Starbucks Not So “Dumb” After All

Last weekend in Los Feliz, Los Angeles, it appeared that coffee mogul Starbucks opened a new franchise. However, this new store proudly named itself “Dumb Starbucks,” and every menu item was preceded by the word “dumb.” Patrons could order Dumb Honey Blonde roast coffee or Dumb Chai Lattes, to name a few, in size Dumb Tall, Dumb Grande, or Dumb Venti. Oddly enough, Starbucks has decided not to go after the perpetrator of this stunt, Nathan Fielder, the host of the Comedy Central show “Nathan For You.”

Los Angeles County health inspectors shut the store down for operating without a valid permit, although Fielder later protested that the store was an art gallery, and therefore the coffee they gave away free of charge was also “art.” Starbucks would have had a strong case for trademark tarnishment, but not for dilution. Although Haute Diggety Dog defeated Louis Vuitton’s suit for trademark dilution and tarnishment, Dumb Starbucks would not be able to defend itself in court against Starbucks here, at least on tarnishment. The Fourth Circuit held that Haute Diggety Dog’s line of “Chewy Vuitton” dog toys was a successful parody, because it would not cause confusion with Louis Vuitton’s well-known products, and the supposed choking hazard the toys presented for some dogs was not enough to show tarnishment.

Here, Starbucks has a clearer case of tarnishment, given that every use of its name, products, and trade dress was preceded by the word “dumb.” Dilution is probably not present, because there was only one parody shop. Also, while the shop was open people strongly suspected the real Starbucks was not responsible and instead guessed at who was behind the stunt. The claim of tarnishment would also make dilution more difficult to prove – because Starbucks does not want its name or product maligned its public relations team would clearly denounce the parody shop, and so consumers would not be confused as to the source of “Dumb Starbucks” and mistakenly attribute it to the real company.

Starbucks’ decision not to go after Fielder was intelligent, rather than dumb. The legal requirements of tarnishment may have been met, but Starbucks would have harmed its own reputation much more if it brought suit. Starbucks would have been viewed as a bully that couldn’t take a joke, because the prank was short-lived, and Fielder did not profit from giving away free coffee. Instead, Starbucks got some free advertising, similar to the way knock-offs of luxury goods advertise the real goods. The coffee served by Dumb Starbucks was of questionable quality (perhaps as part of the joke), which may also increase interest in the real thing. Consumers will also view Starbucks in a better light for allowing the issue to blow over on its own. Fielder jokingly said he considered opening another branch of Dumb Starbucks in Brooklyn, New York. If he does open another branch Starbucks will probably take action (and should to protect its trademarks and reputation). Starbucks may still hesitate given that its trademark infringement claim against Charbucks failed in 2009, and that courts vary in their incorporation of the fair use defense from copyright law to trademark law.

It is unclear whether Starbucks’ decision not to sue Fielder will lead other companies to allow one-shot “pranks” such as this to occur without repercussions. Such action will likely depend on the nature of the future pranks and whether they are harmful and widespread. Notably the consumers of Dumb Starbucks coffee were left completely alone, so hopefully any future events like this will not have serious implications for consumers, whatever effect they may have on the people responsible.

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