Lost Surfboards dealt staggering blow in Lady Gaga lawsuit

Biolos and co. on the ropes.

It’s not that I’m always right—it’s that I’m paid to be right, and I do my level best to make being right a regular habit of mine.  

To this point, the Court’s order on Lost’s motion for preliminary injunction was just issued in the Lost v. Lady Gaga lawsuit (if you’d like a more complete explanation of the background of this lawsuit and what a motion for preliminary injunction is, read my original article).

TLDR version: Lost’s Motion is DENIED, and Judge Olguin has telegraphed to Lost that he intends to dismiss this case before a trial even occurs.

For those of you who possess an attention span greater than that of a Gen-Zer, let’s unpack.

Olguin found that Lady Gaga’s use of the word “Mayhem” for her album and her attendant merchandise sales was “expressive” rather than source defining, and therefore was protected by the First Amendment and non-infringing on Lost’s mark.  The Court’s ultimate ruling on this issue was as follows:

“Because defendant’s use of the Mark is artistically relevant and does not explicitly mislead consumers as to the source or content of the challenged work, ‘the Lanham Act does not apply, and [plaintiff] cannot succeed on its claims for trademark infringement and false designation of origin.’”

Significantly, Judge Olguin’s opinion did not even reach the issue of whether there was a likelihood of confusion between Lost’s mark and Lady Gaga’s use of Mayhem—the First Amendment principles were so strongly demonstrated that the Court did not even deem it necessary to determine whether consumers were likely to be confused between the two corresponding uses of Mayhem.

Admittedly, this is not how I thought the Court’s denial of this Motion would play out.  My initial prediction was that the Court would hang its hat on the absence of any evidence of a likelihood of confusion (the stronger argument), and not even reach the issue of whether Lady Gaga’s use of Mayhem was expressive and protected by the First Amendment (which really could have gone either way).  Instead, the Court agreed with Lady Gaga’s home run, First Amendment argument and decided that it did not even need to reach the issue of likelihood of confusion. 

Simply stated, this is the death knell for Lost’s lawsuit. 

This is because there is nowhere to go from here for Lost, as Lady Gaga’s lawyers will immediately file a “motion for summary judgment” (asking the court to dismiss the case without ever having a trial), and Lady Gaga will undoubtedly win given that the Court has already rebuked its trademark infringement claims in the strongest way possible.  At that point, Lost’s only option would be an appeal to the Ninth Circuit, which would be an uphill battle and would almost certainly be denied.  But even if an appeal were granted, Lost would still be facing its independent problem with a lack of evidence of any likelihood of confusion once the case is remanded back to the trial court.

If Lost’s lawyers are smart, the next step is attempting to negotiate a dismissal with both sides walking away and bearing their own costs and attorneys’ fees (that is, if Lady Gaga even agrees to that and doesn’t want to make an example out of Biolos any more than she already has).

And if Lost cannot get Lady Gaga to agree to a “walk away,” it now faces a significant risk that the Court will find that this is an “exceptional case” under the Lanham Act that warrants an award that would require Lost to pay for all of Lady Gaga’s attorneys’ fees.  With the way that firms like Gibson Dunn (Lady Gaga’s attorneys) bill these days with partner rates that approach or exceed $3,000 per hour, this could be close to $1 million at this stage of the lawsuit.  I’m not sure what Lost’s balance sheet looks like, but a judgment like that against Lost could be curtains for its business.

Incidentally, there is another surf website out there (yes, we are absolutely naming names, and it’s obviously Stab) that published a story featuring its own purported anonymous IP lawyer who, rather surprisingly, opined that Lost had a pretty good chance in this lawsuit after my initial article on this subject was published.  

And this is precisely why, dear reader, that there is no sweeter candy than the Ultra Hard Surf Candy.

Sometimes imitated.

Never equaled.