False Endorsement or Protected Speech? Risks of Using Celebrity “News” in Advertising

January 23, 2009 — Two recent disputes involving high-profile music entertainers highlight the controversy over advertising strategies intended to capitalize on current events or celebrity “infotainment.”In June, 2008, Taco Bell released to various media outlets an open letter to hip-hop artist Curtis Jackson p/k/a “50 Cent” inviting him to change his name for a day to either 79 Cent, 89 Cent or 99 Cent.  If Jackson showed up at any Taco Bell store, the letter continued, and rapped his order in the drive thru with his new name, Taco Bell would make a $10,000 contribution to a charity of his choice.  Taco Bell simultaneously had a rap-themed campaign running on its website to promote its “Why Pay More” menu items. Jackson promptly responded by suing Taco Bell in New York Federal Court (Case No. 08-cv-06545, S.D.N.Y.) alleging trademark infringement, false endorsement and trademark dilution under the Lanham Act, as well as violation of his right of publicity under New York law.In his complaint, Jackson claimed Taco Bell’s open letter was no more than a transparent advertisement in which Taco Bell made the hip-hop star the center of its nation-wide campaign and used without consent his name, persona and trademarks to promote its products.  According to Jackson, Taco Bell never sent him the letter directly prior to its public dissemination.  “In guerilla advertising fashion,” the complaint stated, “Taco Bell stole (rather than paid for) the endorsement of mega-celebrity Jackson, and then disseminated it for free through the press (rather than paying for advertising time.)”  Further, Jackson claimed that many of his fans erroneously believed he had agreed to endorse Taco Bell’s products, and criticized him for selling out.  Jackson is seeking in excess of $1,000,000 in damages.Responding to Jackson’s lawsuit in September 2008, Taco Bell criticized Jackson for aggressively distorting its humorous and good faith offer to make a donation to charity if he accepted their challenge.  According to Taco Bell, the public had a right to know about its legitimate and newsworthy charitable offer to Jackson.  Further, informing the public about its celebrity challenge was protected speech and fair use of Jackson’s name and trademarks.  Taco Bell also claimed its request that Jackson temporarily change “50 Cent” to the price of one of its value menu items was nothing more than a “good natured parody” of the rapper’s name.   As of this date, the lawsuit is still pending.In a similar controversy, Guns N’ Roses singer Axl Rose has threatened to sue Dr. Pepper over an allegedly unauthorized promotion involving the band’s long-awaited album “Chinese Democracy.”  In March 2008, Dr. Pepper sent out a humorous press release stating that “In an unprecedented show of solidarity with Axl, everyone in America…will receive a free can of Dr. Pepper if the album ships some time – anytime!-in 2008. Dr. Pepper supports Axl, and fully understands that sometimes you have to make it through the jungle before you get it right.”  In November 2008, Guns N’ Roses released its album, and Dr. Pepper – purportedly attempting to make good on its offer –  posted a coupon on its Web site for a free soda, available to download for only a 24-hour period on the day of the album’s release.  Dr. Pepper’s give-away promotion received such a large response that the site crashed.  Some angry customers mistakenly blamed the band.  In a demand letter through his attorney, Rose claimed that the mishandled promotion reflected poorly on the band and had damaged its reputation.  The band is insisting that Dr. Pepper follow through on its promise to the fans and extend the free offer, issue a full-page public apology in several major newspapers and appropriately compensate Guns N’ Roses for falsely implying a co-promotional relationship and for the unauthorized commercial exploitation of the band’s right of publicity and other intellectual property rights.As did Taco Bell, Dr. Pepper expressed surprise at Rose’s legal threats, claiming that its actions were meant in “fun.”  In a released statement, the company said “We simply commented on the delayed release of Chinese Democracy and openly encouraged the band to release it before the end of the year.”   Unlike the Taco Bell case, however, Dr. Pepper may be helped by the fact that Axl Rose had previously commented favorably on the company’s free-offer, and Dr. Pepper therefore may have an additional defense of implied consent. “We are surprised and very happy to have the support of Dr. Pepper with our album Chinese Democracy as for us this came totally out of the blue,” Rose wrote on the band’s website.The Taco Bell and Dr. Pepper disputes reveal the potential pitfalls when advertisers attempt to characterize a commercial message containing an unauthorized celebrity reference as news or information of legitimate public interest.