February 10, 2014 6:50 pm
Updated: February 10, 2014 9:04 pm

Dumb Starbucks? Dumber idea

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Dumb Starbucks” is a new coffee shop in Los Angeles that features all of the same branding as a regular Starbucks– including the same logo, store layout and menu design. You can even order a “Dumb Grande”or a “Dumb Chai Tea Latte.” If you do, you’ll also be given a “Frequently Asked Questions” handout which says that “for legal reasons Dumb Starbucks needs to be categorized as a work of parody art.”

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But despite its claims, Dumb Starbucks may well be infringing the intellectual property rights of its namesake.  Specifically, Starbucks Corp.’s copyright in its logo and its trademark rights in all aspects of its branding, including the word “Starbucks,” and Starbucks Corp. is not particularly known for tolerating this sort of thing see here and here.

“Fair dealing” or “fair use” as it is called in the U.S., is a legal doctrine that allows copyrighted works to be used for certain purposes (including parody) without the owner’s authorization. In the U.S., the term “trademark fair use”is also used to describe certain uses of trademarks, such as descriptive uses, that might otherwise be infringing.

READ MORE: ‘Dumb Starbucks’ creates confusion, long lines in Los Angeles

While parody is now recognized as a form of fair dealing in Canada, it hasn’t always been. In 1996, the Federal Court rejected the CAW’s parody-as-fair-dealing defence when it was sued for depicting the “Michelin Man” stepping on auto workers’ heads in a union leaflet.  It was not until 2012 when “parody” was added to the fair dealing provisions of Canada’s Copyright Act. While it existed as a form of fair use in the U.S. for much longer, it has never been an absolute defence to copyright infringement as the owners of Dumb Starbucks (who remain a mystery) seem to think it is.

The problem for Dumb Starbucks is that their use of Starbucks’ copyrighted logo – even if it is parody as they claim – still has to be “fair” to be fair use. When deciding whether a parodical use is fair, courts will consider a number of factors, including how extensive the copying is and how it is likely to affect the owner of the copyright. In this case, it seems distinctly unfair to simply add the word “Dumb” and copy everything else, including the business model itself – selling coffee. As they say right in the FAQ sheet, “we are a fully functioning coffee shop.” They might as well have added, “and direct competitors of Starbucks.”

While the trademark infringement case against Dumb Starbucks would be different, the result would very likely be the same. The primary purpose of trademark law is to ensure that consumers know who they’re buying from. It would be hard to argue that the average consumer would mistakenly believe that Dumb Starbucks is, or is affiliated with, Starbucks. But trademark law also protects against non-confusing uses of trademarks that are likely to tarnish a brand. While the elements of such a claim can be difficult to make out, suffice it to say that any Court would be eager to find them here.

Don’t expect a Dumb Starbucks to be opening in your neighbourhood any time soon.

John Simpson is the principal of Shift Law, an intellectual property and new media law boutique in Toronto.

© 2014 John Simpson

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