Tuesday, October 16, 2012

Permission of Federal Dilution Claims Against Validly Registered Federal Trademarks in the Works - Update

We previously reported on the proposed amendment to the Trademark Dilution Revision Act, H.R. 6215 (on Aug. 9), which would amend the Lanham Act relating to the effect of federal trademark registration on state law claims. 

The bill passed the U.S. House of Representatives on September 11 and, on September 12, was referred to the Senate Committee on the Judiciary. The full Senate passed the bill on September 21, and it was signed into law on October 5.

The House Committee on the Judiciary issued a short report on the bill (Report 112-647) stating that the bill is intended to clarify that federal trademark registration “only constitutes a complete bar to a state claim based on dilution, or actual or likely damage or harm to the distinctiveness or reputation of a mark.” 

The report provided a brief history of the Trademark Dilution Revision Act and described how the error appeared in the law. In short, the report stated that the Senate reformatted the House version of the Trademark Dilution Revision Act “in such a way as to create a bar against state action claims for dilution as well as a state or Federal action based on a claim of actual or likely damage or harm to the distinctiveness or reputation of a mark.” 

The report concluded:

Congress could not have intended such an outcome. If all dilution claims, including Federal claims, are barred by registration, it becomes difficult to cancel a diluting mark that is registered. This only encourages illegitimate mark holders to register diluting marks, which forces legitimate mark holders to expend greater resources monitoring registrations as well as other marks being used in commerce.

The correction to the federal trademark law by H.R. 6215 would apply to any action that commenced on or after the date of enactment of the law.

This article was prepared by Sue Ross (sross@fulbright.com / 212 318 3280) of Fulbright’s Intellectual Property and Technology Practice.