Intellectual Property Attorney

Louis Vuitton Loses Trademark Infringement Action Against Warner Bros. Over Knock-Off Featured In ‘The Hangover: Part II’

We have blogged extensively about the importance of effective anti-counterfeiting strategies and
protecting valuable trademark rights, but sometimes having a sense of humor is a much more cost effective approach — a lesson high-end luxury designer Louis Vuitton Mallatier, S.A. (“Louis Vuitton”) may have learned the hard way.

Early in the film The Hangover: Part II, the sequel to the 2009 blockbuster
The Hangover, the four unforgettable main characters walk through Los Angeles International Airport on their way to board a flight to Thailand for Stu’s marriage. Socially awkward Alan carries an over-the-shoulder bag appearing to bear famous Louis Vuitton symbols and
trademarks. Alan places the bag on an empty seat between him and Stu. Teddy, Stu’s soon-to-be brother-in-law, asks to sit in the empty seat but Alan responds, “Wolfpack only. Find another chair.” Stu moves the bag to the ground but Alan protests, “Careful that is…that is a Lewis Vuitton.”

Following the release of the film, Louis Vuitton sent Warner Bros. a cease and desist letter claiming that the bag used by Alan was a knock-off made by Diophy and objecting to the “misrepresentation in the film of the infringing Diophy Bag as a genuine Louis Vuitton product.” In spite of Louis Vuitton’s letter, Warner Bros. released the The Hangover: Part II on DVD and Blu-Ray on December 6, 2011. Just a few weeks later, on December 22, 2011, Louis Vuitton filed an action in the United States District Court for the Southern District of New York claiming that use of the knock-off Diophy bag by Warner Bros. constituted false designation of origin/unfair competition in violation of the Lanham Act, 15 U.S.C. § 1125, common law unfair competition and trademark dilution in violation of New York General Business Law 360-l. Louis Vuitton alleged that harm to the company had been “exacerbated by the prominent use of [the scene] and the [Louis Vuitton trademarks] in commercials and advertisements,” and that the “Lewis Vuitton” line had “become an oft-repeated and hallmark quote from the movie.” Louis Vuitton believed that “the public, including Louis Vuitton customers and potential consumers, have been misled into believing that the Diophy Bag is a genuine Louis Vuitton bag.”

Warner Bros. moved to dismiss the complaint claiming that its use of the Diophy bag was protected by the First Amendment to the U.S. Constitution. The district court, Judge Andrew L. Carter, Jr., agreed.

As Judge Carter correctly held, the Lanham Act does not apply to “artistic works” so long as the use of the trademark is “(1) ‘artistically relevant’ to the work and (2) not ‘explicitly misleading’ as to the source or content of the work.” He wrote, the “threshold for ‘artistic relevance’ is purposely low and will be satisfied unless the use ‘has no artistic relevant to the underlying work
whatsoever.'” (citing
Rogers v. Grimaldi, 875 F.2d 994, 999 (2d Cir. 1989)). Warner Bros. cleared the low hurdle. Judge Carter even went so far as to carefully parse and analyze the scene:

Alan’s terse remark to Teddy to “[b]e careful” because his bag “is a Lewis Vuitton” comes across as snobbish only because the public signifies Louis Vuitton–to which the Diophy bag looks confusingly similar–with luxury and a high society lifestyle. His remark also comes across as funny because he mispronounces the French “Louis” like the English “Lewis,” and ironic because he cannot correctly pronounce the brand name of one of his expensive possessions, adding to the image of Alan as a socially inept and comically misinformed character.

(internal citations omitted).

Louis Vuitton attempted to keep the case alive claiming that it could not determine whether the use of the knock-off bag was “artistically relevant” without discovery, including reviewing the script and deposing the creators. Judge Carter held that the discovery would be irrelevant because there had been no indication that Warner Bros.’ use was commercially motivated — “The Court is satisfied that Warner Bros.’ use of the Diophy Bag (whether intentional or inadvertent) was intended to create an artistic association with Louis Vuitton, and there is no indication that its use was commercially motivated.”

Louis Vuitton was also not successful in arguing that the use was “explicitly misleading” with respect to the source or content of the work. Judge Carter wrote, “Louis Vuitton does not allege that Warner Bros. used the Diophy bag in order to mislead consumers into believing that Louis Vuitton produced or endorsed” The Hangover: Part II. Moreover, he held that “Louis Vuitton’s allegations of confusion are not plausible, let alone ‘particularly compelling.'” He recognized that “the Diophy bag appears on screen for no more than a few seconds at a time and for less than thirty seconds in total, and when it is on screen, it is usually in the background, out of focus, or partially obscured by other things.” Thus, Judge Carter determined “that the difference between the authentic and knock-off bag is so difficult to even notice, that a claim of confusion under the Lanham Act is simply not plausible.” (internal quotation omitted)).

There is no doubt that intellectual property owners must vigorously protect their rights against unlawful exploitation and infringement. However, any cost-effective and smart strategy requires a modicum of common sense or else intellectual property owners risks thousands or millions of dollars in wasted, unproductive litigation and enforcement actions. The case is Louis Vuitton Mallatier, S.A. v. Warner Brothers Entertainment Inc., 11-Civ-9436 (ALC)(HBP) (S.D.N.Y.).

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