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Pooch Over Hooch: Why Parody Prevailed in VIP Products, LLC v. Jack Daniel’s Properties, Inc.

By: Hannah Hall

Introduction

Jack Daniel’s Properties, Inc. (Jack Daniel’s) has petitioned for certiorari after losing in the Ninth Circuit.[i] The court held that a parodic imitation of the famous whiskey company’s iconic bottle in the form of a dog toy was entitled to First Amendment protection as an expressive work and did not impinge on Jack Daniel’s rights as a trademark holder.[ii] Big brand owners are uniting behind Jack Daniel’s to ask the Supreme Court to throw them a bone, casting the Ninth Circuit decision as a dramatic extension of past holdings.[iii] But is it? A reflection on the policy goals behind trademark suggests the decision is consistent with existing trademark law and that Jack Daniel’s may be begging for too much.

Trademark policy, generally

Trademarks are symbols used to indicate the source or brand of a good on the market.[iv] Consumers benefit from reliable trademarks, because trademarks reduce transaction costs; if a symbol can be counted on to accurately indicate a product’s source, communicating about and distinguishing between goods that might otherwise seem similar becomes easier.[v] If products can be reliably distinguished by source over time, producers are incentivized to maintain high quality standards and consistency between products in order to maintain a good reputation.[vi] Brands increase competition between producers, and over time this competition leads to better products being available on the market.[vii] Trademarks then become a shorthand way of indicating not only a product’s source, but also its quality or features. Finally, consumers benefit simply from the time they are able to save by not having to research or inspect every purchase (at least once they identify a trusted brand).[viii]

Developing a brand also has inherent advantages for a producer, most fundamentally in giving them the ability to distinguish their product from others and build a reputation.[ix] These advantages also come with a cost – branding and reputation building requires resources after all.[x] The policy goal of preventing consumer confusion and promoting competition leads to protective law for trademarks that also helps ensure that companies see the benefits of their investment. Many scholars go further to argue that protecting the property interest of brand owners in their trademarks is and should be a goal of trademark law beyond what is already secured by protecting consumer interests.[xi] Fairness and the prevention of free-riding provide much of the fuel for this policy goal.[xii] But it is fundamentally important to remember that intellectual property law is largely the result of a balancing act between promoting economic activity and preventing its suffocation.[xiii]

It’s this second goal of protecting a trademark owner’s property interests that primarily results in cases like VIP Products, LLC v. Jack Daniel’s Properties, Inc.[xiv] For years, major brands have been trying to convince courts that an injustice is done when parody producers are allowed to sell their wares.[xv] These parodies, after all, would not be possible if the trademark holders hadn’t invested years of money and effort into developing iconic products. Major brands argue that companies selling humorous imitations are just free riders, profiting primarily off of the work of others;

The Case

VIP Products, LLC (VIP Products) is the maker of a line of vinyl novelty pet toys called “Silly Squeakers®” which playfully imitates over 30 popular beverages from sodas to alcoholic drinks.[xvi] Each toy in the line shares many of the physically distinctive features of their more famous counterparts, with the text on the bottles and cans replaced by various pet-related puns. One of the famous bottles spoofed by the company is Jack Daniel’s Tennessee Whiskey, which is recognizable by its square bottle, black label, and old fashioned looking white text.[xvii] The “Bad Spaniels” dog toy not only includes all of these elements, but also converts much of the bottle’s text into jokes referencing a dog relieving itself on a “Tennessee carpet.”[xviii] Perhaps understandably, the folks at Jack Daniel’s were not too amused by the product.

After receiving a cease and desist letter from Jack Daniel’s, VIP Products decided instead to seek a declaratory judgment stating either that their product did not infringe the trademark rights held by Jack Daniel’s or that the trademark was invalid in the first place.[xix] This is not the first time VIP Products has dealt with legal challenge to items on its Silly Squeakers line.[xx] The District Court ruled in favor of Jack Daniel’s on all counts, relying on Tommy Hilfiger Licensing, Inc. v. Nature Labs, LLC to suggest that “somewhat non-expressive commercial product[s]” the First Amendment should either not apply or should be balanced against trademark holder interests. [xxi] The Ninth Circuit reversed on the issue of whether the toy should be considered an expressive work, thereby entitling it to First Amendment protection – sidestepping traditional infringement analysis and the issue of parody almost altogether.[xxii]Categorizing the toys as expressive works meant that they also defeated the tarnishment claim.[xxiii]

Analysis

The Ninth Circuit clearly considered the free expression issue to be the critical point of its decision. Indeed, this is the area where their analysis technically diverges from other circuits.[xxiv] For novelty commercial items like dog toys, the amount or depth of speech a parody embodies may be small. VIP Products argued that the expressive goal of its products was to comment on “the humanization of the dog in our lives” and on “corporations [that] take themselves very seriously.”[xxv] One can question whether phrases such as “43% POO BY VOL.”[xxvi] really communicate these messages, but the court refrained from artistic judgement, stating that “‘[a] work need not be the expressive equal of Anna Karenina or Citizen Kane’ to be considered expressive.”[xxvii] The reviewing court also quickly disposed of the tarnishment claim: First, by explaining that commercial products can indeed be expressive works and, second, by concluding that since the toys had at least a noncommercial expressive aspect, they could not have tarnished the Jack Daniel’s brand.[xxviii]

The Court’s analysis seems at first to open a large loophole for jokesters who wish to make a quick profit at the expense of large companies.[xxix] A closer look suggests that, at least in the view of the Ninth Circuit, the decision does very little to enlarge whatever “loophole” was already there.[xxx] The Court was clearly aware of the similarity between their free expression concern and the concern for the public utility of parody and likely considers the First Amendment protection subject to the same qualifications.[xxxi] In other words, their First Amendment point is largely another expression of the same idea previous cases have endorsed: that the public has an interest in allowing parodic commentaries on trademarked goods to exist, which must be balanced against the public interest of preventing confusion.[xxxii] Even a First Amendment protected expression in the form of a commercial good may still violate trademark law if it is likely to cause confusion, and the Ninth Circuit decision still leaves that argument open for trademark holders.

It is clear is that courts see the second policy goal of trademark law – to protect the property interests of trademark holders – as inextricable from the first policy goal – to preserve the benefits of trademark to consumers. Companies do not often win on the second argument alone, and sometimes they lose even if they present some evidence of potential confusion.[xxxiii] If  there is demand in the market for parody dog toys, and the toys are not causing confusion, it makes sense that someone ought to be making them. 

Conclusion

On the tightrope which all of intellectual property law walks, between encouraging and stifling valuable economic activity, protecting major brands from parodies would be a step too far in favor of established brands. But this is the same rule as always. The Ninth Circuit’s ruling is just another acknowledgement of this policy assessment in the form of a First Amendment argument. Trademark holders don’t need to worry that their legal protections have gone to the dogs until a court explicitly says otherwise.


[i] See generally VIP Prod. LLC v. Jack Daniel’s Props., Inc., 953 F.3d 1170 (9th Cir. 2020).

[ii] Id.

[iii] Donahue, supra note i.

[iv] 1 J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition § 2:2 (5th ed. 2020).

[v] Id. at § 2.3 and §2.5.

[vi] Id. at § 2.4.

[vii] Id.

[viii] Id. at § 2.5.

[ix] Id. at § 2.4.

[x] See Lydia Pallas Loren & Joseph Scott Miller, Intellectual Property Law: Cases and Materials 501 (6th ed. 2018).

[xi]  McCarthy, supra note v.

[xii] Id. at § 2.4.

[xiii] Loren & Miller, supra note x, at 30 (noting that “[t]hroughout intellectual property law, we confront the need to balance free competition with the necessary incentives for creation.”).

[xiv] See VIP Prod. LLC v. Jack Daniel’s Props., Inc., 953 F.3d 1170 (9th Cir. 2020).

[xv] Seee.g., Tommy Hilfiger Licensing, Inc. v. Nature Labs, LLC, 221 F. Supp. 2d 410 (S.D.N.Y. 2002).

[xvi] See MYDOGTOY.COM, https://mydogtoy.com/silly-squeaker (last visited Nov. 8, 2020).

[xvii] See Jared Kagan, Bad Spaniels Make Bad Law: Ninth Circuit Says Dog Toy is an Expressive Work Entitled to First Amendment Protection, IP Watchdog (Apr. 3, 2020) (comparing the two products side by side).

[xviii] Id.

[xix] See Bill Donahue, Rivals, TM Expert Urge Justices to Hear Jack Daniel’s Case, Law360 (Oct. 19, 2020), https://www.law360.com/articles/1320889/rivals-tm-experts-urge-justices-to-hear-jack-daniel-s-case.

[xx] Anheuser-Busch, Inc. v. VIP Prod., LLC, 666 F. Supp. 2d 974 (E.D. Mo. 2008).

[xxi] VIP Prod. LLC v. Jack Daniel’s Props., Inc., 953 F.3d 1170 (9th Cir. 2020) (quoting Tommy Hilfiger Licensing, Inc. v. Nature Labs, LLC, 221 F. Supp. 2d 410 (S.D.N.Y. 2002) at 415).

[xxii] See Eric Goldman, Ninth Circuit Rallies in Defense of a Parody Dog Toy–Bad Spaniels v. Jack Daniel’s,Technology & Marketing Law Blog (Apr. 2, 2020), https://blog.ericgoldman.org/archives/2020/04/ninth-circuit-rallies-in-defense-of-a-parody-dog-toy-bad-spaniels-v-jack-daniels.htm.

[xxiii]Id.

[xxiv] Seee.g., Tommy Hilfiger Licensing, Inc. v. Nature Labs, LLC, 221 F. Supp. 2d 410 (S.D.N.Y. 2002).

[xxv] Goldman, supra note xxiii.

[xxvi] VIP Prod. LLC v. Jack Daniel’s Props., Inc., 953 F.3d 1170 (9th Cir. 2020) at 1172.

[xxvii] Kagan, supra note xviii.

[xxviii] Goldman, supra note xxiii.

[xxix] See Marc E. Mayer & Theresa B. Bowman, Freedom of Squeak: The Ninth Circuit Finds First Amendment Protection For Parody Dog Toy, MSK Blog, (Apr. 3, 2020), https://blogmsk.com/2020/04/03/freedom-of-squeak-the-ninth-circuit-finds-first-amendment-protection-for-parody-dog-toy/#more-3566.

[xxx] See Jessica L. Hannah, Good Day for Bad Spaniels: Ninth Circuit Holds Dog Toys Do Not Infringe Jack Daniel’s Marks, Incontestable Blog (Apr. 9, 2020) https://www.finnegan.com/en/insights/blogs/incontestable/good-day-for-bad-spaniels-ninth-circuit-holds-dog-toys-do-not-infringe-jack-daniels-marks.html, (noting the court’s approving reference to the fourth circuit’s decision Haute Diggity Dog, which rested more squarely on parodic grounds).

[xxxi] Mayer & Bowman, supra note xxx.

[xxxii] See Tommy Hilfiger Licensing, Inc. v. Nature Labs, LLC, 221 F. Supp. 2d 410 (S.D.N.Y. 2002) at 414 (expressing the idea that even if free expression rights apply to commercial parody products, these rights may be balanced against the policy goal of avoiding consumer confusion).

[xxxiii] See Louis Vuitton Malletier S.A. v. Haute Diggity Dog, LLC, 507 F.3d 252 (4th Cir. 2007).

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