Viacom prevails in SpongeBob SquarePants Trademark Lawsuit

Recently, Viacom, the company responsible for the Sponge SquarePants television show, prevailed in a trademark lawsuit.[1] The dispute resulted from the Defendant’s plans to use the name “Krusty Krab” for a restaurant.[2] The Plaintiff objected and then filed a lawsuit against the Defendant for trademark infringement and other claims under the Federal Lanham Act and common law.[3] The Plaintiff argued that the Defendant’s proposed use of “Krusty Krab” infringed upon its rights since Plaintiff has been using “The Krusty Krab” as the name of a fictional restaurant in the SpongeBob SquarePants television show since 1999.[4] The Plaintiff moved for summary judgment.[5]

The Plaintiff did not have a trademark registration for the term “The Krusty Krab” and relied upon its common law use of the mark.[6] Specifically, the Plaintiff argued that the “The Krusty Krab” mark appeared in 166 of the 203 SpongeBob SquarePants episodes that were aired, and was also depicted in two SpongeBob SquarePants feature films.[7] The Plaintiff also pointed to the fact that it has been selling products and licensing the right to sell products utilizing the term “The Krusty Krab.”[8]

The Defendant argued that the Plaintiff could not obtain trademark rights in the title of a fictional restaurant.[9] The Court disagreed finding that elements of a television show can be protected as a trademark, such as “symbols, design elements, and characters which the public directly associates with the plaintiff or its product.”[10] In support of its reasoning the Court pointed to previous court rulings that the term “Kryptonite,” from the Superman comics, books and movies, can be protected as a trademark, even though it is a “fictional radioactive compound in the Superman series.”[11]

Finding that the Plaintiff had a valid trademark in the term “The Krusty Krab,” the Court moved on to determining whether Defendant’s use of the term created a likelihood of consumer confusion.[12] The Court found that likelihood of confusion existed because consumers would be likely to mistakenly believe that the Defendant’s restaurant is an officially licensed or endorsed restaurant of Plaintiff, which was partially based upon a consumer survey entered into evidence by Plaintiff.[13] As a result, the Plaintiff was granted summary judgment on its claim for trademark infringement.[14] The Court denied Plaintiff’s motion for summary judgment as to its claim for dilution as well as Plaintiff’s other claims for false designation of origin, unfair competition and refusal of registration.[15]

Unless the Defendant decides to appeal the Court’s decision, the Defendant will be prevented from using “The Krusty Krab” as the name of its restaurant. Please contact our office if you have any questions regarding the information in this article.

Daniel Devine, Esq.
Santucci Priore, P.L.
Partner

[1] See, Viacom Int’l, Inc. v. IJR Capital Investments, LLC, Case No. 16-cv-00257 at Docket Entry No. 32 (S.D. Tex. January 11, 2017).
[2] Id.
[3] Id.
[4] Id.
[5] Id.
[6] Id.
[7] Id.
[8] Id.
[9] Id.
[10] Id.
[11] Id.
[12] Id.
[13] Id.
[14] Id.
[15] Id.