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<i>Jack Daniel’s Properties, Inc. v. VIP Products LLC</i>: The Supreme Court Corrects Course on <i>R <i>Jack Daniel’s Properties, Inc. v. VIP Products LLC</i>: The Supreme Court Corrects Course on <i>R

Jack Daniel’s Properties, Inc. v. VIP Products LLC: The Supreme Court Corrects Course on Rogers Test

On June 8, 2023, the Supreme Court of the United States issued a unanimous opinion in Jack Daniel’s Properties, Inc. v. VIP Products, LLC. The grant of cert in this case seemed to indicate that the Court may be ready to reassess the balance between First Amendment freedom of expression and trademark rights. The Court’s narrow opinion did just that, clarifying that First Amendment concerns should yield to trademark rights where a defendant’s infringing use of a trademark is as a source identifier, rather than a different kind of message, such as a title of an artistic work. The Court further resolved an incongruous “non-commercial use” exception to the dilution statute for parodies, again balancing artistic expression against Congressional intent and coming out on the side of trademark owners. Justice Kagan wrote for the unanimous Court, with Justice Sotomayor writing a concurrence joined by Justice Alito to express concern regarding the use of survey evidence in trademark infringement cases involving parodies, and Justice Gorsuch concurring (joined by Justices Thomas and Barrett) to express concern about the validity of the Rogers v. Grimaldi framework—while noting that the Court’s narrow opinion left that issue for another day. 

Background—The Bad Spaniels Squeaker Toy

In July 2013, VIP Products launched the “Bad Spaniels” squeaker toy as part of its “Silly Squeakers” collection of dog toys. VIP Prods. LLC v. Jack Daniel’s Props, Inc., 953 F.3d 1170, 1172 (9th Cir. 2020). The toy is shaped like a Jack Daniel’s bottle, but instead of the signature line, “Old No. 7 Brand Tennessee Sour Mash Whiskey,” the wording on the Bad Spaniels toy says, “the Old No. 2 on your Tennessee Carpet.” Id. The toy also replaced the words “40% alc. by vol. (80 proof)” with “43% poo by vol.” and “100% smelly.” After receiving a cease-and-desist letter, VIP brought a declaratory judgment action against Jack Daniel’s, seeking judgment that Bad Spaniels neither infringed nor diluted Jack Daniel’s trademarks. Jack Daniel’s counterclaimed for infringement and dilution.

Courts’ Decisions Below

The district court found that VIP was using BAD SPANIELS as a trademark, to designate the source of its own product, and further found that there was a likelihood of confusion between the Bad Spaniels toy and Jack Daniel’s trademarks and trade dress. The district court further found that VIP’s unauthorized use of Jack Daniel’s trademarks and trade dress constituted dilution by tarnishment, by creating a negative association between Jack Daniel’s famous trademarks and “the Old No. 2,”—i.e., dog excrement. In reaching these conclusions, the district court rebuffed VIP’s entreaty to afford it the protection of the Rogers v. Grimaldi test, finding that the test did not apply because VIP was using the trademarks as trademarks to identify source, and not for some other artistic or expressive purpose. 

On appeal, the Ninth Circuit reversed on both issues. It found that the Rogers threshold test—which asks the challenged use of the mark has any artistic relevance to the underlying work, and if so, whether use of the mark explicitly misleading as to source—did apply to the trademark infringement claims, because the dog toy “communicates a humorous message,” and remanded to the district court to conduct the Rogers analysis. On the issue of dilution, the Ninth Circuit held that the parodic nature of VIP’s use of the Jack Daniel’s marks entitled it to the protection of the “non-commercial use” exclusion under 15 U.S.C. § 1125(c)(3)(C). On remand, the district court found that VIP’s use was protected under the Rogers test and granted judgment in favor of VIP on infringement. 

The Supreme Court’s Holding Regarding Application of Rogers

The first question the Supreme Court addressed is whether the Rogers test applies when an alleged infringer uses a trademark “in the way the Lanham Act most cares about: as a designation of source for the infringer’s own goods.” Here, VIP was using the recognizability of JACK DANIEL’S in marketing its own products under the BAD SPANIELS trademark, and consumer confusion—the “cardinal sin” of trademark law—had apparently occurred. Taking a narrower view than urged by Jack Daniel’s, the Court held that the Rogers test—designed to protect artistic expression—does not apply in this context. In the Court’s view, Rogers’ application is properly cabined to non-trademark uses of a mark as opposed to for source identification. Where a mark is being used as a trademark, a defendant “must meet an infringement claim on the usual battleground of ‘likelihood of confusion.’” 

In so holding, the Court rejected the Ninth Circuit’s finding that because the BAD SPANIELS dog toy appears to convey a “humorous message,” it deserves Rogers’ protection. The Supreme Court found this to be a gross expansion of Rogers, which could led to Rogers’ “tak[ing] over much of the world.” Regarding concern for artistic expression and First Amendment principles, the Court noted: “When a mark is used as a mark (except, potentially, in rare situations), the likelihood-of-confusion inquiry does enough work to account for the interest in free expression.” As VIP had specifically pleaded that it both owned and used the BAD SPANIELS trademark and trade dress for its squeaky dog toy, and this allegation was supported by the record, the Court remanded the infringement question back to the district court to conduct the likelihood-of-confusion analysis.

The Supreme Court’s Holding Regarding Interpretation of the Dilution Statute as to Parodies

The second issue addressed by the Court, “more easily dispatched, concerns Jack Daniel’s claim of dilution by tarnishment (for the linkage of its whiskey to less savory substances).” The Ninth Circuit had dismissed Jack Daniel’s dilution claim based on the “non-commercial use of a mark” exclusion from dilution liability codified at 15 U.S.C. § 1125(c)(3)(C). That finding relied on a per se application of the notion that all parody is “non-commercial use” and therefore noninfringing fair use. The Court found that this approach “effectively nullif[ied] Congress’s express limit on the fair-use exclusion for parody” found at 15 U.S.C. § 1125(c)(3)(A), which itself is subject to a limitation that it does not apply when the use is “as a designation for source for the person’s own goods or services.” The Court thus concluded that parody is exempt from dilution liability “only if not used to designate source.” As established with respect to the infringement question, VIP was using BAD SPANIELS and the Bad Spaniels trade dress as a trademark to identify the source of its own product. Therefore, the Court held that VIP “could not benefit from the fair-use exclusion for parody.”

The Future of Rogers in Peril? 

The Court stressed that its opinion in Jack Daniel’s is narrow and did not address “whether the Rogers test is ever appropriate.” For non-source identifying uses, such as titles of artistic works, Rogers may continue to provide the appropriate framework to balance First Amendment rights against the rights of trademark owners (although Justice Gorsuch’s concurrence seems to foreshadow a potential future evisceration of the standard). Jack Daniel’s does represent a victory for trademark owners, however, in that it provides a bulwark against further expansion of that test into matters that are properly resolved by the likelihood-of-confusion analysis. Trademark infringement plaintiffs now have a powerful authority to cite against defendants who might be inclined to seek Rogers’ protection, though it remains unclear whether Jack Daniel’s will preclude application of Rogers in cases where the defendant did not concede that the use of the mark was as a trademark and source indicator and the parties dispute the allegedly infringing use was “as a trademark” or “artistic expression.”

Special thanks to summer associate Cassidy Aranda for her contributions to this article. Cassidy is not yet admitted to practice in any jurisdiction.

This publication is intended for general information purposes only and does not and is not intended to constitute legal advice. The reader should consult with legal counsel to determine how laws or decisions discussed herein apply to the reader's specific circumstances.

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