[Guest post] Whiskey and dog toys: SCOTUS decision on First Amendment protection for expressive works

The IPKat is pleased to host the following guest post by Katfriend Alessandro Cerri regarding the US Supreme Court’s decision in the Jack Daniel’s v VIP IP dispute. Here’s what Alessandro writes:

Whiskey and dog toys: SCOTUS decision on First Amendment protection for expressive works

by Alessandro Cerri

In a recent judgment, the Supreme Court of the United States (the Court) held that the lower court had erred in finding that a dog toy which parodied Jack Daniel’s whiskey bottle was protected by the First Amendment’s free speech protections.

Background

This case began when VIP Products, the maker of the “Bad Spaniels” squeaky chewable dog toy (shown below) brought a suit against Jack Daniel’s seeking a declaratory judgment that Bad Spaniels had neither infringed nor diluted the numerous trademarks which Jack Daniel’s holds in its iconic whiskey bottle, and that Jack Daniel’s was not entitled to trademark protection for its trade dress and bottle design.

Bad Spaniels (L), Jack Daniel's (R) ...

Whereas the District Court had initially found in favour of Jack Daniel’s, rejecting VIP's nominative fair use and First Amendment defences, the Ninth Circuit, on appeal, reversed the District Court’s decision in favour of VIP Products, ruling that (as previously reported by the IPKat):

• Bad Spaniels was an “expressive work” protected by the First Amendment; and
• that there was no dilution of Jack Daniel’s trademarks because VIP Products’ use merely parodied Jack Daniel’s, and was therefore “noncommercial use”.

The Court’s ruling

Expressive work

A key question for the Court to determine was whether or not Bad Spaniels is an “expressive work”. This was important because where a mark is determined to be an “expressive work”, US courts have historically applied the threshold test derived from the First Amendment in the Rogers v Grimaldi decision.

The Rogers test requires, in the case of “expressive works”, the dismissal of an infringement claim at the outset. unless the complainant can show one of two things:

• That the challenged use has “no artistic relevance to the underlying work”; or
• That it “explicitly misleads as to the source or the content of the work.”

Only if either of these limbs apply will the court proceed to an assessment of likelihood of confusion, as is the ordinary course for trademark infringement actions.

The Rogers test has primarily been applied by the courts in situations where a mark is used to perform some form of expressive function rather than designate a work’s source – a topical example being the lawsuit brought by Mattel in the early 2000s in relation to the song Barbie Girl.

In this action, the Ninth Circuit found that because the Bad Spaniels dog toy (despite not being, in the Ninth Circuit’s words, “the equivalent of the Mona Lisa”) was protected by the First Amendment because it communicated a humorous message.

The Court in this decision (which did not opine on the merits of the Rogers test itself, but merely whether it might apply) disagreed, on the basis that humorous content does not automatically grant Rogers protection. Rather, the Court relied on case-law showing that where the use of a mark is “at least in part” for the purposes of source identification, Rogers has no proper role, even if the defendant is also “making an expressive comment” by way of its use. In fact, trademarks are often also expressive, containing hints to the relevant product’s origin or characteristics.

... and Kat Daniel's

In this case, the Court pointed to the fact that VIP had itself represented that it both owned and used the “Bad Spaniels’ trademark and trade dress” to “identify and distinguish” VIP’s products and indicate their source. It had, in fact, chosen to register several of its other products’ names as trademarks.

The Rogers test was not therefore applicable – although the Bad Spaniels parodic message could be a relevant factor in the assessment of likelihood of confusion.

Dilution

In respect of the dilution argument, Jack Daniel’s argued that VIP Products had diluted its marks by tarnishment – namely by creating an association between Jack Daniel’s whiskey and, well, dog excrement (Bad Spaniels repurposed the phrase “Old No. 7 Brand Tennessee Sour Mash Whiskey” as “The Old No. 2 On Your Tennessee Carpet”).

The Court began by considering the scope of the Lanham Act’s exclusions for trademark infringement, and particularly that of fair use, which specifically includes uses “parodying, criticizing or commenting upon” a famous mark owner. The Lanham Act however also includes an exclusion to the exclusion – namely that the fair use exclusion will not apply when the relevant use is “as a designation of the source for the person’s own goods or services”.

The Court therefore held (given its prior findings regarding VIP Products’ use of the marks as source identifiers) that the parody exclusion did not apply, and that the Ninth Circuit had erred in its overly expansive view on the “noncommercial use” exclusion, which effectively nullified Congress’ express limit on the fair-use exclusion.

Comment

In many ways the most impactful element of this decision was its lack of impact on the existing Rogers test. Instead, the status quo was largely preserved by the somewhat unsurprising conclusion that marks being used as trademarks (i.e. source identifiers) will ordinarily be treated as such.

The case is however an interesting reminder that the US differs from the EU in the fact that it has codified, through the Lanham Act, an express parody exclusion for trademark infringement, whereas in the EU the courts have had to navigate the slightly more nebulous concept of "due cause" (Article 9(2)(c) EUTMR; Article 10(6) and (2)(c) EUTMD) in order to seek to accommodate freedom of expression in accordance with Recital 21 EUTMR and 27 EUTMD.

It will be interesting to see how the CJEU tackles the upcoming IKEA referral in this regard.