Friday, February 17, 2012

Congratulations! Your ad isn't commercial speech

Jordan v. Jewel Food Stores, Inc., No. 1:10-cv-00340 (N.D. Ill. Feb. 15, 2012)
Michael Jordan was inducted into the Basketball Hall of Fame in 2009.  Sports Illustrated (whose publisher Time is a third-party defendant; interesting that Jordan didn’t try to bring it in) published a commemorative issue “devoted to celebrating his career.”  Time asked numerous businesses, including Jewel, to design a page for the issue “with some play on words or design that is specific to Michael Jordan.”  Jewel didn’t pay, but did agree to stock and sell the issue at special displays by the checkout counters of its grocery stores. 
Jewel’s ad features a pair of basketball shoes spotlighted on the hardwood floor of a
basketball court.  
23, the number Jordan wore for most of his tenure with the Chicago Bulls, appears on the tongue of each shoe, and the text reads: “A Shoe In!  After six NBA championships, scores of rewritten record books and numerous buzzer beaters, Michael Jordan’s elevation in the Basketball Hall of Fame was never in doubt!  Jewel-Osco salutes #23 on his many accomplishments as we honor a fellow Chicagoan who was ‘just around the corner’ for so many years.”
Underneath is Jewel’s logo and slogan, “Good things are just around the corner.” 
Jordan sued Jewel for state and federal trademark claims as well as violation of the Illinois right of publicity.  Jewel removed from state court and filed a third-party complaint against Time, seeking contribution and indemnification, at which point Time counterclaimed for breach of contract and indemnification.
The court ruled that the ad was noncommercial speech but declined to find that this was dispositive of all claims absent further briefing.
Procedurally, whether the speech was commercial was an issue of law, and the factors for the court to consider were also issues of law.  Jordan still argued that if relevant material facts were in dispute, the jury should be asked about them via special interrogatories.  The court disagreed.  The parties disputed not historical facts but legal consequences of those facts, and for SJ purposes it resolved all factual disputes in Jordan’s favor.
To determine whether speech is commercial, the 7th Circuit asks whether it proposes a commercial transaction.  The court didn’t see this ad as doing so, since it was just congratulating Jordan.  “At the most basic level, … readers would be at a loss to explain what they have been invited to buy.”  Jordan invoked brand theory, arguing that the use of its TM and slogan “effectively propose a commercial transaction by inviting the reader to visit Jewel stores.”  Further, Jordan contended, the statement that he “was ‘just around the corner’ for so many years” explicitly linked him to Jewel’s ad campaign and thereby invited readers to enter into a commercial transaction.
In this posture, the court accepted Jordan’s “factual description of the role played” by the slogan.  But the conclusion—that use of the logo and slogan, and reference to the slogan in the congratulatory text, proposed a commercial transaction—did not follow given the context. 
The court then proceeded to offer several reasons that this was a special case, many of which will doubtless be seized on by plaintiffs’ counsel.  Initially, this issue was no ordinary Sports Illustrated.  It was a “special commemorative issue expressly designed as a paean to Jordan, a fact confirmed by its title, ‘Jordan[:] Celebrating a Hall of Fame Career.’”  Jewel’s ad embraced the issue’s theme, “focusing not on Jewel or its particular products and services, but on Jordan.”
True, the ad used Jewel’s logo, but that was the most effective way to identify Jewel as the speaker; Jewel wasn’t required to use the harder-to-identify corporate name, which might have caused “a moment’s hesitation or confusion.”
Likewise, the use of the slogan “was simply a play on words, a cheeky way to ensure that the congratulatory message sounded like it was coming from Jewel and not any from other person or entity.”  The court hypothesized Arnold Schwarzenegger congratulating the LA Lakers for winning the championship.  If he said, “Congratulations to our Lakers for ‘terminating’ the Orlando Magic and bringing home yet another NBA title, and to Kobe Bryant for winning the Finals MVP.  Let me join all Angelenos in saying that Kobe and the team surely will ‘be back’ in the 2010!,” the references to Terminator would personalize the congratulatory message.  “Who other than Schwarzenegger would congratulate the Lakers and Bryant in precisely that way?  The ‘Terminator’ references thus are deployed to make the congratulatory message more effective, not to tie the Lakers and Bryant to the ‘Terminator’ franchise in an effort to encourage readers to buy Terminator DVDs and video games and thereby enhance Schwarzenegger’s royalty checks.”  (The theoretical and practical criticisms of “trademark use” are powerful, but judges sure do like to reinvent the idea when it suits them.)
Jewel’s use of its slogan also personalized the message and reinforced the idea that Jordan was Jewel’s “fellow Chicagoan” and therefore a source of pride for Jewel and all other Chicagoans. “It is highly unlikely that the slogan’s presence would lead a reasonable reader to conclude that Jewel was linking itself to Jordan in order to propose a commercial transaction.”  Anyway, even if the slogan introduced a minimal amount of commercialism, “that element is intertwined with and overwhelmed by the message’s noncommercial aspects, rendering the page noncommercial as a whole.”
The court contrasted the Abdul-Jabbar case, where the ad at issue linked Lew Alcindor’s performance with that of Oldsmobile’s car.  “GM touted Alcindor’s accomplishments as a means to propose commercial transactions—sales of a particular Oldsmobile model—not as a means to congratulate him on honors he earned a quarter century before the spot aired.  The opposite is true of Jewel’s page.”
Even setting the “proposes a commercial transaction” test aside, the three factors the Supreme Court has identified as relevant to defining commercial speech also favored Jewel.  The factors: whether (1) the speech is an advertisement; (2) the speech refers to a specific product or service; and (3) the speaker has an economic motivation for the speech.  No single factor is necessary or sufficient on its own.
Jewel’s ad wasn’t a conventional ad, as the court already concluded, even though it used Jewel’s logo and slogan.  Jewel and Time used the term “ad,” but that was “convenient shorthand; there is no equivalently precise and pithy term for the kind of page that Jewel and others placed.”  Indeed, family friends of Jordan placed a page that was also called an “ad” by relevant parties, but it was not a conventional ad either.
Furthermore, Jewel didn’t pay money to run the page; it only agreed to stock copies in its store.  (I’m guessing barter doesn’t take an ad out of the “commercial speech” category without more, though.)  Nor did the ad focus on or praise any product or service.  It was timed to praise Jordan, not to any Jewel promotion.
The court also drew attention to the fact that Dominick’s Finer Foods, a defendant in a separate case filed by Jordan, placed an ad in the same issue. “The fact that Jewel and Dominick’s, fierce competitors in the Chicago grocery market, both placed pages in the commemorative issue is significant because anybody inclined to be swayed by Jordan’s appearance in an advertisement knows that he does not play on two or more sides of the same fence, commercially speaking. Jordan is Hanes, not Jockey or Fruit of the Loom; Nike, not Adidas or Reebok; Chevrolet, not Ford or Chrysler; McDonald’s, not Burger King or Wendy’s. A reader who purchased the commemorative issue and saw the Jewel and Dominick’s pages would know, instinctively, that the Jewel page was not an advertisement.”  The court noted that the Dominick’s page shows a steak and offers a coupon; “if somebody were to view one of the pages as an advertisement, it would be the Dominick’s page….  The reader would see the Jewel page for precisely what it is—a tribute by an established Chicago business to Chicago’s most accomplished athlete.”  (Given what the court says later, I’m pretty sure that the court is trying to make this prediction nondispositive to its analysis.)
As to the second factor, whether the ad refers to a specific product, Jordan argued that Jewel’s slogan and logo effectively referred to all of Jewel’s products and services.  The court disagreed.  “The name and slogan of any business will evoke that business’s products or services in general—McDonald’s, fast food; IKEA, affordable furniture; Mercedes, luxury transportation; Apple, stylish technology.  But the Jewel page does not refer to a specific product or service, which is the relevant inquiry.”  Even without a reference to a specific product, an ad might be commercial: “If Jewel’s page pictured a fully set Thanksgiving table, but no food or other products sold at Jewel stores, the page still might have been commercial.  But there is nothing in Jewel’s page even remotely as evocative of its products and services” (citation omitted).
The court accepted that Jewel had an economic motivation for placing the page, to bolster its reputation as a good Chicago citizen.  “To say that a for-profit corporation like Jewel has an ‘economic motivation’ for taking any particular action is to state a truism.”  But the Supreme Court has clearly rejected the idea that it follows that all corporate speech is commercial.  There must be something more, and that more was missing here.
The court then “recognize[d] that this conclusion rests in part on judgments regarding how reasonable readers would view the page.”  But such judgments had to be made, and the precedent said they had to be made as a matter of law.  Because judges aren’t experts in consumer perception, it was possible that consumer surveys could show whether people actually consider particular speech to have proposed a commercial transaction.  For this, the court cited the Supreme Court’s consideration of survey evidence for the second prong of Central Hudson (whether there’s a substantial government interest in regulating the speech that’s already been determined to be commercial), which I don’t think is quite on point, but ok.  (Note, however, that the 9th Circuit has rejected surveying audiences about what counts as transformativeness for copyright fair use purposes, and that fair use serves a similar speech-protective role.  One reason not to ask consumers is that such a question might not be particularly meaningful to them: “does this page propose a commercial transaction?” is a weird thing to ask. At the very least we might need to train consumers with things that do and don’t propose commercial transactions first, as with genericity surveys.)
Anyway, it didn’t matter here because neither side submitted a survey.
The court held that it couldn’t yet decide the full implications of the noncommercial speech holding for Jordan’s claims.  Each side provided perfunctory arguments, so the court asked for further briefing.

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