On October 6, 2006, the Trademark Dilution Revision Act of 2006 (the “TDRA") was signed by President Bush and immediately became effective. The TDRA amended and replaced the Federal Trademark Dilution Act (“FTDA”), which was enacted in 1996.
Designed to protect famous marks from uses that blur their distinctiveness or tarnish their reputation, TDRA clarifies, and in some respects expands, the rights of owners of famous marks and equips them to better succeed in dilution actions. Under TDRA, the owner of a famous mark is entitled to an injunction, among other remedies, against a third party who commences use of a mark or trade name in commerce that is likely to cause dilution of the famous mark, regardless of whether there is actual or likely confusion, competition, or actual economic injury.
• Likelihood of Dilution: the TDRA requires that the plaintiff demonstrate only a likelihood of dilution – a showing of actual dilution, as was required under the FTDA as interpreted by the Supreme Court in Moseley v. V.Secret Catalogue, Inc., 123 S.Ct. 1115 (2003), no longer is necessary
• Fame: to show that its mark is "famous” and thus qualified for dilution protection, the plaintiff must demonstrate that its mark “is widely recognized by the general consuming public of the United States as a designation of source …” (some courts had held under the FTDA that “niche fame,” or fame within a particular industry or segment of the public, would suffice)
• Blurring and Tarnishment: the TDRA explicitly provides protection against both dilution by blurring and dilution by tarnishment (the Supreme Court suggested in Moseley that dilution by tarnishment might not have been protected under the FTDA)
• Descriptive Marks: the TDRA makes clear that descriptive marks with acquired distinctiveness are eligible for protection if famous (the Second Circuit Court of Appeals had held in TCPIP Holding Company, Inc. v. Haar Communications, Inc., 244 F.3d 88 (2d Cir. 2001), that descriptive marks were not eligible for protection under the FTDA)
• Parody: the TDRA expressly excludes liability for “identifying and parodying, criticizing, or commenting upon the famous mark owner or the goods or services of the famous mark owner” (N.B.: the parody exclusion does not expressly exempt parodying or criticism of the famous mark)
Key Features Substantially Carried Over from the FTDA:
• Damages: damages (in addition to an injunction) are available only if the defendant willfully intended to trade on the recognition of the famous mark or to harm the reputation of the famous mark
• Grandfathered Uses: uses that commenced before the plaintiff’s mark became famous continue to be immune
• Exempted Uses: non-commercial uses, uses in news reporting and commentary and fair uses (e.g., fair comparative advertisements)
• Federal Registration and State Dilution Claims: the defendant’s ownership of a federal trademark registration for the mark at issue continues to provide a complete defense to a state law dilution claim