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(Legal) moonshiner and university battle over rights to ‘Kentucky’

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(Legal) moonshiner and university battle over rights to ‘Kentucky’

University athletic departments around the nation have grown increasingly aggressive about defending
(Legal) moonshiner and university battle over rights to ‘Kentucky’
Colin Fultz at his moonshine and whiskey distillery in Whitesburg, Ky., March 14, 2016. Fultz has launched a lawsuit against the University of Kentucky after it wanted to block him from trademarking 'Kentucky Mist Moonshine' for T-shirts, hats and othe...

WHITESBURG, Ky. — Moonshine packs a punch in this corner of Appalachia, where making hooch is steeped in local lore. But when Colin Fultz, the grandson of a bootlegger, opened a gourmet distillery here last fall, he ran afoul of a spirit even more potent than white lightning: University of Kentucky basketball.

With his outlaw grandfather — who spent 18 years behind bars for smuggling — very much on his mind, Fultz, a businessman and onetime coal miner, set out to carry on his family’s tradition in a legal, and thoroughly modern, way.

He tinkered with recipes, blending peaches and blackberries into mash brewed in his garage. He hired a lawyer — “My wife got on me, said I was going to get into trouble,” he said — and renovated an old car dealership, where he now distills and sells fruit-infused whiskey, serving it in thimble-size cups from an exposed-brick tasting bar.

But Fultz also tried to trademark his business name: Kentucky Mist Moonshine. And that, sports fans, is how a moonshine maker wound up suing the University of Kentucky — the basketball behemoth exalted by its “Big Blue Nation” of fans — in federal court over a fundamental question: Who owns the rights to the name of the state?

The university says it does; it wants to block Fultz from trademarking “Kentucky Mist Moonshine” for T-shirts, hats and other apparel (though not his moonshine) sold in his distillery gift shop. It registered the word “Kentucky” with the U.S. Patent and Trademark Office for clothing in 1997, 19 years ago.

“'Kentucky’ is our issue — not the mist or the moonshine,” said Jason Schlafer, the university’s executive associate athletic director, who oversees marketing and licensing for the Wildcats, Kentucky’s sports teams.

But here in Whitesburg — a little city of about 2,100 people on the North Fork of the Kentucky River, where an annual fall festival showcases mountain heritage, music and crafts — the university’s stance has gone down about as smoothly as a shot of bathtub gin, even with die-hard Wildcats fans.

“UK basketball is our cultural icon, it’s what brings Kentuckians together,” said Dee Davis, president and founder of the Center for Rural Strategies, a nonprofit that seeks to improve social and economic conditions in the region. “So it’s absolutely silly that the university would waste its time trying to go after some poor mountain entrepreneur.”

University athletic departments around the nation have grown increasingly aggressive about defending what they see as their intellectual property; in 2006, the University of Alabama sued an artist who painted football scenes, asking a federal judge to bar him from using the school’s “famous crimson and white color scheme.”

And while a number of public universities, in places like Georgia, Michigan and Ohio, also own rights to their state names, several experts in patent and trademark law predict Fultz — who is already selling T-shirts in the gift shop — will get his trademark in the end.

Trademarked state names offer “a very narrow scope of protection,” R. Polk Wagner, a law professor and intellectual property expert at the University of Pennsylvania, said.

Rebecca Tushnet, a professor at Georgetown University Law Center who has advised Fultz’s lawyer, said it is hardly unusual for a university to try to enforce its trademarks.

“But this struck me as pretty serious overreaching,” she said.

Fultz, a Republican, was so incensed he is now running for state representative.

“No one person should own the name ‘Kentucky,'” he said.

Whitesburg is in the heart of Eastern Kentucky coal country, a region suffering from job losses and economic hard times. Making legal moonshine, in a state known for its bourbon, is a hot new trend. So when Fultz, 45, proposed the idea of an upscale distillery, Mayor James Wiley Craft saw it as a way to increase tourism downtown.

They worked together on a plan for Fultz to renovate the old car dealership, which was owned by the city. Craft, 70, a lawyer (and a graduate of the University of Kentucky law school) says the idea took a bit of selling to the City Council; Whitesburg was dry until 2007, and “the connotation of making alcohol in the city” did not go over well.

The six-member council split 3-3; Craft cast the tiebreaking vote in November 2014.

“It was an awful fight,” Fultz said, in his soft mountain twang. “They was like: ‘Alcohol is bad enough. We don’t need a distillery.'”

Despite his colorful family history — his other grandfather, not the bootlegger, was killed by a brother-in-law “in a fight over a piece of land” — Fultz is a mild-mannered man. But when lawyers for the state’s flagship university, 145 miles away in Lexington, sent him a letter last October, one month after he opened, vowing to “consider further action as it deems necessary” if he did not abandon his application for a clothing trademark, he and his lawyer took it as fighting words.

“The last thing you do is fire off a threatening letter in Eastern Kentucky,” said his lawyer, Jim Francis, who said one of his own ancestors was killed in the region’s infamous Hatfield and McCoy feud. “That only results in one thing: You’ve got a fight on your hands.”

Schlafer, the university athletic official, says the letter was a pro forma entry to negotiations, and insists that the university — whose athletic department generates $123 million a year in revenue, mostly from basketball, football and media rights — has the right to protect “the strength of that brand.” He said mostly, the university wants to keep Fultz from marketing Kentucky Mist Moonshine shirts in the school’s signature colors, blue and white.

“We had always hoped we could have a conversation,” he said.

Instead, Francis — who complains that the university does not pick on big companies, like Kentucky Fried Chicken — filed suit in federal court in Lexington, seeking to force the university to drop its opposition to the trademark. The university has asked a judge to dismiss the case, on the grounds that as an arm of the state it has sovereign immunity and cannot be sued. Both sides are hoping for a decision soon.

Francis says that no matter what happens with the trademark application, he expects the sovereign immunity question to go all the way to the Supreme Court.

Here in Whitesburg, Fultz, who could be found one recent afternoon mixing blackberries (his favorite berry for flavoring moonshine) in a stainless steel mash tank, is trying to expand his fledgling business. He traveled to New York not long ago to attend a trade show with fellow distillers and winemakers, where he met with distributors.

“We got great feedback from Canada,” he said.

He has been campaigning hard for state representative; he has competition in the Republican primary, which is May 17. He insists that he is still an enthusiastic member of the Big Blue Nation: “I mean, everybody around here is a big Wildcats fan.”

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