JACK DANIELS GOT “BAD DANIELS” IN THE DOG HOUSE
Supreme Court puts parody defense on a leash in newest decision: Jack Daniels Properties Inc., v. VIP Products LLC
On June 8, 2023, in a unanimous decision, the Supreme Court (“The Court”) of the United States held in favor of Jack Daniel’s trademark infringement and dilution claims against dog-toy manufacturer, VIP Products. The Court determined that, while VIP Product’s “Bad Daniels” toy is certainly a parody, it too closely resembles the original product to not cause a likelihood of confusion.
Takeaways:
The Jack Daniel’s decision aligns with the recent Supreme Court Warhol decision favoring commerce over freedom of expression.
Creators using others’ trademarks in parodies and other types of creative expression now face increased prospects of legal liability for trademark infringement.
Summary of the Facts
Jack Daniels is a famous liquor brand and the largest manufacturer of whiskey in the U.S.
VIP Products is the second largest manufacturer of dog toys in the U.S. who often parodies famous brands in their products.
VIP Products released a dog toy parodying the famous whiskey bottle. The toy closely resembled the original whiskey bottle design, but replaced notorious tag lines “Jack Daniels” with “Bad Daniels” and “Old No. 7 Tennessee Sour Mash Whiskey” with “Old No. 2 on your Tennessee carpet.”
Upon VIP’s product launch, Jack Daniels contacted the company and demanded they take the product down.
VIP Products filed suit, seeking declaratory judgment that they did not infringe Jack Daniel’s trademark and arguing their use of the mark was protected by the Rogers test, a precedential ruling upholding First Amendment rights as a defense to trademark infringement.
Jack Daniels counterclaimed against VIP Products for trademark infringement and dilution by tarnishment, a form of trademark infringement generally used for famous brands wherein the allegation rests on the infringing mark reducing the distinctiveness of the famous mark.
VIP Products responded their product was a “spoof” and therefore protected by the First Amendment.
Legal Procedure
U.S. District Court for the District of Arizona (The Trial Court) finds in Jack Daniel’s favor, barring VIP Products from producing more “Bad Daniels” toys.
The U.S. Court of Appeals for the 9th Circuit reverses, and finds in favor of VIP Products based on a Rogers Test analysis.
The Supreme Court of the United States reversed and remanded to determine whether there is a factual finding of confusion between the two marks. While the dog toy was a parody in the expressive sense, VIP Products was clearly using the whiskey bottle design in a commercial manner, creating a likelihood of confusion with Jack Daniel’s own product.
The Supreme Court’s decision definitively answered the question of whether creative expression has a role in trademark law. No, it does not. Copyright law dictates the protection of individual expressive works. Trademark law oversees the protection of commercial sourcing and identification. The Rogers test, from a prior 2nd Circuit decision, established that, when an “expressive element” is used in a trademark, the First Amendment affords protection to the infringer if the use was non-commercial in nature. VIP Products tried to assert this very defense, but the Court did not accept it.
While the “Bad Daniels” toy was a parody in appearance, it was not protectable under the First Amendment because it was used in a commercial manner. The crucial rule drawn from this decision is that a commercial nature overrides the expression evidenced in a parody. The reverse, historically, has been found in copyright law where the expressive element could override a commercial use. However, this case comes down a mere few months after another landmark decision for IP: Andy Warhol Foundation v. Goldsmith. Despite being a copyright case, the Supreme Court held Warhol’s commercial use to outweigh its expressive nature. Read more about that case here.
The trend in these two cases indicates the Supreme Court is blazing a new path for intellectual property rights holders, constricting expression in favor of protecting commerce. Notably, this case did not overturn the Rogers test; rather, it clarified the bounds of the analysis, potentially weakening the defense. Now, if a parody of a mark is linked to a commercial use, it will not be protected by either the First Amendment or a parody defense under the Rogers test. While these trends could weaken copyright protection for future creators who build off of others’ works, it will strengthen the positions of trademark and brand owners who can now expect to wield a strong hand against parodies in their cases against future infringers.
