Friday, August 11, 2006

Two MORE recent TM decisions in the 9th Circuit

The Ninth Circuit has always seemed to have more than its fair share of interesting trademark cases. Here are two more noteworthy recent decisions.

Aesthetic Functionality of Audi and VW logos on car accessories -- A few weeks ago, I noted a decision of the 6th Circuit concerning the use of a car manufacturer's logo on replacement grilles made by an unlicensed company, wondering why the issue of aesthetic functionality never came up. Well, in Au-Tomotive Gold, Inc. v. Volkswagen of America, Inc., No. 04-16174 (9th Cir. Aug. 11, 2006), the issue was squarely raised and addressed. The case involved key chains, license plates, and license plate frames bearing exact replicas of the VW circle logo and the Audi four-ring logo. The district court had granted summary judgment to the unauthorized manufacturer of these items, holding that its use of the logos was aesthetically functional as a matter of law because the logos themselves were what drove the sales of the items: people liked the logos.

Natch, Audi and VW appealed. The 9th Circuit reversed. In a well-reasoned opinion, the Court discussed the history of the elusive concept of aesthetic functionality, from the 1938 Restatement of Torts through the Supreme Court's recent TrafFix decision. Ultimately, the 9th Circuit held that where the "entire significance" of the allegedly aesthetically-functional feature is its value as an identifier of source, then use of the mark is "naked appropriation" rather than appropriate. The Court -- correctly, in my view -- pointed out that to hold otherwise "would be the death knell for trademark protection."

Adoption (in dictum) of the "Sublicensing Rule" in TM cases -- In a case involving the tortuous twists and turns in the saga of the GLENN MILLER mark for music and related stuff, the 9th Circuit in Miller v. Glenn Miller Productions, Inc., No. 04-55874 (9th Cir. July 19, 2006), rejected a licensee's argument that it should be able to sub-license without express permission from the licensor in the absence of a prohibition against it. It adopted the rule that licensees can't sublicense without express permission (which was born in patent and copyright cases) because if the rule were otherwise it would make it hard for a licensor to exercise its duty to supervise and control use of its mark, thus undermining markholders' rights. Makes sense to me.

The problem, however, was that the 9th Circuit also rejected the licensors' claims based on laches, thus making the entire discussion about how the licensors were wronged dicta. That darn activist 9th Circuit! Next thing, they'll be ruling that the Pledge of Allegiance can by copyrighted by atheists. God . . . , er, . . . Someone help us.

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