Stuffed & Sued

Background: In the world of plush toys, a legal battle has ensued that's more gripping than a toddler's grasp on their favorite teddy bear.

Squishmallows, the round, soft, and squishy toys that have become a sensation across the globe, are at the center of a legal tussle with Build-A-Bear Workshop Inc. The makers of Squishmallows have filed a lawsuit against Build-A-Bear, accusing their new "Skoosherz" line of being copycats. Take a look for yourself.

Deja Vu: The stuffed toy industry's history is no stranger to disputes. In 2012, Diece-Lisa Industries (DLI), a New Jersey company claimed that Disney's depiction of Lots-o’-Huggin’ Bear from Toy Story 3 infringed on their "Lots of Hugs" trademark.

In 1994, DLI first produced its “Lots of Hugs” teddy bear, a wearable stuffed animal that allowed wearers to simulate a hug from a bear. Following the success and merchandising push of Toy Story 3, Diece-Lisa argued a “reverse confusion theory,” claiming that Disney’s character overshadowed their toys and led consumers to thinking the “Lots of Hugs” mark came from Disney.

Disney argued that Lots-o’-Huggin’ Bear was a unique character with a distinct personality and appearance, and highlighted the transformative nature of their creation within the context of the film.

Take a look for yourself.

The case has seen a few twists and turns and is still pending its final outcome.

Fact: The concept of trademark law dates back to at least the 13th century, with bakers marking their bread as a sign of quality assurance. The Bakers’ Marking Law was enacted by British Parliament in 1266 and required every baker to put their mark on the bread they baked.

Definition: "Trade Dress"

This legal term refers to the overall visual appearance of a product, including its shape, colors, and packaging. Think of it as the product's unique "outfit" protected by law.

In the Squishmallow vs. Build-A-Bear case, Squishmallow has claimed particular elements of their product are protected, while Build-A-Bear is arguing that the claimed Trade Dress features of the Squishmallows are just necessary elements needed to create this category of pillow-type plushies.

Timeline: Hug it Out

• 2017, District Court: The judge rules in favor of Disney, citing the First Amendment's protection of artistic expression and finding "Lots-o’-Huggin’ Bear" to be sufficiently different from "Lots of Hugs" to avoid confusion.

• 2019, Appeal: DLI appeals, raising additional arguments like potential trademark dilution. However, the court found their new arguments lacked merit and upheld the previous ruling.

• 2023, Supreme Court: DLI petitions the Supreme Court, which agrees to review the case in light of a similar trademark-copyright dispute involving Jack Daniel's whiskey and a dog toy. The case currently awaits further consideration by the Supreme Court.

Quote: “I didn't throw you away. Your kid did. Ain't one kid ever loved a toy, really. Chew on that when you're at the dump.” - Lots-o'-Huggin' Bear

Recommended Reading: The Teddy Bear Encyclopedia

A photographic album displays more than five hundred bears, from the first Steiff teddy bear to the most creative new versions, each annotated in detail, and offers directions on repairing and restoring worn out teddies, advice on collecting, and more.

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