“Bad Spaniels” Dog Toy Prevails over Jack Daniels in a Trademark War Over the Brand’s Famous Marks

dog toy resembling a Jack Daniel’s whiskey bottle is free to squeak again after its maker won a long-awaited victory in early August..

In August, the Ninth Circuit lifted an injunction that had halted VIP Products LLC (“VIP”) from selling its “Bad Spaniels” dog toy. The ruling followed more than a decade of litigation over trademark claims brought by Jack Daniel’s Properties, Inc. (“JDPI”).

The Ninth Circuit held that neither the “Bad Spaniels” mark nor the toy’s trade dress facially tarnished JDPI’s corresponding famous marks. The court also found that expert testimony did not establish a negative association likely to harm Jack Daniel’s reputation. In doing so, the court clarified how dilution-by-tarnishment claims should be analyzed under the Trademark Dilution Revision Act (“TDRA”).

The dispute began in September 2014, when JDPI demanded that VIP stop selling its Bad Spaniels squeaky dog toy. VIP designed the toy to resemble a Jack Daniel’s bottle, but with several key differences: “Jack Daniel’s” became “Bad Spaniels”; “Old No. 7 Brand Tennessee Sour Mash Whiskey” became “Old No. 2 On Your Tennessee Carpet”; and “40% ALC. BY VOL. (80 PROOF)” became “45% POO BY VOL.”

VIP responded by seeking a declaration that the Bad Spaniels mark did not infringe or dilute JDPI’s trademarks. JDPI has held trademarks for “Jack Daniel’s” since 1875 and “Old No. 7” since 1904, and it also holds a trademark for the Jack Daniel’s bottle design, or trade dress. JDPI counterclaimed for trademark infringement and dilution under the TDRA, arguing that the toy negatively associated its whiskey with dog excrement.

The dispute reached the Supreme Court in 2023 but was ultimately sent back to the district court, which found no likelihood of confusion, but held VIP liable for dilution by tarnishment and barred it from selling the toy. VIP appealed.

The appeal focused on how the TDRA’s tarnishment standard applies to the dog toy. The TDRA allows the owner of a famous mark to stop commercial use of another mark that is likely to dilute the famous mark by tarnishment.

The Ninth Circuit explained that JDPI had to prove three elements for each mark: (1) the senior mark is famous; (2) the famous senior mark is similar to the corresponding junior mark; and (3) the junior mark is likely to harm the reputation of the famous senior mark. The court found that JDPI proved fame only for the “Jack Daniel’s” mark and its trade dress.

Second, the court found that neither “Bad Spaniels” nor the toy’s trade dress facially tarnished JDPI’s corresponding famous marks. It also concluded that JDPI’s expert testimony did not establish a negative association likely to harm JDPI’s reputation.

The Ninth Circuit also addressed parody. The Supreme Court had held that the TDRA’s noncommercial-use exclusion does not automatically protect parody or commentary when a mark is used as a source identifier (see Jack Daniel’s Props., Inc. v. VIP Prods. LLC, 599 U.S. 140, 163 (2023)). Even so, the Ninth Circuit joined the Second and Fourth Circuits in holding that parody may still matter when evaluating likely dilution. An obvious parody evokes the original while signaling that it is not the original. Consumers are therefore more likely to view it as a joke rather than as something that harms the famous mark’s reputation.

The Ninth Circuit held that the district court erred by failing to consider how VIP’s obvious parody affected the likelihood of tarnishment. It also held that JDPI had not shown likely dilution by tarnishment of either the “Jack Daniel’s” mark or the bottle trade dress. The court ultimately vacated the permanent injunction and remanded the case for entry of judgment in VIP’s favor.

Takeaways

The decision underscores that tarnishment must be analyzed on a mark by mark basis. A plaintiff must prove that each asserted mark is famous, compare each famous mark with the corresponding junior mark, and show that the junior mark is likely to harm that famous mark’s reputation. A non-famous mark cannot rely on the fame of another mark, and general expert testimony about negative associations may not prove harm to a specific famous mark. The decision also confirms that courts may consider parody when evaluating likely dilution.