Eric Goldman has suggested that fair use owes Righthaven a debt of gratitude, given how many pro-fair use decisions it’s managed to have put on the books. I’m not sure the same could be said for LV, but the fact that the court doesn’t see this as a tough case should, I hope, make some potential plaintiffs consider their exposure to attorneys’ fees awards.
LV sued WB for its use of an allegedly infringing travel bag in The Hangover: Part II, claiming false designation of origin, unfair competition, and state law trademark dilution. WB moved to dismiss, and the court granted the motion.
Like it or not, the film was “the highest-gross R-rated comedy of all time and one of the highest grossing movies in 2011.” Meanwhile, “Diophy is a company that creates products which use a monogram design that is a knock-off of the famous Toile Monogram.” In an early scene in the film the four main characters are waiting for a flight to Thailand. The complaint explains that a porter pushes a dolly with what appear to be LV trunks and bags, and that one of the characters, Alan, carries “what appears to be a matching over-the-shoulder Louis Vuitton ‘Keepall’ bag, but it is actually an infringing Diophy bag.” Moments later, the scene shifts to Alan sitting on a bench; he places the bag on the seat next to him. Another character moves the bag so that a third character can sit down, and Alan reacts by saying: “Careful that is . . . that is a Lewis Vuitton,” mispronouncing “Louis.” That’s it for LV and the Diophy bag in the film.
The complaint alleged that many consumers believed that the bag was a genuine LV and that LV consented to this misrepresentation. LV further alleged that the harm was worsened by the prominent use of these scenes in ads for the movie, and that the “Lewis Vuitton” line has “become an oft-repeated and hallmark quote from the movie.”
LV attached “[r]epresentative Internet references and blog excerpts” allegedly showing consumer confusion about genuineness. The court dropped a footnote that, though it was taking the complaint’s allegations as true, “none of the Internet references and blog excerpts attached to the complaint … show that anyone is confused or mistaken into believing that the Diophy bag was a real Louis Vuitton bag. In one blog post, a commenter notes that the luggage on the cart is real, but the bag carried by Alan is a ‘replica.’ Although a few other posts and comments refer to the bags generally as Louis Vuitton bags, no one else specifically writes about Alan’s bag, let alone its authenticity.”
The court began its analysis by noting that LV was not objecting to unauthorized use of the LV marks or reference to the LV name, nor did it claim that WB misled the public into thinking that LV sponsored or was affiliated with the film. Rather, LV argued that WB impermissibly used an infringing third-party bag, confusing the public into thinking it was an authentic LV product and that LV sponsored and approved this use and misrepresentation. This further allegedly caused blurring and tarnishment because of the poor quality and shoddy reputation of the Diophy bag.
WB moved to dismiss under Rogers v. Grimaldi. In the alternative, it argued that “basic principles of trademark law” such as the requirement of confusion related to consumer purchasing decisions barred the claim, but the court didn’t reach those arguments because the First Amendment protected the film.
Rogers protects artistic works from the Lanham Act as long as a defendant’s use is artistically relevant and not explicitly misleading. Rogers is about titles, but courts use it for the content of expressive works as well. LV conceded that WB’s use of the mark was noncommercial, making it an “artistic work” for Rogers purposes.
LV argued that artistic relevance was an issue of fact; that “explicitly misleading” can be more than confusion about source or content of the defendant’s work; and that there’s no First Amendment protection for using an infringing product.
The threshold for artistic relevance is “purposely low.” “The artistic relevance prong ensures that the defendant intended an artistic—i.e., noncommercial—association with the plaintiff’s mark, as opposed to one in which the defendant intends to associate with the mark to exploit the mark’s popularity and good will.” (Ah, the slippery language of intent; what a bad idea. Of course it mattered that the film used a famous mark instead of a high-fashion but unknown mark; mispronouncing the famous mark allowed the filmmakers to convey Alan’s unsuccessful snobbery, thus drawing on the mark’s popularity and goodwill. The work here is really being done by an idea of “exploitation” that excludes “making meaning,” which is of course correct but would benefit from clearer statement.)
WB’s use of the Diophy bag met the low threshold:
Alan’s terse remark to Teddy to “[be] [c]areful” because his bag “is a Lewis Vuitton” comes across as snobbish only because the public signifies Louis Vuitton—to which the Diophy bag looks confusingly similar—with luxury and a high society lifestyle. His remark also comes across as funny because he mispronounces the French “Louis” like the English “Lewis,” and ironic because he cannot correctly pronounce the brand name of one of his expensive possessions, adding to the image of Alan as a socially inept and comically misinformed character.
LV argued that discovery was required to determine artistic relevance. If WB intended to use an authentic LV bag, it argued, using the Diophy bag wouldn’t be artistically relevant. “However, the significance of the airport scene relies on Alan’s bag—authentic or not— looking like a Louis Vuitton bag. Louis Vuitton does not dispute this was Warner Bros.’ intention, and therefore the discovery it seeks is irrelevant. The Court is satisfied that Warner Bros.’ use of the Diophy bag (whether intentional or inadvertent) was intended to create an artistic association with Louis Vuitton, and there is no indication that its use was commercially motivated.” The cases cited by LV involved the court’s disbelief of a defendant’s claim of communicative intent or expressed concern that the use of the mark was “commercially motivated,” and were thus distinguishable (citing the Dairy Queens case, the unsuccessful case against Spiderman for digitally altering billboards in Times Square, and Parks v. LaFace). LV also argued that artistic relevance couldn’t be determined on a motion to dismiss, but the court disagreed.
So, use of the Diophy bag would be unprotected only if it explicitly misled as to the source or content of the work. The question is whether the mark is misleading in the sense that it induces the public to believe that the work was prepared or otherwise authorized by the plaintiff. This involves using the Polaroid factors, but only a particularly compelling finding of likely confusion can overcome the speaker’s First Amendment interests. The case law has “consistently framed the applicable standard in terms of confusion as to the defendant’s artistic work.” This is no coincidence: “This narrow construction of the Lanham Act accommodates the public’s interest in free expression by restricting its application to those situations that present the greatest risk of consumer confusion: namely, when trademarks are used to ‘dupe consumers into buying a product they mistakenly believe is sponsored by the trademark owner.’” When a trademark isn’t used in any direct way to designate the source or sponsorship of the defendant’s work, the consumer interest in avoiding deception is too slight to trigger the Lanham Act.
LV argued that “explicitly misleading” also extended to confusion about the source or content of a third party’s goods. It relied on Dallas Cowboys, “a decision whose First Amendment approach Rogers expressly declined to follow and which has been criticized by other courts.” Even if the case did apply to noncommercial speech, it wouldn’t help LV. Though the Second Circuit in Dallas Cowboys said that the Lanham Act covers confusion that “the mark’s owner sponsored or otherwise approved the use of the trademark,” that “otherwise approved the use” language, in context, means confusion that the mark’s owner sponsored or approved of the film. The court specifically spoke of the plaintiff’s plans to prove at trial that the public was confused “into believing that plaintiff sponsored the movie, provided some of the actors, licensed defendants to use the uniform, or was in some other way connected with the production.”
The complaint alleged two theories of confusion: “(1) that consumers will be confused into believing that the Diophy bag is really a genuine Louis Vuitton bag; and (2) that Louis Vuitton approved the use of the Diophy bag in the Film.” But even drawing all reasonable inferences in LV’s favor, neither of those allegations involved confusion as to WB’s artistic work. “Louis Vuitton does not allege that Warner Bros. used the Diophy bag in order to mislead consumers into believing that Louis Vuitton produced or endorsed the Film. Therefore, the complaint fails to even allege the type of confusion that could potentially overcome the Rogers protection.” (Or, as I think Jeremy Sheff pointed out, that could be actionable. Approving a use versus approving the film is perhaps a fine distinction, but at least it starts to edge toward the real issue of materiality: why would anyone’s purchasing decisions be affected by confusion over whether LV allowed a use?)
Even assuming that LV stated a cognizable claim of confusion, it would still fail. When First Amendment values are involved, the Lanham Act must be narrowly construed. Here, the allegations weren’t plausible, let alone “particularly compelling” as required. First, it was highly unlikely that anyone watching would even notice that the bag was a knock-off. LV was trying to have it both ways: arguing that the Diophy bags created consumer confusion but at the same time were so obviously dissimilar that viewers would notice the slightly different symbols on the bag. “Yet, the Diophy bag appears on screen for no more than a few seconds at a time and for less than thirty seconds in total, and when it is on screen, it is usually in the background, out of focus, or partially obscured by other things.” The difference in appearance was so difficult to even notice that a confusion claim was simply implausible. “Furthermore, Louis Vuitton’s position assumes that viewers of the Film would take seriously enough Alan’s statements about designer handbags (even about those he does not correctly pronounce) that they would attribute his views to the company that produced the Film. This assumption is hardly conceivable, and it does not cross the line into the realm of plausibility.”
Finally, LV characterized “a statement made by a fictional character in a fictional movie” as an affirmative misrepresentation. “However, this assumes that the fictional Alan character knew that his bag was a knock-off; otherwise, he would simply be (innocently) misinformed about the origin of his bag.” (I don’t see why this matters. The Lanham Act doesn’t require intent. It would make more sense to say, as the court suggested in a footnote, that a statement made by a fictional character in a fictional movie may not constitute a representation about origin, and thus can’t constitute a misrepresentation.)
Anyway, the likelihood of confusion was “at best minimal,” and certainly not particularly compelling. The public interest in avoiding consumer confusion wasn’t enough to overcome the “significant threats to free expression” from imposing liability for noncommercial speech in this case. “This is especially true since the relevant confusion is caused by a third-party—one with whom Warner Bros. has no relationship whatsoever.” The court pointed out that contributory infringement requires that the defendant have a connection to the sale of confusingly similar goods. LV didn’t allege that WB was a contributory infringer.
Now, a footnote I like a lot: “This limit on the Lanham Act “is consistent with the text of § 43(a)(1)(A), which expressly requires the ‘confusion,’ ‘mistake,’ or ‘dece[ption]’ to be ‘of [the defendant’s] goods, services, or commercial activities,’ and with the core concern of trademark law, which is confusion related to purchasing decisions and not confusion generally.” We even get a Dastar quote: “The words of the Lanham Act should not be stretched to cover matters that are typically of no consequence to purchasers.” Thus, the Act generally applies to sellers who seek to pass of their goods as the goods of another, “and not to a defendant who has no connection to the sale of the confusingly similar goods—especially one engaged in expressive speech.”
LV argued that Rogers couldn’t be applied on a motion to dismiss. The court disagreed:
In the context of a motion to dismiss, courts have disposed of trademark claims where simply looking at the work itself, and the context in which it appears, demonstrates how implausible it is that a viewer will be confused into believing that the plaintiff endorsed the defendant’s work (and without relying on the likelihood of confusion factors to do so)…. In a case such as this one, no amount of discovery will tilt the scales in favor of the mark holder at the expense of the public’s right to free expression.
Even if LV did allege confusion about the film, the Polaroid factors tilted against it:
The marks and products are entirely dissimilar; Louis Vuitton and Warner Bros. are in different industries and not in competition with each other; there is little chance that Louis Vuitton will “bridge the gap” to movie production; there is no claim that Warner Bros. knowingly used a knock-off when filming the movie; and moviegoers are sophisticated enough to know that the mere presence of a brand name in a film, especially one that is briefly and intermittently shown, does not indicate that the brand sponsored the movie, and consumers of handbags are sophisticated enough to know the difference between a real bag and a knock-off. Even assuming that factor (5), actual confusion, favors Louis Vuitton, Rogers teaches that mark owner’s must accept “some” confusion when outweighed by free speech interests.
Also, LV’s argument that there was no First Amendment protection for using an infringing product was “without merit.”
Of course, the state law claims necessarily failed too.