Trade dress: going to the dogs?

For this article we will focus on trademark law, trade dress law, whiskey, and silly squeakers. Sounds like fun, right?

Trademark and trade dress 101

First , a little background before the real fun starts.

You are familiar with trademarks. They indicate the source of products. Trademarks rights are gained through use of the mark. No use means no rights. But if the owner has trademark rights, they can be further protected by registration. Registration can be at the state or federal level. Federal registrations provide the most protection. They are done at the U. S. Patent and Trademark Office. The owner of the mark has to prove entitlement to trademark rights to obtain a registration.

Generally, using a trademark that confuses the public as to the source of a product is trademark infringement. The main focus of trademark law is protecting purchasers from being fooled about where the product comes from.

Trademark law also protects the value of famous marks by preventing trademark dilution. Dilution can be either by blurring or tarnishment. Blurring harms the mark by impairing the mark’s distinctiveness by using it on other goods. Coca Cola doesn’t make cars, but the mark would be diluted by blurring if a company began selling Coca Cola shoes.

Tarnishment harms the mark by associating it with another product. I am assuming, for example, Coca Cola would rather not have its mark used on toilets. That would tarnish it. Most folks are not likely to be confused into thinking Coca Cola made a car or toilet, but allowing another company to use the mark would likely blur or tarnish the mark.

Trade dress is a particular form of trademark. It can include the design and shape of the materials in which a product is packaged, or the design and shape of the product itself. It could include both. Trade dress cannot protect functional features; only patents can do that. To be protected, the trade dress of a product must also have obtained “secondary meaning.” That requires proof that customers associate the products appearance with the source.  Think the shape of a Coca Cola bottle. You know where the drink came from even if you don’t read the label.

The law forbids dilution of a famous trade dress. Trade dress can be registered as a trademark with the U.S. Patent and Trademark office.

Finally, trademark and trade dress rights must, in the right circumstances, give way to the First Amendment right of free expression.

Which brings us to the case of VIP Products LLC v. Jack Daniel’s Properties, Inc., 953 F.3d 1170 (9th Cir. 2020).

The Bad Spaniel’s Silly Squeaker dog toy case

We all know about Jack Daniel’s. It’s famous for its whiskey.

VIP is not as famous. It makes dog toys. Dog owners usually have a sense of humor. So, they are likely to think it is funny to take a famous thing like a Jack Daniel’s bottle and turn it into a dog toy, complete with a squeaker.  And so was born the “Bad Spaniels Silly Squeaker” dog toy.

The toy is in the shape of a bottle of Jack Daniel’s Old No. 7 Black Label Tennessee Whiskey. But it’s a chew toy. To add to the fun, VIP uses some doggie humor. So, for the squeaker toy, “Jack Daniel’s” is replaced with “Bad Spaniels,” “Old No. 7” with “Old No. 2,” and alcohol content descriptions with “43% POO BY VOL.” and “100% SMELLY.” Lest anyone think Jack Daniels was behind all this doggie humor, VIP put a label on the toy that said, “product is not affiliated with Jack Daniel Distillery.”

Many dog lovers will see the humor in VIP’s approach. But Jack Daniels apparently takes its whiskey and name more seriously than that. It demanded that VIP “cease all further sales of the Bad Spaniels toy.” That’s the way trademark lawyers put things when they really mean business.

Seeing that Jack Daniel's really meant business, VIP took the matter right to federal district court in Arizona. It asked the court to declare that the Bad Spaniels toy “does not infringe or dilute any claimed trademark rights” of Jack Daniel’s and that Jack Daniel’s trade dress and bottle design are not entitled to trademark protection. It also asked the court to cancel the mark Jack Daniel’s had registered for its bottle design.

The district court rules

The court ruled that Jack Daniel’s trade dress and bottle design were entitled to protection. That left Jack Daniel’s claims of dilution by tarnishment and whether Jack Daniels could establish the customer confusion needed to establish trademark infringement. After a bench trial, Jack Daniels won on both its dilution claim and trademark infringement claim. The court enjoined VIP from making or selling its Bad Spaniels dog toy.

The Ninth Circuit begs to differ

The Ninth Circuit reversed the decision against VIP on infringement and tarnishment.

It did agree that Jack Daniel’s had trademark and trade dress rights. But, where an expressive work is involved, trademark rights must give way to First Amendment rights. So, a trademark owner can establish infringement of an expressive work only if the plaintiff shows that the defendant’s use of the mark is either (1) “not artistically relevant to the underlying work” or (2) “explicitly misleads consumers as to the source or content of the work.”

But is a doggie chew toy, sold to make a profit, an expressive work?  Yes it is, said the court. To be an expressive work, the work – in this case the chew toy – just needs to communicate ideas or express a point of view. The court conceded that the Bad Spaniels Silly Squeaker” dog toy wasn’t exactly the Mona Lisa.  But it was enough that the toy had a “humorous message. ” It used word play to alter the serious phrase that appears on a Jack Daniel’s bottle— “Old No. 7 Brand” — with a silly message — “The Old No. 2.”

Let me digress here and note that humor almost never seems funny when it is being explained. And humor never seems very funny at all when a court explains it. But, still, the Ninth Circuit found an attempt at humor which was good enough to make the squeaky dog toy an expressive work.

And it doesn’t matter that the dog toy was sold commercially. After all, most books and movies – most or all of which are expressive works – are sold commercially. Jack Daniel’s didn’t make the showing necessary to prove infringement by an expressive work, so its trademark claim failed.

The court made short work of the dilution by tarnishment claim. Where a work is “non-commercial” in nature, a claim for dilution by tarnishment cannot survive. And a work can be “non-commercial" even if it is used to sell a product.  If it does more than propose a commercial transaction, and contains some “protected expression,” it qualifies as non-commercial. The Bad Spaniel Silly Squeaker used Jack Daniel’s bottle design and trade dress to “convey a humorous message.” That was good enough to foreclose a claim for dilution by tarnishment.

Enter the Supreme Court

The Supreme Court only grants somewhere between 1 and 3 percent or so of cases presented to it for review each year.  Jack Daniel’s got lucky. The Supreme Court decided to review the Bad Spaniels Silly Squeaker case.

The Ninth Circuit didn’t engage in long discussions of its disposition of the trademark infringement and dilution claims.   It just said that, if the work is expressive, the First Amendment can overcome trademark rights and that expressive works are non-commercial and so are not subject to a dilution claim.

Apparently, the Supreme Court isn’t quite so sure of that. It decided to review two legal issues:

1. 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.

This could get interesting. Stay tuned.