VIP Products LLC (“VIP”) designs, markets and sells “Silly Squeakers” dog toys that are often made to humorously resemble well-known beverage containers. In 2013, VIP fashioned the Bad Spaniels Silly Squeaker (“Bad Spaniels”) dog toy to resemble a Jack Daniel’s whiskey bottle and altered the label by: 1) replacing “Jack Daniel’s” with “Bad Spaniels;” 2) changing “Old No. 7” to “Old No. 2;” and 3) altering alcohol content descriptions to read “42% POO BY VOL.” and “100% SMELLY.” In 2014, Jack Daniel’s Properties, Inc. (“Jack Daniel’s”) directed that VIP cease and desist all sales of the Bad Spaniels toy on the basis that such sales violated its trademark law rights. VIP responded by bringing an action in Arizona District Court, seeking a declaratory judgement that the Bad Spaniels toy does not infringe upon, or dilute, any of Jack Daniel’s trademark rights. The Arizona District Court ruled in favor of Jack Daniel’s, finding that: 1) “Jack Daniel’s trade dress and bottle design were distinctive, non-generic, and nonfunctional, and therefore entitled to trademark protection;” 2) VIP diluted and infringed upon Jack Daniel’s trademarks and trade dress; and 3) VIP was not entitled to defenses of nominative and First Amendment fair use. On appeal, the Ninth Circuit affirmed the District Court’s ruling with respect to trade dress, reversed the District Court’s opinion on trademark dilution, and vacated the District Court’s findings on trademark infringement, ruling that “the Bad Spaniels toy was an expressive work entitled to First Amendment protection.”
What does the 9th circuit’s decision mean for trademark owners?