On November 19th, after over three (3) years of litigation, a jury in Williamsport, Pennsylvania finally found Vintage Brand, LLC (“Vintage”) and two other defendants liable for trademark infringement for selling counterfeit merchandise bearing the marks of The Pennsylvania State University (“Penn State”)[1]. Why did it take so long to reach this conclusion? A lesser known (and oft criticized) defense to trademark infringement called ornamentality.
"What You Need to Know”
- Trademark rights are the backbone of the college apparel business.
- Penn State was recently victorious in their three-year battle with various entities selling unlicensed university apparel. The defendants argued that their use of Penn State’s marks on clothing was ‘ornamental,’ and not a trademark use; a jury found otherwise.
- Universities need to monitor the apparel market carefully and pursue any unauthorized uses of trademarks.
The defense of ornamentality centers around the argument that one is not using someone else’s trademark as a trademark, they are using it simply as a decoration on another item (like a t-shirt). That is what various sellers of unauthorized Penn State apparel alleged when they were first charged with trademark infringement back in June 2021. Amazingly, this defense made it all the way to summary judgment briefing in June 2023, and even past that to a trial. The jury verdict for Penn State in Vintage Brand is a major victory for colleges and their official licensees, as well as apparel brands all over the world.
So how did the concept of ornamentality even come about? For that, we need to go back to the 1970s and a case brought by thirteen National Hockey League (“NHL”) member clubs, including my beloved Philadelphia Flyers. The case was Boston Professional Hockey Ass'n, Inc. v. Dallas Cap & Emblem Mfg., Inc.[2], and it dealt with a defendant making counterfeit NHL merchandise, namely cloth patches featuring team primary logos. The district court held that such sales by the defendants were not infringing on the basis that the patches were sold separately from any clothing item (“The statutory and case law of trademarks is oriented toward the use of such marks to sell something other than the mark itself.”)[3]. Essentially, the district court reasoned that the patches were mere ornamentation for another clothing item, and therefore their sale was not an infringement of the NHL clubs’ trademarks. The Fifth Circuit reversed and remanded, holding that the selling of the patches was, indeed, trademark infringement. But the uncertainty of the court in a case it deemed ‘difficult’ unknowingly spawned a new litigation defense, ornamentality. The Trademark Trial and Appeal Board (“TTAB”) tried to pump the brakes on the ornamentality defense in In re Olin Corp.[4], but the cat was out of the bag, so to speak. In that case, the U.S. Trademark Office (“USTO”) had refused registration of an “O” logo that Olin (yes skiers, the old 80s company) was using, finding that use of the logo on t-shirts was ornamental, and not a trademark use. The TTAB reversed, quite astutely pointing out: “the name ‘New York University’…albeit it will serve as ornamentation on a T-shirt will also advise the purchaser that the university is the secondary source of that shirt.”[5] Despite these decisions, the ornamentality defense has persisted in trademark litigation for over forty years.
Another related defense that has persisted in the apparel industry is that of aesthetic functionality, the argument that a mark may be lawfully used to show ‘brand allegiance’. The Ninth Circuit decision in Fleischer Studios illustrates this point[6]. There, a defendant was making and selling unauthorized merchandise featuring the mark “Betty Boop” (a famous cartoon character). The defendant argued that their use of the mark performed a ‘function’ of allowing the wearer to show support for the character, and thus, was not a trademark use. The court agreed, using words like “decorative” and “aesthetic” to describe the use of the mark on merchandise[7]. The court even went on to find that if the defendant was not permitted to use the mark, they would be at a significant “competitive disadvantage[8].” Does this reasoning sound familiar? It is very much like the reasoning behind the ornamentality defense, and would seem to completely undermine the concept of trademark goodwill. The defendants in Vintage Brand raised aesthetic functionality as an additional defense, but the jury ultimately found that none of Penn State’s marks were aesthetically functional.
So are there times when ornamentality is properly raised? Of course there are, but those instances mostly occur at the USTO during prosecution, not in litigation. One example the USTO gives is a t-shirt with the catchphrase “Swallow Your Leader” across the chest[9]. In that case, while the catchphrase may be inventive, it is not signifying the source of the t-shirts in the same manner as a t-shirt with “Penn State” on the chest. Also consider the Supreme Court’s decision in the ‘Trump Too Small’ case earlier this year[10]. An applicant tried to obtain a U.S. Trademark Registration on the phrase “Trump Too Small” and cited his use of the phrase on t-shirts. The Supreme Court held that the applicant could not use the name of a living individual as a trademark without his permission, and affirmed the rejection of the application. But even if the applicant had permission, the use was likely ornamental in nature.
Penn State attempted to get the ornamentality defense stricken at the pleading stage, but the court refused[11]. Judge Brann posited that “our modern trademark regime has struggled with this question” of whether an unlicensed party can use another’s marks to sell merchandise that allows people to “signal their support for the University…”. The court referenced Boston Hockey and In re Olin, but ultimately chose not to follow the decisions in those cases. The court’s reluctance to dismiss the ornamentality defense at the pleading stage led to over two more years of contested litigation.
As Penn State cleverly noted in its summary judgment brief[12], if you can’t tell the difference between authorized merchandise and counterfeit merchandise, then there must be trademark infringement. While maybe not an entirely accurate statement of the law, it does make a point. Below is the image Penn State used to prove that point – can you tell the difference? More importantly, can you discern which uses are ornamental and which uses are trademark uses? For the record, the last one on the top row is Vintage, as are the first and third ones on the bottom row.
Will the decision in Vintage Brand finally spell the end for the ornamentality defense? Probably not, but it is certainly another nail in the coffin. Colleges and universities need to be vigilant in protecting their brands, and this decision will no doubt help them to do that. Failure to police infringements can result in an abandonment of trademark rights in some circumstances, so colleges need to pay close attention to the merchandise market. On the flip side, apparel companies that seek to profit from the use of university trademarks without a license need to carefully consider the result in Vintage Brand. The ornamentality defense is still out there, but it is has been significantly weakened. Another court facing a similar argument in the context of university apparel will likely follow the court’s ultimate conclusion in Vintage Brand, and strike the defense at an early stage. Until then, courts may continue to struggle with concept of ornamentality.
My friends from Penn State talk about winning the National Championship every year, and this might be their year. But if that doesn’t happen, don’t fret, you’ve already won the biggest trademark victory of 2024.
[1] See The Pennsylvania State University v. Vintage Brand, LLC, et al. (M.D. PA. 2021), Docket No. 4:21-cv-01091-MWB (the “PSU Litigation” or “Vintage Brand”), Verdict Form [D.E. 335], Nov. 19, 2024.
[2] 510 F.2d 1004 (5th Cir. 1975), cert. denied, 423 U.S. 868, 96 S.Ct. 132, 46 L.Ed.2d 98 (1975) (“Boston Hockey”).
[3] Id. at 1010.
[4] 181 U.S.P.Q. 182 (Trademark Tr. & App. Bd. Nov. 19, 1973), 1973 WL 19761.
[6] Fleischer Studios, Inc. v. A.V.E.L.A., Inc., 925 Supp. 2d 1067 (C.D. Cal. 2012).
[7] Id. at 1074.
[8] Id. at 1075.
[9] See Trademark Manual of Examining Procedure (“TMEP”) § 1202.03(c); In re Paramount Pictures Corp., 213 USPQ 1111, 1112 (TTAB 1982).
[10] Vidal v. Elster, 602 U.S. 286 (2024).
[11] See Pennsylvania State University v. Vintage Brand, LLC, 614 F.Supp.3d 101 (M. D. Pa. 2022).
[12] See PSU Litigation, D.E. 114.
