What is trademark tarnishment or dilution under US law?

Question

What is a person not allowed to do with a trademark in the US, beyond using falsely to sell goods? In what ways can a trademark owner prevent tarnishment (disparagement) or dilution (blurring)?

Answer 1

The key provision of the law is 15 U.S.C. 1125 (Section 43 of the Lanham Act): False designations of origin, false descriptions, and dilution forbidden.

Paragraph (a)(1)(A) forbids classic trademark infringement, where an actual trademark, or something confusingly similar to one, is used to deceive or confuse customers about “affiliation, connection, or association“ or “the origin, sponsorship, or approval of his or her goods, services, or commercial activities”

Paragraph (a)(1)(B) forbids

[The] use in commerce [of] any word, term, name, symbol, or device, … or any false designation of origin, false or misleading description of fact, or false or misleading representation of fact, which

...

in commercial advertising or promotion, misrepresents the nature, characteristics, qualities, or geographic origin of his or her or another person's goods, services, or commercial activities,

and authorizes a civil suit for actions which violate this.

In addition, paragraph (c)(1) provides that:

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.

Paragraph (c)(2)(B) says that:

"dilution by blurring" is association arising from the similarity between a mark or trade name and a famous mark that impairs the distinctiveness of the famous mark.

and

"dilution by tarnishment" is association arising from the similarity between a mark or trade name and a famous mark that harms the reputation of the famous mark.

Paragraph (c)(3) excludes:

(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 …

(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. (C) Any noncommercial use of a mark.

This means that suit for tarnishment or blurring can only be in response to a use of a mark in trade either:

• in a way that is similar to a protected mark so that the protected mark becomes less distinctive, that is more generic, or
• In a way that falsely or misleadingly harms the reputation of the protected mark.

Note that this is narrower than is often thoguht, or claimed by trademark holders. It will not apply to the actiosn of anyone not engaged in selling or advertising goods or services, so cease & desist letter addressed to people who have only engaged in non-commercial speech/writing will have no legal force. Even for those engaged in trade, it will not apply to comparitive advertising. That is, the sellers of BrandX may avertise “BrandX is better than BrandY because ...” using BrandY's trademarked name without fear of a dilution suit. It will also not apply to any other case where BrandY's trademark is used to identify BrandY, as long as the goods sold or advertised are not falsely described or implied to be BrandY, nor to be sponsored or authorized by BrandY or its makers.

In particular, parody of, criticizim of, or comment on BrandY, even by those promoting BrandX, is allowed. Reviewsl, even highly negative reveiws, are not grounds for suit under this law. Neither is any news report, or any non-commercial use of the trademark.

Note also that suit under this provision is only for dilution of a famous mark. Famous here means:

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.
(Par (a)(2)(A))

Marks that are not famous do not have this protection.

Moreover, US courts have further limited the concept of trademark protection because of First Amendment rights under the US Constitution.

The article “Balancing Free Speech and Trademark Rights” points out that:

courts adopted the doctrine of nominative fair use, which allows a third party to use or refer to another's mark when necessary and not misleading to consumers. Specifically, nominative fair use is not trademark infringement because there is no likelihood of confusion as to the source of the goods or services

and

use of an otherwise protectable mark in an expressive context is often protected free speech or otherwise considered fair use.

The Article “Free Speech Challenges to Trademark Law After Matal v. Tam” from the Houston Law Review (2018) points out that:

In Matal v. Tam, the U.S. Supreme Court clarified that trade-mark laws are speech regulations subject to First Amendment scrutiny when it held that the federal trademark law denying registration to potentially disparaging marks was unconstitutional.

The article goes on to predict that some areas of current trademark law will be found unconstitutional. It says:

Some trademark laws will survive First Amendment scrutiny after Tam* because they regulate speech that is not protected by the First Amendment. Government regulations of fraud and misleading commercial speech are generally constitutional because the First Amendment does not protect these categories of speech. Thus courts should find trademark registration and enforcement laws targeting fraudulent speech or misleading uses of marks in commercial expression to be valid regulations. … On the other hand, the U.S. Supreme Court has declared that speech regulations are presumptively unconstitutional and subject to strict or heightened scrutiny analysis when the law regulates noncommercial speech based on its content, or restricts any type of expression based on its viewpoint or ideas.

Heightened First Amendment scrutiny may be appropriate when considering the validity of the federal trademark infringement statutes since they do not explicitly exclude noncommercial uses of marks from their scope.(See 15 U.S.C. §§ 1114(1), 1125(a)(1)(A) (2012) , ...Lamparello v. Falwell, 420 F.3d 309, 313–14 (4th Cir. 2005)) Some courts have interpreted the language in these statutes in a speech-protective way to require commercial use of the mark for liability.(Radiance Found., Inc. v. NAACP, 786 F.3d 316, 322–24 (4th Cir. 2015); Utah Lighthouse Ministry v. Found. for Apologetic Info. & Research, 527 F.3d 1045, 1051–54 (10th Cir. 2008); Bosley Med. Inst., Inc. v. Kremer, 403 F.3d 672, 676–77 (9th Cir. 2005); Taubman Co. v. Webfeats, 319 F.3d 770, 774–75, 778 (6th Cir. 2003). ) But other courts believe infringement law is not limited to profit-seeking uses of trademarks and have applied the law in noncommercial contexts.(United We Stand Am., Inc. v. United We Stand, Am. N.Y., Inc., 128 F.3d 86, 92–93 (2d Cir. 1997) (applying the infringement statute to defendant's confusing use of the mark UNITED WE STAND AMERCIA to associate itself with the political movement that sponsored Ross Perot's presidential campaign). ) If the defendant's expression is not commercial in a trademark dispute, the court cannot reject a First Amendment defense on the ground that misleading commercial speech is not constitutionally protected.

...

After Tam, courts should either require commercial use of a mark for infringement or determine that application of infringement law to this noncommercial expression satisfies strict scrutiny analysis. If the expression is misleading and consumers are confused by unauthorized use of the distinctive marks of political groups and other non-profit organizations, the law may be constitutional. However, if this noncommercial use of the mark is not misleading, courts should refuse to find infringement

...

[O]ne area of trademark law that is unlikely to survive First Amendment scrutiny after Tam is dilution law. The federal dilution statutes prohibit unauthorized use of another's famous mark which is likely to cause dilution by blurring or dilution by tarnishment. Dilution by blurring is an association arising from the similarity between a mark or trade name and a famous mark that impairs the distinctiveness of the mark, while dilution by tarnishment is use of another's famous mark in a manner that is likely to harm the reputation of that mark. Both dilution laws regulate expression that is inconsistent with the brand message or ideas conveyed by a famous mark. Moreover, courts often apply the tarnishment provision to expression that some may find offensive.(V Secret Catalogue, Inc. v. Moseley, 605 F.3d 382, 388 (6th Cir. 2010)) After Tam, these dilution statutes should be subject to heightened First Amendment scrutiny because they prohibit and punish commercial expression based on its ideas or viewpoint. This constitutional analysis will be fatal, as the dilution laws cannot even survive the Court's intermediate scrutiny test for regulations of non-misleading commercial speech set forth in Central Hudson Gas & Elec. Corp. v. Pub. Serv. Comm'n of N.Y., 447 U.S. 557, 564 (1980).

Thus it seems that restrictions which trademark holders often which to enforce on the use, particularly the non-commercial use of their marks may not be valid under US law.