Monster Beverage Corporation faces a new legal scrap with hip-hop combo The Beastie Boys, and says it cannot predict the business effects of another action filed by an unnamed state attorney general’s office in July.
In a filing via the US District Court, in the Southern District of New York last Wednesday, the surviving members of The Beastie Boys and the widow of their recently deceased bandmate Adam Yauch all claimed damages and injunctive relief against the firm for allegedly infringing song trademarks.
The compliant relates to alleged trademark infringement under the Lanham Act – the main US federal statue covering trademark infringements – with the musicians represented by NYC entertainment lawyer Theodore Conrad from Sheppard, Mullin, Richter & Hampton.
Battle of the beasts
Diamond, Horowitz and Yauch contend that Monster used Beastie Boys song such as ‘Sabotage’ and ‘Make Some Noise’ to create a promotional video for its ‘Ruckus in the Rockies 2012’ snowboarding event, made available on You Tube on or about May 9.
“The soundtrack of the video is comprised substantially of excerpts from the Beastie Boys sound recording and musical compositions totaling more than three minutes in duration,” the filing said.
Concurrently with the video, the plaintiffs said that Monster also supplied a link to a downloadable MP3 file comprising a “23-minute medley of excerpts from the Beastie Boys Sound Recordings”
Accompanying text on some websites gave consumers the impression that the Beastie Boys permitted the use of their name and intellectual property, the plaintiffs said, quoting one statement accompanying a video posting.
“With tracks from the Beastie Boys putting you in the vibe and sponsorship from Monster Energy, this edit will make you want to ride and party like no other…” it said.
Adam Yauch’s will reveals the rapper – who died of cancer aged 47 on May 4 – amassed a $6.4m fortune, with his widow granted the right to sell and manage his artistic property, but forbid the use of his image, music and art for advertising purposes.
State attorney general uncertainty
In its quarterly report filed with the US Securities and Exchange Commission (SEC) last Thursday, Monster also revealed it had received a subpoena from an unnamed state attorney general’s office that is investigating its advertising, marketing, promotion, drink ingredients, usage and sale.
“As the investigation is in an early stage, it is unknown what, if any action the state attorney general may take against the company, the relief which may be sought in the event of such processing or whether such proceeding could have a material adverse effect on the company’s business, financial condition or results of operations.”
Discussing risk factors that emerged since its previous SEC filing in December, Monster admitted that such actions could lead to fines, product reformulation and container changes.
Changes in the use or sale of energy drinks, and/or changes in advertising, marketing and promotion practices could also result, the firm added.
Also in the SEC filing, Monster discussed NYC mayor Michael Bloomberg's proposed NYC ban on sales of sugar-sweetened beverages and sodas over 16oz, and said it packed Monster Energy and Peace Tea in larger cans.
The mayor of Cambridge, Massachusetts had also proposed a similar initiative, Monster said, before adding: “Should future proposals to limit or restrict the size of packaging…be enacted by the federal government, states, counties and/or other jurisdictions or agencies, such legislation could result in a reduction in sales and adversely affect our results of operations.”