Is "Dumb Starbucks" Free Speech or Just a Dumb Ploy Inviting a Lawsuit?

A new coffee shop has opened in Los Feliz, Los Angeles, titling itself "Dumb Starbucks."  The mock coffee shop utilizes a virtually identical logo to Starbucks' logo on all its products and signage, but places the word "Dumb" before everything.

According to news reports, the owners are claiming that their coffee shop is some kind of "pop art" installation intended to mock the massive Starbucks corporation.  They apparently claim that they are shielded from liability for trademark infringement or dilution by the First Amendment, and that their lawyers are fully in control of the situation.

Notably, the news reports also claim that their coffee is not for sale, but is handed out free of charge, which would tend be garner some sympathy for the argument that the whole excursion is a non-commercial artistic endeavor. However, the "FAQ" disclosed by the owners seems to suggest that the coffee is very much for sale.  It states, in relevant part:

"Although we are a fully functioning coffee shop, for legal reasons Dumb Starbucks needs to be categorized as a work of parody art. So, in the eyes of the law, our "coffee shop" is actually an art gallery and the "coffee" you're buying is actually the art. But that's for our lawyers to worry about. All you need to do is enjoy our delicious coffee!"

But what does that matter?  Under the federal Lanham Act, there is a requirement that the unauthorized use be "in commerce" to be considered an infringement. The Federal Trademark Dilution Act does not expressly contain such a commercial use requirement, but it would certainly be relevant to a court's consideration if the whole stunt has no commercial element.

Rather, here, it would appear the entire endeavor is a publicity stunt essentially inviting the Starbucks' chain to file a lawsuit. Even if Starbucks won, it might lose in the court of public opinion, for looking like it has no sense of humor. So the owners may be taking an expensive gamble.

That being said, Starbucks Corporation is inevitably going to be forced to sue this particular coffee shop, and the odds are that it will likely prevail in shutting it down in very short order. Perhaps that is the reason that news reports that there is a several hour wait to enter the shop.

Starbucks Loses Big Against CHARBUCKS in the Court of Appeals

Starbucks lost a significant trademark appeal before a panel of three judges of the U.S. Court of Appeals for the Second Circuit in a case that it had brought against a small coffee shop that had named itself "CHARBUCKS".

Starbucks had filed a trademark infringement and dilution suit in federal court in New York against Black Bear Micro Roastery, which is operating a "CHARBUCKS"-named coffee shop in Tuftsboro, New Hampshire.

Starbucks' legal claim rested almost entirely on the theory that the play on the word STARBUCKS by  Black Bear constituted dilution by blurring.

Blurring is a species of trademark dilution that does not require that consumers are confused into thinking that the Plaintiff makes, endorses or sponsors the Defendant's products or services, but merely that the unauthorized use is likely to "blur" the mark's distinctive quality.

Blurring is distinct from the tarnishment theory of dilution, which seeks to determine if the famous mark is being called into disrepute by association with unsavory themes or words.

After a two day bench trial, the District Court rejected Starbucks' evidence, and found that the Defendant's use was not likely to blur the fame or distinctiveness of the famous Seattle coffee brand.

Starbucks subsequently appealed, and this week, a panel of three judges unanimously agreed that Starbucks had failed to carry its burden of proof at trial.  Starbucks has said that it respects but disagrees with the panel's decision.  Starbucks may seek review by the entire Circuit Court, in a rare but not unprecedented legal maneuver.