In mid-February, a coffee shop was opened in Los Angeles called “Dumb Starbucks”. The get-up of the café was very similar to the well-known Starbucks chain, using the same shade of green and décor. Dumb Starbucks also amended the original Starbucks logo and menu, simply by adding the word “Dumb” (see below). One notable difference, however, was that at Dumb Starbucks drinks were free and the establishment presented itself as an art- installation.
Whilst Starbucks are yet to take any legal action, Dumb Starbucks are purporting to rely on the parody exemption under US law, a defence to trade mark infringement that allows parody as a form of “fair use” of a third party mark. The leading case in the US, which has been followed by a number of more recent cases, is the case of Campbell v Acuff-Rose Inc. 510 U.S. 569 (1994). In Campbell, a parody of the renowned “Oh Pretty Woman” song, was found permissible as the parody had a transformative effect on the original, a factor that outweighed other issues such as commercial nature.
In the UK, the area of parody is in flux, with no official parody defence currently available. In relation to trade mark infringement, the most recent case is Ate My Heart Inc v Mind Candy Ltd  EWHC 2741 (Ch), in which Lady Gaga prevented Mind Candy from ‘promoting, advertising, selling, distributing or otherwise making available to the public The Moshi Dance or any musical work or video that purports to be performed by a character by the name of Lady Goo Goo, or that otherwise uses the name Lady Goo Goo or any variant thereon’. This decision was on the basis that there was a real risk that Lady Gaga’s reputation could be diluted and/or tarnished together with an arguable case of unfair advantage. The Judge discussed how there was no parody defence available, and highlighted that even if there was, the Lady Goo Goo character went further than parody and actually aimed to increase the commercial success of Mind Candy. However, the Judge did not go as far as preventing Mind Candy from using the Lady Goo Goo character within the Moshi Monsters game.
In the sphere of copyright, parodies are currently not allowed unless the copyright owner has given permission. Case law, though sparse, has tended to fall in favour of the rights owner (see Twentieth Century Fox Film Corp v Anglo-Amalgamated Film Distributors  109 S.J. 107, in which the defendant was prevented from creating a poster for “Carry on Cleo” based on the claimant’s “Cleopatra” poster). There is, however, an ongoing proposal, following the Hargreaves Review of Intellectual Property and Growth in 2011, that suggests including parody within the “fair dealing” defence for copyright infringement, the definition of which is not clear in itself. It remains to be seen whether this will be implemented, although developments are expected in 2014.
The curious quirk about parody is that whilst the strength of a trade mark typically supports the mark’s owner in infringement and dilution cases, it has the opposite effect in cases involving a parody: the strength of the mark actually makes the parody more successful. However, it is perhaps an opportunity for trade mark owners to gain some positive PR by showing they can laugh with the joke (in appropriate circumstances).
Possibly due to the risk of negative PR for right owners taking action against ‘the little guy’, in an age where ‘trial by social media’ is an increasingly real prospect, parody cases often settle, resulting in a dearth of case law in this area. Dumb Starbucks is currently closed, having been trading without a health and safety certificate. However, it will be interesting to monitor what happens if Dumb Starbucks reopens its doors or launches a UK branch.