Collegiate Merchandising Dodges a Bullet

A Pennsylvania federal jury, in a landmark case entitled THE PENNSYLVANIA STATE UNIVERSITY, Plaintiff, v. VINTAGE BRAND, LLC; SPORTSWEAR, INC., d/b/a PREP SPORTSWEAR; CHAD HARTVIGSON; ERIKHARTVIGSON; and MICHELLE YOUNG (M.D.Pa. 2024), found that Penn State was able to enforce its merchandising rights against an infringer, Vintage Brands and the print-on-demand company Prep Sportswear who had been selling a line of unlicensed products which used “historical” images of the Penn State logo often taken from old sports memorabilia. The decision marks a significant win for universities and sports teams as well as other merchandise property owners in their fight to protect against the sale of unlicensed merchandise.

Penn State accused the defendants of using its trademarks, including its name, iconic “Nittany Lion” shrine imagery, and an old university seal, on unlicensed products such as shirts, hats, and coasters. It argued that Vintage’s of these historical images undermined the integrity of its brand and deprived the university of licensing revenues.

Vintage Brand argued that its website clearly stated that it was not affiliated with or endorsed by Penn State, making it unlikely for consumers to be confused. It also contended that Penn State had not asserted quality control over historical images and were no longer using the historical versions of their mark.

The jury found that Vintage Brands was a willful infringer and awarded Penn State monetary damages in the amount of $28,000.

Vintage Brands had previously engaged in similar practice using the historical images of other college logos but had reached settlement agreements with the other colleges and universities, including Baylor University. When they were unable to settle the case with Penn State, a trial on the merits was held on and Penn State prevailed. They have also marketed products bearing former logos of MLB, the NBA and the NFL.

The case had much broader implications for trademark licensing for several reasons, most notably that trademark owners have rights to brands, regardless of their age or continuing use, and can enforce them against unlicensed users. It also put to rest a theory expressed by the trial judge in an earlier order that questioned the validity under the trademark law of using a trademark on licensed products when he stated:

• Ultimately, these are legal issues to be decided another day. Still, the discussion should focus the parties’ minds on the issues to briefed in future motions. And it should highlight a few essential questions that cannot, at summary judgment, be answered through mere supposition: Indeed, what percentage of consumers are confused about the source or sponsorship of Vintage Brand’s products? Does this belief vary by logo or merchandise type? And does it stem from their belief that the law requires Penn State’s permission? The modern collegiate trademark and licensing-regime has grown into a multibillion-dollar industry. But that a house is large is of little matter if it’s been built on sand.

That language had created a furor among trademark owners and attorneys because of its industry wide implications. It looks as if the jury got it right and hopefully, the judge won’t decide to overturn their award.