The principal purpose of a trademark is to identify the source of a good or a service. Holders of marks registered with the United States Patent and Trademark Office under the Lanham Act (also referred to as the Trademark Act of 1946) also acquire certain federal rights and protections. Chief among them are the exclusive right to use the mark in commerce; the right to bring an infringement action; and in the case of a famous mark, the right to bring a dilution action.
The gravamen of an infringement action is the “likelihood of confusion” by consumers of the source of the good or service. For famous marks, a holder can also bring an action for dilution by blurring or by tarnishment, regardless of the presence or absence of actual or likely confusion, of competition, or of actual economic injury. Under the Lanham Act, a famous mark is defined as one that is “widely recognized by the general consuming public of the United States as a designation of source of the goods or services of the mark’s owner.”
VIP Products manufacturers a squeaky, chewable dog toy marketed as Bad Spaniels. It is designed to look like a bottle of Jack Daniel’s whisky. Jack Daniel’s demanded that VIP stop selling Bad Spaniels. VIP filed suit for declaratory judgment that Bad Spaniels neither infringed nor diluted Jack Daniel’s trademark or trade dress rights. Jack Daniel’s counterclaimed for trademark infringement and dilution. VIP’s defense was that Jack Daniel’s failed to meet the threshold use showings for infringement set as forth under the so-called Rogers test and that use of the marks fell under the fair use exclusion to dilution under the Lanham Act.
In the case Rogers v. Grimaldi, the Second Circuit developed a test to balance the rights of a mark holder against the First Amendment right of artistic expression. The Second Circuit held that the “Lanham Act does not bar a minimally relevant use of a celebrity’s name in the title of an artistic work where the title does not explicitly denote authorship, sponsorship, or endorsement by the celebrity or explicitly mislead as to content.” If the Rogers test is met by use of the mark, the use is not infringing.
After considering VIP’s use of Jack Daniel’s trademarks and trade dress the Supreme Court narrowed the application of the Rogers test. The Court held that the Rogers test does not apply when the challenged use of a mark is as a designation of the source for the infringer’s own goods, i.e., when the use of the mark is as a mark as intended under the Lanham Act. Similarly, the Court held that the fair use exclusion to a dilution claim does not shield parody or other commentary when its use of a mark is source-identifying. Both holdings turned on whether the complained of use of a mark is serving a source-designation function as envisioned under the Lanham Act.
A copy of Jack Daniel’s Properties, Inc. v. VIP Products LLC is available at: https://spelusolawoffice.com/wp-content/uploads/2023/06/22-148_3e04.pdf.