THE TRADEMARK DILUTION REVISION ACT'S NULLIFYING EFFECT ON FAMOUS MARK HOLDER'S DILUTION CLAIMS.

• Author: Bodenbach, Kathleen

INTRODUCTION I. THE RELATIONSHIP BETWEEN TRADEMARK, DILUTION, AND PARODY A. Trademark B. Dilution and Parody II. THE FASHION INDUSTRY A. Limited Legal Protections for Fashion B. Louis Vuitton 1. Parody Protects "Chewy Vuiton" Dog Toys 2. My Other Bag Business Model Also Protected by Parody 3. Louis Vuitton's Unsuccessful Writ of Certiorari to the United States Supreme Court 4. Parodies in the Past and Today III. IMPLICATIONS FOR THE FUTURE CONCLUSION INTRODUCTION

In 1995 the Federal Trademark Dilution Act (FTDA) was passed. The FTDA defined dilution as "the lessening of the capacity of a famous mark to identify and distinguish goods or services." (2) Before 1995, protection against dilution was a state matter that Congress felt was inadequate "because famous marks ordinarily are used on a nationwide basis ... [and] some courts are reluctant to grant nationwide injunctions for violation[s] of state law." (3) Later in 2006, the Trademark Dilution Revision Act (TDRA) amended the FTDA and explicitly provided a fair use defense to dilution for parodies. (4) Notably, parody is not available as a fair use defense when the allegedly invalid use serves as a designation of source. (5)

Meaning that for the fair use parody defense to apply, the parody must not simultaneously operate as a designation of source while acting as a parody. However, courts have largely failed to adequately assess this. Instead, the parody defense's impact has been that once another's use of the famous mark is deemed a parody, then the famous mark holder's dilution claim fails without any meaningful discussion of whether the alleged diluting use is operating as a designation of source. This is frustrating to famous mark holders because, commercially, when trademarks are subjected to mockery or become the butt of a joke, mark holders want to enjoin such harmful uses whenever possible. (6) Today, the TDRA parody exception is strong. Once a use is labeled "parody" there is little opportunity for the famous mark holder to stop the use. (7)

Following the 2006 TDRA amendments, highly creative industries, such as fashion, have been fighting an uphill battle to protect their trademarks that fuel a billion-dollar industry. (8) Application of the TDRA's parody exception showcases the law's failure to adequately protect trademarks in highly creative and competitive industries, such as fashion. While the FTDA sought to protect investments in developing and sustaining famous marks that stretch across the country from devaluation by dilution, the TDRA parody exception carved a hole in the law for almost blanket protection of uses labeled a parody by courts who ignore whether the parody is also a designation of source. Currently, parody is interpreted so broadly that the TDRA's exception makes it difficult for trademark holders to protect their trademarks in all but extreme cases.

This comment will address how the TDRA has left famous mark holders, particularly high-end fashion house Louis Vuitton, with little in its arsenal to prevent others from mocking and devaluing its marks despite its worthy efforts. Part II addresses the relationship between trademark infringement, dilution, and parody. Part III takes a closer look at fashion giant Louis Vuitton's strides to protect its famous marks and the courts' differing approaches to assessing whether a parody exists. Part III also addresses the relationship between parody when it does and does not operate as a designation of source. Part IV offers a discussion of the future implications due to the court's treatment of the parody exception.

1. THE RELATIONSHIP BETWEEN TRADEMARK, DILUTION, AND PARODY

   1. Trademark

      To best understand dilution, it must first be differentiated from trademark infringement, which in turn should be viewed in contrast to patent and copyright infringement. Trademark infringement claims require markedly different elements than copyright and patent infringement claims. (9) In a trademark infringement action, the plaintiff must show that consumers are likely to be confused about a product's source or falsely identify a product as another's product. (10) Copyright infringement claims require a plaintiff to establish ownership of a work and another's unauthorized copying of that work. (11) Patent infringement requires a showing that someone used, sold, or produced a patented work without permission. (12)

      Copyrights and patents protect whoever possesses ownership of the copyright or patent, whereas trademarks focus on consumer protection. (13) Copyright protection seeks to encourage future creative works and patent protection seeks to encourage future inventions. (14) Copyright and patent holders own specific works that, if not protected, may stifle incentives for future creativity and innovation. (15) In contrast, trademarks differentiate products in a market for the sake of consumers. (16) Trademarks do not seek to overtly promote newness and creativity in the way copyright and patents operate. The goal of trademark law is not to promote monopolistic trademarks, rather it is to sustain the freedom and fairness of the marketplace. (17) This is why trademark law largely protects the consumer from confusion, rather than the interests of a producer. (18) Trademark law allows producers to distinguish themselves from one another in the marketplace to prevent consumers from being tricked into purchasing a product posing as another.

      However, in passing the FTDA, Congress saw the need to protect famous marks from their own fame. (19) As a policy matter, Congress concluded that famous marks that become so famous as to not cause customer confusion should not be left without remedy in the law when others take advantage of them. (20) This is largely because a substantial amount of time and money are required to develop a mark into a famous mark and such expenditures should not be left without legal protection. By passing the FTDA, trademark dilution became federally protected and, in contrast to trademark infringement, is similar to copyright and patent infringement because the right is more property-like and protects marks regardless of customer confusion. (21) While trademark infringement is inherently consumer orientated, trademark dilution law is more producer-focused and seeks to prevent the "diminution in the value of a famous mark." (22)

   2. Dilution and Parody

      Dilution protects against the gradual reduction of a famous trademark's ability to operate as a source identifier of a producer. (23) Dilution under federal law is an "association arising from the similarity between a mark or trade name and a famous mark," which either "impairs the distinctiveness of the famous mark," known as blurring, or "harms the reputation of the famous mark," known as tarnishment. (24) Further, dilution law stands in direct conflict with First Amendment speech. Some scholars go as far as to completely reject dilution laws, arguing that they are unconstitutional. (25) Dilution seeks to protect famous marks from speech that impairs the distinctiveness of a mark, while parody is protected First Amendment speech that legally subjects trademarks to ridicule. (26) There is a fine line between ridicule that attacks the goodwill and reputation of a trademark that should be barred by anti-dilution statutes, and ridicule that society deems worthy of First Amendment protection of expression as parody. (27)

      In considering whether dilution by blurring exists courts may consider "all relevant factors" and the FTDA provides six: (1) the degree of similarity between the challenged mark and the famous mark; (2) the degree of distinctiveness of the famous mark; (3) the extent to which the owner of the famous mark is engaging in exclusive use of the mark; (4) the degree of recognition of the famous mark; (5) whether the user of the mark or trade name intended to create an association with the famous mark; and (6) any actual association between the mark or trade name and the famous mark. (28) The FTDA left many unanswered questions for the courts, but particularly: what constitutes a parody? Before 2006, courts developed lengthy case law to establish when to grant an injunction against a parody in the absence of confusion. (29) Courts weighed a multitude of factors including the interests of the public, interests of mark holders, and commercial implications in making their decisions. (30) After 2006, with the passing of the TDRA, the inquiry became much more brief because the TDRA explicitly provided for a fair use exception including "parodying." (31)

      After 2006, courts simply asked whether the dilutive activity constituted a parody. If yes a parody is found, the court asks whether the parody is being used as a source identifier. (32) If the parody does not operate as a source identifier, then the fair use defense triggers and a dilution action cannot be sustained. (33) The TDRA does not define parody, and in practice parody has been...