First Amendment Protects Video Game Parody from California Unfair Competition Law Claim

This posting was written by Jody Coultas, Editor of CCH State Unfair Trade Practices Law.

A strip club operator did not state a California Unfair Competition Law (UCL) claim against the maker of Grand Theft Auto: San Andreas, a video game that featured a cartoon parody of the club, according to the Ninth U.S. Circuit Court of Appeals in San Francisco.

The video game mimicked a Los Angeles neighborhood, complete with variations on the business names and architecture located in that neighborhood, including the club's logo and trade dress.

Artistic Relevance, Misleading of Consumer

The video game company successfully argued that the First Amendment protected its use of the cartoon rendering of the L.A. club. An artist's use of a trademark violated the unfair competition law only where the use of the mark had no artistic relevance whatsoever, or where the use explicitly misled the consumer as to the source or content of the work, according to the court.

In this case, the video game company's artistic goal was to create a cartoon parody of East Los Angeles; thus, creating a strip club in the game with the same look and feel as the actual strip club had at least some artistic relevance.

Although the strip club argued that the video game explicitly misled consumers as to the source of the work, the court found that no reasonable consumer would confuse the strip club in the game with the actual strip club.

Threat of Confusion

In enacting the UCL, the legislature sought to avoid confusion in the marketplace about the origins and sponsorship of products. Here, the court concluded that the strip club in the game was merely incidental to Grand Theft Auto's overall story line and the actual setting in the game was fairly generic. Besides offering a form of low-brow entertainment, the video game and strip club had nothing in common and Grand Theft Auto: San Andreas posed no threat of customer confusion, concluded the court.

Trademark, Trade Dress Claims

The strip club operator’s trademark infringement and trade dress claims were rejected on findings that the video game maker’s use of the strip club’s trademark and trade dress bore some artistic relevance to the game and did not explicitly mislead consumers as to the source or content of the game. The buying public would not reasonably believe that the club operator produced the game, or the game maker operated the club, according the court.

The November 5 decision is E.S.S. Entertainment 2000, Inc. v. Rock Star Videos, Inc., CCH State Unfair Trade Practices ¶31,688, CCH Trademark Law Guide ¶61,327,and CCH Guide to Computer Law ¶49,625.