In The Pennsylvania State University v. Vintage Brand, LLC, 2022 U.S.P.Q.2d 653 (M.D. Pa. 2022 The Pennsylvania State University (“Penn State”) sued Vintage Brand, LLC (“Vintage”), an online retailer of screen-printed goods featuring logos and images, for violations of federal and state trademark and unfair competition laws. Penn State seeks to restrain Vintage from selling goods displaying logos associated with Penn State. Vintage admits using the Penn State logos but contends that the logos are in the public domain and not subject to trademark protection. Vintage has asserted multiple counterclaims including one seeking to cancel three Penn State trademark registrations on the grounds that the registered marks are ornamental and fail to function as trademarks. Vintage contends that these trademarks, shown here, are “used as mere decoration, printed in large font and in a prominent location, and [do] not serve to identify Penn State as the source or origin of the goods”:
Penn State moved to dismiss Vintage’s counterclaims for failure to state a claim under Fed. R. Civ. P. 12(b)(6) because, as a matter of law, the marks are not ornamental because they are associated with Penn State. The Court denied the motion in an opinion detailing the approaches taken by the TTAB and various circuits in deciding whether a mark is ornamental and rejecting the association standard advocated by Penn State.
Under the Lanham Act, a trademark can be obtained for “any word, name symbol, or device, or any combination thereof . . . used by a person . . . to identify and distinguish his or her goods . . . .” 15 U.S.C. § 1127. When a trademark fails to fulfill this purpose, it is subject to cancellation. According to the Court, a registration is considered ornamental when its overall commercial impression is solely as attractive ornamentation and does not also serve as a symbol that identifies and distinguishes the source of the goods on which it is placed.
In determining whether trademarks are merely ornamental, the Court stated that it must consider the symbol’s size, location, and dominance and whether it is accompanied by a “TM” or ®. On the non-ornamental end of the continuum are small symbols on the tag of a shirt or stamped on the bottom of a mug. On the ornamental end of the continuum are large, dominant, and centrally located symbols, such as shirts with text emblazoned across the chest. Courts must also consider whether the trademarks identify and distinguish the source of the goods, which invokes the fundamental question at issue in this case: does the trademark identify the source of the goods on which it is placed or does it merely create an association between the trademark and the trademark holder?
Vintage argued that consumers believe that the essence of the Penn State logo marks when placed on various goods is to signal the consumer’s support for Penn State and not that consumers believe Penn State produced, approved, or guaranteed the quality of the goods. In Vintage’s view, use of the Penn State logo marks on goods, such as T-shirts, does not identify and distinguish Penn State as the source of the goods, which is required under traditional principles of trademark protection. Penn State, on the other hand, argued that it is unimaginable that consumers would perceive use of the Penn State logos on goods as anything other than an identification of Penn State as the source or second source of the goods.
This debate has long been an issue in trademark law, and decades-old caselaw left the issue undecided. In obtaining trademarks for university logos and bringing infringement actions, Penn State and, more generally, the modern collegiate trademark and licensing regime rely on prior caselaw holding that university logos inherently indicate that the university is the source or sponsor of the goods, and there is no need to inquire whether consumers believe that the trademark holder manufactured or sponsored the product. However, the Court in this case held that this reasoning steps away from the traditional protections afforded by trademark law and held that the proper analysis in determining whether the use of a university logo functions as a trademark is not whether consumers tie the symbol or logo to the trademark holder, but whether they tie the product on which the logo is placed to the trademark holder.
Accordingly, the Court denied Penn State’s motion to dismiss and allowed Vintage to proceed with its counterclaims that Penn State’s trademark registrations for its logos are merely ornamental. In closing the Court recognized that the modern collegiate and trademark licensing regime has grown into a multi-billion dollar industry, but that “the house is large is of little matter if it’s been built on sand.”