![\"Dilution](\"https:\/\/www.coveringyourads.com\/wp-content\/uploads\/sites\/38\/2023\/06\/IP-Blog-Image-LawGavel-660x283-1-656x281.png\")
<\/p>\n
\n<\/p>\n
<\/p>\n
On June 8, 2023, the Supreme Court in a unanimous decision held that a trademark claim concerning \u201ca squeaky, chewable dog toy designed to look like a bottle of Jack Daniels whiskey\u201d which, as a play on words, turns the words \u201cJack Daniels\u201d into \u201cBad Spaniels\u201d and the descriptive phrase \u201cOld No. 7 Brand Tennessee Sour Mash Whiskey\u201d into \u201cThe Old No. 2 On Your Tennessee Carpet\u201d does not receive special First Amendment treatment where the accused infringer used the trademarks at issue to designate the source of its own goods and that, with respect to a Lanham Act dilution by tarnishment claim, \u201c[t]he use of a mark does not count as noncommercial just because it parodies, or otherwise comments on, another\u2019s products.\u201d[1]<\/a><\/p>\n <\/span><\/p>\n The Case In the District Court , Ninth Circuit and Oral Argument in the Supreme Court<\/u><\/strong><\/p>\n Jack Daniels Properties, Inc. (\u201cJack Daniels\u201d), which owns registered trademarks for \u201cJACK DANIELS\u201d, \u201cOLD NO. 7\u201d, the arched logo, the stylized label and distinctive bottle, sent a cease and desist letter demanding that VIP Products LLC (\u201cVIP\u201d) stop selling its \u201cBad Spaniels\u201d chewable dog toy featuring the descriptive phrase \u201cThe Old No. 2 On Your Tennessee Carpet\u201d referencing dog urine because it infringed and tarnished its famous trademarks.\u00a0VIP brought a declaratory judgment action seeking a determination that its dog toy neither infringed nor diluted the Jack Daniels Trademarks.\u00a0Jack Daniels asserted counterclaims for trademark infringement and dilution.\u00a0VIP moved for summary judgment claiming that its dog toy was an \u201cexpressive work\u201d which was protected under the First Amendment by virtue of the test set forth in Rogers v, Grimaldi<\/em>,[2]<\/a> which requires dismissal of an infringement claim unless the trademark owner can show that the challenged use \u201chas no artistic relevance to the underlying work\u201d or that it \u201cexplicitly misleads as to the source or the content of the work\u201d[3]<\/a> and that Jack Daniel\u2019s dilution claim should be dismissed because the Bad Spaniels toy was a parody of Jack Daniels and therefore constituted \u201cfair use\u201d of Jack Daniels famous marks.\u00a0Jack Daniels argued the look-alike dog toy could confuse consumers and that its reference to \u201cthe Old No. 2 on your Tennessee carpet\u201d tarnishes the Jack Daniels trademark. The District Court rejected VIP\u2019s contentions and enjoined VIP from manufacturing and selling its Bad Spaniels dog toy holding that when \u201canother\u2019s trademark is used for source identification,\u201d the Rogers<\/em> test does not apply and the test is whether the use is likely to cause confusion.\u00a0The District Court also held that the fair use exclusion for parodies under the Lanham Act\u2019s dilution provision did not apply where the use at issue does not serve as \u201ca designation of source for the [alleged diluter\u2019s] own goods.\u201d VIP appealed to the Ninth Circuit\u00a0Court of Appeals and the Ninth Circuit held that VIP\u2019s dog toy was a communication of a humorous message and required heightened scrutiny to ensure that trademark protection for Jack Daniels did not intrude upon VIP\u2019s First Amendment rights.\u00a0With regard to dilution, the Ninth Circuit held that VIP was protected by the fair use exception for noncommercial uses.\u00a0The Court of Appeals returned the case to the District Court to decide whether Jack Daniels could show pursuant to Rogers v, Grimaldi<\/em> that the challenged use \u201chas no artistic relevance to the underlying work\u201d or that it \u201cexplicitly misleads as to the source or the content of the work.\u201d On remand, the District Court found that Jack Daniels could not satisfy either test and granted summary judgment to VIP. Jack Daniels\u2019 certiorari petition was granted and argument was held on March 22, 2023.\u00a0<\/p>\n The Supreme Court had an energetic oral argument with divergent views and questions advanced by the Justices.\u00a0Justice Elena Kagan, who authored the majority opinion, suggested the Bad Spaniels <\/em>dog toy was obviously a commercial product and said \u201c[t]hat\u2019s not a First Amendment problem.\u201d[4]<\/a>\u00a0Justice Thomas asked a number of hypotheticals and questioned whether Rogers v. Grimaldi<\/em> is inconsistent with traditional Lanham Act trademark protection.[5]<\/a>\u00a0When counsel for VIP argued that the dog toy was a parody that poked fun at a brand which \u201ctook itself too seriously,\u201d Justice Kagan responded: \u201cYou make fun of a lot of marks: Doggie Walker, Dos Perros, Smella Arpaw, Canine Cola, Mountain Drool.\u00a0Are all of these companies taking themselves too seriously?\u201d[6]<\/a> Counsel for VIP answered in the affirmative.\u00a0Justice Alito, on the other hand, questioned whether any reasonable consumer would assume the Bad Spaniels toy, even with its references to dog excrement, would have anything to do with Jack Daniels.[7]<\/a> Justice Brown Jackson questioned whether the Rogers v. Grimaldi<\/em> test was too permissive of \u201cexpressive works\u201d that cause confusion.[8]<\/a>\u00a0Counsel for Jack Daniels advocated elimination of the Rogers v. Grimaldi<\/em> test. Justice Sotomayor expressed reluctance stating \u201cI have some hesitation doing away with the Rogers test\u201d <\/em>which protects First Amendment rights.[9]<\/a><\/p>\n The Supreme Court\u2019s June 8, 2023 Unanimous Decision<\/u><\/strong><\/p>\n In its opinion, the Supreme Court stated that the Court initially needed to decide whether \u201cthe company [should] have had to satisfy the Rogers<\/em> threshold test before the case could proceed to the Lanham Act\u2019s likelihood-of-confusion inquiry\u201d and noted that the parties either attack or defend the Second Circuit precedent.[10]<\/a>\u00a0The Supreme Court declined to answer the question and noted \u201c[w]ithout deciding whether Rogers <\/em>has merit in other contexts, we hold that it does not when an alleged infringer uses a trademark in the way the Lanham Act more cares about: as a designation of source for the infringer\u2019s own goods.\u201d The Supreme Court recounted the facts and reasoning underlying Rogers <\/em>that \u201cthe titles of \u2018artistic works,\u2019 like the works themselves, have an \u2018expressive element\u2019 implicating \u2018First Amendment values.\u2019[11]<\/a>\u00a0The Supreme Court also noted that \u201c[o]ver the decades, the lower courts adopting Rogers<\/em> have confined it to similar cases, in which a trademark is used not to designate a work\u2019s source, but solely to perform some other expressive function\u201d and that \u201c[t]he same courts, though, routinely conduct likelihood-of-confusion analysis, without mentioning Rogers<\/em> when trademarks are used as trademarks \u2013 i.e.<\/em>, to designate source.\u201d[12]<\/a>\u00a0The Supreme Court noted that Rogers<\/em> was \u201ca cabined doctrine\u201d which \u201chas applied only to cases involving \u2018non-trademark uses\u2019 \u2013 or otherwise said, cases in which \u2018the defendant has used the mark\u2019 at issue in a \u2018non-source-identifying way.\u201d[13]<\/a><\/p>\n The Supreme Court held that \u201cthe District Court correctly held that \u2018VIP uses its Bad Spaniels trademark and trade dress as source identifiers of its dog toy\u201d and that \u201cVIP conceded that point below\u201d by alleging in its complaint that VIP \u201cown[s]\u2019 and \u2018use[s]\u2019 the \u2018Bad Spaniels\u2019 trademark and trade dress for its durable rubber squeaky novelty dog toy.\u2019\u201d[14]<\/a> While declining to apply the Rogers<\/em> test, the Court noted that \u201ca trademark\u2019s expressive message — particularly a parodic one, as VIP asserts \u2013 may properly figure in assessing the likelihood of confusion.\u201d[15]<\/a>\u00a0The Court remanded the case to the District Court to answer the question as to \u201cwhether the [use of] the Bad Spaniels marks are likely to cause confusion.\u201d[16]<\/a><\/p>\n Regarding the dilution by tarnishment claim asserted by Jack Daniels, the Supreme Court held that the Ninth Circuit erred by concluding that VIP\u2019s use is noncommercial because it parodies and \u201cconvey[s] a humorous message\u201d about Jack Daniels.[17]<\/a>\u00a0The Supreme Court noted that Section 1125(c)(3)(A)(ii)\u2019s \u201cfair use exclusion has its own exclusion: It does not apply when the use is \u2018as a designation of source for the person\u2019s own goods or services.\u2019 \u00a71125(c)(3)(A)<\/a>. In that event, no parody, criticism, or commentary will rescue the alleged dilutor.\u00a0It will be subject to liability regardless.\u201d[18]<\/a>\u00a0The Court noted that \u201c[t]he District Court had rightly concluded that because VIP used the challenged marks as source identifiers, it could not benefit from the fair-use exclusion for parody\u201d and while the Circuit Court\u2019s erroneous construction \u201cnegated Congress\u2019s judgment about when \u2013 and when not \u2013 parody (and criticism and commentary) is excluded from dilution liability.\u201d[19]<\/a>\u00a0The Supreme Court emphasized that its opinion was narrow and that \u201c[o]n infringement, we hold only that Rogers <\/em>does not apply when the challenged use of a mark is as a mark\u201d and [o]n 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.\u201d[20]<\/a><\/p>\n The Concurring Opinions<\/u><\/strong><\/p>\n Justice Sotomayor concurred and was joined by Justice Alito.\u00a0The concurrence was written separately \u201cto emphasize that in the context of parodies and potentially other uses implicating First Amendment concerns, courts should treat the results of surveys with particular caution\u201d because \u201c[s]urvey answers may reflect a mistaken belief among some survey respondents that all parodies require permission from the owner of the parodied mark.\u201d[21]<\/a> As a result, Judge Sotomayor noted:\u00a0\u201cCourts should thus ensure surveys do not completely displace other likelihood-of-confusion factors, which may more accurately track the experiences of actual consumers in the marketplace.\u00a0Courts should also be attentive to ways in which surveys may artificially prompt such confusion about the law or fail to sufficiently control for it.\u201d\u00a0This concurrence suggests that parties should not rely only upon survey evidence alone but should consider and weigh each of the likelihood of confusion factors.<\/p>\n Justice Gorsuch authored a separate concurrence and was joined by Justices Thomas and Barrett.\u00a0The concurrence was written \u201conly to underscore that lower courts should handle Rogers v, Grimaldi<\/em>, 875 F.2d 994 (CA2 1989), with care.\u201d\u00a0The concurrence noted \u201cit is not entirely clear where the Rogers<\/em> test comes from\u201d and \u201cit is not obvious that Rogers <\/em>is correct in all of its particulars\u00a0— certainly, the Solicitor General raises serious questions about the decision.\u201d\u00a0The decision cautioned:\u00a0\u201cAll this remains for resolution another day, ante<\/em>, at 13, and lower courts should be attuned to that fact.\u201d[22]<\/a>\u00a0As a result, three Justices have indicated serious reservations about the future of Rogers v, Grimaldi.<\/em><\/p>\n Summary:<\/u><\/strong><\/p>\n The Supreme Court\u2019s decision clearly prohibits the application of Rogers<\/em> in cases where the accused infringer used the trademarks at issue to designate the source of its own goods.\u00a0Regarding dilution claims under the Lanham Act, the decision makes plain that the exception under \u00a71125(c)(3)(A) does not apply to parodies where the use is \u201cas a designation of source for the person\u2019s own goods or services\u201d and \u201c[t]he use of a mark does not count as noncommercial just because it parodies, or otherwise comments on, another\u2019s products.\u201d[23]<\/a> The two concurrences suggest that the Supreme Court is skeptical about the use of confusion surveys in cases involving trademark parody cases and whether the Rogers<\/em> test \u201cis correct in all of its particulars.\u201d[24]<\/a>\u00a0As a result, while the decision is narrow, the concurrences foreshadow other possible issues that may be addressed by the Supreme Court in future Lanham Act cases.<\/p>\n FOOTNOTES<\/p>\n [1]<\/a> Jack Daniel\u2019s Properties, Inc. v. VIP Products LLC<\/em>, 599 U.S. ___ (2023) (slip op., at 2).<\/p>\n [2]<\/a> Rogers v. Grimaldi, <\/em>875 F. 2d 994, 999 (2d Cir, 1989).<\/p>\n [3]<\/a> Id.<\/em><\/p>\n [4]<\/a> Transcript of Oral Argument at 82-83, Jack Daniel\u2019s Properties, Inc., v. VIP Products LLC<\/em>, 559 U.S. __ (2023) (No. 22-148).<\/p>\n [5]<\/a> Id.<\/em> at 5-7, 90-91.<\/p>\n [6]<\/a> Id.<\/em> at 66.<\/p>\n [7]<\/a> Id.<\/em> at 28-33.<\/p>\n [8]<\/a> Id.<\/em> at 64-65, 86-87.<\/p>\n [9]<\/a> Id.<\/em> at 16.<\/p>\n [10]<\/a> 599 U.S. ___ (2023) (slip op., at 10).<\/p>\n [11]<\/a> Id.<\/em> at 11(citing Rogers v. Grimaldi, 875 F. 2d at 998).<\/p>\n [12]<\/a> 599 U.S. ___ (2023) (slip op., at 11-12).<\/p>\n [13]<\/a> 599 U.S. ___ (2023) (slip op., at 13) (quoting S. Dogan & M. Lemley, \u201cGrounding Trademark Law Through Trademark Use,\u201d 92 Iowa L. Rev.<\/em> 1669, 1683-1684 n.58 (2007)).<\/p>\n [14]<\/a> 599 U.S. ___ (2023) (slip op., at 17) (See App. to Pet. for Cert. 105a. at 3, 11.)<\/p>\n [15]<\/a> 599 U.S. ___ (2023) (slip op., at 18).<\/p>\n [16]<\/a> Id.<\/em><\/a><\/p>\n [17]<\/a> VIP Prods. LLC v. Jack Daniel\u2019s Props., Inc.<\/em>, 953 F. 3d, 1170, 1175-1176 (2020).<\/p>\n [18]<\/a> 599 U.S. ___ (2023) (slip op., at 19); 15 U.S.C. \u00a71125(c)(3)(A)(ii).<\/p>\n [19]<\/a> 599 U.S. ___ (2023) (slip op., at 20) (See App. to Pet. for Cert. 105a at 8\u20139, 17\u201318.)<\/p>\n [20]<\/a> 599 U.S. ___ (2023) (slip op., at 20)<\/p>\n [21]<\/a> 599 U.S. ___ (2023) (Sotomayor, J. concurring) (slip op. concurrence., at 1).<\/p>\n [22]<\/a> 599 U.S. ___ (2023) (Gorsuch, J. concurring) (slip op. concurrence., at 1).<\/p>\n