Guilt by Association: Trademark Dilution By Tarnishment

If the Internet has taught us anything, it’s that peddlers of sex-related goods and services recognize few boundaries — including using famous trademarks to drive their own sales. A long-pending case in the U.S. Sixth Circuit Court of Appeals, V Secret Catalogue, Inc. v. Moseley, provides some guidance on how the owners of legitimate trademarks can protect their marks from dilution by tarnishment.

The Case’s Origins

In 1998, the international lingerie company that uses the trade name “Victoria’s Secret” sued Victor and Cathy Moseley. The Moseleys operated “Victor’s Little Secret,” a retail outlet that sold adult videos and novelties as well as lingerie. The company sought an injunction against the use of the name “Victor’s Little Secret” or “Victor’s Secret,” claiming it reduced the positive association and selling power of the Victoria’s Secret mark — a claim known as dilution by tarnishment.

The case went all the way to the U.S. Supreme Court, which held that, under the Federal Trademark Dilution Act, the plaintiff must show actual harm to its mark, rather than just a likelihood of harm.

Congress responded to the decision by passing the Trademark Dilution Revision Act (TDRA), an act providing that the owner of a famous mark is entitled to an injunction against another who uses a mark “that is likely to cause dilution … of the famous mark, regardless of the presence or absence of actual or likely confusion ….”

When the case returned to the district court, it applied TDRA and found a likelihood of dilution by tarnishment. The Moseleys appealed.

A New Presumption

The Sixth Circuit specifically considered whether dilution by tarnishment of a famous mark occurs when a new mark is used to sell sex-related products. It cited eight federal cases in six jurisdictions that have held that a famous mark is tarnished when it’s semantically associated with a new mark used to sell sex-related products. The court found no exceptions in the previous cases.

The court concluded that TDRA created a kind of rebuttable presumption — or at least a very strong inference — that a new mark used to sell sex-related products is likely to tarnish a famous mark where a clear semantic association exists between the two. To avoid an injunction, the owner of the new mark must produce evidence that there’s no likelihood of tarnishment. The Moseleys, however, failed to do so.

Tarnish Remover

The Moseleys may yet seek review of the court’s holding that TDRA seems designed to protect trademarks from any unfavorable sexual associations. Until then, at least in the Sixth Circuit’s view, any new mark with a “lewd or offensive-to-some” association with a famous mark will face a strong inference of tarnishment.

About the trademark law firm:

Klemchuk LLP is an Intellectual Property (IP), Technology, Internet, and Business law firm.  The firm offers comprehensive legal services including litigation and enforcement of all forms of IP as well as registration and licensing of patents, trademarks, trade dress, and copyrights.  The firm also provides a wide range of technology, Internet, e-commerce, and business services including business planning, formation, and financing, mergers and acquisitions, business litigation, data privacy, and domain name dispute resolution. 

Klemchuk LLP hosts Culture Counts, a blog devoted to the discussion of law firm culture and corporate core values with frequent topics about positive work environment, conscious capitalism, entrepreneurial management, positive workplace culture, workplace productivity, and corporate core values.