How Whiskey and Chew Toys Dragged the Supreme Court Into a First Amendment Fracas

The Supreme Court joined millions of Americans last week in taking up whiskey right before the Thanksgiving holiday weekend. The justices said last week that they would hear Jack Daniel’s Properties, Inc. v. VIP Products LLC, a curious mix of alcohol, dog toys, trademark infringement, parody, and the First Amendment. It’s a case with an undeniably amusing factual basis, but it has the potential to turn this term into a potentially major one for intellectual property, free speech, and the lines that separate them.

At issue is one of VIP Products’s lines of dog toys that spoofs popular liquor brands. The Jack Daniel’s version strongly resembles the company’s iconic black-and-white label and bottle design. The mocking name on the mocked-up facsimile of the bottle reads “Bad Spaniels” instead of “Jack Daniel’s” and, in a subsection, “On Your Tennessee Carpet” instead of “Tennessee Sour Mash Whiskey.” To drive the joke home, the satirical label says “Old No. 2” instead of the “Old No. 7” that usually graces Jack Daniel’s bottles. The distillery’s brief described this as “poop humor,” which may be the first time that phrase has been used in a Supreme Court filing.

To Jack Daniel’s, however, this is no laughing matter. The distillery sued VIP Products for trademark infringement in 2014 after the dog toy company refused to cease marketing its product. Jack Daniel’s alleged that the company had violated the Lanham Act—the flagship federal trademark law—by using its trademark without permission, and by inappropriately tarnishing and diminishing its own brand identity with scatologically-themed dog toys.

“Consumers have associated Jack Daniel’s brand with JACK DANIEL’S®, OLD NO. 7®, and the distinctive square shape of its whiskey bottle for more than a century,” the company wrote in its petition for review. “The decision below—which departs from the decisions of every other circuit to decide this question—guts Jack Daniel’s ability to protect its brand and paves the way for companies like [VIP Products] to unleash mass confusion in the marketplace.”

A federal district court in Arizona sided with the distillery, finding that Jack Daniel’s had sufficiently proved that the dog toys would infringe its trademark and harm its brand. It also ordered VIP Products to cease selling the toys. VIP Products then appealed that ruling to the Ninth Circuit Court of Appeals, which sided with the dog toy company. The Ninth Circuit panel concluded that the lower court hadn’t properly weighed the First Amendment implications of its decision.

Like high school or a doctor’s office, this case revolves around tests. Jack Daniel’s claimed that the Ninth Circuit inappropriately went beyond the Lanham Act’s “likelihood of confusion” test, which it says sufficiently balances the First Amendment concerns, to reverse the lower court’s ruling. VIP Products, by comparison, told the justices that every federal appellate court that had considered the issue also applied what’s known as the “Rogers test” for cases involving artistic or “expressive” works. Using that test, the Ninth Circuit ruled that Jack Daniel’s must instead show that the dog toys’ satirical use of its trademark is intentionally misleading or artistically unnecessary to qualify as infringement—a far higher hurdle for the distillery to clear.

To that end, VIP Products described the Ninth Circuit’s ruling as fairly obvious. “It is ironic that America’s leading distiller of whiskey both lacks a sense of humor and does not recognize when it—and everyone else—has had enough,” the company wrote in its own brief urging the justices not to take up the case. It claimed Jack Daniel’s had “waged war” against it “for having the temerity to produce a pun-filled parody of [Jack Daniel’s] iconic bottle.” For consumers, VIP argued that the risk of brand confusion was minimal at best. “VIP has never sold whiskey or other comestibles, nor has it used ‘Jack Daniel’s’ in any way (humorously or not),” it noted. “It merely mimicked enough of the iconic bottle that people would get the joke.”

Jack Daniel’s, on the other hand, derided the Ninth Circuit’s ruling as a “get-out-of-the-Lanham-Act-free card” for would-be infringers. “To be sure, everyone likes a good joke,” the distillery claimed. “But VIP’s profit-motivated ‘joke’ confuses consumers by taking advantage of Jack Daniel’s hard-earned goodwill. The likelihood of confusion test already reconciles the competing First Amendment interests of mark holders and infringers; the Ninth Circuit’s test unjustifiably protects even intentionally misleading trademark use and elevates the infringer’s supposed free-speech interest above the mark holder’s.”

This is not the Supreme Court’s only case this term that will require it to decide where intellectual property law ends and the First Amendment begins. The justices are already considering Andy Warhol Foundation for the Visual Arts v. Goldsmith, which involves a Warhol silk-screen painting that he created using a Lynn Goldsmith portrait of the pop musician Prince. The foundation told the justices during oral arguments in October that the painting is an expressive work of art governed by the First Amendment and by statutory fair use protections; Goldsmith argued that it was uncompensated theft of her own creative work for private gain.

I somewhat jokingly wrote earlier this year that the Warhol case would require the justices to decide the age-old question, “What is art?” The Jack Daniel’s case and another one that awaits its potential consideration could require it to decide, “What is humor?” That third case, Novak v. City of Parma, Ohio, sprang from slightly more serious factual circumstances. Its namesake, Anthony Novak, created a parody Facebook page of his local police department and published six posts mocking it. The department responded by arresting Novak, searching and seizing his property, and prosecuting him for “disrupting” police functions. An Ohio jury acquitted him at trial and Novak sued the police department for violating his constitutional rights.

The Novak case could give the justices an opportunity to revisit the widely criticized doctrine of qualified immunity, which a lower court had granted to the police department after Novak’s lawsuit. But it could also allow the justices to reassert that parody is a core protected speech under the First Amendment. The case drew broader attention last month when The Onion filed an extraordinary friend-of-the-court brief that parodied Supreme Court briefs while calling attention to the free speech concerns at issue in the case—and the deeply unfunny reality of a local police department jailing and prosecuting an American citizen for mocking it on Facebook.

Jack Daniel’s doesn’t want VIP Products to be arrested for mocking and allegedly infringing upon its trademark, of course. The distillery would apparently settle for a court order to block it from selling any more excretion-themed chew toys. It is also not the only company to take an interest in this case. Friend-of-the-court briefs were also filed by companies ranging from jeans giant Levi Strauss to soup giant Campbell’s that urged the justices to review the Ninth Circuit’s ruling. They warned that it could lead to consumer protection chaos and violate the trademark owners’ own free speech rights. Without the court’s intervention, the companies all but said that federal trademark law will go to the dogs.