Hi, and welcome back to Legal Geek. This week, we celebrate Halloween with a review of a recently-filed lawsuit over Vampire drinks, and we don't mean blood.
Happy Halloween everyone, and I hope you find plenty of treats and not many tricks. In the legal world, we have many tricks up our sleeve, including reverse confusion in trademarks. But before we bite into that concept in detail, let's explain the conflict leading to the case we're covering today.
Vampire Family Brands is a California company that has sold Vampire-branded wine since 1988. In the 3 decades of operation, Vampire has extended itself into other fields including Vampire Taco and Vampire Gourmet Bloody Mary Cocktails. Nothing is more on brand than using Vampire for a bloody mary, after all. Vampire has sued the owners of the Applebee's brand and their major franchisees for alleged trademark infringement.
Applebee's restaurants introduced a $1 cocktail called the Vampire cocktail this month, a drink that is a Tiki beverage consisting of rum and various fruit drinks, served with a plastic set of vampire fangs. This is being done as a loss leader to bring in customers to purchase meals at Applebee's, and Vampire Family Brands did not take kindly to this invasion of their dark-themed liquor space. So this lawsuit was filed claiming that Applebee's is infringing the Vampire trademark in this endeavor.
The legal theory of the case is what is known as reverse confusion. Unlike regular consumer confusion, where a usually-smaller startup infringes the branding of a more established company that has built up consumer goodwill in the brand, reverse confusion is defined by having a powerful entity upstart that threatens to link itself to a smaller pre-existing brand. In other words, Applebee's, the new kid on the block to Vampire drinks, has large resources to market and advertise to consumers, which may lead to the consumer confusion that Vampire Family Brands is an unauthorized user of trademarks that the bigger company Applebee's owns.
Vampire Family Brands does have several federal trademark registrations on various glassware and food and beverage products, including restaurant and bar services. This entitles them to a presumption of nationwide rights and that means a valid case can be made against Applebee's here. That being said, the alcoholic drink itself is not identical to anything Vampire Family Brands has registered as a covered good or service, nor is the Tiki drink identical to anything Vampire Family Brands offers. That gives Applebee's a counterargument to make, but the Vampire drink is really being used to promote restaurant and bar services, which is covered by a live registered trademark. The facts seem to favor the small company Vampire, so perhaps Applebee's will have to submit to a settlement here to avoid being put in a casket of damages.
The Bottom Line is: October never fails to give us a good spooky themed legal case, and this year it is a battle of Vampires that Bram Stoker would be proud of. This proves the importance of big companies doing some clearance research before launching big marketing campaigns and new brands, as the Vampire trademarks would have been readily apparent upon a quick search of the US trademark database. Applebee's could've avoided hot water here, but maybe they will find a wooden cross or silver dagger to save them in this legal fight.
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