Jack Daniel's Properties, Inc. v. Vip Products LLC

Facts

P makes a squeaky, chewable dog toy designed to look like a bottle of Jack Daniel’s whiskey. On the toy, for example, the words “Jack Daniel’s” become “Bad Spaniels.” And the descriptive phrase “Old No. 7 Brand Tennessee Sour Mash Whiskey” turns into “The Old No. 2 On Your Tennessee Carpet.” d was not amused. P owns trademarks in the distinctive Jack Daniel’s bottle and in many of the words and graphics on the label. P believed Bad Spaniels had both infringed and diluted those trademarks. D posits that Bad Spaniels had infringed the marks by leading consumers to think that Jack Daniel’s had created, or was otherwise responsible for, the dog toy. And Bad Spaniels had diluted the marks by associating the famed whiskey with, well, dog excrement. P is a dog toy company, making and selling a product line of chewable rubber toys that it calls “Silly Squeakers.” Most of the toys in the line are designed to look like-and to parody-popular beverage brands. The line includes Dos Perros (cf. Dos Equis), Smella Arpaw (cf. Stella Artois), and Doggie Walker (cf. Johnnie Walker). D has registered trademarks in all those names, as in the umbrella term “Silly Squeakers.” P added the Bad Spaniels toy to the line. P did not apply to register the name, or any other feature of, Bad Spaniels. But according to its complaint (further addressed below), P both “own[s]” and “use[s]” the “‘Bad Spaniels’ trademark and trade dress.” The Bad Spaniels’ trade dress is designed to evoke a distinctive beverage bottle-with-label. Bad Spaniels is about the same size and shape as an ordinary bottle of Jack Daniel’s. The faux bottle, like the original, has a black label with stylized white text and a white filigreed border. The words “Bad Spaniels” replace “Jack Daniel’s” in a like font and arch. Above the arch is an image of a spaniel. (This is a dog toy, after all.) Below the arch, “The Old No. 2 On Your Tennessee Carpet” replaces “Old No. 7 Tennessee Sour Mash Whiskey” in similar graphic form. The small print at the bottom substitutes “43% poo by vol.” and “100% smelly” for “40% alc. by vol. (80 proof ).” The back of the toy is packaged with a disclaimer: “This product is not affiliated with Jack Daniel Distillery.” In the middle are some warnings and guarantees. And at the top, most relevant here, are two product logos-on the left for the Silly Squeakers line, and on the right for the Bad Spaniels toy. D sent P a letter demanding that it stop selling the product. P brought suit, seeking a declaratory judgment that Bad Spaniels neither infringed nor diluted D’s trademarks. D counterclaimed under the Lanham Act for both trademark infringement and trademark dilution by tarnishment. P moved for summary judgment. P contended that the so-called Rogers test requires dismissal of an infringement claim at the outset unless the complainant can show one of two things: that the challenged use of a mark “has no artistic relevance to the underlying work” or that it “explicitly misleads as to the source or the content of the work.” Rogers v. Grimaldi. Because D could make neither showing, P argued, the likelihood-of-confusion issue became irrelevant. P urged that D could not succeed on a dilution claim because Bad Spaniels was a “parody[ ]” of Jack Daniel’s, and therefore made “fair use” of its famous marks. The District Court rejected both contentions for a common reason: because P had used the cribbed Jack Daniel’s features as trademarks-that is, to identify the source of its own products. It held that when “another’s trademark is used for source identification”-as the court thought was true here-the threshold Rogers test does not apply. Parodies fall within that exclusion, the court explained, only when the uses they make of famous marks do not serve as “a designation of source for the [alleged diluter’s] own goods.” The District Court found that consumers were likely to be confused about the source of the Bad Spaniels toy. The court thought that the toy, by creating “negative associations” with “canine excrement,” would cause D “reputational harm.”The Court of Appeals reversed holding that the First Amendment compels a stringent threshold test when an infringement suit challenges a so-called expressive work. That test knocked out D’s claim against Bad Spaniel, whatever the likelihood of confusion. D's dilution claim also failed because trademark law provides that the “noncommercial” use of a mark cannot count as dilution. 15 U. S. C. §1125(c)(3)(C). The Bad Spaniels marks communicated a message about Jack Daniel’s. On remand, the District Court found that D could not satisfy either prong of Rogers, and so granted summary judgment to P on infringement. D’s appealed, and the Ninth Circuit summarily affirmed. D appealed. 

Issues

Rule of Law

Holding and Decision

Legal Analysis

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