Why it matters: Here, we highlight two recent Central District of California rulings on summary judgment that turn on an analysis which balances the conflict between First Amendment protections and intellectual property rights. In Twentieth Century Fox Television v. Empire Distribution Inc., the District Court relied on First Amendment grounds rather than a traditional "consumer confusion" trademark infringement analysis to grant summary judgment in favor of Twentieth Century Fox Television in connection with litigation over its use of "Empire" for the hit television series. In Tierney v. Moschino S.p.A., another District Court agreed with designer Moschino that its fashion line was protected activity under the First Amendment. However, the Court denied Moschino's anti-SLAPP motion because the plaintiff graffiti artist had demonstrated a probability of prevailing in his trademark and copyright infringement lawsuit against Moschino for incorporating the artist's mural into a dress worn by singer Katy Perry to the 2015 Met Gala. Read further for a recap of these recent rulings.

Detailed discussion: This article recaps two recent Central District of California rulings in connection with high-profile intellectual property disputes involving (i) the hit television series "Empire," and (ii) a dress worn by singer Katy Perry to the Met Gala ball in 2015. Both rulings rely upon an analysis that balanced First Amendment free speech concerns with intellectual property rights.

Twentieth Century Fox Television et al. v. Empire Distribution Inc.: On February 1, 2016, Judge Percy Anderson granted summary judgment in favor of Twentieth Century Fox Television ("Fox") in connection with trademark infringement litigation with record label and music publishing company Empire Distribution Inc. ("Empire Distribution") over the use by Fox of "Empire" for its hit television series. In ruling in favor of Fox, Judge Anderson relied on the First Amendment rather than traditional trademark infringement analysis.

To briefly review the facts and procedural history of the case, Fox debuted its hit television series "Empire" on January 7, 2015 ("Empire Series"), which "tells the fictional story of a feuding entertainment industry family" fighting for control over the patriarch's music and entertainment company "Empire Enterprises." As such, music is "heavily featured" in the series, consisting of originally produced compositions that are then compiled onto soundtracks ("Empire Soundtracks") and marketed by Fox and its music partner Columbia Records. Defendant/counter-claimant Empire Distribution is described as "a record label, music distributor and publishing company that was founded in 2010" specializing in "urban, hip hop, and R&B music," which has released "multiple" platinum and gold records for well-known recording artists such as T.I., Snoop Dogg and Kendrick Lamar. The facts show that Empire Distribution uses the trademarks "Empire" and "Empire Recordings," among other derivations, as part of its business, and has trademark applications for the marks currently pending at the U.S. Trademark Office. In mid-2015, Empire Distribution sent Fox a "cease and desist" letter over its use of "Empire," claiming that it caused consumer confusion and assumed affiliation with Empire Distribution. After receipt of the letter, Fox filed suit for declaratory relief in the Central District. Empire Distribution responded by filing counterclaims against Fox for trademark infringement and dilution under the federal Lanham (Trademark) Act ("Lanham Act") as well as various state law claims. Fox moved for summary judgment on all claims, which Judge Anderson granted.

Fox had argued in its motion that summary judgment should be granted on two grounds, namely, (i) its use of "Empire" was protected by the First Amendment, and (ii) Empire Distribution failed to establish that there was a genuine issue of material fact as to consumer confusion under its trademark infringement claims. Judge Anderson stated at the outset that, as he found Fox's First Amendment argument to be compelling, he would not need to address the consumer confusion trademark infringement arguments.

Judge Anderson began his analysis by establishing that, while the "Lanham Act protects the public's right not to be misled as to the source of a product," Ninth Circuit precedent holds that a trademark owner is not allowed "to quash an unauthorized use of the mark by another who is communicating ideas or expressing points of view." Courts must thus interpret the Lanham Act to "'apply to artistic works only where the public interest in avoiding consumer confusion outweighs the public interest in free expression.'" Judge Anderson said that in the controlling 2002 case of Mattel, Inc. v. MCA Records, Inc., the Ninth Circuit adopted the test set forth in the Second Circuit case of Rogers v. Grimaldi to "determine when trademark protection must give way to expressive speech protected by the First Amendment." Under the Rogers test, which Judge Anderson said applies "to uses of a trademarked term in both the title and the body of the work," the use of a trademark in an artistic work that would otherwise violate the Lanham Act is not actionable "'unless the use of the mark has no artistic relevance to the underlying work whatsoever, or, if it has some artistic relevance, unless it explicitly misleads as to the source or the content of the work'." Judge Anderson rejected Empire Distribution's request that he analyze the case in accordance with the traditional "likelihood of confusion" test for trademark infringement found in the 1979 Ninth Circuit case of AMF Inc. v. Sleekcraft Boats, stating unequivocally that the "only relevant legal framework for balancing the public's right to be free from consumer confusion against First Amendment rights is the Rogers test."

Judge Anderson also rejected Empire Distribution's argument that theRogers test can only apply if the mark at issue has obtained a certain level of "cultural significance" to the public, stating that, under Ninth Circuit precedent, "the only threshold for applying the Rogers test is whether the allegedly infringing use is contained in an expressive work." In this case, the Judge found that "[b]oth the Empire Series and the Empire Soundtracks are clearly expressive works, and are therefore entitled to First Amendment protection if they satisfy the Rogers test."

Judge Anderson then applied the two prongs of the Rogers test to the facts of the case. Under the first prong, the use of a mark must be shown to have "artistic relevance to the underlying work," which, in the Ninth Circuit's opinion, requires a "level of relevance merely … above zero." The Judge found that Fox's use of "Empire" met this first test easily, and that even Empire Distribution conceded the point. Judge Anderson then went on to the second prong, which he said "requires a junior user to show that their work does not explicitly mislead as to the source or content of the work." Fox argued that the governing Ninth Circuit test for "explicitly misleading" should be whether there had been an "'explicit indication, overt claim, or explicit misstatement' as to the source of the work," and the Judge agreed. The Judge expressly rejected Empire Distribution's argument that consumer confusion is relevant to this analysis, and found that the second prong of the Rogers test had been met because "Fox has not explicitly misled consumers about its affiliation with Empire Distribution."

The Judge thus granted Fox Television's motion for summary judgment because it found Fox Television's use of "Empire" to be protected by the First Amendment under both prongs of the Rogers test, and that "Empire Distribution's only arguments against summary judgment require the Court to rewrite the Rogers test. The Court declines to do so." Empire Distribution has filed a motion for reconsideration, which is pending as of this writing.

Tierney v. Moschino S.p.A.: On January 13, 2016, Judge Stephen V. Wilson denied the "anti-SLAPP" motion to strike filed by Italian high-end clothing designer Moschino S.p.A. ("Moschino") and its creative director Jeremy Scott ("Scott") (collectively, the "Defendants") and allowed to proceed the trademark and copyright infringement lawsuit filed against them by "world-renowned" graffiti artist Joseph Tierney, a.k.a. "RIME" ("Tierney"). Tierney had filed his complaint in 2015 in connection with the unauthorized reproduction by the Defendants of Tierney's 2012 mural "Vandal Eyes" (painted on the side of a building in Detroit) and his tag "RIME" onto numerous dresses they designed for their 2015 Fall/Winter collection, one of which was worn by singer Katy Perry to the 2015 Met Gala ball. Tierney alleged in his complaint that "[f]ollowing the Met Gala, the Defendants' collection bearing Tierney's graffiti garnered immense publicity through various news and pop culture channels (e.g., the New York Times, CNN, Vogue, Vanity Fair, People, Us Weekly) and was viewed extensively on social media." As a result of this publicity surrounding the dress, Tierney alleged that the Defendants enjoyed "increased revenues" at the expense of Tierney's "street cred" and reputation in the art world.

After denying the separate motions to dismiss brought by Moschino and Scott because he found that Tierney had successfully pled causes of action for trademark and copyright infringement, as well as various state law claims (right of publicity, unfair competition, etc.), Judge Wilson turned to the motion to strike filed by the Defendants under California's Strategic Lawsuit Against Public Participation ("anti-SLAPP") statute, which was enacted to allow pretrial dismissal of strategic litigation aimed primarily at chilling the exercise of First Amendment rights.

Judge Wilson began by reviewing the "two-part inquiry" that must be made in order for the Defendants' anti-SLAPP motion to succeed: "First, Defendants must make a threshold showing that the challenged causes of action arise from protected activity. If this showing is made, then the burden shifts to Tierney to demonstrate a probability of prevailing on the contested claims." Judge Wilson found that the Defendants satisfied the "low threshold showing" under the first part of this inquiry because their fashion line constituted creative activity and speech "intended to convey a message" in the public interest and was thus protected by the First Amendment. Judge Wilson pointed out that, although the Defendants could not cite to any specific case law precedent finding that fashion is a "creative activity" protected under the anti-SLAPP statute, California courts have broadly construed what constitutes creative work for these purposes and "fashion has been acknowledged as a form of First Amendment activity in other contexts." Judge Wilson further found that Defendants' fashion line was an issue of public interest because "Jeremy Scott and Moschino are household names in high fashion."

Judge Wilson next turned to the second part of the inquiry, whether Tierney sufficiently demonstrated a probability of success on the merits of his state law claims that would outweigh the Defendants' First Amendment rights in this instance. The Judge found that Tierney had done so, and denied the Defendants' anti-SLAPP motion. The Judge noted that, not only had he previously denied the Defendants' motions to dismiss because he found that Tierney had adequately pled the causes of action in his complaint, but "at this early stage of the case … the Court cannot find as a matter of law that Defendants' use of 'RIME' was not explicitly misleading or would not lead to a likelihood of confusion."

See here to read the 2/1/16 order in Twentieth Century Fox Television et al. v. Empire Distribution Inc.

See here to read the 1/13/16 order in Tierney v. Moschino S.p.A.