Successful Parody

(IPRinfo 4/2007)

Graeme Dinwoodie
Professor, Chicago-Kent College of Law/
University of London, Queen Mary College

In 2006, the U.S. Congress enacted the Trademark Dilution Revision Act of 2006 (”TDRA”). This was a legislative attempt to reverse a United States Supreme Court decision that had eviscerated the federal dilution protection enacted in 1995 and to clarify a number of its ambiguities.

Thus, the TDRA adopted a likelihood of dilution as standard, abrogating the holding of the Supreme Court in V Secret v. Moseley, which had required ”actual dilution” in order to make out a dilution claim. In addition, the TDRA expressly endorsed tarnishment and blurring as forms of dilution, and clarified that dilution protection is available for marks that have acquired distinctiveness.

Since the new law became effective, a number of lower court decisions have been handed down. On November 13, 2007, however, the first appellate ruling on the new law was handed down: Louis Vuitton Malletier S.A. v. Haute Diggity Dog, LLC. The case involved at least two provisions of the statute that were hotly debated at the time of its enactment.

Chewy Vuiton toys for dogs are formed like handbags
Louis Vuitton owns registered trademarks for ”LOUIS VUITTON” in connection with luggage and ladies’ handbags; for a stylized monogram of ”LV,” in connection with traveling bags and other goods; and for various handbag designs. The handbag designs have attracted immediate and extraordinary media attention and publicity in a number of celebrity magazines.
The defendant, Haute Diggity Dog, sells a line of pet chew toys and beds whose names parody elegant high-end brands of products such as perfume, cars, shoes, sparkling wine, and handbags. These include¬ – in addition to Chewy Vuiton (LOUIS VUITTON) – Chewnel No. 5 (Chanel No. 5), Furcedes (Mercedes), Jimmy Chew (Jimmy Choo), Dog Perignonn (Dom Perignon), Sniffany & Co. (Tiffany & Co.), and Dogior (Dior).

Louis Vuitton alleged that the defendant’s sale of dog chew toys that imitated and parodied the plaintiff’s mark and handbag design amounted to blurring and tarnishment of the plaintiff’s marks. The tarnishment claim, however, failed for lack of evidence. The district court had held that the plaintiff’s mark was not likely to be blurred by the plaintiff’s dog toy product because it was a parody.

Parody not an automatic defence against claims
The appeals court held that the lower court misapplied the TDRA in concluding that simply because Haute Diggity Dog’s product was a parody it could not dilute the plaintiff’s mark.

The court noted that parody is not ”automatically a complete defense to a claim of dilution by blurring where the defendant uses the parody as its own designation of source, i.e., as a trademark.” Under the statute’s plain language, parodying a famous mark is protected by the fair use defense only if the parody is not ”a designation of source for the person’s own goods or services.”

However, the court held that the parodic nature of the defendant’s use could still be relevant to whether its use amounted to blurring, which the statute defines as the ”association arising from the similarity between a mark or trade name and a famous mark that impairs the distinctiveness of the famous mark”.

The plaintiff had argued that, prior to the defendant’s use, its famous VUITTON marks were unblurred by any third party trademark use. Allowing the defendants to become the first to use similar marks would ”obviously blur and dilute the Vuitton marks”. The Court of Appeals rejected this argument.

Court must consider all relevant factors
To determine whether a junior mark is likely to dilute a famous mark through blurring, the TDRA directs the court to consider all factors relevant to the issue. Six factors are enumerated in the statute:
(i) The degree of similarity between the mark or trade name and the famous mark.
(ii) The degree of inherent or acquired distinctiveness of the famous mark.
(iii) The extent to which the owner of the famous mark is engaging in substantially exclusive use of the mark.
(iv) The degree of recognition of the famous mark.
(v) Whether the user of the mark or trade name intended to create an association with the famous mark.
(vi) Any actual association between the mark or trade name and the famous mark.

The court held that the parodic nature of the defendant’s use suggests both that the user of the mark did not intend to create an association with the famous mark and that the use did not create any actual association between the defendant’s use and the famous mark. (Factors v and vi).

”While a parody intentionally creates an association with the famous mark in order to be a parody, it also intentionally communicates, if it is successful, that it is not the famous mark, but rather a satire of the famous mark.”

A famous mark not impaired by parody
Moreover, the court held that because the famous mark is particularly strong and distinctive, it becomes more likely that a parody will not impair the distinctiveness of the mark. (Factors (ii)-(iv)). A successful parody will strengthen, rather than blur, the distinctiveness of the famous mark as a unique identifier of its source.

Thus, the court held that, although the defendant’s use would not satisfy the parody defense, the parodic nature of the use would help to defeat the assertion that it was a prima facie violation of the dilution provision.

The opinion of the Fourth Circuit suggests perhaps a continuing judicial discomfort with the breadth of the dilution cause of action. The 2006 legislative reforms appear unlikely to assuage that discomfort. The significance of the opinion might, however, depend upon the extent to which the court’s analysis of blurring factors will be applied beyond the content of parodies.

United States Court of Appeals for the Fourth Circuit, November 13, 2007
No. 06-2267. Louis Vuitton Malletier S.A., v. Haute Diggity Dog, LLC;
(Appeal from the United States District Court for the Eastern District of Virginia, at Alexandria.(1:06-cv-00321-JCC))