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Trademark dilution is a
trademark A trademark (also written trade mark or trade-mark) is a type of intellectual property Intellectual property (IP) is a category of property Property is a system of rights that gives people legal control of valuable things, and also r ...

trademark
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 The a ...
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, often called breakfast cereal (and further categorized as cold cereal or warm cereal), is a traditional breakfast food made from Processed food, processed cereal, cereal grains. It is traditionally eaten as part of a Balanced diet, balanced ...

breakfast cereal
s or
spark plug A spark plug (sometimes, in British English British English (BrE) is the standard dialect A standard language (also standard variety, standard dialect, and standard) is a language variety that has undergone substantial codification of ...

spark plug
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 Carbonation is the chemical reaction A chemical reaction is a process that leads to the chemical transformation of one set of chemical substances to another. Classically, chemical A chemical substance is a form of ...
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 Out-of-home (OOH) advertising, also called outdoor advertising, outdoor media, and out-of-home media, is advertising experienced ...
).


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 Carbonation is the chemical reaction A chemical reaction is a process that leads to the chemical transformation of one set of chemical substances to another. Classically, chemical A chemical sub ...

Coca-Cola
,
Kleenex Kleenex is a brand name A brand is a name, term, design, symbol or any other feature that identifies one seller's good or service as distinct from those of other sellers. Brands are used in business Business is the activity of making ...

Kleenex
,
Kool-Aid Kool-Aid is an American brand of flavored drink mix A drink mix or powdered drink mix is a processed-food product, a powder designed to mix usually with water to produce a beverage resembling fruit juice or soda in flavor. Another type of dri ...

Kool-Aid
, or
Sony , commonly known as Sony and stylized as SONY, is a Japanese multinational Multinational may refer to: * Multinational corporation, a corporate organization operating in multiple countries * Multinational force, a military body from mult ...

Sony
, and unique terms that were invented (such as
Exxon Exxon is the brand A brand is a name, term, design, symbol or any other feature that identifies one seller's good or service as distinct from those of other sellers. Brands are used in business, marketing, and advertising for recognition ...
) rather than surnames (such as
Ford Ford commonly refers to: * Ford Motor Company The Ford Motor Company, commonly known as Ford, is an American multinational automaker that has its main headquarters in Dearborn, Michigan, a suburb of Detroit (strait) , nicknames ...
or
Zamboni Zamboni or The Zamboni may refer to: * an ice resurfacer, commonly known as a "Zamboni" as a genericized trademark * Zamboni Company, a maker of ice resurfacers, founded by ice resurfacer inventor Frank Zamboni * The Zamboni (magazine), ''The Zam ...
) or ordinary words in language. Some
jurisdiction Jurisdiction (from Latin Latin (, or , ) is a classical language A classical language is a language A language is a structured system of communication Communication (from Latin ''communicare'', meaning "to share" or "to be i ...
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 Baseball is a bat-and-ball games, bat-and-ball game played between two opposing teams who take turns batting (baseball), batting and fielding. The game proceeds when a pl ...
' former mascot and logo,
Chief Wahoo Chief Wahoo is the name given to the logo used from 1951 to 2018 by the then named Cleveland Indians The Cleveland Guardians are an American professional baseball Baseball is a bat-and-ball games, bat-and-ball game played betw ...
, while the team was known as the Cleveland Indians at the time along with the
Washington Football Team The Washington Football Team is a professional American football team based in the Washington metropolitan area. Formerly known as the Washington Redskins, the team competes in the National Football League (NFL) as a member club of the NFC Ea ...
, 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 thos ...
'': 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, 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 The listing below comprises some of the more prominent houses of Champagne. Most of the major houses are members of the organisation ''Union de Maisons de Champagne'' (UMC),
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), according to the United States federal law The law of the United States comprises many levels of codified and uncodified forms of law Law is a system A system is a group of Interaction ...
). For example, in the 1998 case of ''Panavision International v. Toeppen'', defendant
Dennis Toeppen Dennis Toeppen is an American entrepreneur and was the owner of a litigious bus company Suburban Express. He was a party to two cases of first impression relating to Domain Name registration. Early life and education Dennis Eric Toeppen grew up ...
registered the domain name www.panavision.com, and posted aerial views of the city of
Pana, Illinois Pana is a city in Christian County, Illinois, Christian County, Illinois, United States. A small portion is in Shelby County, Illinois, Shelby County. The population was 5,847 at the 2010 census. History The area around Pana was first organized ...
on the site. The
Ninth Circuit Court of Appeals The United States Court of Appeals for the Ninth Circuit (in case citation Case citation is a system used by legal professionals to identify past court case A legal case is in a general sense a dispute between opposing parties which may be ...
found that trademark dilution occurred when potential customers of
Panavision Panavision is an American motion picture A film, also called a movie, motion picture or moving picture, is a work of visual art The visual arts are art forms such as painting Painting is the practice of applying paint Pa ...
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 ActThe Trademark Dilution Revision Act of 2006 (H.R. 683, ) was a law passed in the United States covering trademark law, and specifically dealt with trademark dilution. The act amended the Lanham Act, Trademark Act of 1946 and the later Federal Tradem ...
of 2006 (H.R. 683), was signed into law, which overturned '' Moseley v. V Secret Catalogue, Inc.'', . ''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 List of coffeehouse chains, chain of coffeehouses and Starbucks Reserve, roastery reserves headquartered in Seattle, Seattle, Washington. It is the List of coffeehouse chains, world's large ...
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 (state), New York and Vermont. The court ha ...
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 A trademark (also written trade mark or trade-mark) is a type of intellectual property Intellectual property (IP) is a category of prop ...
* Disparagement *
Counteraction principle The counteraction principle or counteraction theory is a legal principle which relates to the use of intellectual property Intellectual property (IP) is a category of property Property is a system of rights that gives people legal control ...


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