Copying and Industry Praise

In Google LLC v. DDC Technology, LLC, the challenged patents covered virtual reality viewers that enclosed a smartphone within a housing. The “button” solved a basic problem with those viewers. It allowed a user to interact with the phone’s touch screen while the phone remained enclosed inside the viewer.

The Patent Trial and Appeal Board (PTAB) found that the prior art disclosed the relevant claim limitations and that a skilled artisan would have been motivated to combine the references. But the PTAB still concluded that Google had not proved the claims obvious.

The PTAB found strong evidence that Google copied DDC’s product and prototype. It compared the products directly and determined that differences in their input mechanisms were minor and did not alter their fundamental features. The Federal Circuit affirmed, explaining that a product need not be an exact replica to support an inference of copying.

The PTAB also considered emails from Google engineers responding to a video of the prototype. Two engineers wrote, “That button is genius” and “That’s an ingenious button!” Google argued that the comments were merely polite compliments offered during an ongoing business relationship. The PTAB recognized that context but still gave the praise moderate weight. The Federal Circuit held that substantial evidence supported that determination.

Google argued that its prior art showing outweighed DDC’s objective evidence. The Federal Circuit disagreed, reiterating that objective indicia “may often be the most probative and cogent evidence in the record.” Because all the nonobviousness factors must be weighed together, the court found no legal error in the PTAB’s conclusion that Google had not proved obviousness.

What the Decision Means for IPR Practice

For patent owners, the decision highlights the value of product comparisons, evidence of access and contemporaneous reactions to prototypes. Copying requires more than showing that the accused product practices the claims. The evidence should show access to and replication of a product or prototype embodying the patented invention.

IPR petitioners should address in the petition known evidence of copying, industry praise and other objective indicia, including their nexus and weight. Because the petitioner retains the burden of proving unpatentability, objective indicia cannot be treated as an afterthought. In the right case, sometimes the button really is genius.

The issue is not limited to Halloween, of course, but Halloween costumes provide a particularly illustrative example of how cultural expressions can be transformed into commercial products, raising questions not only about cultural sensitivity but also about legal ownership and protection. What happens when imagery, clothing, symbols or traditions associated with a particular community enter the marketplace? And what role, if any, can trademark law play?

From Culture to Commerce

Legal scholars have defined cultural appropriation as taking another culture’s “intellectual property, traditional knowledge, cultural expressions or artifacts” without permission.[1] Embedded in that definition is a question familiar to intellectual property attorneys: Who, if anyone, has rights in the expression being used?

In the context of culture, that question becomes complicated. Cultural imagery, clothing, symbols and traditions often develop collectively over generations rather than originating with a single creator or an identifiable rights holder. That communal nature raises a difficult question of what it means for a cultural product to “belong,” in a legal sense, to a community, particularly when the community itself may be diffuse or its boundaries difficult to define. It also exposes a fundamental tension between cultural products and traditional intellectual property frameworks, which are not always well suited to recognizing or protecting collectively developed cultural expressions. Trademark law provides a particularly interesting example of that tension.

The Intersection of Trademark Law and Cultural Appropriation

Trademark law is designed to protect words, names, designs and other symbols when they function to identify the source of goods or services. Cultural significance, however, is not the same thing as trademark significance. A name, pattern, symbol or style of dress may be deeply associated with a particular community and function to identify the user as a member of that community, without simultaneously functioning as a trademark or qualifying for trademark protection.

The result is an imperfect overlap. When a culturally significant name or symbol also functions as a trademark, trademark law may provide a legal framework for addressing certain third-party commercial uses. However, cultural expressions not well suited for trademark protection may nevertheless be improperly commercialized or exploited by third parties without providing the source community with a corresponding remedy under the law. Scholars have examined this mismatch directly and have considered whether trademark law can be used to deter cultural appropriation, including whether source communities can register cultural products as marks and pursue trademark claims against third-party users. Conclusions are decidedly cautious, as trademark law is not particularly well suited to addressing cultural appropriation and viable trademark causes of action may be difficult to establish.[2]

Different Questions, Different Harms

Part of the disconnect stems from what the two concepts are trying to address. A traditional trademark infringement claim asks, among other things, whether a challenged use is likely to cause confusion regarding the source, sponsorship or affiliation of goods or services. Cultural appropriation, on the other hand, can raise concerns even where nobody is confused about the source of the product. Halloween costumes provide a particularly useful illustration of this distinction. Consumers may know exactly which company manufactured and sold a costume incorporating imagery associated with another culture, but that does not necessarily mitigate the harms that may result when the imagery is removed from its cultural context, commercialized without permission or used in a way the source community considers harmful.

For example, retailer Target recently sparked controversy over its sale of a children’s Halloween costume depicting blackface and minstrel imagery. Target subsequently removed the costume and apologized.[3] The incident is a stark reminder of trademark law’s limitations. Although consumers were not confused about the costume’s commercial source, that absence of confusion did not eliminate the harm caused by packaging and selling racist imagery as a consumer product.

The trademark and cultural appropriation inquiries therefore may overlap, but they do not necessarily ask the same question or address the same harm. Trademark law is primarily concerned with the source of goods and services, while criticism of cultural appropriation may instead focus on who is entitled to use and profit from cultural expression, as well as who bears the harm when that expression is misused. In that sense, the very absence of source confusion may limit trademark law’s ability to address the harms associated with cultural appropriation.

When Culture Does Not Fit the Trademark Model

Traditional intellectual property law contemplates identifiable creators and rights holders. In contrast, cultural expressions often develop collectively, sometimes over generations, without a single identifiable creator or owner. To communities, however, the absence of such an identifiable creator does not make cultural expression any less their own even where existing intellectual property law cannot provide an exclusive legal right to control its use. That gap becomes especially visible around Halloween, when cultural expressions can move rapidly from tradition to the costume rack.

The intersection of cultural appropriation and trademark law therefore may be as revealing for what trademark law does not protect as for what it does. A cultural expression can carry deep significance for a community without functioning as a trademark, and an improper commercial use of cultural expression can generate significant public and commercial consequences even without requiring a formal intellectual property claim. Perhaps the harder question, then, is not who owns culture but whether traditional notions of ownership are capable of capturing what it means for culture to belong to a community.

[1] Fordham Law News, Culturally Appropriative Halloween Costumes Create Controversy Nationwide (Oct. 26, 2016) https://news.law.fordham.edu/blog/2016/10/26/culturally-appropriative-halloween-costumes-create-controversy-nationwide/ (quoting Susan Scafidi, Who Owns Culture? Appropriation and Authenticity in American Law).

[2] Sari Sharoni, The Mark of a Culture: The Efficacy and Propriety of Using Trademark Law to Deter Cultural Appropriation 35 (2016) https://law.stanford.edu/wp-content/uploads/2016/09/The-Mark-of-a-Culture-The-Efficiency-and-Propriety-of-Using-Trademark-Law-to-Deter-Cultural-Appropriation.pdf (examining the efficacy of trademark law in protecting source communities from cultural appropriation).

[3] Nicholas P. Brown & Neil J. Kanatt, Target Apologizes for Children’s Clown Halloween Costume After Backlash (Aug. 24, 2026) https://www.reuters.com/business/retail-consumer/target-apologizes-childrens-clown-halloween-costume-after-backlash-2026-08-24/.

In Agricultural Utilization Research Institute v. Ejec Ventures, LLC, the Trademark Trial and Appeal Board (TTAB or Board) examined the distinction between source confusion and careless Internet searching. Its decision dismissing the opposition offers a practical lesson for brand owners: When documenting potential confusion, the explanation for a mistaken contact can matter more than the tally.

The Evidence: Misdirected Contacts, but Why?

The dispute concerned Ejec Ventures’ application to register AURI for “nutritional supplements in the form of gummies” and the Agricultural Utilization Research Institute’s (Institute) AURI-formative design marks for agricultural research, consulting and educational services. The Institute identified 102 purported instances of actual confusion between January 2023 and July 2025. They included misdirected emails and telephone calls intended for Ejec Ventures, ranging from consumer questions about gummy orders, subscriptions, refunds and deliveries to inquiries from prospective wholesalers and resellers.

The Board, however, declined to infer source confusion from the misdirected inquiries alone. The question was not simply whether people had contacted the wrong business but whether those contacts reflected a mistaken belief about the source or sponsorship of Ejec Ventures’ goods.

The Institute generally had not followed up with the individuals to determine why they had contacted it, leaving a plausible alternative explanation: inattentive Internet searching. Without evidence clarifying the reasons for the mistakes, the Board gave the inquiries limited probative value, treated the actual-confusion DuPont factor as neutral and ultimately dismissed the opposition.

Key Lessons for Brand Owners:

• Connect the mistake to source or sponsorship. Evidence should go beyond asserting that someone contacted the wrong business; it should explain whether the person believed the businesses or their offerings were connected.
• Investigate what caused the mistaken contact. Follow-up testimony or other corroborating evidence may help distinguish trademark confusion from an Internet search error or simple carelessness.
• Preserve context, not just a count. Retain original emails, voicemails and contemporaneous notes of telephone calls, including any explanation of how the person found your business and whom they intended to reach.

Misdirected inquiries can be useful evidence, but their weight depends on what they reveal about the person’s understanding. For brand owners, the lesson is to document not just that someone contacted the wrong business but why.

In Lost International, LLC v. Germanotta, No. SA CV 25-00592 FMO (KESx), 2026 WL 2415514 (C.D. Cal. Aug. 18, 2026), a California federal court dismissed trademark claims challenging Lady Gaga’s use of MAYHEM for her 2025 album, tour and related merchandise. The significant aspect of the decision is not merely that Lady Gaga prevailed; rather, the court never reached a likelihood-of-confusion analysis. It first asked a more fundamental question – whether her use of MAYHEM was functioning as a trademark at all.

Why the Court Dismissed the Claims

Lost International alleged long-standing rights in MAYHEM, including a federal registration for apparel, and claimed consumers could believe its surf business was affiliated with or endorsed by Lady Gaga’s project. The court applied Rogers v. Grimaldi, 875 F.2d 994 (2d Cir. 1989), which protects the use of marks in expressive works unless the use has no artistic relevance or explicitly misleads consumers about source or content.

Because artistic relevance was not disputed, the case turned on whether Lady Gaga’s use explicitly misled consumers as to source. The court held that allegations of similarity, likely confusion and even intent to deceive were not enough. Lost had not alleged an explicit statement or overt claim connecting it to Lady Gaga’s album, tour or merchandise.

The Post-Jack Daniel’s Boundary

The decision applies an important limit identified in Jack Daniel’s Properties, Inc. v. VIP Products LLC, 599 U.S. 140 (2023): Rogers does not apply when the defendant uses the challenged designation “as a mark” for its own goods. The Ninth Circuit applied that distinction in Punchbowl, Inc. v. AJ Press, LLC, 90 F.4th 1022 (9th Cir. 2024), where Rogers was unavailable because the challenged term functioned as the defendant’s source identifier.

The practical question after Jack Daniel’s therefore is whether the designation is identifying an expressive work, identifying the source of goods or doing both. For more on the later proceedings in the Bad Spaniels dispute, see our prior discussion of the Ninth Circuit’s tarnishment decision.

Why the Merchandise Ruling Matters

The most notable aspect of Lost International is its treatment of merchandise. MAYHEM appeared on commercial products, including apparel, but the court did not treat merchandise as an automatic gateway to trademark use or conventional infringement analysis. Instead, the court recognized that commercialization and source identification are not synonymous, finding that the challenged use remained tethered to the larger album-and-tour project rather than the assumption that placing MAYHEM on apparel converted the title into a separate, source-identifying and competing trademark.

That distinction matters across entertainment, sports, gaming and media. Commercialization alone does not answer the trademark-use question. A term appearing on apparel may identify the source of the shirt itself, or it may merely serve an informational function by identifying the album, tour, film, game, team or other expressive work that gives the merchandise its appeal. The product remains the same; the legal significance of the designation does not.

Viewed this way, Lost International highlights a key tension in modern trademark law: When does merchandise merely remain an extension of an expressive work, and when does it become a source-identifying trademark? As entertainment, sports, gaming and media brands increasingly expand across multiple revenue streams, courts may be forced to confront that question more frequently.

What Trademark Owners and Creators Should Watch

The ruling shifts attention from product overlap and mark similarity to marketplace function. A plaintiff facing an expressive-use defense may need facts showing an affirmative claim of sponsorship, endorsement or affiliation, such as statements in advertising, licensing materials, packaging, collaborations or other branding architecture. Allegations of identical marks and overlapping goods may carry less weight when a defendant shows the challenged designation as part of a broader expressive enterprise and not a stand-alone brand.

The court also identified fair use and aesthetic functionality as alternative grounds supporting dismissal, underscoring that even if a plaintiff can overcome Rogers, long-standing limits on trademark exclusivity may still bar relief. If Jack Daniel’s taught that trademark law applies when a defendant uses a designation as a source indicator, Lost International highlights the inverse question: When does a commercially exploited name stop telling a story and become a source-identifying trademark, if at all?

Key Takeaways

• Merchandise does not automatically establish trademark use. Courts should ask whether the designation identifies the underlying creative work or the source of the goods.
• Branding context matters. Advertising, licensing, packaging, collaborations and sponsorship claims may determine whether a title functions as a mark.
• Clearance should anticipate expansion. A title may begin as expression and later extend into merchandise, tours, licensing and other commercial uses.
• Expressive-use cases require different evidence. Explicit claims of affiliation may matter more than similarity and confusion allegations.

Bottom line: Lost International suggests that courts will look beyond the mere appearance of a title on merchandise and focus instead on its marketplace function. As creative properties increasingly evolve into multiplatform commercial ecosystems, the fundamental question before analyzing likelihood of confusion is whether consumers encounter the designation as the name of a creative work, a source identifier or both.

That question sits at the center of the lawsuit Chanel filed against TaROO, a retail store, and its owner in the United States District Court for the Southern District of New York. Chanel, Inc. v. Taroo Second, Inc., No. 24-cv-9038 (S.D.N.Y.). Chanel alleges that TaROO knowingly sold counterfeit Chanel-branded handbags, apparel, and accessories and continued doing so despite receiving multiple cease-and-desist letters. In response, TaROO has emphasized that consumers were aware they were purchasing replica products rather than authentic Chanel merchandise, contending that the products’ low prices and the alleged use of the term “replica” eliminated any meaningful risk of point-of-sale confusion. The dispute therefore raises a broader question: Does trademark law cease to apply simply because a purchaser knows the product is fake?

The answer has long been no. A seller cannot avoid trademark liability merely because an immediate purchaser understands that a lower-priced product is a replica, copy, or counterfeit. Relevant confusion may occur later, when third parties encounter the goods and mistake them for genuine articles or believe that the trademark owner authorized their sale. The doctrine therefore protects against marketplace harms that a point-of-sale disclosure cannot necessarily cure.

TaROO’s argument focuses on only one potential form of confusion, that is the purchaser’s understanding at the moment of sale. Yet trademark infringement is not confined to such narrow inquiry. Courts have long recognized that trademark law protects against harms extending beyond the immediate purchaser at the cash register or entering credit-card information online. A purchaser’s knowledge that a product is counterfeit does not end the infringement inquiry. Nor does a seller avoid liability simply by acknowledging that its unauthorized goods are replicas. Instead, Courts consider broader marketplace harms, including confusion among observers after the sale and injury to the goodwill embodied in the owner’s trademarks.

Post-Sale Confusion and Beyond: Protecting Goodwill, Reputation and Brand Value

Counterfeit products are frequently marketed and sold as replicas or “superfakes.” These coined terms signal to consumers that the goods are inauthentic but intended to closely mimic genuine goods associated with a famous brand. The appeal of these products for some consumers stems from the fact that they closely resemble authentic products while carrying a significantly lower price tag. Consumers seeking out replica products therefore often do so intentionally and with a full understanding that the product has not been manufactured or sold by the brand owner.

The purchaser, however, is not the only consumer for whom confusion matters. Nor is the point of sale the only moment at which confusion may arise. “Post-sale confusion” focuses on the perceptions of individuals who encounter a product after it has already entered the marketplace. The relevant question is whether those observers are likely to attribute the unauthorized goods to the trademark owner or believe that the owner approved them — not simply whether the first purchaser understood that the goods were not genuine.

The Second Circuit addressed this precise dynamic over 25 years ago in Hermès International v. Lederer de Paris Fifth Avenue, Inc. 219 F.3d 104, 108–10 (2d Cir. 2000). There, sellers openly told customers that their handbags were Hermès copies, yet promoted the bags on the premise that third-party observers could not tell them from the genuine article. The court held that the absence of point-of-sale confusion did not eliminate actionable post-sale confusion because, inter alia, members of the public could mistake the knockoffs for genuine Hermès goods. Id.; see also Lois Sportswear, U.S.A., Inc. v. Levi Strauss & Co., 799 F.2d 867, 872–75 (2d Cir. 1986) (affirming injunction against substantially similar jeans-pocket stitching because labels did not eliminate likely source and affiliation confusion when the jeans were seen after sale); Ferrari S.P.A. Esercizio Fabbriche Automobili e Corse v. Roberts, 944 F.2d 1235, 1244–46 (6th Cir. 1991) (affirming liability for replica Ferrari vehicles despite disclosures that purchasers were not buying genuine Ferraris because the replicas could cause post-sale source confusion and damage Ferrari’s reputation); Polo Fashions, Inc. v. Craftex, Inc., 816 F.2d 145, 147–48 (4th Cir. 1987) (holding that an interior label did not cure post-sale confusion where observers seeing the polo-player emblem on a worn shirt could attribute the inferior garment to Polo).

Together, these decisions illustrate why post-sale confusion can harm a trademark owner even when the initial purchaser knowingly buys a replica. Consumers who encounter replicas in the marketplace may wrongly attribute their poor quality, defects, or inferior performance to the trademark owner rather than the counterfeiter. That mistaken association harms the trademark owner by weakening the goodwill embodied in its marks and undermining the reputation for quality that those marks represent. The trademark owner therefore bears the reputational consequences of products it neither manufactured nor approved. The counterfeiter, meanwhile, captures the commercial benefit of the mark without assuming responsibility for the standards the mark represents.

For luxury brands, the potential harm extends beyond product quality. Much of the value of a luxury trademark lies in the prestige, exclusivity, and status associated with the brand—attributes that brand owners spend decades cultivating and protecting. The widespread availability of counterfeit and replica products threatens that value by placing the mark on goods the brand owner neither manufactured nor approved. As a result, consumers and observers may associate the mark with commonplace, unauthorized products rather than carefully controlled luxury goods. Post-sale confusion can therefore threaten a brand’s reputation for quality as well as the distinctiveness, prestige, and goodwill that make its marks valuable in the first place.

Beyond Fashion: The Same Principles Apply Elsewhere

Courts have applied these principles well beyond the fashion industry. In the Ferrari decision, for example, the Sixth Circuit recognized that replica automobiles could create actionable post-sale confusion even when the initial purchasers knew they were not buying genuine Ferraris. Similarly, in Acad. of Motion Picture Arts & Scis. v. Creative House Promotions, Inc., the Ninth Circuit held that post-sale confusion was possible where the defendant distributed a gold statuette known as the “Star Award,” which closely resembled the Academy’s famous “Oscar” award. 944 F.2d 1446 (9th Cir. 1991). Although initial purchasers understood they were not buying genuine Oscars, recipients and other observers could nevertheless mistakenly associate the award with the Academy. In finding that the Academy had sufficiently demonstrated a likelihood of confusion between the awards, the Ninth Circuit emphasized the district court had “ignored the problem of post-purchase confusion” by failing to recognize that recipients and later viewers of the defendant’s award encounter it “outside the context in which it is originally distributed” and may therefore “confuse the Star Award with the Oscar.” Id. at 1456.

These cases reflect the broader concern shared by brands across a wide range of industries: products encountered in public can create mistaken source or sponsorship associations long after the initial sale has occurred. Whether the product is a handbag, an automobile, or even a ceremonial award, courts have consistently recognized that post-sale confusion can inflict the same reputational and goodwill-related harms that trademark law is designed to prevent.

Key Takeaways for Brand Owners

Seen through this lens, it becomes clear why the confusion inquiry does not and should not end with a purchaser’s knowledge that a product is not genuine. Trademark law protects against more than confusion at the moment of sale; it also safeguards the goodwill, reputation and distinctiveness embodied in a trademark, all of which can be harmed when infringing goods enter the marketplace. As courts recognize, confusion may arise after the sale when consumers and observers encounter infringing products and mistakenly associate them with the brand owner. Accordingly, the fact that a product is marketed or sold as a replica does not insulate the seller from trademark infringement liability; a simple label cannot neutralize the marketplace confusion and harm caused by the unauthorized use of another’s mark.

For trademark owners confronting sales of infringing products to knowing consumers, several practical lessons emerge:

• A purchaser’s knowledge that a product is infringing will not by itself defeat a trademark infringement claim.
• The post-sale confusion doctrine remains a powerful tool for brand owners seeking to combat counterfeit and replica goods.
• Courts recognize that trademark law protects against harms extending beyond the initial sale, including reputational injury, dilution of goodwill and damage to the distinctiveness of a mark.
• For luxury brands in particular, the relevant inquiry extends beyond product quality to encompass the prestige, exclusivity and status associated with the trademark itself.
• Businesses that market counterfeit products as replicas or use other euphemisms to describe unauthorized goods should not assume that labeling alone eliminates trademark risk, particularly when those products trade on the recognition, reputation and goodwill of a famous brand.

[1] Counterfeiting is a particularly egregious form of trademark infringement involving the use of a spurious mark that is identical with, or substantially indistinguishable from, a registered trademark. 15 U.S.C. § 1116(d)(1)(B).

A lot has happened since then. We have two subsequent decisions, Bartz v. Anthropic and Kadrey v. Meta, that found that the use of content to train LLMs is allowed under the fair use doctrine. And now the Third Circuit has affirmed that February 2025 opinion in Ross, adopting some aspects of Judge Stephanos Bibas’ opinion but rejecting others. Although the opinion attempted to distinguish the LLM cases, the analytical framework deployed in the opinion might impact future generative AI cases. In doing so, the Third Circuit has diverged from Bartz v. Anthropic, setting up a possible circuit split.

The Opinion Attempts to Distinguish Generative AI Cases, But …

The opinion noted that “ROSS’s AI was not a generative AI, meaning it would not create any new expression; it would only return text passages from preexisting judicial opinions.” On this basis, the opinion dismissed concerns raised by the Department of Justice (DOJ) in another copyright AI fair use case, In re OpenAI, Inc. Copyright Infringement Litigation, over restrictive fair use opinions and their impact on American competition in the artificial intelligence industry. The opinion further minimized the DOJ’s concerns by noting that LLM training may not result in “substitutive competition” with the works that they are trained on, while ROSS’s AI training was for the express purpose of competing with Thomson Reuters’ Westlaw product.

Thus, on the face of it, the opinion has limited applicability and ought not to have any impact on the LLM and other generative AI training cases. But the closer you look at the reasoning of the opinion, the more potentially impactful it becomes.

The Nature of the Transformation

The ROSS product was “an AI legal search engine that would respond to plain-language legal questions with relevant passages of text from judicial opinions.” To enable that search, the AI model “had to learn what made a judicial opinion responsive to a user’s legal question.” In other words, the “ROSS AI program [sought] to identify patterns regarding which judicial opinion passages respond well to legal questions.”

To do that, ROSS used a vendor to create legal memos that in some instances contained Westlaw headnotes, and it used the headnotes to benchmark and rank responses to legal queries. There was no evidence that the ROSS program ever outputted Westlaw headnotes or that the Westlaw headnotes were used after the AI model was trained.

Although the ROSS training was aimed at the noncopyrightable aspects of the Westlaw headnotes (i.e., detecting patterns of answer accuracy), the opinion nonetheless found the use was only minimally transformative: “ROSS’s platform uses Thomson Reuter’s headnotes to help users find judicial opinions related to their legal research inquiries, something Thomson Reuters already does with its headnotes.”

At a certain degree of generality (i.e., if you zoom out far enough), that makes some sense. It is true that the ROSS product as a whole (which used other answer-accuracy benchmarks, software development techniques and source code) generally competes with Westlaw as a whole (which contains other headnotes besides the ones used as well as other software features and types of content). But there is a difference between nontransformative substitutive use and commercial competition. As Judge William Alsup noted in Bartz, “The Act seeks to advance original works of authorship, not to protect authors against competition.”

Thus, the substitutive use must be aimed at the work itself (i.e., the headnotes used). This distinction was aptly articulated by Bibas in his 2023 summary judgment opinion: “[I]f Ross’s AI only studied the language patterns in the headnotes to learn how to produce judicial opinion quotes,” then ROSS’s use was transformative. If, however, ROSS’s use was “to get its AI to replicate and reproduce the creative drafting done by Westlaw’s attorney-editors,” then the use was not transformative. This distinction was lost in the subsequent 2025 summary judgment opinion and was not addressed at all in the Third Circuit opinion.

What Is ‘Necessary’?

Where the opinion stands to cause the most problems in future AI cases, however, is its application of a “strict” necessity standard to justify use of the underlying work. The opinion addressed the applicability of intermediate copying cases, in which software was downloaded to access noncopyrightable aspects of the software. The justification for copying in those cases was that there was no other way to access the nonprotectable aspects of the software but through the protectable code.

The opinion converts the factual background of those intermediate copying cases into an immutable maxim: “Here, ROSS does not need to copy Thomson Reuters’s headnotes to access the underlying unprotected information. … It chose not to do so because copying the headnotes offered an ‘easy’ way to create its training memos. Unlike necessity, ease is not a justification for copying.”

However, the standard for justifying use of the underlying work is not one of “strict necessity.” Under Warhol, the defendant need only show that the use was “reasonably necessary.” This distinction played an important role in Bartz, where the author plaintiffs argued that Anthropic did not strictly need to copy their specific books, or any books at all, to create its LLM. However, Anthropic demonstrated that there was a technological justification for the copying (i.e., the need to train on a “monumental” volume of texts), leading Alsup to conclude: “Because using so many works was reasonably necessary, using any one work for actually training LLMs was about as reasonable as the next.”

Where does one draw the line then between “ease” and “reasonable necessity”? What cost threshold did ROSS have to cross before using the Westlaw headnotes was easy versus necessary? What technological challenges had to be posed? We don’t know, because the opinion doesn’t say.

Impact on Future Cases

All eyes are currently on the generative AI copyright cases – 145 of them as of the date of this post. Those cases mostly involve LLMs or other multipurpose foundation models. But there is a great surge in enterprise use of AI to create fine-tuned or other “small models.” Those models might involve the use of content from competitors to obtain noncopyrightable information – market trends, competitive intelligence, product design ideas. If future courts interpret this opinion as prohibiting competitive uses and imposing a strict necessity standard, the impact it could have on the development of customized AI models is significant.

Today’s consumers can spot a copy. Trademark law, however, is still largely built around a different question: are consumers confused?

That tension sits at the center of New Balance Athletics, Inc. v. Decathlon America LLC. In its recently filed complaint, New Balance asserts claims for trademark infringement and false designation of origin, both of which generally require a likelihood of consumer confusion, as well as dilution of its allegedly famous “N” mark, which does not.

The case raises a broader question that extends beyond the parties involved: If consumers increasingly recognize copying without being confused, is confusion still the right inquiry?

New Balance’s complaint reads like a textbook dilution pleading. It details decades of use of the iconic “N” mark, extensive sales and advertising, multiple incontestable federal registrations, and a prior federal court decision recognizing the mark as famous. By the time the complaint turns to Decathlon’s conduct, it has laid a substantial foundation for both its infringement and dilution claims.

Against that backdrop, New Balance alleges that Decathlon’s KIPRUN running line, featuring a stylized “K” on the sides of its shoes, frequently uses a mirror-image version of the design that consumers perceive as an “N.” New Balance further alleges that Decathlon’s use of the design across its products and marketing creates initial-interest, point-of-sale and post-sale confusion in a market heavily influenced by athlete endorsements, race coverage and social media.

Perhaps the most interesting aspect of the complaint is what many of the social media commentaries do not show. Many commenters did not appear confused about source. Instead, they characterized the products as “rip-offs,” “knock-offs” or imitations of New Balance. The comments may support New Balance’s allegations, but they also highlight an increasingly common phenomenon: Consumers can perceive copying as unfair even when they understand that the products come from different companies.

In other words, the complaint raises a question larger than whether Decathlon’s conduct is actionable: What legal causes of action fit when consumers aren’t confused, but still view copying as unfair?

New Balance likely has legal tools that many brands do not. If its allegations are proven, it can pursue not only infringement and false designation of origin claims but also dilution claims based on the asserted fame of its marks. Decades of use, substantial investment and prior judicial recognition of fame place New Balance in a strong position to challenge alleged free riding on its brand equity.

But what happens when a younger brand faces similar copying?

Many companies encounter look-alike products, imitation branding and copycat competition long before they develop the level of fame necessary to support a dilution claim. Yet traditional trademark doctrines often provide limited relief in those circumstances.

• Trademark infringement and false designation of origin require confusion. Modern consumers can often recognize imitation, copying and brand misappropriation while fully understanding that the products originate from different companies.
• Trade dress protection remains difficult and expensive to obtain. Successful claims generally require substantial evidence of distinctiveness, non-functionality and consumer recognition. For emerging brands, those hurdles can be difficult to overcome until the very goodwill they seek to protect has already been established.
• State unfair competition law frequently follows the same path. Many unfair competition claims remain tied to deception and consumer confusion, leaving conduct perceived by consumers as unfair copying outside the reach of traditional trademark remedies.

Together, these limitations expose a growing disconnect in trademark law. Consumers increasingly recognize copying without being confused by it. Yet many trademark doctrines continue to hinge on confusion, while dilution protection remains reserved for a relatively small group of famous brands.

Trademark law does recognize a separate category of particularly egregious copying: counterfeiting. But counterfeiting claims generally require use of a mark that is identical to or substantially indistinguishable from the genuine, registered mark. Many of today’s alleged “dupes,” “look-alikes” and “knock-offs” are carefully designed to capture marketplace recognition while stopping short of outright duplication, leaving brand owners to rely on traditional infringement, trade dress or dilution theories instead.

New Balance may ultimately prevail because it can invoke both infringement and dilution theories. The more difficult question is what protection exists for brands that have neither. As consumers become more sophisticated, connected and vocal, courts and lawmakers may increasingly confront the gap between confusion and perceived unfair free riding. If consumers have evolved, perhaps the law will need to evolve as well.

The case is New Balance Athletics, Inc. v. Decathlon America LLC et al., No. 1:26-cv-14235 (D. Mass. Sept. 15, 2026). The case has been assigned to Magistrate Judge Jessica D. Hedges.

Two Forums, Two Different Results

The dispute involved U.S. Patent No. 11,697,028, which covers a photodynamic dermatology device. Sun Pharmaceutical asserted the patent against Biofrontera at the ITC. Biofrontera challenged the asserted claims as obvious before the ITC while also pursuing an IPR based on the same claims, prior art, and obviousness grounds.

The two proceedings produced opposite results. An ITC administrative law judge concluded that Biofrontera had not shown the asserted claims invalid as obvious. In February 2026, the PTAB reached the opposite conclusion and issued a final written decision finding all challenged claims unpatentable.

On May 6, the ITC affirmed the finding that the claims had not been shown invalid and found a violation of Section 337. It issued a limited exclusion order and cease-and-desist orders but suspended enforcement as to the ’028 patent because of the conflicting PTAB decision.

Sun sought Director Review. On July 29, USPTO Director John Squires vacated the PTAB’s final written decision, dismissed the petition, and terminated the IPR. He concluded that “there was no justifiable reason for the Board to have reached a different patentability determination than the ITC.”

Sun then asked the ITC to lift the suspension. On Sept. 1, the Commission did so, making its remedial orders fully enforceable as to the ’028 patent.

The public record does not establish formal coordination between the agencies. But their successive actions produced a consistent result. The Director vacated the PTAB’s obviousness decision based on the ITC’s earlier determination. The ITC then lifted its suspension and gave full effect to its remedial orders.

An IPR Is an Alternative, Not an Additional Forum

The USPTO has proposed rules that would limit parties to one collective opportunity to challenge patent validity. Among other things, the rules would require the Office to deny institution when a claim already has been tested and upheld in another forum or when another proceeding is likely to resolve validity first. They also would require a petitioner to forgo certain invalidity challenges in other forums if the IPR is instituted.

Biofrontera goes further. The proposed rules focus on whether an IPR should be instituted. Here, the IPR had proceeded through trial, and the Board had issued a final written decision. The Director nevertheless vacated that decision and dismissed the proceeding.

Squires grounded his decision in the purpose of AIA review. Quoting an earlier precedential decision, he explained that AIA review is “to provide a quick and cost-effective alternative” to litigating validity in other forums, not another forum for simultaneously litigating the same dispute.

The Director did not hold that the PTAB is bound by an ITC patentability determination or establish categorical issue preclusion between the agencies. Instead, he concluded that the Board must meaningfully account for an earlier adjudication involving the same or substantially the same claims, evidence, and arguments. A different result requires an adequate explanation.

The Board had identified three principal reasons for reaching a different result. The IPR included supplemental expert testimony. And the forums applied different burdens of proof.

The Director found none to be sufficient. An ITC initial determination, he explained, may support terminating an overlapping IPR before Commission review is complete. By the time the Director acted, the Commission also had affirmed the finding that Biofrontera failed to prove obviousness.

The supplemental expert testimony also appeared to backfill gaps in the petition. Biofrontera did not submit it until its reply, after shortcomings in the same obviousness theory had emerged in the ITC proceeding. If the evidence was critical, the Director reasoned, it should have been included in the petition.

Finally, the different burdens of proof did not, “without more,” explain the conflicting technical findings. The ITC credited evidence concerning the difficulty of achieving uniform illumination and rejected Biofrontera’s theory. The PTAB reached the opposite conclusion without adequately explaining the discrepancy.

The decision places a substantial burden on a party seeking a different result from the PTAB after another tribunal has considered materially the same challenge. The PTAB’s lower burden of proof, standing alone, may not be enough.

The One-Bite Principle Already Has Teeth

Parties should not assume that the PTAB’s lower burden of proof guarantees another opportunity to litigate an unsuccessful validity challenge. When the PTAB and another tribunal consider the same claims, prior art, grounds, and substantially the same evidence, the first adjudication may affect whether the PTAB proceeding survives. Even a final written decision may be vacated if the Board fails to justify a different result.

The consequences can extend beyond the PTAB. Here, vacating the Board’s decision cleared the way for the ITC to enforce its remedial orders. Forum selection and timing therefore may affect both whether an IPR survives and when an ITC remedy takes effect.

The Director framed AIA review as an alternative to litigating validity in another forum, not another opportunity to pursue the same challenge. Biofrontera shows that the USPTO is willing to enforce that view even after the PTAB issues a final written decision. The one-bite principle already has teeth.

On Aug. 4, the Ninth Circuit vacated the Arizona district court’s permanent injunction against VIP’s Bad Spaniels dog toy and directed entry of judgment in VIP’s favor on Jack Daniel’s dilution-by-tarnishment claim. The decision follows the U.S. Supreme Court’s 2023 ruling that parody is not categorically exempt from trademark claims when the accused use also functions as a source identifier.

The Bad Spaniels toy at issue closely resembles the appearance of a Jack Daniel’s whiskey bottle while replacing key elements with humorous references, including Bad Spaniels, Old No. 2, 43% Poo By Vol. and 100% SMELLY. Although the Supreme Court rejected application of the Rogers test because VIP was using the design as a trademark for its own product, it left the merits of the infringement and dilution claims for the lower courts to decide.

On remand, the district court again found dilution by tarnishment. The Ninth Circuit disagreed.

Association Alone Is Not Tarnishment

The Ninth Circuit emphasized that creating an association with a famous mark is only the starting point for a tarnishment claim. A plaintiff must go further and show that the association is likely to harm the famous mark’s reputation.

Jack Daniel’s relied heavily on expert testimony suggesting consumers generally react negatively when food or beverage products are associated with bathroom humor. The court found that evidence insufficient because it did not address whether consumers encountering the Bad Spaniels toy were likely to think less of the Jack Daniel’s brand as a result.

Parody Still Matters

Although parody no longer provides an automatic shield where the accused use functions as a trademark, the Ninth Circuit reaffirmed that parody remains highly relevant to the merits analysis.

A successful parody simultaneously evokes the original brand while also signaling that it is not the original. According to the court, that second message can reduce the likelihood that consumers will perceive the use as harming the reputation of the famous mark. Because Bad Spaniels was an obvious joke, the court found that Jack Daniel’s had failed to show likely reputational injury.

Fame Must Be Proven Mark by Mark

Another important aspect of the decision is the court’s holding that fame must be analyzed separately for each asserted mark. Jack Daniel’s successfully established fame for the JACK DANIEL’S word mark and its bottle trade dress, but the court stated it failed to prove that OLD NO. 7 independently qualified as a famous mark under the federal dilution statute.

Practice Pointers for Brand Owners

• Audit your portfolio and identify which marks can be proven “famous” under the federal dilution statute.
• Do not assume that fame in a house mark extends to taglines, sub-brands, product names or packaging elements.
• Develop product-specific consumer surveys and expert evidence when pursuing tarnishment claims.
• Focus on proving actual reputational harm, not merely consumer association.
• Consider whether litigation may amplify the challenged use and generate more attention than the parody itself.

Practice Pointers for Accused Parody Users

• Evidence showing consumers understand the use as an obvious joke may help defeat claims of reputational harm, even when parody is not a complete defense.
• Context matters: the stronger the signal that the product is commentary rather than a source-identifying extension of the famous brand, the harder it may be for a plaintiff to prove tarnishment.
• Survey evidence, marketplace context and the nature of the accused product all may help show that consumers understand the parody without transferring negative perceptions to the famous mark.

The Ninth Circuit’s decision does not eliminate dilution-by-tarnishment claims for parodies, but it makes clear that plaintiffs must present rigorous evidence of fame and likely reputational injury. Unless altered through rehearing or Supreme Court review, the decision directs entry of judgment for VIP and vacates the injunction against the Bad Spaniels toy. Going forward, courts are likely to scrutinize tarnishment claims more closely where the challenged use is humorous, obviously parodic and disconnected from the plaintiff’s actual goods or services. For now, Bad Spaniels stands as an important reminder that tarnishment requires more than a joke in bad taste; it also requires evidence that the joke is likely to damage the brand.

Following the Eastern District of New York’s decision finding Rebel liable for trade dress infringement, unfair competition and dilution, and awarding Van Leeuwen nearly $23.8 million in disgorged profits, Rebel filed a notice of appeal and, shortly thereafter, commenced a Chapter 11 case in the U.S. Bankruptcy Court for the District of Utah. The bankruptcy filing automatically stays further proceedings against Rebel and may delay Van Leeuwen’s efforts to collect on the monetary judgment.

At least for now, the bankruptcy filing does not appear to alter the district court’s injunction, which prohibits Rebel from selling products bearing trade dress likely to be confused with Van Leeuwen’s and requires Rebel to redesign its packaging to avoid using Van Leeuwen’s trade dress elements. The extent to which the bankruptcy proceedings will affect the enforcement or implementation of that injunctive relief remains to be seen.

For a deeper dive into the court’s decision, see our previous blog post, “Why Van Leeuwen Won When So Many Trade Dress Plaintiffs Lose,” available here.