Fartman toy pulled after rival company gets wind of infringement

In JCW Investments Inc v Novelty Inc, the US Court of Appeals for the Seventh Circuit has considered and upheld the copyright and trademark infringement claims the plaintiff, JCW Investments Inc - trading as Tekky Toys, asserted against the defendant, Novelty Inc. The court awarded compensatory damages, punitive damages under state law, and attorneys' fees of over $500,000. The claims arose from Tekky Toys' copyrighted and trademarked MEET PULL MY FINGER Fred talking doll - a white, overweight man with black hair and a receding hairline, sitting in an armchair, dressed in a white tank top and blue trousers. Novelty's Fartman plush toy bore essentially the same characteristics - a white overweight man with black hair and a receding hairline, sitting in an armchair, wearing a white tank top and blue trousers. Significantly, two of Fartman's crude and supposedly funny comments when the plush doll's finger was pulled were the same, and spoken in a similar way, as two of Tekky Toys' MEET PULL MY FINGER Fred's crude comments. In the district court, Tekky Toys successfully brought a preliminary injunction and a motion for summary judgment against Novelty based on its allegedly infringing Fartman plush toy. Novelty appealed.

As to the copyright infringement claim, the Seventh Circuit reviewed the district court's grant of summary judgment to Tekky Toys and agreed with the court in all regards. The Seventh Circuit held that:

• Tekky Toys had a valid copyright in Fred;
  
  
• Novelty had access to Fred and expressly copied Fred; and
  
  
• the two talking dolls were so similar that the inference of copying, even without any evidence of access and copying, existed.

Holding that the test for substantial similarity is an objective one, the Seventh Circuit examined the dolls' similarities, such as their crooked smiles, balding heads with a fringe of black hair, large protruding noses, blue trousers and white tank tops. The minor differences, such as different colours used for their shoes and chairs, and that Fartman wore a hat, did not change the fact that both dolls gave:

"off more than a similar air. The problem is not that both Fred and Fartman have black hair or white tank tops or any other single detail; the problem is that the execution and combination of features on both dolls would lead an objective observer to think they were the same."

In summary, the Seventh Circuit expressly noted that it was not protecting the idea of a farting, crude man, but the "particular embodiment of that concept". It pointed to a different farting toy Tekky Toys produced, a Frankie doll, to support its conclusion that Fartman was a copy of Fred.

As to the trademark infringement claim, the Seventh Circuit affirmed that Novelty's use of the phrase 'Pull My Finger' to sell its dolls infringed the MEET PULL MY FINGER trademark Tekky Toys owned and used for its plush toy. Under Illinois common law, this infringement allowed for an award of punitive damages. While Novelty argued that the Lanham Act pre-empted the common law state claim for punitive damages, the Seventh Circuit held that although the Lanham Act does not allow for a penalty such as punitive damages, it does not preclude an award of punitive damages under state law. An award of punitive damages does not undermine the policies underlying the Lanham Act. To the extent state law applies, state law remedies also apply. Following case law on attorneys' fee awards in Lanham Act cases from the First Circuit and the Eighth Circuit, the Seventh Circuit held that in trademark law pre-emption is the exception rather than the rule. Thus, the Seventh Circuit affirmed the district court's decision to award over $500,000 in punitive damages under state law as well.

Rochelle D Alpert, Morgan Lewis, San Francisco