Flippers Up!

By Michelle Visser

Last week, PEI Licensing, LLC., the owner of the ORIGINAL PENGUIN brand (also known simply as PENGUIN) sued Pudgy Penguins Inc. in federal court in Florida over their respective penguin trademarks.

PEI is the owner of numerous well-known clothing brands including PERRY ELLIS, AXIST, FARAH and CUBAVERA, in addition to its PENGUIN and ORIGINAL PENGUIN brands. Munsingwear, Inc. introduced the ORIGINAL PENGUIN brand in 1956, and its successors have sold apparel under the brand for 70 years. ORIGINAL PENGUIN brand is particularly popular among golfers. PEI’s penguin logos have various stylizations of penguins, though its predominant logo appears to be:

PUDGY PENGUINS began as a non-fungible token collection in 2021. Since then, PUDGY PENGUINS has become one of the biggest brands in the crypto sphere, with a Solana-based meme coin known as PENGU. Its penguin-themed toys are sold on its own website, through national retailers including WalMart and Target, and on Amazon. Sales of Pudgy Penguins toys were approximately $10 million in the first year.

PEI filed suit, with allegations of trademark infringement, trademark dilution, unfair competition and Florida state law claims. The lawsuit claims that the parties’ marks are similar, that both parties sell clothing in association with their marks and that Pudgy Penguins’ use of the penguin marks causes confusion to the consuming public and dilutes the distinctiveness of PEI’s trademarks.

The complaint includes a comparison of the marks on shirts:

And on hats:

Not surprisingly, Pudgy Penguins took to social media with a meme from The Office, to poke fun at the lawsuit and its assertion that the logos are similar.

Pudgy Penguins has trademark applications for PUDGY PENGUINS, FOREVER PUDGY PENGUINS, PENGU NATION, and I AM MY PENGUIN, AND MY PENGUIN IS ME. PEI has already opposed the applications for PENGU NATION and I AM MY PENGUIN, AND MY PENGUIN IS ME, and those oppositions are pending. It also opposed the application for the logo below, but subsequently withdrew the opposition.

PEI will likely face an uphill battle. Even on the federal register, PEI is not the only entity with registered trademarks incorporating the word “PENGUIN” for clothing. PITTSBURGH PENGUINS, LITTLE PENGUINS and PENGUINS & PINEAPPLES are all registered trademarks by third parties. Similarly, PEI is not the only entity with registered trademarks incorporating the image of a penguin. Registrations for the penguin logos below for clothing currently coexist with PEI’s registrations.

Additionally, enforcing trademark rights in clothing brands can be like herding cats. A straightforward lawsuit against a well-established clothing manufacturer is difficult enough. Especially in the apparel industry, anyone with a heat press can produce branded apparel and apparel with third parties’ designs. Printing on demand is big business. Customers can order clothing through companies such as CafePress, Vistaprint, Bonfire, Zazzle and Spreadshirt using online design tools. Submit a design, choose the clothing items and the finished product is shipped to you. Etsy store owners offer similar services. Reputable and litigation-conscious businesses may reject orders for branded apparel that is not ordered by the brand owners, but not all instances will be noticed or refused. And knock-off apparel often finds its way to online platforms, flea markets and tourist locales such as Times Square.

Keeping trademark brands for clothing is a difficult job indeed. Be sure to work with your trademark counsel to ensure your brand is protected.

Michelle Visser is a partner of Fishman Stewart, with over 25 years of experience practicing trademark law with other members of the firm’s Trademark Group. Check out her full bio here.