It’s hard out there for small businesses these days. Especially for new pop-up coffee shops. How can they expect to compete with coffee moguls like Starbucks? Well, here’s one idea: don’t compete. Why not use what already works? That was the idea behind “Dumb Starbucks” — a small coffee shop that opened its doors for business in 2014. Their model was simple: use the exact same logo and branding as Starbucks so people would walk in thinking it was just another branch of the well-established chain. To any sane person this might seem like a one-way ticket to a fat lawsuit. But under the legal principles of Fair Use, Dumb Starbucks was confident they could get away with the impossible.
Dumb Starbucks was the brainchild of comedian Nathan Fielder. He conjured up the idea for his Comedy Central show Nathan For You — a mock-reality TV series that proposes wild marketing ideas for small businesses to help them achieve financial success. Dumb Starbucks is perhaps his most legally ambitious scheme to date. They used the same logo and menu items as Starbucks but with one key difference. The word “dumb” appeared in small font before the name of the store and every product. Dumb Venti Latte. Dumb Mocha Frappuccino. Dumb Cake Pops. Dumb Nora Jones CDs. Everything was Dumb.
Fielder contended that “By adding the word ‘dumb,’ we are technically ‘making fun’ of Starbucks, which allows us to use their trademarks under a law known as ‘fair use.’” Fair Use is defined as “any copying of copyrighted material done for a limited and ‘transformative’ purpose, such as to comment upon, criticize, or parody a copyrighted work.” Using copyrighted material in this way can be done without the copyright owner’s permission. If you were being sued on the claim of copyright infringement, Fair Use could be a strong defense in your case. It certainly provided Fielder with the courage to carry out his seemingly perilous plan.
The nebulous scope of the word “transformative” allows for a lot of flexibility in how this law can be interpreted by a judge. Fielder’s “transformative purpose” was that Dumb Starbucks essentially operated as a Parody Art Gallery, not as a business selling food and drinks. Fielder therefore maintained that they didn’t need the required license and permits to operate like a real Starbucks would. During the episode one customer asks, “Who is responsible if something is dirty and I get sick?” to which Fielder responds “Technically, if you do get sick, it would be considered part of the artistic experience.”
Legally, Dumb Starbucks presented several interesting issues.
First, it’s important to differentiate between copyright law and trademark law. Both fall under intellectual property law but with several key differences. A copyright “protects original works of authorship including literary, dramatic, musical and artistic works, such as poetry, novels, movies, songs, computer software, and architecture.” A trademark, on the other hand, is defined as a “word, phrase, symbol, and/or design that identifies and distinguishes the source of the goods of one party from those of others.” For example, the Prince song “When Doves Cry” is protected as a copyrighted work, while the Nike “Swoosh” symbol is protected as a trademark.
In 1994 a seminal Supreme Court case ruled that “Parody, like other comment or criticism, may claim fair use.”This resulted from a lawsuit alleging that 2 Live Crew’s song “Pretty Woman” infringed upon Roy Orbison’s rock ballad “Oh Pretty Woman.” The Court granted summary judgment for 2 Live Crew, finding that their song was “a parody that made fair use of the original song.” Subsequently, a Fair Use defense under copyright law is on solid footing.
Trademarks, however, don’t provide the same kind of legal bulwark for parodies under fair use. Litigation columnist Erin Fuchs observes that “In trademark cases, judges are primarily concerned with whether an entity’s use of another company’s trademark could confuse consumers.” Dumb Starbucks might have a viable argument that the likelihood for a consumer to confuse the two companies is minimal due to the word “dumb” being displayed everywhere. Nevertheless, the experienced intellectual property counsel at Starbucks might argue that the parody project is diminishing their unique symbol under the “trademark dilution” doctrine. Trademark dilution is defined as “The use of a mark or trade name in commerce sufficiently similar to a famous mark that by association it reduces, or is likely to reduce the public’s perception that the famous mark signifies something unique, singular, or particular.” Starbucks’ lawyers could argue that the Dumb Starbucks’ use of their trademark tarnishes the essence of their logo or causes confusion to consumers. On those grounds, they would likely secure a judgment in their favor.
Mark McKenna, a law professor at the University of Notre Dame who specializes in trademark law, offered his opinion to USA Today in 2014 saying “My gut tells me a court would be bothered by how much of the Starbucks trademark was used. It’s not just the word but they also made the store look just like it.” Perhaps he’s right. Dumb Starbucks was never actually taken to court, but it is interesting to consider what legal ramifications would have followed if the case was properly litigated.
Nathan Fielder’s simultaneously cunning and inane gambit to sell coffee under the Starbucks logo has generated a fair amount of legal speculation since 2014. Ultimately, Dumb Starbucks was shut down by the Los Angeles County Board of Health after being open for only a week. It didn’t last long enough to show its hand in a court of law. In the end, one could say the victory of Dumb Starbucks was that they got away with a patently absurd idea and avoided a potentially crippling lawsuit from one of the country’s largest coffeehouse chains. And that’s certainly something to celebrate.
And finally, as we always say, “If you think you might need an attorney, you probably do.” Contact us before anything is set in stone. We love answering questions!
By Lance Huckabee, Legal Assistant at Morris Law Center, Baccalaureate of the University of Arkansas Little Rock and graduate of the School for International Training.
 Stim, Richard. “What Is Fair Use?” Stanford Copyright and Fair Use Center. April 11, 2017. Accessed February 28, 2019. https://fairuse.stanford.edu/overview/fair-use/what-is-fair-use/.
 “Trademark, Patent, or Copyright?” United States Patent and Trademark Office – An Agency of the Department of Commerce. Accessed February 28, 2019. https://www.uspto.gov/trademarks-getting-started/trademark-basics/trademark-patent-or-copyright.
 Campbell v. Acuff-Rose, (92-1292), 510 U.S. 569 (1994)
 Fuchs, Erin. “Why ‘Dumb Starbucks’ Is Probably Illegal.” Business Insider. February 10, 2014. Accessed February 28, 2019. https://www.businessinsider.com/is-dumb-starbucks-legal-2014-2.
 “Dilution (Trademark).” Legal Information Institute. March 14, 2015. Accessed February 28, 2019. https://www.law.cornell.edu/wex/dilution_(trademark).
 Lee, Jolie. “Starbucks Responds to Dumb Starbucks in L.A.” USA Today. February 11, 2014. Accessed February 28, 2019. https://www.usatoday.com/story/news/nation-now/2014/02/10/dumb-starbucks-parody-free-coffee/5357597/.