This Report summarizes cases granted review on November 21 and December 1 and 9, 2022 (Part I).
Case Granted Review: Jack Daniel’s Properties, Inc. v. VIP Products LLC, 22-148
Jack Daniel’s Properties, Inc. v. VIP Products LLC, 22-148. This case involves VIP Products’ sale of a “poop-themed” dog toy that looks like a bottle of Jack Daniel’s. The two questions are: (1) “Whether humorous use of another’s trademark as one’s own on a commercial product is subject to the Lanham Act’s traditional likelihood-of-confusion analysis, or instead receives heightened First Amendment protection from trademark-infringement claims.” (2) “Whether humorous use of another’s mark as one’s own on a commercial product is ‘noncommercial’ under 15 U.S.C. §1125(c)(3)(C), thus barring as a matter of law a claim of dilution by tarnishment under the Trademark Dilution Revision Act.”
Under the Lanham Act, using another’s mark in a manner likely to cause confusion about the origin, sponsorship, or approval of a good is trademark infringement. 15 U.S.C. §§1114(1), 1125(a)(1). Courts assessing likelihood of confusion consider factors including the mark’s strength, relatedness of the goods, similarity of the parties’ marks, the defendant’s intent, and evidence of actual confusion. Additionally, under 15 U.S.C. §1125(c)(1), a “famous” mark’s owner may obtain relief against use of a mark likely to cause “dilution by blurring” or “dilution by tarnishment,” whether or not the use likely confuses consumers. Dilution by tarnishment happens when the “association” due to the “similarity between a mark or trade name and a famous mark . . . harms the reputation of the famous mark.” Id. §1125(c)(2)(C). Fair use of famous marks in noncommercial uses and parody are exempt. The fair-use exemption is limited, however, to uses “other than as a designation of source for” the defendant’s “own goods or services.” Id. §1125(c)(3)(A).
The district court granted summary judgment to Jack Daniel’s on several issues. It held that Jack Daniel’s’ trade dress and bottle design were entitled to trademark protection, and VIP was not entitled to either fair-use or First Amendment defenses. The case proceeded to a bench trial. The court found that Jack Daniel’s had established dilution by tarnishment and trademark infringement. The Ninth Circuit affirmed in part and reversed in part. 953 F.3d 1170. Relevant here, it held that VIP’s dog toy was expressive work entitled to First Amendment protection unless Jack Daniel’s could show on remand that VIP’s use (1) is “not artistically relevant to the underlying work” or (2) “explicitly misleads consumers as to the source or content of the work.” (Quotation omitted.) Next, it held that Jack Daniel’s could not show dilution by tarnishment because VIP’s use was humorous and expressive and therefore noncommercial and protected by the First Amendment. On remand, the district court held that Jack Daniel’s failed to show lack of artistic relevance or explicit misleading, so VIP’s use was entitled to First Amendment protection.
Jack Daniel’s argues first that the Ninth Circuit erroneously grafted the atextual two-part test for First Amendment protection onto the Lanham Act. In so doing, it argues, the court improperly granted humorous use of a trademark heightened protection, which Congress did not intend. Jack Daniel’s contends that the court should have instead simply considered the humorous nature of the use in the likelihood-of-confusion test, as several other circuits do. Next, Jack Daniel’s argues that the Ninth Circuit erred in holding that VIP’s use was noncommercial because it was humorous. It points out that Congress expressly excluded parodies of famous marks from dilution claims, but only when the parody is not used “as a designation of source” for the defendant’s goods. §1125(c)(3)(A). It argues that the parody exemption is a more apt fit here than the noncommercial exemption; and the parody exemption does not apply because VIP used Jack Daniel’s mark as a designation of source. The Ninth Circuit’s decision, it claims, “improperly renders superfluous” the parody exception’s limitation to instances where the defendant is not using the mark as a designation of source.