Ninth Circuit upholds dismissal of Arizona State trademark lawsuit on Instagram account ASU_Covid.Parties

The case, delivered this morning, is Arizona Bd. of Regents v. Doe, decided by Judges Consuelo Callahan and Lawrence VanDyke and District Judge Yvonne Gonzalez Rogers (ND Cal.). (For more on the facts, see this post.)

Kudos to my UCLA First Amendment Clinic student, Max Hyams, who argued the case before the Ninth Circuit as an amicus in support of the decision below, and to students Daniel McDonald Meteer and Eimile Nolan, who also worked on the dossier. And thanks to Profs. Mark Lemley, Mark McKenna and Rebecca Tushnet, who filed an amicus brief in support of our position; to professors. David Babbe and Justin Bernstein, as well as Mark McKenna and Rebecca Tushnet, who participated in Max Hyams’ oral arguments; and, as always, to Scott & Cyan Banister, for their generous support of the Clinic.

In the opinion of the Ninth Circuit:

[1.] The District Court did not err in dismissing ABR’s complaint ex officio without leave to amend and without notice because an amendment would have been futile. See Wong v. Bell (9th Cir. 1981). With respect to all of ABR’s claims, an amendment would have been futile given the implausibility of the claims and the finding of likelihood of confusion. Of the eighteen posts by Doe included on the Instagram page, only one included use of ABR’s trademark and trade dress. This message contained profanity and a reasonable consumer would not think that a university would use such language when addressing the public. Reviewing the messages in their entirety does not change the result, but rather reaffirms it.

Moreover, an amendment would also have been futile given the non-commercial nature of Doe’s business. The Lanham Act was enacted to be applied in the commercial context, thus “infringement claims are subject to a commercial use requirement”. Bosley Med. Inst., Inc. v. Kremer (9th Cir. 2005). In this case, the record does not support the conclusion that Doe used ABR’s marks in the sale of goods or services. Rather, the record shows that Doe used the marks to criticize and mock the policies and administration of ABR and ABR.

While some of the initial posts referenced a future party, none of those posts contained any references to a particular party or mentioned a date, time, cost, or any other details about a party. The mere reference that Doe was a “party planner” is just one factor to consider. Since ABR’s claims require a demonstration of likelihood of confusion and/or commercial use, the District Court did not err in dismissing ABR’s claim ex officio.

{The ABR appeal also involves several First Amendment considerations worth noting. Even assuming that Doe’s messages were commercial in nature, this Court recognized and adopted the roger test, which protects expressive uses of marks from liability under Lanham law. See Mattel vs. MCA Records, Inc. (9th Cir. 2002). Doe’s Instagram posts appear to be expressive work under roger because the messages communicated messages that mocked the policies and administration of ABR. To the extent that ABR’s appeal attempts to inappropriately use trademark laws to block the expression of negative opinions about the university and its administration, these efforts fail.}

[2.] The District Court did not err in dismissing ABR’s claims of trademark infringement, misrepresentation of origin and unfair competition after finding that there was no likelihood of confusion…. The District Court conducted its likelihood of confusion analysis by examining the full context of Doe’s Instagram posts and specifically assessing some of the Selekcraft factors. The court’s analysis included a review of the surrounding posts, comments and the context in which the posts were posted…. We find that the District Court correctly applied the factors and did not abuse its discretion.

[3.] Similarly, the District Court did not err in declining to apply the original doctrine of confusion of interests, which also requires a finding of likelihood of confusion. Network Automation, Inc. v. Advanced Sys. Concepts, Inc. (9th Cir. 2011)….

[4.] [T]he district court analyzed [false advertising] claim, concluding that a prudent consumer would not be confused or misled by the messages included on Doe’s Instagram. This necessarily includes the post regarding the alleged collaboration with Teva Pharmaceuticals…. Thus, we uphold the district court’s order dismissing ABR’s false advertising claim since the claim also requires a demonstration of deception or likelihood of deception.

[5.] The district court did not err in refusing to rule on ABR’s Arizona state law dilution claim after the court dismissed all claims over which it had jurisdiction initial. Contrary to ABR’s assertion, 28 USC § 1338(b) does not give district courts initial jurisdiction over claims of dilution of state law.

Rather, the law provides “the initial jurisdiction of any civil action asserting an allegation of unfair competition.” 28 USC § 1338(b). The statute provides additional jurisdiction over claims of dilution of state law. Accordingly, the district court properly exercised its discretion in deciding not to exercise additional jurisdiction over the claim for dilution of state law after denying all of the federal claims.

The fact that the district court ruled on ABR’s unfair competition action under state law but did not rule on its claim for dilution under state law State was not an abuse of power. As explained above, under 28 USC § 1338(b), the court had primary jurisdiction over ABR’s unfair competition action and properly resolved that action. A claim for unfair competition and a claim for state dilution are separate. Because the dilution claim required additional analysis, the district court did not err in declining to exercise additional jurisdiction over ABR’s dilution claim.

[6.] The District Court did not err in denying ABR’s motion for default judgment because the claim was unsubstantiated and insufficient.