DuetsBlog Collaborations in Creativity & the Law

Successful Evolution of an Unlicensed Business Model?

Posted in Agreements, Articles, Branding, Contracts, Fair Use, First Amendment, Infringement, Law Suits, Marketing, Non-Traditional Trademarks, Trademarks, Truncation

Brand owners and managers may wonder, is a trademark license required when another’s unregistered color scheme is used? Depending on the facts, it may very well be.

About four years ago brand owners scored a major victory in LSU v. Smack Apparel, when the Fifth Circuit Court of Appeals agreed to the existence and successful enforcement of non-traditional and unregistered trademark rights in color schemes when combined with ”other identifying indicia” (indirect references to the brand owner – in this case, Louisiana State University), prohibiting the sale of t-shirts like this (absent a license from the brand owner), pursuant to Section 43(a) of the Lanham Act:

Smack Apparel’s arguments in defense of its unlicensed status and against the lower court’s ”likelihood of confusion” determination were not successful:

“We hold that given the record in this case and the digits of confusion analysis discussed above-including the overwhelming similarity between the defendant’s t-shirts and the Universities’ licensed products, and the defendant’s admitted intent to create an association with the plaintiffs and to influence consumers in calling the plaintiffs to mind-that the inescapable conclusion is that many consumers would likely be confused and believe that Smack’s t-shirts were sponsored or endorsed by the Universities. The Universities exercise stringent control over the use of their marks on apparel through their licensing program. It is also undisputed that the Universities annually sell millions of dollars worth of licensed apparel. We further recognize the public’s indisputable desire to associate with college sports teams by wearing team-related apparel. We are not persuaded that simply because some consumers might not care whether Smack’s shirts are officially licensed the likelihood of confusion is negated. Whether or not a consumer cares about official sponsorship is a different question from whether that consumer would likely believe the product is officially sponsored. For the foregoing reasons, we conclude that a likelihood of confusion connecting the presence of the Universities’ marks and the Universities’ themselves was demonstrated in this case.”

The decision was not without criticism from academics and others concerned about what they may consider to be an unwarranted proliferation of trademark rights that may stifle free speech and competition in the marketplace. So, what ever happened to Smack Apparel, you might ask?

A recent trip to the legendary Iowa Book & Supply Store (more recently truncated to Iowa Book), revealed to me that despite its loss at the Fifth Circuit Court of Appeals, Smack Apparel is still very much in business, and remains quite proud of its unlicensed status — representing itself as being “licensed ONLY by the first amendment” — in selling college rivalry t-shirts like these now:

Apparently Smack Apparel is operating under the belief that these t-shirts contain no “other identifying indicia” — unlike the enjoined purple and gold t-shirts having more than simply the colors to identify LSU – since the only statements on these rivalry t-shirts are anti-Nebraska Cornhusker for the black and gold (colors for the University of Iowa) or anti-Iowa for the red and white (colors for University of Nebraska). Incidentally, this same style of t-shirt appears available for just about any college team you might follow.

The Smack Apparel website displays this warning when you’re considering an online order: “This shirt is not licensed or endorsed by any institution or organization.  Its sole purpose is to enable the individual wearing it to express the message contained on it.”

Part of the Smack Apparel story claims this about its unlicensed status: “It is not that we are averse to being licensed; we are just averse to the CREATIVE RESTRICTION that would come along with being licensed.  If we couldn’t do “CHOKE…The Official Drink of Michigan Football” or “C.U.B.S…Completely Useless By September” it just wouldn’t be any fun (Sorry Michigan and Cubs fans)!”

Putting aside the question of whether Smack Apparel hears from The Most Interesting Man in the World, it will be interesting to see whether the Universities take another shot at Smack Apparel.

If so, perhaps Indiana University should be the lead plaintiff, given the “other identifying indicia” present on this currently available example:

What do you think, has Smack Apparel successfully evolved its business model to avoid further trademark infringement problems or is it likely to get the smack down again?

Finally, while we’re on the subject of collegiate color trade dress, remember this blast from the past? “Sit Down Michigan State,” A Collegiate Trade Dress Tale