Owners of registered trademarks understand the significant, inherent value of Intellectual Property. To maintain that value, the importance of "policing" one's mark from infringing and inappropriate third-party use cannot be overstated. The United States Patent and Trademark Office ("USPTO") defines trademark infringement as "the unauthorized use of a trademark or service mark on or in connection with goods and/or services in a manner that is likely to cause confusion, deception, or mistake about the source of the goods and/or services." Infringement has the potential to not only dilute the value of a mark, but also to negatively impact a mark owner's underlying business. To resolve an important trademark matter that has worked its way up from the lower courts, the Supreme Court of the United States ("SCOTUS") recently agreed to hear a case concerning the alleged infringement of a famous and instantly recognizable Jack Daniel's trademark.
Why did SCOTUS Agree to Hear the Jack Daniel's Trademark Case?
When SCOTUS grants a writ of certiorari to hear and decide a case, it is typically because lower courts have conflicting interpretations of the rule of law at hand. Jack Daniel's Properties, Inc. ("Jack Daniel's") petitioned for certiorari because, as it points out in its papers, the various courts of appeal across the country are divided on how to rule on the issue of humorous fair use (parody) in trademark infringement cases. According to the facts at issue in VIP Products LLC v. Jack Daniel's Properties, Inc., VIP Products LLC ("VIP") designs chew toys that are made to humorously resemble well-known alcohol and soda brands. VIP created and sells a chew toy modeled after the Jack Daniel's iconic whiskey bottle. After receiving a cease-and-desist letter from Jack Daniel's, VIP sought a declaratory judgment from a district court in Arizona that its chew toy did not infringe upon, or dilute, Jack Daniel's trademark rights. The district court ruled in favor of Jack Daniel's. On appeal, the Ninth Circuit Court of Appeals overturned the lower court decision, holding that VIP's chew toy was an expressive work entitled to fair use protection under the First Amendment.
Questions Presented to SCOTUS in the Jack Daniel's Trademark Proceeding
Trademark law creates a natural tension between trademark owners' rights and the First Amendment. Courts of law are tasked with deciding when the use of a third party's trademark amounts to either protectable freedom of expression or trademark infringement. According to the SCOTUS docket, the Court will consider the following two questions in the Jack Daniel's trademark case:
I. 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.
Lessons at this Stage of the Jack Daniel's Trademark Case
Trademark owners have a duty to actively protect their marks. Businesses that fail to police their marks risk the weakening, or even eventual loss, of their trademark rights. Jack Daniel's undertook to actively protect its mark from third party dilution by tarnishment. According to a New York Times article, attorneys for Jack Daniel's indicated that the chew toy, among other things, "'harms Jack Daniel's brand, including by associating whiskey with excrement and toys that appeal to children.'" Jack Daniel's now finds itself pursuing VIP all the way to SCOTUS in order to protect its valuable intellectual property. The outcome of this case could have serious fair use implications for trademark owners under similar circumstances. We anxiously await a definitive ruling on this important issue of trademark law.
Related Blog Posts:
Jack Daniel's Petitions For Certiorari To Clarify Trademark Fair Use
Jack Daniels Chewed Up By Trademark Law
A Trademark Lawyer's Guide To Protecting Your Brand
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