Lyons Partnership LP v. Giannoulas

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

_____________________

No. 98-11003

_____________________

LYONS PARTNERSHIP,

Plaintiff-Appellant,

versus

TED GIANNOULAS, doing business

as Famous Chicken; TFC, INC.,

Defendants-Appellees.

_________________________________________________________________

Appeals from the United States District Court for the

Northern District of Texas

_________________________________________________________________

July 7, 1999

Before REAVLEY, JOLLY, and EMILIO M. GARZA, Circuit Judges.

E. GRADY JOLLY, Circuit Judge:

Lyons Partnership LP (“Lyons”), the owners of the rights to

the children’s caricature Barney, sued Ted Giannoulas, the creator

of a sports mascot--The Famous Chicken (“the Chicken”)--because the

Chicken had incorporated a Barney look-alike in its act. The

district court granted summary judgment to Giannoulas and awarded

attorneys’ fees.

On appeal, Lyons raises six issues, the most important of

which is whether the district court erred when it determined that

there was insufficient evidence that Giannoulas’s use of the Barney

trademark caused consumer confusion under the Lanham Act.1 Because

we agree with the approach taken by the district court, we affirm.

I

This case involves a dispute over the use of the likeness of

“Barney,” a children’s character who appears in a number of

products marketed to children.2 Barney, a six-foot tall purple

“tyrannosaurus rex,” entertains and educates young children. His

awkward and lovable behavior, good-natured disposition, and

renditions of songs like “I love you, you love me,” have warmed the

hearts and captured the imaginations of children across the United

States. According to Lyons, the owner of the intellectual property

rights for Barney and the plaintiff in the suit below, the

defendants--Giannoulas d/b/a The Famous Chicken and TFC, Inc.

(“TFC”), the owner of the intellectual property rights to the

Chicken--sought to manipulate Barney’s wholesome image to

accomplish their own nefarious ends.

The Chicken, a sports mascot conceived of and played by

Giannoulas, targets a more grown-up audience. While the Chicken

1

We have reviewed the other issues raised by Lyons and, after

a consideration of the arguments made on appeal and a review of the

briefs and the record, find no reversible error.

2

These items include television shows, videotapes, books,

magazines, music albums, and plush dolls. In addition, a person

dressed in a Barney costume has made public appearances at numerous

events, including inaugural balls at both of President Clinton’s

inaugurations, a Red Sox game (where Barney threw the first pitch),

and a public appearance with Nelson Mandela.

2

does sell marketing merchandise, it is always sold either by direct

order or in conjunction with one of the Chicken’s appearances.

Thus, the Chicken’s principal means of income could, perhaps

loosely, be referred to as “performance art.” Catering to the

tastes of adults attending sporting events, most notably baseball

games, the Chicken is renowned for his hard hitting satire.

Fictional characters, celebrities, ball players, and, yes, even

umpires, are all targets for the Chicken’s levity. Hardly anything

is sacred.

And so, perhaps inevitably, the Chicken’s beady glare came to

rest on that lovable and carefree icon of childhood, Barney. Lyons

argues that the Chicken’s motivation was purely mercenary. Seeing

the opportunity to hitch his wagon to a star, the Chicken

incorporated a Barney look-alike into his acts. The character, a

person dressed in a costume (sold with the title “Duffy the

Dragon”) that had a remarkable likeness to Barney’s appearance,

would appear next to the Chicken in an extended performance during

which the Chicken would flip, slap, tackle, trample, and generally

assault the Barney look-alike.

The results, according to Lyons, were profound. Lyons regales

us with tales of children observing the performance who honestly

believed that the real Barney was being assaulted. In one poignant

account related by Lyons, a parent describes how the spectacle

brought his two-year-old child to tears. In fact, we are told,

3

only after several days of solace was the child able to relate the

horror of what she had observed in her own words--“Chicken step on

Barney”--without crying. After receiving such complaints from

irate parents who attended the Chicken’s performances with their

children, Lyons sought to defend this assault on their bastion of

child-like goodness and naiveté.

Giannoulas offers a slightly different perspective on what

happened. True, he argues, Barney, depicted with his large,

rounded body, never changing grin, giddy chuckles, and exclamations

like “Super-dee-Dooper!,” may represent a simplistic ideal of

goodness. Giannoulas, however, also considers Barney to be a

symbol of what is wrong with our society--an homage, if you will,

to all the inane, banal platitudes that we readily accept and

thrust unthinkingly upon our children. Apparently, he is not alone

in criticizing society’s acceptance of a children’s icon with such

insipid and corny qualities. Quoting from an article in The New

Yorker, he argues that at least some perceive Barney as a “pot-

bellied,” “sloppily fat” dinosaur who “giggle[s] compulsively in a

tone of unequaled feeblemindedness” and “jiggles his lumpish body

like an overripe eggplant.” The Talk Of The Town: Pacifier, The

New Yorker, May 3, 1993 at 37. The Internet also contains numerous

web sites devoted to delivering an anti-Barney message.3

3

One Internet search service provides a list of links to anti-

Barney web sites, many of which contain warnings like the

4

Giannoulas further notes that he is not the only satirist to take

shots at Barney. Saturday Night Live, Jay Leno, and a movie

starring Tom Arnold have all engaged in parodies at the ungainly

dinosaur’s expense.

Perhaps the most insightful criticism regarding Barney is that

his shows do not assist children in learning to deal with negative

feelings and emotions. As one commentator puts it, the real danger

from Barney is “denial: the refusal to recognize the existence of

unpleasant realities. For along with his steady diet of giggles

and unconditional love, Barney offers our children a one-

dimensional world where everyone must be happy and everything must

be resolved right away.” Chala Willig Levy, The Bad News About

Barney, Parents, Feb. 1994, at 191-92 (136-39).

Giannoulas claims that, through careful use of parody, he

sought to highlight the differences between Barney and the Chicken.

Giannoulas was not merely profiting from the spectacle of a Barney

look-alike making an appearance in his show. Instead, he was

engaged in a sophisticated critique of society’s acceptance of this

ubiquitous and insipid creature. Furthermore, Giannoulas argues

that he performed the sketch only at evening sporting events.

The sketch would begin with the Chicken disco dancing. The

Barney character would join the Chicken on the field and dance too,

following: “If you’re offended by material that suggests the

killing of Barney, or like him in any way, please don’t come here.”

5

but in an ungainly manner that mimicked the real Barney’s dance.

The Chicken would then indicate that Barney should try to follow

the Chicken’s dance steps (albeit, by slapping the bewildered

dinosaur across the face). At this point, Barney would break

character and out-dance the Chicken, to the crowd’s surprise. The

Chicken would then resort to violence, tackling Barney and

generally assaulting Barney. Barney would ultimately submit to the

Chicken and they would walk off the field apparently friends, only

for the Chicken to play one last gag on the back-in-character naive

and trusting Barney. The Chicken would flip Barney over a nearby

obstacle, such as a railing.

Lyons ultimately filed a suit against Giannoulas and TFC,

alleging trademark infringement, false association, unfair

competition, and trademark dilution under the Lanham Act, copyright

infringement, and other claims. The district court granted the

defendants’ motion for summary judgment. In addition, the district

court awarded attorneys’ fees to the defendants based on provisions

in the Copyright Act. Lyons has filed a timely appeal with respect

to the Lanham Act claims, the Copyright Act claims, and the award

of attorneys’ fees.

II

Because this case comes to us on appeal from a summary

judgment motion, we review the district court’s decision de novo

applying the same standards applied by the district court. See

6

Boyd v. State Farm Ins. Cos., 158 F.3d 326, 328 (5th Cir. 1998).

The moving party is entitled to summary judgment if the record

establishes that “there is no genuine issue as to any material fact

and that the moving party is entitled to a judgment as a matter of

law.” Fed.R.Civ.P. 56(c).

A trademark is a word, name, symbol or device adopted and used

by a manufacturer to identify the source of goods. To establish a

trademark violation, Lyons must establish that Giannoulas has used

in commerce a mark confusingly similar to Lyons’s. 15 U.S.C.

§ 1127.4 The district court held that there was no likelihood of

consumer confusion. In reaching this decision, the district court

relied on its finding that the Chicken’s performance was clearly

meant to be a parody.

Lyons makes two arguments with respect to its trademark

confusion claim. First, Lyons argues that Giannoulas’s use of

Barney was not intended as a parody. Because Lyons continues to

contest this issue on appeal, we first address whether there are

4

With respect to services, a mark is used in commerce “when it

is used in the sale or advertising of services.” Id. In this

case, Lyons has a trademark in the image of Barney. Giannoulas

contends that he has not used the image of Barney in the stream of

commerce--i.e., that he only used the appearance of Barney to

signal a parody of Barney, not to use Barney’s image to promote the

Chicken’s service. Lyons contends that there is a factual issue

regarding whether Giannoulas used images of the Barney character

that appeared in mass media to promote his service. A review of

the record reveals a genuine issue of material fact with respect to

whether Giannoulas was promoting his show through media

representations of the Barney caricature.

7

any genuine issues of material fact regarding whether Giannoulas

was engaged in parodying Barney. Lyons’s second argument is that

the district court accorded too much weight to its finding that

Giannoulas’s use was a parody.

A

In general, a parody is defined as an “artistic work that

imitates the characteristic style of an author or a work for comic

effect or ridicule.” Campbell v. Acuff-Rose Music, 510 U.S. 569

(1994)(quotation omitted). In general, a reference to a

copyrighted work or trademark may be permissible if the use is

purely for parodic purposes. To the extent the original work must

be referenced in order to accomplish the parody, that reference is

acceptable. Giannoulas claims that his use of a Barney look-alike

clearly qualifies as a parody. He used the minimum necessary to

evoke Barney--while he used a character dressed like Barney that

danced like Barney, he did not make any other references to the

mythical world in which Barney resides. He did not, for instance,

incorporate any of Barney’s other “friends” into his act, have the

character imitate Barney’s voice, or perform any of Barney’s songs.

According to Giannoulas, Barney was clearly the butt of a joke and

he referenced the Barney character only to the extent necessary to

conjure up the character’s image in his audience’s mind.

Lyons argues that the conduct was not a parody but simply the

use of Barney. To support this claim, Lyons points to two kinds of

8

proffered evidence. First, Lyons notes that Giannoulas himself

admits that he did not have a definite plan when he incorporated

Barney into the act. Lyons argues that this creates an issue of

fact regarding whether Giannoulas really intended to parody Barney

or simply intended to profit from incorporating the Barney

character into his act.

This argument is meritless. Clearly, in the context in which

Giannoulas intended to insert a reference to the Barney character,

the humor came from the incongruous nature of such an appearance,

not from an attempt to benefit from Barney’s goodwill. This point

is clearly established by the fact that the Chicken’s actions

toward Barney seem to have always been antagonistic. Although the

performance may have evolved into a far more sophisticated form of

commentary, even at its inception, it was clearly meant as a

parody.

The second argument made by Lyons is that the audience could

not have understood the performance to be a parody. Lyons assumes

that the target audience here is children and that children would

clearly believe that the caricature actually was Barney. Although

Lyons is correct that the intended audience is an important factor

in determining whether a performance qualifies as a parody, Lyons

presented no credible evidence that a significant portion of the

audience at evening sporting events are children. Even if young

children--like the two-year-old who had such a traumatic reaction

9

to the down-trodden Barney--are in attendance, we would expect them

to be supervised by parents who could explain the nature of the

parody.

We therefore agree with the district court that Giannoulas’s

use of the caricature clearly qualifies as a parody. We note that

Lyons’s insistence that the Chicken’s act is not a parody is, in

our view, a completely meritless argument.5

B

In order to understand Giannoulas’s second argument, we must

first review our own precedent with respect to consumer confusion

under the Lanham Act. Our case law has set out a long list of non-

exclusive, non-dispositive factors to consider when determining

whether a use can result in confusion. These factors are referred

to as the “digits of confusion.” “In determining whether a

likelihood of confusion exists, this court considers the following

non-exhaustive list of factors: (1) the type of trademark

allegedly infringed, (2) the similarity between the two marks, (3)

the similarity of the products or services, (4) the identity of the

retail outlets and purchasers, (5) the identity of the advertising

media used, (6) the defendant's intent, and (7) any evidence of

5

It was, in fact, the plaintiff’s tenacity in making this

argument that led the district court to conclude that an award of

attorneys’ fees to Giannoulas was appropriate. Given the argument

made by the plaintiffs, we agree completely with the district court

on this point.

10

actual confusion.” Elvis Presley Enters. v. Copeck, 141 F.3d 188,

194 (5th Cir. 1998); Conan Properties, Inc. v. Conan’s Pizza, Inc.,

752 F.2d 145, 149 (5th Cir. 1985); Armco, Inc. v. Armco Burglar

Alarms Co., 693 F.2d 1155, 1159 (5th Cir. 1983). The Fifth Circuit

has held that confusion resulting from a parody is not an

affirmative defense to a trademark infringement claim but is

instead an additional factor that should be considered. Elvis, 141

F.3d at 149.

The district court relied on its finding that the conduct was

a parody when considering each of the remaining factors or digits

described in Elvis. Giannoulas’s argument is that, based on our

reasoning in Elvis, the relevance of the conduct being a parody is

only one “digit” to be considered among the “digits of confusion.”

Lyons argues the district court erred by relying on the conduct

being a parody to conclude that the other factors did not indicate

a risk of confusion. The crux of Lyons’s argument is that, when

considering whether conduct is likely to cause consumer confusion,

even if there is overwhelming evidence that the conduct is a

parody, the other digits of confusion must still be considered

separately, without reference to whether the conduct is a parody.

If, after conducting this analysis, there are factors that support

the plaintiff’s claim, he argues that the plaintiff should be

permitted to proceed to trial.

11

Although such a hypertechnical reading of Elvis and its

progeny may, on some abstract level, appear logical, we find this

analysis absolutely absurd. Such an approach would all but require

a trial for any trademark suit where the conduct was a parody. A

brief consideration of only one of the digits of confusion makes

this point clear.

The first digit, that is, the type of trademark allegedly

infringed, questions whether the trademark is so distinctive that

a consumer encountering the defendant’s mark would be likely to

assume that the source of a product or service is the owner of the

trademark. Thus, under the traditional analysis, the stronger the

trademark, the more likely that this factor would weigh in favor of

the plaintiff. However, as the district court correctly noted in

this case, when a consumer encounters the use of a trademark in a

setting that is clearly a parody, the strength of the mark may

actually make it easier for the consumer to realize that the use is

a parody. Therefore, a strong mark is not as relevant a factor

when the use is that of parody.6

6

Lyons cites to Elvis to argue that a strong mark can be

relevant even in the context of a parody. In Elvis, however, the

issue was whether the Elvis trademark had been infringed by a

nightclub titled “the Velvet Elvis.” In that case the parody was

not of Elvis but of cheesy sixties bars. Therefore, because Elvis

was not the brunt of the joke, the fact that Elvis is a strong

trademark could be regarded as an endorsement of the nightclub.

12

It seems reasonable to us to expect that most comedians will

seek to satirize images or figures who will be widely recognized by

their audiences. It therefore seems unlikely that comedians will

target trademarks that do not have significant strength. If the

district court were not able to consider the relevance that parody

plays in this analysis, the district court would almost always have

to conclude that this digit of confusion weighed in favor of the

plaintiff. Such a result would effectively tie the district

court’s hands unnecessarily and prevent the district court from

applying common sense to determine whether a particular factor is

actually likely to lead to confusion.

Simply put, although the fact that conduct is a parody is not

an affirmative defense to trademark infringement, a parody should

be treated differently from other uses that infringe on a

trademark. While it is only one factor to consider, it is a factor

that must be considered in conjunction with all of the other digits

of confusion. When, as here, a parody makes a specific, ubiquitous

trademark the brunt of its joke, the use of the trademark for

satirical purposes affects our analysis of the factors to consider

when determining whether the use is likely to result in consumer

confusion.

We therefore conclude that the district court did not err in

considering the other digits of confusion in the light of its

finding that the Chicken’s performance is a parody. In doing so,

13

we hold that, when we stated in Elvis that use as parody was a

relevant factor, we did not intend for the nature of the use to be

considered separately from the other digits of confusion. The

district court ably considered the other digits of confusion in

this respect, and we find no error in its conclusion that there is

insufficient evidence to support a violation under the Lanham Act.

III

In this case, Lyons argued that Giannoulas’s use of a Barney

caricature violated the Copyright Act and the Lanham Act. The

district court disagreed and a review of the record indicates that

the district court did not err in doing so. On appeal, we address

only the argument related to the relevance that parodic conduct has

on determining the likelihood of confusion in a trademark

infringement case. We note that in this case the conduct was,

without doubt, a parody. Having made that finding, the district

court did not err in concluding that the nature of Giannoulas’s use

is relevant when analyzing the other digits of confusion to

determine likelihood of confusion. For the foregoing reasons, the

ruling of the district court is

A F F I R M E D.

14