Trademark Law Unit 7 ReviewTrademark Defenses: Infringement & Dilution

Key Concepts

• Trademark infringement occurs when a party uses a trademark in a way that is likely to cause confusion, mistake, or deception about the source of goods or services
• Trademark dilution happens when a famous mark's distinctiveness is impaired by another's use, even if there is no likelihood of confusion
• Trademark owners have the exclusive right to use their marks in commerce and can sue for infringement or dilution to protect their rights
• Defendants in trademark lawsuits may raise various defenses to avoid liability, such as fair use, functionality, and abandonment
• Courts consider multiple factors in infringement cases, including the similarity of the marks, the relatedness of the goods/services, and evidence of actual confusion
• Dilution claims require showing that the plaintiff's mark is famous and distinctive, and that the defendant's use is likely to cause dilution by blurring or tarnishment
• Key cases like AMF Inc. v. Sleekcraft Boats and Moseley v. V Secret Catalogue have established important precedents in trademark law

Types of Trademark Infringement

• Direct infringement involves the unauthorized use of an identical or confusingly similar mark on competing goods or services
• Contributory infringement occurs when a party intentionally induces or facilitates another's direct infringement (Inwood Laboratories v. Ives Laboratories)
• Vicarious infringement happens when a party has the right and ability to control the infringing activity and benefits financially from it
• Reverse confusion arises when a larger, more powerful company uses a mark that is confusingly similar to a smaller company's pre-existing mark
• Initial interest confusion refers to situations where a consumer is initially attracted to a product due to confusion with another's mark, even if that confusion is dispelled before purchase
• Post-sale confusion can occur when a product's appearance leads others to believe it is a genuine article, even after the point of sale
• Gray market goods are genuine products imported from another country without the trademark owner's consent, which can sometimes constitute infringement

Elements of Trademark Infringement

• The plaintiff must prove ownership of a valid, protectable trademark
• The defendant must have used the mark in commerce without authorization
• The defendant's use must be likely to cause confusion, mistake, or deception among consumers
  • Courts assess likelihood of confusion using multi-factor tests that vary by jurisdiction
  • The most common test is the Polaroid factors, which include the strength of the plaintiff's mark, the degree of similarity between the marks, and evidence of actual confusion
• Plaintiffs may also need to show that their mark has priority over the defendant's use
• In some cases, plaintiffs must demonstrate that their mark has acquired secondary meaning (i.e., that consumers associate it with a particular source)

Common Defenses Against Infringement

• Fair use allows the use of another's trademark in a descriptive or nominative sense, rather than as a source identifier (KP Permanent Make-Up v. Lasting Impression I)
  • Descriptive fair use applies when the mark is used to describe the defendant's goods or services
  • Nominative fair use involves using the mark to refer to the plaintiff's product (New Kids on the Block v. News America Publishing)
• Functionality precludes trademark protection for features that are essential to the use or purpose of a product or affect its cost or quality (Qualitex v. Jacobson Products)
• Abandonment occurs when a trademark owner discontinues use with no intent to resume, causing the mark to lose its significance (ITC Ltd. v. Punchgini)
• Laches and acquiescence are equitable defenses that may apply if the plaintiff unreasonably delays in asserting their rights or actively consents to the defendant's use
• First Amendment considerations can sometimes override trademark rights, particularly in cases involving parody, criticism, or commentary
• Genericide happens when a once-distinctive mark becomes the generic name for a type of goods or services (Bayer Co. v. United Drug Co. - "aspirin")

Trademark Dilution Explained

• Dilution is a separate cause of action from infringement that does not require likelihood of confusion
• It applies only to famous, distinctive marks that are widely recognized by the general public
• Dilution by blurring occurs when an unauthorized use impairs the distinctiveness of the famous mark, weakening its ability to identify and distinguish goods/services
  • Example: "Kodak" bicycles or "Rolls-Royce" cat food
• Dilution by tarnishment happens when an unauthorized use harms the reputation of the famous mark, often through association with inferior or unseemly products
  • Example: "Budweiser" insecticide or "Barbie" adult entertainment
• The Trademark Dilution Revision Act of 2006 clarified the requirements for dilution claims and established statutory defenses

Defending Against Dilution Claims

• Defendants can argue that the plaintiff's mark is not sufficiently famous or distinctive to qualify for dilution protection
• The TDRA provides a fair use defense for comparative advertising, parody, criticism, and commentary
• Noncommercial use of a mark is exempt from dilution liability
• News reporting and commentary are also protected under the TDRA
• Defendants may challenge the plaintiff's evidence of likelihood of dilution, which can be shown through survey evidence or circumstantial factors
• Prior use can be a defense if the defendant used the mark before the plaintiff's mark became famous
• Defendants can sometimes argue that their use actually enhances rather than impairs the distinctiveness of the famous mark

Famous Cases and Precedents

• AMF Inc. v. Sleekcraft Boats (9th Cir. 1979) established an 8-factor test for likelihood of confusion that is widely used in trademark infringement cases
• Two Pesos v. Taco Cabana (1992) held that inherently distinctive trade dress can be protected without proof of secondary meaning
• Qualitex v. Jacobson Products (1995) confirmed that color alone can sometimes serve as a protectable trademark
• Moseley v. V Secret Catalogue (2003) initially required plaintiffs to prove actual dilution, but this was overturned by the TDRA in 2006
• KP Permanent Make-Up v. Lasting Impression I (2004) clarified the requirements for the fair use defense in infringement cases
• Louis Vuitton v. Haute Diggity Dog (4th Cir. 2007) found that a pet toy company's "Chewy Vuitton" products were a successful parody that did not infringe or dilute Louis Vuitton's marks
• Starbucks v. Wolfe's Borough Coffee (2nd Cir. 2009) held that the "Charbucks" coffee brand was not likely to dilute Starbucks' famous mark

Practical Applications and Examples

• Companies should carefully choose distinctive trademarks and conduct clearance searches to avoid infringing on others' rights
• Trademark owners must actively police their marks and enforce their rights against infringers to avoid abandonment or genericide
• Businesses should consider registering their marks federally and internationally to enhance protection and access to statutory remedies
• When facing infringement claims, defendants should evaluate potential defenses like fair use, functionality, and abandonment
• Famous mark owners should monitor unauthorized uses that may blur or tarnish their brands and consider dilution claims where appropriate
• Comparative advertising should be truthful and not misleading to qualify for the fair use defense
• Parody and commentary should be clearly distinguished from the original mark to avoid infringement or dilution liability
• In disputes, parties should assess the strength of their claims and defenses, potential damages, and litigation costs to inform strategy and settlement decisions