HOME

TheInfoList



OR:

Trademark dilution is a
trademark A trademark (also written trade mark or trade-mark) is a type of intellectual property consisting of a recognizable sign, design, or expression that identifies products or services from a particular source and distinguishes them from ot ...
law concept giving the owner of a famous trademark
standing Standing, also referred to as orthostasis, is a position in which the body is held in an ''erect'' ("orthostatic") position and supported only by the feet. Although seemingly static, the body rocks slightly back and forth from the ankle in the s ...
to forbid others from using that mark in a way that would lessen its uniqueness. In most cases, trademark dilution involves an unauthorized use of another's trademark on products that do not compete with, and have little connection with, those of the trademark owner. For example, a famous trademark used by one company to refer to hair care products might be ''diluted'' if another company began using a similar mark to refer to
breakfast cereal Cereal, formally termed breakfast cereal (and further categorized as cold cereal or warm cereal), is a traditional breakfast food made from processed cereal grains. It is traditionally eaten as part of breakfast, or a snack food, primarily in We ...
s or
spark plug A spark plug (sometimes, in British English, a sparking plug, and, colloquially, a plug) is a device for delivering electric current from an ignition system to the combustion chamber of a spark-ignition engine to ignite the compressed fuel/ai ...
s. Dilution is a basis of trademark infringement that applies only to famous marks. With a non-famous mark, the owner of the mark must show that the allegedly infringing use creates a likelihood of confusion as to the source of the product or service being identified by the allegedly infringing use: it is highly unlikely a likelihood of confusion will be found if the products or services are in unrelated markets. With a famous mark, any other use has the potential for confusion, since consumers may assume affiliation with the owner of the mark regardless of the product or service.


Background

Trademark law traditionally concerned itself with situations where an unauthorized party sold goods that are directly competitive with or at least related to those sold by the trademark owner. A trademark is diluted when the use of similar or identical trademarks in other non-competing markets means that the trademark in and of itself will lose its capacity to signify a single source. In other words, unlike ordinary trademark law, dilution protection extends to trademark uses that do not confuse consumers regarding who has made a product. Instead, dilution protection law aims to protect sufficiently strong trademarks from losing their singular association in the public mind with a particular product, perhaps imagined if the trademark were to be encountered independently of any product (e.g., just the word
Pepsi Pepsi is a carbonated soft drink manufactured by PepsiCo. Originally created and developed in 1893 by Caleb Bradham and introduced as Brad's Drink, it was renamed as Pepsi-Cola in 1898, and then shortened to Pepsi in 1961. History Pepsi wa ...
spoken, or on a
billboard A billboard (also called a hoarding in the UK and many other parts of the world) is a large outdoor advertising structure (a billing board), typically found in high-traffic areas such as alongside busy roads. Billboards present large adverti ...
).


Requirements for protection

The strength required for a trademark to deserve dilution protection differs among jurisdictions, though it generally includes the requirement that it must be distinctive, famous, or even unique. Such trademarks would include instantly recognizable brand names, such as
Coca-Cola Coca-Cola, or Coke, is a carbonated soft drink manufactured by the Coca-Cola Company. Originally marketed as a temperance bar, temperance drink and intended as a patent medicine, it was invented in the late 19th century by John Stith Pembe ...
,
Kleenex Kleenex is a brand name for a variety of paper-based products such as facial tissue, bathroom tissue, paper towels, tampons, and diapers. Often used informally as a genericized trademark for facial tissue in the United States and Canada, the ...
,
Kool-Aid Kool-Aid is an American brand of flavored drink mix owned by Kraft Heinz based in Chicago, Illinois. The powder form was created by Edwin Perkins in 1927 based upon a liquid concentrate called Fruit Smack. History Kool-Aid was invented by ...
, or
Sony , commonly stylized as SONY, is a Japanese multinational conglomerate corporation headquartered in Minato, Tokyo, Japan. As a major technology company, it operates as one of the world's largest manufacturers of consumer and professional ...
, and unique terms that were invented (such as
Exxon ExxonMobil Corporation (commonly shortened to Exxon) is an American multinational oil and gas corporation headquartered in Irving, Texas. It is the largest direct descendant of John D. Rockefeller's Standard Oil, and was formed on November 3 ...
) rather than surnames (such as Ford or Zamboni) or ordinary words in language. Some
jurisdiction Jurisdiction (from Latin 'law' + 'declaration') is the legal term for the legal authority granted to a legal entity to enact justice. In federations like the United States, areas of jurisdiction apply to local, state, and federal levels. J ...
s require additional registration of these trademarks as defensive marks in order to qualify for dilution protection. Another way of describing the necessary strength of a trademark may establish some basis for dilution protection from a consumer-confusion standpoint. Truly famous trademarks are likely to be seen in many different contexts due to branching out or simple sponsorship, to the extent that there may be very few markets, if any, that a consumer would be surprised to see that famous trademark involved in. A prime example may be the past involvement of Coca-Cola in clothing lines. One further use of the protection of trademark dilution is for controversial images, including the
Cleveland Guardians The Cleveland Guardians are an American professional baseball team based in Cleveland. The Guardians compete in Major League Baseball (MLB) as a member club of the American League (AL) Central division. Since , they have played at Progressive ...
' former mascot and logo,
Chief Wahoo Chief Wahoo is a logo that was used by the Cleveland Indians, a Major League Baseball (MLB) franchise based in Cleveland, Ohio, from 1951 to 2018. As part of the larger Native American mascot controversy, the logo drew criticism from Native ...
, while the team was known as the Cleveland Indians at the time along with the
Washington Commanders The Washington Commanders are a professional American football team based in the Washington metropolitan area. The Commanders compete in the National Football League (NFL) as a member club of the league's National Football Conference (NFC) E ...
, formerly known as the Redskins. In those cases, a limited selection of merchandise is distributed solely in their physical team stores of their former controversial Native American logos, both to maintain the trademarks and prevent others from usurping them, and to null the further use of those logos in public.


Blurring and tarnishment

Dilution is sometimes divided into two related concepts: blurring, or essentially basic dilution, which "blurs" a mark from association with only one product to signify other products in other markets (such as "Kodak shoes"); and tarnishment, which is the weakening of a mark through unsavory or unflattering associations. Not all dilution protection laws recognize tarnishment as an included concept.


Laws by country


Canada

In Canada, the legal basis can be found in s. 22 of the ''
Trade-marks Act Canadian trademark law provides protection to marks by statute under the ''Trademarks Act'' and also at common law. Trademark law provides protection for distinctive marks, certification marks, distinguishing guises, and proposed marks against tho ...
'': It is commonly acknowledged that goodwill is constituted by the reputation of a trade mark and its persuasive effect.


Application of Section 22 by Canadian Courts

In the ''Clairol'' case,
Clairol International Corp. v. Thomas Supply & Equipment Co. Ltd.
', (1968) 55 C.P.R. 176,
968 Year 968 ( CMLXVIII) was a leap year starting on Wednesday (link will display the full calendar) of the Julian calendar. Events By place Byzantine Empire * Emperor Nikephoros II receives a Bulgarian embassy led by Prince Boris ( ...
2 Ex. C.R. 552
the court stated that goodwill can be depreciated through "reduction of the esteem in which the mark itself is held or through the direct persuasion and enticing of customers who could otherwise be expected to buy or continue to buy goods bearing the trade mark". The court added that the test of confusion is irrelevant here and that the "test is the likelihood of depreciating the value of the goodwill attaching to the trade mark" and that this result could be obtained without actual deception/confusion. S. 22 thus steps where confusion fails to tread. Even if there is no actual risk that the consumer might be confused between the two products, the trade mark owner will still be able to prevent another person from using his/her trade mark if that use is likely to depreciate the value of the trade mark. In the ''Veuve Clicquot'' case, the trade mark of the famous French champagne was used by a small chain of women's clothing store that was trading in eastern Quebec and Ottawa. According to the court, s. 22 applies even where a defendant's wares or services do not compete with the plaintiff's and their mark are not identical. The marks were not identical ("Cliquot" and "Veuve clicquot") and the risk of confusing the champagne brand and a clothing store was low. However the court ruled that the only element needed was the ability of an average consumer to recognize the first distinctive character. Even if the trade mark is not that well known, the fact that a significant goodwill is attached to it might be enough for the court to find the use by another person unlawful. However, in that particular case, the court claimed that the plaintiff
Veuve Clicquot Veuve Clicquot Ponsardin () is a Champagne house founded in 1772 and based in Reims. It is one of the largest Champagne houses. Madame Clicquot is credited with major breakthroughs, creating the first known vintage champagne in 1810, and i ...
failed to prove that the linkage between champagne and clothing was likely to cause depreciation. In the ''Perrier'' case, the plaintiff, a French company, was the bottler and distributor of spring water. It sought an injunction to restrain another company base in Ontario from advertising and distributing bottled water in association with the name "Pierre eh!" claiming that the value of the goodwill attached to the French trade mark would likely be depreciated. The plaintiff succeeded on section 22 to stop the use of "Pierre Eh!" on bottled water.


Proving depreciation of goodwill

The plaintiff has to prove the elements of section 22, particularly that the use would likely depreciate the value of the goodwill of the claimant's mark. A precision has been made by Vaver, that the fact "that the use could well cause depreciation is not enough. The use must actually have caused depreciation".


Limits to the use of Section 22

The use of Section 22 was restricted in the Clairol case to the use "in the technical trade-mark sense". For example, unions are allowed to use the trade mark to caricature because caricature or criticism is not a trade mark infringement, nor event a use of the trade mark, if it occurs outside "the normal course of trade". (see also The Michelin v CAW case. In that case, the court rejected the trade mark infringement argument because no one was planning on using the trade mark to sell a product).


United States

Prior to specifically targeted laws being adopted, dilution protection was used in some U.S. jurisdictions to attack domain name infringement of trademarks (see
Cybersquatting Cybersquatting (also known as domain squatting) is the practice of registering, trafficking in, or using an Internet domain name, with a bad faith intent to profit from the goodwill of a trademark belonging to someone else. The term is derived ...
). For example, in the 1998 case of ''Panavision International v. Toeppen'', defendant Dennis Toeppen registered the domain name www.panavision.com, and posted aerial views of the city of Pana, Illinois on the site. The
Ninth Circuit Court of Appeals The United States Court of Appeals for the Ninth Circuit (in case citations, 9th Cir.) is the U.S. federal court of appeals that has appellate jurisdiction over the U.S. district courts in the following federal judicial districts: * District ...
found that trademark dilution occurred when potential customers of
Panavision Panavision is an American motion picture equipment company founded in 1953 specializing in cameras and lenses, based in Woodland Hills, California. Formed by Robert Gottschalk as a small partnership to create anamorphic projection lenses dur ...
could not find its web site at panavision.com, and instead were forced to search through other (less obvious) domain names. The fact that potential customers might be discouraged from locating Panavision's legitimate website, coupled with evidence that Toeppen was in the business of registering domain names for profit, led the court to find that Toeppen's conduct "diminished the capacity of the Panavision marks to identify and distinguish Panavision's goods and services on the Internet", and thus constituted dilution. Lately, the Trademark Dilution Revision Act of 2006 (H.R. 683), was signed into law, which overturned ''
Moseley v. V Secret Catalogue, Inc. ''Moseley v. V Secret Catalogue, Inc.'', 537 U.S. 418 (2003), is a decision by the Supreme Court of the United States holding that, under the Federal Trademark Dilution Act, a claim of trademark dilution requires proof of actual dilution, not me ...
'', . ''Moseley'' held the plaintiff needed to prove ''actual'' dilution under the Federal Trademark Dilution Act ("FTDA"). The new law revises the FTDA, requiring the plaintiff to show only that the defendant's mark is ''likely'' to cause dilution. However, the revision also reduced the universe of marks falling under its protection, requiring that marks be nationally well known to qualify for protection from dilution. For example, when Wolfe's Borough Coffee, Inc., a New Hampshire-based coffee company, sold its coffee under the trademarks that included the words "Charbucks Blend" and "Mr. Charbucks,"
Starbucks Corporation Starbucks Corporation is an American multinational chain of coffeehouses and roastery reserves headquartered in Seattle, Washington. It is the world's largest coffeehouse chain. As of November 2021, the company had 33,833 stores in 80 cou ...
sued, claiming that the use of the word "Charbucks" diluted the "Starbucks" mark by both blurring and tarnishment. The
Second Circuit Court of Appeals The United States Court of Appeals for the Second Circuit (in case citations, 2d Cir.) is one of the thirteen United States Courts of Appeals. Its territory comprises the states of Connecticut, New York and Vermont. The court has appellate juri ...
decided that marks need not be "substantially similar" under the FTDA for dilution to occur when other factors supporting a finding of dilution, such as the distinctiveness of the famous mark and the degree of its recognition, were present. In its decision, the court found that these other factors may be sufficient to support a dilution claim and remanded the case to the district court in order to determine whether dilution had in fact occurred. The district court ruled that sales of Charbucks did not violate the trademark and could continue.


See also

*
Generic trademark A generic trademark, also known as a genericized trademark or proprietary eponym, is a trademark or brand name that, because of its popularity or significance, has become the generic term for, or synonymous with, a general class of products ...
* Disparagement *
Counteraction principle The counteraction principle or counteraction theory is a legal principle which relates to the use of intellectual property where two marks are phonetically similar and where such a situation could lead to public confusion between brands. Relevant i ...


References


Further reading

* *


External links


Trademark Act of 1946 (aka Title 15, Chapter 22, of the United States Code)
Registration of trademarks is Sec. 1051, and the prohibition of dilution is in Sec. 1125 * Text of th
Trademark Dilution Revision Act of 2006
from GPO {{Trademark law
Dilution Dilution may refer to: * Reducing the concentration of a chemical * Serial dilution, a common way of going about this reduction of concentration * Homeopathic dilution * Dilution (equation), an equation to calculate the rate a gas dilutes * Trad ...