The Pennsylvania State University v. Vintage Brand, LLC

IN THE UNITED STATES DISTRICT COURT

FOR THE MIDDLE DISTRICT OF PENNSYLVANIA

THE PENNSYLVANIA STATE No. 4:21-CV-01091

UNIVERSITY,

(Chief Judge Brann)

Plaintiff,

v.

VINTAGE BRAND, LLC,

Defendant.

MEMORANDUM OPINION

JULY 14, 2022

In June 2021, The Pennsylvania State University sued Vintage Brand, LLC,

an online retailer of goods bearing screen-printed, and often retro, logos and images.

Penn State contends that this practice violates federal and state trademark and unfair

competition laws. Vintage Brand, however, denies these charges and asserts four

counterclaims attacking the validity of Penn State’s marks—emphasizing that while

it sold goods with Penn State’s marks, these images and logos are in the public

domain and not subject to further protection under trademark law. Penn State now

seeks to dismiss Vintage Brand’s fourth counterclaim, where the Company contends

that three of the University’s marks should be canceled because they are ornamental

and fail to function as trademarks.

While this case touches on broad and substantial questions about collegiate

merchandising rights under trademark and unfair competition law, the fate of Penn

State’s motion turns on a far narrower question: Under the Lanham Act, does a

symbol identify the source of the goods if it merely creates an association between

it and the trademark holder?

Because the Court finds that it does not, Penn State’s motion to dismiss is

denied.

I. FACTS ALLEGED IN THE COMPLAINT

For today’s motion, the Court need not delve deeper than the allegations about

the three marks.1 First among them is the University’s 1984 registration of the text

“Penn State.”2 The University holds this registration across a host of goods,

including everything from apparel, banners, and flasks to USB flash drives, manual

toothbrushes, and salt and pepper shakers.3 Second is the image of the so-called

“Pozniak Lion,”4 which Vintage Brand contends was used as a school logo until it

was phased out in 1987.5 Penn State registered this mark in 2017 for use on metal

novelty license plates and apparel.6 And third is the image of the Penn State seal.7

Similarly registered in 2017, this mark—which displays the Pennsylvania Coat of

1 See Doc. 31 ¶¶ 39–48.

2 U.S. Federal Registration No. 5,766,698.

3 Doc. 23 ¶ 17; Doc. 39 at 3–4.

4 U.S. Federal Registration No. 5,305,910.

5 Doc. 31 ¶¶ 16, 17, 19.

6 Id.

Arms ringed by the University’s name and date of founding—covers various apparel

and drink-related goods, such as decanters, coasters, and ceramic mugs.8

For each, Vintage Brand alleges the same deficiencies. The Company pleads

that they 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”; that “[o]n information and belief, consumers perceive . . . [the marks] to be

merely a decorative feature of the goods and not an indication of the source of the

goods”; and finally that their “overall commercial impression . . . is purely

ornamental or merely a decorative feature[,] . . . [and they] do not identify and

distinguish Penn State’s goods from those of others and, therefore, do not function

as a trademark . . . .”9

II. LEGAL STANDARD

Under Federal Rule of Civil Procedure 12(b)(6), the Court may dismiss a

complaint, in whole or in part, if the plaintiff has failed to “state a claim upon which

relief can be granted.” Following the landmark decisions Bell Atlantic Corp. v.

Twombly10 and Ashcroft v. Iqbal,11 “[t]o survive a motion to dismiss, a complaint

must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that

8 Doc. 31 ¶¶ 11, 12; Doc. 39 at 4.

9 Doc. 31 ¶¶ 39–48.

10 550 U.S. 544 (2007).

is plausible on its face.’”12 In its assessment, the Court must “accept as true all factual

allegations in the complaint and draw all inferences from the facts alleged in the light

most favorable to [the plaintiff].”13 Still, “the tenet that a court must accept as true

all of the allegations contained in the complaint is inapplicable to legal

conclusions.”14 “Threadbare recitals of the elements of a cause of action, supported

by mere conclusory statements, do not suffice.”15

III. ANALYSIS

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 . . . .”16 When a trademark fails to fulfill this

purpose, it is subject to cancellation.17 Because Penn State has registered these three

marks with the United States Patent and Trademark Office Vintage Brand must show

that they are invalid.18

12 Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S.

544, 570 (2007)).

13 Phillips v. Cnty. of Allegheny, 515 F.3d 224, 228 (3d Cir. 2008) (Nygaard, J.).

14 Iqbal, 556 U.S. at 678; see also Fowler v. UPMC Shadyside, 578 F.3d 203, 210 (3d Cir. 2009)

(Nygaard, J.) (“After Iqbal, it is clear that conclusory or ‘bare-bones’ allegations will no

longer survive a motion to dismiss.”).

15 Iqbal, 556 U.S. at 678.

16 15 U.S.C. § 1127.

17 Given the parties’ focus on merchandise-related registration categories, I assume that Vintage

Brand’s ornamentality challenge is “as applied,” and thus an effort to deny protection in these

narrow categories, rather than an effort to cancel the marks as a whole. See also Int’l Order

of Job’s Daughters v. Lindeburg & Co., 633 F.2d 912, 918–20 (9th Cir. 1980) (considering

an as-applied functionality defense to a trademark-infringement claim).

18 15 U.S.C. § 1057(b) (“A certificate of registration of a mark upon the principal register

provided by this chapter shall be prima facie evidence of the validity of the registered mark

and of the registration of the mark, of the owner’s ownership of the mark, and of the owner’s

Vintage Brand attempts to do so here through an ornamentality challenge. A

registration fails on this ground when its overall commercial impression is “solely

as attractive ornamentation” and not “also as a symbol that identifies and

distinguishes a single source.”19 In assessing aesthetic ornamentation, the first half

of this conjunctive requirement, courts have considered the symbol’s “size,

location[,] and dominance,” and whether it is accompanied by a ™ or ®.20 Sitting at

the non-ornamental end of this continuum are the small symbols affixed to the tag

of a shirt or stamped on the bottom of a mug. While on the ornamental side stand the

large, dominant, and centrally located symbols, such as shirts with text emblazoned

across the chest or a coaster with a mascot featured across the top. By both allegation

and appearance, Penn State’s marks fall into the latter.21

But this finding does not settle the matter. The ornamentality requirement is

conjunctive; that “a design is pleasing to the eye and serves a decorative purpose

services specified in the certificate, subject to any conditions or limitations stated in the

certificate.”).

19 J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition § 7:81 (5th ed., June

2022) (McCarthy on Trademarks and Unfair Competition); see Macy’s Inc. v. Strategic

Marks, LLC, 2016 WL 374147, at *3 (N.D. Cal. Feb. 1, 2016); Bobosky v. Adidas AG, 843 F.

Supp. 2d 1134, 1145 (D. Or. 2011). For the purposes of today’s motion. I have proceeded

using the standard described in McCarthy on Trademarks and Unfair Competition. I will note,

however, that Vintage Brand contends that the seemingly more lenient Third Circuit standard

for trade dress claims should be imported instead. Doc. 39 at 8 (quoting Duraco Prods., Inc.

v. Joy Plastic Enterps., Ltd., 40 F.3d 1431, 1449–50 (3d Cir. 1994)) (“[T]he configuration for

which protection is sough must not appear to the consumer as a mere component, or the

essence, of the product gestalt, but rather must appear as something attached (in a conceptual

sense) to function in actuality as a source designator—it must appear to the consumer to act

as an independent signifier of origin rather than as a component of the good.”).

20 Bobosky, 843 F. Supp. 2d at 1145.

does not mean that the design cannot also serve a trademark purpose.”22 The Court

must also consider whether the marks “identify and distinguish” the goods. This

requirement, which invokes the Lanham Act’s definition of a trademark, broadens

the analysis to the fundamental trademark question: does the mark serve a source

identifying function?23 And here, the parties’ understanding of the law diverges.

Vintage Brand contends that consumers believe that the essence of these

marks is to signal their support for the University, not that the University has

produced, approved, or guaranteed the quality of the item.24 So in its view, the marks

do not “identify and distinguish” Penn State as the source of the goods. Penn State,

on the other hand, contends that “it would be unimaginable that using PENN

STATE, the University, or the Pozniak Lion Logo on a good, no matter how

prominently, could be perceived by the consuming public as anything other than an

identification of Penn State as the source or second source of the good.”25 These

arguments are nothing new. They have been raised across a host of decisions that

assess whether a symbol is eligible for trademark protection to begin with (the so-

called “eligibility” cases) or whether another entity’s use of a trademark symbol

22 McCarthy on Trademarks and Unfair Competition § 7:24.

23 Id. § 7:81 (“The ‘merely ornamental’ rule is simply a facet of the basic trademark factual

question: is the disputed feature in fact perceived by customers as a trademark or not?”).

24 Doc. 39 at 10–14.

25 Doc. 38 at 12 (internal alternations, emphasis, and quotations omitted); see also id. at 15

(“common sense dictates that the consumers of university-branded apparel would readily

understand that a university’s name, seal, and mascots (like the Accused Marks here) are

constitutes infringement (the so-called “infringement” cases).26 And while these

cases’ terminologies and postures vary, they center on a common question: should

trademark holders—particularly those in the business of education, research, and

New Year’s Six appearances—have an exclusive right to control merchandise

bearing their marks when consumers are purchasing the products not for their

guaranteed quality, but to signal their support for or affiliation with the trademark

holder?

Perhaps it should come as no surprise that our modern trademark regime has

struggled with this question. Trademark law has traditionally served to promote

competitive markets.27 Indeed, protecting marks “enable[s] sellers to develop

26 Determining whether distinct tests interlock or pass by one another can pose difficulties. But

here, where Vintage Brand is using the exact trademarked symbols in a market that Penn State

is also engaged in, there appears to be little difference between the cases undertaking an

infringement analysis (through the likelihood of confusion) and an eligibility analysis

(whether the mark identifies the source of the goods). Indeed, the cross-pollination of these

cases appears to be common practice. E.g., Univ. Book Store v. Bd. of Regents of the Univ. of

Wisconsin Sys., 33 U.S.P.Q. 1385, 1994 WL 747886, at *22 (Trademark Tr. & App. Bd. June

22, 1994) (citing Boston Pro. Hockey Ass’n v. Dallas Cap & Emblem Mfg., 510 F.2d 1004

(5th Cir. 1975)) and In re Olin Corp., 181 U.S.P.Q. 182, 1973 WL 19761, at *1–2 (Trademark

Tr. & App. Bd. Nov. 19, 1973). It’s also worth noting the obvious: no court can find

infringement for a plaintiff on a Rule 12 motion. Still, infringement claims are generally

considered using a multifactor fact-intensive inquiry. E.g., A & H Sportswear, Inc. v.

Victoria’s Secret Stores, Inc., 237 F.3d 198, 215 (3d Cir. 2000) (delineating 10 likelihood of

confusion factors). But if a court weighing similar facts in the infringement context disposes

of the traditional inquiry and enters an automatic finding of likely confusion, e.g., Boston Pro.

Hockey Ass’n v. Dallas Cap & Emblem Mfg. Inc., 510 F.2d 1004, 1012 (5th Cir. 1975), it

suggests that the issue, in the eligibility context, could be disposed of on the pleadings, as any

claim that there’s no source identification would be rendered implausible.

27 Park ‘N Fly, Inc. v. Dollar Park and Fly, Inc., 469 U.S. 189, 198 (1985) (noting that Congress

found “National protection of trademarks . . . desirable . . . because trademarks foster

competition and the maintenance of quality by securing to the producer the benefits of good

reputations for quality,” while also “assur[ing] customers that products sold under

the seller’s brand will live up to that reputation.”28 Up until the mid-20th century,

the law focused narrowly on preventing sellers from using similar marks to “pass

off” their goods as those made by another.29 Over time, however, the law has come

to include more instances when a consumer may be confused about a good’s

source.30 Owing to expansion, trademark protection is no longer limited to mere

word marks; logos, packaging, and even the shape of products may now be

protected.31 Nor is it limited to directly competing products; under current law,

trademark holders can protect against the use of similar marks outside of their core

business provided consumers would presume some form of affiliation or

sponsorship.32

Entities’ efforts to control the use of their marks on merchandise beginning in

the 1970s represented yet another attempt to expand the protections provided to

sellers under the law. For universities, this trademark use diverged from traditional

areas of trademark protection, such as Penn State preventing an unaffiliated

28 Stacey L. Dogan & Mark A. Lemley, The Merchandising Right: Fragile Theory or Fait

Accompli, 54 Emory L.J. 461, 466 (2005) (Dogan & Lemley); see, e.g., Park ‘N Fly, Inc., 469

U.S. at 198 (“The Lanham Act provides national protection of trademarks in order to secure

to the owner of the mark the goodwill of his business and to protect the ability of consumers

to distinguish among competing producers.”).

29 Dogan & Lemley, at 466; see, e.g., S.C. Johnson & Son v. Johnson, 116 F.2d 427, 429 (2d

Cir. 1940) (Hand, J.) (“We are nearly sure to go astray in any phase of the whole subject [of

trademark law], as soon as we lose sight of the underlying principle that the wrong involved

is diverting trade from the first deal with him.”).

30 Dogan & Lemley, at 469.

31 Id.

educational institution from using its name. In this hypothetical, a consumer might

reasonably believe that they are enrolling in a Penn State affiliate. But university-

trademarked apparel and merchandise present a different case; the mark itself is the

product.

From the outset views diverged on whether, given this overriding non-

trademark function, the marks still identified the entity as the source or sponsor of

the goods. Some, notably the United States Court of Appeals for the Fifth Circuit in

Boston Professional Hockey Ass’n v. Dallas Cap & Emblem Manufacturing (Boston

Hockey)33 and the Trademark Trial and Appeals Board in In re Olin Corp.,34 found

that the marks inherently do.35 The Fifth Circuit drew this conclusion from the fact

that consumers only purchase the merchandise because of the mental association it

33 510 F.2d 1004, 1011–12 (5th Cir. 1975), cert. denied, 423 U.S. 868 (1975).

34 1973 WL 19761.

35 See also Univ. Book Store, 1994 WL 747886, at *21–22. While couched in a broader fact-

intensive discussion of consumers’ likelihood of confusion, in Univ. of Georgia Athletic Ass’n

v. Laite, 756 F.2d 1535, 1545–47 (11th Cir. 1985), the court emphasized that “‘confusion’

need not relate to the origin of the challenged product. Rather, ‘confusion’ may relate to the

public’s knowledge that the trademark, which is ‘the triggering mechanism’ for the sale of

the product, originates with the plaintiff.” Id. at 1546 (citing Boston Professional Hockey

Ass’n, 510 F.2d at 1012). I find this description of the law difficult to square with Kentucky

Fried Chicken Corp. v. Diversified Packaging Corp., 549 F.2d 368, 388 (5th Cir. 1977),

Supreme Assembly, Order of Rainbow for Girls v. J.H. Ray Jewelry Co., 676 F.2d 1079, 1082

(5th Cir. 1982), and Savannah Coll. of Art and Design, Inc. v. Sportswear, Inc., 872 F.3d

1256, 1264–65 (11th Cir. 2017); see also McCarthy on Trademarks and Unfair Competition

§ 24:10 (discussing the retreat from Boston Hockey). But minimally, the court’s analysis was

included as part of a broader review of the fact-intensive inquiry into consumers’ likelihood

of confusion, which—while it suggests Penn State is likely to succeed on its broader claims—

does not support its efforts to dispose of this counterclaim at the motion to dismiss stage. See

Laite, 756 F.2d at 1546 (detailing how a University of Georgia professor received 10 to 15

inquiries from people concerned that the University was licensing its mascot to a brewing

company); see Doc. 38 at 13 (citing Laite, 756 F.2d at 1246); Doc. 40 at 13 (citing Laite, 756

creates between the trademark and trademark holder.36 The question as they saw it

was answered by sole reference to whichever party’s toil generated the sale, with no

need to undertake a fact-intensive inquiry into whether consumers believed the

trademark holder had manufactured or sponsored the product.37 The Trademark Trial

and Appeals Board, on the other hand, reasoned from the negative. It found that a

mark—like that of New York University’s—“inherently . . . . advise[s] the

purchaser [that] the university is the secondary source of that shirt” because “[i]t is

not imaginable that Columbia University will be the source of an N.Y.U. T-Shirt.”38

This per se approach (as I’ll call it) is forwarded by Penn State here; and, if adopted,

it would entitle the University to its motion to dismiss as there can be no doubt that

Vintage Brand’s customers are buying its Penn State products because of the

associations they create with the University.

That said, still more have rejected this per se approach—even if they

ultimately found that a bona fide mark had been infringed.39 Instead, as these courts

36 Boston Professional Hockey Ass’n, 510 F.2d at 1012 (“The certain knowledge of the buyer

that the source and origin of the trademark symbols were in plaintiffs satisfies the requirement

of the act. The argument that confusion must be as to the source of the manufacture of the

emblem itself is unpersuasive, where the trademark, originated by the team, is the triggering

mechanism for the sale of the emblem.”).

37 Id.

38 1973 WL 19761, at *1.

39 See Savannah Coll. of Art and Design, Inc., 872 F.3d at 1264–65; United States v. Giles, 213

F.3d 1247, 1250–51 (10th Cir. 2000); Supreme Assembly, Order of Rainbow for Girls, 676

F.2d at 1082; Int’l Ord. of Job’s Daughters v. Lindeburg & Co., 633 F.2d 912, 918 (9th Cir.

1981), cert. denied, 452 U.S. 941 (1981); Kentucky Fried Chicken Corp., 549 F.2d at 388;

Bd. of Governors of Univ. of North Carolina v. Helpinstine, 714 F. Supp. 167, 171 (M.D.N.C.

1989); Nat’l Football League Props., Inc. v. N.J. Giants, Inc., 637 F. Supp. 507, 515 (D.N.J.

have emphasized, trademark law requires more than a mental association between

the trademark and trademark holder. As they see it, the consumer must instead

believe that the trademark indicates that the trademark holder is the source, sponsor,

or is otherwise affiliated with the good—a question of fact.40 Vintage Brand

contends that the Court must minimally follow this approach (though it also suggests

the marks may inherently not serve a source identifying function, as I’ll address

later),41 thus allowing its claim to move past the motion to dismiss.42

This dispute has arisen in this Court, however, because many courts have still

not squarely addressed the question. And that list includes the Supreme Court and

the United States Court of Appeals for the Third Circuit. For the latter, that was

nearly not the case. In the early 1980s, a binding decision on the subject appeared to

be in the offing, as Champion Products v. University of Pittsburgh migrated back

and forth between the Western District of Pennsylvania and the Third Circuit.43

659–61 (W.D. Wash. 1982); see also Restatement (Third) of Unfair Competition § 25(1)

(“one may be subject to liability under the law of trademarks for the use of a designation that

resembles the trademark . . . of another without proof of a likelihood of confusion only under

an applicable antidilution statute.”); McCarthy on Trademarks and Unfair Competition § 7:24

(“whether an ornamental design also serves as a trademark requires a highly fact-dependent

analysis and a close examination of the probable impression made on the buying public”).

40 E.g., Supreme Assembly, Ord. of Rainbow for Girls, 676 F.2d at 1085 (treating as a fact

question “whether in a given case knowledge of the source of the symbol supports the

inference that many of the product’s typical purchasers would believe that the product itself

originated with or was somehow endorsed by the owner of the mark”).

41 Doc. 39 at 14.

42 Id. at 10–14.

43 See Univ. of Pittsburgh v. Champion Prods. Inc., 529 F. Supp. 464 (W.D. Pa. 1982) (Pitt I);

Univ. of Pittsburgh v. Champion Prods. Inc., 686 F.2d 1040 (3d Cir. 1982), cert. denied, 459

U.S. 1087 (1982) (Pitt II); Univ. of Pittsburgh v. Champion Prods. Inc., 566 F. Supp. 711

Because the cases make several appearances in the parties’ briefs, it’s worth setting

out what this trilogy did—and did not—say.44

The parties’ dispute emerged after Champion, who had long sold apparel with

the University’s name, logos, and mascot printed on it, balked at the University’s

request for a $100 licensing fee and a 6% royalty on its University of Pittsburgh

sales.45 The first of these cases considered not the bounds of the universities’

merchandising rights, but whether laches barred the University’s efforts to obtain a

retrospective accounting for past infringement and a prospective injunction.46 After

finding that the University had not objected to Champion’s practice between 1936

and 1980—and had in fact sent out catalogs with Champion products and stocked

them for many of those years in its school store—the lower court concluded that

laches barred the suit.47

On appeal, the Third Circuit found that while the lower court rightfully

rejected the University’s efforts to obtain an accounting for past infringement, it had

erred in denying prospective relief.48 The basis for its decision was a misapplication

of the laches doctrine.49 As the Third Circuit explained, in the laches-trademark

44 See Doc. 39 at 15; Doc. 40 at 12–13.

45 Pitt I, 529 F. Supp. at 468.

46 Id. at 469.

47 Id. at 467–69.

48 Pitt II, 686 F.2d at 1041.

49 Id. at 1045 (“[W]e do not believe that Pitt’s action rises to the level of outrageous and

inexcusable delay which will bar all relief even absent a showing of detriment to Champion.

context there are two classes of delay: one for lapses of a hundred years or more and

another for lesser delays.50 And while laches ordinarily requires a showing of

prejudice, for the first, none is required because in cases of abandonment-like delays

it’s “highly dubious that any court of equity would grant injunctive relief against

even a fraudulent infringer.”51 For the second, prejudice is required to avoid

prospective injunctive relief, but it is not required to avoid an accounting for past

infringement so long as the defendant can show that the trademark holder was silent

in the face of known use.52 Based on this bifurcated set-up, the Third Circuit

concluded that the facts established a lesser delay coupled with the University’s

knowledge and silence, barring the accounting claim.53 But that was not the case for

the prospective-relief claim. On this front, the court found not only that the facts did

not meet the abandonment standard, but that no such finding could be made as a

matter of law.54 In its view, there was no consequence to the lower court’s

detrimental reliance findings.55 And in this analysis, the court touched on the

50 Id. at 1044–45.

51 Id. at 1044 (quoting Anheuser-Busch v. Du Bois Brewing Co., 175 F.2d 370, 374 (3d Cir.

1949), cert. denied, 339 U.S. 934 (1950)).

52 Id. at 1044–45 (citing Menendez v. Holt, 127 U.S. 514, 524 (1888)).

53 Id. at 1045.

54 Id. at 1046, n.19.

55 Id. The district court found that Champion had “borne the risk of building the insignia soft

goods business,” invested in “an extensive creative art department for the development of

graphics and designs,” and “built up substantial goodwill in the business of selling soft goods

bearing college or university insignia,” with “a sales force of between 100 and 125 salesmen

burgeoning circuit split—then centered on the Ninth Circuit’s rejection of the Fifth

Circuit’s approach in Boston Hockey.

The Third Circuit framed the discussion around Champion’s position that it

had “created, developed and expanded the imprinted soft-goods industry with the

full knowledge of Pitt who should not now be permitted to profit from the markets

developed by Champion.”56 In the Third Circuit’s view, this was simply not true.57

It believed that Champion had built a plant, developed an art department, and

deployed a sales staff not in reliance on the University’s inaction, but on “its own

ability to develop and market such imprinted goods that the public, for whatever

reason, wishes to buy.”58 That made Champion’s circumstances unlike those in

laches cases in where “the junior [trademark] user had developed its entire business

around one name or product which the senior user then [sought] to prohibit it from

using or producing.”59 What’s more, as the court detailed, that Champion had

developed a local market for the University’s goods was “due not to the efforts of

Champion but rather to the efforts of the school” who made “that imprint

desirable.”60 These factual observations, which sunk Champion’s efforts to attain

prospective equitable relief, were drawn from Boston Hockey and its progeny. The

teachings of these cases, the court wrote, “is that, whatever the ultimate scope of

56 Id. at 1047.

57 Id. at 1048.

58 Id. at 1049.

59 Id. at 1047.

protection afforded, the crucial element is consumer desire to associate with the

entity whose imprint is reproduced,” and “[t]his desire is based on success or

notoriety which, in turn, is a result of the efforts of that entity.”61

Yet while the Third Circuit used Boston Hockey to highlight the nature of

Champion’s business and thus deconstruct the Company’s laches argument, it took

pains to note that it was not adopting the case as the law of the circuit. In fact, in

detailing the decisions, the court emphasized that the “precise contours” of the

doctrine were “by no means settled,”62 and later added that it “decline[d] to delve

into this fray without the benefit of its consideration by the district court and full

briefing of these most recent cases by the parties.”63

On remand, the district court did just that, rejecting the Boston Hockey

approach. It found that there was no likelihood of confusion as to the good’s source,

origin, authorization, or sponsorship; that the marks served the solely functional

61 Id.

62 Id. at 1048.

63 Id. Given that the Third Circuit offered this clear admonition and discussed these cases in the

context of whether Champion was entitled to equitable relief, the Court views the use of a

quote from the decision in McCarthy on Trademarks and Unfair Competition § 24:8 as

misleading. In discussing “Collateral Uses of a Mark,” the treatise points to the decision for

the notion that “the mark of a university on clothing can signify that the university endorses

and licenses the sale of such swearing apparel by the manufacturer,” which it then follows

with the statement: “In this context, the Third Circuit remarked that, ‘[T]he crucial element is

consumer desire to associate with the entity whose imprint is reproduced. This desire is based

on success or notoriety which, in turn, is a result of the efforts of that entity.’” Read charitably,

the general discussion of these cases, as the court ferreted out the laches issue, could be seen

as an acknowledgment that some courts have found that a mark can (not must) identify a

second source, but it seems plain to this Court that the quoted statement from the Third Circuit

was not made in this context, nor would the court have wanted this statement to be taken as

purpose of “allow[ing] the consumer to show his or her allegiance to Pitt”; and

finally that apparel with Pitt’s mark did not primarily serve a secondary purpose of

“identify[ing] the source of the product rather than the product itself.”64 But soon

after the lower court issued its opinion, the order was vacated by the Third Circuit—

a move prompted by a consent decree that was included in the parties’ settlement

agreement.65

Although the deluge of cases in the 1970s and 1980s were soon reduced to a

trickle—leaving this issue unresolved at the national and circuit levels—I see a clear

loser: the per se approach forwarded by Penn State in its motion to dismiss. My

reasoning is twofold. First, in the infringement context, efforts to walk back Boston

Hockey began not long after the decision came down. Within two years, the Fifth

Circuit sidelined the mental-associations approach, stressing that the analysis turns

not on whether consumers tie the symbol to the trademark holder, but on whether

they tie the product to the trademark holder.66 And that finding, the court

emphasized, requires a fact-intensive inquiry.67

64 Pitt III, 566 F. Supp. at 721 (quoting Inwood Labs., Inc. v. Ives Labs., Inc., 456 U.S. 844, 851,

n.11)

65 Glenn Wong, Recent Trademark Law Cases Involving Professional and Intercollegiate

Sports, 1986 Detroit Coll. of L. Rev. 87, 107 (citing Telephone interview with Gerald Norton,

Champion Products, Inc. (Mar. 15, 1986)).

66 Supreme Assembly, Ord. of Rainbow for Girls, 676 F.2d at 1084, 1084 n.7.

67 Id. at 1084 n.7 (“In Kentucky Fried Chicken Corp. v. Diversified Packaging Corp., 549 F.2d

368 (5th Cir. 1977), we explained that Boston Hockey does not always equate knowledge of

a symbol’s source with confusion sufficient to establish trademark infringement and we

treated as a fact question . . . whether in a given case knowledge of the source of the symbol

supports the inference that many of the product’s typical purchasers would believe that the

Second, I find the analysis offered by the Trademark Trial and Appeals Board

in its eligibility cases unconvincing. In the university context, these revolve around

In re Olin Corp. There, in explaining why a New York University-branded shirt

would identify the university as the sponsor or authorizer, the Board reasoned, “[i]t

is not imaginable that Columbia University will be the source of an N.Y.U. T-

shirt.”68 But this play on an intercollegiate rivalry distracts from an error in

reasoning: you cannot determine whether consumers believe an entity is the source

or secondary source of a good by crossing out one entity that consumers obviously

believe is not. The conclusion that purchasers will think that N.Y.U. sponsored or

authorized the shirt does not necessarily follow from the statement that no purchaser

will think that Columbia University is the source. There’s a gulf of other

possibilities.

The Court accordingly sees no reason to perpetuate or resuscitate this per se

approach. Whether consumers believe that a university is the source, sponsor, or

authorizer of merchandise bearing its marks should—minimally—turn on just that:

what the consumers believe. And for that reason, Penn State’s motion to dismiss is

denied.

cases demonstrate unbroken insistence upon likelihood of confusion and by doing so they

reject any notion that a trademark is an owner’s “property” to be protected irrespective of its

role in the operation of our markets.’”); see McCarthy on Trademarks and Unfair Competition

§ 24.10 (“The Fifth Circuit itself later retreated from the heresies of Boston Hockey” and that

its “attempt to stretch trademark law failed (and rightly so) because it violated a basic rationale

of trademark law.”).

Now, as either approach championed by Vintage Brand allows its case to

move forward, this Court declines to choose between them at this early stage. But to

ensure fulsome briefing of the issue in future proceedings and focus the parties’

minds on the sort of evidence to be adduced in discovery, the Court feels compelled

to offer an initial assessment.

By my categorization, the per se and fact-intensive approaches effectively

present the Court with the options always and maybe to the question: do purchasers

believe that the university authorized the merchandise bearing its emblems?

Although Vintage Brand stakes much of its case to the maybe approach, it also

contends that the answer may well be never.69 Its support for this proposition comes

from one area where, over the past two decades, the faucet has remained open: the

academic literature. In the pages of law reviews, there has been sharp criticism of

the creation of a broad merchandising right70—including from the intellectual

property field’s preeminent scholar.71 These criticisms are not rooted in the caselaw,

or at least the on-point caselaw, but as I see it, they are criticisms that Penn State

should be prepared to answer.

69 Doc. 39 at 14.

70 Dogan & Lemley; Mark A. Lemley, The Modern Lanham Act and the Death of Common

Sense, 108 Yale L.J. 1687 (1999) (Lemley); see also James Boyle & Jennifer Jenkins, Mark

of the Devil: The University as Brand Bully, 31 Fordham Intell. Prop. Media & Ent. L.J. 391

(2021); Jessica Litman, Breakfast with Batman: The Public Interest in the Advertising Age,

108 Yale L.J. 1717 (1999) (Litman).

71 According to one measure of scholarly impact, Lemley is the eighth most-cited legal scholar

of all time—ranking two spots back of Justice Oliver Wendell Holmes, Jr. and one ahead of

Judge Frank H. Easterbrook. Frank R. Shapiro, The Most-Cited Legal Scholars Revisited, 88

As a matter of first principle, these scholars contend that a merchandising

right, with its propertizing focus, is unmoored from trademark law’s “twin goals of

encouraging investment in product quality and preventing consumer deception.”72

And they further assert that such a right is downright irreconcilable with these goals

when consumers’ confusion comes not from their belief about the source, but from

their belief “that the defendant might have needed a license to use the mark.”73 As

these scholars emphasize, trademarks are not protected to dole out economic awards

to the party in the case caption that is most deserving; nor are they protected to

encourage entities to seek more of them. They are instead protected “to enable the

public to identify easily a particular product from a particular source.”74 This

rationale separates them from patents and copyrights, which offer limited “exclusive

economic rights to cure the presumed market failure that would result if copiers

could replicate expressive works and inventions without the cost of their

development.”75

This is not a bad thing. It may disincentivize investment in the school’s

merchandising; but it does not discourage investment in the underlying product—

the school’s academic and athletic programs.76 And while it likewise will not

encourage entities to seek out more trademarks, more trademarks have never been

72 Lemley, at 1688.

73 Id. at 1707.

74 Id. at 1695, 1708.

75 Dogan & Lemley, at 468–69.

the goal of the law. In fact, more (particularly when they identify just one entity)

may be worse.77 Additionally, as these scholars highlight, absent this market-

correcting justification, awarding a right works an economic harm.78 If through

trademark-created exclusivity an entity is free from competition, consumers suffer—

on price and on preference. Indeed, T-shirts are more expensive (that licensing

royalty has to come out of someone’s pocketbook). And as is perhaps shown by this

case, which involves a company that gained a toehold by offering gear with vintage

graphics, the entity may be less incentivized to come up with creative products that

meet consumer demand.

Beyond these theoretical issues, these scholars also emphasize that the

Supreme Court’s recent trademark decisions suggest that it may agree. One example

they give is the Dastar Corp. v. Twentieth Century Fox Film Corp.79 There, the

Supreme Court rejected an unfair competition claim under a “reverse passing off”

theory and, in doing so, emphasized the contours of the Lanham Act’s “origin of

goods requirement.”80 As the Court wrote, while the words could extend to those

“who commissioned or assumed responsibility for the product,” they were

“incapable of connoting the person or entity that originated the ideas or

communications that ‘goods’ embody or contain” and, as a general matter, “should

77 Id. at 1695.

78 Dogan & Lemley, at 481–82.

79 539 U.S. 23 (2003).

not be stretched to cover matters that are typically of no consequence to

purchasers.”81 In the scholars’ view, these statements not only foreclose a Boston

Hockey-like approach where the analysis turns on “‘the ideas or communications’

embodied in the product,” but if read broadly, “could require proof that it matters to

consumers whether the trademark holder officially sponsors merchandise bearing its

mark.”82

At the very least, these scholars conclude, if there is confusion about the

source, but the alleged infringer is making no claim of official sponsorship, recent

Supreme Court cases suggest the remedy should be a disclaimer.83 This is perhaps

the most serious charge, given its roots in Supreme Court precedent, the weight of

authority in favor of the fact-intensive approach, and the growing body of evidence

in similar contexts where consumers have in fact been confused about a good’s

source or sponsorship.

81 Id. at 32, 33.

82 Dogan & Lemley, at 500–01.

83 Id. at 465 n.14, 505 (citing Bonito Boats, Inc. v. Thunder Craft Boats, Inc., 489 U.S. 141, 154

(1989), Kellogg Co. v. Nat’l Biscuit Co., 305 U.S. 111, 122 (1938), TrafFix Devices, Inc. v.

Mktg. Displays, Inc., 532 U.S. 23, 34–35 (2001), and Sears, Roebuck & Co. v. Stiffel Co., 376

U.S. 225, 232 (1964)) (“If there is an identifiable product market, in the sense that the

trademark holder can command an above-market price because of the feature, the Supreme

Court has suggested that some remedy short of an injunction—such as a disclaimer is most

appropriate to alleviate any confusion. . . . The Court’s refusal to allow control over product

markets applies even in the face of clear evidence of trademark confusion.”). But see Boston

Professional Hockey Ass’n, 510 F.2d at 1013 (“The exact duplication of the symbol as the

team’s emblem satisfying the confusion requirement of the law, words which indicate it was

not authorized by the trademark owner are insufficient to remedy the illegal confusion. Only

And I’d be remiss not to mention the latter. Though the data is now decades

old, early N.F.L. trademark cases saw consumer confusion rates above 50%.84 These

results are not determinative here and can certainly be quibbled with at the margin.

(For instance, when Penn State is wearing its multimillion-dollar sports enterprise

hat and the goods are of an N.F.L.-like ilk, consumers may well be more confused

than they are when the University has its world-class research institution hat on and

the goods trend more classically collegiate.)

But the case for a disclaimer rather than an injunction lies at the base, not the

margin. Consumer-survey data taken at the same time as the N.F.L. cases showed

widespread belief among consumers that “[n]o product can bear the name of an

entertainer, cartoon character, or some other famous person unless permission is

given for its use”85—a belief that appears to have come from what they thought the

law required.86 The circularity is apparent: the law only offers protection if there’s

belief, yet the belief comes from consumers’ (mis)conception about the law. It would

seem perverse to award market exclusivity based on a fake-it-until-you-make-it

approach. If consumers’ confusion stems from their incorrect belief that goods

84 N.J. Giants, Inc., 637 F. Supp. at 515; Wichita Falls Sportswear, Inc., 532 F. Supp. at 661.

85 McCarthy on Trademarks and Unfair Competition § 24:12 (citing Harrison, “The

Merchandising Reporter’s First Consumer Survey on Licensing,” 2 Merchandising Rep. 22

(Aug. 1983) (Harrison)).

86 Id. § 24:12, n.9 (quoting Harrison) (“Some people indicated that, although this was legally

bearing Penn State’s emblem must be licensed, shouldn’t that belief be corrected,

not perpetuated?

IV. CONCLUSION

Ultimately, these are legal issues to be decided another day. Still, the

discussion should focus the parties’ minds on the issues to briefed in future motions.

And it should highlight a few essential questions that cannot, at summary judgment,

be answered through mere supposition: Indeed, what percentage of consumers are

confused about the source or sponsorship of Vintage Brand’s products? Does this

belief vary by logo or merchandise type? And does it stem from their belief that the

law requires Penn State’s permission?

The modern collegiate trademark- and licensing-regime has grown into a

multibillion-dollar industry. But that a house is large is of little matter if it’s been

built on sand.

An appropriate Order follows.

BY THE COURT:

s/ Matthew W. Brann

Matthew W. Brann

Chief United States District Judge