The Velvet Underground, a seminal underground rock band from the 1960s, recently filed a trademark and unfair competition lawsuit (link opens to a PDF) against the Andy Warhol Foundation for the Visual Arts. The Andy Warhol Foundation has been licensing an image, which Andy Warhol drew in 1966, for use on various products – the same banana image that was on the cover of the Velvet Underground’s first album, The Velvet Underground and Nico. The complaint by the band demands damages for trademark infringement and unfair competition and a declaratory judgment that states the Warhol Foundation does not have a copyright over the image. This post will look into the issues related to this common law trademark dispute.
If you don’t have the album, run out and buy it right now. I’ll wait. OK, now that you’re back and enjoying songs about singer Lou Reed’s heroin addiction and sexual dysfunction, we can get into the legal issues.
Background
Andy Warhol was Velvet Underground’s manager and producer when he created the famous banana logo. He was paid part of the band’s record label advance for the design, but he never had the image registered at the U.S. Copyright Office. The complaint alleges that Andy Warhol lost his copyright when he did not register the image. This issue can get complicated, because an older version of the U.S. Copyright Act was in place when these events occurred. At the time, failure to register an image with the Copyright Office could result in loss of copyright.
The complaint further states that the image has become part of the public domain for copyright purposes due to its widespread publication. (It is interesting to note that the Supreme Court recently held that Congress has the right to take works out of the public domain and give them copyright protection – this is an evolving and controversial area of law.)
Neither Warhol nor the band ever registered the image with the U.S. Patent & Trademark Office. The band’s lawsuit goes on to claim that the image has “become so identified with the Velvet Underground” that it is “immediately recognize(d) as the symbol of the Velvet Underground” – i.e., a trademark. The band has licensed the image for a CD box set, in advertisements, and used it for live musical performances and Velvet Underground merchandise (including, apparently, vodka – no word on whether they considered VU brand heroin). Essentially, the band claims that the famous fruit has acquired a “secondary meaning” – trademark-speak for “this image is uniquely connected with this band in the eyes of the public.”
What is a Common Law Trademark?
As my faithful readers know, one can still enjoy exclusive rights in a trademark even if it is not registered with the USPTO. Continuous use of a mark in commerce by a business or company may suffice to generate “common law trademark rights,” which allows the trademark owner to sue another party for using the mark in an infringing manner. However, common law rights do not provide all the benefits of trademark registration, such as the ability to recover the infringer’s profits, statutory damages, and attorney’s fees.
The band’s position is that the Warhol Foundation is trying to deceive the public into believing that the band has given approval for the Foundation to use the image. The band’s complaint states that because there are so many Warhol designs the Foundation could have used for these products, using the famous banana image is evidence that the Foundation is using the connection between the picture and the band to capitalize.
How Will The Parties Resolve the Dispute?
Because of the complexities of this case, the issues regarding the old version of the copyright act, and the fact that these issues fall in the narrow grey area between copyright and trademark law, my educated guess is that both sides will spend a lot of money on legal fees and will ultimately settle the case before a court renders a final decision. Once again, the moral is to put agreements in writing, or the result may be costly and challenging. The same rule applies to rock stars, pop art masterminds, small business owners, and independent contractors – get it in writing and work out the legal details before it comes back to haunt you.
