Summary
Trademark dilution occurs when a use of a trademark by someone other than its owner impairs the mark's distinctiveness, whether or not the mark is used on a competing product or in a way that is likely to cause customer confusion.
A distinction is made between trademark dilution and trademark infringement. Infringement occurs when someone other than a trademark's owner uses the mark in a way that is likely to cause customer confusion. For example, if someone other than the Kodak corporation started marketing film under the mark KODAK, customers would probably be confused, because customers have come to associate KODAK film with a specific source and would probably believe that any KODAK film they see comes from that source.
If however, another company started marketing KODAK brand pianos, there might be little or no customer confusion, because customers would probably recognize that Kodak is unlikely to branch into the piano business or to use its film brand name on pianos. So customers would probably recognize that the KODAK pianos come from a different source. However, the KODAK pianos might still harm Kodak, because it would lessen the strong association, which the company has spent billions of dollars creating, between the word KODAK and film. Some customers, upon seeing the mark KODAK, would no longer instantly think of film—some would think of pianos instead. This lessening of the association between "KODAK" and "film" is trademark dilution.
Many states have long had statutory protection against trademark dilution. Until 1996, federal law protected only against trademark infringement. In that year, the FTDA took effect and provided federal protection against trademark dilution.
Until 2006, the FTDA was distinguished from most state trademark dilution laws in several ways: (1) The FTDA protects only "famous" trademarks; most state statutes do not explicitly require trademarks to be "famous" to be protected against dilution. (2) The FTDA, as interpreted by the Supreme Court, protected only against "actual" dilution of a trademark, whereas most state statutes provided trademark owners with a remedy whenever they could show a "likelihood" of dilution. (3) The Supreme Court suggested (although it did not have occasion to hold) that the FTDA protected only against dilution by "blurring" and not against dilution by "tarnishment" (see below).
Amendments to the FTDA took effect on October 6, 2006. The Act still protects only famous marks. However, Congress amended the act so that it expressly provides protection against a use of a mark that is "likely" to cause dilution. The new statute thus eliminates the requirement of proving "actual dilution."
In addition, the amended statute specifically protects against dilution by "blurring" and dilution by "tarnishment." Dilution by "tarnishment" occurs when association arising from the similarity between a mark or trade name and a famous mark harms the reputation of the famous mark.
Read more about this topic: Federal Trademark Dilution Act
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