Forbes: Louis Vuitton v. My Other Bag: No License Required

January 6, 2017

By Oliver Herzfeld

Using another’s trademark on your goods and services usually requires a license. However, there are exceptions to that general rule. For example, under certain circumstances, you are not required to obtain a license in connection with trademark uses for purposes of parody. The recent decision in the case of Louis Vuitton v. My Other Bag provides a good example of this legal principle.

The Case

My Other Bag sells everyday canvas tote bags with drawings of various luxury brand handbags on one side and “My other bag” in large print on the other side. Louis Vuitton took offense at My Other Bag’s products that imitate a number of Louis Vuitton bag styles and commenced a lawsuit claiming, among other things, trademark infringement and dilution. The district court granted My Other Bag summary judgment on all of Louis Vuitton’s claims, holding that My Other Bag’s products are parodies and, as such, are not actionable sources of trademark infringement or dilution. In response, Louis Vuitton appealed the decision to the Second Circuit Court of Appeals.

The Legal Decision

On appeal, the Second Circuit affirmed the trademark infringement part of the summary judgment award finding no real likelihood of confusion as to the source or origin of My Other Bag’s products. In arriving at its decision, the Second Circuit pointed to:

1. the obvious differences in My Other Bag’s mimicking of Louis Vuitton's trademark with a caricature drawing and replacing Louis Vuitton's famous interlocking “L” and “Vs” with interlocking “M,” “O” and “Bs”;
2. the lack of market proximity between Louis Vuitton's high-end luxury handbags with a bourgeois target market and My Other Bag’s ordinary canvas tote bags with a proletariat target market; and
3. the failure of Louis Vuitton to produce convincing evidence of consumer confusion between the two bags’ manufacturers.

With respect to Louis Vuitton’s claims of trademark dilution (i.e., a legal concept that prohibits unauthorized uses of famous marks to prevent associations that reduce their distinctiveness and uniqueness), the Second Circuit held that My Other Bag’s tote bags are parodic, bringing them within a “fair use” exclusion from liability for trademark dilution. In particular, the Second Circuit explained “[a] parody must convey two simultaneous—and contradictory—messages: that it is the original, but also that it is not the original and is instead a parody. . . MOB's bags do precisely that. At the same time that they mimic LV's designs and handbags in a way that is recognizable, they do so as a drawing on a product that is such a conscious departure from LV's image of luxury—in combination with the slogan ‘My other bag’—as to convey that MOB's tote bags are not LV handbags. The fact that the joke on LV's luxury image is gentle, and possibly even complimentary to LV, does not preclude it from being a parody.”

The key here is that My Other Bag is not using Louis Vuitton's trademarks solely to increase sales of My Other Bag’s products by inducing consumers to mistakenly believe the totes are Louis Vuitton bags or somehow sponsored or endorsed by Louis Vuitton. Instead, My Other Bag is primarily using the trademarks to parody Louis Vuitton’s high-end luxury image. On that basis, the Second Circuit affirmed the trademark dilution part of the district court’s award of summary judgment in favor of My Other Bag, too.

The Lesson For Brand Owners

Brand owners should diligently protect their trademarks from infringement, dilution and other misuse (e.g., unfair competition, passing off, false advertising and cybersquatting) that may harm the owner's goodwill and business reputation. At the same time, brand owners may choose not to vigorously pursue all possible uses that might conflict, or to immediately commence a lawsuit against every possible infringer. Of course, a complete failure to enforce will lead to a weakening of an owner’s marks, loss of distinctiveness over time and potential forfeiture of certain available remedies.

Nonetheless, when potential infringements are identified, brand owners should investigate and evaluate all relevant factors such as type of use and likelihood of confusion, and consider defenses such as parody. Lawsuits are costly in terms of time, money and resources, so legal enforcement priorities should be established based on appropriate considerations. Doing so will help brand owners avoid losses similar to Louis Vuitton’s at the district court level and again on appeal, as well as the "Streisand effect" unintended consequences of actually helping to publicize and promote My Other Bag’s products, and perhaps emboldening others to create and sell products that parody Louis Vuitton’s high-end luxury image.

Oliver Herzfeld is the Chief Legal Officer at Beanstalk, a leading global brand extension agency and part of the Diversified Agency Services division of Omnicom Group.