Thursday, October 06, 2011

Elf defense: parody defeats TM and copyright claims

Elf on the Shelf book and dollElf off the Shelf book
CCA and B, LLC v. F W Media Inc., --- F.Supp.2d ----, 2011 WL 4583790 (N.D.Ga.)

Plaintiff sells The Elf on the Shelf, and defendant is about to sell The Elf off the Shelf, a self-described parody. Plaintiff sued for trademark infringement and dilution, copyright infringement, violation of ACPA, and coordinate state claims, but it sought a preliminary injunction only on the trademark and copyright infringement claims.

Elf On (yes, that’s the court’s shorthand) is “a popular children's Christmas book sold in a 10" by 10" by 2.5" box set with a plush toy elf doll 8.5 inches in height in a red costume.” It’s sold more than 1.5 million copies since 2005. Plaintiff registered copyrights in the elf doll and the sitting elf image on the cover. It also registered trademarks in the word mark "The Elf on the Shelf," the stylized logo used on the cover of its book, and the sitting elf image and operates to promote its book.

Elf On “explains how Santa keeps track of who's naughty and nice each year and what are their wishes: by employing millions of "scout" elves around the world to monitor children's behavior. These friendly elves are dispatched to individual families to watch the children's behavior and report nightly back to Santa. The story warns children that the elf will report every "push or a shove" or broken rule, but reassures that ‘small acts of kindness will not be a loss.’ The elf encourages children to tell him their every gift desire so he can report their lists to Santa.” The illustrations are “subdued watercolor paintings that resemble the world of a child's imagination more than that of reality.”

Plaintiff encourages parents to move the elf around the house each day “as evidence that the elf returns to the North Pole at night to tell Santa about their behavior,” and the book jacket said that the author discovered that this tradition helped children control themselves with “a gentle reminder that ‘the elf is watching.’”

Elf Off (yep) “tells a very different but related story. The elf narrator describes himself as a discount elf (sprung from a marked-down copy of Elf On) who is supposed to help Santa decide who's been naughty and nice. But the stories quickly diverge from this common ground. In Elf Off, the elf warns that he'll be ‘pissed’ if children give him a name he dislikes.… [Horace the Elf is] going to drink spiked eggnog, try to make his ‘move’ on Barbie while Ken's away at the Malibu dream house, watch pornography in the middle of the night, change the children's gift list so there's ‘something in it for me,’ and finally, run away to the tropics rather than return to the North Pole.”

The book jacket says that, prior to "being sent out to spy on and judge small children, [Horace] worked the assembly line in Santa's Workshop." Elf Off’s cover includes the book title in a font that is quite similar to plaintiff's stylized logo font, an image of an elf in a green costume dangling from a shelf, the subtitle "A Christmas Tradition Gone Bad," a byline attributing the story to Horace the Elf, and a final sentence, in red font: "A new holiday parody--for Mom and Dad!" The book is much thinner than plaintiff’s box set and doesn’t come with a doll or special packaging. The back cover “shows a photograph of the elf doll holding the Elf On book while surrounded by a remote control, Zombie Slayer DVD, and various gift cards” and also has a small-print disclaimer.

Elf Off is illustrated of photos of the Elf On doll in a green costume. “Photographs show the elf splayed on a table with spilled eggnog, snuggled in bed with Barbie, hanging out in the Christmas tree with a nutcracker, and lying behind a toilet after being tormented by the cat. The first page of the Elf Off story shows a small picture of Plaintiff's book, including the sitting elf image, partially obscured by ‘75% off’ and ‘super markdown’ stickers.” Defendant operates

Plaintiff argued that defendant’s book undermines Elf On’s “wholesome and healthy” brand image, citing an article in Publisher's Weekly that reported that Elf Off is intended to "knock a holiday favorite off its perch." Defendant agreed, but said that that was a perfectly acceptable parodic goal.

Plaintiff alleged that defendant’s photos of the elf doll infringed its copyright in the elf doll, and that defendant’s use of the dangling elf and photos of plaintiff’s book infringed its copyright in the sitting elf image. In addition, plaintiff alleged that its trademarks in the book title, domain name, stylized word mark, and sitting elf image were infringed by the corresponding uses by defendant.

The court first asked whether Elf Off was a parody. Because we can’t let a question like that be simple in IP, the inquiries are similar, but not identical, for trademark and copyright. For copyright we look for comment on or critique of the original, and for trademark we look for whether the use is “clearly in jest.”

Copyright: the parody is clear,
albeit not particularly pungent. The question is simply whether a parody may reasonably be perceived in the content. borrows Elf On's elf-spy idea to tell the story of a very naughty elf with little interest in monitoring children's behavior. Elf Off may not render a scathing critique of Plaintiff's book, but by reporting his own mischief throughout the story, Horace highlights the perceived absurdity of a “big brother” type of elf reporting on small children in Elf On. The odd realism in Elf Off (with images, including the unflattering photograph of the elf doll lying next to a toilet, suggestive of an under-employed adult living with his parents) contrasts with the wonderland world of Elf On in a way that makes the idea of using an Elf "scout" (or spy) to encourage good behavior in one's children seem somehow unsavory. Horace is not hilarious, but he does use his foul mouth to say something pointedly different than the elf in Plaintiff's work.
But there’s conceptual trouble in parodyland—plaintiff wasn’t arguing that defendant’s book infringed plaintiff’s book, rather that defendant’s book infringed the elf doll and sitting elf image. (Side note: I question whether the sitting elf and dangling elf images are substantially similar.) Puzzlingly, the court found this distinction “relevant” but still concluded that the use was “in the context of a parody” and, without further analysis, found that there was comment or criticism of “the copyrighted work.” It would have been better, I think, to reject plaintiff’s attempt to divide up its interests in this way; there’s always some element of the original that isn’t itself transformed or criticized in a parody, but the question should be whether there is transformation overall, and the court functionally reaches this result, just adding in some awkward somersaults along the way.

Because Elf Off was itself the product being sold rather than an ad, its commercial purpose weighed only somewhat against fair use. Plus, it was transformative; where plaintiffs want parents to create the impression that the doll has a magical life of its own, defendant “depicts the doll in rather unromantic settings that similarly demystify the magical idea of the elf doll in Elf On.” The use of the sitting elf image in a photo of what looks like plaintiff’s book, that use furthers the attack “by showing the book covered with clearance stickers and next to a Zombie Slayer DVD.” This use was also very small “and primarily provides a distinguishing reference to the original,” and could thus be considered inconsequential.

As for the dangling elf image, it didn’t do much to advance defendant’s story or convey commentary, so it wasn’t as transformative as the photos of the elf, but it was still in the context of a parody and therefore transformative. Overall, factor one pointed towards fair use.

Plaintiff’s work was creative, but this factor is neutral in parody cases. Likewise, parodies may need to take the heart of the original. The elf doll and the sitting elf image are the heart of Elf On—but plaintiff argued that it was claiming infringement of the doll and the sitting elf image, not the book. Thus, defendant copied the entirety of those works. But, the court reasoned, those images make up only a small proportion of Elf Off. In Mattel, Inc. v. Walking Mountain Prods., 353 F.3d 792 (9th Cir. 2003), the court pointed out that it’s hard to use only a portion of a doll, and that adding material assists the defendant in such a case by creating a context around the copied material. The amount and substantiality copied was therefore reasonable.
Effect on the market: plaintiff failed to explain its theory of market harm. Here the slice-and-dice approach backfired: “Nothing in the record indicates the elf doll or sitting elf image, independent from the book, have any market value whatsoever.” The court found it unlikely that defendant’s book of photos of the elf doll would replace sales of the doll or the sitting elf image. Instead, plaintiff argued that Elf Off would degrade the market value of Elf On. “The flaw in this argument is that Plaintiff has not alleged infringement of the story contained in Elf On.” And anyway, it was unlikely that consumers would choose this inappropriate-for-children parody in place of the wholesome Elf On. Defendant’s hope to knock a holiday favorite off its perch was legitimate harm done by parody, not illegitimate replacement. Plaintiff was conflating trademark and copyright.

Thus, there was no likely success on the merits of the copyright claim.

Trademark: a trademark parody has to be successful in communicating both the reference to the original and some kind of ridicule of it. The court found that the differences between the works would be most clear side-by-side, but consumers might not view the products that way. The font and design are nearly identical, so a consumer might not immediately identify the parody; the dangling elf was a “subtle” alteration of the sitting elf. The difference between off and on and the different color schemes were also minor. But the subtitles "a new holiday parody--for Mom and Dad," “clearly provide additional cues that distinguish the marks.”

Citing the old Fourth Circuit PETA case, plaintiff argued that the court should only look at the cover and the domain names at issue, but as that court clarified/retreated in Lamparello v. Falwell, 420 F.3d 309 (4th Cir. 2005), context is highly relevant. Though this was a close question for trademark purposes looking just at the covers, the boldface parody statement plus the disclaimers on the back and inside pages, and multiple other visual cues were enough to change the overall impact “to present enough visual information to flag for consumers that the book is a parody for adults.” Likewise, the Elf Off website “presents the book cover immediately on arrival at the site and thus similarly communicates that the book and website parody the original.”

In a footnote, the court suggested ways that defendant could have done a better job of conveying its parodic purpose, and cautioned that “the facts at this early stage of the case do suggest an arguable possibility of consumer confusion. Plaintiff potentially could present survey evidence proving consumer confusion at trial. In light of this, Defendant may wish to consider taking additional measures to distinguish the cover of Elf Off before marketing it.” This highlights the ways in which trademark can underprotect expressive uses: I have no doubt that plaintiffs could, for enough money, get a survey suggesting likely confusion. But I don’t think the game is worth the candle.

On to infringement: for purposes of this motion, the parties agreed that the marks were strong and that Elf Off used similar marks. In the Eleventh Circuit, parody is not itself a defense but influences the way the likely confusion factors are applied. The court treated the Elf Off book title and the Elf Off domain name the same because the website prominently displays the book cover.

Mark strength may reduce the likelihood of confusion in a parody case, because consumers are more likely to get the joke. Here, though the parties agreed that the marks were strong, the court was still uncertain about distinctiveness. “The use of an elf in a Christmas-theme gift set is not a unique idea. At best, Elf On is well known within a particular sub-set of the population.” Then, though, the court pointed out that the sub-set comprised both parties’ target audience. Assuming the mark is strong, this factor favored the defendant.

Similarity: did defendant borrow so much that its use became ineffective as parody and instead seemed to be affiliated with or sponsored by plaintiff? The court found that the sight and sound were extremely similar, but somewhat more risk of confusion should be tolerated in cases of parodic artistic expression. “Although at first glance consumers might not notice all the distinctions between the two products, the first glance is not decisive.” Momentary confusion can be tolerated when it would be readily dispelled by further consideration by an ordinarily prudent consumer. “Reasonable consumers faced with purchasing a children's book are likely to open the book to see what they are buying for their children.” Examination of defendant’s book would reveal the “parody” designation, and on any given page consumers would likely see that this wasn’t a children’s book. “They may see the bizarre rhymes about ‘that stupid toy train’ or Barbie being a prude. They may notice the photographs of an elf watching x-rated videos like ‘Elves Gone WILD.’ These multiple distinctions go far to dispel consumer confusion.… Consumers, particularly those buying books, are likely to notice significant literary distinctions.” So similarity of marks also favored defendant.

Similarity of products: they’re both books; the addition of the toy doll isn’t very significant. However, if differences in the marks indicate parody, then a use on an identical product can be noninfringing. “Because some amount of similarity is required to accomplish the parody, it is difficult to imagine how Defendant could have created its parody without a book, although this book need not have been identical in length and width dimensions or "first glance" presentation as Elf On. Defendant notably did not include an elf doll, which suggests this factor weighs only slightly in favor of Plaintiff.”

Sales channels/customers: Defendant planned to market its book using the same major retail outlets, including and Barnes & Noble. It targeted an adult audience, but both children and adults buy Elf On. “However, the Court finds that parents are usually the purchasers even when the target audience for a book is children, so the argument that child consumers will be confused is not persuasive.” The overlap in target market and sales channels favored plaintiff. Similarity in advertising methods was neutral at this stage—it was unclear whether defendant was trying to make its product or website show up in searches for Elf On. (Why would this increase confusion any more than negative reviews or other competing products showing up?)

Intent: Defendant’s criticism of plaintiff’s book plus its clear disclaimer weighed in its favor.

Actual confusion: There was no evidence of actual confusion, which is frequently key in parody cases. At this stage, though, the absence of evidence was just neutral.

Overall, while parodies may be confusing, that’s usually because they lack expressive elements or clear indications of parody. “Where some aspect of the work clearly communicates to consumers that it is a parody, or where the medium in which the marks are used is inherently expressive (such as artistic photographs), courts protect that expression.” Especially given the First Amendment concerns at issue, the factors weighed against finding likely confusion.

Without likely success, there wasn’t going to be a preliminary injunction. The court also pointed out that an injunction would destroy defendant’s plan to market Elf Off for the 2011 holiday season and take advantage “of a growing trend of made-for-adult parodies of children's books, a fad that may end before a trial on the merits is completed.” Plus, the public interest favors free speech.


  1. Do you think this woman charging for this Shelf Elf pattern would lose in court?

  2. Anonymous9:09 AM

    No, these elves have been around since the 60's. These people did not "invent" this elf.