By David Sar
“This case is about dog toys and whiskey, two items seldom appearing in the same sentence.”
So began the U.S. Supreme Court’s only trademark decision of the 2022-23 term, Jack Daniel’s Properties Inc. v. VIP Products LLC (June 8, 2023).
Parody, trademarks and the First Amendment also were at issue. In a unanimous decision written by Justice Elena Kagan, the court rejected the use of a First Amendment filter to defeat a trademark claim before getting to the question of the likelihood of confusion, provided that the mark is also source-identifying. The court thus declined an opportunity to make an expansive pro-First Amendment ruling. It instead charted a measured course for applying First Amendment concerns to source-identifying parody trademarks.
VIP made a squeaky, chewable dog toy designed to look like a bottle of Jack Daniel’s whiskey. Rather than the name Jack Daniel’s, it used “Bad Spaniels.” Other writing on the bottle was changed to what the 9th U.S. Circuit Court of Appeals called “humorous message[s],” and it displayed a disclaimer of affiliation with Jack Daniel’s.
Jack Daniel’s sued for federal trademark infringement, asserting ownership of various trademark rights in the name and bottle and a likelihood of confusion, as well as trademark dilution by tarnishment. VIP defended on parody grounds.
After a bench trial, it was found, largely based on survey evidence, that consumers were likely to be confused about the source of the toy. In the first appeal, the 9th Circuit reversed and remanded, adopting and expanding the Rogers v. Grimaldi (875 F.2d 994 (2d Cir. 1989)) First Amendment filter test from the 2nd Circuit.
That test originated from Ginger Rogers’ lawsuit against the producers of a Federico Fellini film titled “Ginger and Fred” concerning dancers imitating Rogers and Fred Astaire. Under the federal Lanham Act, Rogers objected to the use of her name. The 2nd Circuit articulated a test that the First Amendment mandated rejection of claims like hers if the title of the artistic work had an expressive element “with at least some artistic relevance” and was not “explicitly misleading as to source or content.”
The 9th Circuit remanded for determination of whether the Rogers test was satisfied and found that VIP defeated the dilution claim without addressing the anti-dilution statute’s exclusion for parody and other fair uses. The 9th Circuit decided that VIP’s parody was noncommercial, even if used to sell a product. After the first remand, VIP won, the 9th Circuit affirmed and certiorari was granted.
The Supreme Court rejected the 9th Circuit’s use of the Rogers test and “any threshold First Amendment filter” (per footnote 1 of the decision). The court wrote that the Rogers test has always been a “cabined doctrine” applicable when the defendant is not using its mark as a source-identifier. The test should not be used to insulate a defendant’s source identification from ordinary trademark scrutiny.
Quoting Mattel Inc. v. MCA Records Inc. (296 F.3d 894, 900 (9th Cir. 2002)), the Supreme Court reasoned that “when a challenged trademark use functions as ‘source-identifying,’ trademark rights ‘play well with the First Amendment’: ‘Whatever First Amendment rights you may have in calling the brew you make in your bathtub “Pepsi”’ are ‘outweighed by the buyer’s interest in not being fooled into buying it.’”
Since the lower court had already determined that VIP’s alleged parody was source-identifying, the Supreme Court reversed and sent the case back down for consideration of whether there was infringement under standard trademark analysis. But this time in that process, the lower court must consider the attempt to ridicule Jack Daniel’s and arguable parody.
The Supreme Court expressly declined to rule whether the Rogers test should be applied in other, non-source source-identifying contexts. Three of the justices — Justices Neil Gorsuch, Clarence Thomas and Amy Coney Barrett — wrote a concurrence, noting that it was not clear that the First Amendment commanded the Rogers test or whether it was even correct.
With respect to dilution, the Supreme Court also dispatched the 9th Circuit’s analysis. The court wrote that the noncommercial use exclusion “cannot include, as the Ninth Circuit thought, every parody or humorous commentary.” That would reverse the direction of the statute and nullify Congress’ limit on the fair-use exclusion for parody, the court reasoned.
How this decision will play out in other cases will likely be explored over the next few decades. But the Supreme Court has made clear for now that in the context of source-identifying parodies, there is no First Amendment filter prior to considering traditional trademark analysis.
David Sar of Brooks, Pierce, McLendon, Humphrey & Leonard’s Greensboro office is an intellectual property lawyer and is a board-certified specialist in trademark law.