Trademark & Copyright Law Blog : Intellectual Property Lawyers & Attorneys : Foley Hoag Law Firm : Washington D.C., Boston

A version of this article, which was co-authored by Anthony E. Rufo, was reprinted in the World Trademark Review.

How can the owners of famous trademarks enforce their rights without being given the dreaded “trademark bully” label? The answer lies in knowing where to draw the line, and in exercising diplomacy in letting people know when the line has been crossed.

Many brand owners tolerate minor third party uses of their marks, including unauthorized parodies, fan clubs and the like, which are undertaken in good faith. But brand owners must act to protect their rights when third parties go too far. Potential red flags include actual confusion, complaints from customers, impact on sales, and formal trademark filings by third parties. In these circumstances, a line has been crossed and trademark owners can and should consider taking action. To protect themselves from bullying accusations, however, trademark owners would do well to emphasize in all of their communications the specific “over the line” factors that drove them to action.

North Face’s 2009 lawsuit against the “South Butt” defendants illustrates these principles. The defendants claimed that their use of THE SOUTH BUTT name and “arc” logo on clothing was a parody of THE NORTH FACE. A parody defense can put brand owners in a difficult position, because no one wants to be perceived as not getting the joke. In fact, a savvy brand owner knows that embracing those in the marketplace who are poking a little fun can often make for excellent public relations. So why was filing suit the right thing for North Face to do? Because the defendants repeatedly tried to register THE SOUTH BUTT as a trademark for clothing, which could have potentially curtailed North Face’s own rights and made future policing efforts against third parties more difficult.

In contrast, the Coca-Cola fan site on Facebook did not cross any obvious lines - it was created by two guys who just happened to love Coke. So what did Coca-Cola do about these individuals representing its brand to millions of social media subscribers? It decided to make the Facebook fan page the “real thing” and sponsor its creators, inviting them to meet with Coca-Cola executives in Atlanta and collaborate on marketing initiatives. This was a brilliant (and popular) strategy because the Facebook page posed no commercial threat, and Coca-Cola was able to support its biggest fans rather than shut down their Facebook site.

So what can you learn from these examples as a brand owner? If an infringer crosses the line and you have to enforce your rights, try to stay ahead of the spin and make sure the public knows you were left with little choice. If no line is crossed, consider whether a marketing-driven approach might be preferable to legal action. While you may not be able to escape the “trademark bully” label in all situations, careful line-drawing and tailored communications can help you manage the risks and, hopefully, portray your brand enforcement efforts in a positive light.

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As reported recently, Facebook has dropped its suit against Lamebook, the subject of our prior blog entry, pursuant to a settlement agreement. This followed Facebook’s unsuccessful attempt to have the case transferred to its home turf in the Northern District of California.

According to the news report, Lamebook got to keep its name as part of the settlement, and did not even have to change its logo with the evocative “thumbs-down” icon and blue rectangle; all it had to do was add a not-so-prominent disclaimer at the top of its website at www.lamebook.com, and agree not to seek to register LAMEBOOK as a trademark. Presumably Facebook concluded that Lamebook’s parody defense was a winning hand, and (in the words of the song) “knew when to fold ‘em.”

As mentioned in a comment responding to our prior post by Prof. Jessica Silbey of Suffolk Law School, this suit was just one battle in a larger war in which Facebook is seeking to control a broad field of “-book” formative marks. Another, against the operators of the www.teachbook.com website, was dismissed on jurisdictional grounds this past May, but was quickly re-filed with the U.S. District Court for the Northern District of Illinois. That case is pending.

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Lamebook, LLC operates a website, www.lamebook.com, at which people can submit amusing (or merely “lame”) messages and photos appearing on facebook.com – its tag line is “the funniest and lamest of facebook.” (Warning: some of the content is funny or lame mainly because it is off-color.) The editors screen the submissions and remove identifying information before displaying them on the site in various categories (such as “TypOHs”), and make revenue selling advertising space (as of this writing, the site had an Alexa® U.S. traffic ranking of 1,302, and ads for AUTOZONE and well-known car manufacturers were prominently featured). Imagine a business analogous to “America’s Funniest Home Videos,” except with your Facebook “friends” choosing which of your pictures, videos and writings to submit to the show.

Following months of cease and desist letters and on-again, off-again settlement discussions, Lamebook recently filed suit (PDF) in federal district court in the Western District of Texas for a declaration of non-infringement and non-dilution. Not to be outdone, Facebook responded with an infringement and dilution suit in the Northern District of California.

Aside from the obviously derivative name, Facebook has other complaints about Lamebook’s functionality and trade dress: Lamebook uses a logo that is similar to Facebook’s (although having recently added a thumbs-down icon before the word), and offers “like this” and other features similar to Facebook functions. Facebook goes so far as to call the services on Lamebook’s site “the same as and/or related to the services provided by Facebook” (the former part of that characterization being a bit of a stretch). Lamebook responds that the mimicry of the name, logo and functionality are all part of the parody.

Lamebook faces at least two obstacles in establishing its parody defense. First, as discussed in this prior blog entry discussing the marks CHARBUCKS, CHEWY VUITON, and THE SOUTH BUTT, a mark does not fit into the statutory definition of parody unless it is used “other than as a designation of source for the person’s own goods or services.” 15 U.S.C. Section 1125(c)(3)(A). Since it fails this requirement, Lamebook’s service mark will be subject to the far murkier (and sometimes contradictory) standards articulated in prior cases dealing with parody and satire. There is an excellent discussion of these decisions in Anthony Fletcher’s recent article in The Trademark Reporter, titled “The Product with the Parody Trademark: What’s Wrong with CHEWY VUITON?” (INTA members can link to the article here.)

Second, in order to qualify as a parody, the mark must be used in order to target the subject mark in some fashion – not to merely use the mark as a “hook” for a parody about something else entirely. By analogy, under the copyright fair use doctrine (as discussed in this prior blog entry), one cannot change the lyrics to a copyrighted musical work to contain a political message unrelated to the song lyrics themselves, and then claim the work is parodic. Along these lines, a Facebook cease and desist letter attached to Lamebook’s complaint focuses on the case of Dr. Seuss Enterprises LP v. Penguin Books USA Inc., 42 USPQ2d 1184 (9th Cir. 1997), in which a book about the OJ Simpson case called The Cat NOT in the Hat! was found to be non-parodic, since it did not target Dr. Suess’ work in any way but merely used its imitation of the author’s title and style “to get attention” while commenting about something else entirely.

One might question whether this dispute is really analogous to the Dr. Seuss case. Commenting about the funny, disturbing or lame material on Facebook would seem far closer to commenting about Facebook itself, as opposed to using an author’s title and rhyming format to make a point about a criminal trial. How does one differentiate between commenting on the ubiquitous social medium that is Facebook, versus commenting on the content that appears on the medium?

Given that both sides reference lengthy prior discussions, the most likely outcome appears to be some form of settlement between the parties (perhaps involving a very prominent disclaimer). If the case progresses, however, it will be very interesting to see how the parody defense plays out.

It will also be interesting to see if Facebook raises – perhaps in the course of a dilution by tarnishing argument—privacy issues that are not addressed in either complaint. While YouTube videos are posted for the world to see, much Facebook content is available only to selected “friends” to see (even if those friends might number in the hundreds or thousands); neither the friend submitting the information nor Lamebook has permission to publish the content. While Lamebook obscures names and other identifying information, “scrambles” faces in photos and removes postings on request, some of these postings and photos might well be recognizable to people who know the author or subject before they are taken down. Might some people become more reluctant to post on Facebook as a result? More to the point of a dilution claim, might they form a negative impression of the Facebook brand? 

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In a bid to win the hearts and minds of voters, lately political candidates have touted, among other things, their musical predilections. In at least two recent cases, candidates have sanctioned the alteration of the lyrics, but not the tune, of some of their favorite music to shore up political support. The musicians who own the copyrights in those songs weren’t exactly thrilled.

All They Want To Do Is Campaign

In April 2009, various musicians, including Don Henley, sued Charles DeVore, who unsuccessfully sought the Republican nomination for a U.S. Senate seat currently held by Senator Barbara Boxer, for, among other things, infringing the musicians’ copyrights. The musicians alleged (PDF) that DeVore produced videos reworking the lyrics of the musicians’ songs “The Boys of Summer” and “All She Wants to Do Is Dance” into songs titled “The Hope of November” and “All She Wants To Do Is Tax,” which poked fun at President Obama, his supporters, and Senator Boxer. DeVore asserted that “The Hope of November” and “All She Wants To Do Is Tax,” constituted parodies, and were thus protected by the fair use doctrine. Specifically, DeVore maintained that the altered songs commented on political views conveyed in the songs. On cross-motions for summary judgment, the court disagreed (PDF), reasoning in large part that DeVore’s videos did not target Henley’s political views so much as they targeted views that may have been held by Henley (the court noted that Henley disputed DeVore’s assumption that he held liberal-leaning views, but explained that its inquiry focused on whether a work’s parodic character could reasonably be perceived).   DeVore recently apologized for using the musicians’ work without their permission and settled the matter for an undisclosed amount.

In another case this past January, Peter Paterno, an attorney for Joe Walsh, a guitarist for the Eagles, wrote to Joe Walsh (PDF), a Republican candidate for Congress, about the unlicensed use of his client’s song, “Walk Away,” in which the narrator ostensibly recounts his unsuccessful efforts to mend his relationship with an uninterested partner, to compose “Lead the Way,” which extolls Joe Walsh’s ability to “lead the way” in battle against Democratic policies and positions.  In the bitingly sarcastic letter, Paterno demanded that the candidate discontinue his unlicensed use of Walsh’s song.  Walsh refused, claiming that “Lead the Way” was a “parody song of the political process.” However, a “parody of the political process” standing by itself is insufficient to demonstrate the parodic nature of the work for purposes of a copyright infringement; rather, Walsh had to show that “Lead the Way” lampooned or commented on “Walk Away.” Perhaps having realized that his song had very little, if anything, to do with trying to fix a broken relationship, Walsh ultimately decided to take “Lead the Way” down from his website.

Fair Use Funny?

For purposes of a copyright infringement action, a work qualifies as a parody if it uses aspects of a copyrighted work to create a new work that comments on the underlying copyrighted work.

Owing to the limitation that a parody comment on an underlying copyrighted work, parodies enjoy a somewhat favored status under the fair use doctrine. This is because the four factors used to determine whether the fair use doctrine protects a putative parody—the purpose and character of the use, the nature of a copyrighted work, the amount copied, and the effect upon the potential market—typically weigh in favor of finding that an alleged parody constitutes a fair use since a parody by its very nature is transformative and expressive, requires significant borrowing from the underlying work, and the author of a copyrighted work will not likely license a work criticizing the author’s own work.

In contrast, satirical works, which use another’s work to comment on something other than the underlying work, do not necessarily fare as well under these factors because satirical works typically require greater justification for appropriating a copyrighted material. For this reason, would-be satirists often try to stretch the meaning or message ascribable to a copyrighted work in order to assert a parody-based fair use defense and avoid the heavier burden typically applied to satires.

Aren’t There Different Rules For Politicians Political Speech?

The fine distinction between satire and parody exists in a certain amount of tension with the relatively strong protections afforded political speech under the First Amendment.   Although copyright law does not proscribe the substance or ideas behind political messages, it does potentially entitle an author to enjoin the form in which a political message may be delivered.

As the DeVore and Walsh cases demonstrate, parody will rarely, if ever, serve as a viable defense in a copyright infringement action where the allegedly infringing work fixates on a political view rather than the underlying work itself. To stave off claims of copyright infringement, political satirists would thus do well to take aim at works with overtly political tones or otherwise limit their commentary to the works from which they borrow.  

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As previously reported, North Face sued South Butt for trademark infringement and dilution for using the name THE SOUTH BUTT and an arc designed to evoke the well-known logo for THE NORTH FACE. On the eve of a preliminary injunction hearing, the parties reported that they had settled their claims.

The Court thereafter entered two consent injunctions - one against the South Butt defendants (PDF), and another against a store that sold the allegedly infringing products (PDF). South Butt thereafter abandoned its federal trademark application for THE SOUTH BUTT (PDF), which will result in judgment being entered against South Butt in the trademark opposition proceeding before the Trademark Trial and Appeal Board because North Face did not consent to the abandonment.

So it is all over for South Butt, right? Not so fast. Although the terms of the settlement are confidential, there are a number of red flags suggesting that things may not be what they seem.

First and foremost, South Butt is still selling clothing bearing the accused mark THE SOUTH BUTT through its website. In the absence of North Face's permission, this would constitute a clear violation of the April 12 consent injunction against the South Butt defendants and subject them to contempt of court proceedings. Given the posture of the case, it is clear that North Face is allowing South Butt to continue selling accused products through its website in this manner.

What should we make of this? It is possible that North Face is allowing South Butt to continue to sell merchandise bearing the mark THE SOUTH BUTT under license from North Face, most likely for a royalty. Alternatively, North Face may be allowing South Butt to run out its inventory of accused products, either with or without a license.

The fact that the disclaimers of affiliation with North Face, such as they were, no longer appear on the website would normally point in the direction of a license. In this unusual case, however, it is possible that the disclaimers were removed because North Face found them offensive and did not wish to draw any attention to its association with South Butt. (According to the Answer (PDF), South Butt's website carried the following disclaimer: "We are not in any fashion related to nor do we want to be confused with The North Face Apparel Corp. or its products sold under "The North Face" brand. If you are unable to discern the difference between a face and a butt, we encourage you to buy North Face products.")

Second, the consent injunctions are subject to an important qualifier: "without the express written permission of The North Face." Thus, the injunctions themselves contemplate that North Face may give written permission for the defendants to use THE SOUTH BUTT as a trademark going forward, and it appears that this has occurred.

Third, the consent injunction against the store provides that the injunction will become permanent "unless a final non-appealable judgment is entered against The North Face" finding that South Butt has not engaged in any trademark violations, and further provides that the injunction shall "immediately dissolve without further order of the Court upon on a voluntary dismissal by Plaintiff of this action against the remaining Defendants." This language would appear to contemplate that the case might resolve unfavorably to North Face, despite the fact that the parties have already reported the case as settled.

How can this be? As in the case of the dog that did not bark, the court papers contain a significant omission -- judgment has not been entered, and North Face's claims against the South Butt defendants have not been dismissed. Therefore, despite the entry of the consent injunctions, the case remains open and the dispute has not been fully and finally adjudicated. It is possible that the parties are attempting to resolve their claims through means of alternative dispute resolution and have agreed to forgo litigation in the interim. It is also possible that certain settlement terms are subject to time periods which have not yet run, and that a consent judgment or dismissal will be filed at later time as dictated by the settlement terms.

While South Butt may have won this round, it appears to have made some significant concessions to North Face. More importantly, the last chapter of this trademark saga may not have been written. While there is no telling how this dispute will ultimately play out, particularly now that it is out of the public spotlight, fans of South Butt products should probably get them while they can -- just in case.

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In a lawsuit that has grabbed the attention of the trademark community, The North Face Apparel Corp. sued The South Butt, LLC, its founder (college student Jimmy Winkelmann), and a pharmacy that sold allegedly infringing goods for using the mark THE SOUTH BUTT on clothing that resembled the style of clothing sold under the well-known mark THE NORTH FACE. According to the Complaint (PDF), South Butt repeatedly attempted to register THE SOUTH BUTT as a trademark and offered to sell its business to North Face for $1 million. The Answer (PDF) describes Jimmy Winkelmann as a "cherubic teenager, budding entrepreneur and college freshman from the heartland of America" who "founded his company with parodic respect for Plaintiff." North Face moved for a preliminary injunction, and its motion was scheduled to be heard on April 12, 2010.

In a court filing (PDF) made on April 5, 2010, the pharmacy defendant advised the Court that all parties had reached a settlement of the case. While the terms of the settlement were not disclosed, it appears that SOUTH BUTT clothing continues to be sold on the South Butt website and is featured on the South Butt Facebook page.

Regardless of the settlement terms, the fact that the case was settled without a judicial decision as to the underlying parody issue represents a lost opportunity for trademark owners and parodists alike. In 2006, the Trademark Dilution Revision Act (TDRA) articulated for the first time the requirements for parody as "fair use" of a famous mark, explicitly stating that the use must be "other than as a designation of source for the person's own goods or services." 15 U.S.C. Section 1125(c)(3)(A).

Courts have not adopted a consistent approach to parody of famous marks under the TDRA. In one of the early parody cases construing the TDRA, the Fourth Circuit held that dog chew toys bearing the name CHEWY VUITON did not dilute the famous LOUIS VUITTON mark. Louis Vuitton Malletier S.A. v. Haute Diggity Dog, LLC, 507 F.3d 252 (4th Cir. 2007) (PDF). While the Court acknowledged that the defendant used CHEWY VUITON as a designation of source for its dog toys, and that the statutory fair use language therefore did not apply, it proceeded to find that the defendant was engaged in a successful parody because under the dilution factors it intended to create a parody and that is how the association would be perceived. Id. at 266-67.

This stands in contrast to the recent CHARBUCKS case, in which the Second Circuit found that the use of the CHARBUCKS mark on coffee could not escape liability for diluting the famous STARBUCKS mark based on a parody defense because CHARBUCKS was used as a source identifier and was too subtle to constitute a parody. Starbucks Corp. v. Wolfe’s Borough Coffee, Inc., 588 F.3d 97 (2d Cir. 2009) (PDF).

The North Face v. South Butt case presented an opportunity for the Eight Circuit to address the differing approaches to parody head-on. Assuming that the settlement is consummated, that opportunity will be lost, and the case law in this area will remain inconsistent. The owners of famous brands and their parodists will have to wait until another day for the courts to further articulate the requirements for parody under the TDRA.

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