Rosetta Stone’s Trademark Infringement Suit Against Google Resuscitated by Fourth Circuit

Rosetta Stone sued Google over Google’s keyword search and advertising trademark use policies, contending that those policies create both a likelihood of consumer confusion and actual consumer confusion.  Rosetta Stone asserted that the likelihood of confusion and actual confusion misleads Internet purchasers into purchasing counterfeit Rosetta Stone software.  Rosetta Stone claimed the Lanham Act (trademark law) claims of direct, contributory and vicarious trademark infringement and trademark dilution, and the state law claim of unjust enrichment.

The district court granted Google’s summary judgment motion on the Lanham Act claims and dismissed the unjust enrichment claim.  On appeal, the Fourth Circuit affirmed the district court’s rulings on the vicarious infringement and unjust enrichment claims, but vacated the district court rulings on the direct infringement, contributory infringement and dilution claims and remanded those claims to the district court for further proceedings.

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Betty Boop Court Misses the Trademark

Controversy surrounds the 9thCircuit’s ruling in the Betty Boop case (Fleischer v. A.V.E.L.A.).  I felt reluctant to do a post on this case because there are already some sagacious posts on this topic by highly respected commentators:  Betty Boop And The Return of Job’s Daughters by Marty SchwimmerWho Knows Who Owns Betty Boop by Pamela ChestekBetty Boop as a Material Girl by Rebecca Tushnet and An Opinion That Cries Out For A 9th Circuit En Banc Review…Betty Boop and The Tangled Character Copyright and Trademark Chain of Title  by Kate Spelman.  I decided to take the plunge after realizing that my take is different from what I have read so far and because it’s such an intriguing topic.

I have a question and a comment about this case:

Question:  Does the court believe that trademarks should be limited in duration, like copyrights?

Comment:  The Betty Boop plaintiff loses because of the court’s completely inapplicable analogy.  The court generalized from a case in which the trademark owner failed to timely assert its rights in its mark to this case in which the trademark owner did timely assert its rights. 

Here is a brief summary of the case.  The Betty Boop cartoon character was created by Max Fleischer in the 1930s.  He sold the rights to her cartoon and character around 1946.  The Fleischer family revived the Fleischer cartoon business in the early 1970s, repurchasing intellectual property rights to the Betty Boop character.  A.V.E.L.A., the defendant, started selling Betty Boop merchandise sometime after the Fleischer family began to bring the Betty Boop character back into circulation.  Fleischer sued A.V.E.L.A. for copyright and trademark infringement.

The district court dismissed the case on summary judgment.  The 9th Circuit affirmed.  The 9th Circuit’s ruling on the trademark part of the case creates the most controversy.  The circuit court determined that the parties’ arguments were moot and that the controlling precedent was its decision in International Order of Job’s Daughters v. Lindeburg, a case which neither party cited.

Job’s Daughters is an organization that used its name and emblem as trademarks.  Lindeburg manufactured jewelry with the Job’s Daughters emblem without a license.  Job’s Daughters sued for trademark infringement.  The 9thCircuit held that Lindeburg did not use the Job’s Daughters name and emblem as trademarks, that consumers purchased the jewelry for its design and did not purchase it because it was sponsored by the organization the emblem signified.  Jewelry with the Job’s Daughter’s emblem was available from many different unlicensed sources and consumers did not ordinarily purchase jewelry from only “official sources.”  In addition, Lindeburg manufactured unlicensed jewelry with the Job’s Daughters emblem between 1954 and 1975 before Job’s Daughters finally took action.  Job’s Daughters did not police its trademark when it should have, and when it did try to enforce its exclusive rights in the mark, it was too late.

The Betty Boop court applied its Job’s Daughters ruling to the Betty Boop facts and determined “that A.V.E.L.A. is not using Betty Boop as a trademark, but instead as a functional product.”

It is true in Job’s Daughters that the consumers bought the unlicensed jewelry as a functional product.  This resulted from the failure of the trademark owner to enforce the mark, not because of the intrinsic functionality of the jewelry.  The court in Job’s Daughters should have determined that the trademark owner did not enforce the mark and let it go at that.  Instead, the court created a bad precedent which it used in the Betty Boop case.

This language from the Betty Boop case is particularly interesting for rights holders of properties that are subject to both copyright and trademark protection:

If we ruled that A.V.E.L.A.’s depictions of Betty Boop infringed Fleischer’s trademarks, the Betty Boop character would essentially never enter the public domain.

This quote above is based on Dastar Corp. v. Twentieth Century Fox Film Corp. In Dastar, Fox neglected to renew its copyright on a television series it created under license and based on General Dwight D. Eisenhower’s book about the World War II allied campaign in Europe.  The television series entered the public domain.  Fox later acquired rights to Eisenhower’s book, including the exclusive right to distribute and sublicense the television series on video.  Dastar used footage from the television series to manufacture its own video set of the allied campaign, without attributing any of it to Fox.  Fox sued Dastar for copyright infringement.  Fox tacked on a Lanham Act §43(a) (a.k.a. §1125(a)) claim for “reverse passing off,” which is the infringer passing off the trademark owner’s goods as the infringer’s own goods.  Ordinary “passing off” is when the infringer passes off his goods as the trademark owner’s goods.  Fox could not overcome the failure to maintain the copyright and tried to rely on a claim for an unregistered trademark to save the day.  Fox tried to regain its copyright in the television series, which it allowed to slip into the public domain, by using a trademark theory and the court didn’t buy it.  Dastar is another case with a very narrow range of supportable application.

Different types of intellectual property offer different protections.  Properly maintained trademarks do not enter the public domain.  Whether the expiration of a copyright causes a property that is also protected by a trademark to enter the public domain is hotly debated. Does the court mean to suggest that long time trademarks such as IBM and Sears should someday enter the public domain?

The court also failed to acknowledge that Betty Boop is essentially a cartoon character.  Cartoon characters differ from other trademarks in that the product, the cartoon, is the same as the trademark, the cartoon.  Thus, it misses the point to look at the functional aspect of a product derived from the cartoon.  I posted a paper on this subject entitled Trademark Protection for Cartoon Characters on my website.