By Sara Balice & Elena Varese (DLA Piper Milan)

  • A little bit of an introduction

There are a number of fashion players that base their business on the very thin line running between tribute and misappropriation. In this context it is difficult to understand how quotations of well-known fashion trademarks made in a humoristic context should be treated, especially as the EU legislation did not provide any guidance on the parody fair use defence. At least, up to now.

In fact, Regulation (EU) No. 2015/2424 of the European Parliament and of the Council of 16 December 2015, now provides in its Recital 21 that “use of a trade mark by third parties for the purpose of artistic expression should be considered as being fair as long as it is at the same time in accordance with honest practices in industrial and commercial matters. Furthermore, this Regulation should be applied in a way that ensures full respect for fundamental rights and freedoms and in particular the freedom of expression“.

The above provision has not raised much attention, at the moment, however, it might have a relevant impact on the criteria to interpret the parody fair use defence within the EU and Member States’ trademark laws.

Traditionally, the concept of parody is more spread in Copyright Law and this is true also at EU level, as Article 5, par. 3, letter k) of the InfoSoc Directive, provides that Member States may allow exceptions or limitations to the exclusive rights of a copyright holder “for the purpose of caricature, parody or pastiche“.

In the copyright case C-201/13 Deckmyn, the CJEU has observed that there is no definition in the EU Law of the meaning and scope of a parody, thus such meaning should be determined based on everyday language. In light of this, the essential characteristics of a parody were found in “first, to evoke an existing work while being noticeably different from it, and, secondly, to constitute an expression of humour or mockery“.

Nonetheless, the CJEU stated that, when determining the applicability of the parody-exception, it is for the Member States’ courts to strike a “fair balance” between the right holders’ interests and the rights of those who seek to make use of copyrighted works, by taking into account all the circumstances of the case, including for instance, the fact that the parody conveys a discriminatory message, which has the effect of associating the protected work with such a message.

It is reasonable to assume that the above copyright law principles might also apply to parody in the context of trademark law. However, the issue is not straightforward: whilst in the USA the Courts are more inclined to go along with parody fair use defence, Europe, including Italy, is still quite reluctant in upholding such defence, especially against the commercial non-authorized use of a well-known trademark.

  • More room for parody in the U.S.

The more spread application of the parody exception in the context of trademark law within common law countries is well-represented by the US case Louis Vuitton Malletier S.A. v Haute Diggity Dog, LLC, No. 06-2267 (4th Cir. 13 November 2007), where the Fourth Circuit of the U.S. Court of Appeals rejected Louis Vuitton’s copyright and trademark infringement claims with respect to a chew toy labelled “Chewy Vuiton” that sold for less than $20 and mimicked one of the plaintiff’s handbags that retailed for $1190.

The Court found that parody can provide a valid defence to a dilution claim, as the “Chewy Vuiton” imitation, shown “as something to be chewed by a dog, pokes fun at the elegance and expensiveness of a LOUIS VUITTON handbag, which must not be chewed by a dog“. The Court concluded that “the dog toy irreverently presents haute couture as an object for casual canine destruction. The satire is unmistakable. The dog toy is a comment on the rich and famous, on the LOUIS VUITTON name and related marks, and on conspicuous consumption in general“.

  • Whilst EU is not very humoristic when it comes to well-known fashion brands

Unlike U.S. Courts, the parody exception has been denied by the Court of Justice of the European Union in some trademark cases. In a quite recent decision (Case T-265/13), the General Court held that the graphic representation of a person on a bicycle holding a polo mallet was a parody of the well-known polo player device and that its use, without due cause, infringed the trademark rights of a famous fashion house, as it took unfair advantage of, or was detrimental to, the distinctive character or the repute of their trademark.

  • Nor it is the Italian case-law (at least, up to now)

In accordance with European case law, Italian Courts have traditionally considered the ironic use of well-known trademarks for commercial purposes as a trademark infringement.

In two cases, the Court of Milan held that the use of a third party’s trademark would be justified where it is implemented as an artistic work (the best known example is Andy Warhol’s “Campbell’s Soup Cans“), but the parody defence would not apply in cases where a well-known trademark is used in someone else’s goods as a decorative element. The cases concerned the ironic use of certain fashion iconic trademarks of Chanel and Louis Vuitton on t-shirts produced and marketed by a third company under the trademark “Happiness is a $10 tee”.

In another case, the Court of Milan rejected the claim that the ironic depiction of a humanised crocodile incorporated reference to the well-known Lacoste trademark and could be confused with it. However, in this case, parody exception played a limited role as the Court held that the trademarks at issue were overall dissimilar.

  • Conclusions

As we have seen, Courts in Europe are still quite reluctant in upholding a parody fair use defence when a third party’s well-known trademark is used in goods or services for commercial purposes instead of being implemented as an artistic work. But things may change in the future, given that for the first time a European legislation on trademarks has dealt with this matter and has mentioned − albeit only in the Recitals − the fair use of a trade mark by third parties “for the purpose of artistic expression” and the “freedom of expression“.

Happy to discuss! Write us at sara.balice@dlapiper.com and elena.varese@dlapiper.com