In 2000 Starbucks Corporation sued comic book artist Kieron Dwyer for copyright and trademark infringement of its logo. Dwyer’s parody of the Starbucks mermaid logo appeared on the cover of issue zero of Dwyer’s self-published comic book Lowest Comic Denominator. Attorneys for Starbucks discovered parody on the LCD website, where Dwyer also sold t-shirts, stickers, and coffee mugs bearing the parody logo.

Before publishing issue zero of LCD, Dwyer consulted Andy Gold, an intellectual property lawyer in San Francisco. Gold informed Dwyer that his parody logo was social satire that was as legitimate as an editorial cartoon and advised Dwyer that he might receive a cease-and-desist letter from Starbucks. Neither LCD’s modest print run nor the relatively low availability of merchandise bearing the parody logo gave Gold and Dwyer reason to expect the reprisal that came from Starbucks.

Rather than sending a cease-and-desist letter, Starbucks filed a motion for a restraining order that required Dwyer to surrender all items bearing the parody logo. Further, Starbucks demanded the removal of the parody logo from Dwyer’s website. After learning of Starbucks’ suit, Gold responded, “It’s like carpet-bombing an anthill. Clearly, they expected Kieron to roll over and play dead.” The fact that Starbucks sought attorneys’ fees in addition to all revenue generated by LCD and related merchandise annoyed Gold further. “Their lawyers must have billed Starbucks twenty or thirty thousand dollars just preparing the lawsuit, when all they had to do was pick up the phone and call Kieron.”

When Starbucks’ motion for a preliminary injunction was brought before Judge Maxine Chesney, Gold successfully argued that the logo was parody and therefore protected speech under the First Amendment. Because it is protected speech, the parody logo did not infringe on Starbucks’ copyright.

However, Gold had less success concerning trademark infringement. He argued that the parody logo did not violate Starbucks’ trademark because Dwyer does not manufacture or sell coffee and is not a commercial competitor of Starbucks. He further argued that people would not associate the parody logo with Starbucks because the logos significantly differ.

Starbucks countered that the parody logo and other images on Dwyer’s website tarnish the Starbucks trademark. Dwyer does not use Starbucks’ name or a pun based on the company’s name in his parody logo, but Judge Chesney found that Dwyer’s parody logo was “confusingly similar” to the Starbucks logo. Further, she found that the use of the phrase “Consumer Whore” in the parody logo could be considered offensive and thereby tarnished the Starbucks trademark. She also found that the sale of merchandise bearing the parody logo constituted trademark infringement.

Concerned by the financial impact of a legal fight with Starbucks, Dwyer ultimately decided to settle the case out of court. Dwyer was allowed to continue displaying his logo but such display was very narrowly restricted. The logo could not appear on comic books, t-shirts, or stickers. Dwyer could post the image on the Internet but not on his own website nor may he link his website to any other sites that show the parody logo. In short, Dwyer is permitted to use the logo as long as Starbucks can be confident that no one will see it.