High-end fashion brand Louis Vuitton has lost its trademark suit against a tote-bag company My Other Bag, which markets canvas bags decorated with cartoonish reproductions of bags from high-end fashion lines (such as Chanel and Louis Vuitton), accompanied by the text “My Other Bag….”   This decision is notable, among other reasons, because it reaffirms the contours of the sometimes murky fair-use defense.

Last January, a district court in the Southern District of New York granted summary judgment to “My Other Bag,” finding that the company’s use of the Louis Vuitton mark was protected by a parody defense—the comedic use of Louis Vuitton images on inexpensive canvas totes was not likely to cause confusion or blur the fashion brand’s distinctiveness.  Also tossing Louis Vuitton’s copyright claims, the district court noted that tote-bag parody has “an obvious claim to transformative use,” by virtue of using existing material to create a new work that comments on the original.  While My Other Bag’s use was commercial, which tips the scales against a fair-use finding as a general matter, the court noted that a commercial use is not “presumptively unfair.”  The nature of the copyrighted work tipped in the defendant’s favor (the parody copies publicly known, expressive works) and the amount and substantiality of the copyrighted work used was reasonable, as the tote-bags must “successfully conjure Louis Vuitton’s handbags in order to make sense.”

The Second Circuit panel agreed on all counts, finding that the “joke on LV’s luxury image” constituted parody, and was protected as fair use.  See Louis Vuitton Malletier, S.A. v. My Other Bag, Inc., No. 16-241 (2d Cir).  The obvious differences in the defendant’s mimicking use of Louis Vuitton’s mark, the two products’ lack of market proximity, and the lack of convincing evidence of consumer confusion compelled the judgment in My Other Bag’s favor.  As the appellate court noted, an object expressing parody must convey simultaneous messages that it is the original, and that it is also not the original, but instead a parody.  The My Other Bag products, the panel held, do exactly that—namely, they reproduce a recognizable image of the targeted Louis Vuitton bags, but do so in a manner that is a clear departure from the brand’s luxury image.  The opinion also affirmed the lower court’s finding that My Other Bag’s use of Louis Vuitton designs did not infringe the brand’s copyright, but rather constituted transformative fair use.

As Judge Furman held in granting summary judgment in the lower court, “In some cases, it is better to ‘accept the implied compliment in [a] parody’ and to smile or laugh than it is to sue.”  This decision, now affirmed by the Second Circuit, should serve as an important lesson to companies as they seek to protect their brands under trademark and copyright law.