U.S. Supreme Court Finds USPTO’s Bar on Offensive Trademarks Unconstitutional

On June 24, the U.S. Supreme Court ruled by a 6-3 vote that a federal law banning the registration of “immoral or scandalous” trademarks violates the First Amendment. In Iancu v. Brunetti, the court found in favor of Eric Brunetti, a Los Angeles streetwear designer who attempted to register the name of his 30-year-old brand, FUCT. The court ruled that the ban “disfavors certain ideas” and that the government may not discriminate based on speakers’ viewpoints. For the majority, Justice Elena Kagan wrote: “The statute, on its face, distinguishes between two opposed sets of ideas: those aligned with conventional moral standards and those hostile to them; those inducing societal nods of approval and those provoking offense and condemnation.” In the dissent, Chief Justice John Roberts and Associate Justices Stephen Breyer and Sonia Sotomayor agreed that the ban on “immoral” trademarks is too broad, but that banning “scandalous” trademarks does not violate the First Amendment. The court made this ruling in Brunetti two years after its unanimous decision in favor of Asian-American dance band, The Slants, finding that the Lanham Act’s prohibition against the registration of “disparaging” trademarks also violated the First Amendment.

Florida Federal Court Finds Former Commodores Guitarist In Violation of TM Court Order

On July 15, U.S. District Judge Roy B. Dalton Jr. denied ex-Commodores band member Thomas McClary’s motion to modify the scope of the court’s ban on his use of the band’s trademark “The Commodores” because his request was untimely and, without the court’s knowledge, McClary obtained exclusive licenses in violation of the court’s worldwide injunction against using the mark. In 2014, the band brought a trademark infringement action against McClary who was performing under the name “The Commodores featuring Thomas McClary” and “The 2014 Commodores.” After obtaining a preliminary injunction in 2014, the band obtained a permanent injunction in 2016, which restrained and enjoined McClary from using the marks in a manner other than fair use. The Eleventh Circuit affirmed this permanent injunction in 2018. In addition, in January 2019, a jury returned a verdict that awarded the band damages from McClary’s profits for many of his live musical performances in the U.S. and Europe that occurred after the 2014 preliminary injunction.

In his 2019 motion, McClary requested that the permanent injunction entered by the court be limited so he could use the band’s trademark for performances in Mexico, New Zealand, and Switzerland, where he obtained exclusive licenses. Judge Dalton denied the motion, ruling that it was not brought “within a reasonable time” and that carve out would violate the band’s permanent injunction: “The worldwide permanent injunction was implemented to prevent harm to plaintiff in the United States based on defendants’ use of the marks here and abroad — harm from customer confusion, dilution of the marks, and otherwise…That purpose would be undermined if the permanent injunction masqueraded as an invitation for defendants to obtain licenses to the marks at issue in foreign countries and to then perform under ‘The Commodores’ or other infringing names around the world.”

Ice Cream Seller’s “Scoop” Trademark Bid Rejected

On July 9, 2019, Yarnell Ice Cream LLC (“Yarnell”), an Arkansas ice cream retailer, lost its bid to register the name of its mascot, “Scoop”, as a trademark, after the Trademark Trial and Appeal Board (“TTAB”) determined that the proposed mark is merely descriptive of a unit of measurement commonly associated with ice cream and had not acquired distinctiveness as an indicator of Yarnell’s goods.

Yarnell argued that the word “scoop” should not be deemed descriptive given its multiple meanings (such as in the instance of a “news scoop”). In any event, Yarnell argued that it did not seek to register the mark “scoop” for ice cream, but rather, frozen treats “as promoted or distributed by a mascot named SCOOP”, and that the word scoop was not descriptive for a mascot distributing ice cream. The TTAB rejected this argument, finding that, while the word scoop may have multiple meanings, second meanings must be apparent from the context in which the mark is used. The TTAB also pointed to several instances where ice cream sellers had disclaimed exclusive use of the word scoop in connection with ice cream retail services, noting that Yarnell’s use of the scoop mark would cover ice cream. Finally, the TTAB pointed to Yarnell’s inconsistent use of the word “scoop” when referencing its mascot as evidence that the term did not function as a trademark, including instances where the proposed mark was “visually subordinate” to the word Yarnell on the mascot’s nametag. Interestingly, the TTAB rejected Yarnell’s argument that it was entitled to a presumption that the mark SCOOP had become distinctive for its mascot due to exclusive use of the term for over five years, noting that, when considering a descriptive mark, it was not required to consider exclusive use in finding such a presumption.

The case is Yarnell Ice Cream LLC, TTAB, Serial No. 86824279, 7/9/19

Aykroyd’s Vodka Company Sues Again Over Head-Shaped Bottle

On July 9, 2019, Dan Aykroyd’s vodka company, Globefill Inc., sued Mexican tequila maker Matatena Spirits S.A. de C.V. and its U.S. distributor Stoller Imports Inc. in an Illinois district court, accusing the pair of trade dress infringement for copying the clear, head-shaped design of Globefill’s Crystal Head Vodka, which Globefill has been using since 2008. Globefill clams it is the first company “throughout the history of the alcoholic beverage industry” to use the unique head-shaped design, and that the lawsuit is necessary to protect its rights in the bottle-shaped design and maintain “the alcoholic beverage market in the state it was [in] when Globefill took the risk to enter it with its unique (and expensive to produce) product packaging.” Matatena actually obtained a U.S. registration in its head shaped design; however, a U.S. Patent and Trademark Office attorney who examined the application cited a likelihood of confusion with Aykroyd’s bottle design.

Globefill’s lawsuit against Matatena is not its first suit in defense of its head shaped bottle design. In 2010, the company sued rival company Elements Spirts Inc., alleging that the design of Elements’ KAH tequila infringed the design of its bottle. In September 2017, a California federal judge granted a U.S. sales ban on KAH tequila and approximately $870,000 in disgorged profits, despite Globefill’s request$13 million.

The case is Globefill Incorporated v. Stoller Imports Inc. et al., case number 1:19-cv-04593, in the U.S. District Court for the Northern District of Illinois.

Cert granted to Lucky Brand Dungarees Inc. v. Marcel Fashions Group Inc.

On June 28, 2019, the Supreme Court granted a petition for certiorari filed by Lucky Brand Dungarees in Lucky Brand Dungarees, Inc., et al., v. Marcel Fashions Group, Inc. The Supreme court, in granting certiorari from the Second Circuit’s decision (898 F.3d 232 (2nd Cir. 2018)), will now need to decide whether the doctrine of defense preclusion barred Lucky from defending itself against Marcel’s trademark and unfair competition claims on the basis that Marcel had released its claims via a prior negotiated settlement.

The Supreme Court will review the case in the fall. The case is Lucky Brand Dungarees Inc. v. Marcel Fashions Group In., case number 18-1086, in the U.S. Supreme Court. Click here for a copy of the Court Opinion.

Dunnington Bartholow & Miller Trademark Bulletin Committee: Olivera Medenica, Donna Frosco (Partners); Sixtine Bousquet, Betsy Dale, Kamanta Kettle (Associates); Carolina Pineda (Special Counsel) & Valerie Oyakhilome (Paralegal).