From PLI’s Treatise

Trademark Law: A Practitioner’s Guide

By Siegrun D. Kane

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Chapter 9

The Evolution of Dilution:
Survival of the Strongest

§ 9:1     Overview

§ 9:1.1      Dilution Before the Supreme Court Victoria’s Secret Decision

§ 9:1.2      The Victoria’s Secret Decision

§ 9:2     Dilution Under State Law

§ 9:2.1      Dilution Defined

§ 9:2.2      The State Statutes Mean What They Say— Confusion and Competition Are Not Required

§ 9:2.3      Elements of a Dilution Cause of Action Under Early State Statutes

[A]      Requirement of Distinctiveness

[B]      Requirement of Likely Dilution

§ 9:2.4      The Role of Intent

§ 9:2.5      Remedies

§ 9:3     Dilution Under the Federal Trademark Dilution Act (FTDA)

§ 9:3.1      The Movement Toward National Protection

§ 9:3.2      Purpose of the FTDA

§ 9:3.3      Dilution Defined

§ 9:3.4      Elements of a Dilution Cause of Action Under the FTDA

[A]      “Famous” Mark Requirement

[B]      Adoption After Plaintiff’s Mark Became Famous

[C]      Commercial Use in Commerce

[D]      Dilution of the Distinctive Quality of Plaintiff’s Famous Mark

§ 9:3.5      Actual Harm Requirement

[A]      The Split in the Circuits

[B]      The Supreme Court Speaks:
Victor/Victoria—A Play in Three Acts

[C]      Supreme Court’s View of Dilution: Actual Harm Is Required

[D]      Identical Versus Nonidentical Marks:
A Distinction with a Difference

[E]      What Else the Court Said

§ 9:3.6      Remedies

§ 9:3.7      Defenses

[A]      Federal Registration Defense

[B]      Fair Use and First Amendment Defenses Under Section 43(c)

[C]      Fair Use Under Section 33(b)(4)

§ 9:4     Dilution in Patent and Trademark Office Proceedings

§ 9:5     The Continuing Evolution of the Species

§ 9:5.1      Protection of Niche Marks

§ 9:5.2      Meaning of “Distinctive and Famous”

[A]      Are “Distinctive” and “Famous” Two Separate Requirements?

[B]      Does the FTDA Protect Marks That Have Acquired Distinctiveness Through Secondary Meaning?

§ 9:5.3      Role of Dilution Factors

§ 9:5.4      Protection of Product Design Trade Dress

§ 9:5.5      Dilution and Retroactivity: It’s Not Over Till the Highest Court Sings

§ 9:5.6      Role of Tarnishment

§  9:1      Overview

Trademark law is intended to (1) secure the goodwill of the trademark owner’s business; and (2) protect the ability of consumers to distinguish among competing producers by prohibiting uses that are likely to cause confusion, mistake, or deception.1 Dilution law, on the other hand, is intended to protect the value and uniqueness of plaintiff’s mark without the need to show likelihood of confusion.2

§  9:1.1           Dilution Before the Supreme Court Victoria’s Secret Decision

Dilution law was originally the creature of state statutes. The “evil” that the state dilution statutes sought to remedy was

not public confusion caused by similar products or services sold by competitors, but a cancer-like growth of dissimilar products or services which feeds upon the business reputation of an established distinctive trade-mark or name.3

Massachusetts enacted the first state dilution statute in 1947.4 By the late 1950s about two dozen states had passed dilution statutes. These statutes provided injunctive relief for dilution of the “distinctive quality” of plaintiff’s mark “notwithstanding the absence of competition between the parties or the absence of confusion as to the source of goods or services.”5

At first, courts interpreting state dilution statutes were slow to grant dilution protection where plaintiff failed to prove likely confusion. Eventually, the courts accepted that there really is a dilution cause of action and even began to extend protection to marks that were not well known to the general public.6

As an increasing number of states adopted dilution statutes, efforts were directed to enactment of a federal statute that would provide (1) dilution protection regardless of the jurisdiction where suit was brought and (2) nationwide injunctive relief.7 These efforts succeeded when the Federal Trademark Dilution Act (FTDA) became law in January 1996.

But even as dilution ascended the national stage, courts were becoming leery of extending dilution protection, for example, to marks that were not truly famous.8 As the Supreme Court decision in the Victoria’s Secret case loomed on the horizon, the debate over the proper scope of dilution intensified. However, while Victoria’s Secret stimulated discussion of many aspects of dilution, the specific issue before the Supreme Court was a limited one.

The Supreme Court granted certiorari in Victoria’s Secret to decide whether “objective proof of actual injury to the economic value of a famous mark (as opposed to a presumption of harm arising from a subjective ‘likelihood of dilution’ standard) is a requisite for relief under the FTDA.”9

§  9:1.2           The Victoria’s Secret Decision

After reviewing the purpose and history of dilution law, the Court in Victoria’s Secret held that proof of actual harm (actual dilution) as opposed to likely dilution, was required under the FTDA. The decision was based on the FTDA language “causes dilution,” which differed from the “likelihood . . . of dilution” language of the state statutes.

The Court equated proof of actual harm with proof that defendant’s use affects the consumer’s conception of plaintiff’s mark. It is not sufficient that defendant’s mark triggers a mental association with plaintiff’s mark. At least in the situation where defendant’s mark is not identical, plaintiff must prove that defendant’s mark has an impact on the strength of plaintiff’s mark.10

While requiring proof of actual harm under the FTDA, the Court also indicated that (1) proof of the economic consequences of the harm, for example, lost sales or profits, is not required, and (2) use of a mark identical to a famous mark may by itself be circumstantial proof of actual harm.11

Although there is no doubt that dilution survives after Victoria’s Secret, weaker members of the species (for example, more tenuous claims involving dissimilar marks) may be in danger because of the difficulties of proving actual harm.

To fully understand what the Supreme Court did and did not decide in Victoria’s Secret and the implications for future dilution claims, we need to look at the history of dilution protection under state law.

§  9:2   Dilution Under State Law

§  9:2.1           Dilution Defined

Dilution is characterized as a “whittling down” of the identity or reputation of a trade name or mark.12 To put it another way, dilution corrodes a trademark by “blurring its product identification or by damaging positive associations that have attached to it.”13

§  9:2.2           The State Statutes Mean What They Say— Confusion and Competition Are Not Required

The New York statute, enacted in 1961, uses language typical of statutes in other states that were enacted before the FTDA. It reads:

Likelihood of injury to business reputation or of dilution of the distinctive quality of a mark or trade name shall be a ground for injunctive relief in cases of infringement of a mark registered or not registered or in cases of unfair competition, notwithstanding the absence of competition between the parties or the absence of confusion as to the source of goods or services.14

For many years courts interpreted the dilution statutes as though competition and confusion were required—despite the explicit statutory language to the contrary.15 Those cases that did find dilution did so only after a finding of confusion.16 The reverse was also true; those cases that did not find confusion did not find dilution.17 This “tying” phenomenon continued even after courts began to acknowledge that dilution did not require confusion.18

The Pillsbury case was one of the first cases to make a clear distinction between the confusion and dilution causes of action. After a thorough review of the pertinent confusion factors, the court determined that confusion was not likely, but upheld plaintiff’s dilution claim.19

There is no doubt now that the state statutes mean what they say: “Neither competition between the parties nor confusion about the source of products is necessary to state a cause of action for dilution.”20 As noted by the Second Circuit, “injury to a recognized trade name, rather than damage arising from confusion among consumers, lies at the heart of the wrong.”21

The next question, of course, is what is necessary?

§  9:2.3           Elements of a Dilution Cause of Action Under Early State Statutes

State dilution statutes enacted before the FTDA required that:

1.     the mark or name be of “distinctive quality”; and

2.     there be likelihood of dilution.22

Over a dozen states, including New York and California, retain the original statutory language. More than twenty state statutes enacted or amended after passage of the FTDA have adopted the FTDA requirements that the mark be famous and that defendant’s use “cause dilution.”23

[A]        Requirement of Distinctiveness

It is still unsettled as to just how distinctive a mark must be to qualify for protection against dilution under the original state statutes. Some commentators have suggested that only “famous” or “celebrated” marks should be protected.24 The Restatement of Unfair Competition uses the term “highly distinctive” in describing a mark eligible for dilution protection under state statutes.25 Other authorities phrased the test this way: The mark must be “truly of distinctive quality or have a secondary meaning in the mind of the public.”26

Examples of well-known marks protected under the pre-FTDA state statutes include:

Cabbage Patch Kids for dolls versus Garbage Pail Kids on bubble gum cards;27

American Express card versus America Express mock credit card with condom and slogan Never Leave Home Without It;28

Coca-Cola bottle shape versus Mad Scientist Magic Powder bubble gum in plastic container shaped like Coke bottle,29 and

John Deere deer logo versus an altered version showing a small, frightened deer running away from the Yard-Man lawn tractor.30

Less well-known marks protected under the original state statutes include:

Cinnabar for beauty products versus Cinnabar for haircutting salon.31

Cookie Jar and design for banking services versus Cookie Jar and design for topless go-go bar.32

Wedgwood for residential real estate versus Wedgwood for retirement apartments.33

American United Life Insurance Co. for life and health insurance versus American United Insurance Co. for car insurance.34

[B]        Requirement of Likely Dilution

Case law under the state dilution statutes recognized two forms of dilution:

1.     The blurring of a mark’s product identification, which is defined as diminution in uniqueness of the mark,35 and

2.     The tarnishment of the affirmative associations a mark has come to convey.36

Blurring the Identity of a Mark: The blurring theory of dilution requires proof that the product-evoking quality of plaintiff’s mark is likely to be weakened by defendant’s mark.

In the Sally Gee case, the Second Circuit applied the New York state statute and found that Sally Lee did not blur the identity of Sally Gee—apparently because of the difference in marks.

Sophisticated retailers and discerning consumers of women’s apparel are unlikely to have blurred vision causing them to see “Sally Gee” upon viewing a Sally Lee label.37

The Second Circuit also rejected a claim of blurring under the New York state statute in the Lexis case. The court found there was no dilution of Lexis for computer legal research services by Lexus for automobiles because of different spelling and pronunciation and the lack of significant overlap between attorneys and automobile purchasers.38

In the Seventh Circuit Polaroid case, the court found defendant’s mark Polaraid for installation of refrigeration and heating systems likely to blur plaintiff’s mark Polaroid for optical devices and cameras. In applying the Illinois dilution statute, the court noted:

No longer would the word “Polaroid” call immediately to mind the highly regarded cameras made by the Polaroid Corporation. The mental image would be blurred, at least to anyone who had dealt with Polaroid or seen its ads, by recollection of Polaraid’s refrigeration services.39

The special nature of parody uses makes it difficult to find blurring. For example, in the Hormel Spam case, the obvious parody nature of the Muppet Spa’am King of the Wild Boars character was not likely to weaken the association between plaintiff’s mark Spam and its meat product.40 And even where blurring is found, dilution protection may not be granted to parody uses on First Amendment grounds.41

Tarnishment: A trademark may be tarnished when it is “linked to products of shoddy quality, or is portrayed in an unwholesome or unsavory context,” with the result that “the public will associate the lack of quality or lack of prestige in the defendant’s goods with the plaintiff’s unrelated goods.”42

Tarnishment was not found in Sally Gee because defendant’s clothing was higher in price and higher in quality than plaintiff’s clothing. A tarnishment argument was rejected in the Hormel Spam case because the Spa’am character from the Muppet Treasure Island movie did not convey a negative association to the Hormel Spam meat product. The court observed that Spam was already the butt of many jokes.43

Tarnishment, however, has been successfully established in a number of other cases. In Steinway, the piano people invoked California’s dilution statute to enjoin use of the name Stein-Way for beer can holders. The court stated:

Defendants’ use of the designation Stein-Way in connection with its business and its products, unless enjoined, will associate or tend to associate plaintiff’s high quality pianos and plaintiff’s business and cultural activities with defendants’ inexpensive, mass-produced products and with the retail liquor stores, supermarkets and similar merchandising concerns which sell defendants’ products. Such association will inevitably tarnish plaintiff’s reputation and image with the public of manufacturing and/or sponsoring only products and activities of taste, quality and distinction.44

In the early years, courts frequently found tarnishment where plaintiff’s mark was parodied in the context of obscene, illegal, or unsavory activity. For example, in the Pillsbury case, defendant’s magazine was enjoined under Georgia law from using the Pillsbury Doughboy and Doughgirl in lewd poses.45

Starting in the late 1980s, courts began to reject dilution claims where the parody was a “noncommercial” use, for example, contained in a literary context. The 1987 L.L. Bean case dealt with the L.L. Beam sex catalog parody of the L.L. Bean catalog. The First Circuit held the magazine parody noncommercial and protected by the First Amendment right to free speech.46 The L.L. Beam use was considered noncommercial in part because it was labeled as “humor” and “parody” in the magazine’s table of contents and neither the article nor L.L. Bean’s mark was featured on the magazine’s cover.47

§  9:2.4           The Role of Intent

Bad faith is not a prerequisite for finding dilution under state statutes. Bad faith is, however, a relevant factor, just as it is in any action seeking equitable relief.48

§  9:2.5           Remedies

The New York statute is again typical of the early state statutes in specifically providing that dilution “shall be a ground for injunctive relief.”49 The scope of the injunction, however, is in doubt. Some courts refuse to issue an injunction beyond the state’s borders.50 Other courts maintain that jurisdiction over the defendant empowers the court to restrain his actions nationwide, especially where plaintiff’s (and defendant’s) businesses are multistate.51

As to damages, the state statutes have been taken at face value: the exclusive reference to injunctive relief means that monetary relief is not available.52

§  9:3      Dilution Under the Federal Trademark Dilution Act (FTDA)

§  9:3.1           The Movement Toward National Protection

As acceptance of the dilution concept grew among courts applying state dilution statutes, trademark owners began to recognize dilution as a valuable alternative for the protection of distinctive marks.

The attractiveness of the dilution solution led to efforts to amend the Lanham Act to include a federal dilution provision in the Trademark Law Revision Act of 1988. These efforts were initially unsuccessful, possibly because of concern over use of the provision to stifle noncommercial expressions, for example, parody, satire, and editorial comment.53

The Federal Trademark Dilution Act (FTDA) that was finally enacted in 1996 excludes noncommercial uses such as parody, satire, and editorial expression from its reach.54

The FTDA adopted much of its language from state dilution statutes. The major differences are that the federal law:

1.     limits the dilution claim to famous marks;

2.     requires proof of actual dilution rather than likelihood of dilution;55

3.     provides nationwide injunctive relief;

4.     provides monetary relief in cases of “willful” dilution; and

5.     provides that defendant’s ownership of a federal registration acts as a bar to plaintiff’s dilution claims based on state statutory or common law.56

§  9:3.2           Purpose of the FTDA

The FTDA is intended to provide national uniformity by making a dilution claim available for famous marks regardless of the state where suit is brought and by providing nationwide injunctive relief:

Presently, the nature and extent of the remedies against trademark dilution varies from state to state and, therefore, can provide unpredictable and inadequate results for the trademark owner. The federal remedy provided in H.R. 1295 against trademark dilution will bring uniformity and consistency to the protection of famous marks. . . .57

§  9:3.3           Dilution Defined

The FTDA defines dilution as:

the lessening of the capacity of a famous mark to identify and distinguish goods or services, regardless of the presence or absence of—

(1)   competition between the owner of the famous mark and other parties, or

(2)   likelihood of confusion, mistake, or deception.58

§  9:3.4           Elements of a Dilution Cause of Action Under the FTDA

The FTDA provides the following cause of action:

The owner of a famous mark shall be entitled, subject to the principles of equity and upon such terms as the court deems reasonable, to an injunction against another person’s commercial use in commerce of a mark or trade name, if such use begins after the mark has become famous and causes dilution of the distinctive quality of the famous mark.59

To succeed on a federal dilution claim, plaintiff must prove that:

(1)   its mark is famous;

(2)   defendant is making commercial use in commerce;

(3)   defendant adopted its mark after plaintiff’s mark had become famous; and

(4)   defendant’s use dilutes the quality of plaintiff’s mark by diminishing the capacity of the mark to identify and distinguish goods and services.60

[A]        “Famous” Mark Requirement

The FTDA “famous” mark requirement appears to be a higher standard than the original state dilution requirement that the mark have a “distinctive quality.” Although some courts have interpreted “distinctive quality” as requiring an extremely strong mark, a mark may be strong in the sense of unique and arbitrary without being famous.61

The Act lists the following factors to consider in “determining whether a mark is distinctive and is famous”:

(A)  the degree of inherent or acquired distinctiveness of the mark;

(B)  the duration and extent of use of the mark in connection with the goods or services with which the mark is used;

(C)  the duration and extent of advertising and publicity of the mark;

(D)  the geographical extent of the trading area in which the mark is used;

(E)  the channels of trade for the goods or services with which the mark is used;

(F)  the degree of recognition of the mark in the trading areas and channels of trade used by the mark’s owner and the person against whom the injunction is sought;

(G)  the nature and extent of use of the same or similar marks by third parties;

(H)  whether the mark was registered under the Act of March 3, 1881, or the Act of February 20, 1905, or on the principal register.62

There is some dispute about the meaning of “distinctive” and “famous” as used in the FTDA. For example, the Second Circuit maintains that the term “distinctive” limits the categories of famous marks eligible for FTDA protection to inherently distinctive marks. Other authorities maintain that trademark law has always recognized distinctive marks as including marks that had acquired distinctiveness through use.63

Examples of marks protected under the FTDA include:

The Sporting News for weekly sports newspaper diluted by Las Vegas Sporting News for gambling newspaper;64

Wawa for chain of 500 convenience stores in five eastern states, in use for ninety years, diluted by the Haha market in Pennsylvania;65

Candyland for children’s game tarnished by “candyland.com” for website showing sexually explicit pictures;66

The green and yellow color scheme for Crayola markers, crayons, and related products likely to be diluted by green and yellow trade dress on defendant’s markers.67

Marks that did not qualify for FTDA protection include:

Columbia university (mark coexisted with a number of third party uses);68

Petro truck stop services (inadequate evidence to show mark was famous);69

Star Market chain of eight supermarkets in only one state (Hawaii).70

[B]        Adoption After Plaintiff’s Mark Became Famous

Section 1125(c)(1) of title 15 of the U.S.C. requires that defendant’s use “begins after the mark has become famous.”71

In Enterprise Rent-A-Car, the Federal Circuit held that prior use of a mark even in a limited geographic area defeats an opposition to registration based on dilution under 15 U.S.C. § 1063. The court noted that the Lanham Act provision governing opposition, 15 U.S.C. § 1063, explicitly incorporates the definition of dilution from the FTDA.72

[C]        Commercial Use in Commerce

The FTDA enables trademark owners to obtain “an injunction against another person’s commercial use in commerce of a mark.”73 This provision reflects Congress’s intent that the FTDA:

[incorporate] the concept of “commercial” speech from the “commercial speech” doctrine, and [proscribe] dilution actions that seek to enjoin use of famous marks in “non-commercial” uses (such as consumer product reviews).74

[D]        Dilution of the Distinctive Quality of Plaintiff’s Famous Mark

Cases under the FTDA, like cases under the state statutes, have recognized that dilution generally occurs in one of two ways: blurring or tarnishment.75 The issue before the Supreme Court in Victoria’s Secret was whether the statutory language “causes dilution of the distinctive quality of the famous mark” required a showing of actual dilution (actual harm) or only a likelihood of dilution.

§  9:3.5           Actual Harm Requirement

[A]        The Split in the Circuits

Many authorities had assumed that since the FTDA was enacted to provide a national dilution remedy along the lines of the state statutes, the FTDA required only likelihood of dilution—just like the states. Other authorities disagreed. They pointed out that while the state statutes prohibit use of trademarks where there is a “likelihood . . . of dilution,” the federal statute prohibits use that “causes dilution.”

Based on this difference in statutory language, the Fourth Circuit in Ringling Bros. v. Utah held that proof of actual harm was required to establish dilution of a famous mark.76 According to Ringling, plaintiff must prove 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.77

The Second Circuit in Nabisco v. PF Brands rejected the Fourth Circuit requirement of actual harm. Judge Leval noted that:

   the Fourth Circuit interpretation would defeat the intent of the statute, which is to provide for an injunction to prevent the harm before it occurs;

   the Fourth Circuit position would subject the senior user to uncompensable injury;

   it would be impossible to obtain declaratory relief before a junior user launched its product;

   consumer surveys used to show actual harm are “quite subject to manipulation and . . . therefore not highly reliable”; and

   circumstantial evidence can be used to justify the inference of injury in a dilution case, just as it has long been used to establish infringement.78

The Sixth and Seventh Circuits lined up with the Second Circuit Nabisco decision, holding that actual harm is not required.79 The Fifth Circuit in Westchester Media agreed with the Fourth Circuit’s Ringling decision.80

This split in the circuits was resolved by the Supreme Court in the March 2003 Victoria’s Secret decision.81

[B]       The Supreme Court Speaks:
Victor/Victoria—A Play in Three Acts

Prologue: Defendant Victor Moseley and his wife opened a lingerie and adult novelties store under the name Victor’s Secret.82 The store was located in a strip mall in Elizabethtown, Kentucky. An army officer at nearby Fort Knox received a Victor’s Secret flyer and complained to Victoria’s Secret, the nationwide lingerie retailer. The officer noted “what he perceived to be an attempt to use a reputable company’s trademark to promote the sale of unwholesome and tawdry merchandise.”83 Victoria’s Secret dispatched a letter of protest, and the Moseleys responded by changing the store name to Victor’s Little Secret. Victoria’s Secret brought suit, alleging likely confusion and dilution.

Act I: The district court denied Victoria’s Secret’s motion for summary judgment on its confusion claim. However, the court granted summary judgment on dilution, finding that Victor’s Little Secret was likely to blur and tarnish Victoria’s Secret.84

Act II: The Sixth Circuit affirmed the district court’s ruling that plaintiff had established likelihood of dilution under the FTDA.85 In doing so, the Sixth Circuit relied on the earlier Sixth Circuit Kellogg decision holding that actual harm was not required.86

Act III: The Supreme Court granted certiorari to answer the question whether “objective proof of actual injury to the economic value of a famous mark (as opposed to a presumption of harm arising from a subjective ‘likelihood of dilution’ standard) is a requisite for relief under the FTDA.”87

[C]        Supreme Court’s View of Dilution: Actual Harm Is Required

Proof of Actual Harm (Actual Dilution) Is Required A unanimous Supreme Court held that actual harm is required under the FTDA. The language “causes dilution” in 15 U.S.C. § 1125(c)(1) (contrasted with the earlier state statutes, which protect against likely dilution) requires this result.88

The Court found that “evidence in the present record is not sufficient to support the summary judgment on the dilution count” and remanded for further proceedings.89

Proof of Economic Loss Is Not Required While plaintiff must prove actual harm (actual dilution), this “does not mean that the consequences of dilution, such as an actual loss of sales or profits, must also be proved.”90 The Supreme Court disagreed with the Fourth Circuit in Ringling Bros. to the extent that Ringling suggested that consequences of dilution must be established.91

[D]        Identical Versus Nonidentical Marks:
A Distinction with a Difference

The Court acknowledged that dilution was not limited to identical marks. “Even if the legislative history might lend some support to such a contention, it surely is not compelled by the statutory text.”92

Proving Actual Harm Where Marks Are Identical: While dilution is not limited to identical marks, identity does make a difference with respect to proof. Where the junior and senior marks are identical, those circumstances alone may be proof of actual dilution:

[D]irect evidence of dilution such as consumer surveys will not be necessary if actual dilution can reliably be proven through circumstantial evidence—the obvious case is one where the junior and senior marks are identical.93

Proving Actual Harm Where Marks Are Not Identical: Where the parties’ marks are not identical, plaintiff must show some impact on its mark, for example, that defendant’s use will affect the consumer’s conception of plaintiff’s mark.94 Mental association is not enough:

[T]he mere fact that consumers mentally associate the junior user’s mark with a famous mark is not sufficient to establish actionable dilution. . . . [S]uch mental association will not necessarily reduce the capacity of the famous mark to identify the goods of its owner, the statutory requirement for dilution under the FTDA.95

The Court pointed to the Ringling Bros. case as an example. It was not enough that the Utah Tourism Board’s slogan “The Greatest Snow on Earth” triggered an association with the Ringling Bros. Circus slogan “The Greatest Show on Earth.” Plaintiff must show that consumers will associate the Ringling Bros. slogan with skiing or snow sports or will associate it less strongly or exclusively with the circus.

Applying this standard to the facts in Victoria’s Secret, the Court noted that the “army officer who saw the advertisement of the opening of a store named ‘Victor’s Secret’ did make the mental association with ‘Victoria’s Secret.’” However, “he did not therefore form any different impression of the store that his wife and daughter patronized.”96

The Court also noted that Victoria’s Secret’s marketing expert “had nothing to say about the impact of petitioner’s name (Victor’s Little Secret) on the strength of respondents’ [Victoria’s Secret] mark.”97

As to consumer surveys, the Court acknowledged the argument that surveys may be difficult to construct and subject to reliability questions. However, difficulties of proof are not a reason to do away with plaintiff’s burden of proving actual harm:

Whatever difficulties of proof may be entailed, they are not an acceptable reason for dispensing with proof of an essential element of a statutory violation.98

Thus, a party claiming dilution by a similar mark should consider surveys, testimony of marketing experts, and testimony of consumers as possible evidence of the impact of defendant’s use on the consumer’s conception of plaintiff’s mark.

[E]         What Else the Court Said

Justice Kennedy’s Concurrence: In his concurring opinion, Justice Kennedy made several points that may assist trademark owners in future dilution actions:

If a mark will erode or lessen the power of the famous mark to give customers the assurance of quality and full satisfaction they have in knowing they have purchased goods bearing the famous mark, the elements of dilution may be established.99

Diminishment of the famous mark’s capacity [to identify and distinguish plaintiff’s goods] can be shown by the probable consequences flowing from use or adoption of the competing mark.100

A holder of a famous mark . . . should not be forced to wait until the damage is done and the distinctiveness of the mark has been eroded.101

The Court’s opinion does not foreclose injunctive relief if respondents on remand present sufficient evidence of either blurring or tarnishment.102

The Court’s Comment on Tarnishment: The Supreme Court questioned in Part III of the opinion whether tarnishment “is actually embraced by the statutory text” of the FTDA. While this comment has caused some practitioners to raise their eyebrows, the Court also noted that (1) the concept of tarnishment “was prominent in litigation brought under state antidilution statutes” and (2) the legislative history described the purpose of the FTDA as “‘to protect famous trademarks from subsequent uses that blur the distinctiveness of the mark or tarnish or disparage it.’”103

§  9:3.6    Remedies

The scope of injunctive relief under the FTDA is nationwide.104 In addition, in cases of “willful” dilution, the remedies of profits, damages, attorneys’ fees, and even enhanced damages under section 35 of the Lanham Act are available to a prevailing party.

The FTDA, like the state dilution statutes, does not specify bad-faith intent as a requirement for injunctive relief. However, “willful dilution” is required for monetary awards.105

§  9:3.7    Defenses

[A]        Federal Registration Defense

The FTDA provides that ownership of a valid federal registration on the principal register shall bar an action against that mark under a state statute or common law.106

[B]        Fair Use and First Amendment Defenses Under Section 43(c)

Section 43(c)(4) provides:

The following shall not be actionable under this section:

(A)  Fair use of a famous mark by another person in comparative commercial advertising or promotion to identify the competing goods or services of the owner of the famous mark.

(B)  Noncommercial use of a mark.

(C)  All forms of news reporting and news commentary.107

The legislative history of section 43(c) indicates that Congress was concerned primarily with the effect the statute might have on the media:

The proposal adequately addresses legitimate first amendment concerns espoused by the broadcasting industry and the media. The bill will not prohibit or threaten noncommercial expression, such as parody, satire, editorial and other forms of expression that are not a part of a commercial transaction. The bill includes specific language exempting from liability the “fair use” of a mark in the context of comparative commercial advertising or promotion.108

Examples of uses found to be noncommercial under the FTDA include:

Barbie Girl” in song title and lyrics lampooning Barbie Doll image.109

Use of TaftQuack duck resembling AFLAC insurance company duck to criticize politician Robert Taft in TV political ad.110

In the Mattel case, the Ninth Circuit held that the use of the Barbie name in the lyrics and title of the song “Barbie Girl” constituted dilution under the FTDA but was a protected noncommercial use. While the Barbie name was used to sell copies of the song, the song “also lampoons the Barbie image and comments humorously on the cultural values [defendant] claims she represents.”111 Because the commercial purpose of “Barbie Girl” was “inextricably entwined with expressive elements,” defendant’s use was not purely commercial speech and was therefore fully protected by the First Amendment.112

[C]        Fair Use Under Section 33(b)(4)

In addition to the fair use provision under the FTDA, the Lanham Act already has a fair use provision. Section 33(b)(4) permits the use of another party’s trademark “which is descriptive of and used fairly and in good faith only to describe the goods or services of such party.”113

Even prior to enactment of the FTDA, courts found that a descriptive use of plaintiff’s mark does not constitute dilution.114

§  9:4      Dilution in Patent and Trademark Office Proceedings

The Lanham Act was amended on August 5, 1999, to make it clear that dilution is a ground for opposition and/or cancellation of a registration in a PTO proceeding.115 The amendment applies to applications for registration filed on or after January 16, 1996.

In the first opposition proceeding dealing with the issue of dilution, the Trademark Trial and Appeal Board (TTAB) found that opposer’s Toro mark for power landscaping tools was not diluted by applicant’s intent to use mark ToroMR for computer disk drive components. The TTAB required strict proof of a mark’s fame and noted that “unlike in likelihood of confusion cases, we will not resolve doubts in favor of the party claiming dilution.”116

The Federal Circuit Enterprise Rent-A-Car case held that there can be no opposition based on dilution where the allegedly famous mark did not achieve fame prior to any use by the accused infringer. The Enterprise Court also held that dilution under state statutes was not a ground for opposition.117

Likelihood of dilution, not actual dilution, is the standard under the Lanham Act sections governing oppositions and cancellations. As the TTAB pointed out in Nasdaq, the statutory language contemplates prospective relief.117.1

§  9:5   The Continuing Evolution of the Species

Even though the Supreme Court resolved the issue of whether dilution under the FTDA requires proof of actual harm (it does), many uncertainties remain about the scope of dilution law. For example:

   Should marks that are famous only in particular regions or in particular channels of commerce (niche marks) qualify for dilution protection?

   Are descriptive marks that have acquired distinctiveness eligible for dilution protection under the FTDA?

   Is it appropriate to determine dilution by reference to a multifactor test similar to that used in evaluating likelihood of confusion?

   Should product design trade dress be eligible for dilution protection?

   Can the FTDA be applied retroactively to enjoin a diluting use that began before the FTDA was enacted?

   What will be the impact of the Supreme Court observation that it is questionable whether tarnishment is embraced in the FTDA statutory text?

Below are some differing views on these issues.

§  9:5.1           Protection of Niche Marks

A number of decisions protect marks that are famous in a niche, for example, a particular product line. For example, the Third Circuit Times Mirror case affirmed an injunction under the FTDA where The Sporting News had been found to be famous within the sports magazine niche.118

But not all authorities believe that the FTDA should protect niche market fame. The argument is that dilution was designed for noncompetitive products; where the diluting use occurs in the same niche market, the products are competitive and the trademark infringement cause of action should be sufficient:

[T]he unauthorized use of a mark in the same or a similar market is precisely what good old-fashioned infringement principles have traditionally been there to remedy once actual confusion or likelihood of confusion has been shown, and there is simply no need for dilution principles.119

§  9:5.2           Meaning of “Distinctive and Famous”

Section 43(c) lists eight nonexhaustive factors to consider in determining whether a mark is distinctive and is famous so as to merit protection under the FTDA.

The factors are clear enough.120 But just what the statute means by “distinctive” and “famous” in this context is not so clear. Questions relating to the interpretation of this phrase include the following.

[A]        Are “Distinctive” and “Famous” Two Separate Requirements?

In Nabisco, the Second Circuit held that distinctiveness is an element of a dilution claim independent from the fame element.121 In Times Mirror, the Third Circuit expressly rejected the Nabisco view. The Third Circuit noted that a test for distinctiveness separate from the test for fame would be “inconsistent with the language and construction of the trademark statute.”122 Professor McCarthy agrees. He considers distinctiveness a synonym for fame.123

In Victoria’s Secret, the Supreme Court stated in a footnote that: “It is quite clear that the statute intends distinctiveness, in addition to fame, as a separate element.”124 However, this statement was dicta and the Court did not address the dispute surrounding the meaning of “distinctive” and “famous.”

[B]        Does the FTDA Protect Marks That Have Acquired Distinctiveness Through Secondary Meaning?

According to the Second Circuit, “distinctive” means inherent distinctiveness, that is, the mark must have been distinctive at the outset as opposed to having acquired distinctiveness through use. Writing for the court in the Nabisco case, Judge Leval concluded that a famous mark that has acquired secondary meaning is not distinctive as that term is used in the FTDA, and is not entitled to protection.125

Other courts have allowed dilution protection where a mark has acquired distinctiveness through secondary meaning.126 After all, the first of the eight “distinctive and famous” factors refers to the “degree of inherent or acquired distinctiveness of the mark.” And as Professor McCarthy points out, “distinctive” in trademark law has traditionally included distinctiveness acquired through secondary meaning.127

It should also be noted that the Second Circuit requirement of inherent distinctiveness strips federal dilution protection from a host of famous marks that were initially descriptive, for example, Coca-Cola, McDonalds and DuPont.128 DuPont shoes was given as an example of a diluting use in the legislative histories for both the FTDA and the New York statute.129

§  9:5.3    Role of Dilution Factors

Some courts analyze dilution by applying a series of factors. Judge Sweet in his concurring opinion in the Second Circuit Mead decision considered the following factors in evaluating dilution under the New York state statute: similarity of marks and products, consumer sophistication, predatory intent, and renown of the two marks.130

Several circuits have criticized the Mead factors as inappropriate for assessing a dilution claim under the FTDA. The First Circuit in the Lund case noted that the Mead factors “work directly contrary to the intent of a law whose primary purpose was to apply in cases of widely differing goods, that is, Kodak pianos and Kodak film”131 The Fourth Circuit in Ringling Bros. said that the Mead “analysis simply is not appropriate for assessing a claim under the federal Act.”132 And the Seventh Circuit observed in Eli Lilly that “several of these factors are more suited to an inquiry into the likelihood of confusion.”133

Even a later Second Circuit decision had some critical comment on the earlier Second Circuit Mead factors. In Nabisco, Judge Leval pronounced the Mead factors as too restrictive and applied a more elaborate multifactor analysis:

1.     distinctiveness;

2.     mark similarity;

3.     product proximity and likelihood of bridging the gap;

4.     interrelationship of 1–3;

5.     shared consumers and geographical limitations;

6.     consumer sophistication;

7.     actual confusion;

8.     adjectival quality of the junior use;

9.     harm to the junior user and delay by the senior user; and

10.   the senior user’s laxity in protecting the mark.134

The Third Circuit in Times Mirror advocated considering both the Mead and Nabisco factors.135

The Supreme Court in Victoria’s Secret alluded to the Nabisco factors in its discussion of the Sixth Circuit’s disposition below.136 But the appropriateness of a factor analysis or the substance of specific factors was not before the Court.

Keep posted for more input about the role of a multifactor approach in evaluating dilution.

§  9:5.4           Protection of Product Design Trade Dress

A number of decisions have applied dilution statutes to protect trade dress.137 Moreover, many forms of trade dress are, according to the Supreme Court, to be treated just like other trademarks.138 The Restatement of Unfair Competition states that the dilution statutes are “generally applicable to slogans, trade dress, and other symbols that qualify for protection as a trademark.”139 However, the Restatement goes on to note that the protection of product design from nonconfusing uses under state dilution law raises special problems because of the preemptive effect of the federal copyright and patent laws. The Restatement notes that a definitive statement of the law is not possible from existing cases.

While the FTDA is not subject to state law preemption problems, it may be argued that the Act should not grant product design protection that would conflict with patent law policy.140 However, such a conflict is usually avoided where the product design is nonfunctional. For example, the Act was applied to protect product design in the Sunbeam case. The court found the overall look and shape of the Sunbeam stand mixer nonfunctional and sufficiently distinctive to qualify as a “famous mark” subject to protection under the FTDA for purposes of granting preliminary relief.141

§  9:5.5           Dilution and Retroactivity: It’s Not Over Till the Highest Court Sings

The FTDA became effective on January 16, 1996. Like other civil statutes, it does not operate retroactively absent a clear Congressional statement that it should. The question is: What is a retroactive operation? There is no disagreement that the recovery of damages for pre-statute conduct would have impermissible retroactive effect. There is disagreement, however, as to whether an injunction against continued use of a mark can constitute impermissible retroactive effect where the mark has been adopted before enactment of the statute.

A number of cases have concluded that the statute could not be applied in a case stemming from pre-enactment events and conduct.142 The Circuit City decision (followed by several other district court decisions) reasoned that an injunction barring future use would deprive defendant of his commercial investment, which was lawful at the time.

The Circuit City court acknowledged the Supreme Court statement in Landgraf that when the intervening statute authorizes prospective relief, its application is not retroactive.143 But, according to Circuit City, this was dicta that spoke solely to cases where the relevant conduct was already illegal before enactment of the statute. In that situation, the statute merely provides a new remedy.

Circuit City was first challenged by the Fuente Cigar case. Fuente faulted Circuit City for its concern over the protection of commercial expectation.144 Fuente points to the Landgraf statement that “a statute does not operate ‘retroactively’ merely because it . . . upsets expectations based on prior law.”145

The Fuente reasoning was adopted by the Eighth Circuit in the Viacom case, reversing the district court’s refusal to apply the federal dilution statute to enjoin a mark adopted before the statute’s enactment. The Eighth Circuit noted that if defendant’s pre-statute investment were a problem, it could be taken into account under the statutory provision that required injunctions to be granted under principles of equity.146

It looks like the more recent cases are following Viacom, but we have yet to hear the highest Court sing.147

§  9:5.6           Role of Tarnishment

In Victoria’s Secret, the Supreme Court noted that while the concept of tarnishment “was prominent in litigation brought under state antidilution statutes” and while tarnishment was mentioned in the FTDA legislative history, “[w]hether it is actually embraced by the statutory text, however, is a different matter.” The Court stated:

Indeed, the contrast between the state statutes, which expressly refer to both “injury to business reputation” and to “dilution of the distinctive quality of a trade name or trademark,” and the federal statute which refers only to the latter, arguably supports a narrower reading of the FTDA.148

It remains to be seen to what extent the Court’s comments will be picked up by lower courts. However, anyone arguing that the FTDA does not cover dilution based on tarnishment will have to confront the legislative history. As noted in Victoria’s Secret, Congress specifically stated that the purpose of the FTDA was “to protect famous trademarks from subsequent uses that blur the distinctiveness of the mark or tarnish or disparage it.”149

 

 

1.       See Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 773, reh’g denied, 505 U.S. 1244 (1992).

2.       See Moseley v. V Secret Catalogue, Inc., 123 S. Ct. 1115, 1122–23 (2003) (“Victoria’s Secret”). See appendix 21, illustration 46.

3.       Allied Maint. Corp. v. Allied Mech. Trades, Inc., 42 N.Y.2d 538, 544, 369 N.E.2d 1162, 399 N.Y.S.2d 628 (1977).

4.       Mass. Gen. Laws ch. 110B, § 12 (2003).

5.       See section 9:2.2 infra for the text of a typical state dilution statute.

6.       See sections 9:2.2 and 9:2.3, infra.

7.       H.R. Rep. No. 374, 104th Cong., 1st Sess. pt. 2 (“purpose and summary”) (1995).

8.       See, e.g., Hasbro, Inc. v. Clue Computing, Inc., 232 F.3d 1 (1st Cir. 2000) (Clue for board game not diluted by “clue.com” domain name for Clue Computing’s computer consulting website; mark is not famous because it “is a common word that numerous third parties use”).

9.       Moseley v. V Secret Catalogue, 535 U.S. 985 (2002).

10.       Victoria’s Secret, 123 S. Ct. at 1124–25 (citing Ringling Bros.-Barnum & Bailey Combined Shows, Inc. v. Utah Div. of Travel Dev., 170 F.3d 449, 460–65 (4th Cir. 1999)).

11.       Victoria’s Secret, 123 S. Ct. at 1124.

12.       Mortellito v. Nina of Cal., Inc., 335 F. Supp. 1288, 1296 (S.D.N.Y. 1972).

13.       Ameritech, Inc. v. Am. Info. Techs. Corp., 811 F.2d 960, 965 (6th Cir. 1987), cited in Victoria’s Secret, 123 S. Ct. 1115, 1120. See also 3 R. Callmann, The Law of Unfair Competition, Trademarks, and Monopolies § 84.2, at 954–55 (2d ed. 1969).

14.       N.Y. Gen. Bus. Law § 360-l (2003).

15.       Berlitz Schs. of Languages of Am., Inc. v. Everest House, 619 F.2d 211, 215 (2d Cir. 1980); HMH Publ’g Co. v. Lambert, 482 F.2d 595, 599 (9th Cir. 1973); Carter-Wallace, Inc. v. Procter & Gamble Co., 434 F.2d 794, 803 (9th Cir. 1970).

16.       Coca-Cola Co. v. Gemini Rising, Inc., 346 F. Supp. 1183 (S.D.N.Y. 1972).

17.       Girl Scouts of United States v. Personality Posters Mfg. Co., 304 F. Supp. 1228 (S.D.N.Y. 1969).

18.       Tetley, Inc. v. Topps Chewing Gum, Inc., 556 F. Supp. 785 (E.D.N.Y. 1983).

19.       Pillsbury Co. v. Milky Way Prods., Inc., 215 U.S.P.Q. 124 (N.D. Ga. 1981).

20.       Sally Gee, Inc. v. Myra Hogan, Inc., 699 F.2d 621, 624 (2d Cir. 1983).

21.       Dallas Cowboys Cheerleaders, Inc. v. Pussycat Cinema, Ltd., 604 F.2d 200, 205 n.8 (2d Cir. 1979); Mushroom Makers, Inc. v. R.G. Barry Corp., 580 F.2d 44, 49 (2d Cir. 1978), cert. denied, 439 U.S. 1116 (1979).

22.       Sally Gee, Inc. v. Myra Hogan, Inc., 699 F.2d 621, 625 (2d Cir. 1983).

23.       See appendix 20 for list of states organized by type of dilution statute.

24.       Note, Dilution: Trademark Infringement or Will-o’-Wisp? 77 Harv. L. Rev. 520, 530 (1964). These examples of famous diluting marks were given in the legislative history of the New York statute: DuPont shoes, Buick aspirin tablets, Schlitz varnish, Kodak pianos, and Bulova gowns. 1954 N.Y. Legis. Ann. 49.

25.       Restatement (Third) of Unfair Competition § 25 cmt. c at 267 (1995).

26.       Allied Maint. Corp. v. Allied Mech. Trades, Inc., 42 N.Y.2d 538, 545– 46, 369 N.E.2d 1162 (1977) (over 300 uses of Allied for companies in the New York telephone directory precluded a finding of distinctiveness).

27.       Original Appalachian Artworks, Inc. v. Topps Chewing Gum, Inc., 642 F. Supp. 1031 (N.D. Ga. 1986).

28.       Am. Express Co. v. Vibra Approved Labs. Corp., 10 U.S.P.Q.2d 2006 (S.D.N.Y. 1989).

29.       Coca-Cola Co. v. Alma-Leo U.S.A., Inc., 719 F. Supp. 725 (N.D. Ill. 1989) (dilution of Coca-Cola bottle under Illinois statute).

30.       Deere & Co. v. MTD Prods., Inc., 41 F.3d 39 (2d Cir. 1994).

31.       Estee Lauder, Inc. v. Cinnabar 2000 Haircutters, Inc., 218 U.S.P.Q. 191 (S.D.N.Y.), aff’d mem., 714 F.2d 112 (2d Cir. 1982).

32.       Cmty. Fed. Sav. & Loan Ass’n v. Orondorff, 678 F.2d 1034 (11th Cir. 1982).

33.       Wedgwood Homes, Inc., v. Lund, 221 U.S.P.Q. 174 (Or. Ct. App. 1982), aff’d, 659 P.2d 377 (Or. 1983) (protection for Wedgwood on real estate granted because of reputation in local Portland metropolitan area, despite argument that Wedgwood was associated with the well-known china on the national level).

34.       Am. United Life Ins. Co. v. Am. United Ins. Co., 731 F. Supp. 480 (S.D. Fla. 1990).

35.       Exxon Corp. v. Oxxford Clothes, Inc., 109 F.3d 1070, 1081 (5th Cir.), cert. denied, 522 U.S. 915 (1997).

36.       Sally Gee, Inc. v. Myra Hogan, Inc., 699 F.2d 621, 624–25 (2d Cir. 1983).

37.       Id. at 626.

38.       Mead Data Ctr., Inc. v. Toyota Motor Sales, Inc., 875 F.2d 1026 (2d Cir. 1989).

39.       Polaroid Corp. v. Polaraid, Inc., 319 F.2d 830, 836 (7th Cir. 1963). See also Hyatt Corp. v. Hyatt Legal Servs., 736 F.2d 1153 (7th Cir. 1984) (court found a likelihood of success on plaintiff’s claim that Hyatt for legal services blurred Hyatt for hotels).

40.       Hormel Foods Corp. v. Jim Henson Prods., Inc., 73 F.3d 497, 506 (2d Cir. 1996) (applying New York state statute).

41.       See discussion of First Amendment as a defense to dilution under the federal Act at section 9:3.7[C] infra. See also, infra, section 12:1.3, “Parody.”

42.       Deere & Co. v. MTD Prods., Inc., 41 F.3d 39, 43 (2d Cir. 1994).

43.       Hormel Foods Corp. v. Jim Henson Prods., Inc., 73 F.3d 497 (2d Cir. 1996).

44.       Steinway & Sons v. Robert Demars & Friends, 210 U.S.P.Q. 954, 961 (C.D. Cal. 1981).

45.       Pillsbury Co. v. Milky Way Prods., Inc., 215 U.S.P.Q. 124 (N.D. Ga. 1981); see also Hasbro, Inc. v. Internet Entm’t Group Ltd., 40 U.S.P.Q.2d 1479 (W.D. Wash. 1996) (Candyland children’s game tarnished by “candyland.com” for website showing sexually explicit pictures); Polo Ralph Lauren L.P. v. Schuman, 46 U.S.P.Q.2d 1046 (S.D. Tex. 1998) (Ralph Lauren mark Polo tarnished by Polo for adult entertainment business).

46.       L.L. Bean, Inc. v. Drake Publishers, Inc., 811 F.2d 26, 33 (1st Cir.) (application of Maine state dilution statute to enjoin noncommercial parody found unconstitutional), cert. denied, 483 U.S. 1013 (1987).

47.       811 F.2d at 32. Cf. Mut. of Omaha Ins. Co. v. Novak, 836 F.2d 397, 403 n.9 (8th Cir. 1987) (distinguishing noncommercial use in L.L.Bean from defendant Novak’s commercial use of Mutant of Omaha on T‑shirts, caps, buttons and mugs protesting nuclear arms; court found likelihood of confusion with plaintiff’s mark Mutual of Omaha).

48.       Sally Gee, Inc. v. Myra Hogan, Inc., 699 F.2d 621, 626 (2d Cir. 1983).

49.       N.Y. Gen. Bus. Law § 360-l (2003).

50.       Deere & Co. v. MTD Prods., Inc., 41 F.3d 39, 46–47 (2d Cir. 1994).

51.       Hyatt Corp. v. Hyatt Legal Servs., 736 F.2d 1153, 1158 (7th Cir. 1984) (remanding case to district court and suggesting issuance of nationwide injunction). On remand, although the district court “found the strong possibility of a constitutional infirmity in a nationwide injunction,” it issued such an injunction at the Seventh Circuit’s request. Hyatt Corp. v. Hyatt Legal Servs., 610 F. Supp. 381, 382, 385–86 (N.D. Ill. 1985).

52.       Restatement (Third) of Unfair Competition § 36 cmt. a at 378 (1995).

53.       See H.R. Rep. No. 100-1028, 100th Cong., 2d Sess. (1988).

54.       15 U.S.C. § 1125(c)(4).

55.       Moseley v. V Secret Catalogue, Inc., 123 S. Ct. 1115 (2003). See infra section 9:3.5.

56.       15 U.S.C. § 1125(c).

57.       H.R. Rep. No. 104-374, at 3 (1995).

58.       15 U.S.C. § 1127.

59.       15 U.S.C. § 1125(c)(1).

60.       See 15 U.S.C. § 1125(c); Pinehurst, Inc. v. Wick, 256 F. Supp. 2d 424 (M.D.N.C. 2003). See also Westchester Media v. PRL USA Holdings, Inc., 214 F.3d 658, 670 (5th Cir. 2000); Times Mirror Magazines, Inc. v. Las Vegas Sports News, L.L.C., 212 F.3d 157, 163 (3d Cir. 2000), cert. denied, 531 U.S. 1071 (2001).

61.       See supra section 9:2.3[A] for examples of marks protected under pre-FTDA state statutes.

62.       15 U.S.C. § 1125(c)(1).

63.       See infra section 9:5 for differing views on this and other issues re the scope of dilution protection.

64.       Times Mirror Magazines, Inc. v. Las Vegas Sports News, L.L.C., 212 F.3d 157 (3d Cir. 2000), cert. denied, 531 U.S. 1071 (2001).

65.       Wawa, Inc. v. Haaf, 40 U.S.P.Q.2d 1629 (E.D. Pa. 1996), aff’d mem., 116 F.3d 471 (3d Cir. 1997).

66.       Hasbro, Inc. v. Internet Entm’t Group Ltd., 40 U.S.P.Q.2d 1479 (N.D. Wash. 1996).

67.       Binney & Smith v. Rose Art Indus., 60 U.S.P.Q.2d 2000 (E.D. Pa. 2001) (preliminary injunction granted).

68.       Columbia Univ. v. Columbia/HCA Healthcare Corp., 964 F. Supp. 733, 749–50 (S.D.N.Y. 1997).

69.       Petro Shopping Ctrs., L.P. v. James River Petroleum, 41 U.S.P.Q.2d 1853 (E.D. Va. 1997), aff’d, 130 F.3d 88 (4th Cir. 1997), cert. denied, 523 U.S. 1095 (1998).

70.       Star Mkts., Ltd. v. Texaco, Inc., 950 F. Supp. 1030 (D. Haw. 1996).

71.       See AM Gen. Corp. v. Daimlerchrysler Corp., 311 F.3d 796 (7th Cir. 2002) (denial of preliminary injunction affirmed where Daimlerchrysler failed to show its Jeep grille had become famous before Hummer adopted its grille design, as required by dilution statute).

72.       Enter. Rent-A-Car Co. v. Advantage Rent-A-Car, Inc., 330 F.3d 1333 (Fed. Cir. 2003).

73.       15 U.S.C. § 1125(c)(1).

74.       H.R. Rep. No. 104-374 (Nov. 30, 1995).

75.       See, e.g., Thane Int’l, Inc. v. Trek Bicycle Corp., 305 F.3d 894, 905 (9th Cir. 2002) (blurring and tarnishment are the two most common forms of dilution); Eli Lilly & Co. v. Natural Answers, Inc., 233 F.3d 456, 466 (7th Cir. 2000) (two principal forms of dilution are tarnishing and blurring). But note the Supreme Court’s comment in Victoria’s Secret that the FTDA language arguably does not embrace tarnishment. See infra sections 9:3.5[E] and 9:5.6.

76.       Ringling Bros.-Barnum & Bailey Combined Shows, Inc. v. Utah Div. of Travel Dev., 170 F.3d 449 (4th Cir. 1999), cert. denied, 528 U.S. 923 (1999).

77.       Id. at 461.

78.       Nabisco, Inc. v. PF Brands, Inc., 191 F.3d 208, 224 (2d Cir. 1999).

79.       Kellogg Co. v. Exxon Corp., 209 F.3d 562 (6th Cir. 2000); Eli Lilly & Co. v. Natural Answers, Inc., 233 F.3d 456 (7th Cir. 2000).

80.       Westchester Media v. PRL USA Holdings, Inc., 214 F.3d 658 (5th Cir. 2000).

81.       Moseley v. V Secret Catalogue, Inc., 123 S. Ct. 1115 (2003).

82.       Id.

83.       Id.

84.       V Secret Catalogue, Inc. v. Moseley, 2000 U.S. Dist. LEXIS 5215 at *15 (W.D. Ky. Feb. 9, 2000).

85.       259 F.3d 464, 477 (6th Cir. 2001).

86.       Id. citing Kellogg Co. v. Exxon Corp., 209 F.3d 562 (6th Cir. 2000). Kellogg adopted standards for determining dilution under the FTDA that were enunciated by the Second Circuit in Nabisco, Inc. v. PF Brands, Inc., 191 F.3d 208 (2d Cir. 1998).

87.       Moseley v. V Secret Catalogue, 535 U.S. 985 (2002).

88.       Moseley v. V Secret Catalogue, Inc., 123 S. Ct. 1115, 1124 (2003).

89.       Id. at 1125.

90.       Id. at 1124.

91.       Id.

92.       Id.

93.       Id. at 1125.

94.       Id. at 1124–25.

95.       Id. at 1124.

96.       Id. at 1125.

97.       Id.

98.       Id.

99.       Id. at 1125–26.

100.      Id. at 1126.

101.      Id.

102.      Id.

103.      123 S. Ct. at 1125, citing H.R. Rep. No. 104-374, at 1029 (1995). Justice Scalia did not join this section of the opinion (Part III). See infra section 9:5.6 for further discussion of the role of tarnishment in dilution law.

104.      15 U.S.C. § 1125(c). Query whether a disclaimer may be an effective remedy to a dilution claim. See Liquid Glass Enter. v. Dr. Ing. h.c.F. Porsche AG, 8 F. Supp. 2d 398, 405 n.5 (D.N.J. 1998) (stating that disclaimer will never remedy dilution because consumer confusion is irrelevant in establishing a dilution claim; use of Porsche mark and trade dress in advertising for defendant’s car polish preliminarily enjoined).

105.      15 U.S.C. § 1125(c)(3).

106.      Id.

107.      15 U.S.C. § 1125(c)(4).

108.      141 Cong. Rec. 19,310 (1995).

109.      Mattel, Inc. v. MCA Records, Inc., 296 F.3d 894 (9th Cir. 2002), cert. denied, 123 S. Ct. 993 (2003).

110.      Am. Family Life Ins. Co. v. Hagan, 64 U.S.P.Q.2d 1865 (N.D. Ohio 2002) (no dilution of AFLAC insurance company quacking duck).

111.      Mattel, 296 F.3d at 907.

112.      Id. at 906. See infra section 12:1.3[E], “The First Amendment Trump Card.”

113.      15 U.S.C. § 1115(b)(4). See infra section 12:2.4, “Fair Use.”

114.      Sunmark, Inc. v. Ocean Spray Cranberries, Inc., 64 F.3d 1055, 1060–61 (7th Cir. 1995); Munters Corp. v. Matsui Am., Inc., 730 F. Supp. 790, 802 (N.D. Ill. 1989), aff’d, 909 F.2d 250 (7th Cir. 1990); Restatement (Third) of Unfair Competition § 25 cmt. i at 272 (1995).

115.      Trademark Amendments Act of 1999, Pub. L. No. 106-43, 113 Stat. 218 (1999).

116.      Toro Co. v. ToroHead, Inc., 61 U.S.P.Q.2d 1164, 1174 (T.T.A.B. 2001).

117.      Enter. Rent-A-Car Co. v. Advantage Rent-A-Car, Inc., 330 F.3d 1333 (Fed. Cir. 2003).

117.1.   Nasdaq Stock Mkt., Inc. v. Antarctica S.r.l., No. 91121204 (T.T.A.B. June 30, 2003) (noting both that 15 U.S.C. § 1052(f) permits Board proceedings to be based on claim that newcomer’s mark “when used would cause dilution” and also that 15 U.S.C. §§ 1063 and 1064 recite owner’s belief that he “would be” or “will be” damaged by dilution).

118.      Times Mirror Magazines, Inc. v. Las Vegas Sports News, L.L.C., 212 F.3d 157 (3d Cir. 2000), cert. denied, 531 U.S. 1071 (2001); Advantage Rent-A-Car, Inc. v. Enter. Rent-A-Car Co., 238 F.3d 378, 381 (5th Cir. 2001) (“We’ll Pick You Up” sufficiently famous within the car rental industry); Syndicate Sales, Inc. v. Hampshire Paper Corp., 192 F.3d 633 (7th Cir. 1999) (floral basket design fame sufficient in wholesale and retail florists market).

119.      4 J. Thomas McCarthy, McCarthy on Trademarks & Unfair Competition § 24:112.1 at p. 24-246 (4th ed. 2003) quoting dissent in Times Mirror, 212 F.3d at 174.

120.      See supra section 9:3.4[A], “The ‘Famous’ Mark Requirement.”

121.      Nabisco, Inc. v. PF Brands, Inc., 191 F.3d 208, 216 (2d Cir. 1999) (goldfish-shaped snack food diluted by similar shape used as part of snack food mix).

122.      Times Mirror Magazines, Inc. v. Las Vegas Sports News, L.L.C., 212 F.3d 157, 166–67 (3d Cir. 2000), cert. denied, 531 U.S. 1071 (2001).

123.      4 J. Thomas McCarthy, McCarthy on Trademarks & Unfair Competition § 24:91–24:91.1 (4th ed. 2003).

124.      Moseley v. V Secret Catalogue, Inc., 123 S. Ct. 1115, 1121, n.5 (2003).

125.      Nabisco, 191 F.3d at 215–16; see also TCPIP Holding Co. v. Haar Communications, Inc., 244 F.3d 88, 95 (2d Cir. 2001) (Leval, J.) (a mark must possess a sufficient degree of inherent distinctiveness to be protectable under the FTDA). The Second Circuit followed TCPIP in N.Y. Stock Exch., Inc. v. N.Y., N.Y. Hotel, LLC, 293 F.3d 550, 557–58 (2d Cir. 2002) (affirming summary judgment of no dilution under the FTDA as to plaintiff’s marks with acquired distinctiveness; remanding for determination of whether mark consisting of New York Stock Exchange name combined with architecture façade of the exchange was inherently distinctive).

126.      Times Mirror Magazines, 212 F.3d at 166.

127.      2 J. Thomas McCarthy, McCarthy on Trademarks & Unfair Competition § 11:2 (4th ed. 2003) (citing Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 769 (1992)). See also Wal-Mart Stores, Inc. v. Samara Bros., Inc., 529 U.S. 205, 210–11 (2000).

128.      Surnames such as McDonalds and DuPont cannot be protected unless they have acquired distinctiveness. 15 U.S.C. § 1052(e)(3). See supra section 2:3.1, “Personal Names.”

129.      H.R. Rep. No. 104-374, at 1030 (1995); 1954 N.Y. Legis. Ann. 49.

130.      Mead Data Ctr., Inc. v. Toyota Motor Sales, Inc., 875 F.2d 1026, 1035 (2d Cir. 1989); see also Times Mirror Magazines, Inc. v. Las Vegas Sports News, L.L.C., 212 F.3d 157, 168–69 (3d Cir. 2000), cert. denied, 531 U.S. 1071 (2001) (approving use of Judge Sweet’s Mead factors).

131.      I.P. Lund Trading ApS v. Kohler Co., 163 F.3d 27, 49 (1st Cir. 1998).

132.      Ringling Bros.-Barnum & Bailey Combined Shows, Inc. v. Utah Div. of Travel Dev., 170 F.3d 449, 464 (4th Cir. 1999) (“inferring actual harm and effective causation from such factors as ‘consumer sophistication,’ and ‘predatory intent’ is a chancy process at best”).

133.      Eli Lilly & Co. v. Natural Answers, Inc., 233 F.3d 456, 469 (7th Cir. 2000) (court considered only similarity of marks and renown of plaintiff’s mark).

134.      Nabisco, Inc. v. PF Brands, Inc., 191 F.3d 208, 217–22 (2d Cir. 1999).

135.      Times Mirror Magazines, Inc. v. Las Vegas Sports News, L.L.C., 212 F.3d 157, 169 (3d Cir. 2001).

136.      Moseley v. V Secret Catalogue, Inc., 123 S. Ct. 1115, 1121 n.8 (2003).

137.      See, e.g., Nabisco, 191 F.3d 208 (2d Cir. 1999) (goldfish-shaped cracker); Coca-Cola Co. v. Alma-Leo U.S.A., Inc., 719 F. Supp. 725 (N.D. Ill. 1989) (Coca-Cola bottle shape); Binney & Smith v. Rose Art Indus., 60 U.S.P.Q.2d 2000 (E.D. Pa. 2001) (yellow and green color scheme for crayons, markers, etc.).

138.      Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 770 (1992).

139.      Restatement (Third) of Unfair Competition § 25 cmt. d at 268.

140.      See I.P. Lund Trading ApS v. Kohler Co., 163 F.3d 27 (1st Cir. 1998) (constitutional issue of whether dilution statute can be applied to enjoin a competitor’s product design trade dress discussed but not decided as moot).

141.      Sunbeam Prods., Inc. v. W. Bend Co., 39 U.S.P.Q.2d 1545 (D.C. Miss. 1996), aff’d, 123 F.3d 246, 259–60 (5th Cir. 1997) (Sunbeam’s seventeen years’ use of trade dress for its stand mixer design sufficient to show likelihood of success on the merits), cert. denied, 523 U.S. 1118 (1998).

142.      Circuit City Stores, Inc. v. OfficeMax, Inc., 949 F. Supp. 409 (E.D. Va. 1996); Resorts of Pinehurst, Inc. v. Pinehurst Nat’l Corp., 973 F. Supp. 552 (M.D.N.C. 1997), aff’d in part, rev’d in part and remanded, 148 F.3d 417 (4th Cir. 1998); Nike, Inc. v. Nike Sec. L.P., 50 U.S.P.Q.2d 1202 (N.D. Ill. 1999).

143.      Landgraf v. USI Film Prods., 511 U.S. 244, 272 (1994).

144.      Fuente Cigar, Ltd. v. Opus One, 985 F. Supp. 1448 (M.D. Fla. 1997).

145.      Landgraf v. USI Film Prods., 511 U.S. 244, 270 n.24 (1994).

146.      Viacom, Inc. v. Ingram Enters., Inc., 141 F.3d 886 (8th Cir. 1998).

147.      Westchester Media v. PRL USA Holdings, Inc., 214 F.3d 658, 669 n.11 (5th Cir. 2000); see also Kellogg Co. v. Exxon Mobil Corp., 192 F. Supp. 2d 790 (W.D. Tenn. 2001); Santa’s Best v. Seattle Coffee Co., 58 U.S.P.Q.2d 1855 (N.D. Ill. 2001).

148.      Moseley v. V Secret Catalogue, Inc., 123 S. Ct. 1115, 1124 (2003).

149.      Id. at 1123 (citing H.R. Rep. No. 104-374, at 1029 (1995)).