in a prominent and extensive manner, and indicating an affiliation with Penn State that does not exist.”
Parshall’s business model, according to the university, is to “secretly” register famous marks with state departments and then license them as his own.
Parshall filed an application to the Pennsylvania Department of State in August 2016 for “Penn State Nittany Beer” and “Penn State Nittany Brewing Co.,” according to the lawsuit.
Filings at the state level do not require a formal search process with rejections for infringement or likelihood of confusion with existing state or federal trademarks and there is no public publication and response period, according to the lawsuit.
Penn State was notified of the filings when the Pennsylvania governor’s office of general counsel sent a letter in February 2018 to the university that said Parshall’s filings “closely resembles trade names and trademarks currently in use and registered by your organization,” according to the letter included in the lawsuit.
The university sent Parshall a cease and desist letter in both June 2018 and June 2019, but Parshall refused to stop using the monikers and said Penn State never used “beer” in any of their filings. He also expressed a willingness to work with the university to resolve the dispute.
“When Penn State contacted (Parshall) about his infringement of the famous Penn State marks, (Parshall) wanted a buyout — to sell Penn State’s own marks back to Penn State,” university attorney Megan Haines wrote in the lawsuit.
The university sued Parshall for two counts of trademark infringement, two counts of unfair competition, four counts of trademark dilution, two counts of trademark counterfeiting and two counts of common law trademark infringement.
Haines requested a jury trial, a permanent injunction and Parshall to pay up to $2 million per each alleged trademark violation.
Washington, D.C.-based trademark attorney Josh Gerben, who is not affiliated with the lawsuit, said Monday that state registrations have historically been for small businesses and afford protections locally, but not outside a particular state.
“This looks like a pretty strong case for Penn State,” Gerben said. “When someone owns a federal trademark registration, they are entitled to protection against the trademark that is registered and any similar trademark that could cause consumer confusion.”