Confusing Use of Another Political Group's Name as "Source Identifier" May Lead to Trademark Injunction

A dissenting subgroup of the Libertarian Party of Michigan was barred from "from identifying as the Libertarian Party of Michigan in the provision of services."

From Wednesday's decision in Libertarian National Committee, Inc. v. Saliba, by Sixth Circuit Judge Julia Smith Gibbons, joined by Judges Guy Cole and Chad Readler:

This trademark action arises out of a dispute within the Libertarian Party of Michigan (referred to by name or as the "Michigan affiliate"). The Libertarian National Committee, Inc. ("LNC") sued dissenting members of the Michigan affiliate—mainly former officers of the affiliate or board members of local parties—for using the LNC's trademark to hold themselves out as the official Michigan affiliate after a turnover of power resulted in two factions claiming to hold power.

The district court granted the LNC's request to preliminarily enjoin the dissenting members' use of the mark, and the dissenting members appealed. They argue that the district court's application of the Lanham Act to the context of noncommercial speech both unduly expands the Act and violates the First Amendment. Even if the Lanham Act covers the dissenting members' use of the trademark, they argue that their use was authorized and not likely to cause confusion [details on this omitted -EV].

The circuit court largely agreed with the district court, concluding that trademark law may permissibly restrict confusing uses of another entity's name as "designat[ing the] source" of speech, goods, and services, even in political speech rather than commercial advertising:

In Taubman Co. v. Webfeats (6th Cir. 2003), this Circuit addressed the use of a shopping mall's trademark in domain names by the creator of a "fan site" and, after the relationship between the parties soured, a gripe site for that mall. The website creator contended that his purpose for using the mall's trademark in his websites was expressive rather than commercial, and thus outside of the realm of the Lanham Act and protected by the First Amendment. In combatting the defendant's allegation that the Lanham Act conflicted with the First Amendment, the Taubman Court reasoned that the Lanham Act is constitutionally sound "because it only regulates commercial speech, which is entitled to reduced protections under the First Amendment." …

In explaining why the defendant's use of the mall's mark was protected expression, the Taubman Court expounded that the defendant used the mark to comment on the trademark holder—not "to designate source." Jack Daniel's Properties, Inc. v. VIP Prods. LLC (2023). In other words, the defendant did not use the mark to pass off the goods or services advertised on his website as those of the shopping mall.

Since Taubman, the Supreme Court has explained how the Lanham Act and the First Amendment interact when a defendant uses a trademark to misrepresent his or her goods or services as those of or associated with the trademark owner. Just last year, the Court noted that where a defendant uses a trademark as a source identifier, "[t]he trademark law generally prevails over the First Amendment." Jack Daniel's Properties. This is because use of a trademark as a source identifier undermines the primary function of trademark law, which is to prevent "misinformation[ ] about who is responsible for a product" or service. Such is true even where the defendant's use of the mark also conveys an expressive message. Cf. San Francisco Arts & Athletics, Inc. v. U.S. Olympic Comm. (1987) ("The mere fact that the [nonprofit defendant] claims an expressive, as opposed to a purely commercial purpose does not give it a First Amendment right to appropriate to itself the harvest of those who have sown."). In that circumstance, "the likelihood-of-confusion inquiry does enough work to account for the interest in free expression."

We take this opportunity to clarify that Taubman's language limiting the Lanham Act's coverage, while implicated where a defendant uses the mark purely for protected expression, like satire, critique, or commentary, does not prohibit application of the Lanham Act to a defendant who uses the trademark to identify the source of his or her competing goods or services. Because the defendants here used the LNC's trademark to speak as the Libertarian Party of Michigan, defendants used the mark to designate the source of their political services as affiliated with the LNC, thus implicating "the core concerns of trademark law" and rendering Taubman inapposite.

Defendants resist this conclusion by emphasizing that Jack Daniel's Properties contemplated trademark infringement in the context of commercial products—a context in which trademark law traditionally and comfortably operates. True, trademark law was designed to combat potential consumer confusion and the theft of the trademark owner's goodwill in the context of commercial sales. And we acknowledge that outside of the facts before us, speech rendered in connection with the provision of political services typically constitutes political speech awarded heightened protection under the First Amendment. But we find support in Jack Daniel's Properties for our position that, in the narrow context where a defendant uses the trademark as a source identifier, the Lanham Act does not offend the First Amendment by imposing liability in the political arena.

While explaining why a predicate First Amendment test, rather than ordinary trademark scrutiny, does not apply when a defendant uses a trademark as a source identifier, Jack Daniel's Properties cited a case remarkably similar to the case at hand.. In United We Stand America, Inc. v. United We Stand, America New York, Inc. (2d Cir. 1997), the Second Circuit contemplated a trademark infringement action by United We Stand America, Inc., which owned the slogan, "United We Stand America." After friction within the group, the defendant created an offshoot political coalition, "United We Stand, America New York, Inc." which also used the slogan to engage in political activities.

The Second Circuit deemed the defendant's trademark use within the scope of the Lanham Act and outside the protection of the First Amendment because the offshoot group used the trademark "as a source identifier" for the group's political services rather than to pose "commentary on [the trademark's] owner." Accordingly, such use subjected the defendant to Lanham Act liability even though the offshoot coalition "might communicate its political message more effectively by appropriating [the trademark]."

The Supreme Court cited United We Stand with approval of the Second Circuit's decision to apply ordinary trademark scrutiny even though the defendant's use of the slogan also "had expressive content." Jack Daniel's Properties. Because the offshoot political coalition used the trademark "to suggest the 'same source identification' as the original 'political movement,'" such use was not insulated from Lanham Act liability. Id. (quoting United We Stand, 128 F.3d at 93). We find the Supreme Court and the Second Circuit's reasoning persuasive. Focusing on the use of a trademark as a source identifier adequately accounts for the core interests undergirding trademark law without "suck[ing] in speech on political and social issues through some strained or tangential association with a commercial or transactional activity." Radiance Found., Inc. v. N.A.A.C.P., 786 F.3d 316, 323 (4th Cir. 2015). Thus, in the narrow context before us, where a defendant uses a trademark as a source identifier, we find the extension of the Lanham Act into the political sphere appropriate.

Defendants next contend that, as a political entity, they do not render the type of services included in the scope of the Lanham Act. Accordingly, they argue, their use of the LNC's mark in connection with these services is not prohibited by the Lanham Act. A "service" is an "amorphous concept, 'denot[ing] an intangible commodity in the form of human effort, such as labor, skill, or advice.'" As defendants used the LNC's trademark to advertise a political convention, operate a website, promulgate political news and party activities, file campaign finance reports, endorse candidates, and solicit donations, they "unquestionably render[ed] a service" contemplated by § 1114(1)(a). United We Stand (finding "services characteristically rendered by a political party to and for its members, adherents, and candidates," like political organizing, maintaining an office, endorsing candidates, and distributing partisan material to be "services" under the Lanham Act)…. [T]he First Amendment tolerates the Lanham Act's interjection to prevent use of a trademark as a source identifier in a manner that creates confusion as to the source of the defendant's political services.

{ The district court clarified that the injunction merely prohibits defendants from identifying as the Libertarian Party of Michigan in the provision of services, it does not prevent them from identifying as members of the Libertarian Party or the Michigan affiliate, or from using the trademark to criticize or comment on either entity. We emphasize again that the Lanham Act does not restrict defendants' ability to engage in political speech. It merely restricts defendants from using the LNC's trademark to identify as the Libertarian Party of Michigan in connection with providing or advertising their own political services.}

"If different organizations were permitted to employ the same trade name in endorsing candidates, voters would be unable to derive any significance from an endorsement, as they would not know whether the endorsement came from the organization whose objectives they shared or from another organization using the same name." United We Stand America. Thus, we agree with the district court that defendants' use of the LNC's trademark in connection with the provision of competing political services created a high likelihood of confusion for consumers, i.e., potential voters, party members, and, in the case of solicitations not accompanied by a clear disclaimer, donors.

Defendants' use of the "Libertarian Party" mark meant that two different entities simultaneously held themselves out as the Libertarian Party of Michigan. A potential voter visiting defendants' website would not be able to tell if the platforms defendants espoused or events they advertised were actually affiliated with the Libertarian Party. Given defendants' use of the LNC's exact mark in the provision of competing political services to the same target population, such risk is at play here. And this risk is not hypothetical—the LNC submitted at least some evidence of actual confusion about the sponsorship of competing conventions. This likelihood of confusion is sufficient to support a Lanham Act claim.

Defendants also used the LNC's trademark on their website to solicit donations. In connection with the donation tab, defendants displayed one of two pop-up disclaimers notifying the potential donor of the governance dispute, the LNC's recognition of the Chadderdon-led faction, and that any donations would be going solely to defendants. The disclaimers also included hyperlinks to the Chadderdon-led affiliate's website. By clearly explaining the identity of the donation recipient, these disclaimers ameliorated the confusion the Lanham Act seeks to prevent. The disclaimers also resemble those we have previously found sufficient to eliminate a likelihood of confusion. Accordingly, defendants' use of the trademark in connection with their online solicitation of donations, when accompanied by appropriate disclaimers, does not create a sufficient likelihood of confusion as to the recipient of the funds and thus cannot be the predicate for Lanham Act liability….

We affirm the preliminary injunction granted except as to defendants' online solicitation accompanied by clear disclaimers.

Joseph J. Zito (DNL Zito Castellano) represents the plaintiff.