Comparative Study on the Permissible Scope & Standard of a
Trademark Parody *Invited Researcher: KIM, Won Oh **In recent years, parody is widespread not only among copyrighted works but also
among trademarks. This is probably attributable to the changes in the culturalenvironment and people's mindset and also to the realization of the usefulness of parody
as a form of creation and expression. The purpose of this study is to establish standards
to distinguish permissible trademark parody from impermissible trademark parody. I
analyzed the laws, regulations, and relevant judicial precedents in major countries.
Before such analysis, I identified important issues related to trademark parody from theviewpoints of trademark holders and parodists respectively. I paid careful attention to
the characteristics of trademark parody and the difference between trademark parodyand copyright parody. In the case of commercial trademark parody, it would raise theissue of trademark registrability in the phase of trademark examination and also raise
the issue of infringement under the Trademark Act and the Unfair Competition
Prevention Act in the phase of infringement lawsuit. I analyzed the relevant legal
systems designed to control trademark parody in the U.S., Europe, Japan, and South
Korea and specific cases of trademark parody that occurred in those countries. Basedon the results of a comparative analysis, I was able to identify the issues that tend toarise in the phase of trademark examination and in the phase of infringement lawsuit.
The analysis results show that there were no cases where parody trademarks were foundregistrable. I listed the possible reasons. On the other hand, I found that majorcountries take different stances when it comes to infringement, more specifically,
trademark infringement and dilution-related infringement. Japan and South Korea havea negative view on trademark parody because these two countries consider trademark
parody as an act of free-riding on the trust and good reputation of another party.
Naturally, in these countries, there have been no cases where trademark parody was
found lawful. Meanwhile, Europe has a tradition of accepting a wide range of politicaland artistic trademark parody, while still having a negative view on commercial
This is a summary of the report published under the 2018 Collaborative Research Project on Harmonization of Industrial Property
Right Systems under a commission from the Japan Patent Office.
* * Professor, Inha Law School.
*itrademark parody in many cases. However, Europe might change its stance due to the
influence from the European Court of Human Rights and "Recital 21 of Council
Regulation No. 2017/1001" The U.S. accepts the use of a parody trademark not only asa type of nominative fair use, but also as a non-actionable activity under the dilution
theory. Furthermore, in some cases, the U.S. and Europe find trademark parody to be ameans of free expression by limiting the scope of rights protected under the trademark
law and the unfair competition prevention law in order to achieve a balance between
trademark parody and the freedom of expression guaranteed under the Constitution. As
a conclusion of my paper, I addressed these issues in a comprehensive manner anddescribed various categories and characteristics of permissible trademark parody andidentified the requirements for successful trademark parody.

The purpose of this study is to establish the standards to distinguish permissible
trademark parody from impermissible trademark parody. To achieve this goal, I
analyzed the laws, regulations, and relevant judicial precedents in major countries.
Before such analysis, I examined the functions of trademark parody and categorized
trademark parody into different types based on various standards in order to determine
what types of trademark parody should be subject to the trademark law. I paid carefulattention to the characteristics of trademark parody and the difference between
trademark parody and copyright parody.
In Chapter II, I examined and analyzed the legal status of trademark parody. Thereis a clear difference between trademark holders and parodists in terms of the stance on
trademark parody. I identified the legal issues that could be raised by each side of a
trademark parody-related dispute. In order to understand what legal defense could beraised, I first examined the possibility for trademark holders to allege trademark
infringement or dilution-related infringement under the trademark law or the unfair
competition prevention law and then try to understand the usefulness and value ofparody that parodists want to enjoy. Although parody does not make an independent
defense, it could be additionally taken into consideration by a court when determining
the risk of confusion. Under a certain law or regulation, it might be possible forparodists to raise a defense of nominative fair use or to allege that trademark parody is
non-actionable under the dilution theory. I came to the conclusion that parodists havegood chances to make an effective claim from the perspective of the freedom of
expression guaranteed under the Constitution.

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In Chapter III, I made a comparative study on the registrability of a parody
trademark. I examined the relevant laws and regulations in the U.S., Europe, Japan, andSouth Korea and also analyzed specific disputes that occurred in these countries inorder to make a comparison and grasp the current situation. The research results show
that, unlike trademark infringement cases, most parody trademarks were rejected orinvalidated in the phase of trademark examination in those countries on the grounds
that it is very difficult to make an exception for and register such trademark and thatsuch trademark could cause confusion with already registered trademarks or could
unlawfully free-ride on or dilute a reputable trademark. The grounds for such rejection
an invalidation can be summarized as follows: (1) Since a parodist's act of filing anapplication for registration of a parody trademark constitutes an intentional act of using
a parody mark as an indication of the source of goods, such act cannot be considered to
be non-actionable under the dilution theory in the U.S. based on the conventional
interpretation of the relevant statutory provisions; (2) If a trademark is registered, theholder of the trademark would be given an exclusive right to the registered form of
expression. It would be against the spirit of the First Amendment to the U.S.
Constitution that guarantees the freedom of expression; (3) In the phase of infringement
lawsuit, a parody trademark in use would be at issue. Thus, it would be easy to takespecific transactional circumstances into consideration. On the other hand, in the phaseof application filing, it would often be difficult to take specific transactional
circumstances into consideration; and (4) the patent office tends to hesitate to shoulder
any risk because there might be various changes in the conditions and circumstances
after registration.
In Chapter IV, I examined the laws and regulations related to trademark
infringement and dilution-related infringement in the U.S., Europe, Japan, and South
Korea and analyzed relevant cases in order to make a comparison and understand thecurrent situation. Europe widely accepts political and artistic trademark parody, but
still has a negative view on commercial trademark parody. However, Europe mightchange its stance due to the influence from the European Court of Human Rights and"Recital 21," which is the preamble of Council Regulation. When determining the riskof causing confusion, the U.S. does not accept parody as an independent defense, but
additionally takes it into consideration when making such determination. Since theenforcement of the Lanham Act amended in 2006, parody exemption has been explicitly
specified in said Act. Thus, it would be effective to raise a parody defense. In the caseof a successful parody trademark, it would not be necessary to examine the trademarkiii

by using six tests to determine whether the trademark would cause dilution because
parody exception would apply to dilution-related infringement on the condition that thetrademark has never been used as an indication of the source of goods. If the trademark
has been used as an indication of the source of goods, all the factors related to dilution
will be taken into consideration before making a determination as to whether the
trademark is infringing or not. On the other hand, the U.S. and Europe are likely to findtrademark parody as a means of free expression by limiting the scope of rights protectedunder the trademark law and the unfair competition prevention law in order to achievea balance between trademark parody and the freedom of expression guaranteed under
the Constitution.
Secondly, since the use of a parody trademark is similar to nominative fair use, itwould be more preferable to raise a defense of nominative fair use, which has been
permitted under case law in the U.S., than a defense of descriptive fair use. A defenseof nominative fair use would be accepted if it can be proven that the essential
requirements are satisfied. In Europe, there is no explicit provision concerning
trademark parody. However, there is an explicit legal provision concerning thelimitation of the effect of a trademark right in the case of nominative fair use. Under
this provision, it would be possible to raise a defense. On the other hand, although
Japan and South Korea do not have a legal provision or case law concerning nominative
fair use, it would be possible to claim exemption based on the "genuine trademark use"theory. If a trademark is not used as a trademark, but used as a means to transmit or
express a political or social message, such trademark use as a parody may be considered
to be an exception to trademark infringement. Thirdly, the difference in the basic
understanding of the trademark parody among countries greatly affects the judicial
judgments made in each country. Some people believe that parody should be widely
accepted because parody is a form of expression that should be respected in a culturalenvironment where everyone respects freedom and creativity and has the freedom of
expression, that trademarks should be considered to be not only property but also alanguage that should be freely available for communication among the members ofsociety, that, even if a trademark embodies reputation, since the trademark still
functions as a symbol, trademark parody can be used as an effective means to carve out
a niche market by criticizing the policy of the trademark holder and its symbolic image
and sending a new message to consumers. In contrast, under a controlled social
environment where order and discipline are highly valued, people would have a negative
view of parody, which is critical and humorous in nature. Also, under the legaliv

environment where people believe that it would be against the objective of the
trademark law to take advantage of the trust, reputation, and customer appeal embodied
in another person's famous trademark by using or registering a trademark similar tosuch famous trademark, people would have a negative view of trademark parody. Major
cases that reflected such cultural difference were the "Louis Vuitton v. My Other Bag"case in the U.S. and the "Louis Vuitton v. The Face Shop" case in South Korea, which
can be regarded as a Korean version of the "My Other Bag" case. A U.S. court explained
why the bag of "My Other Bag" is different from the plaintiff's handbag and held that
it is different from the case where the plaintiff's mark was used simply for the purposeof advertising and selling goods. The U.S. court concluded that the bag of "My Other
Bag" should be regarded as a successful parody of the indication of the plaintiff anddid not constitute dilution-related infringement. Although this U.S. judgment could
have been used as an effective judicial precedent in the trial of the South Korean case,a parody defense was not accepted in South Korea. The South Korean court seems tohave found that the critical message that the defendant tried to convey was not properly
understood by general consumers, in other words, "the parody was unsuccessful." Thisdifference between the two judgments was caused by the culture difference between thetwo countries. Also, the difference may be partially attributable to the fact that in the
U.S., people are busy discussing the negative sides of the dilution-related infringement
theory and encouraging courts to reflect judicial precedents in their judgments, whereas
such discussions are insufficient in South Korea.
In Chapter V, I examined the essential requirements for successful trademark parody
and the acceptability of parody depending on the type of trademark parody. As
mentioned above, (i) trademark parody is more likely to be accepted in the phase of
infringement lawsuit than in the phase of trademark examination. (ii) Trademark parody
would be accepted if the trademark was not used as a trademark and the trademark use
can be considered as nominative fair use. Example cases would be the case where aparody trademark is used not as an indication to distinguish the source of goods, but(1) used as a means to convey a political message or to provide information about acertain fact, (2) used in a book, film, or any other medium or in an advertisement, (3)used to criticize the problems of the target goods or to make a comparison between thetarget goods and one's own goods, or (4) used not as an indication of the source ofgoods or as a trademark to distinguish one's goods from others such as the use of aparody trademark in order to complete the design or decorative function of the goods
or used in such manner that the use can be considered to be nominative fair use. Thesev

types of trademark parody should be considered to be permitted under law. (iii)
Regarding the types and characteristics of parody, the two-category system consistingof commercial parody and non-commercial parody is still in use to determine theacceptability of parody, while the system was applied more flexibly than before.
Needless to say, non-commercial parody trademarks would not be subject to any law
concerning signs and marks in any country in the world. According to the judicial
precedents in Germany, the acceptability of trademark parody would not be affected bywhether the trademark is commercial or not. In view of the fact that most parody
trademarks are used for commercial purposes to some extent, such trademarks should
not be prohibited just because they are used for commercial purposes. It is important toexamine whether the parody in question truly contributes to achieving the fundamental
purpose of parody and satisfies the requirements for fair use and to check whether theparody trademark was created with the intention of causing confusion by taking
advantage of the reputation of the original trademark. In the field of trademarks, anarrow sense of critical parody is distinguished from exaggeration parody (satire) andonly the former type of parody is permitted to be used. Lastly, (iv) I identified thefundamental requirements for trademark parody. First, parody must fulfill thefundamental requirements in order to fall under the definition of parody. Good parody
must have a function of creating association between the parody and the target original
work or trademark. At the same time, a parody must be distinguishable from the original
trademark. In sum, parody must allow the viewers to conjure up the original work (theoriginal trademark) so that they can receive the message of the original work (theoriginal trademark) and the message of the parody at the same time because true parody
is expected to convey the intention of the parodist as well. Even if the parodist has no
relationships with the owner of the original trademark, the parody trademark must havean effect of showing general consumers of the product that it is trying to express themessage of the trademark holder in a humorous way by altering the original trademark.
The judicial precedents in the U.S. and Europe also indicate the necessity for trademark
parody to convey two contradictory messages simultaneously. Secondly, parody must
convey a critical message of the parodist and indicate association between the parody
trademark and the target trademark. Parody must have a comment-making function thatallows the parodist to express a certain level of criticism through parody. Such criticism
must be conveyed to consumers. In this connection, it is necessary to examine the issueof whether the comment-making function of a parody trademark can be used only tomake a comment about the original trademark and whether indirect parody should beviprohibited. In the U.S., judicial opinions are divided. The Supreme Court handed down
a judgment that prohibited such parody by referring to such practice in the field of
copyrights. Other courts handed down judgments to the effect that parody should bepermitted even if the purpose of the parody is to criticize a social situation or simply
to generate laughter. Under the trademark law, unlike the copyright law, indirect parody
is likely to be permitted because it would only allow indirect social criticism while
direct parody, which is more likely to be composed for the purpose of wide distribution,
tends to tarnish the reputation of the original. On the other hand, no consensus has beenachieved as to the categories of different elements of the original trademark (critical,
exaggeration, and cynical functions). The comment-making function of trademark
parody usually takes advantage of the difference between the two marks in terms of themanner of use and achieved its goal by distinguishing the two through communications
containing such elements as cynicism, laughter, joke, entertainment, and joy. Whenmaking a determination as to whether a parody trademark could cause confusion, theintention of the parodist is an important determination factor. However, when making adetermination as to whether a parody trademark satisfies essential requirements forparody, the manner of recognition among consumers is more important than theintention of the parodist. The judicial precedents in major countries show that a parody
trademark was held responsible for trademark infringement or dilution when the parody
trademark failed to correctly convey meaningful information or criticism about thetrademark holder or the trademarked goods. (v) A trademark parody would never bepermitted in either of the following two cases: (1) the case where the sole purpose of
trademark parody is to advertise products or increase the sales by taking advantage ofthe reputation of the famous trademark holder and (2) the case where trademark parody
cannot perform its parody function because the intention and purpose of the parody isunclear.

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