The Velvet Underground & Nico (1967), featuring the famous Banana Image/Banana Design designed by Andy Warhol, is the first album of the American rock band The Velvet Underground (“VU”). Decades after the legendary band broke up, it continues to license the Banana Design for consumer goods as well as use it to promote the group during reunion concerts.
In 2011, VU sued the Andy Warhol Foundation (the “Foundation”) for copyright and trademark infringement. The Foundation, holds copyright in many of Warhol’s works which it also licenses for reproduction in consumer goods. In 2009, the Warhol Foundation was first to seek exclusive right over the image by precluding the VU’s use of the Banana Image, alleging copyright infringement. VU rejected any such claims arguing that they held ownership rights in the image.
The suit arose as a result of the Foundation’s plans to license some Warhol images, including the Banana Image, to appear on iPhone and iPad cases. At the time, VU demanded the Foundation cease its licensing activities which were likely to “create consumer confusion over the good’s connection to VU.” VU argued that this iconic image had secondary meaning as VU’s mark. VU started legal proceedings after the Foundation rejected its demands and asserted that they “may have” a copyright interest in the Banana Design. In the original complaint, VU sought a declaratory judgement that the Warhol Foundation held no copyright in the Banana Design.
In response, the Foundation executed a covenant not to sue VU for copyright infringement. Specifically, according to the the covenant the Foundation agrees “unconditionally and irrevocably… to refrain from making any claim(s) or demand(s), or from commencing, causing, or permitting to be prosecuted any action in law or equity” against VU and related entities.
In light of the said covenant, on September 7, 2012, US District Court of the Southern District of New York opinion issued by Alison J. Nathan, dismissed the Plaintiff’s complaint over copyright because it found no “immediate, realistic prospect of injury to VU from the Warhol Foundation’s asserted copyright.”
PS The band members may still press their trademark claims because members of the public recognize the design as the symbol of the Velvet Underground. It is too soon to tell whether the court-weary Warhol Foundation will be providing VU with another opportunity to bring legal action any time soon.