Q: Is Shopdropping a Lanham Act violation?

A: Shopdropping (alternately known as DropLifting) is the practice of leaving goods at a store, rather than leaving a store with goods. A recent NY Times article explained the practice.[1] Essentially, artists and members of various counter-cultures use a store’s shelf space to either sell their own product, sell their art, or to make a cultural statement. Often, this involves repurposing a commercial product by manipulating the trademark or re-painting a package, sometimes referred to as “subverting.” Under trademark law, a trademark holder is generally given exclusive rights. However, there are certain limited allowances for “fair use.” Fair use generally protects usages such as news reporting, education, and parody.

If an artist is altering a trademark or repurposing a package (which can also be trademarked – i.e. the distinctive Coca-Cola bottle) then they are infringing upon the trademark. However, the artist may still find protection under the “fair use” concept.

There is a lot of inconsistency in how the courts have granted “fair use” rights to trademark infringers. Some general (but not absolute) rules are that “fair use” is more
likely to be honored if it is a more traditional medium for free speech (photos or books, etc), if the use is not likely to cause confusion as to who made it and if it is not particularly disparaging of the trademark holder.

Fair use claims are affirmative defenses, meaning that they are only asserted as a response to being sued for infringement. Therefore, every potential infringer must
evaluate whether they will be sued by a trademark holder.

To that end, any shopdroppers who use altered products or trademarks are definitely opening themselves up to claims of trademark infringement. Whether or not those
claims will stand up in a court of law is an open question, but you’ll likely be paying some lawyers fees in order to find out that answer.