The Second Circuit affirmed that the adult-themed play, "Who's Holiday!" is a fair use of Dr. Seuss's original, "How the Grinch Stole Christmas!" (Grinch) and did not infringe any trademarks. In Lombardo, Who's Holiday Limited Liability Company v. Dr. Seuss Enterprises, L.P., the Southern District of New York granted summary judgment on the pleadings to the plaintiffs. This enabled the plaintiffs, essentially a playwright close to the beginning of his career, to avoid costly discovery. The Southern District had decided that "Who's Holiday" was a parody with each of the four factors of a standard fair use analysis weighing in the plaintiffs' favor. Dr. Seuss Enterprises (DSE) argued strenuously that some of those factors should not have been decided without discovery and appealed.
According to DSE, "Who's Holiday" is essentially a sequel, similar to the facts in Salinger v. Colton. Lombardo's play begins a few decades where Grinch left off. Unexpectedly, though, since that Christmas when the Grinch joined Whoville in its non-materialistic celebration, Cindy Lou Who had the Grinch's child out of wedlock, developed drug problems, and more. While the Circuit Court asked DSE about this position at oral argument, it did not address these claims in its opinion.
The Court found that the play was clearly a parody (the first factor in the plaintiff's favor) and that the second factor "is rarely useful 'in separating the fair use sheep from the infringing goats in a parody case, since parodies almost invariably copy publicly known, expressive works,'" quoting from Campbell (the second factor in the plaintiffs' favor).
DSE also argued that much of the first act of "Who's Holiday" was simple regurgitation of the events from the underlying work, taking a larger quantity than necessary for the audience to recognize the subject of the parody. Lombardo's position, which the Second Circuit adopted, was that nothing was taken verbatim, nor quoted, and the material is used simply to recount the plot of Grinch, invoking the original work (the third factor in the plaintiffs' favor).
Regarding the fourth factor in a standard fair use analysis, potential harm to the market for the underlying work and any derivative works, DSE espoused its active licensing for many Seuss properties, including Grinch, and including so-called "adult" versions of Seuss properties. The Court disagreed, affirming the district court's analysis that there is little likelihood of harm to those markets arising from this particular parody.
Finally, the Second Circuit affirmed the district court's analysis of trademark claims, finding that, under Rogers v. Grimaldi, no trademark infringement had occurred.
All in all, this was an important case because it was a loss for DSE, a voracious protector of its valuable IP. However, in many ways, this was a run-of-the-mill case, confirming, rather than expanding, any notions of what constitutes fair use under the Copyright Act.