Kelly-Brown v. Winfrey
By Alex Shank – Edited by Samantha Rothberg
Kelly-Brown v. Winfrey, No. 12-1207 (2nd Cir. May 31, 2013)
The U.S. Court of Appeals for the Second Circuit vacated the District Court for the Southern District of New York’s (S.D.N.Y.) dismissal of trademark infringement claims against Oprah Winfrey, rejecting her fair use defense. Kelly-Brown alleged that Winfrey had used her trademarked phrase “Own Your Power” “as a mark” on the cover of O, The Oprah Magazine, its website, and at a magazine event.
Bloomberg summarizes the case and provides comments from Harpo, Inc. and Hearst Corp., two of Winfrey’s media enterprises. Reuters reports that Kelly-Brown was “ecstatic” about the result. JDSupra praised the court’s recognition of Kelly-Brown’s trademark as a “concept,” while Rebecca Tushnet critiqued the Second Circuit’s further confusing the meaning of “descriptive use.”
Simone Kelly-Brown owns a motivational services business and a registered trademark in the phrase “Own Your Power.” Kelly-Brown, slip op. at 2. While Kelly-Brown was registering “Own Your Power,” Oprah and Harpo, Inc. (“Harpo”) sought to register a trademark in “OWN” for the Oprah Winfrey Network. Id. at 4. In 2010, Oprah Magazine prominently featured the words “Own Your Power” on its front cover, placed “Own Your Power” banners on its website, and held an “Own Your Power” event, pictures of which were posted on the magazine website and Facebook page. Id. at 4–7. Kelly-Brown sued Winfrey in the District Court for the District of New Jersey for trademark counterfeiting, trademark infringement, reverse confusion, and false designation of origin under the Lanham Act, as well as for various state law claims. Kelly-Brown also sued sponsors of the “Own Your Power” event for secondary trademark infringement and counterfeiting. Id. at 2. The case was transferred to the S.D.N.Y, which found Winfrey’s conduct to constitute “fair use” and dismissed all of Kelly-Brown’s claims. Kelly-Brown appealed. Id. at 1.
The Second Circuit vacated the dismissals based on fair use. Id. According to the court, Kelly-Brown’s complaint alleged enough facts to support her entitlement to relief from trademark infringement and to rebut Winfrey’s fair use defense. To prove fair use, a defendant must show that the use was made “(1) other than as a mark, (2) in a descriptive sense, and (3) in good faith.” Id. at 8 (quoting JA Apparel Corp. v. Abboud, 568 F.3d 390, 400 (2d Cir. 2009)). Although the Second Circuit recognized that the Sixth Circuit holds use “as a mark” as a threshold requirement, it rejected the defendants’ contention that the same standard applies in its jurisdiction. Id. at 14–15. The court then found that Winfrey’s use of “Own Your Power” was “as a mark” because Winfrey used the phrase “as a symbol to attract public attention.” Id. at 17–18 (quoting JA Apparel Corp, 568 F.3d at 400). The publicity of “Own Your Power” arising from the event, magazine cover, and website banners plausibly showed a “pattern of use” attempting to draw an association between Winfrey and the phrase. Id. at 18, 20. The court also held that Winfrey’s use was not descriptive, since the “Own Your Power” magazine did not “provide advice regarding how a reader can become more powerful in general.” Id. at 24. Finally, because Kelly-Brown’s complaint allowed a plausible inference that Winfrey knew of the “Own Your Power” mark from her trademark search for “OWN,” the Second Circuit held as erroneous the district court’s determination of Winfrey’s good faith. Id. at 25–26. In addition to vacating the lower court holding with respect to fair use, the Second Circuit reinstated Kelly-Brown’s state law claims, affirmed the dismissals of Kelly-Brown’s secondary infringement and counterfeiting claims, and denied consideration of Winfrey’s First Amendment arguments. Id. at 26–29.
Judge Sack concurred, cautioning against “[a]llowing a person or entity’s property right arbitrarily to trump the ability of an initiator of a communication effectively to transmit news, information, [and] thoughts. . . .” Id. at 31. Citing The Birdcage, Judge Sack concluded that Winfrey’s use of “own” in “Own Your Power” “fits easily” among the descriptive uses of the word. Id. at 35, 41. Had the court considered the October 2010 issue of Oprah Magazine alone, Judge Sack would have found fair use. Id. at 46. However, since Kelly-Brown’s complaint plausibly attacked Oprah’s use as “part of an overall campaign . . . to wrest from the plaintiffs their rights in the mark,” Judge Sack found a dismissal at this stage improper. Id.
The “little guys” in entertainment, fashion, and other industries may take heart in the court’s holding. The majority’s reasoning clearly disfavors well-known defendants arguing that there is good faith when they “prominently displayed [their] own marks in a way that overshadows the plaintiff’s mark” when they had constructive knowledge of the plaintiff’s mark, at least in early litigation. Id. at 25 (citing Cosmetically Sealed Indus., Inc. v. Chesebrough-Pond’s USA Co., 125 F.3d 28, 30–31 (2d Cir. 1997)). The opinion’s emphasis on the incoherence between the Second and Sixth Circuits’ tests regarding the likelihood of consumer confusion and whether use “as a mark” serves as a threshold requirement raises the possibility of the Supreme Court later taking a case to resolve the circuit splits in trademark law.