Former Chicago Bulls player Michael Jordan, arguably “the greatest basketball player of all time,” was inducted into the Basketball Hall of Fame on September 11, 2009. Time, Inc., publisher of Sports Illustrated, produced a special edition to celebrate Jordan’s career, available only in stores. It was offered for sale from October 2009 – January 2010.

A Time sales representative offered Jewel Food Stores, Inc. free advertising space in that special issue for stocking the magazine in its stores. Jewel’s full-page color advertisement ran on the inside back cover of the magazine. The ad congratulated Jordan on his accomplishments, displayed a large pair of basketball shoes with Jordan’s number “23,” and prominently  featured the  Jewel-Osco registered logo and tagline “Good things are just around the corner.” The ad text also contained a reference to Jordan as having been “just around the corner” in Chicago for many years. Jordan sued Jewel for trademark, right of publicity, deceptive trade practices, and unfair competition violations. The magazine also contained a full-page congratulatory ad by Jewel’s Chicago rival, Dominick’s Finer Foods, who Jordan sued in a pending separate action.

The U.S. District Court for the Northern District of Illinois dismissed the case, finding that Jewel’s ad was noncommercial speech protected under the First Amendment to the U.S. Constitution and that the constitutional immunity applied to the entire case. Jordan appealed on the basis that the ad was unprotected commercial speech. The parties agreed that the court could not apply the federal and state claims in the complaint if the ad constituted noncommercial speech under the First Amendment.

The U.S. Court of Appeals for the Seventh Circuit reversed the dismissal, finding that the ad was “garden variety” commercial speech, a form of image advertising aimed at promoting the Jewel-Osco brand. The Seventh Circuit noted that Jordan is a “sports icon whose name and image are deeply embedded in the popular culture and easily recognized around the world,” a desirable celebrity endorser who closely guards the use of his identity. It observed that the Supreme Court has mainly adopted the commercial speech doctrine in cases involving public law entities, such as municipalities, public universities, the Postal Service, state utilities, and the like. However, the Supreme Court has not resolved the conflict between intellectual property rights and free speech rights in cases between private parties, and the lower courts have applied a conflicting mix of tests. Because of the parties’ agreement, the Seventh Circuit did not decide that issue.

The Seventh Circuit noted that commercial speech can be constitutionally  protected  but  that  governmental  burdens  on such speech are scrutinized more leniently than on fully protected noncommercial speech. Commercial speech is defined by the Supreme Court as “speech that proposes a commercial transaction,” but that definition is merely a starting point for analysis. Other communications that contain discussions of important public issues might also constitute commercial speech, such as ads that link a product to a current public debate. Courts must give effect to the common  sense  distinction noncommercial speech, because there was “no law of man or nature” that compelled Jewel to combine the noncommercial and commercial messages as it did. The Seventh Circuit remanded the case to the District Court to determine if Jordan could provide proof that the ad caused a likelihood of confusion that Jordan sponsored or endorsed Jewel’s products and services. In ruling that the Jewel ad was commercial speech, the Seventh Circuit gave Jordan the assist he needed to pursue his lawsuit in the district court. Winning the between commercial and other forms of speech. Where a communication contains both noncommercial and commercial elements, likelihood of confusion claim, however, will not be a slam-dunk. Jordan has the burden of proof that  the  inclusion  of  the relevant considerations include whether (1) the speech is an advertisement, (2) the speech refers to a specific product, and (3) the speaker has an economic motivation for the speech. No one factor is sufficient and all factors need not be present.

The Seventh Circuit found the ad to be commercial speech despite not proposing a commercial transaction but rather a congratulatory salute to Jordan.The literal meaning of the words in the ad is not all that matters because commercial advertising is highly creative, is often supported by sophisticated marketing research, and frequently relies on subtle cues. An ad can be commercial if it promotes brand awareness or loyalty, with a commercial message that is general and implicit rather than specific and explicit. Although Jewel’s ad both congratulates Jordan and promotes Jewel’s supermarkets, the Seventh Circuit concluded that its unmistakable commercial function of enhancing the Jewel- Osco brand in consumers’ minds was easily inferred and the dominant message. Unlike an ad congratulating a local community group, an ad congratulating a famous athlete can only be understood as a promotional device for the advertiser, allowing the advertiser to benefit from the commercial value of the celebrity’s identity.

The logo, observed the court, is prominently featured in a bold red style in the center of the page, in a font larger than any other on the page. It draws attention to Jewel- Osco’s  sponsorship  of the tribute. Also, the text contains Jewel’s tagline. Jewel intended the ad to foster goodwill among Chicagoans and Jordan’s fans to increase patronage at Jewel- Osco’s stores. Although the ad does not contain any text about Jewel’s products, product-specific art, or photography, the Seventh Circuit concluded that Jewel’s “image” or brand advertising invited readers to patronize their local Jewel store. The ad promoted brand loyalty rather than a specific product but was nevertheless commercial. Even Jewel’s copywriter thought that the ad was “too selly” and “hitting too much over the head.”The Seventh Circuit determined that the ad was a form of image advertising aimed at promoting goodwill for the Jewel- Osco brand by “exploiting public affection for Jordan at an auspicious moment in his career.”It was not an article, column, news photograph, or illustration, but an advertisement serving a commercial purpose.

The Seventh Circuit concluded that Jewel’s ad was like television ads by corporate sponsors for Olympic athletes, which couple the advertiser’s logo or brand name with images of the athletes and expressions of support for the U.S. Olympic team. An outright sales pitch is not required. In addition, the Seventh Circuit observed that the noncommercial and commercial messages were not inextricably intertwined,  which  would  afford  the  ad  the  higher  standard  of noncommercial speech, because there was “no law of man or nature” that compelled Jewel to combine the noncommercial and commercial messages as it did. The Seventh Circuit remanded the case to the District Court to determine if Jordan could provide proof that the ad caused a likelihood of confusion that Jordan sponsored or endorsed Jewel’s products and services.

In ruling that the Jewel ad was commercial speech, the Seventh Circuit gave Jordan the assist he needed to pursue his lawsuit in the district court. Winning the likelihood of confusion claim, however, will not be a slam-dunk. Jordan has the burden of proof that the inclusion of the Jewel logo and tagline in a one-time message congratulating him on his induction to the Basketball Hall of Fame caused a likelihood of confusion that he was a Jewel sponsor and/or endorsed its products. Ultimately, the district court will decide whether Jordan is practicing sound brand management or is out of bounds.

Source: Michael Jordan v. Jewel Food Stores, Inc., No. 12-1992, U.S. Court of Appeals for the Seventh Circuit, February 19, 2014