Parody Products & Licensing - The Concerning Trend

Dog toys are leading the pack in finding ridiculous ways to subvert IP laws and a recent ruling by SCOTUS escalated the issue for brands to a '4 alarm' level. The lawsuit began when a small-scale company, VIP Products LLC, created a series of dog toys that were designed to resemble Jack Daniel's iconic whiskey bottles. Jack Daniel's parent company, Brown-Forman Corporation, filed a lawsuit against VIP Products for trademark infringement, claiming that the toys were confusingly similar to their trademarked bottle design. Unfortunately, Brown-Forman lost the case with SCOTUS voting in favor of VIP Toys.

Now if you peruse the internet for dog toys its hard not to come across various satirical representations of famous brands including "Starbarks" (... Starbucks), "White Paw" (...White Claw), and so on and so forth. How have brands allowed this to go on unchecked for so long? Well we have a running theory that boils down to the basic everyday business question of resource vs reward. What every legal team has to consider is will the cost and energy of the lawsuit be offset by the reward? The answer for a small line of product, especially in the dog toy category, is usually no.

Brown-Forman Corporation's legal action is understandable in the context of protecting their brand, and the case raises a troubling issue regarding the extent to which brand's can protect satirical representations on product. While trademark law provides for a fair use exception to infringement, allowing for the use of a trademarked design for the purpose of parody or commentary is riddled with a lack of clarity with a fine line between what constitutes parody and what is simply copying.

It's our opinion that if consumers are laughing about the similarities of a product to a beloved brand, then the product sales are certainly deriving value from the efforts of the brand in question which entitles them to a license fee. However, the law doesn't seem to agree with us. So what can brands do? And this is where we get controversial. If you ask any brand, the common guideline in any brand book is to keep the logo as in-tact, and pure to form as possible. No variations outside of brand guidelines, and certainly no parody elements. However, this rigidity in logo licensing also prevents clients from laying claim to variations of the logo that can potentially be argued as fair use. It would be our recommendation for major brands to strategic ways in which to 'own the joke' in certain categories, by creating satirical logo modifications and then to allow the licensing across relevant categories. In addition, utilizing a stronger key word search trademark protection strategy would certainly deter companies from seeing the business opportunity of the infringement in the first place. After all, if companies can't count on the leverage of the brand's key word search for consumer discovery, then what is the real value of the brand? All in all, brands will have to get a little more creative to protecting their IP not just for the sake of their licensing value, but also to retain control over the brand image in the marketplace.

What do you think? Drop us a line at hello@licensinghaus.com with your thoughts.