Turn that Frown Upside-Down

February 1, 2018

Grumpy Cat is one of the most famous cats on the internet. She is known for her scowl that has provided countless funny memes on the internet. Grumpy Cat has appeared in major television shows, starred in a movie, and is associated with various books that debuted on the New York Times bestsellers list.  She also has the honor of having her own animatronics wax figurine at Madame Tussauds. Her celebrity has resulted in the formation of Grumpy Cat Limited that sells various goods and services such as apparel, calendars, toys and other memorabilia as part of the Grumpy Cat brand. Grumpy Cat Limited owns intellectual property rights to Grumpy Cat’s name, image, and likeness. The company has several copyright and trademark rights protecting the image and use of “Grumpy Cat,” and recently found itself defending its intellectual property right in court.

 

Back in 2013, Grumpy Cat Limited entered into a licensing agreement with Grenade Beverage. Grenade Beverage is a US coffee company that produces, manufacturers, markets and distributes various drinks. The licensing agreement allowed Grenade Beverage to use Grumpy Cat’s name and image to launch Grumpy Cat branded coffee products called “Grumpy Cat Grumppuccino” in exchange for a monetary advance and royalties.

 

In 2015, Grumpy Cat Limited became aware of Grenade Beverage’s intent to launch a new Grumpy Cat branded roasted coffee product distinct from the Grumpy Cat Grumppuccio line. As per required by the licensing agreement, Grenade Beverage asked for prior approval to use their license to launch their new product line. However, Grumpy Cat Limited claimed that it never provided approval as required by the license agreement and stated that it repeatedly told Grenade Beverage that they could not use the Grumpy Cat image or mark to launch their new line. Despite not getting approval from Grumpy Cat, Grenade Beverage advertised and sold their new line of Grumpy Cat roasted coffee ground products marketed as “Grumpy Cat Roasted Coffee.”

 

In response to the alleged unauthorized use, Grumpy Cat Limited brought suit alleging copyright infringement, trademark infringement, trademark dilution, cyber-squatting, breach of contract, and accounting issues. Grumpy Cat Limited claimed that Grenade Beverage infringed their intellectual property by selling and advertizing their “Grumpy Cat Roasted Coffee” products without approval, selling “Grumppuccinno” t-shirts outside of the scope of the license agreement, violating the license agreement by failing to provide accounting information, failing to pay royalties, obtaining rights and ownership to www.durnkgrupycat.com and www.grumpycat.com to further “their unauthorized use and exploitation of the Grumpy Cat Copyrights and Grumpy Trademarks.

 

Grenade Beverage filed their own counterclaim against Grumpy Cat Limited. They argued that Grumpy Cat Limited breached the license agreement by not approving the new product line. Also, they argued that they own rights to Grumppuccino brand and are within their rights to sell products associated with mark. Moreover, Grenade Beverage claimed that the new entity created under the license agreement, Grumpy Beverages, L.L.C. is the rightful owner of the domain names and websites in question. Adding further, Grenade Beverage argued several other claims such as negligent misrepresentation, breach of fiduciary duty, breach of contract, breach of the covenant of good faith and fair dealing, intentional interference with contractual relations, and intentional interference with prospective economic advantage.

 

The case proceeded to trial where a jury found in favor of Grumpy Cat and awarded the plaintiffs over $700,000 in copyright and trademark damages. While, there may not be an amount of money that can make Grumpy Cat smile, it will undoubtfully bring joy to her owners and the Grumpy Cat Limited company. The lesson here is do not mess with Grumpy Cat!

Image source: Reuters/Danny Moloshok

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