Lanham Act puzzles revisited

Mark McKenna’s useful piece on trademark’s history and development argues that trademark traditionally protected property rights, not consumer confusion, as shown most plainly in the limitation of classic infringement to use on competing goods. Courts would deny relief even if confusion was likely when the plaintiff didn’t lose business. He argues, then, that complaints about present-day expansions of the law can’t refer back to a golden age in which trademark law was dedicated to consumer protection and not producer property rights. Instead of appealing to history, critics of expansion have to rely on the normative merits of limited trademark rights. In fact, he suggests, consumer protection models enabled trademark’s expansion because courts were good at finding consumer interests everywhere, even when a trademark owner wasn’t losing sales. Essentially, courts licensed trademark owners to be private attorneys general, protecting consumers wherever consumers might be in need of protection – and even where they weren’t.

On rereading McKenna’s article, I was struck by how well this older model of trademark infringement explains current Lanham Act false advertising law, specifically with respect to standing. Given that the Lanham Act uses the same language for both false advertising and trademark language, it’s a puzzle why there are special standing requirements for false advertising, and yet every circuit employs them (mostly to avoid allowing citizen suits). See Jean Wegman Burns, Confused. Jurisprudence: False Advertising Under the Lanham Act, 79 B.U. L. Rev. 807 (1999).

In false advertising, public deception doesn’t matter if the plaintiff can’t prove that it’s losing sales, which can happen, for example, in a highly competitive market that isn’t dominated by any one seller. McKenna doesn’t actually address false advertising law, but one application of his work is to suggest that the problem isn’t that false advertising standing is too limited, but that trademark standing is far too broad, in that plaintiffs don’t have to show likely loss of sales to prevail.