# Amicus Curiae Brief — Moseley v. v. Secret Catalogue, Inc.

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Amicus Curiae Brief
- **Published:** January 1, 2003
- **Citation:** 537 U.S. 418

## Text

No. 01-1015 AUG 23 202

CRNACE UF PME CLERK

—_—-+- ~ J

IN THE

Supreme Court of the United States

VICTOR MOSELEY., et a/..
Petitioners.
v.

V SECRET CATALOGUE, INC.., et al.
Respondents.

On Writ of Certiorari to the
United States Court of Appeals for the
District of Columbia Circuit

BRIEF FOR AMICUS CURIAE
THE INTELLECTUAL PROPERTY OWNERS
ASSOCIATION IN SUPPORT OF THE RESPONDENT

JOHN K. WILLIAMSON LAURENCE R. HEFTER *
President ELIZABETH MCGOOGAN
RONALD E. MYRICK MAGNUSON
Chair, Amicus Brief FINNEGAN, HENDERSON, FARABOW,
Committee GARRETT & DUNNER, LLP
INTELLECTUAL PROPERTY 1300 I Street, N.W.
OWNERS ASSOCIATION Washington, D.C. 20005-3315
1255 Twenty-Third Street, N.W. (202) 408-4000
Suite 200
. Counsel for Amicus Curiae
patent ey 20037 INTELLECTUAL PROPERTY
OWNERS ASSOCIATION
* Counsel of Record

— (202) 789-0096 — WASHINGTON, D.C. 20001

WILSON-EPES PRINTING CO.., INC.

tc
ver

QUESTION PRESENTED

TABLE OF CONTENTS

QUESTION PRESENTED...
rABLE OF AUTHORITIES ...........
INTEREST OF AMICUS CURIAE.........
INTRODUCTION o.oo.
SUMMARY OF THE ARGUMENT...

ee

lL ACTLAL ECONOMIC HARM IS) NOT
REQUIRED TO PROVE DILUTION..... 7

ll. A “LIKELIHOOD” OF DILUTION IS NOT
irl ctierrnretierteaanannnnananeanenveceses |

lil. CONGRESS CLEARLY STATED THAI
DILLTION MAY BE PROVEN IN A
LL )

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Page

V

TABLE OF AL THORITIES

CASES

hid & ( Vatu lnswers, 233 F.3d 456
th ¢ ON)

Hormel | Corp Jim Henson Prod... l
73 F.3d 497 (2d Cir. 1996

Mattel, In MCA Records. Inc., 296 F.3d 894
th Cir. 2002

Vortellito v. Nina of Califorma, Inc., 335 |
Supp. 1288 (S.D.N.Y 1972

Nabis PF Brands, Inc., 191 F.3d 208 (2d
Cir. 1999

Park N’ Fly. Inc. v. Dollar Park and Fly. b
469 US. 189 (1985)

Ringling Bros.-Barnum & Bailey Combined
Shows, Im Utah Div. of Travel De 1/70
F.3d 449 (4th Cir. 1999 ert. denied, 528

L §. 92371999)

6th Cir. 2001)

STATUTES
IS U.S.C. § 1125(c 4.
15 U.S.C. § 1127

OTHER AUTHORITIES

3 McCarthy on Trademarks and Unfair Com
petition § 24.13{[1]}[a}[i] (3d ed. 1995). :
H.R. Rep. No. 104-374 (1995), reprinted in 1995

Fe dt Re ee
Kathleen B. McCabe, Note, Dilution by Blurr
ine: A Theory Caught in the Shadow of Trade-
mark Infringement, 68 Fordham L. Rev. 1827

od

Pave

H.

+-

4\

IN THI

Supreme Court of the United States

On Writ of Certiorari to the
L nited States Court of Appeals for the
District of Columbia Circuit

BRIEF FOR AMICUS CURTAE
THE INTELLECTUAL PROPERTY OWNERS
ASSOCTATION IN SUPPORT OF THE RESPONDENT

INTEREST OF AMICUS CURIAE

Amicus Intellectual Property Owners Association (IPO) ts a
nonprofit, national organization of nearly- 100 large and
midsize companies and more than 200 small businesses,
universities, inventors, authors, executives, and attorneys who
own or are interested in patents, trademarks, copyrights, and
other intellectual property rights. Founded in 1972, IPO
represents the interests of all owners of intellectual property
The members of IPO’s Board of Directors are listed in

the appendix.

This brief was not authored in whole or in part by counsel tor erther
party. No person or entity, other than amicus Intellectual Property

SE IP REN TOT MOC. Neen | | A

+

IPO and its members have a strong interest in this case
because it represents the Supreme Court's first opportunity to
review and interpret the FTDA. Federal trademark dilution ts
an important new tool that assists trademark owners in
protecting the distinctiveness, value, and usefulness of their
marks. The appellate courts evaluating dilution cases have
come to vastly different conclusions regarding the statute's
scope, meaning, and purpose. Hence, the Court's choice in
this case between the very different interpretations will set
the tone for this statute's future application, determine its
relevance to trademark owners, and provide a guide to those
selecting new trade names and trademarks. [PO submits this
amicus brief to present its view on how the statute should be

properly interpreted.
INTRODUCTION

Relief under the FTDA should not hinge on whether the
owner of a famous and distinctive trademark can prove tan-
gible economic loss or harm at the hands of an unauthorized
user. Such a requirement would impose a daunting standard
that could be rarely met and 1s not supported by the statutory
language. The incalculable value of famous and distinctive
trademarks eligible for protection under the FTDA lies in
their singular uniqueness. Dilution occurs, and should be
enjoined, whenever a famous and distinctive mark (or color-
able imitation), as defined by the statute, is commercially
used without authorization. Whether or not an unauthorized
use inflicts direct and provable economic loss, it inherently
impairs the mark and damages its intrinsic value. It does so
by lessening or “blurring” the mark's capacity to carry out the
central trademark function of identifying a single and unique
source of goods or services.

Owners Association, its members, or its counsel, made a monetary
contribution to the preparation or submission of this brief. The Parties
have consented to the filing of this brief amicus curiae.

3

The very first commerctal use of a famous mark by an
unauthorized third party erodes the famous mark by making it
less unique. Such erosion inflicts an injury on the trademark
owner far more pernicious than mere loss of sales or other
economic injury. Furthermore, allowing the diluting mark to
remain in use invites others to feast on a famous mark's
tremendous value by employing similar uses for their own
benefit at the expense of the originator. Through such
incremental blurring. a mark that was once unique and
famous devolves into the commonplace.

The FTDA was intended to prevent just such progressive
impairment of the intrinsic value of famous and distinctive
trademarks. The Act's remedy, accordingly, should apply
without regard to whether direct economic harm can
he shown.

SUMMARY OF THE ARGUMENT

The FTDA provides a new and unique federal cause of
action that applies whenever the commercial use of a mark
lessens the capacity or ability of a famous and distinctive
mark to serve as a unique identifier of source or lessens its
distinctive quality. The right of relief under the Act does not
require proof of actual economic harm to the trademark
owner. Rather, the Act focuses on the harm to a mark's
intrinsic capacity or ability to distinguish goods or services,
which does not necessarily translate into provable economic
harm to the mark’s valuation. Harm of this nature can
be proven through a variety of methods, such as proof of
contextual factors, circumstantial evidence, or anecdotal
evidence. In some instances, proof of dilution merely
requires proof that the mark used by the defendant is so
similar to the plainuff's famous mark, that i calls the
plaintiff's mark to mind and creates an association. In other
words, commercial activity associating the famous mark with
something other than the right holder, ipso facto dilutes the
mark's distinctive nature.

seen Te eT

4
ARGUMENT

In 1995, Congress created a new and different federal
cause of action when it passed the Federal Trademark
Dilution Act, which became law on January 16, 1996. The
FTDA’s purpose, as shown in its legislative history, was
“to protect famous trademarks from subsequent uses that blur
the distinctiveness of the mark or tarnish or disparage it, even
in the absence of likelihood of confusion.” H.R. Rep.
No. 104-374, at 2 (1995), reprinted in 1995 U.S.C.C.A.N.
at 1029.

This Act represents a clear departure from the traditional
trademark-infringement analysis, which is based on a
likelihood of contusion, deception, or mistake. /d. at 3, 1995
U.S.C.C.A.N. at 1030. Rather, the new dilution statute was
intended to apply “when the unauthorized use of a famous
mark reduces the public’s perception that the mark signifies
something unique, singular, or particular.” /d. As examples
of actions that would dilute famous marks, the legislative
history stated that “the use of DUPONT shoes, BUICK
aspirin, and KODAK pianos would be actionable under this
legislation.” /d.

I. ACTUAL ECONOMIC HARM IS— NOT
REQUIRED TO PROVE DILUTION

As this Court has noted, “Statutory construction must begin
with the language employed by Congress and the assump-
tion that the ordinary meaning of that language accurately
expresses the legislative purpose.” Park N’ Fly, Inc. \
Dollar Park and Fly, Inc., 469 U.S. 189, 194 (1985). The
“language employed by Congress” reads:

The owner of a famous mark shall be entitled, subject to
the principles of equity and upon such terms as the court
deems reasonable, to an injunction against another

5

person's commercial use in commerce of a mark or trade
name, if such use .. . causes dilution of the distinctive
quality of the mark.

1S U.S.C. § 1125(cV 1). The Act further defines “dilution” as

the lessening of the capacity of a famous mark to
identify and distinguish goods or services, regardless ot
the presence or absence of
(1) competition between the owner of the famous
mark and other parties, or

(2) likelihood of confusion, mistake, or deception.

a)

1S U.S.C. § 1127.

Nothing in this statutory text indicates that the capacity or
ability of a mark to identify and distinguish goods and
services is not lessened until proof of a tangible, economic
harm is available. To the contrary, the Act provides that the
owner of a famous mark shall be entitled to an injunction of a
third party's commercial use of a marx if the use causes
dilution of the mark's distinctive quality—not its economic
value. Furthermore, dilution occurs when the capacity of a
famous mark to distinguish the goods or services it identifies
is lessened. That is all a trademark owner need prove under
the Act. A trademark is an intangible asset, and it 1s logical
that damage to it could be intangible as well. Indeed, the Act
specifically contemplates that a noncompeting use of the
famous mark can dilute its distinctive quality. IS U.S.C.
$1127. If two products do not directly compete with one
another, it is not likely that the dilutive use will siphon sales
away from the trademark holder, leading to direct financial
harm. Yet the statute clearly contemplates that such a use can
in fact dilute the strength and significance of a famous mark.

Even the Fourth Circuit, which first advanced the argument
that proof of actual harm was required, conceded that the
requirement “does not leap fully and immediately from the
statutory text.” Ringling Bros.-Barnum & Bailey Combined

pp

6

Shows, Inc. v. Utah Div. of Travel Dev., 170 F.3d 449, 453,
(4th Cir. 1999), cert. denied, 528 U.S. 923 (1999). Thus, the
statutory language itself does not support a claim that proof of
actual injury to the economic value of the famous mark
preconditions any and all relief under the Federal Trademark
Dilution Act.

Petitioners (and some commentators) have suggested that,
unless proof of actual economic harm is read into the FTDA,
it would create a “right in gross” or lead to some kind of
“patent on words,” unlimited in time, that will harm com-
petition and violate the First Amendment of the Constitu-
tion. But such suggestion is misplaced. Under the statutory
scheme, dilution protection requires a three-step process. The
first step determines whether a mark even qualifies for
dilution protection, by focusing on the consumers’ perception
of the mark as a famous and unique indicator of goods and
services. If the trademark owner cannot prove that the mark
is famous and distinctive to the consuming public, then the
mark is not entitled to protection under the statute. 15 U.S.C.
§ 1125(c)(1). Thus dilution protection exists only so long as
a mark is “famous and distinctive” in the minds of the
consuming public.

The second step determines whether the use is in fact
dilutive of the famous mark, while the third step applies
certain statutory exemptions designed to protect the fair use
of the famous mark and First Amendment concerns. 15
U.S.C. § 1125(c)(1), (3). See also, Mattel, Inc. v. MCA
Records, Inc., 296 F.3d 894, 902-07 (9th Cir. 2002) (finding
use of the famous BARBIE trademark in the song “Barbie
Girl” dilutive because it caused consumers to associate two
different products with the mark (the doll and the song), but
protected by the statutory exception for noncommercial (i.e.
constitutionally protected) use.) This fundamental tying of
dilution protection to consumer perception and the specific
exceptions for fair use and constitutionally protected speech

7

limit the scope of protection afforded by the FTDA. As
clearly seen in the Mattel case, a trademark owner cannot
control every use of the mark by third parties. The FTDA
does not create a “patent on words,” but simply protects a
famous trademark by preventing third parties from riding on
its coat-tails, instead of making their own way. Thus, the
statutory scheme set forth by Congress, taken as whole,
balances the protection of consumers, competition, trademark
owners, and free speech—without requiring proof of an
economic injury.

ll. A “LIKELIHOOD” OF DILUTION IS NOT
SUFFICIENT

Some appellate courts appear to advocate that a “likeli-
hood” of dilution is ali that is necessary to receive relief
under the FTDA. Eli Lilly & Co. v. Natural Answers, 233
F.3d 456 (7th Cir. 2000); V Secret Catalogue v. Moseley, 259
F.3d 464, 474-76 (6th Cir. 2001). This suggestion should
be rejected as well. The statutory language is unambig-
uous—the mark’s use must “cause dilution.” 15 U.S.C.
§ 1125 (c)(1). But this language does not suggest that causa-
tion can only be proven through an economic calculation or
an empirical measurement rathe> than from common sense,
an understanding of the natural consequences of an action, or
other types of logical proof or market evaluations.

Use of the term “likelihood” of dilution in the above deci-
sions is really an unfortunate choice of words. In both cases,
the circuit courts correctly understood and applied the
concept of “dilution” per se. Eli Lilly recognized that
“{d]ilution by blurring, the injury at issue here, occurs when
consumers ‘see the plaintiff's mark used on a plethora of
different goods and services,’ . . . ‘raising the possibility that
the mark will lose its ability to serve as a unique identifier of
the plaintiff's product.’” 233 F.3d at 466 (quoting Hormel
Feods Corp. v. Jim Henson Prod., Inc., 73 F.3d 497, 506 (2d
Cir. 1996), which quotes 3 McCarthy on Trademarks and

8

Unfair Competition § 24.13[1][a][i] (3d ed. 1995))). Simi-
larly, the Sixth Circuit understood that unauthorized commer-
cial use of a famous mark causes actual dilution when it
concluded that “[t)his, then, is a classic instance of dilution by
tarnishing (associating the Victoria’s Secret name with sex
toys and lewd coffee mugs) and by blurring (linking the
chain with a single, unauthorized establishment). V Secret
Catalogue, 259 F.3d at 477.

But in describing the new concept of dilution, these courts
clung to the familiar by using the language of trademark
infringement. This unfortunate choice of words is not unus-
ual in dilution analyses. See Kathleen B. McCabe, Note,
Dilution-by-Blurring: A Theory Caught in the Shadow of
Trademark Infringement, 68 Fordham L. Rev. 1827, 1850-54
(2000) (discussing how “[clourts frequently decide dilution
claims using the language of infringement standards, resulting
in a miscommunication of the court’s analysis of the law”).
However, the courts’ use of the words “likelihood of —the
flagship words of infringement analysis—does not neces-
sarily suggest that their underlying analysis was incorrect.
Indeed, in each case, dilution of the famous mark was
actually present and occurring. The courts simply used cir-
cumstantial and contextual factors rather than proof of
tangible economic harm to determine whether or not the
alleged activity caused dilution of the famous mark. See
Nabisco v. PF Brands, Inc., 191 F.3d 208 (2d Cir. 1999) (“If
a junior user began to market Buick aspirin or Schlitz shellac,
we see no reason why the senior users could not rely on
persuasive circumstantial evidence of dilution of the
distinctiveness of their marks without being obligated to show
lost revenue or engage in an expensive battle of surveys.
Plaintiffs are ordinarily free to make their case through
circumstantial evidence that will justify an ultimate inference
of injury. ‘Contextual factors’ have long been used to
establish infringement. We see no reason why they should
not be used to prove dilution.”).

9

Ill. CONGRESS CLEARLY STATED THAT DILU-
TION MAY BE PROVEN IN A NUMBER OF

WAYS

Dilution is a concept that courts have struggled with since
it was first described, because it differs significantly from
traditional trademark analysis. But once one accepts that
dilution provokes the need for a different remedy, and was
enacted to guard against a different harm, the concept
becomes quite simple.

In adopting the dilution statute, Congress accepted the
proposition that, absent some mitigating or equitable factors,
the actual and inevitable result of a third party’s use of a
famous mark on different goods or services is the lessening of
that mark’s capacity to serve as a unique identifier of source.
This approach to the proof of dilution is shown by several
statements made throughout the legislative history. First, the
legislative history noted that passage of the FTDA “would ...
create a federal cause of action to protect famous marks from
unauthorized users that attempt to trade upon the good will
and established renown of such marks and, thereby, dilute
their distinctive quality.” See H.R. Rep. No. 104-374, at 3
(1995), reprinted in 1995 U.S.C.C.A.N. 1029, 1030 (em-
phasis added). The legislative history went on to note that
“{t]he concept of dilution recognizes the substantial invest-
ment the owner has made in the mark and the commercial
value and aura of the mark itself, protecting both from those
who would appropriate the mark for their own gain.” /d.

This interpretation is reinforced by the legislative history's
listing of “DUPONT shoes, BUICK aspirin, and KODAK
pianos” as actual examples of dilutive uses. /d. Indeed, the
language used in the report—that “DUPONT shoes, BUICK
aspirin, and KODAK pianos would be actionable under this
legislation,” underscores Congress’s acceptance of the prop-
osition that the third party’s unauthorized commercial use of
a mark itself blurs, and thus dilutes, the distinctive quality of

10

the mark. /d. (emphasis added.) These examples were not
listed as ones that might be actionable if the trademark owner
could prove actual economic harm; they were listed as
examples of dilution itself.

Furthermore, Congress provided for injunctive relief,
which is intended to prevent irreparable harm, if the
unauthorized use of a famous mark causes dilution of its
distinctive quality. 1I5 U.S.C. §1125(c)(1). Requiring
proof of actual economic harm is_ inconsistent with
Congress’s intent when it selected injunctive relief as the
primary remedy.

Finally, the legislative history’s clearest explanation of
dilution comes from its quotation of Mortellito v. Nina of
California, Inc., which stated:

Dilution is an injury that differs materially from that
arising out of the orthodox confusion. Even in the
absence of confusion, the potency of a mark may be
debilitated by another’s use. This is the essence of
dilution. Confusion leads to immediate injury, while
dilution is an infection, which if allowed to spread, will
inevitably destroy the advertising value of the mark.

335 F. Supp. 1288, 1296 (S.D.N.Y 1972). These explana-
tions of dilution make clear that proof of immediate and
quantifiable harm is not required to establish that an
unauthorized use of a famous mark causes dilution. Rather,
dilution occurs when a set of facts takes place, namely, the
commercial use of a mark by another, which lessens the
ability of a famous mark to serve as a unique identifier of
source. Indeed, dilution of a mark’s “distinctive quality” is
diminished immediately upon commercial use by an unre-
lated third party—regardless of how imperceptible or seem-
ingly inconsequential the initial effect may be.

1]
CONCLUSION

The plain language of the statute’s text, the legislative
history (which reflects Congress’s intent), and the underlying
rationale for dilution all clearly show that proof of actual
economic harm to the famous mark is not required to prove
dilution. Rather, dilution occurs, and may be enjoined,
whenever a third party commercially uses a famous and dis-
tinctive mark (or colorable imitation) without authorization.

For the reasons set forth above, amicus curiae Intellectual
Property Owners Association respectfully requests that the
Court affirm the judgment of the Court of Appeals.

Respectfully submitted,

JOHN K. WILLIAMSON LAURENCE R. HEFTER *
President ELIZABETH MCGOOGAN
RONALD E. MYRICK MAGNUSON
Chair, Amicus Brief FINNEGAN, HENDERSON,
Committee FARABOW, GARRETT
INTELLECTUAL PROPERTY & DUNNER, LLP
OWNERS ASSOCIATION 1300 I Street, N.W.
1255 Twenty-Third Street, N.W. Washington, D.C. 20005-3315
Suite 200 (202) 408-4000

preg gn a 20037 Counsel for Amicus Curiae
(202) 406- INTELLECTUAL PROPERTY

* Counsel of Record OWNERS ASSOCIATION

la

APPENDIX
Members of Board of Directors,
Intellectual Property Owners Association *
Marc §. Adler Stephen P. Fox
Rohm and Haas Co. Hewlett-Packard Co.
Robert A. Armitage Scott M. Frank
Eli Lilly and Co. BellSouth Corp.
Frederick T. Boehm Gary C. Ganzi
IBM Corp. U.S. Filter Corp.

Eduardo M. Carreras
Coca-Cola Co.

Angelo N. Chaclas
Pitney Bowes, Inc.

Howard N. Conkey

General Motors Corp.

William J. Coughlin
Ford Global
Technologies, Inc.

Dan Crouse
Microsoft Corp.

Gerald V. Dahling

Aventis Pharmaceuticals

Inc.

Frampton E. Ellis, Ill

Bernard J. Graves, Jr.
Eastman Chemical Co.

Gary L. Griswold
3M Innovative Properties Co.

John M. Gunther
EMC Corporation

Jack E. Haken
Koninklijke Philips

Electronics N.V.

Harry J. Gwinnell
Cargill, Inc.

J. Jeffrey Hawley
Eastman Kodak Co.

Stephen D. Harper

Anatomic Research, Inc. Henkel Corp.
Marc D. Foodman Robert P. Hayter
Sun Microsystems, Inc. United Technologies Corp.

* IPO procedures require approval of positions in briefs by a three-
fourths majority of directors present and voting.

William B. Heming
Caterpillar, Inc.

Dennis H. Hoerner, Jr.
Monsanto Co.

Philip S. Johnson
Johnson and Johnson

Wayne A. Jones
SAP, A.G.

Mark P. Kesslen

JP Morgan Chase & Co.

Charles M. Kinzig
GlaxoSmithKline

Michael K. Kirschner
Amgen, Inc.

Richard F. Lemuth
Shell Oil Co.

Edward L. Levine
Alcoa, Inc.

Michael L. Lynch

Micron Technology, Inc.

William F. Marsh

2a

Steven W. Miller
Procter & Gamble Co.

Raghunath S. Minisandram
Seagate Technology, LLC

Ronald E. Myrick
General Electric Co.

Wallace L. Oliver
BP America, Inc.

Richard F. Phillips
ExxonMobil Corp.

Marcia D. Pintzuk
FMC Corp.

Thomas C. Reynolds
Intel Corp.

Vernon R. Rice
E.1l. DuPont de Nemours
& Co.

Peter C. Richardson
Pfizer, Inc.

Allen W. Richmond
Phillips Petroleum Co.

Robert R. Schroeder

Air Products & Chemicals, Inc. Mars Incorporated

Jonathan P. Meyer
Motorola, Inc.

Mark T. Starr
Unisys Corp.

Brian W. Stegman
BASF Corp.

Graham &. Taylor
Dow Chemical Co.

3a

Herbert C. Wamsley
Intellectual Property Owners
Assoc.

John K. Williamson
PPG Industries, Inc.

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385014_0535%3A19. Public record. Not legal advice.