Free Speech and Trademark Rights…Continued.

Earlier this month, the 9th Circuit ruled in favor of VIP Products, LLC (“VIP”), in the prolonged trademark battle between VIP and Jack Daniel’s Properties, Inc. (“Jack Daniel’s”) based on VIP dog toys that mimic the design of Jack Daniel’s whiskey bottles. The dog toys in question are shaped like Jack Daniel’s famous whiskey bottles, and include dog-themed jokes. For example, the VIP dog toys replace “Old No. 7” with “the Old No. 2, on your Tennessee Carpet.” We previously wrote about this case, during its stint at the Supreme Court. 

The Supreme Court ruled in favor of Jack Daniel’s, by holding that under the test to evaluate whether a trademark qualifies for a fair use exception as a parody does not extend to VIP’s dog toy. The Court did expressly state that this was a narrow holding:

We do not decide whether the Rogers test is ever appropriate, or how far the “noncommercial use” exclusion goes. On infringement, we hold only that Rogers does not apply when the challenged use of a mark is as a mark. On dilution, we hold only that the noncommercial exclusion does not shield parody or other commentary when its use of a mark is similarly source-identifying. It is no coincidence that both our holdings turn on whether the use of a mark is serving a source-designation function. The Lanham Act makes that fact crucial, in its effort to ensure that consumers can tell where goods come from.

In making this holding, the case was remanded back to the lower courts to proceed in accordance with this ruling. At the district court level, Jack Daniel’s once again prevailed, earning a permanent injunction, not based on infringement, but trademark dilution by tarnishment. That decision and injunction is what the 9th Circuit decided in reversing the lower court and vacating the injunction for VIP. The 9th Circuit’s holding turned on its application of the Trademark Dilution Revision Act (“TDRA”), which requires establishing the famousness of the mark, and then finding that said famous mark(s) is tarnished by the accused’s use. As applied to VIP, Jack Daniel’s only proved the famousness of its trade dress for its bottle and the mark “Jack Daniel’s.” In evaluating whether the VIP toy diluted these particular Jack Daniel’s trademarks, the 9th Circuit held that Jack Daniel’s did not establish any harmful association between the “lavatorial references” of the VIP toy to the particular famous marks. In making this holding, the 9th Circuit sided with its sister circuits with respect to interpreting parody in the context of dilution where:

‘…parody is not automatically a complete defense to a claim of dilution’ because ‘the defendant uses the parody as its own designation of source,’ the TDRA ‘does not require a court to ignore the existence of a parody that is used as a trademark, and it does not preclude a court from considering parody as part of the circumstances to be considered for determining whether the plaintiff has made out a claim for dilution.’

With the vacatur of the injunction, VIP may again begin selling its toys. 

We will continue to follow the case for any future developments.