Rolls Royce Wins Trademark Dilution Lawsuit Against Rapper But Loses On Trademark Infringement Claim

Rolls Royce Wins Trademark Dilution Lawsuit Against Rapper But Loses On Trademark Infringement Claim

March 28, 2016
by Jerry Glover

Luxury car company Rolls Royce recently sued rapper Robert D. Davis (a/k/a “Rolls Royce Rizzy”) in New Jersey federal court for trademark infringement (15 U.S.C. Sec. 1114(1)) and false designation of origin/unfair competition (15 U.S.C. Sec. 1125(a)(1)) under the federal trademark act commonly known as the Lanham Act, trademark dilution (15 U.S.C. Sec. 1125(c)) and several state law claims. The defendant performed music under his rap name on his YouTube channel and sold shirts that contained the words “Team Rolls Royce” through his online store, www.rollsroycerizzy.spreadshirt.com.

The singer did not answer Rolls Royce’s complaint so the court entered a default judgment against him. Rolls-Royce Motor Cars Limited v. Davis, No. 15-0417 (D.N.J. 2016).

In order to enter a default judgment, the court had to review the claims made by Rolls to determine whether the causes of action alleged were properly pleaded. The court noted that the U.S. Court of Appeals for the Third Circuit, which governs New Jersey, uses the same test to determine whether a defendant is liable for trademark infringement and false designation of origin: (1) Does the plaintiff have a valid and legally protectable mark? (2) Does the plaintiff own the mark? and (3) does the defendant’s use of the mark to identify goods or services cause a likelihood of confusion among the relevant consuming public?

There was no question that plaintiff owned the trademarks associated with Rolls Royce and the registrations for those marks were still in force. Therefore, the only question was whether Davis’ use of the Rolls marks was likely to cause consumer confusion. And that’s where Rolls failed. Yes, the marks used by Rolls and the singer were exactly the same and the mark was famous as arbitrary or fanciful marks. The marks were commercially strong and had been used for many years. But purchasers of plaintiff’s cars exercise a higher standard of care than the average consumer and would be less susceptible to confusion by Davis’s use of the marks (i.e., no one rich enough to afford a Rolls would every think that Rolls had authorized Davis to use the marks). The court noted that it could be argued that Davis intended to benefit from the reputation and high-end luxury image of Rolls-Royce but the court ultimately held that Davis must also have intended to cause confusion about his relationship with Rolls. The court found no such intention pointing to the posting Davis made on social media which made fun of the lawsuit as evidence of Davis himself insuring that there was no consumer confusion.

The court additionally noted that the parties operated in industries that were entirely separate and the products/services they offered were totally dissimilar. Consequently, the court found that Davis’s use of Rolls-Royce was not likely to cause consumer confusion.

But Rolls was luckier when it came to Rolls’ claim of trademark dilution under the Lanham Act. 15 U.S.C. Sec. 1125(c)(1). That portion of the laws states that “the owner of a famous mark that is distinctive, inherently or through acquired distinctiveness, shall be entitled to an injunction against another person who, at any time after the owner’s mark has become famous, commences use of a mark or trade name in commerce that is likely to cause dilution by blurring or dissolution by tarnishment of the famous mark regardless of the presence or absence of actual or likely confusion, of competition or of actual economic injury.” So, the likelihood of consumer confusion is not an element of proof that the plaintiff must provide in order to succeed on a dilution claim.

A word about the two types of dilution: tarnishment by blurring means there is an association between the similar marks that impairs the distinctiveness of the famous mark (the plaintiff’s mark); dilution by tarnishment means there is an association between the marks that harms the reputation of the famous mark.

The court had already noted in the trademark infringement discussion that the Rolls marks were famous. The court also noted that Davis was using the marks in interstate commerce since he used the name on his YouTube channel and sold Rolls shirts through his online store. Davis also began using the Rolls marks in 2014, well after the Rolls marks had become famous in the 20th century. The court ruled that Davis’ use of the marks lessened Rolls’ ability to use the marks as a unique identifier of its product (blurring) and that Davis’ use of the marks tarnished the Rolls reputation. What had Davis done? The court pointed to materials created by Davis (including both language and imagery) that could create negative associations with plaintiff’s products: ad advertising for an evening hosted by Rolls Royce Rizzy entitled “Call of Booty” which featured a scantily-clad woman and advertised a booty shaking contest; song titles including “Gah Damn” and “hoe in You”; the name of a Davis album “Pimp’n” which included a parent advisory for explicit lyrics.

THE TAKEAWAY: For our clients there is no takeaway since they would never be so stupid as to use such a famous mark like Rolls-Royce to identify their products/services, even if those products/services were totally unrelated to those produced or sponsored by the owner of the famous mark.

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