Sixteenth Trademark Scholars’ Roundtable Session 3: What is the Significance of Trademark Use 2.0?

Introduction: Mark Lemley:

What VIP actually says: Rogers test insulates from liability when use is only non-source identifying. Cardinal sin is to undermine source-indicating functioning: LV modification of mark in suitcase market implicates the core concerns of TM law. That is a conception of the core of TM law that Lemley thinks is both traditional and right, and also way narrower than what TM law does now, more of a 1960s vision.

There are two different things we call “TM” that are causing difficulties. Classical source confusion: double identity/LOC multifactor test covering similar but not identical marks/goods. That starts to fall apart b/c of the rise of brands, as opposed to TM—the TM is valuable in and of itself. People don’t spend so much on Birkins just b/c of quality—it’s the value of the logo in and of itself. This is real; but we’ve taken it seriously by trying to stretch/mutilate TM law designed for source. We include merchandising, which could be done by a property right, but we don’t admit that, and instead stuff it into LOC by stretching confusion to any sort of connection/affiliation, not considering harm, and stretching the individual digits of confusion. Counterfeiting: post-sale confusion to ignore the fact that no one might be confused at purchase. These built-in elasticities then have lots of other consequences—once we’ve established affiliation confusion w/broad/amorphous tests for confusion, it becomes hard to say that anything is not confusing as a matter of law. Doctrines developed to protect “apex” brands extend everywhere. Pro basketball team that decided to start all games at 7:11 pm—that was a co-branding relationship. If someone else starts all games at 7:11 pm, is that confusing? What if you see a can of Coke in a movie? 30 years ago no student thought it meant anything, now 75-80% of students think there was product placement. Since we don’t require harm, that’s it.

So, what does Article III standing look like? Federal law might actually require more as a constitutional matter. We might want limiting doctrines to say that even if you have a property right, it’s not a right to prevent people from writing/talking about your TM/engaging in comparative advertising/commenting on your TM. IP has traditionally gotten a free pass in 1A law b/c we’ve viewed it as bound up in the classic justification for IP; if the IP we have now is not linked to traditional forms of IP, then that should be revisited. Elster is interesting in that regard.

We could rethink the role of confusion—if the model is property, then consumer confusion isn’t necessarily important. We wouldn’t necessarily ask about whether people think there’s a relationship between two entities but only what the boundaries of the right are. A property right could allow us to recognize that consumers will detect even smallish differences b/t famous marks and variants. We could articulate right to repair, reuse, resell, carry—giving purchase for TM use doctrine to explain what’s in the property right.

Barton Beebe

Providing structures: one proposal is formalism; another is pattern recognition for judges; but those two might be in tension/the second may be harder to reduce to rules. Is TM law becoming post-theory, w/courts just trying to make sure the “right” entity in front of them wins? Is use as a mark a way of doing that?

Questions about relationship b/t analogous use and use as a mark; abandonment—if more & more conduct qualifies as use as a mark, won’t that allow Ps to point to D-side use cases and say “I’m doing at least that much!”

If we should have training for other forms of survey evidence, what would a survey look like that surveys for use as a mark? How would that differ from LOC, distinctiveness surveys? Goes to whether we’re dealing with an autonomous analytical contribution or something else. What about when the D presents evidence that it’s no longer using something as a mark—does it affect remedies?

What about disclaimers? Would “click on this to acknowledge that this is not use as a mark/use as a designation of source” help?

Lisa Ramsey

McCarthy and others say TM use should be taken into account in LOC; she thinks that TM use should be defined narrowly, as in JDI—source-identifying uses. Word “primary” is worrisome though b/c could let affiliation creep in. We should focus on false statements about licensing, affiliation, etc. not implications. Naked licensing: we need some symmetry w/rules about abandonment/enforcement. Only find TM use if it’s ID’ing source or communicating that TM owner is responsible for quality—not just that they’ve given permission.

A lot of the time secondary meaning can overcome a failure to function refusal, but sometimes it can’t—“Drive Safely” for Volvo—that just can’t be a TM. Concerned about rules that require us to have surveys, b/c then only big companies can get rights/defend their uses as TM uses (regardless of whether they should) and small companies can’t (ditto). Better: focus on reasonable consumer. Shouldn’t have a system that requires consumer surveys. [Let me introduce you to 43(a)(1)(B) implied falsity cases!]

Grynberg: Acquired distinctiveness allows us to distinguish Nike from Lettuce Turnip the Beet—looking for where the value was created. If we’re worried about expressive uses, we can ramp up the acquired distinctiveness standard. LTTB and Nike are on opposite ends of the spectrum; we can discuss where to put 100% that Bitch, but courts do want to give rights to Nike and not to LTTB so we should talk about how to create the doctrinal framework.

Students surveyed before teaching TM: Should owner of McD’s mark be able to stop unauthorized use of mark on front of shirt (not on tag)—every year, at least 90% of students say yes. Tries to teach them the reasons why not, but only moves a couple of students a year. We have to accept that judges think this way. When asked: should McD’s control whether a person can set a fictional movie in a McD’s restaurant? Outset of class: students think that McD’s should be able to do so; their normative beliefs change after learning TM law.

Dinwoodie: 1A avoidance doctrine is a useful way to connect the Court with the relevant concerns for Rogers. It will be harder to convince the Court that the Lanham Act is a common-law delegation statute, but lower courts are more open to that.

Lemley: JDI Dct got the message and threw out the survey as not weighty enough.

Dinwoodie: yes, it matters that this was association confusion (at least it matters if we tell the story that this was an association confusion case).

McKenna: TM as exception to free competition is the historical conception, but that’s no longer the view of “brand owners” and judges. Massive expansion of role of large law firms is also part of the story—lawyers involved in writing Lanham Act were experts deeply invested in the TM system. Now though the big players exist to make the big firms richer and more powerful, and deep expertise in the area of law is less important—what the big firms have nailed is the idea of ownership of these marks.

Fromer: Proxies are good b/c they preserve ground for normative values; better than always going directly to consumer perception. Consumer perceptions can be off—consumers might think that source-indicating includes references. Or they might be guided by seeing marks blurred out on TV, believing that permission is necessary to reference marks (goodbye first sale!). We need ways to measure what consumer perceptions stem from, but normative proxies might be better and easier to identify.

Litman: the problem is not that there’s no definition of use in the statute; use in commerce is all over the statute, but rather that it’s narrow in ways people don’t like—affixation to a product for goods is required for infringing use.  And people want to stretch it. [You could use 43(a) “false representation of fact” for many situations and say it wasn’t a “mark,” and the affixation requirement is only for “marks.” I’m not sure how many allegedly infringing uses aren’t really affixed, but it is weird to have that difference b/t goods and services for infringement and not just for acquisition of rights.]

Lemley: elaborates on concept of “apex” brands, which would not be the same thing as fame for dilution. Instead, they’d be the brands for which affixing the TM on something makes it more valuable to people, where the brand itself is what people are seeking—you need sufficient reputation, but Coach and Texas A&M would qualify even though not famous.

Farley: not all “fame” means things are really good source identifiers—they have secondary meaning.

Burrell: Common law lawyers find it really hard to deal with systems that don’t have precedent—reacting to European high courts as if they were binding in other cases even though the definition of distinctiveness keeps changing at that level, whereas Poland and Germany don’t have that problem.

McKenna: is the SCt still a common law court? And how will we figure that out?

In TM, priority disputes are about the amount of use, not the nature of use—it’s about how much latitude you give people to have breaks in use, things that aren’t technically TM use but might create consumer understanding—but those things are bound up in the fact that analogous use cases are about which party is going to own the mark and it will be one of them, not neither of them.