Summit Entertainment, LLC v. B.B. Dakota, Inc., No. 10-CV-04328 (C.D. Cal. Nov. 21, 2011) The cargo jacket worn by the character Bella Swan in the 2008 Twilight movie is the subject of the instant trademark and copyright dispute filed against the manufacturer of the jacket, which used a film image and film trademarks without authorization. The U.S. District Court for the Central District of California granted in part, and denied in part, plaintiff Summit Entertainment, LLC's motion for summary judgment. In doing so, the court found that Summit was able to establish most of its trademark and copyright claims as a matter of law, with the exception of its trademark dilution claim. As to that claim, the court could not decide whether the TWILIGHT mark was legally famous, despite the fact that the film series grossed $1 billion.
The "Twilight" JacketSummit is the producer and distributor of the Twilight film series, the first of which was released in 2008, the second in 2009, and the third in 2010. The films together generated $1 billion in gross revenue. Summit is also the owner of the films' intellectual property, the licensing of which produced another $63 million in revenue. This intellectual property includes the federally registered TWILIGHT trademark, in both standard character and stylized form, for a number of goods, including clothing. Summit also owns a federally registered mark for BELLA'S CHARM BRACELET and has filed an application for the BELLA TWILIGHT mark. In addition to its trademarks, Summit owns various copyrights for the film and its promotional materials. Defendant B.B. Dakota, Inc. ("BB") is a women's clothing manufacturer that sells clothes directly to consumers via its website and through brick and mortar retailers. In 2006, it manufactured a cargo jacket named the "Leigh" jacket, which was discontinued in 2008. Bella Swan, a character in the Twilight films, wore that jacket in the film, and in 2009, Entertainment Weekly ("EW") published a movie still depicting Bella in the jacket. There was also a photo of the jacket itself, and a note identifying BB as the manufacturer. BB subsequently reinstituted production of the jacket, renaming it the "Twilight" jacket. In March 2009, BB's outside public relations contractor, Erika Klein, contacted EW to request permission to use the EW photo on its website. EW informed Klein that BB would need permission from Summit. Klein then contacted Summit and requested permission to republish the EW Photo, inserting a link to a webpage that included several photos, including the EW Photo. A Summit executive responded "ok." Klein later contacted the Summit executive again and asked if a retailer, Metropark, could also use the EW Photo on its website to promote the jacket. The Summit executive replied "sure." After this email exchange, BB created hangtags to affix to the jackets that did not include the EW Photo, but instead included a copyrighted photograph of Bella wearing the jacket that had been used for film promotion ("Bella Photo").
Photo Attached as Complaint ExhibitKlein later testified that when she informed BB executives that they did not have the right to use the Bella Photo, the executives retorted that they could use the Bella Photo as long as they included the language "As seen in the movie Twilight." Summit at 5. Furthermore, BB argued that because Klein had included a link to the image (although she specifically identified the EW Image), it was ambiguous which image she was referencing, and could have included the Bella Photo. BB admitted that the hangtag was larger than customarily used by BB and that it was the only instance in a six year period where BB created a hangtag for an individual item instead of a line of clothing. BB then authorized two retailers, Metropark and ModCloth, Inc., to use the Bella Photo on their respective websites to promote the jacket. BB also created and distributed point of sale displays incorporating the Bella Photo for display in retail stores. Summit became aware of the activities occurring at the retail stores and sent cease and desist letters to Metropark and ModCloth. Summit ultimately brought suit against BB, Metropark, and ModCloth for false designation of origin, trademark infringement, trademark dilution, copyright infringement, and unfair competition. BB asserted counterclaims of trade dress infringement and unfair competition. After the suit was filed, BB ceased use of the Bella Photo and instructed retailers to cut the hangtags from the jackets. BB also changed the name of the jacket from the "Twilight" jacket to the "Nicola" jacket.
Court Rejects Nominative Fair Use DefenseSummit alleged that defendants' use of the TWILIGHT and BELLA trademarks, as well as their use of the Bella Photo, constituted false designation of origin under 15 U.S.C. § 1125(a), that the unauthorized use of the marks was likely to cause confusion as to the source or origin of the jacket in violation of 15 U.S.C. § 1114, and similar violations under California statutory and common law. These trademark claims all require the same three elements: (1) ownership of a valid, protectable trademark; (2) that the defendant used the mark without consent or authorization; and (3) that the defendant's use of the mark is likely to cause confusion. Summit at 11 (citing 15 U.S.C. § 1114(1)). The court found that there was no genuine issue of fact with respect to the ownership of the TWILIGHT and BELLA marks for clothing and film merchandise and, therefore, focused on the likelihood of confusion element. As to whether BB's use created a likelihood of confusion, BB claimed that its use of the marks was a nominative fair use. The nominative fair use analysis, articulated in New Kids on the Block v. News America Publishing, Inc., 971 F.2d 302, 308 (9th Cir. 1992), queries whether: (1) the product was not readily identifiable without the use of the trademark; (2) the defendant only used as much of the mark as was reasonably necessary to identify the product; and (3) the defendant took any actions in conjunction with the mark that would suggest sponsorship or endorsement by the trademark owner. Summit acknowledged that the film series is not readily identifiable without use of the TWILIGHT mark. However, the court questioned "whether any use was necessary given the fact that the jacket had been successfully marketed for two to three years before the first Twilight movie was released." Summit at 15. Even if reference to the TWILIGHT trademark was necessary, the court noted that it was unnecessary to use the stylized version of the mark or the Bella Photo, or to rename the jacket the "Twilight jacket." BB countered that a jury could find that two or three references to the mark were not excessive. However, the court explained that the analysis is not a numerical one; rather, the question is whether BB's use was intended to associate BB's goods with Summit's product. The court reasoned that "BB clearly sought to associate its product with the highly successful Twilight series to enhance its own profits." Id. at 16. In addition, the jacket was sold in some retail outlets where Summit's Twilight-related clothing was also sold. The court acknowledged that use of identical retailers alone will not defeat a nominative fair use defense; however, in the instant case, both Metropark and ModCloth attested that they believed BB had permission from Summit to use the marks. The court agreed with Summit that if sophisticated marketing executives in the retail clothing industry were confused, the average consumer would also likely be confused. The court thus concluded that Summit had adequately defeated BB's nominative fair use defense, and accordingly, granted summary judgment to Summit on its claims of trademark infringement, false designation of origin, and unfair competition.
Trademark Dilution ClaimSummit also alleged trademark dilution, but the court denied summary judgment as to this claim because Summit did not establish as a matter of law that its TWILIGHT mark is famous. As evidence of fame, Summit contended that it has spent $75 million promoting the mark, received more than $1 billion in gross revenues from the Twilight films, and sold over 25 million DVD units. Despite this evidence, the court found disputed issues of material fact as to whether the mark is famous for dilution purposes. The court noted that although the TWILIGHT mark is a strong mark, it is also used by others. The court further noted that Summit failed to provide survey evidence demonstrating the requisite level of consumer recognition. Thus, even though Summit established that BB's use was likely to cause dilution, the court denied Summit's motion for summary judgment because it failed to prove the fame element of its dilution claim.
Copyright Infringement ClaimWhile it was undisputed that BB reproduced and distributed the Bella Photo, BB argued that its use was a fair use; that Summit had granted consent for the use through the series of emails with Klein; and that Summit was equitably estopped from bringing a copyright infringement claim due to the time that lapsed before Summit filed suit. The court rejected the fair use defense, finding that BB used the copyrighted image in its entirety, solely for a commercial purpose, and that the use was not transformative. The image was also not necessary to inform customers, as BB could have merely referenced the film without an image. Finally, BB's use negatively impacted the potential market for the work by depriving Summit of the licensing revenue it would have received had BB legally secured the right to use the Bella Photo. The court also rejected BB's argument that it had consent, finding that the emails clearly referenced the EW photo, not the Bella Photo, without ambiguity. "[L]icenses to use intellectual property are complex, and casual language in an email exchange cannot so readily be construed to implicitly grant rights not clearly stated within." Summit at 35. Finally, the court rejected BB's argument of copyright estoppel. BB failed to establish that Summit's awareness of Metropark's actions equated to knowledge that BB was the initiator of the infringing conduct. Furthermore, BB was not ignorant of the truth, but instead was aware, due to Klein's repeated advice, that authorization from Summit to use the Bella Photo was required. Nor was there evidence that Summit intended BB to rely on its conduct, manifested as providing cease and desist letters to retailers without directly contacting BB, particularly since Summit brought suit against BB once it ascertained that BB was the source of the infringement. Accordingly, the court granted summary judgment to Summit on its claim of copyright infringement.
Trade Dress Infringement and Unfair Competition CounterclaimsFinally, the court rejected BB's counterclaims of trade dress infringement and unfair competition. BB alleged that it had established secondary meaning in the jacket, due to its years of extensive sales and promotion prior to the release of the Twilight films, and that Summit infringed BB's rights by using and licensing others to use images of the character Bella wearing the jacket for advertising and promotional purposes. The court explained that trade dress must be protectable and have acquired secondary meaning, and that to establish a claim of trade dress infringement, a plaintiff must show a likelihood of confusion between the trade dress and the defendant's goods or services. BB made the unusual argument that although the jacket acquired secondary meaning due to the popularity of the film, the secondary meaning was attributable to BB and the jacket, not to the association with the film, and consequently, that Summit was now infringing on that secondary meaning. "No support is provided for such an unusual argument, and as a logical matter, the Court finds it unpersuasive," particularly since BB had discontinued manufacturing the jacket prior to its debut in the film. Summit at 38. The court therefore granted summary judgment to Summit on BB's trade dress and unfair competition counterclaims. DisclaimerThis document and any discussions set forth herein are for informational purposes only, and should not be construed as legal advice, which has to be addressed to particular facts and circumstances involved in any given situation. Review or use of the document and any discussions does not create an attorney-client relationship with the author or publisher. To the extent that this document may contain suggested provisions, they will require modification to suit a particular transaction, jurisdiction or situation. Please consult with an attorney with the appropriate level of experience if you have any questions. Any tax information contained in the document or discussions is not intended to be used, and cannot be used, for purposes of avoiding penalties imposed under the United States Internal Revenue Code. Any opinions expressed are those of the author. The Bureau of National Affairs, Inc. and its affiliated entities do not take responsibility for the content in this document or discussions and do not make any representation or warranty as to their completeness or accuracy.©2014 The Bureau of National Affairs, Inc. All rights reserved. Bloomberg Law Reports ® is a registered trademark and service mark of The Bureau of National Affairs, Inc.
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