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COMMITTEE PRINT TO AMEND THE

FEDERAL TRADEMARK DILUTION ACT

HEARING

BEFORE THE

SUBCOMMITTEE ON COURTS, THE INTERNET, 

AND INTELLECTUAL PROPERTY

OF THE

COMMITTEE ON THE JUDICIARY 

HOUSE OF REPRESENTATIVES

ONE HUNDRED EIGHTH CONGRESS

SECOND SESSION

APRIL 22, 2004

Serial No. 72

Printed for the use of the Committee on the Judiciary

(

Available via the World Wide Web: http://www.house.gov/judiciary 
(II)

COMMITTEE ON THE JUDICIARY 

F. JAMES SENSENBRENNER, JR., Wisconsin, Chairman 

HENRY J. HYDE, Illinois 

HOWARD COBLE, North Carolina 

LAMAR SMITH, Texas 

ELTON GALLEGLY, California 

BOB GOODLATTE, Virginia 

STEVE CHABOT, Ohio 

WILLIAM L. JENKINS, Tennessee 

CHRIS CANNON, Utah 

SPENCER BACHUS, Alabama 

JOHN N. HOSTETTLER, Indiana 

MARK GREEN, Wisconsin 

RIC KELLER, Florida 

MELISSA A. HART, Pennsylvania 

JEFF FLAKE, Arizona 

MIKE PENCE, Indiana 

J. RANDY FORBES, Virginia 

STEVE KING, Iowa 

JOHN R. CARTER, Texas 

TOM FEENEY, Florida 

MARSHA BLACKBURN, Tennessee 

JOHN CONYERS, JR., Michigan 

HOWARD L. BERMAN, California 

RICK BOUCHER, Virginia 

JERROLD NADLER, New York 

ROBERT C. SCOTT, Virginia 

MELVIN L. WATT, North Carolina 

ZOE LOFGREN, California 

SHEILA JACKSON LEE, Texas 

MAXINE WATERS, California 

MARTIN T. MEEHAN, Massachusetts 

WILLIAM D. DELAHUNT, Massachusetts 

ROBERT WEXLER, Florida 

TAMMY BALDWIN, Wisconsin 

ANTHONY D. WEINER, New York 

ADAM B. SCHIFF, California 

LINDA T. SA ́ NCHEZ, California

PHILIP G. KIKO, Chief of Staff-General Counsel 

PERRY H. APELBAUM, Minority Chief Counsel 

SUBCOMMITTEE ON COURTS, THE INTERNET, AND INTELLECTUAL PROPERTY

LAMAR SMITH, Texas, Chairman

HENRY J. HYDE, Illinois 

ELTON GALLEGLY, California 

BOB GOODLATTE, Virginia 

WILLIAM L. JENKINS, Tennessee 

SPENCER BACHUS, Alabama 

MARK GREEN, Wisconsin 

RIC KELLER, Florida 

MELISSA A. HART, Pennsylvania 

MIKE PENCE, Indiana 

J. RANDY FORBES, Virginia 

JOHN R. CARTER, Texas 

HOWARD L. BERMAN, California 

JOHN CONYERS, JR., Michigan 

RICK BOUCHER, Virginia 

ZOE LOFGREN, California 

MAXINE WATERS, California 

MARTIN T. MEEHAN, Massachusetts 

WILLIAM D. DELAHUNT, Massachusetts 

ROBERT WEXLER, Florida 

TAMMY BALDWIN, Wisconsin 

ANTHONY D. WEINER, New York

BLAINE MERRITT, Chief Counsel 

DAVID WHITNEY, Counsel 

JOE KEELEY, Counsel 

MELISSA L. MCDONALD, Full Committee Counsel 

ALEC FRENCH, Minority Counsel 
(III)

C O N T E N T S 

APRIL 22, 2004

OPENING STATEMENT 

Page 

The Honorable Lamar Smith, a Representative in Congress From the State 

of Texas, and Chairman, Subcommittee on Courts, the Internet, and Intellectual Property .................................................................................................... 1

The Honorable Howard L. Berman, a Representative in Congress From the 

State of California, and Ranking Member, Subcommittee on Courts, the 

Internet, and Intellectual Property .................................................................... 3

WITNESSES 

Ms. Jacqueline A. Leimer, President, International Trademark Association 

Oral Testimony ..................................................................................................... 5

Prepared Statement ............................................................................................. 6

Mr. Robert W. Sacoff, Chair, Section of Intellectual Property Law, American 

Bar Association 

Oral Testimony ..................................................................................................... 13

Prepared Statement ............................................................................................. 15

Mr. Marvin J. Johnson, Legislative Counsel, American Civil Liberties Union 

Oral Testimony ..................................................................................................... 33

Prepared Statement ............................................................................................. 35

Mr. David C. Stimson, Chief Trademark Counsel, Eastman Kodak Company 

Oral Testimony ..................................................................................................... 44

Prepared Statement ............................................................................................. 45

APPENDIX 

MATERIAL SUBMITTED FOR THE HEARING RECORD

Letter from Michael K. Kirk, Executive Director, American Intellectual Property Law Association to the Honorable Lamar S. Smith, Chairman, Subcommittee on Courts, the Internet and Intellectual Property .......................... 56

(1)

COMMITTEE PRINT TO AMEND THE

FEDERAL TRADEMARK DILUTION ACT 

THURSDAY, APRIL 22, 2004

HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON COURTS, THE INTERNET,

AND INTELLECTUAL PROPERTY, 

COMMITTEE ON THE JUDICIARY, 

Washington, DC.

The Subcommittee met, pursuant to notice, at 10:03 a.m., in 

Room 2141, Rayburn House Office Building, Hon. Lamar S. Smith 

(Chair of the Subcommittee) presiding. 

Mr. SMITH. The Subcommittee on Courts, the Internet, and Intellectual Property will come to order. Today’s hearing is on the committee print to amend the Federal Trademark Dilution Act. I will 

recognize myself for an opening statement, then the gentleman 

from California, the Ranking Member. 

Let me say to our witnesses and those in the audience that we 

are not going to be unduly hasty this morning, but we are going 

to try to expedite just because there is a Judiciary Committee bill 

that will be on the House floor, I am guessing around 11 o’clock 

and we would like to have time to hear all the witnesses and ample 

time for Members to ask questions, as well. And I will recognize 

myself, as I say, for an opening statement. 

We communicate through words and symbols on a daily basis. 

The trademark for our favorite product or service immediately 

broadcasts its presence to the world. The foundation of trademark 

law is that certain words, images, and logos convey meaningful information to the public, including the source, quality, and good will 

of a product or a service. Unfortunately, there are those in both 

commercial and non-commercial settings who would seize upon the 

popularity of a trademark for their own purposes and at the expense of the rightful owner and public. 

Dilution refers to conduct that lessens the distinctiveness and 

value of a mark. This conduct can debase the value of a famous 

mark and mislead the consuming public. 

This Subcommittee wrote the Federal Trademark Dilution Act, 

or FTDA, during the 104th Congress. The act created additional 

and necessary protection for trademarks that was available for the 

first time on a national scale. While I believe that most policy makers, trademark scholars, and affected businesses would argue that 

the FTDA has functioned well since its passage, it is important for 

our Subcommittee to exercise its oversight prerogative and review 

the act’s operation. 
2

For instance, has the recent Supreme Court ruling on the FTDA, 

the Mosely decision, compromised the property rights of trademark 

owners, or has the law, as one of our witnesses will testify, conferred too much power on trademark holders at the expense of free 

speech? 

While review of the entire dilution statute is in order this morning, I hope that this Subcommittee and our witnesses will concentrate on the committee print before us. The primary components 

of the print include the following. 

Subject to the principles of equity, the owner of a famous distinctive mark is entitled to an injunction against any person who commences use in commerce of a mark that is likely to cause dilution 

by blurring or tarnishment. The print specifies that injunctive relief is appropriate, even if there is no actual or likely confusion 

among the public, competition between the owner and the person, 

or actual economic injury to the owner. 

A mark may only be famous if it is widely recognized by a general consuming public in the United States as a source designation 

of goods or services of the mark’s owner. In determining whether 

a mark is famous, a court is permitted to consider, quote, ‘‘all relevant factors,’’ end quote, in addition to prescribed conditions set 

forth in the print, including the duration, extent, and geographic 

reach of advertising and publicity of the mark. 

The print defines dilution by blurring as association arising from 

the similarity between a source designation and a famous mark 

that impairs its distinctiveness. Again, a court is permitted to consider all relevant factors in determining the presence of blurring. 

Specific factors that provide guidance in this regard include the 

degree of similarity between the source designation and the famous 

mark, the degree of inherent or acquired distinctiveness of the famous mark, and the degree of recognition of the famous mark. 

The print further defines dilution by tarnishment as association 

between a source designation and a famous mark arising from 

their similarity that harms a reputation of the famous mark. 

The committee print enumerates specific defenses to a dilution 

action: Fair use and comparative commercial advertising to identify 

the competing goods, non-commercial use of source designation, 

and all forms of news reporting and news commentary. 

Finally, the owner of a famous mark is only entitled to injunctive 

relief under the committee print unless in an action based on dilution by blurring the defendant willfully intended to trade on the famous mark’s recognition or, in an action based on dilution by 

tarnishment, the defendant willfully intended to trade on the famous mark’s reputation. In either case, the owner may also seek 

damages, costs, and attorneys’ fees. 

Substantial portions of the committee print are based on the existing FTDA, but there are conspicuous differences between the 

texts. Under the committee print and in response to the Mosely decision, actual harm is not a prerequisite for injunctive relief. The 

definitions of blurring and tarnishment are new. The committee 

print also expands the threshold of fame and thereby denies protection for marks that are famous only in niche markets, which represents a deviation from case law in some circuits. 
3

Finally, the committee print specifies that State remedies for dilution are not preemptive. 

We have a very interesting subject today and an excellent roster 

of witnesses who can speak on the merits of dilution and so we look 

forward to their testimony. With that, I will recognize Mr. Berman, 

the Ranking Member. 

Mr. BERMAN. Thank you, Mr. Chairman, and thank you for 

scheduling this oversight hearing to discuss the committee print to 

amend the Federal Trademark Dilution Act. 

It has been over 8 years since the passage of that act and sufficient time has passed to analyze the effects of the Dilution Act on 

trademark law. We did a preliminary analysis 2 years ago when we 

held a hearing on the Dilution Act in which we discussed proposed 

legislation to change the standard from actual dilution to likelihood 

of dilution. A much shorter bill than this one, its goal was to resolve the conflict between the circuits about the standard for dilution. That bill was held up for various reasons, including that the 

Supreme Court finally took a dilution case in an attempt to resolve 

the conflict. We are back here today because some believe the conflict has not been resolved. 

In 1995, the Federal Trademark Dilution Act was passed in order 

to protect, quote, ‘‘famous trademarks from subsequent uses that 

blur the distinctiveness of the mark or tarnish or disparage it,’’ end 

of quote. As a result of varying State dilution laws, the purpose 

was to bring uniformity and consistency to the protection of famous 

marks. However, a significant split developed among the courts in 

the interpretation of key elements of the Dilution Act. 

Last year, the Supreme Court took the step to resolve the controversy in its decision in Mosely v. Victoria’s Secret Catalog. The 

Supreme Court interpreted the legislative intent of the Dilution Act 

to require demonstration of actual dilution based on the wording in 

the statute that the use would cause dilution. However, they did 

not require proof of lost sales or profits. The Court questioned 

whether dilution by tarnishment was covered by the act, as there 

was no specific reference to the theory within the language of the 

act. 

If we were to maintain an actual dilution standard as the Supreme Court suggests, a number of issues arise, including how 

would one prove actual dilution without demonstrating lost profits? 

Furthermore, the classic view of dilution by blurring is that the injury caused by dilution is the gradual diminution or whittling away 

at the value of the famous mark, or as Professor McCarthy analogizes, it is like being stung by 100 bees where significant injury is 

caused by the cumulative effect, not just one. 

So then how do we determine that one small use can blur the 

distinctiveness of a famous mark, and at that point, is it already 

too late? The committee print before us today makes a number of 

changes to the act, the most notable being the clarification of the 

standard of dilution from actual to one of likelihood of dilution. Actual harm would no longer be a prerequisite to injunctive relief. 

In addition, the amendments include a clear reference to dilution 

by tarnishment. Furthermore, it elucidates the definition of fame 

by providing a list of factors, and also eliminates the protection of 

marks famous only in a niche market. 
4

I appreciate the expressed need to impose a more lenient standard. A likelihood of dilution standard would no longer unfairly require the senior user to, one, wait until injury occurs before bringing suit, or secondly, face the threat that the senior user failed to 

actively protect their marks. It would also allow new companies to 

seek a declaratory judgment that their mark does not dilute, which 

would prevent unnecessary expenditures in the launch of their 

products. However, I am not convinced that a likelihood of dilution 

standard combined with the other amendments in the committee 

print do not create an aura of over-protectionism. 

When establishing the Federal Dilution Act, we memorialized a 

doctrine that protects the property interest in a trademark, not just 

the typical infringement goal which is designed to protect the public from confusion. Are we now creating a situation which provides 

a zone of exclusivity for a trademark? One of our goals is to maintain the balance between fair competition and free competition to 

keep the economy working at a reasonable rate of efficiency and 

competitiveness. With passage of a lesser standard, will we, in essence, create a trademark protection which translates to a property 

right en grosse? 

Furthermore, I am concerned how, if at all, this will affect First 

Amendment and Free Speech issues. Subsequent to the hearing 

this Subcommittee held on the Dilution Act in February of 2002, 

the ACLU voiced concerns relating to stifling critics with the potential weapon of an injunction for a mere likelihood of tarnishment. 

They are concerned with the balance between the rights of trademark holders and the First Amendment. 

I am interested in hearing further about these issues and why 

these concerns may not be addressed in the exemptions for fair use 

in advertising, non-commercial use, and news reporting provided 

for in the act, or in the alternative, what is included in this legislation to specifically protect that freedom. 

I look forward to hearing from the witnesses to shed light on why 

the standard needs to be changed and how the legislation would affect balance in the economic market, trademark litigation, and free 

speech forums. 

I look forward to working with you, Mr. Chairman, to further 

evaluate the act and the changes recommended at today’s hearing. 

I yield back. 

Mr. SMITH. Thank you, Mr. Berman. 

Our first witness is Jacqueline Leimer, who is testifying on behalf of the International Trademark Association, or INTA. Ms. 

Leimer is President of INTA and also serves as Chief Counsel, 

Global Trademarks for Kraft Foods Global, Incorporated. Before 

joining Kraft, Ms. Leimer was a partner in the Chicago law firm 

of Kirkland and Ellis. She received her B.A. and J.D. degrees from 

Valpraiso University. 

The next witness is Mr. Robert Sacoff, who is testifying on behalf 

of the American Bar Association. Mr. Sacoff chairs the ABA’s Intellectual Property Law Section and is a partner in the law firm of 

Pattishall, McAuliffe, Newbury, Hilliard, and Geraldson. In addition to having served on the boards of the American Intellectual 

Property Law Association and INTA, Mr. Sacoff lectures exten-
5

sively on trademark law. He earned his A.B. degree from Notre 

Dame and his J.D. from Northwestern. 

Our third witness is Marvin Johnson, who serves as Legislative 

Counsel for the American Civil Liberties Union, where he focuses 

on First Amendment issues. Before relocating to Washington, Mr. 

Johnson worked as Executive Director of the ACLU chapter in his 

native Wyoming. Mr. Johnson earned his B.S. and J.D. degrees 

from the University of Wyoming. 

Our final witness is David Stimson, the Chief Trademark Counsel for Eastman Kodak, where he has worked since 1986. Before 

joining Kodak, Mr. Stimson was a partner in the New York firm 

of Rogers, Hoge, and Hills. He received his B.A. from Hamilton College and his J.D. from the University of Cincinnati. 

Welcome to you all. We have your written statements, and without objection, the entire written statements will be made a part of 

the record. 

Ms. Leimer, we will begin with you. 

STATEMENT OF JACQUELINE A. LEIMER, PRESIDENT, 

INTERNATIONAL TRADEMARK ASSOCIATION 

Ms. LEIMER. Good morning, Mr. Chairman. Thank you for holding today’s hearing. 

Perhaps the easiest way to realize the value of trademarks is to 

imagine a world without them. How would we decide what food to 

buy, whose services to use, or how to differentiate the medicines 

prescribed by our doctors? Trademarks tell us what we like, what 

is safe, and what represents quality. They are an important part 

of everyday life, and for this reason, the law protects against trademark infringement, the use of trademarks in a manner that confuses or deceives consumers. 

Next, I ask you to think about those marks, relatively few in 

number, that are so well known that they have become a cultural 

icon. They come to mind without the slightest hesitation and inspire what leading trademark scholar Jerry Gilson has called abundant goodwill and consumer loyalty. These are famous marks, and 

in 1996, the Federal Trademark Dilution Act was enacted to provide them with additional protection. 

There are two widely accepted types of dilution. The first is blurring, a reduction in the distinctiveness of the famous mark, its ability to identify goods or services as originating from a particular 

source. The second is tarnishment of a famous mark’s reputation. 

In a dilution case, the court can enjoin a junior use that blurs or 

tarnishes a famous mark even when there is no infringement. 

A Federal dilution remedy has played an important role in protecting famous trademarks. It helped to stem the tide of cyber 

squatting during the earliest days of online commerce and stopped 

uses like ‘‘Adults-R-Us,’’ an obvious play on Toys-R-Us, from being 

used as a source for sexually explicit material. 

In spite of these successes, there remain a number of dilutionrelated issues on which the courts are split and the language of the 

statute led the Supreme Court in its Mosely decision to rule that 

proof of actual harm is required in a dilution case, a decision that 

does not account for the need to prevent dilution at its incipiency 

before the effectiveness and reputation of the famous mark is lost. 
6

INTA has therefore come to the conclusion that the FTDA is in 

need of revision. 

Because the dilution remedy can be applied regardless of infringement, we suggest that it be available only to a narrow class 

of marks, specifically, those marks that are widely recognized by 

the general consuming public of the United States. This should be 

explicit in the statute. Non-exclusive factors are a useful guide in 

determining whether a mark meets the standard and the committee print sets forth what those factors might be. 

The statute should also expressly provide that famous marks are 

protected from the likelihood that they will be diluted. This standard permits a famous mark owner to prevent dilution at its incipiency and not have to wait until the mark is damaged beyond repair. 

We further recommend that the dilution statute be revised to 

make it clear that there are two distinct causes of action, one for 

likelihood of dilution by blurring and one for likelihood of dilution 

by tarnishment. In each case, there should be no liability unless 

the famous mark owner can prove a likely association between its 

mark and the junior use based on the similarity between the two 

marks. With respect to tarnishment, a plaintiff should have to 

demonstrate that this likely association would harm the reputation 

of the famous mark. 

In a case of blurring, the plaintiff should also demonstrate that 

the likely association would, over time, impair the distinctiveness 

of the famous mark. Where the famous mark and junior use are 

identical, this should not be difficult to do. Not so clear, however, 

is what analysis should take place when the famous mark and the 

junior use are not identical. To remedy this, a revised statute 

should provide a list of non-exclusive factors for a court to use in 

rendering a decision. Again, the committee print details what those 

factors might be. 

A revised statute should also preserve the First Amendment defenses in the current FTDA. These defenses have worked well. To 

further protect free speech rights, we suggest that the plaintiff in 

a dilution case be required to demonstrate that the defendant is 

using the challenged mark as a designation of source for its own 

goods or services. In other words, he is using the challenged mark 

as his own trademark. This requirement will protect fair uses of a 

famous mark and safeguard all legitimate parody and satire, even 

if that parody and satire appear in a commercial context. 

This concludes my opening statement. I thank the Subcommittee 

for the opportunity to testify. I would be pleased to answer your 

questions. 

Mr. SMITH. Thank you, Ms. Leimer. 

[The prepared statement of Ms. Leimer follows:]

PREPARED STATEMENT OF JACQUELINE A. LEIMER

I. INTRODUCTION

Good morning, Mr. Chairman. My name is Jacqueline A. Leimer. I am chief counsel, global trademarks for Kraft Foods Global, Inc. and serve as president of the 

International Trademark Association (INTA). As do all INTA officers, board members and committee members, I serve INTA on a voluntary basis. 
7

1Pub. L. No. 104–98, 109 Stat. 505 (1995). 2 123 S. Ct. 1115 (2003). 

3See 134 Cong. Rec. S. 16974 (daily ed. Oct. 20, 1988) (Statement of Sen. DeConcini). 4See, e.g., S. Rep. No. 106–140, 106th Cong. 1st Sess. (1999) (relying on statements by INTA’s president, made before the Senate Judiciary Committee). 5See H.R. Rep. No. 412, 106th Cong. 1st Sess. (1999). 6See Cong. 126 Rec. S. 9690 (daily ed. October 1, 2002) (Statement of Senator Leahy). 7See H. Rep. No. 104–879, 104th Cong. 2nd Sess. (1997) (noting use of testimony from INTA’s executive vice president). 8The United States Trademark Association (predecessor to the International Trademark Association), ‘‘The United States Trademark Association Trademark Review Commission Report and 

Recommendations to USTA President and Board of Directors,’’ 77 Trademark Rep. 375, 455 

(1987). 9 15 U.S.C. § 1125(c). 10 15 U.S.C. § 1127. 11 15 U.S.C. § 1125(c). 12Pub. L. No. 106–43. 

INTA supports revision of the Federal Trademark Dilution Act (FTDA) 1 and encourages Congress to enact legislation that will provide greater clarity regarding 

protection afforded under the statute, better define the standard of proof for dilution, and strengthen protection for free speech interests. INTA’s support for revising 

the FTDA in this manner comes after a nine-month comprehensive study of dilution 

law that was undertaken by a select committee of trademark experts. My predecessor as INTA president, Kathryn Barrett Park, organized the select committee 

after the U.S. Supreme Court decision in Moseley v. V Secret Catalogue, Inc.,2 in 

which the court addressed a number of dilution issues, particularly the standard of 

proof for a dilution claim. I was honored to have chaired the select committee in 

my capacity then as the executive vice president of INTA. 

INTA is a 126-year-old not-for-profit organization comprised of over 4,300 members. It is the largest organization in the world dedicated solely to the interests of 

trademark owners. The membership of INTA, which crosses all industry lines and 

includes both manufacturers and retailers, values the essential role that trademarks 

play in promoting effective commerce, protecting the interests of consumers, and encouraging free and fair competition. INTA has a long history of making recommendations to the Congress in connection with federal trademark legislation, including: the Trademark Law Revision Act of 1988 (TLRA),3 the Anticybersquatting 

Consumer Protection Act of 1999,4 the Trademark Law Treaty,5 and the Madrid 

Protocol Implementation Act.6

II. HISTORY OF THE FTDA

INTA was also a prime advocate for passage of the FTDA, which became law on 

January 16, 1996.7 The association believed that a federal dilution statute was 

needed to protect famous marks because ‘‘[t]hey are enormously valuable but fragile 

assets, susceptible to irreversible injury from promiscuous use.’’ 8

The FTDA affords protection that is different from trademark infringement protection. Dilution does not rely upon the standard test of infringement, that is, the 

likelihood of confusion, deception, or mistake. Rather, the FTDA provides equitable 

relief to the owner of a famous mark against another person’s commercial use of 

a mark or trade name that lessens the ‘‘distinctive quality of the [famous] mark,’’ 9

‘‘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.’’ 10 The statute also sets forth criteria that a court should consider in determining whether a mark is famous; establishes an injunction as the primary form 

of relief; and provides statutory defenses to a dilution claim.11 In 1999, Congress 

granted holders of famous trademarks the right to oppose a trademark application 

or cancel a trademark registration based on dilution of their marks.12

III. THE NEED FOR REVISION OF THE FTDA

Since its adoption in 1996, the FTDA has served a valuable role in protecting famous trademarks. For example, during the earliest days of online commerce, before 

Congress passed the Anticybersquatting Consumer Protection Act, the FTDA helped 

to stem the tide of the registration and trafficking in Internet domain names with 

the bad-faith intent to benefit from another’s trademark. At the same time, however, after more than eight years, there remain open questions and courts are divided on a number of key dilution-related concepts regarding the intent of Congress 

when it adopted the FTDA. For example:
8

13 I.P. Lund Trading ApSand Kroin Inc. v. Kohler Co and Robern, Inc., 163 F.3d 27, 46 (1st 

Cir. 1998). 14See, e.g., Nabisco, Inc. v. PF Brands, Inc., 191 F.3d 208, 215 (2d Cir. 1999) (The term ‘‘fame’’

is used in an ‘‘ordinary English language sense’’ in the FTDA.); Gazette Newspapers, Inc. v. New 

Paper, Inc., 934 F. Supp. 688, 690 (D. Md. 1996). In the Gazette case, ‘‘the court applied the 

FTDA to protect the use of ‘Gazette’ in only two counties in Maryland. The court failed to recognize, however, that there are at least seven major newspapers around the country that use

‘Gazette’ in their titles.’’ Paige Dollinger, ‘‘The Federal Trademark Anti-Dilution Act: How Famous is Famous?’’ at http://www.kentlaw.edu/honorsscholars/2001Students/writings/

dollinger.html#—ftnref66, citations omitted. 15 Cases supporting niche fame, see, e.g., Advantage Rent-A-Car, Inc. v. Enterprise Rent-A-Car, 

238 F.3d 378, 381 (5th Cir. 2001) (‘‘Enterprise needed only to show that its ‘We’ll Pick You Up’

mark is famous within the car rental industry, not in a broader market.’’); Thane Int’l, Inc. v. 

Trek Bicycle Corp., 305 F.3d 894 (9th Cir. 2002) (‘‘We are bound by Avery Dennison, 189 F.3d 

868 (9th Cir. 1999), to accept and apply the niche fame concept.’’). Not in support of niche fame,

see, e.g., TCPIP Holding Co. v. Haar Comms., Inc., 244 F.3d 88, 99 (2d Cir. 2001) (It is unlikely 

that ‘‘Congress intended to grant such outright exclusivity to marks that are only famous in a 

small area or segment of the nation.’’); I.P. Lund Trading ApSand Kroin Inc. v. Kohler Co and 

Robern, Inc., 163 F.3d 27 (1st Cir. 1998). 16See, e.g., TCPIP Holding Co. v. Haar Comms., Inc., 244 F.3d 88, 95 (2d Cir. 2001) (ruling 

that protection under the FTDA is limited to famous marks that are inherently distinctive); 

Avery Dennison Corp. v. Sumpton, 189 F.3d 868, 877 (9th Cir. 1999) (‘‘We reject appellant’s argument that the distinctiveness required for famousness under the Federal Trademark Dilution 

Act is inherent, not merely acquired distinctiveness.’’); Times Mirror Magazine, Inc. v. Las Vegas 

Sporting News LLC, 212 F.3d 157, 167 (3d Cir. 2000) (holding that marks that have acquired 

distinctiveness are eligible for protection under the FTDA). 17 123 S. Ct. 1115, 1124 (2003). 18 4 J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition δ24:67, at 24–

128 (4th ed. 2003). See also 2 Jerome Gilson, Trademark Protection and Practice § 5A.01[2], at 

5A–7 (Rel. 50-December 2003). 19Moseley v. V Secret Catalogue, Inc., 123 S. Ct. 1115, 1124 (2003).

1. What is a famous mark? Some courts have opted to be more ‘‘discriminating 

and selective’’ 13 in terms of what is protectable, while others have defined 

fame more broadly.14 In particular, should marks that are famous only in a 

‘‘niche’’ market and, therefore, well known only to a select class or group of 

purchasers, or in a limited geographic region, qualify as ‘‘famous’’ within the 

meaning of the present statute? This too is an unsettled question.15

2. Does the FTDA only protect famous marks that are inherently distinctive, 

or does it also cover famous marks that have acquired distinctiveness, i.e., 

gained secondary meaning over time? 16 In trademark parlance, ‘‘distinctiveness’’ refers to the ability of a mark to identify goods or services as originating from a particular source—either immediately (as in the case of inherently distinctive marks) or only after a significant period of time or investment (as in the case of marks with acquired distinctiveness). 

3. Whether tarnishment is covered under the FTDA was a question posed by 

the Supreme Court in dicta in the Moseley decision. This comment was based 

on the statutory language ‘‘dilution of the distinctive quality of the famous 

mark,’’ which, in the view of the court, might not go to injury to the reputation of a famous mark, the underlying concept of dilution by tarnishment.17

Notwithstanding this question, tarnishment, along with blurring, has long 

been and is still regarded by trademark scholars as one of the ‘‘two different 

dimensions’’ of dilution.18

4. Finally, what is dilution and how does a famous trademark owner go about 

proving it? In Moseley, the Supreme Court held that the FTDA requires proof 

of actual harm and that consumers’ mere mental association between the famous and challenged marks, whatever its effect on the famous mark, is generally insufficient to establish such harm, particularly when the marks in 

question are not identical.19 But, as I will explain later, this holding is problematic, as it does not account for the need to prevent dilution at its incipiency, before the effectiveness and reputation of the mark is lost. 

These and other key questions, Mr. Chairman, should be answered through a revision of the FTDA, and not by forum shopping or waiting for further costly litigation to provide us with a solution. Congress should take the opportunity to better 

focus the application of the federal dilution statute, while at the same time clarifying the meaning of the harm the statute aims to prevent, as well as the manner 

in which a dilution claim is proven. 
9

20 2 Gilson, supra note 18, § 5A.01[4][a], at 5A–10. 21TCPIP Holding Co. v. Haar Comms., Inc., 244 F.3d 88, 95 (2d Cir. 2001). 22 4 McCarthy, supra note 18, § 24:91.1, at 24–166 (commenting on existing FTDA) (citation 

omitted). 23 Id., δ24:112.1, at 24–273. 24Dilution cases are not limited by similarities of the goods, or confusion, or other marketplace factors. ‘‘[A] dilution injunction . . . will generally sweep across broad vistas of the economy.’’ Mattel, Inc. v. MCA Records, Inc., 296 F.3d 894, 905 (9th Cir. 2002). 

IV. REVISING THE FTDA

Below are the principles underlying INTA’s recommendation for a revision of the 

FTDA. To help the subcommittee in its review, I have divided these recommendations into four categories: ‘‘Qualifications for Protection,’’ ‘‘Blurring and 

Tarnishment,’’ ‘‘Safeguarding Free Speech,’’ and ‘‘Relief and Preemption.’’

A. Qualifications for Protection 

INTA believes that fame should remain the critical requirement to qualify for federal dilution protection. As Jerome Gilson, a leading U.S. trademark law expert has 

stated, these marks inspire ‘‘abundant good will and consumer loyalty . . . and federal dilution law protects the substantial investment necessary to advertise and promote the mark.’’ 20

A revised dilution statute should expressly state that famous marks with inherent 

or acquired distinctiveness are eligible for protection, because at least one circuit 

court of appeals has found enough ambiguity in the current statute to exclude famous marks with acquired distinctiveness 21 and because a designation that ‘‘has 

achieved trademark status only through the acquisition of secondary meaning is certainly capable of acquiring a greater degree of distinctiveness and achieving the status of ‘famous’ mark.’’ 22

While INTA believes that fame should remain the threshold needed in order to 

qualify for protection under a federal dilution statute, we do suggest that a revised 

statute should be more explicit as to what marks qualify as ‘‘famous.’’ INTA recommends that Congress define the scope of fame as being limited to marks, whether 

or not they are registered with the U.S. Patent and Trademark Office, that are 

‘‘widely recognized by the general consuming public of the United States.’’ This 

standard does narrow the set of marks that would qualify for federal dilution protection. But, in our opinion, it is an appropriate step. This new standard would help 

to alleviate the ‘‘contradictory and inconclusive’’ 23 nature of the existing statutory 

language and legislative history on this issue, which has led to inconsistent decision-making and discomfort among some judges who feel compelled to render a finding of fame even though the mark in question is well known to a limited number 

of people. It will ensure that the broad protections against dilution provided for in 

the statute are available only to the select class of marks for which improper associations would be most damaging.24 In addition, we believe this standard would also 

allow smaller companies to use marks in their businesses without undue restriction. 

Under the proposed standard, marks that are famous in a niche product or service 

market or that are recognized only in a limited geographic region will not qualify 

for federal dilution protection. State dilution laws and, in appropriate cases, infringement and unfair competition statutes, such as § 43(a) of the Lanham Act, will 

afford adequate protection of the senior user’s mark in these cases. 

INTA considers non-exclusive factors to be a useful guide to mark owners and the 

judiciary in determining whether a mark is famous. The current FTDA fame factors 

that a court may consider are, but are not limited to:

(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 marks’ 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; 

and
10

25 15 U.S.C. § 1125(c)(1). 26Moseley v. V Secret Catalogue, Inc., 123 S. Ct. 1115, 1124 (2003). 27 Id. (emphasis added). 28 Id. (commenting on the ruling of the Fourth Circuit in Ringling Bros.—Barnum & Bailey 

Combined Shows, Incorporated v. Utah Division of Travel Development, 170 F.3d 449 (4th 

Cir.1999)). 

(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.25

INTA proposes that the existing fame factors be simplified and replaced as follows:

(A) the duration, extent, and geographic reach of advertising and publicity of 

the mark, whether advertised or publicized by the owner or third parties;

(B) the amount, volume, and geographic extent of sales of goods or services offered under the mark; and

(C) the extent of actual recognition of the mark.

The first and second factors reflect traditional concepts of marketplace recognition 

that courts have applied for decades and incorporate some of the existing factors. 

The third factor, ‘‘the extent of actual recognition of the mark,’’ is meant to incorporate survey evidence, market research such as brand awareness studies, and even 

unsolicited media coverage. 

Some of the factors contained in the current statutory test are omitted from 

INTA’s proposal. For the most part, their absence stems from the fact that they are 

already accounted for in the definition itself, or are, in our view, not relevant to the 

issue of fame. For example, since INTA’s proposed definition of fame specifies that 

the mark must be ‘‘widely recognized by the general consuming public of the United 

States,’’ the current factors dealing with the geographic extent of use and recognition in the junior user’s trading area and channels of trade are no longer necessary. 

Because the mere existence of a registration is really not relevant at all to the question of fame, we suggest that it be omitted as well. 

B. Blurring and Tarnishment 

In INTA’s opinion, famous marks should be expressly protected by statute from 

the likelihood that they will be either blurred or tarnished. A revised statute should 

be clear on what constitutes a likelihood of dilution by blurring and what constitutes 

likelihood of dilution by tarnishment. 

1. The Incipient Nature of Dilution 

First, why should likelihood of dilution be actionable as opposed to actual dilution? This question was at the heart of the Moseley case. In its decision, the Supreme Court ruled, ‘‘the text [of the FTDA] unambiguously requires a showing of 

actual dilution, rather than a likelihood of dilution.’’ 26 In particular, the court cited 

Section 43(c)(1) of the Lanham Act, which provides that ‘‘the owner of a famous 

mark’’ is entitled to injunctive relief against another person’s commercial use of a 

mark or trade name if that use ‘‘causes dilution of the distinctive quality’’ of the 

famous mark.27 The court did, however, hold that proof of actual dilution does not 

require a showing of the economic consequences of dilution, such as lost sales or revenues.28

INTA submits that a dilution cause of action should not require an actual, provable change in the way consumers think about the famous mark. This approach, 

which the Supreme Court adopted based on the language of the existing FTDA, does 

not account for the need to prevent dilution at its incipiency, the core concept underlying the dilution remedy. In the opinion of INTA, the owner of a famous mark 

should be able to obtain an injunction against the first offending use, even if that 

use has not yet resulted in provable damage to the mark. Because dilution is a process by which the value of a famous mark is diminished over time, either by one or 

multiple users, the owner of the famous mark should not be required to wait until 

the harm has advanced so far that, in the case of blurring, the recognition of the 

mark, and in a tarnishment case, the reputation of the mark, is permanently impaired. 

Moreover, if the owner of a famous mark must wait years to challenge the multiple uses that have entered the marketplace in the interim, the defendants in those 

cases will be poorly served as well. Junior users will have invested in the allegedly 

diluting marks over the course of time, placing their accrued goodwill in great jeopardy. And, given the great hardship that a junior user could suffer as a result of 

delay in challenging the marks, a court could apply the laches defense. The present 

FTDA, as interpreted by the Supreme Court, thus presents the plaintiff with a Hob-
11

son’s choice: sue too early and lose because the harm is not yet provable, or sue too 

late and lose on laches grounds. 

Accordingly, the most practical way to express the incipient nature of dilution in 

a manner a court will understand, is to expressly phrase the cause of action as a 

likelihood of dilution—that is, that the junior use is likely to cause dilution (whether 

by blurring or by tarnishment) if allowed to continue unchecked. 

2. Dilution by Blurring 

INTA recommends a new statutory approach to addressing a claim of likelihood 

of dilution by blurring. We recommend that the statute require the owner of a famous mark to prove a likelihood of association between its mark and the junior 

mark, arising from the similarity of the marks, which would impair the distinctiveness of the famous mark. 

Under this test, not just any mental association will suffice—it must be an association that arises from the similarity (or identity) of the two marks, as opposed to 

an association that arises because of product similarities or competition between the 

owners of the two marks. Moreover, it is association that is likely to impair the distinctiveness of the senior mark. 

For example, let us assume that the CLOROX mark is ‘‘widely recognized by the 

general consuming public of the United States.’’ It is a completely made up term, 

created only for the purpose of functioning as a trademark, not used elsewhere in 

the commercial arena, and associated only with a supplier of household cleaning 

products and detergents. If another company begins to produce CLOROX sneakers, 

there is little question that consumers will draw an association between the two 

marks due to their identity and the high degree of distinctiveness of the mark. This 

association will over time reduce the distinctiveness of the CLOROX mark, i.e., it 

will make it less likely over time that consumers will identify the goods and services 

bearing the name CLOROX as originating from a particular source. In short, dilution is highly likely, and indeed is probably already underway, although the impairment to the senior mark may not yet be manifest. 

Another situation would be one where the famous, senior mark is not as distinctive as CLOROX or the junior mark is not identical or virtually identical to the senior mark. In this type of situation, courts could use the factors for dilution by blurring (addressed later) to determine whether the requisite association and impairment are likely. The use of the likelihood of dilution standard in INTA’s proposal 

would make clear that relief can be granted based on a court’s assessment of the 

relevant factors, without proof of actual dilution as presently required by the Supreme Court in Moseley. 

3. Blurring Factors 

INTA recommends that a revised federal dilution statute contain non-exclusive 

factors to assist courts in determining whether there is a likelihood of dilution by 

blurring. A court will need to balance all of these factors, as well as any others it 

may deem relevant in order to make a determination as to whether there is a likelihood of dilution by blurring. INTA proposes that Congress consider the following:

1. The degree of similarity between the junior use and the famous mark.

2. The degree of inherent or acquired distinctiveness of the famous mark.

3. The extent to which the owner of the famous mark is engaging in substantially exclusive use of the mark.

4. The degree of recognition of the famous mark.

5. Whether the junior user intended to create an association with the famous 

mark.

6. Any actual association between the junior use and the famous mark.

Factor one is self-evident and refers to step one of the blurring analysis: How 

similar are the two marks? The less similar the marks, the less likely a consumer 

association between the marks. 

The degree of inherent or acquired distinctiveness of the famous mark considers 

the extent to which the public may identify the mark with a single source. Further, 

this factor considers whether the mark is sufficiently strong to allow single-source 

identification upon initial use of the mark. The more distinctive and memorable the 

mark, the more it is likely to be blurred by the use of other identical or similar 

marks. The more common or descriptive the mark, the less likely it is to be blurred 

by uses of identical or similar marks. 

Factor three, the extent to which the owner of the famous mark is engaging in 

substantially exclusive use of the mark, asks the court to determine whether other 

trademark uses similar to the famous mark already exist in the marketplace. If, for 

example, the famous mark is in substantially exclusive use, it could indicate that 
12

29Descriptive fair use (or classic fair use) is the use of a normal English word in its normal 

English meaning to describe one’s own product or service. 30 Nominative fair use is when the alleged infringer uses the plaintiff’s mark to refer to the 

plaintiff or the plaintiff’s goods. It generally applies (a) where the mark is reasonably needed 

to identify the mark owner’s goods or services, (b) where the use is not more than is needed 

to identify the mark owner’s goods or services, and (c) where there is no implication of endorsement. See, e.g., New Kids on the Block v. News Am. Publ’g, Inc., 971 F.2d 302 (9th Cir. 1992). 31 15 U.S.C. § 1125(c)(4).

the mark’s distinctiveness is more likely to be impaired by the junior use. Conversely, where other similar marks are already in use, it may be somewhat less likely that the junior use will have the effect of blurring the famous mark, unless those 

uses have little or no visibility to the average consumer. 

The degree of recognition is another way of asking, ‘‘just how famous is the famous mark?’’ The more famous the mark, the more likely it will be memorable such 

that the association will be made, and the more likely that the association will impair the distinctiveness of the mark in the sense of how well it stands out in the 

marketplace. 

If it is found that the defendant intended to trade on the recognition of the famous mark, then the defendant presumably used the junior mark with the expectation that consumers would associate their mark with the famous mark. This factor 

operates as an admission by the defendant that the senior mark has a sufficient degree of fame such that the mark can be blurred, and that the defendant sought to 

appropriate that fame to itself in order to direct consumers’ attention toward its 

own mark. 

The last factor, actual association, refers to evidence found in surveys, news items 

that reference both of the marks, and other evidence that may support a finding 

that the requisite association between the marks is likely to occur. 

4. Dilution by Tarnishment 

In light of the ambiguity created by the Supreme Court’s comments in the Moseley

decision, INTA believes that it is important to expressly state in a revised federal 

dilution statute that tarnishment is within the scope of the law. Owners of famous 

trademarks should be able to protect their significant investment against negative 

associations, absent a protectable free speech interest, which is discussed in more 

detail below. INTA suggests that a revised federal dilution statute find liability for 

tarnishment if a junior use is likely to harm the reputation of the famous mark. 

This standard is used in state dilution statutes and most courts have capably adjudicated claims of tarnishment under this standard. 

C. Safeguarding Free Speech 

INTA believes that it is essential when revising the federal dilution law for Congress to confirm that the rights of famous mark owners do not interfere with free 

speech protections that are guaranteed by the First Amendment. To accomplish this 

goal, we recommend that a revised dilution statute expressly provide as an essential 

element of the cause of action for dilution, whether for dilution by blurring or dilution by tarnishment, that the plaintiff demonstrate that the defendant is using the 

challenged mark as a ‘‘designation of source’’ (e.g., trademark, trade name, logo, etc.) 

for the defendant’s own goods or services. 

A requirement of defendant’s use as a designation of source will prevent any descriptive fair use 29 or nominative fair use 30 from falling within the ambit of the 

revised statute. For example, a defendant using a famous mark to refer to the trademark owner’s goods in comparative advertising, or a newspaper using the famous 

mark to refer to the mark owner’s goods for purposes of news reporting or commentary, would not qualify as use as a designation of source for the defendant’s own goods or services, and therefore would not be covered by the statute at all. Moreover, the requirement of use as a designation of source for the junior user’s own 

goods or services should protect all legitimate parody and satire, even if that parody 

and satire appears in a commercial context. It is INTA’s strong belief that this requirement is necessary to protect free speech and to ensure that dilution protection 

is appropriately limited. 

The ‘‘designation of source’’ requirement will serve to strengthen the existing statutory defenses to a dilution claim:

(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.31
13

32See, e.g., Mattel, Inc. v. MCA Records, Inc., 296 F.3d 894 (9th Cir. 2002); American Family 

Life Insurance Co. v. Hagan, 64 U.S.P.Q.2d 1865, 1874–75. In these cases, both courts provided 

a broad application of the FTDA’s noncommercial exemption. 

These defenses, as interpreted and applied by the courts, have worked well to protect parties using famous marks as a form of free expression and should therefore 

remain part of a revised federal dilution law.32

D. Relief and Preemption 

INTA recommends that an injunction should continue to be the principal form of 

relief in a federal dilution claim. The plaintiff should continue to be entitled to remedies set forth in Sections 35(a) (profits, damages, and cost of the action) and 36 

(destruction of goods bearing the registered mark) of the Lanham Act, subject to the 

discretion of the court and the principles of equity, if willful intent is proven. However, we suggest that a revised statute specify that in order to recover damages, 

willful intent to trade on the recognition of the famous mark must be proved for 

blurring claims, and willful intent to trade on the reputation of the famous mark 

must be proved for tarnishment claims. 

INTA believes that a federal dilution statute should not preempt state dilution 

laws because preemption would adversely affect the ability of relief for intrastate 

and regional conduct to the extent permitted under state dilution laws. A valid federal registration should, however, be a complete bar to a state dilution claim. This 

is the scenario under the FTDA and we recommend that it remain unchanged in 

a revised federal dilution statute. 

V. CONCLUSION

Thank you, Mr. Chairman, for the opportunity to testify before the subcommittee. 

INTA looks forward to working with Congress and interested parties in addressing 

issues related to the revision of the FTDA.

Mr. SMITH. Mr. Sacoff. 

STATEMENT OF ROBERT W. SACOFF, CHAIR, SECTION OF INTELLECTUAL PROPERTY LAW, AMERICAN BAR ASSOCIATION 

Mr. SACOFF. Mr. Chairman, Congressman Berman, thank you for 

your invitation to the ABA to appear before you today. The views 

that I express today and have expressed in our written statement 

advocating amendment of the Federal Trademark Dilution Act of 

1985 to change the actual dilution standard articulated by the Supreme Court in Mosely to a likelihood of dilution standard have 

been adopted as ABA policy by our Board of Governors, therefore, 

represent views of the association. My comments on the other 

issues represent the views of the Intellectual Property Law Section, 

which I chair, as they have not gone up to or been approved by the 

House of Delegates or Board of Governors of the American Board 

Association. 

As you know, the ABA is a volunteer association of many lawyers. Briefly, I would just like to mention that many of its hardworking members contributed to the work that led to the policy 

statements we have submitted, the lengthy statement with a lot of 

case analysis—I can’t name them all, but wish to mention my colleague, Jonathan Jennings, who chaired the Federal Trademark 

Legislation Committee, and also Jonathan Hadis, who is here this 

morning, who led the Subcommittee on this very large project. 

It is timely and important to revisit the Federal Trademark Dilution statute to fix certain problems that have become apparent 

through its eight-and-a-half years of experience in the courts and 

its interpretation by the Supreme Court in the Mosely case. We advocate in principle three amendments to the statute. We advocate 

these principles as that is the way we have discussed them and 
14

considered them and made them ABA policy. We have not formulated ABA policy on the actual specific language of the proposed 

draft and the committee print. We would be happy to work with 

the Subcommittee, however, in connection with language questions. 

We advocate, first, creating a likelihood of dilution standard for 

adjudicating dilution cases under the Federal statute in both the 

courts and the Trademark Trial and Appeal Board. 

Secondly, we advocate an amendment allowing famous marks 

that have acquired their distinctiveness through use and recognition to be eligible for protection against dilution instead of the 

more restrictive category of inherently distinctive marks, as suggested by the minority view in the Second Circuit and as suggested 

by possible dicta in the Supreme Court. 

And three, we recommend amending the statute to expressly include dilution by tarnishment as being actionable under the statute. 

We believe these amendments are consistent with the intent of 

the Federal Trademark Dilution Act and are necessary to allow the 

statute to function properly. I will talk about them in a little more 

detail and also comment on the niche market fame issue, which we 

believe is not quite ripe for a legislative solution. 

First, likelihood of dilution. The Supreme Court’s decision in 

Mosely requiring actual dilution has created a lot of uncertainty 

and unpredictability in the lower courts as they struggle with the 

quantum of proof and type of trial evidence necessary to establish 

actual dilution. The actual dilution standard is unworkable in practice and essentially guts the trademark dilution statute. We believe 

it should be amended to provide that cases of trademark dilution 

should uniformly be decided under the likelihood of dilution standard. 

The Court in Mosely even recognized when it was making its decision that it was creating problems of proof and stated in the 

course of its opinion, ‘‘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,’’ as it referred to 

actual dilution. 

But the Mosely case has created problems of proof and a complicated kind of bifurcated standard or system for dealing with 

cases where the marks are identical or the marks are not identical 

or the marks are almost identical. Unless the parties’ marks are 

identical, post-Mosely actual dilution opinions almost uniformly 

have dismissed dilution claims due to the absence of sufficient evidence under the Mosely standard, although there is no uniform 

view as to what that type of evidence would be. 

Judge Posner in the Seventh Circuit decision of Ty, Inc. v. 

Softbelly’s, involving the Beanie Babies company, expressed great 

skepticism even of survey evidence in providing actual dilution, 

which is quite telling as to the difficulties of proof that the Mosely

standard has created, because survey evidence is traditionally one 

of the most classic and most persuasive and most informative 

forms of trial evidence that trademark lawyers utilize in both prosecuting and defending against trademark claims of various sorts. 

Mosely has even divided the courts on protecting identical marks. 

Its comments have been interpreted in a couple of different ways. 
15

The court said it may be that direct evidence of dilution, such as 

surveys, will not be necessary if actual dilution can be proven 

through circumstantial evidence. The obvious case is one where the 

junior and senior marks are identical. Well, this has been interpreted as where the junior and senior marks are identical, the fact 

that the identity is in itself sufficient to prove dilution. In other 

cases, the courts say, well, when the marks are identical, additional evidence is still necessary, but it can be circumstantial as 

well as direct. 

Mosely also divides the Trademark Trial and Appeal Board from 

the district courts in dealing with dilution cases under the Federal 

Act. In the Trademark Board, oppositions can be filed against intent-based applications where there is no use of the mark yet and, 

therefore, by definition, the use of the mark, the proposed use of 

the mark has to be deemed likely to cause dilution if the opposition 

is on the dilution ground. We believe that a uniform standard 

should be set to even out these inconsistencies. 

We believe a likelihood of dilution standard is consistent with the 

First Amendment. We endorse the continuation of the exceptions, 

the defenses that are stated for proper areas of use. Nobody really 

has been using, in our view, the dilution statute as it presently exists to stifle free speech, and frankly, a likelihood of dilution standard has been in place under the State dilution statutes which exist 

for many, many years and we don’t believe that there has been empirical evidence of the erosion of First Amendment rights as a result of that. 

In conclusion, we believe a likelihood of dilution standard should 

be adopted. If the status quo remains, the Federal Trademark Dilution Act will not be an effective means of protecting famous marks. 

Second, briefly on acquired distinctiveness. As I mentioned earlier, there are two kinds of——

Mr. SMITH. Mr. Sacoff, maybe we can get to that during the question and answer period, since we are out of time. 

Mr. SACOFF. I will be happy to do that, and will rely upon our 

written statement for the remainder of our detail. 

Mr. SMITH. Very good. Thank you, Mr. Sacoff. 

[The prepared statement of Mr. Sacoff follows:]

PREPARED STATEMENT OF ROBERT W. SACOFF

Mr. Chairman and members of the Subcommittee: 

Thank you for the opportunity to testify on behalf of the American Bar Association and that Association’s Section of Intellectual Property Law. My name is Robert 

W. Sacoff. I am a partner in the law firm of Pattishall, McAuliffe, Newbury, Hilliard 

& Geraldson, and I currently serve as Chair of the ABA Section of Intellectual Property Law. The views that I express supporting amendment of the Federal Trademark Dilution Act of 1995 (the ‘‘FDTA’’) to provide that questions of trademark dilution should be resolved under the ‘‘likelihood of dilution’’ standard have been adopted as ABA policy by our Board of Governors, and therefore represent views of the 

Association. Views expressed on other issues regarding the FDTA have not been approved by the House of Delegates or Board of Governors of the Association. Those 

views are those of the Section of Intellectual Property Law (IP Law Section) alone. 

The Federal Trademark Dilution Act of 1995 was enacted on January 16, 1996. 

After eight years of experience under the Act, it is appropriate that Congress revisit 

the statute to identify areas of possible amendment and improvement, and we applaud the Subcommittee for initiating that exercise. The Subcommittee has asked 

the witnesses today to consider a number of options for amendment to the FTDA. 

We have done so, and offer three recommendations in this regard and general comments on a fourth issue concerning niche market fame. 
16

EXECUTIVE SUMMARY

The Federal Trademark Dilution Act should be amended in three ways: (1) creating a ‘‘likelihood of dilution’’ standard; (2) providing a specific cause of action for 

dilution by tarnishment; and (3) allowing for non-inherently distinctive marks to be 

eligible for protection. These three amendments are consistent with the intent of the 

FTDA. In addition, they are necessary to allow for the statute to function properly. 

The Supreme Court’s recent decision in Moseley requiring actual dilution has led 

to uncertainty and unpredictability in the lower courts as they struggle with the 

quantum of proof and type of evidence necessary to establish actual dilution. The 

actual dilution standard has proven unworkable in practice. There should be no concern about the 

impact this proposed amendment will have on free speech, since there is no conflict between the likelihood standard and the First Amendment. 

The Moseley decision cast doubt on whether the FTDA creates a cause of action 

for tarnishment. The majority of courts prior to Moseley did recognize an antitarnishment provision in the FTDA, based on the legislative history. Moseley, however, called this into question. Therefore, the call for a legislative amendment on 

this issue is understandable, and the ABA IP Law Section supports clarification of 

this matter by an amendment to the FTDA to expressly provide a cause of action 

for dilution by tarnishment. 

Finally, the Second Circuit has added an additional requirement to the FTDA, 

namely that a mark must be inherently distinctive to qualify for protection. In other 

words, under this minority view some of the most famous ‘‘supermarks’’ (e.g., FORD 

automobiles, DELL computers) might not be eligible for protection under the FTDA 

even though they have acquired massive distinctiveness and fame. This minority position therefore precludes the owners of some famous marks from exercising the 

rights Congress intended to grant them. There is concern that this minority position 

may be followed by more courts because the Moseley decision, in dicta, made comments that could be interpreted to support the Second Circuit’s view. 

Unlike the above issues, there is no consensus in the trademark law community 

as to whether the FTDA currently protects marks that have acquired niche fame 

or should protect such marks. Thus, a legislative amendment is not appropriate at 

this time. 

I. LIKELIHOOD OF DILUTION STANDARD

The Federal Trademark Dilution Act should be amended to provide that cases of 

trademark dilution before the federal courts and Trademark Trial and Appeal Board 

of the USPTO should be uniformly decided under the ‘‘likelihood of dilution’’ standard. Our analysis of the FTDA leads us to the conclusion that the likelihood of dilution standard is not only preferable, but clearly is what Congress intended. Nonetheless, in light of the Supreme Court’s decision in Moseley v. V. Secret Catalogue, 

Inc., an amendment to the FTDA is now needed to provide ‘‘likelihood of dilution’’

as the standard. 

A. Moseley v. V. Secret Catalogue, Inc.

In Moseley v. V. Secret Catalogue, Inc., 123 S. Ct. 1115 (2003), the Supreme Court 

held that the text of the FTDA ‘‘unambiguously requires a showing of actual dilution, rather than a likelihood of dilution.’’ Id., 123 S. Ct. at 1124. The Court went 

on to state ‘‘that does not mean that the consequences of dilution, such as an actual 

lost of sales or profits, must also be proved. . . . [A]t least where the marks are 

not identical, the mere fact that consumers mentally associate the junior user’s 

mark with a famous mark is not sufficient to establish actionable dilution.’’ Id., 123 

S. Ct. at 1124. Further, the Court said, ‘‘direct evidence of dilution such as consumer surveys will not be necessary if actual dilution can reliably can be proven 

through circumstantial evidence—the obvious case is one where the junior and senior marks are identical. 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.’’ Id., 123 S. Ct. at 1125. Illustrative cases are reviewed below. 

B. Problems Of Proof Created By Moseley

The Supreme Court’s ‘‘actual dilution’’ standard in Moseley has become an incredibly difficult criterion by which to measure adequate proof of dilution. Unless the 

parties’ marks were identical, post-Moseley ‘‘actual dilution’’ opinions almost uniformly have dismissed dilution claims due to the absence of sufficient evidence 

under the Moseley standard. Even in cases where the parties’ marks were identical, 

the Moseley decision has been interpreted by some courts as requiring ‘‘extra’’ burdens of proof. So that otherwise qualifying famous marks can be given the proper 
17

1 Judge Posner’s skepticism on this point notwithstanding, several district courts have found 

actual dilution, on various showings, when the marks at issue were identical. See Savin Corp. v. The Savin Group, No. 02 Civ.9377 SAS, 2003 WL 22451731, *14–*15 (S.D.N.Y. Oct. 24, 2003); 

Scott Fetzer Co. v. Gehring, 288 F.Supp.2d 696, 2003 WL 22429698, *5 (E.D.Pa. Sept. 23, 2003); 

Nike Inc. v. Variety Wholesalers, Inc., 274 F.Supp.2d 1352, 1372 (S.D.Ga. 2003); Four Seasons 

Hotels and Resorts B.V. v. Consorcio Barr, S.A., 267 F.Supp.2d 1268 (S.D.Fla. 2003); and Pinehurst, Inc. v. Wick, 256 F.Supp.2d 424, 431–432 (M.D.N.C. 2003), discussed below. In the case 

at bar, as Judge Posner noted, neither ‘‘Beanies’’ nor ‘‘Beanie Babies’’ were identical to ‘‘Screenie 

Beanies.’’ See Softbelly’s, 2003 WL 22994564 at *7. 

scope of protection intended by Congress, the FTDA should be revised to expressly 

include a ‘‘likelihood of dilution’’ standard. 

Ty, Inc. v. Softbelly’s, Inc., No. 03–1592, 2003 WL 22994564 (7th Cir. Dec. 22, 

2003): Although the ‘‘actual dilution’’ discussion is quite brief, this decision contains 

language that casts some doubt on consumer surveys as proof of dilution. In an 

opinion written by Judge Posner, the Seventh Circuit reversed judgment as a matter of law for the manufacturer of ‘‘Beanie Babies’’ in a trademark infringement and 

dilution case against the manufacturer of ‘‘Screenie Beanies,’’ small, plush, stuffed 

animals sold in computer stores for use in wiping computer screens. See Softbelly’s,

2003 WL 22994564 at *1. On the dilution claim, the Court held that the district 

court’s ruling for Ty ‘‘had scant grounding in the evidence.’’ Id. at *6. Indeed, the 

Court found that ‘‘no evidence of any sort was presented that would have enabled 

a trier of fact to infer any lessening in the capacity of ‘Beanies’ or ‘Beanie Babies’

to ‘identify and distinguish’ the plush beanbag animals sold by Ty’’ and remanded 

for a new trial on the issue. Id. at *6–7, citing Moseley, 123 S. Ct. 1115 (2003). 

Judge Posner noted that Moseley ‘‘impl[ied] a need for trial-type evidence’’ to determine whether dilution had occurred. Id. at *6. Commenting indirectly on the Supreme Court’s reference to consumer surveys as direct evidence of actual dilution 

Moseley, 123 S. Ct. at 1125, Judge Posner expressed his skepticism that any ‘‘question could be put to consumers that would elicit a meaningful answer either in that 

case or this one.’’ Id., (citing Jonathan Moskin, ‘‘Victoria’s Big Secret: Whither Dilution Under the Federal Dilution Act?’’, 93 Trademark Rep. 842, 853 (2003)). Regarding the suggestion that circumstantial evidence might be sufficient to prove actual 

dilution where the disputed marks were identical, Moseley, 123 S. Ct. at 1125, 

Judge Posner somewhat acerbically observed that the Supreme Court ‘‘did not explain and no one seems to know what that ‘circumstantial evidence’ might be.’’ 1 Id.

at *7. 

Caterpillar Inc. v. Walt Disney Co., 287 F. Supp. 2d 913, 922, (C.D. Ill. 2003): The 

court began its treatment of dilution by noting that Moseley and its actual dilution 

requirement pertained only to blurring and, in the case at bar, Caterpillar did not 

argue blurring, but rather tarnishment. See Caterpillar, 287 F.Supp.2d at 921–922. 

The court noted Moseley left open the question of whether tarnishment fell within 

the scope of the FTDA. Id. at 922. Assuming that actual dilution must be shown 

for tarnishment cases, the court further observed, ‘‘it is unclear what type of showing Caterpillar must make,’’ although it is clear that Caterpillar need not prove loss 

of sales of profits nor by direct evidence such as a consumer survey, but may rely 

on circumstantial evidence. Id. (citing Moseley, 123 S. Ct. at 1124). Because Disney’s 

movie had not yet been released, there was nothing in the record to suggest that 

Caterpillar had lost sales or profits, nor any consumer survey evidence showing actual dilution. See, Id. Accordingly, there was nothing in the record to show that Caterpillar was likely to succeed on its dilution claim and therefore no basis to support 

its request for a TRO. See, Id.

Although the court does not spell this out, presumably circumstantial evidence 

would be sufficient because the marks that Disney used in its movie were ‘‘identical,’’ indeed, were Caterpillar’s own mark. It may be inferred that, because the 

court did not hold that the ‘‘identity’’ of the marks was sufficient in itself to prove 

dilution, the court was siding with the ‘‘identity plus’’ line of post-Moseley decisions, 

although the lack of any discussion or analysis on this point makes this inference 

speculative at best. 

Kellogg Co. v. Toucan Golf, Inc., 337 F.3d 616 (6th Cir. 2003): This case began 

when Kellogg opposed registration of the word mark ‘‘Toucan Gold’’ for use in connection with golf clubs and golf putters. (Defendant Toucan Golf was a manufacturer of golf equipment for sale primarily to companies who used the clubs as promotional gifts at charity events.) See Toucan Golf, 337 F.3d at 620–621. In appealing the decision of the Trademark Trial and Appeal Board (‘‘TTAB’’) permitting the 

registration to the federal district court, Kellogg claimed that the word mark and 

an unregistered cartoon toucan logo used by Toucan Golf infringed and diluted 

Kellogg’s famous Toucan Sam design and word marks. Id. at 622. Rejecting both 
18

claims, the district court and the Sixth Circuit Court of Appeals affirmed the 

TTAB’s decision. 

As the Sixth Circuit interpreted Moseley, the Supreme Court held that Plaintiff 

V. Secret’s dilution claim failed because it ‘‘did not present any empirical evidence 

that consumers no longer clearly understood to which products the ‘Victoria’s Secret’

mark was related, and thus failed to demonstrate the ‘lessening of the capacity of 

the Victoria’s Secret mark to identify and distinguish goods or services sold in Victoria’s Secret stores or advertised in its catalogs.’ ’’ Id. at 628 (citing Moseley, 123 

S.Ct. at 1125) (emphasis added). Similarly, the Sixth Circuit found, Kellogg presented no evidence that Toucan Golf’s use of its toucan marks ‘‘has caused consumers no longer to recognize that Toucan Sam represents only Froot Loops’’ or that 

‘‘any segment of the population recognizes Toucan Sam as the spokesbird only for 

Froot Loops in lesser numbers than it did before TGI started using its toucan 

marks.’’ Id. (emphases added). Indeed, the court emphasized, Kellogg presented one 

survey conducted in 1991 that showed 94% of children recognized Toucan Sam and 

81% related him to Froot Loops and another from 1997, after Toucan Golf started 

business, that showed 94% recognition of Toucan Sam among adults. Id.

The Sixth Circuit’s opinion is problematic on several levels, and demonstrates a 

potentially far-reaching implication of the Supreme Court’s Moseley decision. 

Moseley nowhere articulated the ‘‘no longer clearly understood’’ standard that the 

Sixth Circuit invoked, and the Court cited no authority in case law, statute, or legislative history in support of it. The Sixth Circuit thus gave no real parameters to 

the standard. For example, what percentage showing in a consumer survey would 

suffice to prove dilution? What would be the relevant universe and the relevant time 

frame for such a survey? How would causation be proven? And how would factors 

like market conditions and general consumer preferences be treated in the survey 

analysis? (Of course, the latter is a fundamental flaw in the actual dilution standard 

itself, which the Second Circuit emphasized in Nabisco, Inc. v. PF Brands, Inc., 191 

F.3d. 208 (2nd Cir. 1999), and which the Moseley Court failed to address.) 

Practically speaking, Toucan Golf presents strategic dilemmas for dilution claimants and litigators. The surveys that the Sixth Circuit relied upon to reject Kellogg’s 

dilution claim were presented as evidence of Toucan Sam’s strength and fame. Id.

at 624 (noting that Kellogg presented the 1991 survey in support of ‘‘the strength 

of its Toucan Sam marks’’). The 1997 survey the Court relied upon also was submitted to demonstrate fame; was a survey of a different universe (adults, not children); and was conducted after Toucan Golf had begun business but before the 

Toucan Gold mark was used in commerce. Id. at 624 (noting that Toucan Golf’s application for ‘‘Toucan Gold’’ was an ‘‘intent to use’’ application) and 628. Nevertheless, the Sixth Circuit apparently based its conclusion that Kellogg had failed to 

prove any erosion in consumer recognition of its marks on that second survey. 

While the Sixth Circuit’s standard is quite amorphous, dilution claimants seeking 

to rely on survey evidence in that jurisdiction may need to have conducted a fame 

survey before the junior mark was introduced and then another (using the same 

survey instrument?) at some point thereafter, and the results will have to show erosion in consumer recognition of some uncertain amount. If, for example, a senior 

mark holder discovers a purportedly diluting use within the statute of limitations, 

but has not conducted a pre-use survey, Toucan Golf could be read to suggest the 

senior user may be unable to prove actual dilution for lack of a pre-junior-mark 

benchmark survey. However, such surveys, aside from their cost, present the danger 

of being used in litigation against claimants by alleged diluters, if they do not demonstrate erosion in consumer recognition. 

C. Moseley’s Divisive Impact On The Issue Of Protecting Identical Marks 

In Moseley, the Supreme Court stated a dictum touching on the situation where 

the disputed marks in a dilution claim are identical: ‘‘It may be, however, that direct 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.’’ Moseley, 123 S. Ct. at 1125. 

The statement has given rise to several decisions and a split of authority among 

the lower courts. 

Savin Corp. v. The Savin Group, No. 02 Civ.9377 SAS, 2003 WL 22451731, 

(S.D.N.Y. Oct. 24, 2003): As Judge Scheindlin of the Southern District of New York 

observed, the Moseley’s Court’s statement is subject to at least two different readings: (1) When the junior and senior marks are identical, the fact of the identity 

is in itself ‘‘sufficient circumstantial evidences to prove actual dilution.’’ Or, (2) when 

the marks are identical, circumstantial evidence as opposed to direct evidence may 

prove dilution. See Savin Group, 2003 WL 22451731 at *14, citing Nike Inc. v. Vari-
19

ety Wholesalers, Inc., 274 F.Supp.2d 1352, 1372 (S.D.Ga. 2003) and Pinehurst, Inc.

v. Wick, 256 F.Supp.2d 424, 431–432 (M.D.N.C. 2003), respectively. 

In Savin Group, a dispute over identical marks of plaintiff office services company 

and defendant professional engineering consultants, the court found the second interpretation more plausible. Id. at *1–*2, *14–*15. Judge Scheindlin emphasized the 

sentence that followed the dictum in Moseley: ‘‘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.’’ Id. at *15, quoting 123 S. Ct. at 1125. In other 

words, as Judge Scheindlin read the passage, even when the marks are identical, 

additional proof of actual dilution is required; the simple fact of identity does not 

suffice. Accordingly, because plaintiff in the case at bar offered no proof beyond the 

identity of the marks, it ‘‘failed to raise a material issue of fact with regard to an 

essential prong of the dilution test,’’ warranting summary judgment for defendant. 

Id.

HBP, Inc. v. American Marine Holdings, Inc., No. 6:02–CV–957–ORL22DAB, 2003 

WL 22593589, (M.D.Fla. Oct. 10, 2003): The identical mark at issue in this case was 

‘‘Daytona,’’ used by plaintiff HBP as a trade and service mark for stock car and motorcycle races and by the defendant boat manufacturer for a line of recreational 

powerboats. Id. at *2–3. Granting summary judgment for American Marine on the 

dilution claim, the court first found that HBP’s mark was not famous for dilution 

purposes. See American Marine, 2003 WL 22593589 at *2–*3. The court found further that, even if HBP’s mark was famous, HBP had failed to prove actual dilution 

under Moseley. The court pointed, in part, to the lack of evidence ‘‘demonstrating 

that [HBP’s] customers and potential customers have, as a result of American Marine’s use of the ‘Daytona’ mark on its boats, formed any different impression of 

HBP’s products and services.’’ Id. at *16. (Although this resembles ‘‘tarnishment’’

language, only dilution by blurring was at issue in the case and the court’s supporting citation to Mead Data Central, Inc. v. Toyota Motor Sales, U.S.A., Inc., 875 

F.2d 1026, 1029 (2d Cir. 1989), suggests that blurring was what it had in mind.) 

There was an interesting procedural misstep in this case. HBP offered into evidence excerpts from a deposition transcript that it contended showed American Marine’s use of the ‘‘Daytona’’ mark had caused loss of licensing revenue and dilution 

of existing royalty value. Id. at *15. The opinion gives the deponent’s name (Glenn 

Padgett), but does not identify who he was or what relationship he had to either 

of the parties. The court did not consider this evidence, however, because HBP had 

failed to file the deposition transcript as part of the record before the Court. Id. This 

is unfortunate, because it leads to intriguing speculation of just how Mr. Padgett 

purportedly demonstrated loss of licensing revenue and what the court’s findings 

might have been had the evidence been admitted. 

Scott Fetzer C. v. Gehring, 288 F.Supp.2d 696 (E.D. Pa. 2003): This is one of the 

opinions in which the court held that the identity of the marks was, in and of itself, 

sufficient circumstantial evidence to prove dilution, although it did point to other 

circumstantial evidence supporting its finding. See Scott Fetzer, 288 F. Supp. 2d at 

702. Plaintiff was the parent company of a vacuum cleaner business that had used 

the famous Kirby trademark since 1930. Id. at 700. Defendant ran a vacuum cleaner store and repair business that widely used the Kirby mark in its advertisements, 

including in the store’s name—‘‘Kirby Vacuum Sales & Service,’’ despite not being 

authorized to use the mark or to sell or service Kirby vacuum cleaners. Id.

In holding that defendant’s use of the Kirby trademark ‘‘lowered the value and 

esteem of plaintiff’s mark,’’ the court reasoned that ‘‘where the competing entities 

are using marks that are identical, dilution may be reliably found using the circumstantial evidence of the identical marks.’’ Id. at 701–702; citing Moseley, 123 S. 

Ct. at 1125. In addition to the identity of the marks, the court noted that defendant 

sold second-hand Kirby vacuum cleaners without permission and falsely advertised 

that these machines came with a one-year-manufacturer’s guarantee. Id. at 703 

These facts taken together, the court concluded, sufficed to prove plaintiff’s dilution 

claim. Id. at 703. 

Nike Inc. v. Variety Wholesalers, Inc., 274 F.Supp.2d 1352, 1372 (S.D.Ga. 2003): 

As in Scott Fetzer, the court in this case concluded that identity of the marks was 

sufficient evidence to prove dilution, albeit without any analysis or rationale beyond 

citing the Moseley dictum. While otherwise a complicated case, for dilution purposes 

the facts were simple: Defendant was a low-cost, ‘‘secondary market’’ clothing retail 

chain, which plaintiff proved was selling counterfeit Nike products. See Variety 

Wholesalers, 274 F.Supp.2d at 1355, 1357. The court concluded that Variety Wholesalers had diluted Nike’s famous trademarks ‘‘due to the identical or virtually identical character of the marks on the Accused Goods to the Nike trademarks.’’ Id. at 

1372 (citing Moseley, 123 S.Ct. at 1125) (emphasis added). 
20

Four Seasons Hotels and Resorts B.V. v. Consorcio Barr, S.A., 267 F.Supp.2d 1268 

(S.D. Fla. 2003): At issue was a complex dispute between a licensor and licensee involving breach of contract, claims of industrial espionage and trademark issues. 

Four Seasons, the famous luxury hotel chain, had contracted with Consorcio Barr 

to build and operate the Four Seasons hotel in Caracas, Venezuela, and licensed defendant to use its brand name, trademarks, and logo for that purpose. See Consorcio 

Barr, 267 F.Supp.2d at 1271–1272. However, the relationship was plagued with 

problems from the beginning. Consorcio failed to open the hotel on time; important 

facilities including suites, the poolside restaurant, and the spa were not completed 

at the hotel’s opening; there was no sign in front of the hotel; hotel employees 

lacked the required uniforms; many vital operational functions were not in place, 

such as hotel bank accounts; and some rooms were furnished with rented furniture 

not up to Four Seasons’ quality standards. See Id. at 1275. In addition, pertinent 

to the trademark claims, Consorcio’s marketing materials for the residential apartments used Four Seasons’ marks, an unauthorized use, the materials were not approved by Four Seasons, as required by the license, and the materials did not comply with Four Seasons’ quality standards. See Id. at 1309–1310. 

These facts, the court held, provided evidence of actual dilution. The court based 

this finding on the recognized duty and right of trademark licensors to police the 

use of the marks it licenses and the quality of the goods they are used on: ‘‘The 

licensor owes an affirmative duty to the public to assure that in the hands of his 

licensee the trademark continues to represent that which it purports to represent.’’ Id. at 1327 (quoting Siegel v. Chicken Delight, Inc., 448 F.2d 43, 51 (9th Cir. 1971)). 

Accordingly, as Professor McCarthy concludes, a trademark licensor has an affirmative duty under the Lanham Act ‘‘to control the quality of goods and services which 

reach buyers under the licensed mark.’’ Id., citing 2 McCarthy on Trademarks, § 18:50 (4th ed. 2003). Moreover, ‘‘’[d]istribution of a product that does not meet the 

trademark holder’s quality control standards may result in the devaluation of the 

mark by tarnishing its image.’ ’’ Id. at 1328 (quoting Warner-Lambert Co. v. Northside Dev. Corp., 86 F.3d 3, 6 (2d Cir. 1996)). 

Consorcio did not maintain Four Seasons quality standards, leading to a likelihood of consumer confusion ‘‘as to Four Seasons’ approval of such use...’’ Id. at 

1330. In addition to infringement, the court held that these facts supported a finding of dilution: ‘‘Consorcio’s failure to comply with the quality control standards of 

the License Agreement diminished the capacity of the mark to distinguish the high 

quality of Plaintiffs’ services.’’ Id. at 1332. In addition, consumer complaints that the 

Caracas hotel ‘‘’wasn’t a Four Seasons’ due to its substandard nature, incomplete 

construction and inferior furnishings and finishings’’ constituted ‘‘evidence of actual 

harm’’ sufficient to establish dilution. Id.

Again, as in several of the post-Moseley decisions, this case concerned identical 

marks, although, perhaps because the context was that of licensor-licensee, the 

court made no particular note of the identity factor. However, the Court did appear 

to side with the ‘‘additional-circumstantial-evidence’’ school. The ‘‘plus’’ factors here 

were the licensee’s failure to comply with the licensor’s express quality control 

standards and the use of the mark on substandard, inferior services. In a footnote, 

the court suggested that the focus of the inquiry was whether customers ‘‘form 

a‘different impression’ of the goods or services of the senior user.’’ Id. at 1332, n. 

8 (citing Moseley, 123 S.Ct. at 1124). This was how this court seemed to understand 

Moseley’s rejection of the sufficiency of ‘‘mental association’’ between the disputed 

marks to support a finding of dilution under the Federal Trademark Dilution Act 

(‘‘FTDA’’). 

Pinehurst, Inc. v. Wick, 256 F.Supp.2d 424 (M.D.N.C. 2003): This was a classic 

cybersquatting case, with the court also finding actual dilution. In 1999, defendants 

registered 3,000 to 4,000 domain names that were confusingly similar to some of 

the most famous marks in America, including those of about 7% of Fortune 500 company names. See Wick, 256 F.Supp.2d at 426. Defendants then sold a number of 

their registered domain names to companies that contacted them requesting to purchase the company’s domain name. Id. Plaintiff, owner of the famous Pinehurst Golf 

Resort and Pinehurst No. 2 golf course, instead sued defendants over their registration of the domain names ‘‘PinehurstResort.com’’ and ‘‘PinehurstResorts.com’’ under 

the Anticybersquatting Consumer Protection Act (‘‘ACPA’’), 15 U.S.C. section 

1125(d), and the FTDA, 15 U.S.C. section 1125(c). See id. at 426–427. Pinehurst prevailed on both claims and obtained a permanent injunction and statutory damages 

in the amount of $100,000, plus attorneys’ fees and costs. See id. at 433. 

Although the Variety Wholesalers court relied on this decision in support of its 

conclusion that identity of the disputed marks established dilution, see 274 

F.Supp.2d at 1372, Wick is better characterized as an ‘‘identity plus’’ decision, as 

Judge Scheindlin noted in Savin Group, 2003 WL 22451731 at *14. The plus factor 
21

in Wick arose from the unique role trademarks serve in Internet domain names: ‘‘A 

customer using the Internet will be unable to discern any appreciable difference between Defendants’ domain names and Plaintiff’s marks,’’ id. at 432, which reduced 

the value of that mark in two ways: Wick’s registration of Pinehurst’s marks as domain names prevented Pinehurst from engaging in electronic commerce using its 

own marks. See Wick, 256 F.Suppp.2d at 431. In addition, the economic value of 

Pinehurst’s marks was reduced because customers, unable to locate Pinehurst’s 

website and services using domain names identical to its registered marks, ‘‘’may 

fail to continue to search for [P]laintiff’s own home page due to anger, frustration, 

or the belief that [P]laintiff’s home page does note exist.’ ’’ Id. (quoting PETA v. 

Doughney, 263 F.3d 359, 365 (4th Cir. 2001)). The Wick court’s reasoning gives holders of famous marks battling cybersquatters persuasive arguments in support of 

finding trademark dilution under the FTDA in addition to stating claims under the 

ACPA. Nevertheless, the status of these arguments is questionable at best. The 

Wick court relied heavily on Panavision Int’l. L.P. v. Toeppen, 141 F.3d 1316 (9th 

Cir. 1998). Thus, the uncertainty caused by the Moseley decision has left some 

courts relying on questionable and outdated precedents. 

Golden West Financial v. WMA Mortgage Services, No. C 02–05727 CRB, 2003 WL 

1343019 (N.D.Cal. March 13, 2003): In contrast, Judge Breyer in this case found no 

dilution, in part because plaintiffs could not prove that defendants’ use of nearly 

identical marks had or would prevent any customers from succeeding in contacting 

them. See Golden West Financial, 2003 WL 1343019 at *8. In dispute were plaintiffs’ ‘‘World Savings and Loan,’’ ‘‘World Mortgage’’ and related marks for financial 

services allegedly infringed and diluted by defendants’ ‘‘World Lending Group’’ service mark for financial services. Id. at *1. Even were plaintiffs’ marks famous, which 

the court found they were not, there was no evidence in the case that defendants’

use of its ‘‘World’’ mark had diluted plaintiffs’ marks. See id. at *8. To the contrary, 

the court noted, plaintiffs in 2002 had nearly $65 million in assets and its profits 

were a record. Id. In addition, unlike in the Ninth Circuit’s seminal cybersquatting 

decision, Panavision Int’l, L.P. v. Toeppen, 141 F.3d 1316, 1327 (9th Cir. 1998), ‘‘the 

use of the term‘World’ in defendants’ company names has not decreased the value 

of plaintiffs’ trademark because plaintiffs’ customers can easily recognize and contact them.’’ Id.

D. Divergence Between TTAB And Case Law Precedent 

The Trademark Trial and Appeal Board recently held that the likelihood of dilution standard still applies to such applications rather than the actual-dilution standard. See The Nasdaq Stock Market, Inc. v. Antartica, S.R.L., Opposition No. 

91121204 to Application Serial No. 75/546,122, 2003 WL 22021943, *19–*23 (TTAB 

June 30, 2003). Thus, the Moseley decision has created a split in the way the FTDA 

is applied. Federal courts use the actual dilution standard while the TTAB arguably 

still uses the likelihood of dilution standard. Uniformity in application is necessary 

for the healthy development of the law and to allow for predictability and certainty. 

E. A Likelihood Of Dilution Standard Is Consistent With The First Amendment 

Courts have been successfully accommodating First Amendment concerns within 

the Lanham Act. See, e.g., Mattel, Inc., v. Walking Mountain Productions, 2003 WL 

23018285 (9th Cir. Dec. 29, 2003) (finding defendant’s expressive commercial use 

protected after balancing the Lanham Act and the First Amendment). See generally 

Kournikova v. General Media Communications Inc., 278 F.Supp.2d 1111, 1128 (C.D. 

Cal. 2003) (noting that ‘‘Courts have placed limits on Lanham Act lawsuits because 

of the potential impact on First Amendment rights’’). Thus, any concern about encroaching on free speech rights is historically unsupported. 

Moreover, the FTDA explicitly provides for several exceptions to liability that alleviate potential tension with the First Amendment: ‘‘(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.’’ 15 

U.S.C. § 1125(c)(4). In applying these exceptions, courts have construed the ‘‘noncommercial use’’ provision broadly to ensure no First Amendment problems. See, 

e.g., Mattel, Inc. v. MCA Records, 293 F.3d 894 (9th Cir. 2002) (holding that a music 

group’s song that lampooned toy manufacturer’s doll fell under non commercial use 

exception in FTDA). In addition, commercial speech is protected by the First 

Amendment and thus a court could not avoid a First Amendment analysis. See, e.g., 

Virginia Board of Pharmacy v. Virginia Citizens Consumer Counsel, 425 U.S. 765 

(1976). 
22

There is no reason to believe that including a likelihood standard significantly 

changes the approach courts will take in balancing First Amendment concerns, the 

likelihood standard has dominated state law dilution statutes for decades. The 1964 

United States Trademark Association Model State Trademark Bill establishes liability for ‘‘[l]ikelihood of injury to business reputation or of dilution of the distinctive 

quality of the mark.’’ This standard has not led to a progressive encroachment on 

free speech rights. See, e.g., L.L. Bean, Inc. v. Drake Publishers, Inc., 811 F.2d 26 

(1st Cir. 1987) (holding that the state law likelihood of dilution statute could not 

be applied to prohibit a tarnishing parody because doing so would offend the First 

Amendment). 

F. Conclusion 

Amending the FTDA to incorporate a likelihood of dilution standard will solve a 

host of problems created by the Moseley decision. If the status quo remains, the 

FTDA will not be an effective means of protecting famous marks. 

II. TARNISHMENT IN THE FTDA

The FTDA should be amended to include a specific cause of action for tarnishment 

because the Supreme Court in Moseley cast doubt on its existence in the FTDA even 

though the legislative history for the Act indicates Congress intended for there to 

be one and other case law recognized the cause of action. 

A. FTDA Legislative History Refers To Tarnishment 

The Supreme Court in Moseley provided the following concise summary of the legislative effort leading to the passage of the FTDA and the intent that the FTDA 

cover tarnishment:

On July 19, 1995, the Subcommittee on Courts and Intellectual Property of the 

House Judiciary Committee held a 1-day hearing on H.R. 1295. No opposition 

to the bill was voiced at the hearing and, with one minor amendment that extended protection to unregistered as well as registered marks, the subcommittee 

endorsed the bill and it passed the House unanimously. The committee’s report 

stated that the ‘‘purpose of H.R. 1295 is to protect famous trademarks from subsequent uses that blur the distinctiveness of the mark or tarnish or disparage 

it, even in the absence of a likelihood of confusion.’’ H.R. Rep. No. 104–374, p. 

1029 (1995). As examples of dilution, it stated that ‘‘the use of DUPONT shoes, 

BUICK aspirin, and KODAK pianos would be actionable under this legislation.’’

Id. at 1030. In the Senate an identical bill, S. 1513, 104th Cong., 1st Sess., was 

introduced on December 29, 1995, and passed on the same day by voice vote 

without any hearings. In his explanation of the bill, Senator Hatch also stated 

that it was intended ‘‘to protect famous trademarks from subsequent uses that 

blur the distinctiveness of the mark or tarnish or disparage it,’’ and referred to 

the Dupont Shoes, Buick aspirin, and Kodak piano examples, as well as to the 

Schechter law review article. 141 Cong. Rec. 38559–38561 (1995).

Moseley, 123 S. Ct. at 1123 (emphasis added). 

Despite these statements that the legislation was intended to cover tarnishment 

claims, the Court was not persuaded that the statutory language accomplished this 

purpose because the statute did not include specific language regarding 

tarnishment, such as ‘‘injury to business reputation.’’ Thus the Court wrote:

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.

Moseley, 123 S. Ct. at 1124. In his concurrence in this case, however, Justice Kennedy viewed the statute as encompassing both blurring and tarnishment. See id. at 

1126; See also Pattishall, Hilliard and Welch, Trademarks and Unfair Competition 

Deskbook § 8.01[2][b] (2d ed. 2003). 

The primary legislative history of the 1995 Act is House Report 104–374. The language the Supreme Court quoted from that report is probably the best language in 

support of the proposition that Congress intended the FTDA to cover dilution by 

tarnishment. Additional support is found in the ‘‘section by section analysis’’ of the 

proposed bill, which states that the definition of dilution ‘‘is designed to encompass 

all forms of dilution recognized by the courts, including dilution by blurring, by 

tarnishment and by disparagement.) H. R. Rep. No. 104–374 at page 8 (emphasis 

added). 

Another potential source of legislative history is the testimony taken by the Subcommittee on Courts and Intellectual Property on July 19, 1995. The House Report 
23

recites the fact the Committee received the testimony and the identity of the witnesses, but the substance of that testimony is not part of the actual Report. See Id.

at p. 5. Still, that testimony itself provides a nearly unanimous view that the proposed law would cover both blurring and tarnishment. See, e.g., Testimony of Mary 

Ann Alford, the Executive Vice President of INTA (‘‘This definition [of dilution in 

the proposed statute] encompasses both dilution by blurring and dilution by 

tarnishment. It is also elastic enough to encompass future, currently unforeseen, 

factual situations that may give rise to liability.’’) But see Testimony of Jonathan 

E. Moskin (‘‘H.R. 1295 does not purport to recognize injury from uses of a famous 

trademark that are likely to tarnish the reputation of the owner of famous mark. 

This is one form of injury that has been susceptible of proof under state dilution 

laws independent of proof of likelihood of confusion.’’) 

In sum, the 1995 legislative history of the FTDA supports the conclusion that 

Congress intended that statute to cover dilution by tarnishment. The Supreme 

Court has raised doubts about whether the statutory language accomplishes this 

purpose. 

B. Case Law After The Enactment Of The FTDA Recognized The Existence 

Of A Specific Cause Of Action For Tarnishment In The Act 

After the enactment of the FTDA and prior to the Moseley decision, courts ‘‘have 

construed the federal dilution statute to protect against dilution by tarnishment.’’

Pattishall, Hilliard, and Welch, Trademarks and Unfair Competition Deskbook

§ 8.01[2][c] (2d ed. 2003); See also Clinique Labs. v. Dep Corp., Inc., 945 F. Supp. 

547, 560–62 (S.D.N.Y. 1996)(Recognizing a cause of action for tarnishment under 

the FTDA, while holding that defendant’s BASIQUE skin care products did not tarnish plaintiff’s CLINIQUE skin care products); Dr. Seuss, Enter. v. Penguin Books 

USA, Inc., 924 F. Supp. 1559, 1573 (S.D. Cal. 1996), aff’d, 109 F.3d 1394 (9th Cir.), 

cert. Dismissed, 521 U.S. 1146 (1997) (‘‘The legislative history supports the conclusion that Congress also intended the Act to cover dilution through tarnishment’’); 

Anheuser-Busch v. Andy’s Sportswear, 40 U.S.P.Q.2d 1542 (N.D. Cal. 

1996)(BUTTWISER t-shirt dilutes BUDWEISER mark for beer; TRO granted in context which makes tarnishment the basis for decision); Ringling Bros.-Barnum & 

Bailey Combined Shows v. B.E. Windows Corp., 937 F. Supp. 204, 211(S.D.N.Y. 

1996)(Recognizing a cause of action for tarnishment under the FTDA, but finding 

that defendant’s GREATEST BAR ON EARTH services mark for a night club did 

not tarnish the ‘‘wholesome, family oriented image of [plaintiff’s ] GREATEST 

SHOW ON EARTH’’ mark under the Dilution Act, noting alcohol was served at 

venues where plaintiff’s circus performed). 

C. Since The Moseley Decision, At Least One Court Has Raised Doubts 

About The Viability Of Tarnishment Under The FTDA 

Since the Supreme Court issued its Moseley decision on March 4, 2003, no case 

squarely has addressed the question of whether the FTDA covers dilution by 

tarnishment, but one opinion specifically notes the doubts raised by Moseley on this 

point. 

In Caterpillar Inc. v. Walt Disney Co., 287 F. Supp. 2d 913, 922 (C.D. Ill. 2003), 

the trial court denied plaintiff’s request for a temporary restraining order in connection with defendant’s use of Caterpillar bulldozers in the movie ‘‘George of the Jungle 2’’ in a manner plaintiff found offensive. Plaintiff alleged several claims, including a dilution by tarnishment claim under the FTDA. In connection with its decision, the court noted the question raised by Moseley of ‘‘whether tarnishment is 

within the scope of § 43c.’’ The Caterpillar court, however, did not decide that issue, 

instead addressing the issue of what Caterpillar was required to prove to show ‘‘actual dilution.’’ Because of the Moseley decision, courts, such as the one in Caterpillar, will continue to raise questions about the viability of a cause of action for 

tarnishment under the FTDA. Cf., The NASDAQ Stock Market, Inc. v. Antarctica,

s.r.l., 2003 TTAB LEXIS 391, *67 (citing Moseley, noting: ‘‘state dilution statutes 

provide that tarnishment and blurring are actionable, while FTDA arguably refers 

only to the latter’’). 

C. Conclusion 

We believe that Congress intended to include dilution by tarnishment as well as 

dilution by blurring in the FTDA, and the Act effectively did so. However, dicta in 

the Moseley decision has raised doubts and created uncertainty in this regard. The 

Section of Intellectual Property Law of the American Bar Association supports removal of this uncertainly by an amendment to the FTDA to expressly include a 

cause of action for dilution by tarnishment. 
24

III. FTDA AND ACQUIRED DISTINCTIVENESS

The Federal Trademark Dilution Act should be amended to state that marks that 

have acquired distinctiveness from use in the marketplace are eligible for dilution 

protection under the Trademark Act to the same extent as marks that are inherently distinctive. 

The FTDA provides that one of the factors for determining whether a mark is sufficiently ‘‘distinctive and famous’’ to be covered by the Act is ‘‘the degree of inherent 

or acquired distinctiveness of the mark.’’ 15 U.S.C. § 1125 (c)(i)(A). There is currently a split among the Circuits regarding whether a mark is required to be inherently distinctive to receive protection under the FTDA. Based on an analysis of the 

case law and the intent behind the FTDA, marks which have merely acquired distinctiveness should be eligible for dilution protection. Some of the most famous 

marks in the world are famous but arguably not inherently distinctive, such as 

FORD, DELL, and DUPONT. These should be protected under the FTDA. Therefore, the FTDA should be amended to make this clear and resolve the divergence 

in authority among the Circuit courts. 

A. Cases Requiring Inherent Distinctiveness 

Second Circuit 

In TCPIP Holding Company, Inc. v. Haar Communications, Inc., 244 F.3d 88 (2nd 

Cir. 2001), the Court of Appeals vacated the lower court’s ruling that preliminarily 

enjoined the defendant from using any Internet domain names with the mark THE 

CHILDREN’S PLACE to the extent the ruling was based on the FTDA, but affirmed 

it to the extent the ruling was based on any likelihood of confusion. The court stated 

that given the history of the FTDA, ‘‘we conclude that a descriptive mark does not 

come within the protection of the’’ FTDA. Id. at 93. The court, in interpreting FTDA 

in a harmonious way with its result, stated that it understood the FTDA ‘‘to invite 

two inquiries: (1) Has the plaintiff’s mark achieved a sufficient degree of consumer 

recognition (‘‘acquired distinctiveness’’) to satisfy the Act’s requirement of fame? (2) 

Does the mark possess a sufficient degree of‘inherent distinctiveness’ to satisfy the 

Act’s requirement of‘distinctive quality.’ The latter requirement cannot be satisfied 

by the mere fact that the public has come to associate the mark with the source.’’

Id. at 98. The court reasoned that in order for a mark to be famous, it must acquire 

some form of distinctiveness, therefore if the criterion of distinctiveness was satisfied by the acquired distinctiveness of the mark, it would render the criterion of 

fame meaningless. Therefore, only inherently distinctive marks qualify for protection under the FTDA. 

In Deere & Company v. MTD Holdings Inc., No. 00 Civ. 5936(LMM), 2003 WL 

22439778 (S.D.N.Y., October 28, 2003), Deere & Company sought to amend its complaint regarding a FTDA claim after the district court had granted MTD Holdings’

motion for dismissal under the Qualitex doctrine that color marks require secondary 

meaning. Deere attempted to claim that its specific use of the color green on the 

body of its products and yellow for trim was arbitrary. The court rejected this notion 

and found that the use of two colors still requires proof of secondary meaning for 

protection. The court dismissed the dilution claim because the colors yellow and 

green are not inherently distinctive and, citing the TCPIP case, do not qualify for 

protection under the FTDA. 

Malaco Leaf, AB v. Promotion In Motion, Inc., 287 F. Supp. 2d 355 (S.D.N.Y. 

2003): Malaco Leaf brought suit for alleged copying of its fish-shaped gummy candy 

known as the ‘‘Swedish Fish.’’ The court held that inherent distinctiveness was required under FTDA, and since product configuration can never be inherently distinctive under the Sumara Bros. case, defendant was entitled to summary judgment 

on plaintiff’s FTDA claim. 

Christopher D. Smithers Foundation, Inc. v. St. Luke’s-Roosevelt Hosp. Center, No. 

00 Civ. 5502(WHP), 2003 WL 115234 (S.D.N.Y., Jan 13, 2003): The Foundation filed 

an action regarding its marks THE CHRISTOPHER D. SMITHERS FOUNDATION, 

INC., THE CHRISTOPHER D. SMITHERS FOUNDATION, THE SMITHERS 

FOUNDATION, C.D. SMITHERS FOUNDATION, and 

SMITHERSFOUNDATION.ORG. The Hospital operated the Smithers Alcoholism 

Treatment and Training Center. Among the Foundation’s claims was one under the 

FTDA. In dismissing the FTDA claim, the court noted that the term ‘‘foundation’’

and the surname ‘‘Smithers’’ are descriptive and, citing TCPIP, that such descriptive 

marks do qualify for protection under the FTDA as such terms are not inherently 

distinctive. ‘‘The FTDA differs from traditional trademark law in that it protects 

a‘far narrower’ class of entities. The FTDA only affords protection to inherently distinct marks (i.e. suggestive, arbitrary, fanciful), and does not afford protection to descriptive marks that have acquired distinctiveness. Thus, the evidence of secondary 
25

meaning submitted by the Foundation could not save its FTDA claim.’’ Id. at *7 (citations omitted.) 

Solow Building Company, LLC v. Nine West Group, Inc., No. 01–7878, 2002 WL 

31303237 (2nd Cir. October 11, 2002): In affirming the district court’s dismissal of 

plaintiff’s complaint, the court held ‘‘that Solow’s federal trademark dilution claims 

are also barred on the alternative ground that Solow’s mark lacks inherent distinctiveness. Solow has conceded that its mark is descriptive at best, and this court has 

held that such a mark lacks sufficient distinctiveness to warrant protection under 

the federal trademark dilution statute.’’ Id. at *1. Plaintiff’s mark was a red numeral ‘‘9’’ which was nicknamed 9 WEST and defendant’s mark was ‘‘NINE WEST.’’ New York Stock Exchange, Inc. v. New York, New York Hotel, LLC, 293 F.3d 550 

(2nd Cir. 2002): The Second Circuit affirmed the lower court’s dismissal of all but 

one of plaintiff’s claims for protection under the FTDA because the marks, except 

for one, were not inherently distinctive. Defendant had modified several of the many 

registered marks of plaintiff. Examples of the modified marks include: (i) a replica 

of NYSE’s architectural facade that bore the words ‘‘NEW YORK NEW YORK SLOT 

EXCHANGE’’ located near the Defendant’s gambling floor; (ii) the Defendant’s ‘‘NEW YORK SLOT EXCHANGE’’ or ‘‘NEW YORK-NEW YORK SLOT EXCHANGE’’ club for frequent gamblers; (iii) sweatshirts, caps, and other souvenirs 

given out by the Defendant to the members of its players club displaying the ‘‘NEW 

YORK SLOT EXCHANGE’’ or ‘‘NEW YORK-NEW YORK SLOT EXCHANGE’’ slogan; and (iv) the Defendant’s reference to its players club by the ‘‘NY’’ or ‘‘NY-NY’’ abbreviation. The exception is a registered logo consisting of Plaintiff’s building’s facade bearing the words ‘‘NEW YORK STOCK EXCHANGE.’’ The court followed its 

decision in TCPIP and noted that a trier of fact might find the excepted mark inherently distinctive, which would then qualify it for FTDA protection. 

GTFM, Inc. v. Solid Clothing, Inc., 215 F. Supp. 2d 273 (S.D.N.Y. 2002): GTFM, 

Inc. filed an action based on its marks ‘‘FUBU,’’ ‘‘FUBU 05’’ and ‘‘05’’ for clothing. 

Solid Clothing, Inc. had adopted the marks ‘‘05’’ and then ‘‘PLAYERS 05’’ on sports 

apparel it designed to imitate GTFM’s marks. In dismissing the FTDA claim, the 

district court cited TCPIP and held that GTFM’s marks were not inherently distinctive and did not qualify for protection under the FTDA. Id. at 299–300. The court 

also went on to say that the ‘‘05’’ mark was not famous either. 

Cline v. 1–888–Plumbing Group, Inc. 146 F. Supp. 2d 351 (S.D.N.Y. 2001): Plaintiff claimed that its mark 1–800–PLUMBING was being diluted by defendant’s mark of 1–888–PLUMBING. The district court cited TCPIP and denied plaintiff’s motion for summary judgment regarding its FTDA claim because plaintiff’s mark 

was descriptive and therefore lacked the inherent distinctiveness required for protection under the FTDA. Id. at 361. 

B. Cases Not Requiring Inherent Distinctiveness 

First Circuit 

I.P. Lund Trading v. Kohler Co., 163 F.3d 27 (1st Cir. 1998). A faucet manufacturer brought an action against competitors for dilution and infringement of manufacturer’s trade dress. In holding that Plaintiff’s faucet design was not so famous 

as to warrant protection under the FTDA, the court noted, ‘‘There is little to suggest 

that this product design, itself unregistered and not inherently distinctive, is so 

strong a mark and so well publicized and known that it has achieved the level of 

fame Congress intended under the’’ FTDA. Id. at 60. The court bifurcated the analysis of a mark under the FTDA, holding a mark must be distinctive and famous 

to qualify for protection under the FTDA. The court found that a mark may be inherently distinctive or acquire sufficient distinctiveness to satisfy the requirement 

of distinctiveness. Id. at 58–60. The mark must also be famous to qualify for protection under the FTDA, and inquiry regarding whether or not a mark is famous is 

a separate inquiry. 

Third Circuit 

Times Mirror Magazines, Inc. v Las Vegas Sport News, LLC, 212 F.3d 157 (3rd 

Cir. 2000): The Third Circuit affirmed the lower court’s grant of a preliminary injunction under the FTDA to Time Mirror Magazines, Inc. owner of the mark THE 

SPORTING NEWS preventing Las Vegas Sport News, LLC from using the mark 

LAS VEGAS SPORTING NEWS. The court held that the mark ‘‘THE SPORTING 

NEWS’’ was not inherently distinctive. Therefore, the court must ‘‘examine the degree to which the mark has acquired distinctiveness by gaining secondary meaning 

over time in the marketplace.’’ Id. at 166. This includes the following considerations: 

‘‘(1) the length or exclusivity of use of the mark; (2) the size or prominence of the 

plaintiff’s enterprise; (3) the existence of substantial advertising by the plaintiff; (4) 

established place in the market and (5) proof of intentional copying.’’ Id. The court 
26

found the mark had acquired sufficient distinctiveness to warrant protection under 

the FTDA. 

Sixth Circuit 

Libbey Glass, Inc. v. Oneida Ltd., 61 F. Supp. 2d 700 (N.D. Ohio 1999): Plaintiff 

filed, among other claims, a claim for violation of FTDA based on defendants manufacture and sale of ‘‘knock-off’’ beverage glassware. In rejecting plaintiff’s motion for 

summary judgment, the court stated in addressing the requirement of distinctiveness that ‘‘Libbey’s trade dress is not inherently distinctive and there is a genuine 

issue of material fact about whether Libbey’s trade dress has secondary meaning.’’

Id. at 716. This clearly implies that acquired distinctiveness is sufficient. 

Seventh Circuit 

AM General Corp. v. DaimlerChrysler Corp. 311 F.3d 796 (7th Cir. 2002): Plaintiff 

asserted trademark infringement and FTDA claims based upon an asserted family 

of marks in its Jeep grille designs. The court recognized that under Traffix, product 

configurations must acquire distinctiveness and secondary meaning to be 

protectable. The court did not reject the FTDA claim on grounds that the alleged 

family of marks was not inherently distinctive, but rather denied a preliminary injunction on the FTDA claim because the plaintiff had failed to prove that it had 

rights in the family of marks it was asserting. As a result, the marks being asserted 

certainly could not be famous. Id. at 818. This suggests that the Seventh Circuit 

takes the position that acquired distinctiveness is sufficient for a FTDA claim. Otherwise the court would have stopped when it concluded that the marks were not 

inherently descriptive. 

Ty Inc. v. Perryman, 306 F.3d 509 (7th Cir. 2002), cert. Denied, 123 S. Ct. 1750 

(2003): The mark at issue in this case was BEANIES. The court found that the 

mark clearly was not inherently distinctive. See Id. at 513. The court did not reject 

the FTDA claim on this basis. Rather, the court held that an injunction was proper 

under the FTDA claim but only that its scope should be much more limited than 

originally ruled by the district court. Thus, in this case, the Seventh Circuit allowed 

an FTDA claim with a mark that it clearly held to not be inherently distinctive. 

Ninth Circuit 

Adidas-Salomon AG v. Target Corp., No. CV–01–1582–ST, 2002 WL 31971831 (D. 

Or. July 31, 2002): Plaintiff filed an action regarding its three stripe mark and 

Original Superstar trade dress which is for a particular style of shoe. Defendant had 

adopted a four stripe mark and similar style of shoe. The magistrate’s findings 

noted there was a split in the Circuits regarding the whether or not a mark with 

acquired distinctiveness qualifies for protection under the FTDA and, relying on language from Avery Dennison v. Sumpton (see summary below), concluded that, in the 

Ninth Circuit, acquired distinctiveness does qualify. Under the Ninth Circuit standard, the court held that there was sufficient evidence that the three stripe mark and 

Original Superstar trade dress where distinct and famous to withstand defendant’s 

motion for summary judgment. 

Thane International, Inc. v. TREK Bicycle Corporation, 305 F.3d 894 (9th Cir. 

2001): The Ninth Circuit reversed the lower court’s grant of summary judgment to 

the defendant because it improperly used a likelihood of confusion standard. The 

court focused on the failure of Trek Bicycle to show its mark TREK was famous; 

the court mingled the requirement of fame with the requirement of distinctiveness. 

In a footnote, the court stated ‘‘a mark must have a relatively high degree of distinctiveness both to‘be capable of being diluted’ and to meet § 1125(c)(1)’s‘threshold element of fame.’ A party may satisfy this burden with a showing of acquired distinctiveness, rather than inherent distinctiveness, but in either case it must 

demonstrate‘a degree of distinctiveness beyond that needed to serve as a trademark.’ ’’ Id. at 912 n.14 (citations omitted). 

Cairns v. Franklin Mint Co., 24 F. Supp. 2d 1013 (C.D. Cal. 1998), aff’d, 1999 U.S. 

App. LEXIS 34568 (9th Cir. 1999): The executors of the Estate of Diana, Princess 

of Wales, and trustees of her memorial fund sued sellers of Princess Diana memorabilia. In rejecting the defendant’s motion to dismiss the FTDA claim, the court noted 

that a surname is not inherently distinctive. ‘‘Thus, to state a claim under the Federal Trademark Dilution Act for service mark infringement, a plaintiff must allege 

that the personal name asserted as a mark has acquired secondary meaning such 

that the name is synonymous in the public mind with the service provided by the 

plaintiff.’’ Id. at 1034. Later, the court reached the same conclusion and then granted the defendant’s motion for summary judgment on the FTDA claim on the basis 

that secondary meaning was not established. See, 107 F. Supp. 2d 1212, 1222 

(C.D.Cal. 2000). 
27

Avery Dennison Corp. v. Sumpton, 189 F.3d 868 (9th Cir. 1999): The owner of the 

marks ‘‘Avery’’ and ‘‘Dennison’’ for office products brought action against an Internet 

e-mail provider and its president, for registering ‘‘avery.net’’ and ‘‘dennison.net’’ as Internet domain names and licensing them as e-mail addresses. In reversing a grant 

of summary judgment for the owner of the marks, the court rejected the ‘‘argument 

that the distinctiveness required for famousness under the Federal Trademark Dilution Act is inherent, not merely acquired distinctiveness. However, because famousness requires a showing greater than mere distinctiveness, the presumptive secondary meaning associated with ‘‘Avery’’ and ‘‘Dennison’’ fails to persuade us that 

the famousness prong is met in this case.’’ Id. at 877. (citations omitted) 

Star Markets, Ltd. v. Texaco, Inc., 950 F. Supp. 1030 (D.Hawaii 1996): In this 

case, the court granted the defendant summary judgment on the plaintiff’s FTDA 

claim because, while the mark had acquired distinctiveness, it was not famous, even 

though a survey had showed that 75% of the respondents associated the STAR 

trademark with the plaintiff’s grocery stores. The court stated: ‘‘Acquired distinctiveness is merely a minimum threshold for establishing protectability of a trademark that is not suggestive, arbitrary or fanciful. Once established, the [FTDA] 

compels the court to consider the degree of that distinctiveness as one of many factors for determining whether the mark is famous.’’ Id. at 1033. 

Eleventh Circuit 

Carnival Corp. v. SeaEscape Casino Cruises, Inc. 74 F. Supp. 2d 1261 (S.D.Fla. 

1999): Plaintiff brought claims based upon its trademark FUN SHIP. The court 

clearly found that the mark was descriptive, but had acquired secondary meaning. 

The court did not reject the plaintiff’s FTDA claim on this basis. Rather, the court 

found that while the mark had acquired distinctiveness, it had not acquired sufficient fame to support an FTDA claim. 

C. Other Cases with Comments Relevant to the Issue 

Supreme Court 

Moseley v. V Secret Catalogue, Inc., 123 S. Ct. 1115 (2003): Plaintiff is the owner 

of the mark VICTORIA’S SECRET. Plaintiff brought suit against petitioners who 

opened a store named VICTOR’S SECRET and then changed the name, after being 

contacted by Plaintiff, to VICTOR’S LITTLE SECRET. The narrow issue on certiorari was whether objective proof of actual injury to the economic value of a famous 

mark is required for relief under the FTDA. The Supreme Court did not reach the 

issue of distinctiveness, but, in a footnote, quoted Nabisco, Inc. v. PF Brands, Inc.:

‘‘[i]t is quite clear that the statute intends distinctiveness, in addition to fame, as 

an essential element. The operative language defining the tort requires that‘the 

[junior] person’s . . . use . . . cause dilution of the distinctive quality of the [senior] 

mark.’ 15 U.S.C. § 1125(c)(1). There can be no dilution of a mark’s distinctive quality 

unless the mark is distinctive.’’ Moseley, 123 S. Ct. at 1120 n.5. Some have argued 

that this is an endorsement of the notion that inherent distinctiveness is required. 

Professor J. Thomas McCarthy, however, strongly disagrees with this position. See, 

4 McCarthy on Trademarks and Unfair Competition § 24:91 to 24:91.2. 

Second Circuit 

Sporty’s Farm L.L.C. v. Sportsman’s Market, Inc., 202 F.3d 489 (2nd Cir. 2000): 

In deciding whether or not the mark SPORTY’S was distinctive for the purpose of 

the FTDA, the Second Circuit stated, ‘‘Distinctiveness refers to inherent qualities of 

a mark and is a completely different concept from fame. A mark may be distinctive 

before it has been used—when its fame is nonexistent. By the same token, even a 

famous mark may be so ordinary, or descriptive as to be notable for its lack of distinctiveness.’’ Id. at 497 (emphasis added). 

Nabisco, Inc. v. PF Brands, Inc., 191 F.3d 208 (2nd Cir. 1999): The Second Circuit 

affirmed the lower court’s order entering a preliminary injunction against Nabisco 

using a mark consisting of an orange, bit-sized, cheddar cheese flavored, fish-shaped 

cracker because it would dilute Pepperidge Farm’s mark for its goldfish-shaped 

cracker. The court noted that ‘‘[t]he first of [the distinctiveness and famous] factors 

invites the court to consider‘the degree of inherent or acquired distinctiveness of the 

mark.’ ’’ Id. at 215. The court found the Pepperidge Farm’s goldfish cracker exhibits 

a moderate degree of distinctiveness and qualified it for protection under the FTDA. 

BigStar Entertainment, Inc. v. Next Big Star, Inc. 105 F. Supp. 2d 185 (S.D.N.Y. 

2000): Plaintiff sold motion picture videos and provided information regarding films 

and stars on the Internet using the marks BIGSTAR and BIGSTAR.COM. Plaintiff 

brought a trademark infringement and dilution action, with related state law 

claims, against a company conducting talent searches on the Internet using the 

marks NEXT BIG STAR and NEXTBIGSTAR.COM. In rejecting plaintiff’s FTDA 
28

claim, the court noted that plaintiff’s marks were composed of descriptive terms and 

relatively weak. While the court did not say that inherent distinctiveness was required under FTDA, it did conclude the marks did not qualify for protection under 

the FTDA because they did not have the requisite ‘‘distinctiveness.’’

Sixth Circuit 

Ford Motor Co. v. Lloyd Design Corp., 184 F. Supp. 2d 665 (E.D. Mich. 2002): 

Ford brought suit against the manufacturer of floor mats for use with Ford’s vehicles that use Ford’s marks without its authorization. In upholding the magistrate’s preliminary injunction recommendation, based in part on a claim under the FTDA, 

the district court followed the Nabisco case and found:

that the marks F–150, F–250 and F–350 are fanciful and, thus, of high distinction. The trademark Aston Martin is also highly distinctive because, even 

though it is not purely fanciful, the name is unlikely to signify anything in commerce but the automobiles and accessories bearing the name. Since Ford, Jag- uar, Lincoln, Mercury, Mustang, Bronco, Taurus, Windstar, Excursion, Expedition, Navigator, Moutaineer, and Thunderbird are not purely 

fanciful, but are names that are unrelated in everyday life to automobiles, the 

court finds them to enjoy a moderate degree of distinctiveness. Therefore, Plaintiffs have established the second element of an FTDA claim. Hence, the only 

remaining factor is the fifth: whether Defendant’s use may cause dilution of the 

distinctive quality of the senior mark.

Id. at 679. The court did not address whether inherent distinctiveness was required. 

AutoZone, Inc. v. Tandy Corp. 174 F. Supp. 2d 718 (M.D. Tenn. 2001): AutoZone, 

Inc., brought an action based on its mark AUTOZONE for use in association with 

automotive parts store services against the Tandy Corporation for its use of the 

mark POWERZONE in association with electronics. In ruling that AutoZone did not 

have a viable FTDA claim because the marks were not similar enough, the court 

noted:

distinctiveness plays a dual role in the dilution analysis. First, as noted above, 

it is a statutory element; under the statute, a mark does not receive protection 

unless it is distinctive. Second, . . . the degree of distinctiveness of the senior 

mark will have a considerable bearing on whether the junior use will have a 

diluting effect. The more distinctiveness the mark possesses, the greater is the 

interest to be protected from dilution. For the reasons stated in the distinctiveness analysis above, the Court concludes that, for the purposes of dilution analysis, the AUTOZONE mark exhibits a moderate degree of distinctiveness, entitling it to a commensurate level of protection.

Id. at 736. The court noted (1) that the plaintiff was entitled ‘‘to a presumption that 

its registered trademark is inherently distinctive,’’ (2) that ‘‘analysis using the traditional spectrum approach would lead to the same conclusions,’’ but also (3) that the 

mark had acquired secondary meaning. 

NBBJ East Limited Partnership v. NBBJ Training Academy, Inc., 201 F. Supp. 

2d 800 (S.D. Ohio 2001): An architectural firm brought action against a computer 

training school, alleging infringement and dilution of its mark NBBJ. In granting 

plaintiff an injunction against defendant using the mark NBBJ, the court noted that 

distinctiveness is a required element of dilution and quoted the following passage 

from the Sixth Circuit opinion in the Moseley case (259 F.3d at 469):

Distinctiveness is a crucial trademark concept, which places marks on a ladder 

reflecting their inherent strength or weakness. The degree of distinctiveness of 

a mark governs in part the breadth of protection it can command. At the low 

end are generic words—words that name the species or object to which the 

mark applies. These are totally without distinctiveness and are ineligible for 

protection as marks because to give them protection would be to deprive competitors of the right to refer to their products by name. . . . Thus, no one can 

claim the exclusive right to use the mark ‘‘CAR’’ for a car. One rung up the ladder are ‘‘descriptive’’ marks—those that describe the product or its attributes or 

claims. These also have little distinctiveness and accordingly are ineligible for 

protection unless they have acquired ‘‘secondary meaning’’—this is, unless the 

consuming public has come to associate the mark with the products or unless 

the consuming public has come to associate the mark with the products or services of its user. . . . The next higher rung belongs to ‘‘suggestive’’ marks; these 

fall in an in-between category. . . . They are given less protection than is reserved for more distinctive marks—those that are ‘‘arbitrary’’ or ‘‘fanciful.’’. . . 

A mark is arbitrary or fanciful if there is no logical relationship whatsoever between the mark and the product on which it is used. . . . The most distinctive 
29

2See, e.g., Kenemuth, Lori, ‘‘The Niche Market Manual: A Guide To Understanding The Niche 

Market Theory’’, AIPLA Quarterly Journal, Vol. 32 No. 1, pp. 123–140 (author advocates preserving and applying the niche market theory under the FTDA). 

are marks that are entirely the product of the imagination and evoke no association with the human experience that relate intrinsically to the product. . . . The strongest protection of the trademark laws is reserved for these most highly 

distinctive marks.

NBBJ East Ltd. Partnership, 201 F. Supp. 2d at 806. The court found that NBBJ 

was arbitrary or fanciful. 

Ninth Circuit 

Mattel, Inc. v. MCA Records, Inc., 296 F.3d 894 (9th Cir. 2000): The Ninth Circuit 

affirmed the lower court’s ruling that MCA Records’ use of Mattel, Inc.’s mark 

BARBIE was a parody and nominative fair use. In affirming the lower court’s ruling 

that there was no claim for dilution under the FTDA, the Ninth Circuit noted that 

the mark BARBIE clearly met the requirements of fame and distinctiveness. Id. at 

903. The court also held that MCA Records’ use of the mark was dilutive. Id. However, the court determined that MCA Records’ use of the mark BARBIE fell within 

the scope of the noncommercial use exemption to the FTDA. See id. at 904–07. 

Eleventh Circuit 

Corbitt Manufacturing Co. v. GSO America, Inc., 197 F. Supp. 2d 1368 (S.D. Ga. 

2002): Corbitt brought an action based on its mark ‘‘NO FLOAT’’ for use in association with mulch. Corbitt claimed that GSO’s mark ‘‘NON-FLOATING’’ on their 

packaging of mulch infringed Corbitt’s mark. The court denied the plaintiff’s request 

for preliminary injunction. In addressing Corbitt’s dilution claim, the court held that 

while ‘‘some factors favor Corbitt, it has not shown the requisite level of fame. As 

mentioned above, NO FLOAT is at best a descriptive mark with secondary meaning. 

In fact, it is entitled to this presumption only because of its incontestable status. 

Even after assuming this status applies in the dilution context, there is little evidence of the‘acquired distinctiveness of the mark.’ ’’ Id. at 1378. 

Legal Treatises 

In his treatise, 4 McCarthy on Trademarks and Unfair Competition § 24:91 to 

24:91.2, the esteemed trademark law scholar, Professor J. Thomas McCarthy, finds 

no inherent distinctiveness requirement in the FTDA. In fact, he does not see ‘‘distinctiveness’’ as a separate element from fame. He believes that the distinctiveness 

requirement in the statute only means that the mark must properly qualify as a 

mark, namely that it has inherent or acquired distinctiveness. Otherwise, the term 

would not be a mark at all. 

D. Conclusion 

An analysis of the case law and statute indicates that marks that have acquired 

distinctiveness should be protected under the FTDA. Given the consensus by a majority of Circuits, which is supported by both the text and purpose of the statute, 

the FTDA should be amended to clarify this point. 

IV. NICHE MARKET FAME

The Federal Trademark Dilution Act of 1995 should not be amended at this time 

to state either that marks which are famous within limited geographic areas or commercial market segments are eligible for dilution protection under the Trademark 

Act to the same extent as marks that are famous on a nation-wide basis, or to state 

that such marks are ineligible for dilution protection under the Act. 

There is no clear consensus on the issue of niche fame.2 No steps should be taken 

at this time to address the issue. Rather, the issue should be reevaluated after it 

has been defined further through the case law. Given the controversial nature of 

the niche fame issue, as shown by the divergent case law results below, and given 

that the issue has not been explicitly addressed in the FTDA before, we believe the 

issue of niche fame will be difficult to address through legislative changes. It is this 

controversy that distinguishes the niche fame issue from the acquired distinctiveness position noted above. 

A. The Niche Fame Issue Is Unresolved In The Courts 

There is a split among the Circuit Courts of Appeals on the issue of whether 

‘‘niche market’’ fame satisfies the statutory requirement that marks be famous to 

qualify for protection under the Federal Trademark Dilution Act (‘‘FTDA’’). See 15 

U.S.C. § 1125(c) (extending federal trademark dilution protection to ‘‘owner(s) of a 
30

3 In contrast to the 9th Circuit (see Avery Dennison Corp. v. Sumpton, 189 F.3d 868, 877–878 

(9th Cir. 1999)), the 7th Circuit holds that fame within a limited geographic area is not sufficient for the FTDA. The legislative history of the Act made clear, the 7th Circuit noted, that, 

‘‘in order to be‘famous,’ a mark must be used in a substantial segment of the United States.’’ Syndicate Sales, 192 F.3d at 641, fn. 7. While this meant that marks famous in one local area 

were not entitled to federal dilution protection, fame within a limited commercial segment was 

sufficient when the market within which the commercial activity was occurring was national 

in scope. Id. 4See Syndicate Sales, 192 F.3d at 640, fn. 5, citing, inter alia, Michael Caruso & Co. v. 

Estefan Enters. Inc., 994 F.Supp 1454, 1463; Golden Bear Int’l v. Bear U.S.A., Inc., 969 F.Supp. 

742, 749 (N.D.Ga. 1996); King of the Mountain Sports, Inc. v. Chrysler Corp., 968 F.Supp. 568, 

578 (D.Colo. 1999). Because the cases focus on situations in which the two components of the 

niche fame doctrine are not present—fame of the plaintiff’s mark in a specific market segment 

and use by defendant of its mark in the same segment—these decisions should not be read to 

reject a niche fame standard per se or to favor a ‘‘national renown’’ standard. 5The FTDA lists 8 non-exclusive factors that a court may consider to determine whether the 

mark is distinctive and famous.’’ See Syndicate Sales, 192 F.3d at 639, citing 15 U.S.C. 

§ 1125(c)(1). Factor F embraces ‘‘the degree of recognition of the mark in the trading areas and 

channels of trade used by the marks’ owner and the person against whom the injunction is 

sought.’’ 15 U.S.C. § 1125(c)(1)(F). 6The Court also relied on Professor McCarthy, citing 4 J. Thomas McCarthy, McCarthy on 

Trademarks and Unfair Competition (‘‘McCarthy’’) § 24:112 at 24–204 to 24–205 (1999). However, Professor McCarthy no longer supports the concept of niche fame: ‘‘In the author’s view, 

the federal anti-dilution act does not require courts to recognize the phenomenon of niche 

fame. . . . [Indeed,] recognition of niche fame is an improper application of the federal act, is 

an unnecessary and superfluous legal theory and improperly displaces the traditional balance 

of competitive rights reflected in the likelihood of confusion test [for trademark infringement].’’ 4 McCarthy § 24:112.1 at 24–273 (2003). 

famous mark...’’). The Third, Fifth, Seventh and Ninth Circuits hold that fame 

of a mark in a particular market segment may be sufficient to satisfy the FTDA’s fame requirement when the junior user’s mark is used in the same market segment. 

The First and Second Circuits reject the ‘‘niche market’’ standard, while the other 

Circuits have not formally opined on the issue. 

The following survey of the leading Circuit Court of Appeals opinions begins with 

the Seventh Circuit’s Syndicate Sales decision because its analysis was particularly 

thorough and because it is widely cited by the other Circuits in their opinions on 

the issue. 

Syndicate Sales, Inc. v. Hampshire Paper Corp., 192 F.3d 633 (7th Cir. 1999): This 

case centered on a trade dress infringement and dilution dispute between manufacturers of competing plastic baskets used for floral bouquets at funerals. See Syndicate Sales, 192 F.3d at 635. Finding that plaintiff’s trade dress was famous, if at 

all, only among wholesalers and retail florists, the trial court held that fame in such 

a niche market cannot be sufficient to establish fame for purposes of the FTDA. Id.

at 640. The Seventh Circuit disagreed and remanded for consideration of whether 

Syndicate Sales’ trade dress was sufficiently famous in the market of wholesale and 

retail florists to qualify for federal dilution protection. Id. at 641. 

A mark may be eligible for protection under the FTDA, the Seventh Circuit concluded, even when its fame is ‘‘limited to those engaged on a regular basis in commercial activity involving [the mark’s] product.’’ Id. at 641 fn.7.3 Specifically, the 

FTDA’s fame requirement may be satisfied when a senior mark is famous in a particular commercial market segment and defendant is using its allegedly diluting 

mark in the same market. Id. at 641. 

The court noted that prior decisions in which the courts held niche-fame insufficient had generally addressed situations in which the disputed marks were used in 

separate markets,4 while cases recognizing niche-market fame concerned disputed 

marks used in the same or related markets. Id. at 640. The court reasoned that one 

of the FTDA’s ‘‘fame’’ factors, i.e. 15 U.S.C. § 1125(c)(1)(F) (hereafter ‘‘Factor F’’), ‘‘may be constricted to a particular market.’’ 5 Id. at 641. The ‘‘narrowness of the 

market in which a plaintiff’s mark has fame’’ must be considered, presumably 

against a finding of fame, but is ‘‘less important’’ when the defendant uses its mark 

in the same market. Id. The court also found support for the niche fame concept 

in the Restatement, which concluded that: ‘‘A mark that is highly distinctive only 

to a select class or group of purchasers may be protected from diluting uses directed 

at that particular class or group. Id. at 640, citing Restatement (Third) of Unfair 

Competition, § 25, cmt. e (1995).6

Times Mirror Magazines, Inc. v. Las Vegas Sports News, L.L.C., 212 F.3d 157 (3rd 

Cir. 2000), cert. denied, 531 U.S. 1071 (2001): In this case, the Third Circuit affirmed a preliminary injunction on trademark dilution grounds. See Times Mirror,

212 F.3d at 160, 170. Plaintiff’s publication, The Sporting News, provided information on sports such as baseball, basketball, football and hockey and had a weekly 
31

7On the one hand, Judge Barry noted that ‘‘the legislative history does not mention much 

less embrace a so-called‘niche market’ theory of fame.’’ Times Mirror, 212 F.3d at 173. Moreover, ‘‘although Factor (F) focuses the analysis on the channels of trade in which the parties operate, 

it does not dictate the conclusion that fame solely within those channels of trade is enough for 

protection.’’ Id. at 175. That analysis supports the conclusion that only widely-renowned marks 

deserve federal dilution protection. Or as Judge Barry states towards the end of her dissent, 

‘‘I do not believe . . . [that] a mark not immediately recognizable by the general public can . . . 

meet the fame requirement of the FTDA. Id. at 179. But Judge Barry also worried that ‘‘the 

niche market theory risks lowering the bar for trademark protection unless it is applied prudently to cases which clearly call for such an analysis, and this is not one.’’ Id. at 173; emphasis 

added. Moreover, Judge Barry urges a court inclined to rule that a mark ‘‘famous only in its 

niche market . . . is entitled to protection under the FTDA, the evidence of fame should be rigorously examined.’’ Id. at 174. 8See Thane, 305 F.3d at 908 (noting the Avery Dennison Court’s ‘‘repeated admonition that 

only prominent and renowned marks deserve [federal dilution protection]. . .’’

circulation of about 540,000 in the United States and Canada. The Sporting News

was sold at newsstands throughout the country and was advertised on television, 

on radio, and in direct mail. Id. at 161–162. Defendant’s Las Vegas Sporting News

focused on ‘‘sports wagering‘for the sports gaming enthusiasts...’ ’’ Id. at 161 (internal record citation omitted). With a circulation of 42,000, the Las Vegas Sporting 

News was also sold at newsstands across the country, but most copies were given 

away free in gambling casinos. Id. Citing Syndicate Sales and the Restatement, the 

Third Circuit endorsed the niche-fame standard: ‘‘We are persuaded that a mark not 

famous to the general public is nevertheless entitled to protection from dilution 

where both the plaintiff and defendant are operating in the same or related markets, so long as the plaintiff’s mark possesses a high degree of fame in its niche 

market.’’ Id. at 164. The court held that the two marks at issued ‘‘shared a common 

market,’’ i.e. the ‘‘sports periodical market.’’ Because ‘‘the mark‘The Sporting News’

was famous in its niche,’’ it was ‘‘entitled to protection under the FTDA against [Las 

Vegas Sporting News]’s used of a similar mark in the same market.’’ Id. at 165. 

In a sharply worded dissent, Judge Barry disagreed, although from her opinion 

it is not clear whether she rejects the niche fame doctrine entirely or as applied in 

this case.7 The problem with the niche fame doctrine, Judge Barry argued, is that 

it threatens to devour infringement law by providing a powerful trademark remedy 

in situations where infringement law ought to apply, but without plaintiffs having 

to prove likelihood of confusion. See id. at 174. In the case at bar, Judge Barry stated, plaintiff ought to have shown that its mark was ‘‘truly famous among members 

of the general public.’’ Id. at 176. Even as to Factor F, plaintiff failed to present 

evidence that its mark was ‘‘recognized by a substantial portion of [Las Vegas Sporting News]’s potential consumers.’’ Id. at 175. 

Advantage Rent-A-Car, Inc. v. Enterprise Rent-A-Car, Co., 238 F.3d 378 (5th Circuit 2001): At issue in this case were similar slogans used by two rental car companies—Advantage’s ‘‘We’ll Even Pick You Up’’ and Enterprise’s ‘‘We’ll Pick You Up’’

and ‘‘Pick Enterprise. We’ll Pick You Up.’’ See Advantage, 238 F.3d at 379. In denying Enterprise relief on its federal dilution claim, the district found that its mark 

was sufficiently famous. Id. at 379–380. The Fifth Circuit affirmed this finding, but 

cautioned that ‘‘[t]o the extent that the district court’s opinion can be read to suggest that Enterprise needed to prove fame beyond its market, we disagree.’’ Id. at 

380. Instead, the Court held, the correct standard was that adopted by the Seventh 

Circuit in Syndicate Sales and therefore what Enterprise needed, but failed, to 

prove was that its mark was famous ‘‘within the car rental industry, not in a broader market.’’ Id.

Thane Int’l, Inc. v. Trek Bicycle Corp., 305 F.3d 894 (9th Cir. 2002): In this action 

seeking declaratory relief, Trek had long used its trademark ‘‘TREK’’ on bicycles and 

related products, while Thane manufactured a stationary exercise machine under 

the ‘‘OrbiTrek’’ mark. See Thane, 305 F.3d at 898. The Ninth Circuit reversed summary judgment entered in Thane’s favor on Trek’s infringement claim, but affirmed 

on Trek’s dilution claim. Id. at 913. 

Despite clear misgivings about the doctrine,8 the Thane court reaffirmed its prior 

endorsement of the niche fame standard that ‘‘marks famous in only a limited geographic area or a specialized market segment can be‘famous’ for the purposes of the 

federal anti-dilution statute.’’ Id. at 908, citing Avery Dennison Corp. v. Sumpton, 

189 F.3d 868, 877 (9th Cir. 1999). The court stressed that the FTDA ‘‘protects a 

mark only when a mark is famous within a niche market and the alleged diluter 

uses the mark within that niche.’’ Id., emphasis original; see also Avery Dennison, 

189 F.3d at 877 (‘‘[F]ame in a localized trading area may meet the [statutory fame 
32

requirement, as may] ‘‘specialized market segments . . . [when] the diluting uses 

are directed narrowly at the same market segment’’; internal citations omitted). 

A finding of fame for dilution purposes was unwarranted in the case at bar, the 

court explained, because, while TREK was a famous mark in the ‘‘non-stationary bicycle’’ market segment, its fame did not extend to the market segment that Thane 

functioned in—‘‘stationary exercise machines.’’ Id. at 910. The analysis may turn on 

the appropriate level of generality; to establish niche fame, the relevant market 

must be defined very precisely: ‘‘To maintain coherence, the niche fame concept 

must focus on highly specialized market segments with an identifiable customer 

base.’’ Id. at 909. Within such well-defined market segments, ‘‘participants are likely 

to make associations between marks that the general public will not make.’’ Id. Conversely, as the level of generality expands—for example, conceiving the market in 

the case at bar as ‘‘sporting goods’’—it becomes less likely that consumers in the 

various submarkets will form associations between disputed marks: ‘‘There is no 

reason why participants in this broad market will have any particular knowledge 

about products in submarkets in which they do not participate.’’ See id.

Further, in assessing niche fame, the extent and duration of use within the particular market segment is crucial: ‘‘[A] mark that is not widely associated with a 

particular product within a particular niche market is almost surely not famous in 

that market.’’ Id. Federal dilution law seeks to prevent junior users from appropriating the goodwill that a famous mark has developed over time. ‘‘Where there 

has been no successful, long-term development of goodwill with respect to particular 

markets, asserting fame within that specialized market is simply inconsistent with 

the purpose of the antidilution protection.’’ Id. Accordingly, Trek’s brief sale of stationary exercise bicycles or plans to re-enter that market did not support its dilution 

claim. Id.

I.P. Lund Trading ApS v. Kohler Co., 163 F.3d 27 (1st Cir. 1998): In a trade dress 

dispute involving the design and appearance of water faucets, the 1st Circuit affirmed the denial of a preliminary injunction on I.P. Lund’s infringement claim and 

vacated the grant of the injunction on its federal trademark dilution claim. See, I.P. 

Lund, 163 F.3d at 32. In creating an ‘‘exceptional anti-dilution remedy for truly famous marks,’’ the court explained, the FTDA imposed a ‘‘heightened’’ and ‘‘rigorous 

standard for fame.’’ Id. at 33, 47. Accordingly, ‘‘national renown is an important factor in determining whether a mark qualifies as famous under the FTDA.’’ Id. at 47. 

By this standard, the fact that I.P. Lund’s faucet may have been ‘‘renowned . . . 

in the world of interior design and high-end bathroom fixtures’’ did not establish 

that its design was ‘‘sufficiently famous to qualify for the FTDA’s protection.’’ Id.

at 60. 

TCPIP Holding Company, Inc. v. Haar Communications, Inc., 244 F.3d 88 (2d Cir. 

2001): In this case, the operator of a chain of children’s clothing stores under the 

registered mark ‘‘The Children’s Place’’ obtained a preliminary injunction barring 

defendant from using a number of internet domain names it owned that incorporated variations on plaintiff’s mark. TCPIP, 244 F.3d at 90. While affirming the 

injunction as to some of defendant’s domain names on infringement grounds, the 

Second Circuit vacated the injunction to the extent it was based on the FTDA. See 

id. 

The court emphasized the greatly ‘‘expanded rights’’ conferred by federal dilution 

law over those enjoyed under traditional infringement law and its likelihood of confusion analysis. See id. at 94–95. The FTDA gave a trademark owner ‘‘a far greater 

scope of exclusivity’’ than classic trademark infringement law and, because of that 

expansion, restricted the ‘‘class of entities for whose benefit the law was created.’’

See id. at 95. In view of the broad sweep of anti-dilution protect and the narrow 

range of intended beneficiaries, the court reasoned that Congress likely did not intend ‘‘to confer on marks that have enjoyed only brief fame in a small part of the 

country, or among a small segment of the population, the power to enjoin all other 

users throughout all realms of commerce.’’ Id. at 99. Accordingly, the FTDA’s protections did not extend to marks ‘‘that are famous in only a small area or segment of 

the nation,’’ but rather only to marks that carry ‘‘a substantial degree of fame.’’ Id.

Plaintiff’s evidence did not amount to such a showing and, accordingly, the preliminary injunction had to be vacated to the extent it was premised on the FTDA. See 

id. at 100. 
33

9Disagreed with on other grounds, Harrods Ltd. v. Sixty Internet Domain Names, 302 F.3d 

214, 228–232 (4th Cir. 2002). 

B. Selected District Court Decisions from Other Circuits Show Divergence 

In The Approach To Niche Fame 

Fourth Circuit 

Hartog & Co. AS v. SWIX.com, 136 F.Supp.2d 531, 534(E.D.Va. 2001) 9—In this 

case, a manufacturer of a line of ski waxes, marketed under the trademark ‘‘SWIX,’’

sued an Internet services company that operated under the trade name SWiX Internet Dienste. See Hartog, 136 F.Supp.2d at 534. Adopting the niche-fame doctrine, 

the court found no dilution on the ground that the two companies operated in different market segments. Id. at 538, citing Syndicate Sales, Inc. v. Hampshire Paper 

Corp., 192 F.3d 633, 640 (7th Cir. 1999). Because of the distinct market segments, 

‘‘the popularity of plaintiff’s‘SWIX’ mark among American skiers is not enough to 

render it ‘‘famous’’ under the Lanham Act.’’ Id.

Eighth Circuit 

Ott v. Target Corp., 153 F.Supp.2d 1055 (D.Minn. 2001)—In this action, a designer and manufacturer of collector dolls sued a store chain and other defendants 

over a line of dolls that she claimed infringed and diluted her products’ trademarks 

and trade dress. See Ott, 153 F.Supp.2d at 1058–1062. Rejecting the ‘‘niche fame’’

doctrine, the court ruled that plaintiff’s trademark dilution claim failed as a matter 

of law. Id. at 1075. 

Sharing Judge Barry’s concern that trademark dilution based on niche fame 

risked subsuming classic infringement law, the court concluded that ‘‘the niche-market theory is inconsistent with the purposes of trademark dilution law.’’ Id. at 1075 

(citing Times Mirror Magazines, Inc. v. Las Vegas Sports News, L.L.C., 212 F.3d 

157, 174 (3d Cir. 2000)). The court emphasized that dilution law was designed to 

protect marks on non-competing goods and services. Id. at 1076 (citing Viacom Inc.

v. Ingram Enterprises, Inc., 141 F.3d 886, 888 (8th Cir. 1998)). The court explained: 

‘‘Because this case involves directly competing products, application of the nichemarket theory would result in an over-extension of the protection afforded by the 

FDTA and would render trademark infringement laws duplicative.’’ Id.

Eleventh Circuit 

Carnival Corp. v. SeaEscape Casino Cruises, Inc., 74 F.Supp.2d 1261 (S.D.Fla. 

1999)—In a case involving two cruise lines, the court held that plaintiff’s mark was 

insufficiently famous to warrant federal dilution protection. See Carnival, 74 

F.Supp. 2d at 1261. In applying the niche-fame doctrine, the court noted that, while 

the Eleventh Circuit had yet to explicitly address the issue, it had affirmed a previous lower court decision that had applied the doctrine. Id. at 1271 (citing Michael 

Caruso & Co., Inc. v. Estefan Enterprises, Inc., 994 F.Supp. 1454, 1463 (S.D.Fla. 

1998), aff’d, 166 F.3d 353 (1998)). The court found that the two companies operated 

in related, but different markets namely Carnival offered several day ‘‘vacation’’

cruises, ‘‘while SeaEscape’s product is a day or evening of entertainment at sea.’’

Id. at 1270–1271. Also finding Carnival’s survey evidence weak, the Court held that 

plaintiff’s mark was not ‘‘famous’’ for purposes of a federal dilution claim. See id.

at 1721. 

C. Conclusion 

Although the courts are split on the issue of niche fame which usually suggests 

the need for a legislative change, the time is not ripe to consider a such a change. 

There is no consensus in the trademark community, in contrast to the case of protecting marks that have acquired distinctiveness, as to the resolution of this issue. 

There is too much disagreement over what the specific changes should be, if any, 

and thus no change is warranted at this time. As the courts continue to address 

the issue, a consensus may develop on the issue that does not now exist.

Mr. SMITH. Mr. Johnson. 

STATEMENT OF MARVIN J. JOHNSON, LEGISLATIVE COUNSEL, 

AMERICAN CIVIL LIBERTIES UNION 

Mr. JOHNSON. Thank you, Mr. Chairman. Chairman Smith and 

Ranking Member Berman, I am pleased to appear before you today 

on behalf of the American Civil Liberties Union and its more than 
34

400,000 members across the country to discuss the committee print 

to amend the Federal Trademark Dilution Act, or FTDA. 

At the outset, let me say that trademarks provide an important 

tool for preventing confusion or deceptive marketing. To the extent 

that legislation furthers this goal, it is helpful and it is generally 

not destructive of the First Amendment values. After all, the First 

Amendment does not normally protect deceptive or misleading 

speech, particularly in a commercial context. 

However, there is a dynamic tension between the First Amendment and trademark law. On the one hand, you have trademark 

holders who want to be able to control what people say using their 

particular trademark. On the other hand, you have people who 

want to exercise their rights of free speech which is guaranteed by 

the First Amendment to the Constitution of the United States, and 

sometimes that free speech is going to be abrasive and it may not 

be terribly complimentary to the particular trademark holder. 

Now, the First Amendment protects not only the right to speak 

but the manner of speaking, as well, and so in using the trademark, they are using the trademark, if they are using it in a free 

speech context, they are using it in a perfectly permissible manner. 

But increasing the rights of trademark holders necessarily dilutes 

the rights of the people who want to speak because, essentially, you 

are giving a monopoly to the trademark holders of the use of that 

mark. 

For example, if Kodak is trademarked, then Kodak has the right 

to exclusive use of that mark. Minolta cannot market cameras 

under the Kodak name. Now, to the extent that trademark law prevents this confusion over who made the product, it is helpful. However, this concept of whether it is likely to be confused has also 

been an important check on the power of trademark law to infringe 

upon the rights of free speech. While a camera marketed by Minolta under the Kodak name might be confusing to consumers, a 

parody or criticism of Kodak is unlikely to be confusing about the 

origin of the product. Thus, consumers are protected and free 

speech is preserved. 

The Federal Trademark Dilution Act, however, makes the concept of confusion irrelevant, tilting the balance of power in favor of 

the trademark owners. Now, currently, there was some balance in 

the sense that the Supreme Court had held that there was supposed to be actual dilution. That, of course, raised the standard. It 

did make it a little more difficult in order to prove, and therefore, 

there was more protection for free speech. 

However, when you go to likelihood of dilution, that creates some 

problems. This particular provision in broadening to likelihood of 

dilution, basically, it allows speech critical of a company to be enjoined even if it is true, because it is likely to result in dilution. 

Now, this provision is particularly insidious because, unlike defamation law, under the FTDA, a preliminary injunction may be 

granted silencing the speaker until after a trial. Therefore, on speculation that a trademark may be diluted, a speaker may be muzzled. 

Now, as noted in my testimony, the likelihood of dilution standard has been used, particularly in the Second Circuit, to try to stop 

free speech that is critical to the trademark holder. When you cou-
35

ple that with dilution by tarnishment, it becomes particularly problematic. This proposed bill would, for the first time, give statutory 

recognition to the dilution by tarnishment. When you couple that 

with likelihood of dilution, you now end up with causes of action 

for the likelihood of tarnishment. 

Now, since tarnishment normally refers to comments that portray the trademark in an unwholesome or unsavory context likely 

to evoke unflattering thoughts about the owner’s product, we now 

have a direct conflict between trademark and free speech. To the 

extent that any parody or criticism evokes unflattering thoughts 

about the owner’s product, it has resulted in tarnishment and can, 

therefore, be enjoined. 

Now, on my written testimony, I have presented some examples, 

and I have some color examples here of the Joe Chemo ad that appeared in Ad Busters, and it is clearly a parody of the Joe Camel 

ad, or the trademark of Joe Camel for Camel cigarettes And so basically what you have here is a parody of the Joe Camel trademark, 

which is essentially talking about the dangers of smoking, and you 

have Joe Chemo here who is undergoing chemotherapy and has 

lost all of his hair and sitting here in a hospital bed, but it is clearly a parody that is being used to poke fun at this particular trademark. 

Now, do they intend an association with that trademark? Well, 

obviously. That is what you intend with a parody. So they have intended that association. Is it going to cause some sort of unflattering association with the trademark? That is certainly what they 

hope when they are trying to discourage smokers. So the idea here 

is that if you allow this tarnishment to be coupled with likelihood 

of dilution, it is very likely that the Joe Chemo ads and other ads 

like them could be hurt and would be stopped simply because it 

may likely result in tarnishment of the trademark. 

Now, we are not saying that Congress was unmindful of this tension between trademark and free speech. Obviously, there are some 

exemptions. Those exemptions have not been as protective of free 

speech as Congress had hoped. So because of that, we have grave 

concerns about the proposed bill as written, but we would be happy 

to work with the Committee to see if we can come to a resolution 

that would be more protective of free speech and still accomplish 

the goals. 

Mr. SMITH. Thank you, Mr. Johnson. 

[The prepared statement of Mr. Johnson follows:]

PREPARED STATEMENT OF MARVIN J. JOHNSON

Chairman Smith, Ranking Member Berman and Members of the Subcommittee: 

I am pleased to appear before you today on behalf of the American Civil Liberties 

Union and its more than 400,000 members, dedicated to preserving the principles 

of the Constitution and the Bill of Rights, to explain the ACLU’s views on the Committee Print to Amend the Federal Trademark Dilution Act. This bill proposes to 

greatly expand the existing Act, making dilution actions easier for trademark holders while simultaneously diluting protections for free speech. We urge you to continue to require actual dilution in any cause of action, and to make some other 

amendments that will be more protective of free speech. 

Trademark law provides an important tool for preventing confusion or deceptive 

marketing, but trademark laws should not be used as a pretext to stifle criticism, 

parody or legitimate competition when there is no reasonable likelihood of confusion 

and no actual dilution caused by use of the trademark. 
36

1See 2 J. Thomas McCarthy, McCARTHY ON TRADEMARKS AND UNFAIR COMPETITION 

§ 2:32 (explaining that the limited, quasi-property right of trademark holders has extended from 

tort, rather than property law). 2 1 Pat. L. Fundamentals § 4.04 (2d ed.). Some commentators have opined that anti-dilution 

statutes are inherently antithetical to the First Amendment. See, e.g., Marla J. Kaplan, 

‘‘Antidilution Statutes and the First Amendment,’’ 21 Southwestern University Law Review 

1139 (1992) (arguing that antidilution statutes violate the First Amendment because they prohibit commercial speech that does not mislead or deceive and because there is no substantial 

government interest to support them; also arguing that antidilution laws are not designed to 

protect the public, as was trademark law’s historical purpose.) 3 Restatement (Third) of Unfair Competition § 25 cmt. i (1995). See, also, ACLU v. Miller, 977 

F.Supp. 1228 (N.D. Ga. 1997) in which the court granted a preliminary injunction against a 

statute forbidding ‘‘any person . . . knowingly to transmit any data through a computer network 

. . . if such data uses any . . . trade name, registered trademark, logo, legal or official seal, 

or copyrighted symbol . . . which would falsely state or imply that such person . . . has permission or is legally authorized to use [it] for such purpose when such permission or authorization 

has not been obtained.’’ The court found this provision overbroad, in that it prohibited speech 

protected by the First Amendment. 4 CPC International, Inc. v. Skippy Incorporated, 214 F.3d 456 (4th Cir. 2000). 5 Id. at 462.

This proposed bill is a significant expansion of the current dilution statute, and 

allows injunctions of speech in more instances. Dilution causes of action are problematic under the First Amendment because they allow commercial entities to secure injunctions prohibiting speech that is truthful and neither misleading or confusing. The basis of the injunction is that someone else other than the trademark 

holder used a word that is identical or similar to a trademark, and that the use 

might lessen the consuming public’s association of the term with the trademark. 

Congress initially drafted the Federal Trademark Dilution Act (‘‘FTDA’’) somewhat 

narrowly, requiring proof of actual dilution. This lessened the statute’s impact on 

First Amendment activity. The proposed revision, however, adopts a ‘‘likelihood of 

dilution’’ standard, significantly easing the burden of proving ‘‘dilution,’’ and increasing the danger to First Amendment activity. 

We will first provide some background on the tension between trademarks and 

free speech, and then discuss specific problems with the proposed bill. 

BACKGROUND

Trademark law developed primarily to protect the interests of consumers to receive reliable information about goods and services. To accomplish this objective, the 

suppliers of these goods and services were granted limited rights to regulate the 

misleading use of their brands and associated symbols. The grant of these rights, 

however, has the potential to impinge upon the ability of the public to communicate 

and receive information. Purposeful limitations were therefore placed on the rights 

of the trademark holder to avoid this problem. One of those limitations was the doctrine of ‘‘confusion’’: trademark rights were only enforceable where another’s use is 

likely to cause confusion.1 This standard alleviates the tension between the interests 

of consumers and the broader free speech interest of the public in general. 

Courts and commentators have long recognized that trademark liability implicates 

the First Amendment. ‘‘Because the trademark law regulates the use of words, pictures, and other symbols, it can conflict with values protected by the First Amendment. The grant to one person of the exclusive right to use a set of words or symbols 

in trade can collide with the free speech of others.’’ 2 The Restatement (Third) of Unfair Competition noted in a comment that the ‘‘use of another’s trademark, not as 

a means of identifying the user’s own goods or services, but as in incident of speech 

directed at the trademark owner, . . . raises serious free speech concerns.’’ 3

Noting the conflict between trademark law and free speech, the Fourth Circuit 

Court of Appeals stated in CPC International, Inc. v. Skippy Incorporated: 4

It is important that trademarks not be ‘‘transformed from rights against unfair 

competition to rights to control language.’’ . . . Such a transformation would diminish our ability to discuss the products or criticize the conduct of companies 

that may be of widespread public concern and importance. . . . ‘‘Much useful 

social and commercial discourse would be all but impossible if speakers were 

under threat of an infringement lawsuit every time they made reference to a 

person, company or product by using its trademark.’’ 5

Despite free speech concerns, Congress passed the FTDA in 1995 to provide protection from trademark dilution. ‘‘Dilution’’ is defined as the ‘‘lessening of the capacity 

of a famous mark to identify and distinguish goods orservices, regardless of the 
37

6 15 U.S.C. 1127. 

7 Ringling Brother-Barnum & Bailey Combines Shows, Inc. v. Utah Division of Travel Development, 170 F.3d 449 (4th Cir. 1999); Westchester Media v. PRL USA Holdings, Inc., 214 F.3d 

658 (5th Cir. 2000). 8 I.P. Lund Trading ApS, Inc. v. Kohler Co., 163 F.3d 27 (1st Cir. 1998); Nabisco, Inc. v. PF 

Brands, Inc., 191 F.3d 208 (2d Cir. 1999); V Secret Catalogue Inc. v. Moseley, 259 F.3d 464 (6th 

Cir. 2001); Eli Lilly & Co. v. Natural Answers Inc., 233 F.3d 456 (7th Cir. 2000). 9The Supreme Court did not reach any issue of constitutionality in the case. It was decided 

purely on the basis of statutory construction. 10 ‘‘Blurring’’ involves the gradual whittling away or dispersion of the identity and hold upon 

the public mind of the mark or name by its use upon noncompeting goods. ‘‘Tarnishment’’ results when one party uses another’s mark in a manner that tarnishes or appropriates the goodwill and reputation assosciated with the mark. 11WWF v. Bozell, 142 F.Supp.2d 514 (SDNY 2001). 

presence or absence of—(1) competition between the owner of the famous mark and 

other parties, or (2) likelihood of confusion, mistake or deception.’’ 6

The FTDA provides, in part, that the owner of a famous mark is entitled to relief 

against another’s commercial use in commerce of a mark, ‘‘if such use begins after 

the mark has become famous and causes dilution of the distinctive quality of the 

mark.’’ [Emphasis added.] Because of the ‘‘causes dilution’’ language, the Fourth and 

Fifth Circuits required there be actual proof of dilution.7 The First, Second, Sixth, 

and Seventh Circuits, however, adopted a ‘‘likelihood of dilution’’ standard, as they 

believed actual dilution would be impossible to prove.8 The Supreme Court settled 

the controversy in Moseley v. V Secret Catalogue, Inc., 537 U.S. 418 (2003), when 

it held that the statute required actual proof of dilution.9 The proposed bill seeks 

to overturn Moseley by amending the statute to only require ‘‘likelihood of dilution.’’ While this makes it much easier for trademark holders to bring dilution actions, it 

also significantly decreases protection for activities protected under the First 

Amendment. 

The government interest in protection of trademarks arises when the use of a 

trademark diminishes its distinctiveness. Trademarks are valuable as identifiers of 

the source of goods. To the degree this effect is hindered, the public is harmed. The 

use of a mark to identify the source of a product is central to dilution actions. Consider the example used in the original article in 1927 to justify dilution statutes, 

and the example used during debates on the FTDA in 1995: the use of the name 

Kodak on pianos. Where the use of a trademark leads to confusion as to the source 

of the product, the government may have a ‘‘substantial interest’’ in preventing dilution. After all, slapping the brand name ‘‘Kodak’’ on a piano has little expressive 

purpose and could lead to consumer confusion. 

Where, however, a trademark is used for parody, commentary, or criticism of a 

product or service, confusion is far less likely, and the government’s interest in protecting a trademark over free speech is minimal. As noted above, empowering trademark owners to quash criticism merely because it involves the use of a trademark 

transforms the trademark owner into a monitor of the spoken and written English 

language. 

BECAUSE THE BILL WOULD REQUIRE ONLY A ‘‘LIKELIHOOD OF DILUTION,’’ INSTEAD OF

ACTUAL DILUTION, TRADEMARK HOLDERS WILL BE ABLE TO STIFLE SPEECH THAT IS

CRITICAL OF THEIR TRADEMARK. 

To allow actions for ‘‘likelihood of dilution’’ would broaden dilution to permit injunctive relief against speech that is not confusing or deceptive and has not yet 

caused harm. Since dilution can occur either by blurring or tarnishment,10 this 

broadening would include the ‘‘likelihood of tarnishment.’’ Thus, under the ‘‘likelihood of dilution’’ standard, speech critical of a company could be enjoined, even if 

true, because it is likely to result in tarnishment. 

The idea that trademark owners would use the FTDA to stifle criticism is far from 

a fanciful notion. It occurred in the Second Circuit, which had interpreted the FTDA 

to require only a ‘‘likelihood of dilution.’’ In WWF v. Bozell,11 the World Wrestling Federation (WWF) sued individuals for 

defamation and dilution of the WWF mark. The defendants had embarked on a public relations campaign claiming that the WWF was in part responsible for the 

deaths of several children killed by teenage wrestling fans who claimed to be mimicking WWF wrestling moves. This speech clearly should have been protected speech 

under the First Amendment. The court, however, held that the public relations campaign qualified as ‘‘commercial use in commerce’’ as required by section 43(c) of the 

Lanham Act because defendants attempted to raise money for their cause (‘‘commer- cial use’’) and posted their statements on the Internet (‘‘in commerce’’). Thus, 

Bozell’s actions did not fit within the exemption for noncommercial use of a mark, 
38

12Scholastic Inc. v. Stouffer, 124 F.Supp.2d 836 (S.D.N.Y. 2000). 13 Id. at 849. 14 Id. at 852. 15Westchester Media v. PRL USA Holdings, Inc., 214 F.3d 658, fn. 12 (5th Cir. 2000). 16 Id. 17 Id. 18Deere & Company v. MTD Products, Inc., 41 F.3d 39, 43 (2d Cir. 1994). 19The Supreme Court has recognized that commercial speech is entitled to First Amendment 

protection. See Va. State Bd. Of Pharmacy v. Va. Citizen’s Consumer Council, Inc., 425 U.S. 748, 

761 (1976). 20See Meyer v. Grant, 486 U.S. 414 (1988) (stating that the First Amendment not only protects the right to advocate a cause, but also the right to select the most effective means to do 

so). 

and therefore received no protection under the First Amendment. The court rejected 

defendants’ motion to dismiss. The court also rejected defendants’ claims that the 

First Amendment required dismissal. 

It is important to note that, unlike defamation claims, a dilution claim permits 

the court to order preliminary injunctive relief. The anti-violence/anti-WWF campaign could be enjoined pending trial in order to protect WWF from the ‘‘likelihood’’

that the campaign would tarnish its mark. 

In another case from the Second Circuit, Scholastic Inc. v. Stouffer,12 the author 

and publisher of the hugely popular Harry Potter books sought a declaratory judgment that it had not infringed on Stouffer’s copyrights or trademarks. Stouffer 

counterclaimed, alleging, among other things, dilution and defamation. The defamation claim was based on plaintiffs’ alleged portrayal of Stouffer as a ‘‘golddigger’’

whose claims were ‘‘absurd,’’ ‘‘ridiculous’’ and ‘‘meritless.’’ 13 The court dismissed the 

claim ‘‘to the extent it asserts a claim for defamation, but declines to dismiss this 

claim to the extent it asserted a claim for dilution under federal or state law.’’ 14

Therefore, a dilution action was allowed to proceed even though the comments 

should have been protected as free speech. 

By requiring only a ‘‘likelihood of dilution,’’ trademark holders will now have a 

more potent weapon to stifle speech that is critical or a parody of their trademark. 

Furthermore, unlike defamation law, under the FTDA a preliminary injunction may 

be granted, silencing the speaker until after a trial. Thus, on the speculation that 

a trademark may be diluted a speaker may be muzzled. In essence, trademark holders now have a monopoly on certain words, expressions and images. 

We urge you to reject the ‘‘likelihood of dilution’’ standard and maintain the ‘‘actual dilution’’ language currently in the FTDA. 

BECAUSE THE BILL WOULD MAKE DILUTION BY TARNISHMENT ACTIONABLE, THE BILL

WOULD STIFLE FREE SPEECH. 

Specifically recognizing ‘‘tarnishment’’ as a cause of action opens the door to silencing critics of a trademark, 

There are two commonly recognized forms of dilution: blurring and tarnishment.15

‘‘Blurring involves the gradual whittling away or dispersion of the identity and hold 

upon public mind of the mark or name by its use upon noncompeting goods.’’ 16

‘‘Tarnishment results when one party uses another’s mark in a manner that tarnishes or appropriates the goodwill and reputation associated with the mark.’’ 17 The 

current FTDA applies to dilution by blurring, but does not make dilution by 

tarnishment actionable (although some courts have read it to include tarnishment). 

The proposed bill would explicitly make tarnishment actionable as well. 

‘‘Tarnishment generally arises when the plaintiff’s trademark is linked to products 

of shoddy quality, or is portrayed in an unwholesome or unsavory context likely to 

evoke unflattering thoughts about the owner’s product.’’ 18 Unfortunately, it also 

provides trademark holders with another cause of action to silence critics. Additionally, a broad application of tarnishment acts to chill commercial speech.19 For example, in Deere v. MTD, the court found dilution by tarnishment where a competitor 

showed Deere’s trademark, a running deer, fleeing from the competitor’s tractor. 

What the proposed bill fails to recognize is that trademarks have a huge impact 

on our shared culture. Trademarks have become essential to the communication 

about particular goods or services, often representing the most effective means by 

which to state one’s position.20

By coupling the ‘‘likelihood of dilution’’ standard along with tarnishment, trademark holders can now argue their trademark is ‘‘likely to be tarnished’’ and possibly 

prevail, even though no tarnishment has actually occurred. Furthermore, the trademark holder can obtain an injunction against the speech long before a trial is even 

held. 
39

21 Unless the material is found to be ‘‘obscene,’’ sexual material is protected under the First 

Amendment. We therefore do not recommend defining sexual activity that is not obscene as 

tarnishment. 22Michael A. Albert and Robert L. Bocchino, Jr., ‘‘Trade Libel: Theory and Practice Under the 

Common Law, The Lanham Act, and the First Amendment,’’ 89 Trademark Rep. 826, 883 

(1999). 23 Central Hudson Gas & Elec. v. Public Serv. Comm’n, 447 U.S. 557, 562 (1980), Bolger v. 

Youngs Drug Products Corp. 463 U.S. 60, 66 (1983). 24 Ibanez v. Florida Dept. of Business & Professional Regulation, Bd. Of Accountancy, 512 U.S. 

136 (1994). 25 Bolger, supra. at 62. 26 Id. 27 Id. at 67, fn. 14, and 66, fn. 13. 

If tarnishment remains as a cause of action, the exemptions must make clear that 

fair use and free speech are fully protected, even if used in commercial speech. Furthermore, the definition of ‘‘tarnishment’’ in Section 2(c)(2)(C) should be changed. 

Currently, it defines tarnishment as ‘‘association between a designation of source 

and a famous mark, arising from their similarity, that harms the reputation of the 

famous mark.’’ The definition is too vague and would sweep into it parody and criticism. After all, if the criticism is successful, won’t it ‘‘harm’’ the mark? If the parody 

(in the case of the Joe Chemo ‘‘subvertisement’’ contained in the Appendix) is successful in reducing smoking, isn’t it harming the mark? Tarnishment has traditionally been used where the mark is associated with illegal activity or sexual activity.21

‘‘Harm’’ should be more specifically defined to make it clear what kind of harm is 

contemplated. 

THE BILL INAPPROPRIATELY CONTINUES TO RELY ON A DISTINCTION BETWEEN ‘‘COMMERCIAL’’ AND ‘‘NONCOMMERCIAL’’ TO DETERMINE THAT ONLY ‘‘NONCOMMERCIAL’’

SPEECH IS PROTECTED. THIS STRIPS PROTECTION FROM COMMERCIAL SPEECH, AS

WELL AS SPEECH THAT HAS ONLY INCIDENTAL COMMERCIAL COMPONENTS. 

The fact that the communication carries a commercial component should not automatically deprive the communication of First Amendment protection. In many cases, 

the commercial component is what makes the communication viable. ‘‘A social satire 

is no less effective or communicative if sold than if given away, and the costs of 

printing and distributing the message . . . can generally be recouped through sales 

of the item in question.’’ 22 Furthermore, as even commercial speech is protected 

under the First Amendment, it makes little sense to deprive it of protection under 

the FTDA simply because it is commercial. 

It is not always easy to determine what is and is not ‘‘commercial’’ speech. The 

United States Supreme Court has held that commercial speech is ‘‘speech proposing 

a commercial transaction.’’ 23 Within those narrow confines, the definition may be 

sufficient. The question of what constitutes commercial speech however is far more 

nuanced, and bright lines are hard to find. For example, in Rubin v. Coors Brewing 

Co., 514 U.S. 476 (1995), the Court found that a statement of alcohol content on 

the label of a beer bottle constituted commercial speech. Likewise, the Court found 

commercial speech in statements on an attorney’s letterhead and business cards 

identifying him as a Certified Public Accountant and Certified Financial Planner.24

In Bolger, the United States Supreme Court was faced with a question of whether 

a federal law prohibiting the mailing of unsolicited advertisement for contraceptives 

violated the federal Constitution’s free speech provision as applied to certain mailings by a corporation that manufactured, sold, and distributed contraceptives. One 

category of the mailings in question consisted of informational pamphlets discussing 

the desirability and availability of prophylactics in general or the corporation’s products in particular. The Court noted that these pamphlets did not merely propose 

commercial transactions.25 While the parties conceded the pamphlets were advertisements, the Court did not find that fact alone sufficient to make them commercial 

speech, because paid advertisements are sometimes used to convey political or other 

messages unconnected to a product or service or commercial transaction.26 The 

Court concluded that a combination of three factors, all present in this case, provided strong support for characterizing the pamphlets as commercial speech. The 

three factors examined by the court were: (1) advertising format; (2) product references; and (3) commercial motivation. 

Part of the difficulty in applying Bolger is that the Court rejected the notion that 

any one of the factors was sufficient by itself, but also declined to hold all of these 

factors in combination, or any one of them individually, was necessary to support 

characterizing certain speech as commercial.27 It is no wonder the Supreme Court 
40

28 Edenfield v. Fane, 507 U.S. 761, 765 (1993). See also, Cincinnati v. Discovery Network, Inc., 

507 U.S. 410, 419 (1993) [recognizing ‘‘the difficulty of drawing bright lines that will clearly 

cabin commercial speech in a distinct category’’] and Zauderer v. Office of Disciplinary Counsel,

471 U.S. 626, 637 (1985) [stating that ‘‘the precise bounds of the category of . . . commercial 

speech’’ are ‘‘subject to doubt perhaps.’’]. 29Previous cases have demonstrated that protected speech tainted with magazine sales, Anheuser-Busch, Inc. v. Balducci Pub., 28 F.3d 769, 775 (8th Cir. 1994), or T-shirt sales, Mutual 

of Omaha Insurance Co. v. Novak, 836 F.2d 397, 402 n.8 (8th Cir. 1987), are not deemed ‘‘noncommercial’’ speech by the courts. 30See Appendix for examples. 31Mattel, Inc. v. MCA Records, Inc., 296 F.3d 894 (9th Cir. 2002). 32 Id. at 905. 33 Id. at 906. 

in later decisions acknowledged that ‘‘ambiguities may exist at the margins of the 

category of commercial speech.’’ 28

When given an opportunity to more clearly define commercial speech in Nike v. 

Kasky, the U.S. Supreme Court dismissed the case as having improvidently granted 

certiorari. Several members of the Court specifically noted the difficulty of the questions presented. As a result, lower courts are left to flounder, and often take an 

overly broad view of what constitutes commercial speech. 

Against this backdrop, and despite the fact that the Supreme Court has recognized that commercial speech enjoys First Amendment protection, the FTDA continues to rely upon a supposed bright-line distinction between fully protected and 

commercial speech, condemning any speech that is not ‘‘pure’’ (meaning it is not 

tainted with any commercial element).29

Reliance on this supposed ‘‘bright-line’’ distinction ignores the fact that effective 

speech is rarely ‘‘pure’’ in that it lacks some commercial component. Activist groups 

routinely seek donations on a web site to support their work, sell T-shirts, stickers 

and books, and possibly even allow advertising on the web site. Yet, under the 

FTDA, critical websites and parodies that generate incidental revenue could still be 

found to be ‘‘commercial’’ and therefore subject to an injunction. The result is a 

chilling of the expressive use of trademarks in speech that mixes traditionally understood free speech with commercial elements. 

An example is Adbusters Media Foundation and its magazine, Adbusters. This 

publication features advertisement parodies, called ‘‘subvertisements,’’ which use 

trademarks and corporate logos to generate awareness about social and political 

issues. One issue featured ‘‘Joe Chemo,’’ a parody of the ‘‘Joe Camel’’ character used 

by Camel cigarettes, to raise awareness of the health issues surrounding smoking.30

These ads represent a type of important civic speech that is traditionally protected 

under the First Amendment. It makes critical commentary on the trademark holder, 

furthering the traditional goals of trademark law by informing the consumer about 

the goods and services they purchase. While the speech is predominantly civic in 

nature, the commercial element of selling the magazine could well mean that the 

trademark holder under the FTDA could silence its critical speech. 

Although Congress in adopting the FTDA, characterized the noncommercial use 

exception as adequate to accommodate First Amendment concerns, that assessment 

has proved to be unduly optimistic. Even courts that reach the right result often 

have to strain to protect free speech. 

When faced with a trademark dilution claim for the parody song ‘‘Barbie Girl,’’

the Ninth Circuit Court of Appeals recognized that the song was entitled to protection under the First Amendment.31 It did not, however, fit neatly into the three exceptions noted in the FTDA: It was not comparative advertising, it was being sold 

for a commercial purpose, and it was not news reporting. In order to reach the correct result and deny the injunction, the court interpreted ‘‘noncommercial use’’ to 

refer to a use ‘‘that consists entirely of noncommercial, or fully constitutionally protected, speech.’’ 32 ‘‘If speech is not ‘purely commercial’—that is, if it does more than 

propose a commercial transaction—then it is entitled to full First Amendment protection.’’ 33 While such a result is correct, and comports with the legislative history 

of the FTDA indicating an intent to protect parodies, this is a somewhat strained 

definition, and certainly not followed by all courts. As noted above, in Bozell, a commercial purpose was found simply because Bozell sought donations over the Internet 

for his activities. Thus, the noncommercial use exception provides no consistent relief for those who engage in free speech activities. 

We recommend amending the exemptions to drop the distinction between ‘‘commercial’’ and ‘‘noncommercial’’ speech and provide an exemption for any speech protected by the First Amendment. 
41

34Moseley, supra. at 433. 35See Cohen v. California, 403 U.S. 15, 26 (1971) (recognizing that the elimination of particular words poses a substantial risk of suppressing ideas in the process).

INTENT OR BAD FAITH SHOULD BE AN ELEMENT OF THE BLURRING CAUSE OF ACTION. 

SECTION 2(C)(2)(B)(V)

One of the factors in determining dilution by ‘‘blurring’’ is ‘‘whether the user of 

the designation of source intended to create an association with the famous mark.’’

In a parody, or criticism, the user of the mark obviously intends to create an association with the famous mark. The mere mental association is insufficient to support 

a blurring cause of action.34 The lack of an element of intent or bad faith would 

allow blurring to silence parody or criticism based merely on the intended association. We recommend that this factor encompass some form of bad faith or intent to 

harm (being specific about the type of harm contemplated). 

HARM SHOULD ALSO BE INCORPORATED AS AN ELEMENT IN THE BLURRING CAUSE OF

ACTION. 

Section 2(c)(2)(B)(vi) provides another factor in determining ‘‘blurring,’’ and likewise relies upon association without a concomitant harm. [‘‘Any actual association 

between the designation of source and the famous mark.’’] Once again, a parody or 

criticism, if successful, would meet this criterion. 

We recommend that whatever harm this is intended to prevent be spelled out in 

more detail to avoid reliance on mere association as a factor in determining harm. 

SECTION 2(C)(4)(B) WOULD SWEEP IN PARODIES AND CRITICISM. 

Section 2(c)(4) provides for additional remedies (beyond an injunction) where the 

acts of the junior mark holder are intentional. Subsection B allows additional remedies in a tarnishment action where ‘‘the person against whom the injunction is 

sought willfully intended to trade on the reputation of the famous mark.’’ Once 

again, this is exactly what a parody or criticism does—it trades on the reputation 

of the famous mark. Thus, speech that should be protected under the First Amendment could be used to justify even more damages than just an injunction. 

THE FAIR USE EXEMPTION SHOULD BE EXPANDED TO ENCOMPASS ALL FAIR USES. 

Both the current and the proposed FTDA allow an exception for ‘‘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.’’ There 

is no rational basis for limiting fair use in this manner. Fair use is a much broader 

concept, and it should apply to trademark dilution actions in all situations, not just 

comparative advertising. 

CONCLUSION

By using trademark dilution as a claim, companies would have an additional potent weapon to silence their critics. Unlike defamation claims, the company need not 

demonstrate falsity or malice—only the ‘‘likelihood of tarnishment.’’ To the extent 

any critic is successful, companies may be able to establish that their trademark is 

‘‘likely to be tarnished.’’ Preliminary injunctive relief would silence the critics pending trial, even though the company has proven no actual harm to its trademark, 

and the court has made no final ruling that the critic’s speech is unprotected. 

As the FTDA expands, it alters the dynamic tension between trademark holders 

and free speech in favor of trademark holders. While enriching trademark holders, 

it dilutes free speech without any concomitant benefit to society. Furthermore, it 

places the trademark holder in the position of holding an indefinite monopoly in expressive subject matter, and obstructs the public’s ability to freely engage in a 

democratic dialogue.35
42

ATTACHMENT
43
44

Mr. SMITH. Mr. Stimson. 

STATEMENT OF DAVID C. STIMSON, CHIEF TRADEMARK 

COUNSEL, EASTMAN KODAK COMPANY 

Mr. STIMSON. Good morning, Mr. Chairman, Mr. Berman. Thank 

you for inviting me to testify. 

Kodak supports amending the Federal Trademark Dilution Act 

to address two issues raised by the Supreme Court’s Mosely decision. First, the Court said that the owner of a famous mark must 

wait until there is some sort of demonstrable harm before a judge 

can issue an injunction in a dilution case. Second, the Court raised 

the possibility that tarnishment of a famous mark may not be actionable under the current statute. 

The FTDA was designed to protect famous trademarks, like 

Kodak. In the nearly 125 years since it was first coined, the Kodak 

trademark has gained the loyalty and trust of hundreds of millions 

of American consumers over six generations and has been used on 

billions of products and has generated hundreds of billions of dollars of revenue. As a result, the Kodak trademark today is one of 

the strongest and most famous trademarks in the United States 

and around the world. Surveys of brand value have consistently 

confirmed this. 

Just as Kodak has worked hard to establish the Kodak trademark, my colleagues and I work hard to strengthen and protect it. 

We understand its value and we are serious about protecting our 

ownership rights. 

The FTDA has been an important part of our strategy. Since 

1996, it has been there to help protect the Kodak brand from blurring and tarnishing uses before it is irreparably damaged. However, in the Moseley decision, the Supreme Court said that the text 

of the FTDA leads to the conclusion that a famous trademark 

owner must prove actual harm before a court issues an injunction 

in a dilution case. Mr. Chairman, an actual harm standard undercuts the effectiveness of the statute. 

A requirement that Kodak show actual harm would require us 

to spend months litigating at the potential costs of hundreds of 

thousands of dollars in legal and survey fees. But even more importantly, in the meantime, the dilution would continue and the value 

of our trademark would be constantly diminishing at a huge cost 

that could not be calculated. Once the injunction was finally issued, 

the damage to our trademark would already have been done. 

As an example, if Kodak were to be used as the name of a magazine containing photographs of child pornography, the damage to 

Kodak’s image, reputation, and trademark would be obvious. If we 

were required to prove actual dilution, the sales of these magazines 

would continue and proliferate around the country. Even after we 

had shown actual dilution, we would never be able to retrieve all 

these magazines. Our Kodak trademark would be forever associated with child pornography in the minds of people who saw the 

magazines. 

Granting relief based on a showing of likelihood of dilution is essential for owners of famous trademarks to enable them to quickly 

stop this sort of serious damage to their reputation and good will. 

Therefore, Kodak believes that the best way to assure the effective-
45

1Pub. L. No. 104–98, 109 Stat. 505 (1995). 2 123 S. Ct. 1115 (2003). 

ness of a Federal dilution statute is to specifically incorporate a 

likelihood of dilution standard into the law. 

In light of the uncertainty raised by the Moseley decision, Kodak 

also supports adding to the FTDA an express cause of action for 

likelihood of dilution by tarnishment. To illustrate the need for protection against tarnishment, in the Internet world, there are unfortunately, Mr. Chairman, as you mentioned in your opening statement, many unscrupulous people who use our Kodak trademark as 

the domain names of websites that tarnish our Kodak trademark 

and identity. Some recent examples are kodak.net as the domain 

name for a website linked to a gambling casino; Kodaq with a 

‘‘q’’.net for a professional male escort; and kodakcompany.com for 

nude and lingerie models. The FTDA should be amended to make 

it clear that uses like these, which use our trademark in connection 

with unsavory activities and tarnish its value, constitute dilution. 

We would also add that if the Congress were to provide a specific 

cause of action for likelihood of dilution by tarnishment, there 

should also be a cause of action for likelihood of dilution by blurring, which is the other recognized form of dilution. 

Thank you, Mr. Chairman, Mr. Berman, for this opportunity to 

testify. Revising the FTDA is a matter of great importance to Eastman Kodak Company. We therefore ask for your support in passing 

the appropriate legislation and your assistance to Kodak and other 

U.S. companies in protecting their valuable trademark assets. 

Thank you. 

Mr. SMITH. Thank you, Mr. Stimson. 

[The prepared statement of Mr. Stimson follows:]

PREPARED STATEMENT OF DAVID C. STIMSON

I. INTRODUCTION

Good morning, Mr. Chairman. Thank you for inviting me to testify. My name is 

David Stimson. I am Chief Trademark Counsel for Eastman Kodak Company in 

Rochester, New York where I have been employed for the past 18 years. 

My volunteer activities in the trademark community include service on the U.S. 

Patent and Trademark Office Trademark Public Advisory Committee from 2000 to 

2003 and with the International Trademark Association. I served as INTA president 

between May 1997 and May 1998. My comments here today concerning revision of 

the FTDA, however, are only on behalf of Kodak. 

Kodak supports amending the Federal Trademark Dilution Act (FTDA) 1 to address issues raised by the Supreme Court’s decision in Moseley v. V Secret Catalogue, Inc.2 This decision will hamper the ability of owners of famous trademarks 

like KODAK to protect their intellectual property from third party uses that either 

blur or tarnish. Blurring and tarnishment are the two forms that dilution can take. 

In Moseley, the court said that the owner of a famous mark must wait until there 

is some sort of demonstrable harm before a judge can issue an injunction in a dilution case. The court also raised the possibility that tarnishment of a famous mark 

may not be actionable under the current statute. 

II. THE KODAK TRADEMARK

The FTDA was designed to protect famous trademarks like KODAK. In the nearly 

125 years since it was first coined, the KODAK trademark has been used on billions 

of products and has generated hundreds of billions of dollars of revenue. During 

that time Kodak has employed millions of American workers. Kodak has used the 

KODAK trademark on all its products and in all its advertising, gaining the loyalty 

and trust of hundreds of millions of American consumers over six generations. 
46

3Federal Trademark Dilution Act of 1995, 104 H. Rpt. 374 (referring to dilution by the introduction of KODAK pianos). 4Moseley at 123 S. Ct. 1115, 1123 (2003). 5 ‘‘The 2003 Tech Brand Scorecard’’, Forrester Research, Inc.; Wholeview Technologies Research Brief, October 28, 2003. 6 Robert Siegel, ‘‘All Things Considered’’, National Public Radio, September 25, 2003. 7 Jim Zarroli, ‘‘All Things Considered’’, National Public Radio, September 25, 2003. 

As a result, the KODAK trademark today is one of the strongest and most famous 

trademarks in the United States and around the world. It was even cited by Congress as a famous mark when the FTDA was adopted in the mid-1990s 3 as well 

as by the United States Supreme Court in its Moseley decision.4 Surveys of brand 

value consistently place the KODAK trademark at the top of the list of the world’s 

most valuable trademarks. The Forrester 2003 Technology Brand Scorecard placed 

KODAK number two among 58 major technology brands and number one in terms 

of usage and recognition. KODAK was the number one U.S. brand in the 2002 WPP 

Brandz study that measured consumers’ bonding with over 17,000 brands.5 Independent news reporters have called KODAK ‘‘one of the world’s best known 

brands’’ 6 and have said that ‘‘[f]ew American companies have the kind of brand loyalty and history that Kodak has....’’ 7 So important is the KODAK trademark to 

our company that our CEO Dan Carp has listed ‘‘brand strength’’ as the first among 

our five ‘‘core competencies.’’

Because the KODAK trademark is so important to our company, Mr. Chairman, 

I am grateful to have the opportunity to appear here today and share with the subcommittee the importance of the FTDA to Kodak and to recommend ways in which 

the statute should be revised. 

III. USING THE FTDA TO PROTECT THE KODAK MARK

Just as Kodak has worked hard to establish the KODAK trademark, my colleagues and I work hard to strengthen and protect it. Kodak is proud of the high 

quality of the products and services it offers under the KODAK brand and we spend 

billions of dollars on manufacturing quality and improvements to deliver products 

and services worthy of the KODAK trademark. We also have spent millions of dollars registering KODAK as a trademark, understand its value, and are serious 

about protecting our ownership rights. 

The FTDA has been an important and effective part of our strategy in protecting 

the KODAK brand from blurring and tarnishing uses before it is irreparably damaged. To insure that we are able to take action under the FTDA before the damage 

has become irreparable it is important that Kodak and other owners of famous 

trademarks be able to stop uses that create a likelihood of dilution. For example, 

if we were faced with KODAK Condoms, KODAK Vodka or KODAK Escort Service, 

we would want to act quickly under the FTDA to obtain a preliminary injunction 

and stop these diluting uses at the earliest possible moment. 

IV. THE SUPREME COURT DECISION IN MOSELEY AND ITS IMPACT ON USE OF THE FTDA

In the Moseley decision, the Supreme Court said that the statutory text of the 

FTDA leads to the conclusion that a famous mark owner must prove actual harm 

before a court issues an injunction in a dilution case. Mr. Chairman, an actual harm 

standard seriously undercuts the effectiveness of the statute. 

A trademark embodies the goodwill and reputation of the company that owns it 

and serves as the company’s face to its customers and to the world. Reputations 

take years to build up but can be destroyed instantly, as we have seen all too often 

in the recent corporate and accounting scandals. If a corporation such as Kodak, 

which has built up its reputation over a period of a hundred years through billions 

of individual transactions and interactions with its customers, has to wait until it 

is able to prove actual harm before it can obtain an injunction to stop the dilution 

of its trademark, it would be too late. The damage would be irreparable. 

A requirement that Kodak show actual harm would mean spending months litigating at the potential cost of hundreds of thousands of dollars in legal and survey 

fees. But even more importantly, in the meantime the dilution would continue and 

the value of our trademark would be constantly diminishing at a huge cost that 

could not be calculated. Once the injunction was finally issued, the damage to our 

trademark would already have been done. 

In the real world, once the singularity of a famous mark has been blurred and 

the sterling reputation of the mark has been tarnished, the genie is out of the bottle 

and any court-ordered injunction or damages comes much too late. Our reputation 
47

8 2 Jerome Gilson, Trademark Protection and Practice § 5A.01[6], at 5A–55 (Rel. 50-December 

2003). 9Moseley, 123 S. Ct. at 1124. 

would have been taken over by someone else and, by the time we were able to show 

actual harm, our reputation would never again be ours alone. 

V. KODAK SUPPORTS A LIKELIHOOD OF DILUTION STANDARD

Kodak believes that the best way to assure the effectiveness of a federal dilution 

statute is to specifically incorporate a likelihood of dilution standard into the law. 

Such a standard allows the trademark owner to stop the damage to the distinctiveness of its famous trademark before it becomes irreparable. It insures that the 

singular meaning of the trademark—its unique identification with the trademark 

owner alone and nobody else—will continue. 

I would like to illustrate this point with a hypothetical example that is based on 

real problems that Kodak has faced over the years. Because of the strong and positive reputation of the famous KODAK trademark and because it is so closely identified with photography, our KODAK brand often is used to identify photographs for 

which Kodak has had no involvement or responsibility. 

If Kodak were to be used as the name of a magazine containing photographs of 

child pornography the damage to Kodak’s image as a family-oriented company that 

can be trusted with the pictures and memories of life’s special moments is obvious. 

Obvious too is the damage to the KODAK trademark that would result from this 

misuse. However, if we were required to prove actual dilution, the sales of these 

magazines would continue and proliferate around the country. Even after we had 

shown actual dilution we never would be able to retrieve all those magazines. Our 

KODAK trademark would forever have been associated by everyone who saw those 

magazines with child pornography, not with our company and the products which 

we so proudly sell. 

Granting relief based on a showing of likelihood of dilution is essential for the 

owners of famous trademarks to enable them to quickly stop this kind of serious 

damage to their reputation and goodwill. 

VI. TARNISHMENT, BLURRING, AND THE FIRST AMENDMENT

The Moseley decision also created ambiguity as to the protection that the FTDA 

offers against tarnishment. ‘‘Tarnishment occurs when a famous trademark is 

linked to products of shoddy quality, or is portrayed in an unwholesome or unsavory 

context.’’ 8 The court in Moseley said: ‘‘Whether it [tarnishment] is embraced by the 

statutory text . . . is another question.’’ 9

To remedy this ambiguity, Kodak supports adding to the FTDA an express cause 

of action for likelihood of dilution by tarnishment. 

As long as the KODAK trademark has value there will be dishonest people out 

there who try to take advantage of it to make a quick buck, often in ways that disparage our valuable property. We see all too much of this in the Internet world, 

where unscrupulous scam artists use our KODAK trademark in the domain names 

of websites that tarnish our KODAK trademark and identity. 

Some recent examples are ‘‘kodak.net’’ as the domain name of a website linked 

to a gambling casino, ‘‘kodaq.net’’ for a professional male escort and 

‘‘kodakcompany.com’’ for nude and lingerie models. Under some court decisions it is 

far from certain that such misuses would be held to be dilution by blurring, on the 

dubious ground that once websurfers go to the actual website it is clear what entity 

they are dealing with. 

The FTDA should be amended to make it clear that uses like these, which use 

our trademark in connection with unsavory activities and tarnish its value, constitute dilution. 

If there is a separate cause of action for likelihood of dilution by tarnishment, 

then it is reasonable that Congress also create a cause of action for likelihood of 

dilution by blurring. Whereas tarnishment focuses on a famous mark’s reputation, 

a likelihood of dilution by blurring should address the loss of a famous mark’s distinctiveness, specifically the capacity of the famous mark to stand as an identifier 

for a single source. 

This would address situations in which there is not a direct negative or derogatory connotation from the diluting use, but the second use serves to place into the 

public’s mind an entity other than the original trademark owner. This blurs the distinctiveness of the famous trademark so that it no longer is associated with a single 

source. 
48

We faced this situation several years ago with a company that was using our 

trademark slogan ‘‘A KODAK MOMENT’’ as the punch line for greeting cards that 

it was selling. There was nothing obscene or derogatory about the cards, so they 

would not have been actionable under a tarnishment standard, but they did blur 

the distinctiveness of our KODAK trademark by associating it with the card manufacturer and its joke, rather than with Kodak as the owner of the mark and the 

source of all KODAK-branded products. 

For these reasons, both tarnishment and blurring should be explicitly listed as 

grounds for dilution in the FTDA. 

VII. CONCLUSION

Thank you, Mr. Chairman, for this opportunity to testify. Revising the FTDA is 

a matter of great importance to Eastman Kodak Company. We therefore ask for 

your support in passing the appropriate legislation and your assistance to Kodak 

and other U.S. companies in protecting their valuable trademark assets.

Mr. SMITH. Let me address my first question to all the panelists, 

but I am hoping for a very brief answer. The question is this. It 

is my understanding that the original Congressional intent when 

FTDA was written and passed was, in fact, to try to prevent actual 

damage or actual dilution, not just the likelihood of that. Of course, 

the Supreme Court last year said actual damages had to be proved 

rather than just the likelihood, whereas I think the Congressional 

intent was likelihood would be sufficient to trigger the statute. 

Do any of the panelists have a different view of the Congressional intent based upon their experience or based upon their reading ? Ms. Leimer? 

Ms. LEIMER. No. I think that we certainly believe that from the 

very roots of dilution law, well before even the Federal Dilution 

Act, the concept of dilution was a whittling away of distinctiveness, 

and this is by its nature an incipient kind of harm. 

Mr. SMITH. To me, the committee print is a codification of original Congressional intent, not a divergence from it. 

Ms. LEIMER. And we agree completely with that. 

Mr. SMITH. Mr. Sacoff? 

Mr. SACOFF. Mr. Chairman, if I understood the way you put it 

correctly, I believe you said that the intent behind the original act 

was a likelihood of dilution standard——

Mr. SMITH. That is correct. 

Mr. SACOFF.—and we agree with that assessment. I think that 

the actual reduction to a statutory text raised some questions, and 

I don’t know how many amicus briefs were written in the Victoria’s 

Secret case, but we believe this is a codification. 

Mr. SMITH. The idea was to be able to act prior to the actual 

damage or dilution, not have to wait for that to occur. 

Mr. Johnson, that is a tough question for you, but leaving aside 

the constitutional question, do you at least agree that the original 

Congressional intent was a likelihood standard, not an actual damage standard? 

Mr. JOHNSON. I am not really sure what the Congressional intent 

was with regard to those two standards. I would note, however, 

that the States at that point had some that required actual and 

some that required likelihood, so——

Mr. SMITH. We were trying to clarify that. 

Mr. JOHNSON.—and so it was basically clear that there were at 

least two possibly competing standards. Congress put in the language actual damages, so the only thing I can conclude at that 
49

point is that apparently, given the language, that it was actual 

damages. But I wouldn’t presume to say what was in Congress’s 

mind at the time they enacted the statute. 

Mr. SMITH. All right. And Mr. Stimson? 

Mr. STIMSON. Mr. Chairman, I was involved in some of the drafting of the original statute and the passage of it and I can confirm 

that the intention of that statute was to cover likelihood of dilution. 

Mr. SMITH. Thank you. My next question, Mr. Stimson, is for you 

and Ms. Leimer. In regard to Kodak and in regard to Kraft Foods, 

if we did not have FTDA, what would have happened to your trademarks? And the second part of that is that if we don’t make the 

changes that we propose, what might happen in the future to the 

trademarks of your two companies? Mr. Stimson? 

Mr. STIMSON. Well, I think, as I said in my testimony, the FTDA 

is a powerful tool for us, and that means often not that we necessarily have brought a lawsuit, but it does help us in cease and 

desist letters to stop the dilution at a very early stage, and so it 

has been a very useful means for us to stop dilution, and I can give 

several examples where we have been able to stop dilution before 

it gets to an advanced stage. So I think if we did not have that and 

if we were required to prove actual dilution, then I think we would 

be harmed, and to the extent that the dilution would continue for 

a much longer time, we would be damaged and there would be 

much more court costs for both parties. 

Mr. SMITH. Thank you. Ms. Leimer? 

Ms. LEIMER. We have the very same experience at Kraft that 

Kodak has had. We have some very famous marks and there have 

been a number of instances where third parties have tried to take 

advantage of them. The one most recently where we did have to 

bring a lawsuit was in a case where an individual commercial artist was using the name ‘‘King Velveeda’’ as the trademark for his 

business and his commercial art was sexually explicit. It was available on the website. We have children that visit our website because they like Velveeta. Their moms make their grilled cheese 

sandwiches out of it. And we felt it was very important that we 

preserve the very good name, and so we used the FTDA to control 

that man’s using that name as a trademark for his business. 

Now, if he had said that he didn’t like Velveeta, if he had had 

some issue with the product, the FTDA would not have covered 

that kind of comment. He was using the name as a trademark for 

his business. 

Mr. SMITH. Okay. Thank you, Ms. Leimer. 

Mr. Sacoff, how would you respond to Mr. Johnson’s visual example a while ago of Joe Camel, where he would suggest that the parody would be outlawed or punishable or contrary to law? Do you 

feel that that parody would, in fact, be prohibited or not? 

Mr. SACOFF. Well, I think if I were a judge, I would probably certainly deny a preliminary injunction if it is used in a speech content sort of way. I don’t think the likelihood standard will impinge 

upon free speech in the parody area. First of all, parodies fall within the First Amendment and any Congressional statute obviously 

can’t trump the First Amendment. Courts must apply the FTDA as 

they must apply other statutes in a manner to avoid constitutional 

issues if they can. 
50

We think that the exceptions and the permitted uses stated 

under the FTDA are satisfactory to protect free speech interests, 

and as I said before over the years, I don’t think that the problems 

that the ACLU contemplates have materialized. 

Mr. SMITH. And do you feel under the committee print that aspect of free speech would also be protected? 

Mr. SACOFF. I believe so. 

Mr. SMITH. Okay. Thank you, Mr. Sacoff. 

Ms. LEIMER. Mr. Chairman, I would like to address that, because 

I think the committee print actually expressly excludes the kind of 

example Mr. Johnson used, because under the committee print, the 

dilution cause of action necessarily involves a famous mark being 

compared against the trademark of the other party used to sell 

their goods or services. In this case, it is not being used for that. 

It is clearly being used for parody and for satire and for critical 

comment. 

Mr. SMITH. And that is the intent. Thank you. 

Mr. Berman is recognized for his questions. 

Mr. BERMAN. Let us just follow up on that for a second. Mr. 

Johnson, what is your response to their notions, and I believe Ms. 

Leimer proposed—you proposed a suggested change, I think. 

Ms. LEIMER. In the committee print, the requirement for the action to even be considered is that there be a comparison between 

the famous mark and the challenged mark, but it has to be a mark 

on the challenger’s side being used as a trademark. So if the challenger, if the defendant is using the trademark to make comment, 

it doesn’t even fall within the elements of a cause of action. 

Mr. BERMAN. Could you address whether or not your concern is 

answered by the comments of the other witnesses who reacted to 

it? 

Mr. JOHNSON. Yes, Mr. Berman. The problem is that currently, 

what you have is a non-commercial use exception, essentially—— Mr. BERMAN. Yes. 

Mr. JOHNSON.—and that has been interpreted, unfortunately, 

very, very broadly, so that if any money incidentally happens to 

come into the hands of the person who is using this, it becomes a 

commercial use, according to the courts, or some of the courts, and 

then it loses the protection under the First Amendment that was 

designed under the FTDA. There is really not——

Mr. BERMAN. And tell me, what did Joe Chemo—what was the 

commercial—remind me what the commercial——

Mr. JOHNSON. They sell their magazine. They have a magazine 

where they publish what they call ‘‘subvertisements,’’ which is the 

Joe Chemo, and so they sell their magazine——

Mr. BERMAN. Oh, in other words, people who want to see parody——

Mr. JOHNSON. Right. 

Mr. BERMAN.—advertisements buy the magazine, and in the 

course of their using—I get it. 

Mr. JOHNSON. Right. So essentially, they are profiting from the 

parody, and as a result, as I said, some courts have said that because of their profiting from it, it no longer has that non-commercial aspect. If it is brought—now, what Ms. Leimer said, I think, 

does——
51

Mr. BERMAN. By the way, why isn’t that fair use? 

Mr. JOHNSON. Well, the problem is the fair use exception is only 

for comparative advertising, according to the FTDA. If you broadened to fair use—— Mr. BERMAN. Oh, I see. In other words, if you were knocking Joe 

Camel cigarettes in your commercial, in your advertisement, that 

would be fair use. If you were saying—— Mr. JOHNSON. Right. Under the FTDA, it has to be comparative 

advertising. So if you are comparing your cigarettes with Joe 

Camel, for instance, then clearly that would be comparative advertising and it may be considered fair use. But unfortunately, the fair 

use restriction that is placed in the FTDA is far too restrictive, so 

it doesn’t encompass all of what most people would consider fair 

use. 

Mr. BERMAN. Response? 

Ms. LEIMER. Mr. Johnson is correct that the courts have struggled with the defenses in the current FTDA and there have been 

a couple cases where a distinction was made between commercial 

and non-commercial that perhaps may not be a correct decision. 

The committee print, though, cures that problem. The committee 

print does now require that the dilution action would only apply 

when the other use, the second use, is used as a trademark for that 

party’s goods and services. So anything that falls outside of that is 

not subject. 

Mr. BERMAN. Well, this magazine wasn’t using Joe Chemo as its 

trademark, was it? 

Mr. JOHNSON. No, sir. It was essentially just part of the campaign that they were doing. It wasn’t using it as their trademark. 

Ms. LEIMER. So on—oh, I am sorry, Mr. Johnson. 

Mr. JOHNSON. I was just going to say, the language in the committee print is designation of source. Now, I wasn’t clear exactly 

what designation of source meant when I was reading the committee print—— Mr. BERMAN. I am not, either. What does that mean? 

Ms. LEIMER. Well, it is a somewhat technical term in trademark 

jargon to mean using that word as a trademark, as a designation 

of source. But it is really just using it as a trademark to distinguish your goods and services. 

You were correct when you said, in this case, the magazine was 

not using Joe Camel as the trademark for the magazine and so it 

falls completely outside the realm of the dilution statute as provided in the committee print. It would be, frankly, a matter for 

summary judgment if a plaintiff—if Joe Camel, the owner of that 

trademark, brought this case, because of this change. This is an 

improvement that we think really balances the interests that we 

have been discussing. 

Mr. BERMAN. And do you feel it is an improvement? 

Mr. JOHNSON. I think it is an improvement, but I think what you 

need to do is spell out what you mean by designation of source. 

Since I wasn’t clear what it was, I actually talked to some intellectual property law professors and said, what does this mean to you, 

and they were, like, we have no idea. So clearly, it is not something 

that is easily understood——

Mr. BERMAN. They were patent lawyers. 
52

Mr. JOHNSON.—as to what we mean by designated source, so I 

would make that much clearer than what it is, or at least define 

it within the context of the statute. 

Mr. BERMAN. All right. Two other subjects that I would like to 

just ask about. I don’t know if we are going to have a second round 

or not. 

Mr. SMITH. Go ahead and take your time. 

Mr. BERMAN. I didn’t read the Moseley case. I read a little summary of it. So what if some guy named Victor in Elizabeth Town, 

Kentucky, opens up a store—I don’t know what they were selling 

and whether or not it was lingerie or sex objects or adult magazines or what—and calls itself ‘‘Victor’s Little Secret.’’ I mean, only 

a moron is going to think that is Victoria’s Secret. They may sort 

of catch what the guy is trying to do with his name as an attentiongrabbing device, but so what? So what if some guy named Kodak 

starts an adult magazine that doesn’t violate laws and has pictures 

in that magazine and the magazine is called ‘‘Kodak’’? 

In other words, how far do we go? There is some common sense 

here. What is the big confusion going to mean? How do you know 

that they went on that website because they liked Velveeta cheese? 

I mean, Justice Posner’s skepticism about surveys brings to mind 

my skepticism about polling different aspects, not so much which 

kind they do favor, but the notion of things that go on in your mind 

and your associations, and when people are asked certain questions 

in these surveys, the notion that what they are saying to the survey taker is actually what happened originally. I am somewhat 

skeptical about myself. 

Just whoever wants to get into that, into the Jimmy Carter principle that life is not always fair. Are you guys being hypersensitive? 

Mr. STIMSON. Mr. Berman, may I respond to that, since you used 

Kodak as an example? 

Mr. BERMAN. Yes. 

Mr. STIMSON. I think the problem is that there is this blurring 

and there is this mental association that people will have, that 

they will associate, in your example, the Kodak trademark with 

somebody other than Kodak so that it ceases to become a singlesource designator. When I say I am here this morning to testify on 

behalf of Kodak, you know exactly who I am here for. You are not 

saying, well, are you here for the imaging company? Are you here 

for the porno magazine? That is the kind of problem——

Mr. BERMAN. You are here on behalf of the city fathers of—isn’t 

there a Kodak in Alaska or something? [Laughter.] 

Mr. BERMAN. Kodiak—confusion. 

Mr. STIMSON. The problem here is not a question of confusion but 

it is the question of blurring and diluting the value of the mark 

which does belong to the trademark owner. It no longer signifies 

a single origin or source. 

You also asked about, so what if there is some small store in 

Kentucky? Well, dilution is designed to try to prevent this whittling away, which does start off often in a very small circumstance 

and protect marks in their incipiency before it is too late, before 

things do go to the point where it is impossible to get your reputation back. 
53

Mr. BERMAN. Yes, but Victor’s Little Secret is not Victoria’s Secret. 

Mr. STIMSON. Well, I think one of the factors to look at is the 

similarity of the mark. So that is a question of fact, of whether—

to what extent Victor’s Little Secret is similar to Victoria’s Secret, 

so that would be an issue, just as if somebody were using ‘‘Bokak’’

as opposed to Kodak. That would have to be something that would 

have to be determined. 

Mr. BERMAN. And can one actually tarnish the image of Victoria’s Secret? 

Mr. STIMSON. I won’t get into that. 

Mr. BERMAN. Okay. [Laughter.] 

Mr. BERMAN. All right. 

Mr. SACOFF. From a policy standpoint, your question is a very 

good one, and I think the policy answer or the philosophical answer 

is there are two main areas of trademark law, trademark infringement law, which is based upon fraud and confusion rationales, and 

dilution law, which is not based upon confusion. It is based upon 

quasi-property sort of right and protecting the mark against whittling away by the death of a thousand cuts. 

In trademark infringement law, the answer to your question of 

how far do we go, the limiting factor is confusion. In trademark dilution law, the limiting factor, I think in response to your question, 

is fame. That is how we limit it. That is how we prevent it from 

being a runaway right. You narrow the universe of marks that this 

applies to. It makes a difference, I think, if you open up a phone 

book and look for Kodak and you find one or if you find two dozen 

or three dozen or four dozen. I think that difference has a consequence for the value of the trademark. 

Mr. BERMAN. Can I ask one last question? 

Mr. SMITH. Yes. 

Mr. BERMAN. Three of you, at least, were sure you knew what 

Congressional intent was in the passage of that law. Justice Scalia 

doesn’t even think what we think is Congressional intent counts for 

anything. If that was Congressional intent, why didn’t we write 

‘‘likelihood of dilution’’? 

Mr. SMITH. Unclear language. 

Mr. BERMAN. What was unclear about the language? It didn’t say 

likelihood. It said dilution. And all of you say, notwithstanding 

what we said, this was our intent. I am wondering how you are so 

sure about that. I mean, other than what—I understand you raised 

problems and we responded to it and chose—and since your problems involved likelihood of dilution, the fact that we responded by 

saying dilution, our response must have been wanted to solve your 

problem. 

Mr. SMITH. I was going to direct your question to Mr. Stimson, 

because it sounded like he was an eyewitness based upon his testimony a few minutes ago. 

Mr. STIMSON. Well, I can’t answer directly why Congress did or 

did not do something in 1995. I can agree that the language of the 

statute as it is now is unclear, and that is what has led to this——

Mr. BERMAN. Why is it unclear? It says dilution. I mean, yes, it 

says dilution, right? Causes dilution, not is likely to cause dilution. 
54

Mr. STIMSON. Which is not consistent with my recollection and 

understanding of the intent. So you have a statute that——

Mr. BERMAN. That doesn’t mean that was our intent. It means 

we screwed up, but——

Mr. STIMSON. Well, I was trying to avoid saying that, but——

[Laughter.] 

Mr. STIMSON.—but I think there is a problem with this uncertainty, and that is why we are here today, to ask for language that 

will be clear, to give guidance to the courts and give guidance to 

parties on both sides so that they know the standard is specifically 

likelihood of dilution because the statute is not clear on that. 

Mr. BERMAN. I guess it sounds to me, even more so after hearing 

you, that what you are saying is substitute our clear language for 

the clear language you used before, which is okay, but I don’t think 

we should shoehorn it in to fulfill our original goal by making this 

little technical correction. 

Mr. STIMSON. I guess I would just say I would focus on clarity 

and certainty of results and guidance for people rather than language. 

Ms. LEIMER. Maybe I could just add something. I think INTA has 

certainly been interested in this for many, many years. In fact, way 

back in 1988, there was a proposal from INTA to consider a Federal cause of action for dilution. Speaking with individuals involved 

in that and others outside the association, I think it was very clear 

that the doctrine was an incipient doctrine of dilution. I think there 

was agreement on that. 

I think what perhaps happened was some unfortunate choice of 

language. The language that probably appeared to be clear to represent that concept at the time, turned out, clearly by the Court’s 

difficulty, not to be so clear. 

Mr. SACOFF. Congressman, in the ABA, we had a resolution on 

the eve of the Victoria’s Secret case that said that, on one hand, 

the existing Federal statute should be interpreted by the Supreme 

Court in accordance with a likelihood of dilution standard, and in 

the alternative, if it turned out that it were not interpreted that 

way, that Congress should amend the statute to provide expressly 

a likelihood of dilution statute. 

Mr. BERMAN. When you pass a resolution about the Supreme 

Court should do it, do they follow? 

Mr. SACOFF. Well, they didn’t follow it this time. The resolution 

is simply a policy basis for us to file the amicus curiae brief, which 

we filed, in which we urged a construction which we got one Justice to go along with but not the others, Justice Kennedy. 

Mr. SMITH. Thank you, Mr. Berman. We will hope the Supreme 

Court will see the light of the new language, and that remains to 

be determined. 

This was very informative testimony today. Thank you all. We 

appreciate your time and your attention to a subject that I consider 

to be very important and we will move forward with this committee 

mark, I suspect, in the near future. So thank you all again. 

We stand adjourned. 

[Whereupon, at 11 a.m., the Subcommittee was adjourned.] 
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