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United States of America
US Trademark law provides greater protection than the Copyright law against "parody" as fair use defence
Section 107 of the US Copyright Act (1976) states that use of a copyrighted work for purposes such as criticism, comment, news reporting, teaching, scholarship, or research, is fair use and not an infringement of copyright. Although the law does not expressly include the word 'parody', it is considered as a genre of fair use, and whenever a defendant asserts parody as a defence, US Courts analyse the following four factors in determining a finding of fair use:
Thus in copyright cases, courts attempt to balance interests of free speech and freedom of expression with the intellectual property rights at stake.
Courts often rule against the copyright holder where it appears that the 'parody' has not caused directly or indirectly any loss or displacement of market sales.
Courts have considered that where the purpose of the parody is to amuse and not confuse the public, defence of fair use is most likely to prevail.
Further, First Amendment protection is accorded where the parody does not serve to promote a competing product, but rather is used as a part of a story line or to convey an idea through a literary or artistic work. Courts have always been more lenient towards parodies in relation to copyrighted works, stating that 'copyright law should be hospitable to the humour of parody'.
US Trademark Law more resistant to 'parody' as fair use defence
A trademark parody defence does not succeed in most cases on the grounds that consumers may be confused into assuming that the trademark owner has somehow sponsored the parody. Although parody is accepted as freedom of expression, it is considered to override the trademark owner's rights, if the parody is used for purely commercial purposes.
Commercial use of another's trademark is in all cases considered as an infringement and fair use defence is most unlikely to prevail. Even where a defendant uses another's trademark in a humorous way to promote his own products and services, it is not a permitted trademark parody use.
Commercial use of another's trademark in the Internet context is similarly considered an infringement. However, in cases of editorial parody, where a trademark is utilised for the purposes of satirising even a popular and well-known trademark, there are chances of defence of fair use prevailing, despite claims of source confusion or dilution of the trademark.