If you’ve been on the internet in the last five years or so, you are likely familiar with “Grumpy Cat™”. This cat’s grumpy mug has stood in for our daily frustrations in so many contexts.
It will become readily apparent later in the article why a picture of Grumpy Cat™ is not used here.
With the ubiquity of Grumpy Cat’s grumpy mug, it probably wouldn’t surprise you to hear that Grumpy Cat™’s owner has filed a trademark on the cat’s likeness. It’s just good business when you own probably the most famous cat in cyberspace.
What does this have to do with my business?
Now, most of us get trademarks to capitalize on ideas and products we have rather than the accidental fame of our furry friends. When we want the brands we’ve built to expand beyond what we make ourselves, we license those marks to others. And therein lies the connection between Grumpy Cat™ and your business.
So what was licensed?
Grumpy Cat™’s owner, Tabatha Bundesen, licensed the Grumpy Cat mark to Grenade Beverage for the creation of Grumpy Cat™ Grumppuccino, an iced coffee. The deal was expected to be lucrative, Grenade paid $150,000 in upfront royalties.
What happened to this great deal?
And here we come to every business’s least favorite phrase: Lawsuit. Grumpy Cat Ltd. sued Grenade Beverage over alleged misuse of the Grumpy Cat trademark. In addition to the authorized iced coffee, Grenade apparently made additional Grumpy Cat™ coffee grounds and a line of Grumppuccino t-shirts.
And of course, what’s a good lawsuit without a countersuit? Grenade Beverage countersued saying that the actions of Ms. Bundesen and Grumpy Cat Ltd. wrecked the hype for the Grumppucino launch by leaking early product images that were not ready for the public and not working a slogan for the Grumppuccino into an interview Ms. Bundesen did with Fox and Friends.
What happened with the suit?
A jury sided with Grumpy Cat™. The jury awarded Grumpy Cat Ltd. $710,000 for copyright and trademark infringement.
What’s the moral to this lawsuit?
First, always file for trademarks or copyrights when you are eligible. Federal intellectual property law grants you “statutory damages” even if you can’t prove an exact amount of financial harm caused by someone else using your mark. For Grumpy Cat™, those statutory damages were almost three-quarters of a million dollars. Without registration, that’s money you are leaving on the table.
Secondly, always make sure you have a clear understanding, in writing, when handling the licensing of intellectual property. If it’s your property, you have a duty under IP law to protect your IP or give up the rights you get by registering that IP. If you let others just make whatever they want with your mark, that’s not protecting it. And if you’re the guy licensing someone else’s mark, this story should give you 710,000 reasons why you should be sure you’re staying within what they gave you the right to do.
Have an idea or product?
Do you have a business idea or product you want to market? Is your cat, dog, or guinea pig the most adorable and sure to be the next big internet phenom? Protect yourself now and trademark your brand. Contact A.T. Keane Law today. I’ll help you decide what the best next move is to build and protect your brand, your business, and your product. Don’t be the person who leaves $710,000 on the table.
Want to know more about the Grumpy Cat™ case?
NPR ran an excellent article discussing the events that led to the Grumpy Cat lawsuit.
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