Trademark Dilution Laws - LawCatalog

Trademark Dilution Laws - LawCatalog

CHAPTER 1 Trademark Dilution Laws Chapter Contents § 1.01 § 1.02 § § § § 1.03 1.04 1.05 1.06 Introduction [1] Dilution Doctrine [2] The Federal Tr...

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CHAPTER 1

Trademark Dilution Laws Chapter Contents § 1.01 § 1.02

§ § § §

1.03 1.04 1.05 1.06

Introduction [1] Dilution Doctrine [2] The Federal Trademark Dilution Act of 1996 The Trademark Dilution Revision Act of 2006 (“TDRA”) [1] Background [2] Famous Marks [a] Tightening Qualifications for Famous Marks [b] Non-Exclusive Factors to Establish Fame [c] Impact on Niche Fame Doctrine [3] Proof of Likely Dilution or Tarnishment [a] Dilution by Blurring [b] Dilution by Tarnishment [4] Trade Dress Dilution [5] Dilution Online [6] Dilution and Tarnishment Before the U.S. Patent and Trademark Office [7] Exclusions and Defenses Under the TDRA [a] Fair Use [b] Ownership of a Federal Registration Excludes a State Law Anti-Dilution Claim [8] Remedies Under the TDRA State Dilution and Tarnishment Statutes Where Does the Law Go from Here? State Trademark Anti-Dilution Laws Chart Sample Complaint for Trademark Dilution in Violation of § 43(c) of the Lanham Act

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§ 1.01 Introduction [1]—Dilution Doctrine Trademark dilution laws have a distinct focus that is different from other trademark laws. “Unlike traditional infringement law, the prohibitions against trademark dilution are not the product of common-law development, and are not motivated by an interest in protecting consumers.”1 Dilution law guards against “[t]he lessening of the capacity of a famous mark to identify and distinguish goods or services, regardless of the presence or absence of competition between the owner of the famous mark and other parties, or of likelihood of confusion. This typically occurs as the result of blurring or tarnishment of the famous mark.”2 Trademark dilution theory was introduced in 1927, and was famously described as the “whittling” away of the distinctiveness of the mark.3 The theory behind this is that a brand owner’s goodwill can be violated even where there is no likelihood of confusion, which is necessary to find trademark infringement or unfair competition under state or federal law.4 In this way, dilution focuses more on protecting brand owners than consumers.5 In particular, dilution law primarily protects famous brands against names or marks used with different types of goods or services or use that is in some way unsavory— addressing harm to the mark’s value and commercial magnetism.6 One criticism of dilution law is that it is difficult to define and vague as compared to other areas of trademark law, and, therefore, is subject to being applied too broadly.7 In addition, many academics criticize the legal doctrine’s focus on harm to brands’ goodwill rather than on its

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Moseley v. V Secret Catalogue, Inc., 537 U.S. 418, 429, 123 S.Ct. 1115, 1122 (2003). The International Trademark Association’s definition of dilution noted on its website at http://www.inta.org/TrademarkBasics/FactSheets/Pages/TrademarkDilution US.aspx. See also, Mead Data Central, Inc. v. Toyota Motor Sales, USA, Inc., 875 F.2d 1026, 1034 (2d Cir. 1989) (“several definitions of dilution exist”). 3 Schechter, “The Rational Basis of Trademark Protection,” 40 Harv. L. Rev. 813, 825 (1927). 4 Long, “Dilution,” 106 Columbia L. Rev. 1029, 1034 (2006) (“[D]ilution law is producer-focused rather than consumer-focused: It seeks to prevent diminution in the value of a famous mark stemming from the use of the mark by someone other than the trademark holder.”). 5 See: Tushnet, “Gone In Sixty Milliseconds: Trademark Law and Cognitive Science,” 86 Tex. L. Rev. 507, 510 (2008); Bone, “A Skeptical View of The Trademark Dilution Revision Act,” 11 Intell. Prop. L. Bull. 187, 187-189 (2007). 6 Long, N. 4 supra, 106 Columbia L. Rev. at 1034. 7 See: Tushnet, N. 5 supra, 86 Tex. L. Rev. at 510; Bone, N. 5 supra, 11 Intell. Prop. L. Bull. at 189. 2

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impact on consumers.8 Such critics contend that without proper restraints, dilution law grants trademark owners too much protection, and threatens free speech commentary and criticism about trademarked products.9 In response, federal and state legislatures have limited the scope of dilution laws to protect marks that are famous, or at least well known, and have carved out explicit exceptions for conduct or speech that is traditionally protected by the First Amendment.10 The federal dilution law is fairly new compared with other trademark laws, having been originally enacted in 1996 and then amended in 2006.11 Massachusetts enacted the first state dilution law in the late 1940’s.12 Federal and state dilution laws have different terms and scope, but similar goals. They may be pled in the same case, but sometimes conflict when the allegedly dilutive mark is subject to a federal registration.13 Brand owners sometimes bring dilution law claims as supplemental counts in trademark infringement and unfair competition cases.14 Where likelihood of confusion may be difficult to establish, brand owners should consider bringing dilution law claims on their own.15

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See: Tushnet, N. 5 supra, 86 Tex. L. Rev. at 510 (“[D]ilution, if it survives constitutional scrutiny, should best be understood as an extremely limited right against free riding, not necessarily corresponding to any readily identifiable interference with marketers’ ‘ownership’ of consumer beliefs. Dilution is, ultimately, an underevidenced concept and one that invites socially wasteful litigation. Thus, if courts sustain dilution laws against First Amendment challenges, they should nonetheless interpret dilution narrowly whenever possible.”); Bone, N. 5 supra, 11 Intell. Prop. L. Bull. at 187189 (“The arguments for dilution have focused historically on protecting the seller’s goodwill and the mark’s power to attract consumers. But this raises the critical question: Why should trademark law protect goodwill and selling power in the absence of consumer confusion?”). (Emphasis in original.) 9 Id. 10 See, e.g., Trademark Dilution Revision Act, 15 USC § 1125(c) (“TDRA”) (amending the federal dilution law to include a tougher standard to establish protection under the statute for plaintiffs claiming famous marks and creating explicit exemptions from liability); Illinois dilution statute, 765 ILCS § 1036/65(a) (requiring proof of actual dilution which is a tough standard). 11 Bone, N. 5 supra, 11 Intell. Prop. L. Bull. at 189 n.9; Wong, “Big Business In Their Belfry? Congress To Dumb Down Dilution,” 6 Loy. Law & Tech. Ann. 43, 50 (2006). 12 Id., 6 Loy. Law & Tech. Ann. at 50-53. 13 Starbucks Corp. v. Wolfe’s Borough Coffee, Inc., 588 F.3d 97, 103-114 (2d Cir. 2009) (claims brought under federal and New York state anti-dilution laws); 15 U.S.C. §1125(c)(6) (federal dilution statute bars state dilution law claims if they are brought against a federally registered trademark). 14 See, e.g.: Seventh Circuit: Facebook, Inc. v. Teachbook.com LLC, 819 F. Supp.2d 764, 784786 (N.D. Ill. 2011). Eleventh Circuit: PepsiCo, Inc. v. #1 Wholesale, LLC, 2007 WL 2142294, 2007 U.S. Dist. LEXIS 53768 (N.D. Ga. July 20, 2007). 15 See Shire, “Dilution Versus Deception - Are State Antidilution Laws an Appropriate Alternative to the Law of Infringement,” 77 Trademark Rep. 273, 287 (1987) (Rel. 2)

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Only since the advent of the first federal statute in 1996 has the anti-dilution claim gained prominence and become more than just a typical secondary count in a trademark dispute.16 For defendants, there are clear avenues to challenge dilution claims on the merits. For example, there are fairly high hurdles to establish protection (e.g., fame), and several types of uses are specifically exempted from the scope of state and federal dilution laws.17 This tough standard helps in defending against such claims, and by limiting the rights of prior brand owners, aids in selecting a new mark and evaluating risk before adoption. If the test were not stringent, it would be difficult to select a new mark without incurring substantial risk because there would be too many potential sources of objection. Thus, the anti-dilution laws attempt to balance the competing interests of those who possess rights, those who seek to obtain new rights, and those who wish to use certain terms without conflict. [2]—The Federal Trademark Dilution Act of 1996 Congress passed the first federal dilution law, the Federal Trademark Dilution Act (“FTDA”), in 1996.18 The FTDA allowed the owner of a famous mark to obtain injunctive relief if another party’s use of a mark diluted the distinctiveness of the famous mark.19

(“plaintiffs in trademark actions now have available a potent new weapon in addition to their traditional claims for trademark infringement and unfair competition. Dilution is a powerful claim for a plaintiff, because it is easier to prove than likelihood of confusion.”); see also, McCarthy, 4 McCarthy on Trademarks and Unfair Competition, § 24:72 (4th ed. 2009) (“[W]hen the likelihood of confusion test is not met, the dilution theory raises the possibility of recovery based on an entirely different consumer state of mind. The dilution theory grants protection to strong, well-recognized marks even in the absence of a likelihood of confusion, if defendant’s use is such as to be likely to diminish or dilute the strong identification value of the plaintiff’s mark even while not confusing customers as to source, sponsorship, affiliation or connection.”). 16 See: Supreme Court: Moseley v. V Secret Catalogue, Inc., 537 U.S. 418, 425-428, 123 S.Ct. 1115, 155 L.Ed.2d 1 (2003) (recounting claims brought under the Federal Trademark Dilution Act (“FTDA”)). Second Circuit: Starbucks Corp. v. Wolfe’s Borough Coffee, Inc., 588 F.3d 97, 104-105 (2d Cir. 2009) (noting claims brought under the TDRA). But see, Long, N. 4 supra, 106 Columbia L. Rev. at 1031 (“The data show that dilution has not been as powerful a theory of infringement as one might expect. Judicial enforcement of dilution law is not robust today and has been eroding over time”). 17 See, e.g: Trademark Dilution Revision Act, 15 U.S.C. §1125(c) (tough fame standard and exemptions from liability); Illinois dilution statute, 765 ILCS § 1036/65(a) (requiring proof of actual dilution). 18 Moseley v. V Secret Catalogue, Inc., 537 U.S. 418, 123 S.Ct. 1115, 155 L.Ed.2d 1 (2003) (discussing the FTDA). 19 Id. (monetary relief also was available in certain circumstances).

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Courts initially differed in the amount of harm a plaintiff had to prove to establish an FTDA claim.20 For example, the Fourth Circuit held that the FTDA required proof of actual economic harm.21 The Second Circuit, on the other hand, held that actual proof of economic harm was not required and that senior users of the mark could rely on circumstantial evidence of dilution without having to show lost revenue.22 A federal circuit split also developed as to whether the FTDA required evidence of actual dilution or whether mere likelihood of dilution was sufficient. The Supreme Court resolved the circuit split, and held that the FTDA required a showing of actual dilution.23 In particular, the Supreme Court compared the language used in the FTDA with other provisions in the Lanham Act.24 The Court noted that the FTDA provides the owner of a famous mark with injunctive relief where another person’s commercial use of a mark “causes dilution,” while other provisions in the Lanham Act refer to a “likelihood” of harm rather than completed harm.25 The Court held the FTDA’s text “unambiguously” requires a showing of actual dilution.26 After Moseley, legislation was introduced into Congress to address its impact on dilution law; that legislation eventually became the Trademark Dilution Revision Act of 2006 (“TDRA”).27

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Id. Ringling Bros.-Barnum & Bailey Combined Shows, Inc. v. Utah Division of Travel Development, 170 F.3d 449, 461 (4th Cir. 1999) (“establish[ing] dilution of a famous mark under the federal Act requires proof that (1) a defendant has made use of a junior mark sufficiently similar to the famous mark to evoke in a relevant universe of consumers a mental association of the two that (2) has caused (3) actual economic harm to the famous mark’s economic value by lessening its former selling power as an advertising agent for its goods or services”). 22 Nabisco, Inc. v. PF Brands, Inc., 191 F.3d 208, 224 (2d. Cir. 1999). 23 Moseley v. V Secret Catalogue, Inc., 537 U.S. 418, 434, 123 S.Ct. 1115, 155 L.Ed.2d 1 (2003). 24 Id., 537 U.S. at 432-433. 25 Id., 537 U.S. at 433. 26 Id., 537 U.S. at 433. 27 Trademark Dilution Revision Act of 2006, 15 U.S.C. §1125(c)(2)(A). It was enacted on October 6, 2006. 21

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§ 1.02 The Trademark Dilution Revision Act of 2006 (“TDRA”) [1]—Background The Trademark Dilution Revision Act (“TDRA”) amended and supplanted the FTDA and served as a response to Moseley and other cases that raised questions over the scope of the FTDA.1 The International Trademark Association (“INTA”)2 originally helped draft the FTDA,3 and asserted, along with many lower courts, that it did include likelihood of dilution and likelihood of tarnishment standards, even though the text mentioned neither.4 The drafters aimed to correct this perceived ambiguity by explicitly mentioning both standards in the legislation that led to the TDRA, and by providing protection for marks that had acquired distinctiveness in addition to those that are inherently distinctive.5 In addition, the drafters of the TDRA sought to counter claims of overreaching by brand owners. In particular, the TDRA required a greater degree of fame for marks to qualify for protection while also attempting to eliminate protection for niche market fame, as defined geographically or by product or service segment, and specifically exempting from its scope traditional areas of non-commercial speech.6 There are two types of dilution under the TDRA: dilution by blurring, which is an “association arising from the similarity between a mark or trade name and a famous mark that impairs the distinctiveness of the famous mark,”7 and dilution by tarnishment, which is an “association arising from the similarity between a mark or trade name and a famous mark that harms the reputation of the famous mark.”8 Both bases for dilution require a famous mark.9 In particular, under

1 See 15 U.S.C. §1125(c) (TDRA statute). See also, House Judiciary Committee Report H.R. 109-23 on H.R. 683, 109th Cong., 1st Sess. (March 17, 2005), available at http://www.gpo.gov/fdsys/pkg/CRPT-109hrpt23/pdf/CRPT-109hrpt23.pdf (explanation of reasons and goals for TDRA). 2 See www.inta.org. 3 See Testimony of Jacqueline A. Leimer, President, International Trademark Association, on Revising the Federal Trademark Dilution Act, before the Subcommittee on Courts, the Internet and Intellectual Property, Committee on the Judiciary, U.S. House of Representatives, April 22, 2004, 108th Cong. 2nd Sess., available at http://judiciary.house.gov/legacy/leimer042204.htm (last visited May 30, 2011) (“INTA was also a prime advocate for passage of the FTDA”). 4 Hilliard, Welch and Marvel, Trademarks & Unfair Competition Deskbook, § 10.04 (5th ed. 2011) (discussing court authority for these views of the FTDA prior to Moseley). 5 Id. at § 10.05. 6 15 U.S.C. §1125(c). 7 15 U.S.C. §1125(c)(2)(A). 8 Id. 9 Id.

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the TDRA, a brand owner may bring a cause of action against another person’s commercial use of a mark or trade name if the use is subsequent to the brand owner’s mark acquiring fame.10 [2]—Famous Marks [a]—Tightening Qualifications For Famous Marks The FTDA did not specifically define the meaning of a famous mark. The TDRA drafters sought to rectify this problem, which had resulted in too many marks receiving protection under the federal dilution statute.11 Granting such broad protection arguably created too strong a right against other marks in non-competing fields or geographic areas.12 It also made it difficult for brand owners and would-be brand owners to conduct effective clearance analysis, which assesses the risk of potentially conflicting marks already in the marketplace, prior to adopting or applying to register a new mark. In response, the TDRA defined a famous mark as one that is “widely recognized by the general consuming public of the United States as a designation of source of the goods or services of the mark’s owner.”13 In contrast to the levels of fame relevant to analyzing the strength of a mark or the degree of its recognition under the likelihood of confusion test for trademark infringement, the threshold for fame for dilution purposes is much higher.14 [b]—Non-Exclusive Factors To Establish Fame The non-exclusive factors to establish fame under the TDRA include: (i) The duration, extent, and geographic reach of advertising and publicity of the mark, whether advertised or publicized by the owner or third parties; (ii) The amount, volume, and geographic extent of sales of goods or services offered under the mark; (iii) The extent of actual recognition of the mark; and (iv) Whether the mark was registered under the Act of March 3, 1881, or the Act of February 20, 1905, or on the principal register.15 10

15 USC §1125(c)(1). Heller Inc. v. Design Within Reach, 2009 WL 2486054, at *3-*4, 2009 U.S. Dist. LEXIS 71991, at *9-*10 (S.D.N.Y. Aug. 14, 2009) (citing McCarthy, 4 McCarthy on Trademarks and Unfair Competition, § 24:104 (4th ed. 2009)). 12 Id. 13 15 U.S.C. §1125(c)(2). 14 Fame for the likelihood of confusion standard “‘varies along a spectrum from very strong to very weak’” while fame for the likelihood of dilution standard is an “either/or proposition - sufficient fame for dilution either exists or it does not.” 7Eleven Inc. v. Wechsler, 2007 TTAB LEXIS 58, at *21-*22 (T.T.A.B. May 15, 2007). (Citation omitted.) 15 15 U.S.C. §1125(c) (i)-(iv). 11

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In considering evidence for the first factor, famous marks usually are the subjects of multi-million dollar advertising budgets.16 For the second factor, the TDRA contemplates large volumes of sales spread over a wide geographic area.17 The necessary showing for advertising and sales volume and geographic coverage remains unclear for these first two factors, but it is considerable.18 For the third factor, courts consider consumer survey evidence to determine more objectively the degree of recognition.19 The failure to include such survey evidence, however, is not dispositive.20 [c]—Impact on Federal Niche Fame Doctrine Under the niche fame doctrine, a brand may be protected under dilution law even if its fame extends only to a certain industry segment or geographic area.21 For example, the FTDA protected the mark

16 See, e.g.: Second Circuit: Heller Inc. v. Design Within Reach, Inc., 2009 WL 2486054 at *3, 2009 U.S. Dist. LEXIS 71991, at *11 (S.D.N.Y. Aug. 14, 2009). Fourth Circuit: V Secret Catalogue, Inc. v. Moseley, 558 F. Supp.2d 734 (W.D. Ky. 2008), aff’d 605 F.3d 382 (6th Cir. 2010). Eleventh Circuit: PepsiCo, Inc. v. #1 Wholesale, LLC, 2007 WL 2142294 (N.D. Ga. July 20, 2007). 17 University of Kansas & Kansas Athletics, Inc. v. Sinks, 2009 U.S. Dist. LEXIS 65207, at *11-*12 (D. Kan. July 28, 2009) (In a case involving collegiate logos and marks owned by the University of Kansas, the court found that fame was met under the TDRA where “plaintiffs submitted an abundance of evidence on the use of the various marks both within and outside the context of sporting events. In addition to national media coverage and exposure of the athletic teams, plaintiff submitted evidence that KU has been referred to as ‘Kansas’ since the 1930s and that KU has used the crimson and blue color scheme and the Jayhawk mascot for over 100 years.”); contra, Board of Regents, the University of Texas System v. KST Electric, Ltd., 550 F. Supp.2d 657 (W.D. Tex. 2008) (insufficient proof of fame). 18 See, e.g.: Second Circuit: New York City Triathlon v. NYC Triathlon Club, 704 F. Supp.2d 305, 321-322 (S.D.N.Y. 2010) (proof of national promotions, media coverage, sales and popularity of triathlon event submitted to show extent of fame and accepted by court as sufficient). Ninth Circuit: Google, Inc. v. American Blind & Wallpaper Factory, Inc., 2007 WL 1159950 (N.D. Cal. April 18, 2007) (insufficient proof of fame). 19 See, e.g.: Second Circuit: New York City Triathlon v. NYC Triathlon Club, 704 F. Supp.2d 305, 321-322 (S.D.N.Y. 2010). Third Circuit: Wawa Dairy Farms v. Haaf, 40 U.S.P.Q.2d 1629 (E.D. Pa. 1996) (survey used to establish dilution under the FTDA). Ninth Circuit: Nissan Motor Co. v. Nissan Computer Corp., 2007 U.S. Dist. LEXIS 90487, at *49 n.62 (C.D. Cal. Sept. 21, 2007) (dilution surveys were an option that the plaintiff could have implemented). 20 Adidas America, Inc. v. Payless Shoesource, Inc., 546 F. Supp.2d 1029, 1063 (D. Ore. 2008). 21 See, e.g.:

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WAWA for convenience store services even though it was famous in only five states.22 Similarly, the FTDA protected INTERMATIC for electrical and electronic products.23 The TDRA, however, purports to eliminate protection for marks that only have niche fame.24 Indeed, the TDRA’s definition of a famous mark as a mark that is widely recognized throughout the country by the general consuming public makes it significantly more difficult for brand owners to prove fame in a niche context.25 Nevertheless, some courts have found that niche market fame is still sufficient to meet the fame requirement under the TDRA,26 while others have reiterated that the general consuming public does not mean a certain segment of the public that buys the goods or services in question.27 The trend is against recognizing niche fame under the TDRA.28 This leaves state anti-dilution laws as the main source for claims based on the niche fame doctrine.29

Seventh Circuit: Syndicate Sales, Inc. v. Hampshire Paper Corp., 192 F.3d 633, 640-641 (7th Cir. 1999). Eighth Circuit: Frosty Treats v. Sony Computer Entertainment America Inc., 426 F.3d 1001, 1010-1011 (8th Cir. 2005). 22 Wawa Dairy Farms, Inc. v. Haaf, 40 U.S.P.Q.2d 1629, 1631-1632 (E.D. Pa. 1996). 23 Intermatic Inc. v. Toeppen, 947 F. Supp. 1227, 1236-1241 (N.D. Ill. 1996). 24 See, e.g.: Second Circuit: Dan-Foam A/S v. Brand Named Beds, LLC, 500 F. Supp.2d 296, 307 n.90 (S.D.N.Y. 2007) (Congress intended to reject niche fame, i.e., fame based on a particular channel of trade, segment of industry or service, or geographic region). Seventh Circuit: Top Tobacco LP v. North Atlantic Operating Co., 509 F.3d 380, 384 (7th Cir. 2007) (the TDRA amendment of 2006 “eliminated any possibility of niche fame”). Eighth Circuit: Cosi, Inc. v. WK Holdings, 2007 WL 1288028 at *2-*3, 2007 U.S. Dist. LEXIS 31990, at *6 (D. Minn. May 1, 2007) (COSI mark not famous even though plaintiff has restaurants in sixteen states). 25 Cf., Coach Services Inc, v. Triumph Learning LLC, 668 F.3d 1356, 1373 (Fed. Cir. 2010) (fame standard under TDRA tougher than showing fame under likelihood of confusion test). 26 See, e.g.: Fifth Circuit: Pet Silk, Inc. v. Jackson, 481 F. Supp.2d 824 (S.D. Tex. 2007) (market fame is sufficient to meet the requirement of fame under 15 U.S.C. §1125(c)(1)). Tenth Circuit: Harris Research, Inc. v. Lydon, 505 F. Supp.2d 1161 (D. Utah 2007) (preliminary injunction granted to protect plaintiff’s CHEM-DRY mark for carpet cleaning services under TDRA against CHEM-WHO for similar services, seemingly supporting the doctrine that market fame is enough under the TDRA). 27 Heller Inc. v. Design Within Reach, Inc., 2009 WL 2486054 at *4, 2009 U.S. Dist. LEXIS 71991, at *9 (S.D.N.Y. Aug. 14, 2009). 28 Top Tobacco LP v. North Atlantic Operating Co., 509 F.3d 380, 384 (7th Cir. 2007). 29 See §§ 1.03 and 1.05 infra.

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[3]—Proof of Likely Dilution or Tarnishment Once a brand owner establishes that its mark is famous under the TDRA, it must prove likelihood of dilution or likelihood of tarnishment.30 Importantly, the TDRA established that the test for dilution is likelihood of causing dilution,31 not actual dilution, changing the law to respond to the Moseley court’s interpretation of the FTDA.32 The TDRA requires the allegedly dilutive mark or trade name be used in commerce in order to be actionable,33 and that this use must commence “at any time after the owner’s mark has become famous.”34 Some courts have considered the potential for contributory dilution claims on the theory of secondary liability, but the viability of such a claim, where a party is essentially “encouraging others to dilute,” is unclear.35 The U.S. Supreme Court decision in Inwood Laboratories v. Ives Laboratories, Inc.36 provides the basis for examining contributory liability in the dilution context by employing the following standard: [I]f a manufacturer or distributor intentionally induces another to infringe a trademark, or if it continues to supply its product to one whom it knows or has reason to know is engaging in trademark infringement, the manufacturer or distributor is contributorily responsible for any harm done as a result of the deceit. Applying Inwood, the United States District Court for the Southern District of New York found eBay was not contributorily liable to Tiffany’s under the TDRA for the auction of counterfeit TIFFANY jewelry because: Tiffany has failed to demonstrate that eBay knowingly encouraged others to dilute Tiffany’s trademarks. Rather, to the extent that eBay may have possessed general knowledge of infringement and dilution

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15 U.S.C. § 1125(c). Id. 32 Moseley v. V Secret Catalogue, Inc., 537 U.S. 418, 434, 123 S.Ct. 1115, 155 L.Ed.2d 1 (2003); see also, Hilliard, Welch and Marvel, Trademarks & Unfair Competition Deskbook, § 10.05 (5th ed. 2011) (“After Moseley, federal trademark law was essentially defunct. This led to the drafting and passage of the Trademark Dilution Revision Act (“TDRA”) in 2006, 15 U.S.C. § 1125(c).”). 33 Visa International Service Ass’n v. JSL Corp., 590 F. Supp.2d 1306, 1316 (D. Nev. 2008), aff’d 610 F.3d 1088, 1092 (9th Cir. 2010) (citing 15 U.S.C. § 1125(c)(1)). 34 Id. 35 Tiffany (NJ) Inc. v. eBay, Inc., 576 F. Supp.2d 463, 526 (S.D.N.Y. 2008), aff’d in part and rev’d in part 600 F.3d 93, 112 (2d Cir. 2010) (issue of contributory dilution not raised on appeal and so waived) (quoting Lockheed Martin Corp. v. Network Solutions, Inc., 194 F.3d 980, 986 (9th Cir. 1999)). (Citation omitted.) 36 Id. (quoting Inwood Laboratories, Inc. v. Ives Laboratories, Inc., 456 U.S. 844, 854, 102 S.Ct. 2182, 72 L.Ed.2d 606 (1982)). 31

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by sellers on its website, eBay did not possess knowledge or a reason to know of specific instances of trademark infringement or dilution as required under the law.37 There is at least one reported case permitting a contributory dilution claim under the TDRA.37.1 [a]—Dilution by Blurring The TDRA provides six factors that courts may consider in determining whether a mark is likely to cause dilution by blurring: (i) The degree of similarity between the mark or trade name and the famous mark; (ii) The degree of inherent or acquired distinctiveness of the famous mark; (iii) The extent to which the owner of the famous mark is engaging in substantially exclusive use of the mark; (iv) The degree of recognition of the famous mark; (v) Whether the user of the mark or trade name intended to create an association with the famous mark; and (vi) Any actual association between the mark or trade name and the famous mark.38 In applying these non-exclusive factors, courts consider principles of equity.39 In addressing the first factor, the Second Circuit determined that the defendant’s mark and the famous mark need not be very or even substantially similar.40 Furthermore, the Ninth Circuit reversed a lower court and determined that the marks HOT WHEELS and HOT RIGZ were nearly identical and therefore similar under the TDRA even though they have clear visual differences.41 The Ninth Circuit subsequently clarified its position on this issue and held that there is no

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Id. Coach, Inc. v. Farmers Market & Auction, 881 F. Supp.2d 605, 704 (D. Md. 2012) (“Coach has stated a cognizable claim for contributory trademark dilution,” where defendants operated a market where vendors sold counterfeit COACH merchandise and defendants allegedly continued to rent space there when they knew or should have known of the counterfeiting). 38 15 U.S.C. § 1125(c)(2)(B). See also, Rosetta Stone Ltd. v. Google, Inc., 676 F.3d 144, 170 (4th Cir. 2012) (not every factor is relevant in every case). 39 Visa International Service Ass’n v. JSL Corp., 590 F. Supp.2d 1306, 1315 (D. Nev. 2008), aff’d 610 F.3d 1088, 1092 (9th Cir. 2010); Nissan Motor Co. v. Nissan Computer Corp., 2007 U.S. Dist. LEXIS 90487, at *39-*40 (C.D. Cal. Sept. 21, 2007). (Citation omitted.) 40 Starbucks Corp. v. Wolfe’s Borough Coffee, Inc., 588 F.3d 97, 108-109 (2d Cir. 2009). 41 Jada Toys, Inc. v. Mattel, Inc., 518 F.3d 628, 635 (9th Cir. 2007). 37.1

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requirement for marks to be identical or nearly identical in the TDRA.42 This is consistent with the language of the TDRA, which supports a more flexible standard in referencing the “degree” of similarity.43 Under the plain language of the statute covering the second factor,44 marks with acquired distinctiveness may be protected, a departure from earlier precedent interpreting the FTDA.45 There are five categories of trademarks: (1) generic, (2) descriptive, (3) suggestive, (4) arbitrary, and (5) fanciful.46 “At one end of the spectrum, generic marks give the general name of a product and embrace an entire class of products. . . . At the other end of the spectrum, suggestive, arbitrary, and fanciful marks are deemed inherently distinctive.”47 In the consideration of this second factor, if a mark “is not highly distinctive,” “[i]t does not receive the Lanham Act’s utmost protection from dilution.”48 Evidence of substantially exclusive use under the third factor may relate to the number of unauthorized third-party uses of the mark in question, efforts to police the mark, or the sufficiency of licensing practices at keeping the goodwill intact.49 This factor goes to the question of whether the mark functions as a “unique identifier” in the marketplace.50 If there are many third-party marks in the marketplace similar to the plaintiff’s mark, this undercuts its distinctiveness, while successful efforts to keep the marketplace free of such marks demonstrate its strength.51

42

Levi Strauss & Co. v. Abercrombie & Fitch Trading Co., 633 F.3d 1158, 11711173 (9th Cir. 2011). 43 Second Circuit: Starbucks Corp. v. Wolfe’s Borough Coffee, Inc., 588 F.3d 97, 108 (2d Cir. 2009); Miss Universe, LP v. Villegas, 672 F. Supp.2d 575, 593 (S.D.N.Y. 2009). Seventh Circuit: Facebook, Inc. v. Teachbook.com LLC, 819 F. Supp.2d 764, 784 n.3 (N.D. Ill. Sept. 26, 2011). 44 15 U.S.C. §1125(c)(2)(B). 45 15 U.S.C. §1125(c)(1); Nabisco, Inc. v. PF Brands, Inc., 191 F.3d 208, 224 (2d Cir. 1999) (prior precedent that did not protect marks that had merely acquired distinctiveness). 46 Visa International Service Ass’n v. JSL Corp., 590 F. Supp.2d 1306, 1316 (D. Nev. 2008) (citing Quiksilver, Inc. v. Kymsta Corp., 466 F.3d 749, 760 (9th Cir. 2006)). 47 Id. 48 Miss Universe, LP v. Villegas, 672 F. Supp.2d 575, 595 (S.D.N.Y. 2009). (Emphasis in original.) 49 See, e.g.: Visa International Service Ass’n v. JSL Corp., 590 F. Supp.2d 1306, 1316 (D. Nev. 2008) (insufficient evidence that the mark is exclusive); Nissan Motor Co. v. Nissan Computer Corp., 2007 U.S. Dist. LEXIS 90487, at *42-*43 (C.D. Cal. Sept. 21, 2007) (agreement that allowed other parties to share in use of mark not a license and undercut plaintiff’s showing on this exclusive use factor); Nike, Inc. v. Nikepal International, Inc., 2007 WL 2782030 at *7, 2007 U.S. Dist. LEXIS 66686, at *22 (E.D. Cal. Sept. 18, 2007) (a limited amount of third-party use will not defeat a showing of substantial exclusive use). 50 Nissan Motor Co. v. Nissan Computer Corp., 2007 U.S. Dist. LEXIS 90487, at *38 (C.D. Cal. Sept. 21, 2007). 51 Miss Universe, LP v. Villegas, 672 F. Supp.2d 575, 594 (S.D.N.Y. 2009).

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Circumstantial evidence relating to sales volumes, geographic scope of marketing, and length of time of such sales help to establish the fourth factor relating to degree of recognition.52 It is possible for a plaintiff to establish that it possesses a famous mark eligible for protection under the TDRA, but still fail the degree of recognition factor in the blurring analysis, which is what happened in the opposition proceeding concerning 7-Eleven’s BIG GULP mark for beverages.53 The fifth factor relates to intent to create an association and does not require an additional showing of bad faith.54 Nonetheless, where the “allegedly diluting mark was created with an intent to associate with the famous mark, this factor favors a finding of a likelihood of dilution.”55 There are no prescribed criteria for determining such an intent to create an association, and evidence may be difficult to acquire where there is a clear explanation as to why the defendant adopted a mark.56 Establishing an actual association requires a significant amount of proof,57 but survey evidence can support such a finding of an association or lack thereof.58 The failure to include survey evidence on this factor could weigh against a finding for plaintiff.59 Overall, 52

Visa International Service Ass’n v. JSL Corp., 590 F. Supp.2d 1306, 1315 (D. Nev. 2008), aff’d 610 F.3d 1088, 1092 (9th Cir. 2010). 53 7-Eleven, Inc. v. Wechsler, 2007 TTAB LEXIS 58, at *51-*52 (T.T.A.B. May 15, 2007). 54 Starbucks Corp. v. Wolfe’s Borough Coffee, Inc., 588 F.3d 97 (2d Cir. 2009). 55 Id., 588 F.3d at 109. 56 Miss Universe, LP v. Villegas, 672 F. Supp.2d 575, 594 (S.D.N.Y. 2009) (no evidence provided by plaintiff to rebut defendants’ contention that name selected had “nothing to do with” the plaintiff’s marks). 57 See: Nike, Inc. v. Nikepal International, Inc., 2007 WL 2782030, at *8, 2007 U.S. Dist. LEXIS 66686, at *25 (E.D. Cal. Sept. 18, 2007) (survey evidence considered on the issue of an association); Century 21 Real Estate LLC v. Century Surety Co., 2007 WL 433579, 2007 U.S. Dist. LEXIS 8434, at *6-*7 (D. Ariz. Feb. 5, 2007) (following FTDA precedent, the court also found that there must be a “mental association” between the marks even under the new likelihood of dilution standard of the TDRA). 58 Second Circuit: Starbucks Corp. v. Wolfe’s Borough Coffee, Inc., 588 F.3d 97, 109 (2d Cir. 2009) (reversal of district court’s determination that survey showing 30.5% of respondents thought of plaintiff’s mark as the first thing when they heard defendant’s mark did not show an association between the two marks). In a subsequent opinion on remand finding no likelihood of dilution by blurring, the district court found that while the “results of Plaintiff’s survey show some association between the terms Charbucks and Starbucks... [T]he survey did not measure how consumers would react to the Charbucks marks as they are actually packaged and presented in commerce.” Starbucks Corp. v. Wolfe’s Borough Coffee, Inc., 2011 WL 6747431, at *4, 2011 U.S. Dist. LEXIS 148081, at *10 (S.D.N.Y. Dec. 23, 2011). See also, Louis Vuitton Malletier, S.A. v. Hyundai Motor America, 2012 WL 1022247 at *11-*12, 2012 U.S. Dist. LEXIS 42793 (S.D.N.Y. March 22, 2012) (defendant’s survey evidence used against it by plaintiff to establish association). Ninth Circuit: Visa International Service Ass’n v. JSL Corp., 590 F. Supp.2d 1306, 1315 (D. Nev. 2008), aff’d 610 F.3d 1088, 1091-1092 (9th Cir. 2010) (issue of admissibility of expert testimony and market survey evidence not reached on appeal). (Rel. 2)

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hiring an expert or conducting a market survey may be necessary or helpful in certain cases, but is not required, especially as it is enough to “rely entirely on the characteristics of the marks at issue.”60 [b]—Dilution by Tarnishment Dilution by tarnishment is an “association arising from the similarity between a mark or trade name and a famous mark that harms the reputation of the famous mark.”61 There are no factors in the TDRA that help to define likelihood of tarnishment as there are with the consideration of likelihood of blurring. This uncertainty may cause some courts to rely on standards that the TDRA was meant to supplant, such as proof of actual harm.62 “A trademark may also be diluted by tarnishment if the mark loses its ability to serve as a ‘wholesome identifier’ of plaintiff’s product.”63 Courts use different factors for determining harm to reputation, such as whether a product would cause harm and whether there is firm evidence of such harm.64 In one case, the court entered an injunction on the grounds of tarnishment a distributor of bottle safes and stash cans, often used to store illegal drugs, that bore a brand owner’s marks.65 In the online context, courts will determine often the question of tarnishment by looking to whether there is a connection with “sexual activity, obscenity, illegal . . . activity or any other activity of questionable repute.”66 Finally, the list of conduct that might constitute tarnishment is not exhaustive, and the evidence need not be “seamy” to be actionable.67

59 Miss Universe, LP v. Villegas, 672 F. Supp.2d 575, 594 (S.D.N.Y. 2009) (plaintiff “offers no survey results or poll numbers here, and thus fails to show any instances of actual association between the two trademarks.”). 60 Visa International Services Ass’n v. JSL Corp., 610 F.3d 1088, 1091 (9th Cir. 2010). 61 15 U.S.C. §1125(c)(1). 62 See, e.g., Anheuser-Busch, Inc. v. VIP Products, LLC, 666 F. Supp.2d 974, 988 (E.D. Mo. 2008) (declining to grant a preliminary injunction on the basis of tarnishment where no proof of actual harm presented, despite this being a requirement previously found under the FTDA but not the TDRA which adopted likelihood of tarnishment). 63 Starbucks Corp. v. Wolfe’s Borough Coffee, Inc., 588 F.3d 97, 109 (2d Cir. 2009). 64 Louis Vuitton Malletier S.A. v. Haute Diggity Dog, LLC, 507 F.3d 252, 268269 (4th Cir. 2007). 65 PepsiCo, Inc. v. #1 Wholesale, LLC, 2007 WL 2142294, 2007 U.S. Dist. LEXIS 53768 (N.D. Ga. July 20, 2007). 66 Nissan Motor Co. v. Nissan Computer Corp., 2007 U.S. Dist. LEXIS 90487, at *39-*40 (C.D. Cal. Sept. 21, 2007). 67 Dan-Foam A/S & Tempur-Pedic, Inc. v. Brand Named Beds, LLC, 500 F. Supp.2d 296, 307-308 (S.D.N.Y. 2007). (Citations and quotation marks omitted); L & L Wings, Inc. v. Marco-Destin, Inc., 676 F. Supp.2d 179, 190 (S.D.N.Y. 2009) (evidence of likelihood of tarnishment under New York state law consisted of a “number of communications received by Plaintiffs complaining about the quality of products

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§ 1.02[4]

The Sixth Circuit has suggested that semantic association to sexually-related products creates a presumption of tarnishment that must be overcome through the presentation of evidence by defendants.68 The Sixth Circuit also suggests that defendants’ evidence could be in the “form of expert testimony or surveys or polls or customer testimony.”69 This presumption and shift in a requirement of production to defendants appears to be without precedent,70 and so may not be followed by other federal circuits. Courts consider survey evidence on the issue of tarnishment, but the evidence must show an association that harms the mark. “That a consumer may associate a negative-sounding junior mark with a famous mark says little of whether the consumer views the junior mark as harming the reputation of the famous mark.”71 The survey must establish that the junior mark “would affect the positive impressions” of the prior user’s mark.72 It is difficult to bring a tarnishment claim against the use of a mark with goods that are of very high quality,73 and also difficult to establish tarnishment without some evidence that a defendant’s goods are inferior in quality where no other extenuating circumstances such as a tie to pornography exist.74 Not surprisingly, a plaintiff who compliments the services of a defendant targeted in a tarnishment count will undercut such a claim.75 [4]—Trade Dress Dilution A product’s trade dress is its “overall image and appearance, and may include features such as size, shape, color or color combinations,

or services at Defendants’ stores,” but nothing apparently unseemly). See Desmond v. Chicago Boxed Beef Distributors, Inc., 2013 WL 372458, at *10, 2013 U.S. Dist. LEXIS 12629, at *14 (N.D. Ill. Jan. 29, 2013) (sale of counterfeit meat under mark stated valid claim of tarnishment under TDRA). See also, Davis and Weinstein, “The Sixty-Third Year of Administration of the U.S. Trademark (Lanham) Act of 1946,” 101 Trademark Rep. 523, 521-22 (2011). 68 V Secret Catalogue, Inc. v. Moseley, 605 F.3d 382, 388 (6th Cir. 2010). 69 Id. 70 See Davis and Weinstein, “The Sixty-Third Year of Administration of the U.S. Trademark (Lanham) Act of 1946,” 101 Trademark Rep. 323, 519 (2011). 71 Starbucks Corp. v. Wolfe’s Borough Coffee, Inc., 588 F.3d 97, 110 (2d Cir. 2009). 72 Id. 73 Id., 588 F.3d at 111. 74 Nissan Motor Co. v. Nissan Computer Corp., 2007 U.S. Dist. LEXIS 90487, at *57 (C. D. Cal. Sept. 21, 2007). 75 Miss Universe, L.P. v. Villegas, 672 F. Supp.2d 575, 592 (S.D.N.Y. 2009) (In denying the tarnishment claim, the court noted that the plaintiff had indicated that defendants ran a “‘high quality’” and “‘well-respected’” pageant.).

(Rel. 2)

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texture, graphics, and even particular sales techniques.”76 The TDRA protects trade dress if the owner can establish that it is famous and not functional.77 Functionality of trade dress was addressed by the U.S. Supreme Court in TrafFix Devices, Inc. v. Marketing Displays, Inc.78 In this case, the Court found that temporary road signs with visible spring mechanisms were functional and not subject to trade dress protection in part because the signs were subject to an expired utility patent.79 In particular, the Court noted that a product design with a particular appearance may be functional when it is “essential to the use or purpose of the device or when it affects the cost or quality of the device.”80 A plaintiff alleging trade dress dilution must overcome the hurdle of functionality and establish all of the other factors necessary to show dilution or tarnishment under the TDRA.81 While establishing fame for trade dress can be difficult,82 it is clearly possible where the design or configuration is highly distinctive and capable of being recognized as a source identifier.83 Unregistered components of a trade dress must be famous separate and apart from the fame of any registered components included in the trade dress.84 In a case involving the federally registered trade dress for a chair, the court dismissed the plaintiff’s complaint on the grounds that “[t]he plaintiff has not alleged sufficient facts to suggest that its Bellini Chair trademark plausibly has achieved the required level of fame to warrant protection. Indeed, the plaintiff has only pleaded that its chair is known to a niche population.”85 On the other hand, the three-striped

76

GMC v. Urban Gorilla, LLC, 500 F.3d 1222, 1226 (10th Cir. 2007). (Citations omitted.) 77 15 U.S.C. §1125(c)(4). 78 Traffix Devices, Inc. v. Marketing Displays, Inc., 532 U.S. 23, 33, 121 S.Ct. 1255, 149 L. Ed. 2d 164 (2001). 79 Id., 532 U.S. at 34-35. 80 Id., 532 U.S. at 33. 81 15 U.S.C. § 1125(c)(4). 82 See, e.g.: Sixth Circuit: Maker’s Mark Distillery, Inc. v. Diageo North America, Inc., 703 F. Supp.2d 671, 698 (W.D. Ky. 2010), aff’d on other grounds 679 F.3d 410 (6th Cir. 2012) (fame of dripping red wax seal design for bourbon not established where no survey presented and brand owner was not a “behemoth in the distilled spirits world”). Tenth Circuit: Hammerton, Inc. v. Heisterman, 2008 U.S. Dist. LEXIS 38036, at *23 (D. Utah May 9, 2008) (market for plaintiff’s light fixture was quite small). 83 Adidas America, Inc. v. Payless Shoesource, Inc., 546 F. Supp.2d 1029, 1063 (D. Ore. 2008). 84 Id. Cf., Unregistered product design trade dress must have secondary meaning to be protected against infringement. Wal-Mart Stores, Inc. v. Samara Brothers, Inc., 529 U.S. 205, 216, 120 S.Ct. 1339, 146 L.Ed.2d 182 (2000). 85 Heller Inc. v. Design Within Reach, Inc., 2009 U.S. Dist. LEXIS 71991, at *10 (S.D.N.Y. Aug. 14, 2009).

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design on a shoe was protected under the TDRA against a four-striped design where the plaintiff established widespread fame and recognition.86 Similarly, the Ninth Circuit upheld a finding that a plaintiff stated a claim under the TDRA in a case involving stitch design patterns for jeans.87 In a case involving the trade dress for phone designs where the jury awarded plaintiff a “very large” amount in damages (which the court declined to enhance), the court noted that “the trade dress dilution claim concerns product design - a doctrine at the outer reaches of trademark and trade dress law.”87.1 Thus, product design trade dress is protected and can be the subject of significant judgments, but courts are still wary about how far the protection should extend. [5]—Dilution Online Dilution law also protects marks against dilutive domain names, but at least one court has raised concerns over the scope of protection for famous marks in this context. “[T]he rule cannot be that the owner of a famous mark will always be able to enjoin the commercial use of that mark as a domain name. If it were, protection from dilution would no longer ‘come close’ to being a right in gross; such protection would, in essence, be a right in gross.”88 Keywords also are used online and may create a basis for dilution.89 Keywords are terms search engines may sell to companies to generate contextually relevant advertising for those companies in online Internet search results.90 Because keywords may contain famous brands, their sale and use may be subject to dilution law claims.91 The Anticybersquatting Consumer Protection Act (“ACPA”) provides a cause of action in federal court against the owners of domain names that dilute marks through cybersquatting.92 Under the ACPA,

86 Adidas America, Inc. v. Payless Shoesource, Inc., 546 F. Supp.2d 1029, 1063 (D. Ore. 2008). 87 Levi Strauss & Co. v. Abercrombie & Fitch Trading Co., 633 F.3d 1158, 11741175 (9th Cir. 2011). 87.1 Apple, Inc. v. Samsung Electronics, Ltd., 2013 WL 412862 at *4, 2013 U.S. Dist. LEXIS 13238, at *22-*23 (N.D. Cal. Jan. 20, 2013). 88 Nissan Motor Co. v. Nissan Computer Corp., 2007 U.S. Dist. LEXIS 90487, at *53 (C.D. Cal. Sept. 21, 2007). 89 Cf., Network Automation, Inc. v. Advanced Systems Concepts, Inc., 638 F.3d 1137, 1144 (9th Cir. 2011) (case involving trademark infringement claims). 90 Google, Inc. v. American Blind & Wallpaper Factory, Inc., 2007 U.S. Dist. LEXIS 32450, at *39 (N.D. Cal. April 18, 2007) (claim dismissed due to insufficient evidence of fame and distinctiveness). 91 Id. at *21, *37-*39. 92 15 U.S.C. §1125(d); see Web-Adviso v. Trump, 2013 WL 763746, 2013 U.S. Dist. LEXIS 28174 (E.D.N.Y. Feb. 28, 2013).

(Rel. 2)

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cybersquatting occurs when someone: “has a bad faith intent to profit from that mark,” and “(ii) registers, traffics in, or uses a domain name that— . . . (I) in the case of a famous mark that is famous at the time of registration of the domain name, is identical or confusingly similar to or dilutive of that mark.”93 The cybersquatting cause of action is different in scope from the TDRA.94 At least one court has determined that the ACPA should be the only means of bringing a cybersquatting claim, not Section 43(c) of the Lanham Act.95 Other courts find dilution violations under both the TDRA and the ACPA.96 Given that the claims have different requirements, it seems logical that both claims can be asserted against cybersquatters. Finally, for auction websites that merely use a mark to advertise and identify the availability of authentic goods sold in connection with said mark, there may be no likelihood of dilution by blurring or tarnishment.97 [6]—Dilution and Tarnishment Before the U.S. Patent and Trademark Office Likelihood of dilution and tarnishment are grounds for opposing a trademark or service mark application or petitioning to cancel a registration on the principal register before the Trademark Trial and Appeal Board (“TTAB”) in the United States Patent and Trademark Office (“USPTO”).98 A trademark examining attorney in the USPTO, however, cannot object during the application process to an application on these bases.99 Proceedings before the TTAB only decide questions of registrability, and not use, damages, or other types of relief offered by federal courts.100 The TTAB has, in the past, sustained rarely an opposition or petition for cancellation on the basis of likelihood of dilution.101 It may

93 Compare, 15 U.S.C. §1125(d)(1)(A)(i)-(ii)(II) (ACPA) with 15 U.S.C. § 1125(c) (TDRA). 94 Id. 95 See, e.g., Ford Motor Co. v. Greatdomains.com, Inc., 177 F. Supp.2d 635, 653656 (E.D. Mich. 2001). 96 See 3M Co. v. Thailand3M.net, 2013 WL 2156322, at *12-*14, 2013 U.S. Dist. LEXIS 58760 (E.D. Va. April 23, 2013). 97 Tiffany (NJ) Inc. v. eBay Inc., 600 F.3d 93, 111-112 (2d Cir. 2010). 98 15 U.S.C. § 1125(c)(1); 15 U.S.C. § 1052(f). For information on trademark oppositions or cancellations from the United States Patent and Trademark Office, see http://www.uspto.gov/trademarks/process/appeal/index.jsp. 99 15 U.S.C. §1052(f). 100 Id.; see United States Patent and Trademark Office Web site: http://www.uspto .gov/trademarks/process/appeal/index.jsp (last visited July 19, 2011). See also, 7Eleven, Inc. v. Wechsler, 2007 TTAB LEXIS 58, at *53 (T.T.A.B. May 15, 2007) (“[O]pposer has not demonstrated that the registration of applicant’s mark will dilute its BIG GULP trademark.”). 101 National Pork Board and National Pork Producers Council v. Supreme Lobster and Seafood Company, 96 U.S.P.Q.2d 1479, 1496 (T.T.A.B. 2010).

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§ 1.02[6]

be that with a greater number of federal decisions interpreting the TDRA and giving this statute and cause of action more weight, the TTAB will decide to sustain this type of claim with more frequency against trademark applications and registrations.101.1 To establish a likelihood of blurring or likelihood of tarnishment claim before the TTAB, the opposer must assert that its mark became famous prior to the filing date of the application in question if it has been filed on an intent-to-use basis, or before the reported first use date of the mark for a use-based application.102 Evidence of fame may consist of sales, advertising and promotion expense figures; testimony about the extent and nature of promotional efforts; and non-litigation market research surveys showing a high degree of consumer recognition and references to the mark in third-party literature and in popular culture, such as television talk shows.103 In one proceeding, the TTAB found that while a mark did have sufficient fame to be protected under the TDRA, it may not have had sufficient evidence on the “degree of recognition of the famous mark” factor to establish blurring.104 For example, the TTAB determined that 7-Eleven’s BIG GULP mark for beverages did not have the degree of recognition necessary to establish blurring, even though it qualified as a famous mark.105 Therefore, a claimant must be ready to establish and differentiate between both types of fame before the TTAB.106 The fame necessary to support an opposition or cancellation proceeding must rely on use of a name or mark in the United States, unless the opposer or petitioner is relying on an intent-to-use pleading, a U.S. application to register and evidence of use outside the United States that has created a basis within the United States for both widespread recognition of the name or mark and an association of that name or mark with the relevant goods or services.107

101.1 See, e.g., Research in Motion Limited v. Defined Presence Marketing Group, Inc., 2012 WL 893481 at *14 (T.T.A.B. Feb. 27, 2012) (opposition sustained in part based on likelihood of dilution by blurring). 102 Polaris Industries Inc. v. DC Comics, 2000 TTAB LEXIS 816, at *7 (T.T.A.B. Nov. 30, 2000); Toro Co. v. Toro Head Inc., 2001 TTAB LEXIS 823, at *32 (T.T.A.B. Dec. 12, 2001); National Pork Board and National Pork Producers Council v. Supreme Lobster and Seafood Co., 96 U.S.P.Q.2d 1479, 1496-1497 (T.T.A.B. 2010). 103 National Pork Board and National Pork Producers Council v. Supreme Lobster and Seafood Company, 96 U.S.P.Q.2d 1479, 1495-1496 (T.T.A.B. 2010). See also, Research in Motion Limited v. Defined Presence Marketing Group, Inc., 2012 WL 893481 at *9 (TTAB Feb. 27, 2012). 104 7-Eleven, Inc. v. Wechsler, 2007 TTAB LEXIS 58, at *51-*52 (T.T.A.B. May 15, 2007). 105 Id. 106 Id. 107 Fiat Group Automobiles S.p.a. v. ISM, Inc., 2010 WL 956670, at *5, TTAB LEXIS 70, at *14 (T.T.A.B. March 15 2010); see also, Rolex Watch U.S.A., Inc., v.

(Rel. 2)

§ 1.02[6]

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Even prior to the TDRA, the TTAB recognized claims for likelihood of blurring and likelihood of tarnishment.108 The TTAB had a relatively tough standard regarding similarity of marks, as it required them to be “essentially the same” or “substantially similar.”109 However, in a more recent case, the TTAB found likelihood of dilution where the marks contained different words: THE OTHER RED MEAT for applicant’s salmon and THE OTHER WHITE MEAT for registrant’s services and goods related to the promotion of pork.110 The TTAB found that the “two marks involved herein are highly similar, having the same structure and cadence and three of the same words. The difference involves only the third of the four words, which in both cases is an adjective referring to a color of meat, of which there are precious few from which to choose. Both slogans elicit the same mental processing, namely, a comparison of the promoted meat with another kind of meat.”111 In a case involving the ROLEX mark for watches, the TTAB explicitly acknowledged that it would follow the lead of the Courts of Appeals of the Second and Ninth Circuits and apply a less demanding standard for similarity than previously employed by courts interpreting the FTDA.112 In particular, the TTAB stated that the test it would apply asks whether the parties’ marks are “‘sufficiently similar to trigger consumers to conjure up a famous mark when confronted with the second mark.’”113 Nonetheless, the TTAB still found no likelihood of dilution between ROLEX for watches and ROLL-X for xray tables for medical and dental use despite the more liberal

AFP Imaging Corp., 2011 WL 6780738 at *4-*6, 2011 TTAB LEXIS 378, at *13 (T.T.A.B. Dec. 5, 2011), vacated on other grounds 2013 TTAB LXIS 46 (T.T.A.B. Jan. 29, 2013) (ROLEX is a famous mark for dilution purposes based on use and promotional activities in the United States). 108 The Nasdaq Stock Market, Inc. v. Antartiza, S.R.L., 2003 WL 22021943, at *19-*23 (T.T.A.B. June 30, 2003) (applying likelihood of dilution standard); Hormel Foods v. Spam Arrest, 2005 TTAB LEXIS 144 (T.T.A.B. March 31, 2005) (not citable as precedent) (likelihood of tarnishment). 109 7-Eleven, Inc. v. Wechsler, 2007 TTAB LEXIS 58, at *49-*50 (T.T.A.B. May 15, 2007). 110 National Pork Board and National Pork Producers Council v. Supreme Lobster and Seafood Co., 96 U.S.P.Q.2d 1479, 1495-1498 (T.T.A.B. 2010). 111 Id., 96 U.S.P.Q.2d at 1497; see also, Research in Motion Limited v. Defined Presence Marketing Group, Inc., 2012 WL 893481 at *10-*11 (T.T.A.B. Feb. 27, 2012) (high degree of similarity between CRACKBERRY and BLACKBERRY). 112 Rolex Watch U.S.A., Inc., v. AFP Imaging Corp., 2011 WL 6780738 at *7-*8, 2011 TTAB LEXIS 378 (T.T.A.B. Dec. 5, 2011), vacated on other grounds 2013 TTAB LEXIS 46 (T.T.A.B. Jan. 29, 2013). 113 Id. at *8 (citing National Pork Board and National Pork Producers Council v. Supreme Lobster and Seafood Co., 96 U.S.P.Q.2d 1479, 1497 (T.T.A.B. 2010)).

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§ 1.02[7]

approach to finding similarity.114 The TTAB also considered the question of association between the applied-for mark and the famous ROLEX mark, and found that a survey showing an association of 42% insufficient where 50% found that a feature of the goods came to mind.115 Finally, proving likelihood of dilution, and specifically, that an association between the applied for mark and the famous mark impairs the distinctiveness of the famous mark, is especially difficult against applications filed on an intent-to-use basis.116 [7]—Exclusions and Defenses Under the TDRA [a]—Fair Use The TDRA excludes the following from liability under its terms: (A) Any fair use, including a nominative or descriptive fair use, or facilitation of such fair use, of a famous mark by another person other than as a designation of source for the person’s own goods or services, including use in connection with — (i) advertising or promotion that permits consumers to compare goods or services; or (ii) identifying and parodying, criticizing, or commenting upon the famous mark owner or the goods or services of the famous mark owner; (B) All forms of news reporting and news commentary; and (C) Any noncommercial use of a mark.117 This reference to “other than as a designation of source” appears to disqualify from consideration under this defense use of a mark or trade name in connection with the sale of goods or services, as a mark or trade name is by definition a “designation of source.”117.1 The “facilitation” of fair use language, aimed at avoiding secondary liability, is redundant because the underlying fair use would not be actionable, so any facilitation of that could not be actionable either.118

114

Rolex Watch U.S.A., Inc., v. AFP Imaging Corp., 2011 WL 6780738 at *12, 2011 TTAB LEXIS 378 (TTAB Dec. 5, 2011), vacated on other grounds 2013 TTAB LXIS 46 (T.T.A.B. Jan. 29, 2013). 115 Id. at *27. 116 Id. at *29. 117 15 U.S.C. § 1125(c)(3). 117.1 See Rosetta Stone Ltd. v. Google, Inc., 676 F.3d 144, 169 (4th Cir. 2012) (“[T]he district court erred when it ruled that Google was not liable for dilution simply because there was no evidence that Google uses the Rosetta Stone marks to identify Google’s own goods and services.” The court determined that the fair use defense may not apply where the source identifiers are used as keyword triggers for paid advertisements and within the title and text of paid advertisements). 118 McCarthy, 4 McCarthy on Trademarks and Unfair Competition, § 24:124 (4th ed. 2011).

(Rel. 2)

§ 1.02[7]

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The reference to “nominative” fair use derives from a Ninth Circuit doctrine that recognizes, in perhaps its simplest form, that a reference to another party’s product does not constitute a violation.119 But there are other interpretations of this doctrine that are less clear.120 One court found that online reseller eBay’s use of TIFFANY constituted a nominative fair use, because eBay merely listed items for sale that were designated by unrelated third parties, and not eBay, with plaintiff’s TIFFANY mark.121 The scope of the parody exemption in the TDRA is unclear. In particular, the Fourth Circuit upheld a finding that there was no likelihood of dilution or tarnishment over the use of CHEWY VUITON for defendant’s stuffed toys and beds for dogs as against LOUIS VUITTON, the maker of a variety of luxury goods.122 The court found that “[w]hile a parody intentionally creates an association with the famous mark in order to be a parody, it also intentionally communicates, if it is successful, that it is not the famous mark, but rather a satire of the famous mark.”123 In this case, the court found that defendant’s use was a protected parody, even though the company used the term as a designation of source for its products. The court essentially determined that a mark may be a protected parody, outside of the specific constraints mandated by the TDRA against the application of this exemption to terms used as designations of source, if it communicates “that it is not the famous mark,” but rather a satire of the famous mark.124 The Second Circuit determined that the fair use defense in the TDRA did not apply to a dispute between the famous STARBUCKS mark for coffee and MISTER CHARBUCKS for coffee products.125 Defendant’s use of MISTER CHARBUCKS was not eligible for protection as a parody because it was used as a designation of source, or,

119 See, e.g.: Second Circuit: Tiffany (NJ) Inc. v. eBay, Inc., 600 F.3d 93, 102-103 (2d Cir. 2010) (discussing nominative fair use doctrine generally and its treatment by other federal circuit courts). Ninth Circuit: Playboy Enterprises, Inc. v. Welles, 279 F.3d 796, 806 (9th Cir. 2002) (application of nominative fair use defense). 120 Tiffany (NJ) Inc. v. eBay, Inc., 600 F.3d 93, 102-103 (2d Cir. 2010) (discussing nominative fair use doctrine generally and its treatment by other federal circuit courts). 121 Tiffany Inc. v. eBay, Inc., 576 F. Supp.2d 463, 521 (S.D.N.Y. 2008), aff’d in part on other grounds, remanded in part on other grounds 600 F.3d 93 (2d Cir. 2010). 122 Louis Vuitton Malletier S.A. v. Haute Diggity Dog LLC, 507 F.3d 252, 267268 (4th Cir. 2007). 123 Id. 124 Id. (emphasis in original); but see, Research in Motion Limited v. Defining Presence Marketing Group, Inc., 2012 WL 893481 at *12-*14 (T.T.A.B. Feb. 27, 2012) (parody defense rejected because claimed parody is not effective) 125 Starbucks Corp. v. Wolfe’s Borough Coffee, Inc., 588 F.3d 97, 111-112 (2d Cir. 2009).

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§ 1.02[7]

alternatively, if it was eligible for protection under the Fourth Circuit’s rationale, it was too subtle a parody.126 Significantly, the Second Circuit did not explicitly accept or reject the Fourth Circuit’s holding that the parody defense exists outside the specific terms of the TDRA.127 The other forms of fair use, such as comparative advertising,128 criticism,129 and news reporting, which are fairly traditional forms of expression that arguably would be covered by the First Amendment, are also covered here.130 The noncommercial use exception arguably helps artists and authors who use famous marks in their works either avoid litigation or find a quick way to bring a case to an end.131 Finally, courts also will recognize equitable defenses, such as laches, acquiescence and waiver, that are not specifically mentioned in the TDRA.132 [b]—Ownership of a Federal Registration Excludes a State Law Anti-Dilution Claim The TDRA bars state trademark anti-dilution law claims against federally registered marks.133 Due to a drafting error, registration also was a bar against federal anti-dilution claims until the TDRA was amended to fix the mistake on October 5, 2012.134 The new amendment is not retroactive, which means that the prior bar against federal anti-dilution claims may persist for claims brought before October 5, 2012.135-138

126

Id., 588 F.3d at 113. Id. In a subsequent ruling on remand, the district court found no likelihood of dilution by blurring. Starbucks Corp. v. Wolfe’s Borough Coffee, Inc., 2011 WL 6747431 at *6, 2011 U.S. Dist. LEXIS 148081, at *15 (S.D.N.Y. Dec. 23, 2011). 128 Rosetta Stone Ltd. v. Google, Inc., 676 F.3d 144, 167-168 (4th Cir. 2012) (use in comparative advertising or promotion excluded from dilution liability). 129 Cf., Nissan Motor Co. v. Nissan Computer Corp., 378 F.3d 1002, 1017-1018 (9th Cir. 2004) (criticism protected against FTDA claim). 130 Shelby v. Factory Five Racing, Inc., 684 F. Supp.2d 205, 216-217 (D. Mass. 2010) (discussion of fair use). 131 Cf., McGeveran, “The Trademark Fair Use Reform Act,” 908 B.U. L. Rev. 2267, 2276 (2010) (“It is bad enough that the structure of existing fair use doctrines imposes such significant difficulties and costs on expressive uses of trademarks.”). 132 See, e.g.: Eighth Circuit: Roederer v. J. Garcia Carrion, S.A., 2010 WL 489529, 2010 U.S. Dist. LEXIS 9473 (D. Minn. Feb. 4, 2010) (laches, equitable estoppel, acquiescence and waiver). Ninth Circuit: Saul Zaentz Co. v. Wozniak Travel, Inc., 627 F. Supp.2d 1096, 1109-1110 (N.D. Cal. 2008) (laches defense). See generally, Hilliard, Welch and Marvel, Trademarks & Unfair Competition Deskbook, §7.02-7.03 (5th ed. 2011) (discussion of equitable defenses). 133 15 U.S.C. §1125(c)(6). 134 Trademark Act of 1946, Pub. L. no. 112-190, §1, 126 Stat. 1436 (2012). 135-138 Id.; see Under Armour, Inc. v. Evade, LLC, 2013 WL 2365036, at *3-*4, 2013 TTAB LEXIS 74, at *9 (T.T.A.B. Feb. 14, 2013) (“Act only applies prospectively to actions which commenced on or after October 5, 2012”). 127

(Rel. 2)

§ 1.02[8]

TRADEMARK LAW

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[8]—Remedies Under the TDRA The TDRA provides for injunctive and monetary relief. The provision for injunctive relief states: Subject to the principles of equity, the owner of a famous mark that is distinctive, inherently or through acquired distinctiveness, shall be entitled to an injunction against another person who, at any time after the owner’s mark has become famous, commences use of a mark or trade name in commerce that is likely to cause dilution by blurring or dilution by tarnishment of the famous mark, regardless of the presence or absence of actual or likely confusion, of competition, or of actual economic injury.139 “The text of the federal statute is clear and unambiguous: the owner of a famous, distinctive mark that is diluted is entitled to an injunction.”140 This includes preliminary injunctions.140.1 Dilution of a trademark is remarkably difficult to convert into damages.141 With regard to monetary relief, the TDRA provides that the owner of the famous mark is entitled to monetary relief where the mark was first used without prior approval in commerce after the statute’s effective date of October 6, 2006.142 Courts have routinely held, however, that the TDRA restricts the retroactive application of the likelihood of dilution standard with regards to monetary relief.143

139

15 U.S.C. §1125(c)(1). Dallas Cowboys Football Club, Ltd. v. America’s Team Properties, 616 F. Supp.2d 622, 646 (N.D. Tex. 2009). (Emphasis in original.) See also, Starbucks Corp. v. Wolfe’s Borough Coffee Inc., 477 F.3d 765 (2d Cir. 2007) (TDRA standard of likelihood of dilution applied where senior user of mark sought injunctive relief prior to amendment of FDTA statute). 140.1 CrossFit, Inc. v. Maximum Human Performance, LLC, 2013 WL 627953 at *3-*4, 2013 U.S. Dist. LEXIS 53616, at *7 (S.D. Cal. April 12, 2013). 141 Lincoln Financial Advisors Corp. v. Sagepoint Financial Inc., 2009 WL 928993 at *12, 2009 U.S. Dist. LEXIS 28142, at *19 (N.D. Ind. April 2, 2009) (citing Kraft Foods Holdings, Inc. v. Helm, 205 F. Supp.2d 942, 950 (N.D. Ill. 2002)). (Citation and quotation marks omitted.) 142 15 U.S.C. §1125(c)(5)(A). 143 See: Burberry Ltd. v. Euro Moda, Inc., 2009 WL 1675080 at *9, 2009 U.S. Dist. LEXIS 53250, at *24 (S.D.N.Y. June 10, 2009) (“the more lenient standard of the TDRA will only apply to pre-October 6, 2006 conduct to the extent that a plaintiff seeks injunctive relief, and not money damages”); see also, Louis Vuitton Malletier v. Dooney & Bourke, 500 F. Supp.2d 276, 283 (S.D.N.Y. 2007) (“The second sentence of subsection 1125(c)(5), entitling owners of famous marks to dilution damages, contains an unambiguous date restriction that authorizes the application of the “likelihood of dilution” standard as a basis for recovering damages to civil actions where the diluting mark or trade name was first introduced in commerce after October 6, 2006.”). (Emphasis in original.) 140

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§ 1.02[8]

Therefore, claims for damages for actions that pre-date the TDRA are still governed by the FTDA.144 Under the Lanham Act, monetary relief in the form of damages, defendant’s profits, or costs are available if a defendant in a case of dilution by blurring “willfully intended to trade on the recognition of the famous mark,” or in a case of dilution by tarnishment “willfully intended to harm the reputation of the famous mark.”145 Significant monetary judgments under the law are possible, while an enhancement under the Lanham Act is subject to the court’s discretion and is an option where the plaintiff can show an uncompensated loss.145.1 As elaborated upon by Professor McCarthy, “in the author’s view, monetary recovery for dilution requires some proof that the famous mark was in fact injured or harmed by the defendant’s conduct. In addition, the plaintiff needs to present some reasonable method of measuring that damage.”146 In addition, an award of attorneys’ fees is available where plaintiff can show that it is an exceptional case.147

144 Haynes International, Inc. v. Electralloy, 2009 WL 789918 at *21, 2009 U.S. Dist. LEIS 24365, at *54 (W.D. Pa. March 23, 2009). 145 15 U.S.C. §1125(C)(5)(B); See, 15 U.S.C. §1117(a); see also, Adidas America, Inc. v. Payless Shoesource, Inc., 546 F. Supp.2d 1029, 1066 (D. Ore. 2008) (evidence of intent sufficient to show willfulness needed for monetary relief). 145.1 Apple, Inc. v. Samsung Electronics Co., Ltd., 2013 WL 412862, at *3-*4, 2013 U.S. Dist. LEXIS 13238 (N.D. Cal. Jan 29, 2013). 146 McCarthy, 4 McCarthy on Trademarks and Unfair Competition, § 24:132 (4th ed. 2011). 147 15 U.S.C. § 1117(a); Horphag Research Ltd. v. Garcia, 475 F.3d 1029, 1039 (9th Cir. 2007).

(Rel. 2)

§ 1.03

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§ 1.03 State Dilution and Tarnishment Statutes Approximately three-fourths of the states have some form of dilution statute.1 State dilution statutes first appeared in the 1940’s.2 With the stringent fame requirements under the TDRA, the state statutes may fill the gap by protecting marks that have achieved fame in only that state or a relatively limited geographic area.3 The scope of protection differs from state to state, but usually covers both dilution by blurring and by tarnishment.4 For example, New York’s statute has both forms of protection, but no explicit fame requirement.5 The Second Circuit has underscored the differences between the New York dilution statute and the TDRA, by finding that the marks MISTER CHARBUCKS and STARBUCKS for coffee products were similar under the TDRA, but not so under the New York statute because it requires that marks be “substantially similar.”6 In California, the legislature amended the statute after the International Trademark Association created a revised model bill that reflected the TDRA, but with an accommodation to state practice.7 The Texas statute also has a likelihood of dilution standard.7.1 In Illinois, the statute still requires proof of actual dilution, mirroring the law under the FTDA, despite the federal law’s amendment to likelihood of dilution under the TDRA.8 Georgia law enjoins similar marks where

1 International Trademark Law Ass’n, U.S. State Trademark and Unfair Competition Law (2013). See also, § 1.05 infra. 2 Wong, “Big Business In Their Belfry? Congress to Dumb Down Dilution,” 6 Loy. Law & Tech. Ann. 43, 50 (2006). 3 Field of Screams, LLC v. Olney Boys and Girls Community Sports Ass’n, 2011 WL 890501, at *8-*9, 2011 U.S. Dist. LEXIS 25635, at *28 (D. Md. March 14, 2011) (dilution claim under Pennsylvania law may proceed but not TDRA claim). 4 Id.; see also, Community of Christ Copyright v. Devon Park, 683 F. Supp.2d 1006, 1116-1117 (W.D. Mo. 2010) (likelihood of injury to business reputation and dilution of the distinctive quality of a mark protected under Missouri law). 5 N.Y. Gen. Bus. Law § 360; Starbucks Corp. v. Wolfe’s Borough Coffee, Inc., 588 F.3d 97, 114 (2d Cir. 2009); see also: Louis Vuitton Malletier, S.A. v. Hyundai Motor America, 2012 WL 1022247 at *15, 2012 U.S. Dist. LEXIS 42793 (S.D.N.Y. March 22, 2012); The Estate of Ellington v. Harbrew Imports Ltd., 2011 WL 4373937, at *4, 2011 U.S. Dist. LEXIS 105519 (S.D.N.Y. Sept. 19, 2011). 6 Starbucks Corp., 588 F.3d at 113-114. See also, Akiro LLC v. House of Cheatham, Inc., 2013 WL 2181088 at *14-*15, 2013 U.S. Dist. LEXIS 72233 (S.D.N.Y. May 17, 2013) (MISS JESSIE’S and AUNT JACKIE’S not sufficiently similar under the New York statute). 7 Levi Strauss & Co. v. Abercrombie & Fitch Trading Co., 633 F.3d 1158, 1167 n.6 (7th Cir. 2011) (citing McCarthy, 3 McCarthy on Trademarks and Unfair Competition, § 22:6.25 (4th ed. 2010)). 7.1 S&H Industries, Inc. v. Selander, 2013 WL 1131077, at *7-*8, 2013 U.S. Dist. LEXIS 38694, at *19-*20 (N.D. Tex. March 19, 2013). 8 Autozone, Inc. v. Strick, 466 F. Supp.2d 1034, 1044 n.5 (N.D. Ill. 2006) rev’d on other grounds 543 F.3d 923 (7th Cir. 2008) (citing 765 ILCS § 1036/65(a)).

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§ 1.03

there exists likelihood of injury to business reputation or of dilution to the distinctiveness of a mark.9 In Pennsylvania, the state statute protects marks that are famous within the state, but otherwise its provisions are similar to those for the TDRA.10 New Mexico also requires proof that a mark is famous in New Mexico to sustain a claim under its statute.10.1 If the defendant owns a federal registration in a mark it cannot be challenged through state anti-dilution laws under the TDRA.11 There is no claim for dilution or tarnishment under most state statutes if the defendant is not using the term in question as a mark for the sale of goods or services.12 Finally, it is possible for a state dilution statute to be preempted by federal patent law over the question of protecting trade dress in a pattern or shape that is not subject to a patent, such as a shoe design, but is patentable.13

9 PepsiCo, Inc. v. #1 Wholesale, LLC, 2007 WL 2142294, 2007 U.S. Dist. LEXIS 53768 (N.D. Ga. July 20, 2007); Ga. Code Ann. § 10-1-451(b). 10 Field of Screams, LLC v. Olney Boys and Girls Community Sports Ass’n, 2011 WL 890501 at *8-*9, 2011 U.S. Dist. LEXIS 2567, at *28 (D. Md. March 14, 2011). 10.1 Navajo Nation v. Urban Outfitters, Inc., 2013 WL 1294670 at *26, 2013 U.S. Dist. LEXIS 50557, at *77 (D.N. Mex. March 29, 2013). 11 15 U.S.C. § 1125 (c)(6). 12 McCarthy, 4 McCarthy on Trademarks and Unfair Competition § 24:122 (4th ed. 2009). 13 Adidas America, Inc. v. Payless Shoesource, Inc., 546 F. Supp.2d 1029, 10661068 (D. Ore. 2008) (citing Escada AG v. The Limited, Inc., 810 F. Supp. 571 (S.D.N.Y. 1993)).

(Rel. 2)

§ 1.04

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§ 1.04 Where Does the Law Go from Here? Federal dilution law has undergone significant changes in recent years and continues to evolve. As courts adjust to the new language of the TDRA, brand owners should consider state dilution laws as a viable option where the TDRA may not be available because of its tough fame requirements. The federal and state dilution laws offer brand owners an option in protecting their rights where there is no likelihood of confusion to support trademark infringement or unfair competition claims, but, once again, the tougher fame standard under dilution law should give some brand owners pause before proceeding with a suit on this basis. Ultimately, it may be damaging to bring a claim under the dilution laws and lose because a mark is deemed not famous enough, with the consequent precedent announcing to the world that the mark is weak. Thus, the dilution laws should be used sparingly, and for clearly famous marks. For state dilution claims, the risk of the negative precedent is somewhat smaller because of their limited scope. Given the protection offered to federally registered marks under the TDRA, specifically the shield federal registration provides against state dilution law claims, there is a greater incentive to obtain such protection. Overall, dilution law should become more predictable for brand owners once courts adjust to the changes implemented through the TDRA. Concerns about the breadth of protection afforded marks under the dilution laws also may fade, as courts recognize the limitations on its scope.

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§ 1.05

§ 1.05 State Trademark Anti-Dilution Laws Chart State

Statutory Definitions

Remedies/Relief

ALABAMA

Ala. Code 1975 § 8-12-6. Definitions.

Ala. Code 1975 § 8-12-17. Injunctive relief; famous marks.

(2) Dilution. Dilution by blurring or dilution by tarnishment, regardless of the presence or absence of: a. Competition between the owner of the famous mark and other parties, or b. Actual or likely confusion, mistake, or deception, or c. Actual economic injury. (3) Dilution by blurring. The association arising from the similarity between a mark and a famous mark that impairs the distinctiveness of the famous mark. (4) Dilution by tarnishment. The association arising from the similarity between a mark and a famous mark that harms the reputation of the famous mark.

(a) Subject to the principles of equity, the owner of a mark which is famous and distinctive, inherently or through acquired distinctiveness, in this state shall be entitled to an injunction against another person's commercial use of a mark, if such use begins after the famous mark has become famous and is likely to cause dilution of the famous mark, and to obtain such other relief as is provided in this section. (b) A mark is famous if it is widely recognized by the general consuming public of this state or a significant geographic area in this state as a designation of source of the goods or services or the business of the mark's owner. In determining whether a mark is famous, a court may consider factors such as, but not limited to:

(Rel. 2)

§ 1.05

State ALABAMA (cont’d.)

TRADEMARK LAW

Statutory Definitions

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Remedies/Relief (1) The duration, extent, and geographic reach of advertising and publicity of the mark in this state, whether advertised or publicized by the owner or third parties.

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