High Court Asks Disney to Respond in Another ‘Rogers’ Challenge

The US Supreme Court asked Disney to respond to a petition asking it to reconfigure a rule for trademarks in expressive works—roughly two weeks after agreeing to hear a case challenging the same rule.

Diece-Lisa Industries Inc. appealed a finding that Disney Store USA’s “Lotso Bear” character in Toy Story 3 didn’t infringe its “Lots of Hugs” toy trademark because it passed an expression threshold known as the Rogers Test. Like Jack Daniel’s Properties Inc.—whose just-granted petition protested a court’s approval of a whiskey bottle-shaped, pun-laden dog toy—Diece-Lisa argues the test has become far too broadly applied.

The Dec. 2 request adds to the justices’ decision to hear the “Bad Spaniels” dog toy case as evidence the court has decided to take a hard look at the Rogers test. That Second Circuit-created test allows the unauthorized use of trademarks in “expressive works” as long as they’re artistically relevant and not explicitly misleading.

The response is due Jan. 3.

Diece-Lisa’s petition said Disney’s movie character, a pink stuffed bear like the one it sells, didn’t need to be named “Lots-o-Huggin’"—Lotso for short—and also directly competed with Diece-Lisa’s by selling Lotso toys. But the US Court of Appeals for the Ninth Circuit, which like several circuits has adopted Rogers, said the character and related merchandise qualified to be evaluated and cleared under the test, and declined Diece-Lisa’s invitation to strike its precedent.

The petition also said Rogers should be modified in cases of reverse confusion, as the junior user isn’t accused of riding the coattails of a trademark owner but of subsuming the smaller entity’s rights. The rule “makes no sense,” as it’s impossible to be explicitly misleading for consumers who don’t yet know of the senior mark-owner, the petition said. That means the junior user will always win the analysis, it said.

While lacking the reverse confusion element, the Jack Daniel’s petition also claimed the Rogers test has been over-applied, and shouldn’t encompass “consumer products” like dog toys and toy bears. Both petitions argued that the test—originally applied to the title of a movie about Ginger Rogers—has expanded far beyond its original purpose, allowing use of marks on virtually any product without regard to consumer confusion.

Opponents of the Jack Daniel’s bid have countered that there’s no legal distinction between expressive works and consumer products incorporating expression, and that First Amendment interests justify the risk of some consumer confusion absent fraud—the fundamental target of trademark infringement.

Whitaker Chalk Swindle & Schwartz PLLC and DTO Law represent Diece-Lisa.

The case is Diece-Lisa Industries Inc. v. Disney Store USA LLC et al., U.S., No. 22-347, Response requested 12/2/22.