My other trademark dilution defense is the First Amendment

By Marie-Andrée Weiss

MOB, founded by Tara Martin, sells canvas bags featuring “My other bag …” on one side and a drawing of an upscale handbag, such as the Hermès Kelly bag, the quilted Chanel bag, or a Louis Vuitton bag, on the other side. The MOB bags retail for $35 to $55, depending on their size. In creating this product, Ms. Martin was inspired by the “My other car is a … [name of luxury car]” novelty bumper stickers.

French luxury accessory company Louis Vuitton (LV) did not appreciate this use of its trademark and copyright-protected designs and filed a trademark infringement, trademark dilution by blurring, and copyright infringement suit against MOB, which moved for summary judgment, claiming the bags are a parody. On 8 January 8 2016, Judge Furman of the Southern District of New York (SDNY) found the MOB bags to be parody and granted MOB’s motion for summary judgment. LV then appealed the decision to the Second Circuit.

This case is interesting, as the Judge Furman found that parody was a successful defense against trademark dilution, trademark infringement, and copyright infringement claims. An amicus curia brief even argues that applying trademark dilution law to MOB’s use of LV’s trademarks would violate the First Amendment.

 

Trademark dilution claim

The Federal Trademark Dilution Act of 1995 (FTDA), 15 U.S.C. § 1125(c), was passed to give owners of famous trademarks protection against uses of their marks which would lessen their ability to identify and distinguish their goods or services, even if there is no likelihood of confusion. In Tiffany (NJ) Inc. v. eBay Inc., the Second Circuit defined dilution by blurring as “the whittling away of the established trademark’s selling power and value through its unauthorized use by others.” Dilution occurs because consumers are developing new associations with the famous mark.

15 U.S.C. § 1125(c)(2)(B) enumerates six factors to be used to assess whether a particular use of a famous mark dilutes it: (1) the degree of similarity between the challenged mark and the famous mark; (2) the degree of distinctiveness of the famous mark; (3) the extent to which the owner of the famous mark is engaging in exclusive use of the mark; (4) the degree of recognition of the famous mark; (5) whether the user of the mark or trade name intended to create an association with the famous mark; and (6) any actual association between the mark or trade name.

 

What is a parody?

15 U.S.C. § 1125(c)(3)(C) provides a parody defense against a trademark dilution claim if the use of a famous mark is made to “identif[y] and parod[y], criticiz[e], or commen[t] upon the famous mark owner or the goods or services of the famous mark owner.” However, the FTDA does not define parody. Judge Furman quoted the Fourth Circuit Louis Vuitton Malletier S.A. v. Haute Diggity Dog, LLC case, where the Court explained that “parody must convey two simultaneous — and contradictory — messages: that it is the original, but also that it is not the original and is instead a parody. This second message must not only differentiate the alleged parody from the original but must also communicate some articulable element of satire, ridicule, joking, or amusement.”

In Haute Diggity Dog, the Fourth Circuit had found that the “Chewy Vuiton” chew toys for dogs, which were small and rather crude imitations of Louis Vuitton bags, did not dilute LV’s trademarks. The Court noted that “[t]he [LV] handbag is provided for the most elegant and well-to-do celebrity, to proudly display to the public and the press, whereas the imitation ‘Chewy Vuiton’ ‘handbag’ is designed to mock the celebrity and be used by a dog… The dog toy is a comment on the rich and famous, on the LOUIS VUITTON name and related marks, and on conspicuous consumption in general.” Judge Furman also quoted § 31:153 of the McCarthy treaty on Trademarks and Unfair Competition which explains that a particular use of a trademark is a parody if it communicates to the public that is “separate and distinct from the trademark owner” and “is poking fun at a trademark or the policies of its owner.” Judge Furman noted that “my other car” bumper stickers were “a joke — a riff, if you will, on wealth, luxury brands, and the social expectations of who would be driving luxury and non-luxury cars.” He concluded that MOB’s use of LV trademark was a parody.

 

Are MOB bags a parody?

On appeal, LV argues that a parody must be “directed at or ‘upon’ the trademark owner or its famous mark.” For LV, the MOB parody does not target LV but instead makes fun of MOB itself, “at best,” and is not even a parody, but, rather, a “social commentary” (LV reply brief p.8). LV cites the Harley Davidson, Inc. v. Grottanelli case, in which the Second Circuit held in 1999 that using a mark to “humorously… promote [one’s] own products and services… is not a permitted trademark parody use” (Harley Davidson at 813). The Second Circuit, however, noted in Harley Davidson that it has “accorded considerable leeway to parodists whose expressive works aim their parodic commentary at a trademark or a trademarked product . . . but ha[s] not hesitated to prevent a manufacturer from using an alleged parody of a competitor’s mark to sell a competing product” (Harley Davidson at 812). The Second Circuit found no parody in Harley Davidson because it found the use was not a comment.

MOB argues that “MOB’s parody is communicated to consumers with a combination of features of the bags themselves, including, for example, the large stylized text ‘My Other Bag . . .’ on one side, the cartoonish depictions of designer handbags on the other side, the plain canvas material, and the bag-on-bag concept itself.” MOB argued that, therefore, the parody is communicated by two simultaneous and contradictory message, within the meaning of Haute Diggity, “that it is the original, but also that it is not the original”(Appellee brief at 19) (emphasis in original).

The amicus curia brief filed by Professor Christopher Jon Sprigman and Professor Rebecca Tushnet argued that the “MOB bags are commenting humorously on society’s obsession with owning status symbols, and with showing them off” (Amicus Curia brief at 4). Indeed, LV bags are not the sole source of inspiration for MOB. Some of its canvas bags also feature bags from Hermès, Chanel, or Fendi. The Fourth Circuit had noted in Haute Diggity Dog that the Chewy Vuiton parody was “enhanced by the fact that the ‘Chewy Vuiton’ dog toys are sold with similar parodies of other famous and expensive brands” such as “Chewnel No. 5” or “Jimmy Chew.”

 

Trademark infringement

Judge Furman used the eight-factor Polaroid test used in the Second Circuit to assess whether an unauthorized use of the mark is infringing. He found that the trademark infringement claim “fail[ed] for much the same reasons that [the] dilution claims failed.” As noted by the Fourth Circuit in Haute Diggity Dog (at 261), this is not surprising because “[w]hile it is true that finding a mark to be strong and famous usually favors the plaintiff in a trademark infringement case, the opposite may be true when a legitimate claim of parody is involved . . . In cases of parody, a strong mark’s fame and popularity is precisely the mechanism by which likelihood of confusion is avoided.” Consumers are not likely to be confused by a parody.

Interestingly, several celebrities who probably indeed own one or more LV bags, or, at least, could certainty afford to own one, have been seen carrying a MOB bag, some even using it as a grocery bag as envisioned by Ms. Martin when she first imagined the MOB bag. The Instagram account of MOB shows the picture of a woman carrying what appears to be an authentic quilted Chanel bag on one hand, and the MOB featuring the same Chanel bag on the other hand. These consumers are clearly not confused. MOB notes in its brief that LV “has admitted repeatedly… it knows that consumers are not confused” (Appellee brief at 46).

LV argues that there is post-sale confusion, which is recognized by courts, including the Second Circuit (Lois Sportswear, USA, Inc. v. Levi Strauss & Co.). For LV, “potential consumers or passersby could come to believe that MOB . . . is associated with [LV] or it at least consented to the use of its trademark” (Appellant reply brief at 21). However, as noted by the SDNY in Gucci America, Inc. v. Guess?, Inc., “a post-sale confusion plaintiff must still establish a likelihood of confusion among an appreciable number of post-sale observers, taking into account all the vagaries involved with post-sale observation,” further noting that “the fact that post-sale observers are removed from purchasing decisions makes post-sale trademark cases inherently difficult to prove, speculative, and subject to increased scrutiny” (Gucci America at 239). It remains to be seen if LV will meet this high standard. Professor Sprigman and Professor Tushnet noted in their brief that “the risks of post-sale confusion are lower with parody,” adding that the MOB is obviously a parody, which appears to the consumer either pre-sale or post-sale (Amicus Curia brief at 18).

 

Copyright infringement

Judge Furman had also found that MOB’s use of the LV trademark was fair use. As LV does not find that MOB bags are a parody, it argues that there is no fair use. Professor Sprigman and Professor Tushnet posit in their amicus curia brief that “LV did not file this case to protect its incentive to create new expressive works [but] to protect its brand from mockery,” adding that “any effect on the value of [LV]’s trademarks… is not the kind of harm copyright aims to avoid” (Amicus Curiae brief at 23).

 

Is the TDRA unconstitutional?

Professor Sprigman and Professor Tushnet argued in their brief that the TDRA “creates a content-based right that applies to non-misleading commercial speech” (Amicus Curiae brief at 20).  They note that the Second Circuit held in United States v. Caronia, applying the 2011 Supreme Court Sorrell v. IMS Health Inc. case, that “content-based suppression of non-misleading speech, including commercial non-misleading speech… must be shown to be narrowly tailored to serve compelling state interests” (Amicus Curiae brief at 19).  They argue that Congress has not shown there was a compelling interest to enact the TDRA and that it did not used the least restrictive way available in order to prevent dilution of famous marks. Therefore, the TDRA violates the First Amendment.

We saw in another post that the Federal Circuit recently found the anti-disparaging provision of the Trademark Act violated the First Amendment. Now, the TDRA may be found unconstitutional. These leaves the lingering question: will the tension between the First Amendment and trademark law continue to increase or begin to diminish?

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