New York Times bestseller, A-list celebrity, coffee entrepreneur and meme legend Grumpy Cat sadly passed away a couple of weeks ago.
Grumpy Cat (aka Tardar Sauce) was the star of one of the first memes to ever take over the Internet and her owners went on to transform the cat’s online fame into a million-dollar brand. As a result, the life of Grumpy Cat provides us with some important legal lessons in how to monetise and defend a brand, which could prove to be useful for businesses, pet influencers and meme megastars alike.
Would you like any sauce with that?
Tardar Sauce was born in 2012 with feline dwarfism and an underbite, which caused her to have a permanently angry-looking grimace. When Bryan Bundesen, the brother of Tardar’s owner Tabatha Bundesen, posted a photograph of the miffed moggy on Reddit, Grumpy Cat was born.
Over the next few years, Grumpy Cat evolved from being the source of countless internet memes to a real-life A-list celebrity; she has starred in her own film, ‘authored’ her own book and sold thousands of pieces of merchandise. By August 2018 there were eight trademarks associated with Grumpy Cat registered at the US Patent and Trademark Office and the cat’s website sold 1,082 different feline-related products.
As Cowan Liebowtiz & Latman highlighted earlier this year, the registered trademark and copyrights linked to Grumpy Cat have been licensed for a plethora of products, including “shirts, mugs, books, pens, bags, socks, plush toys, slippers, cushions, phone cases, balloons, stickers, calendars, dinner plates, candy, towels and key rings”. Similarly, Marks & Clerk have emphasised the fact that the story of Grumpy Cat represents a “cautionary tail” for IP owners, business and licensees to take care when it comes to recognising the scope of licensing agreements.
Back in 2013, as Loeb & Loeb explained, through the company Grumpy Cat Limited, Tardar’s owners cannily began to license the Grumpy Cat trademark and protected content to companies and brands looking to exploit the cat’s internet fame. One licence agreement was confirmed with Grenade Beverages LLC to use Grumpy Cat IP rights in a “line of Grumpy Cat-branded coffee products”.
Grumpy Cat Limited v Grenade Beverages LLC
However, as Marks and Clerk reported at the time, instead of using the Grumpy Cat brand only on the ‘Grumpy Cat Grumppuccino’ as had been agreed through the licence agreement, Grenade launched lines of coffee and T-shirts using the brand despite being refused permission to do so by Grumpy Cat Limited. As our WTR colleagues highlighted, Tardar’s owner, Bundesden took Grenade to court in California in 2015 and went on to secure a $710,000 damages award. The company also sought to have the ‘grumpycat.com’ domain name transferred to it under the Anti-cybersquatting Consumer Protection Act, as reported by King & Wood Mallesons. The judgment set an important precedent for online brands and internet celebrities, as Bundesden’s counsel David B Jonelis stated, the ruling proved that “memes have rights too”.
Novagraaf pointed out that the victory over Grenade demonstrated how working hard to secure and thoroughly protect IP rights is worthwhile for nascent brands and stressed that “any business that thinks it has an idea worth bringing to market should protect its IP rights as if it were already generating revenue” and this is exactly how Grumpy Cat’s owners ultimately managed to make millions out of nothing.
However, Grumpy Cat’s foray into the legal world was not all about success. Late in 2018, the limit of the cat’s IP registrability was reached when the Trademark Trial and Appeal Board refused to register the Grumpy Cat image as a trademark for videos, games, paper goods, stuffed toys and a website, judging that it was merely descriptive, as reported by Cowan Liebowitz and Latman PC. Despite that fact that the board refused to register the mark for the above goods and services, the cat’s image is protected through valid image registrations under other classes.
Notwithstanding this minor setback, the success of the Grumpy Cat brand is undeniable, and although there has been some speculation over the net worth of Grumpy Cat and how much income she has made for her owners, Forbes recently claimed that the cat was worth anywhere between $1 million and $100 million. Whether this is accurate does not really matter; her owners successfully turned their beloved pet into a global sensation and as a result quit their day jobs to focus on building the Grumpy Cat empire.
When Grumpy Cat passed away as a result of complications during a urinary tract infection, her owners must have been understandably devastated. However, this sense of loss would have been exacerbated by the fact that ordinary life insurance for pets is not designed with famous animals in mind, especially ones that have a net worth of up to $100 million, as pointed out by Market Watch this week.
So, the Internet waits for its next animal superstar, although it is unlikely that the next one to come along will reach the giddy heights of fame as Grumpy Cat. Regardless, the famous feline has taught us some interesting legal lessons about how to go about protecting brands and intangible assets in the online domain, while also highlighting some of the shortcomings in existing legal branding practices.
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