Supreme Court Declines to Review Brandy Melville Trademark Suit

Meghan Hall
·6 min read

A Gen Z favorite couldn’t provide a compelling enough reason for the Supreme Court to agree to a review of a trademark-related lawsuit it initially filed in 2019.

Nearly five years ago, fast-fashion retailer Brandy Melville sued Redbubble for contributory trademark infringement, among other charges. In 2021, a jury found the Australian print-to-order company guilty of contributory trademark infringement.

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Scott Hervey, an entertainment, intellectual property and business attorney at Weintraub Tobin in California, explained that, when an entity is under fire for contributory liability, it means they may not be the one violating a trademark, but their platform assists and allows for the proliferation of violations.

“It’s a form of secondary liability, where a party can be held liable for infringement, even though they did not actually engage in that infringing conduct,” he explained.

After being found guilty, Redbubble appealed. The U.S. Court of Appeals for the Ninth Circuit reviewed the case and overturned the previous judgment, thereby nullifying the Los Angeles-based retailer’s win over the digital platform because the lower court had not used the Ninth Circuit’s legal standard for contributory trademark infringement.

That decision cited legal precedent from previous cases that interpret the meaning of the Lanham Act, which is a federal statute that governs trademark law.

In the landmark case, Inwood Labs, Inc. v. Ives Lab, Inc.—more commonly known as Inwood—the Supreme Court ruled that contributory trademark infringement occurs when a defendant aids another party “whom it knows or has reason to know is engaging in trademark infringement.”

In the Brandy Melville case, the company alleged that Redbubble had participated in contributory trademark infringement because the platform had, allegedly, continuously allowed products with the Brandy Melville name, logo and trademarks on them to be hawked by its sellers. According to counsel for Brandy Melville, that pattern persisted even after the company notified Redbubble that such items existed on the platform and none of them had been licensed by the company itself.

But, in the end, the Ninth Circuit court ruled that the e-commerce platform had not committed contributory trademark infringement because it was only required to be liable for the specific instances of alleged infringement that Brandy Melville pointed out.

Because of that ruling, Brandy Melville escalated its concerns to the Supreme Court. The company filed a petition for writ of certiorari on Jan. 9. The Supreme Court denied the petition on Tuesday.

According to the petition, other circuit courts—the Second and Tenth Circuits—have put forth different judgments on a similar issue.

“In these circuits, once a defendant knows or has reason to know that it is assisting trademark infringement (even if it does not know or have reason to know of ‘specific’ instances of infringement or infringers), it has a legal duty to take reasonable steps to stop rendering such assistance,” the petition noted.

One of the two cases the petition references, ruled on in the Second Circuit, found a landlord guilty of leasing a property to a tenant who the landlord knew was selling counterfeit Omega watches.

The varying judgments from different circuit courts served as the crux of Brandy Melville’s petition for the Supreme Court to review the case against Redbubble. According to the company’s filing, the Supreme Court “has not considered the standard for contributory trademark infringement under the Lanham Act since announcing that standard in 1982.”

It argued that the Ninth Circuit’s decision “created a circuit split, but manifestly placed itself on the wrong side of that split.”

Hervey said a circuit split occurs when courts ruling on similar issues create vastly different sets of rules as part of their decisions.

“What ends up happening in circuit splits is you’ve got different courts of appeal that…come up with a completely different way to analyze the same or similar fact patterns,” he explained.

That, counsel for Brandy Melville wrote, could “[provide] incentives for facilitating widespread trademark infringement” among e-tailers in the future, giving other companies who pursue legal actions on the same premises within the Ninth Circuit a shoddy leg to stand on.

“The rise of global digital platforms like Redbubble’s opens the door to trademark infringement on an almost unimaginably large scale. Such services profit enormously from enabling such infringement, and indeed their business model may depend on it,” counsel wrote in the petition. “A rule like the Ninth Circuit’s, where only failing to act on specific instances of infringement brought to the service provider’s attention gives rise to liability, will tremendously increase the scope of online infringement.”

Earlier in its petition, Brandy Melville noted it had serious issues keeping up with the rate at which items appeared on Redbubble allegedly infringing on its trademarks.

“Redbubble removed specific images identified in [a letter sent by Brandy Melville] and invited Brandy Melville to notify it of any other ‘specific’ images that it would like removed. Although Brandy Melville subsequently notified Redbubble of infringing images, following that process was like playing a game of Whack-a-Mole: some listings would come down while others would pop up.”

Hervey said he expects that the “Whack-a-Mole” approach the petition cites will only continue if brands continue to file similar cases in the Ninth Circuit. Because that court’s decision seems less favorable for brands looking for action or a payout, he said, it’s likely that the difference in opinion between courts will cause venue shopping.

He noted that though this particular case is now settled, if Brandy Melville chooses to sue Redbubble over any future contributory trademark infringement issues, it would be likely for the company to take its case to New York, where it might receive more favorable treatment under the precedent set by previous cases tried in the Second Circuit.

“I think it means that brands like Brandy Melville, or Atari, [which] also sued Redbubble, they’re going to have to think about where they sue. They’re probably going to sue in the Second Circuit as opposed to the Ninth Circuit,” Hervey told Sourcing Journal. “And if for whatever reason they can’t sue in the Second Circuit, and are limited to the Ninth Circuit, they’re going to have to just deal with a Whack-a-Mole approach.”

Ultimately, he said, businesses that rely on a marketplace-style platform, like Redbubble or Temu, will need to ensure they know their sellers’ reputations and know the products being sold on the platform.

Simultaneously, as e-commerce platforms continue to grab U.S. consumers’ attention, brands will have to remain on the lookout, Hervey said.

“If you are the brand, you’ve got to be vigilant. You’ve got to be vigilant in protecting your brand, vigilant in making sure that you’re doing as best you can to prevent counterfeit goods from being sold, vigilant in taking action against the sellers of counterfeit goods and those platforms or facilities that allow the sale of counterfeit goods,” Hervey said.

Brandy Melville and its counsel did not return requests for comment, nor did Redbubble and its counsel.