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15 U.S.C.S. § 1125
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False designations of origin, false descriptions, and dilution forbidden
Shagandeep Kaur
Business 154: Business Law
Gary Patterson
Research Project
December 10, 2014
Table of Contents
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Title |
Page number |
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I. Introduction |
1 |
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II. Legislation |
1 |
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III. Rationale |
1 |
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IV. Case Analysis |
2 |
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Case 1. |
2 |
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Case 2. |
3 |
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V. Conclusion |
4 |
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a. Social Impact |
4 |
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b. Personal Opinion |
5 |
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References |
6 |
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I. Introduction
The Lanham Act, also known as the trademark act, was enacted in 1946 with the purpose of being a federal trademark statue of law. This law originated so that various merchants are able to maintain their commerce through their reputation and brand without having other competitors take advantage of diluting the brand through similar names or trademarks that impersonate the original merchant. This act is filed under title 15, Commerce and Trade, because it pertains to merchants and their businesses. Chapter 22, Trademarks and general provisions, has this law as a subsection. This paper will be covering § 1125, which deals with false designations of origin, false descriptions, and dilution. The two cases that are covered will go into depth about how the courts interpret the law and whether or not it has a significant impact on commerce.
This topic is of interest to me because it takes many years for a business to build their reputation and brand-worth and another person may try to make money off of that brand even if they have no right to. This usually occurs with high end reputable brands, such as, Gucci, Chanel, Louis Vuitton, Coke, et cetera, when people make knock offs or duplicates of that brand and sell them as genuine. This ends up diluting the brand and is also considered false designation of origin since it’s not the real brand. It’s really tempting to purchase knockoffs of such luxury items but at the end of the day, the people selling those items are infringing on trademarks and can be held liable in court under this Chapter and subsection.
II. Legislation
This law comes under Title 15, Commerce and Trade, and under Chapter 22, Trademarks and general provisions, and under § 1125, false designations of origin, false descriptions, and dilution are forbidden.
15 USCS § 1125
(a) Civil action.
(1) Any person who, on or in connection with any goods or services, or any container for goods, uses in commerce any word, term, name, symbol, or device, or any combination thereof, or any false designation of origin, false or misleading description of fact, or false or misleading representation of fact, which--
(A) Is likely to cause confusion, or to cause mistake, or to deceive as to the affiliation, connection, or association of such person with another person, or as to the origin, sponsorship, or approval of his or her goods, services, or commercial activities by another person, or
(B) In commercial advertising or promotion, misrepresents the nature, characteristics, qualities, or geographic origin of his or her or another person's goods, services, or commercial activities, shall be liable in a civil action by any person who believes that he or she is or is likely to be damaged by such act.
III. Rationale
Looking back at the early civilizations in Egypt, Crete, Greece, or Rome, the use of trademarks can be found (Rogers 1). The use of trademarks back then wasn’t about dilution, as much as it was about making sure to know who had built the product so that if there was something wrong with it, it could be traced back to the seller or maker. These trademarks grew to build trust in brands in the eyes of the public and gave the sellers a reputation, whether it was good or bad. Without the use of these trademarks, it would be hard to distinguish what products you prefer from your previous experiences and would have a bad time second-guessing in markets. Without the use of brand names, there would be no incentive for merchants to do better because the consumer won’t be able to distinguish their product from others. This is the basic idea behind the origins of the Lanham Act of 1946.
The first discussion of the revisions to the federal trademark statues began in 1920 by the American Bar Association and the discussion, which became known as the Vestal Bill, continued on into the 1930s (Rogers 6). The goal was to have the states adapt this trademark statue but the attempts gave mixed results due to various forms being adapted by the states. The statues basically stated that a person could secure their trademark if they planned to use it within 6 months and they would have to pay a fee to register that trademark, which happened to be quite high (Rogers 6). The issue became that even if the states adapted various versions of this statue, there would be too many different statues and it would be difficult to impose one state’s statues in another state. When the Lanham Act draft was formed, it covered four general ideas: 1. Give substantive rights in trademarks to the owners. 2. Preserve the particulars in which experience with the then existing acts had proved valuable. 3. Incorporate the desirable provisions of the Vestal Bill. 4. Carry out the obligations that this country has assumed under international conventions (Rogers 8).
Another purpose was to protect the public, so that it could be confident in buying a product with a trademark that they associated goodwill with, and also to protect the owners of the trademark, who had spent energy, time and money in making the product, from people who would deceive through dilution or infringement. Also, the protection of trademarks fosters competition amongst the brands, which is what the U.S. free market is based upon. The use of trademarks protects the owners and allows their competitors to compete fairly rather than build off of the good will of an established brand through deceit. The Lanham Act was passed on 1946 and since has had more provisions added to protect both the owners of trademarks and consumers. The process for this federal statue was a lengthy one and a deliberate one and has been in use ever since.
IV. Case Analysis
Case 1.
Amazing Spaces, Inc., v. Metro Mini Storage
665 F. Supp. 2d 727; 2009 U.S. Dist. Lexis 89597
Facts: Amazing Spaces sued Metro Mini Storage because they were using the same logo as Amazing Spaces. The symbol, used in Texas, is a star within a circle that the plaintiff had trademarked in 2004. Amazing spaces uses the star logo to stand out from their competitors and alleges that they were the first to use that logo, and therefore, Metro Mini Storage must stop infringing. Metro Mini claims that it’s a common logo, used to represent Texas on an old Texas flag, and therefore cannot be trademarked.
Issue: Is Metro Mini Storage infringing on the Amazing Spaces, Inc.’s trademark?
Law: Under chapter 15 U.S.C.S. § 1125 (a) Civil action (1) Any person who, on or in connection with any goods or services, or any container for goods, uses in commerce any word, term, name, symbol, or device, or any combination thereof, or any false designation of origin, false or misleading description of fact, or false or misleading representation of fact, which--
(A) Is likely to cause confusion, or to cause mistake, or to deceive as to the affiliation, connection, or association of such person with another person, or as to the origin, sponsorship, or approval of his or her goods, services, or commercial activities by another person, or
(B) In commercial advertising or promotion, misrepresents the nature, characteristics, qualities, or geographic origin of his or her or another person's goods, services, or commercial activities, shall be liable in a civil action by any person who believes that he or she is or is likely to be damaged by such act.
Analysis: There is evidence that Amazing Spaces wasn’t the first storage facility, or the only facility, to use the star in a circle logo and in fact 28 other stores have/are using that logo as well. The star within a circle has long been interpreted as a symbol for Texas and therefore is a common symbol that cannot be protected under a trademark. Also, there isn’t enough evidence presented by the Plaintiff to raise a fact issue material to determine if the logo has a secondary meaning besides representing Texas, which further confirms that Metro Mini Storage is not infringing on a trademark.
Conclusion: Court granted summary judgment for the defendant that the logo cannot be trademarked and denied the plaintiff’s motion.
V. Conclusion
a. Social Impact
The goal was to protect the trademarks of the owners of the brands while limiting unfair competition through dilution or infringement. This legislation has been the one that deals with trademark on a federal level and therefore precedes any state statues that may conflict. This legislation has allowed companies to sue other companies for misrepresentations that may hurt them economically as a consequence. For instance, POM wonderful is the maker of pomegranate juice and was able to sue Coca-Cola for misrepresenting their juice as Pomegranate Blueberry when in fact only 3% of the juice was from pomegranate (Duffy 1). Also, in case 1, the Plaintiff was suing because he believed he had a trademark which in fact turned out to be a common good and couldn’t be trademarked and therefore the defendant wasn’t infringing on any trademark by using that symbol.
Also, this legislation allows the owners of trademarks to exercise their rights to their property, the trademarks, by bringing a lawsuit against those who are diluting or infringing upon it. For instance, the plaintiff in the second case had a clear case against the defendant, who was blatantly infringing on the plaintiff’s trademark name, which could cause confusion to the consumers. This has been a successful act because it allows for commerce to continue while setting forth clear standards of what trademarks are and whether someone may be infringing on them and how they can be held liable in court. There isn’t controversy around this law, other than the fact that it is a broad concept when it comes to interpreting it, such as the concepts of “confusion” or “misrepresentation”, and then it is entirely up the court to interpret those words and give their judgment on the cases.
b. Personal Opinion
I am glad that there is such a law at a federal level, because it relieves the owner of a trademark from hardship of having to protect their trademark under different laws set forth by states. Also, if someone has put in their time, effort, and money to come up with a business and a trademark to associate with that business, they should be able to have the rights to use it without having to worry about other people exploiting their trademark. Having this type of protection for a trademark allows the merchant to work harder to build their brand name so that they can become an established and distinguished brand amongst their competitors in the industry. In addition, this act facilitates commerce and fair competition in the market and consequently the consumers are able to get more variety when it comes to choosing products. This law also curves dilution of a brand through knockoffs because it clearly states that if something is similar enough to cause confusion amongst the consumers, such that they might believe there is an association between brand A and brand B, then one of them is infringing on a trademark and must desist or pay damages for infringing.
The only opposition to this law has to be that the statue is left open to interpretation by the courts and the decision can sway either way depending on how strong the prosecution case is and whether or not there are economical damages for which restitution needs to be given. That being said, this law is not one sided. It is actually meant to protect the owners of trademarks, who have worked to build their brand image, and the consumers, who have associated good will or bad will with certain brands and may come under the impression that some similar product is of their favorite brand when it fact it might not be. This law allows for the market to have various types of merchants with different trademarks to go with their companies and allows the consumers to distinguish brands through those trademarks. I believe that it has been one of the most beneficial laws to come by in commerce, besides contracts, because it protects the merchants’ trademark, and therefore preserves the brand.
References
15 U.S.C.S. § 1125, Lexis Nexis. Web. 3 Dec 2014.
Amazing Spaces, Inc. v Metro Mini Storage (2010, CA5 Tex) 608 F3d 225.
Duffy, John. Opinion analysis: The triumph of the Lanham Act (and of federal private rights of action), SCOTUSblog. 13 Jun. 2014. http://www.scotusblog.com/2014/06/opinion-analysis-the-triumph-of-the-lanham-act-and-of-federal-private-rights-of-action/
Rogers, Edward S. "The Lanham Act and the Social Function of Trademarks." (n.d.): 1-12. Law.duke.edu. Web. 6 Dec. 2014. http://tinyurl.com/omebwn8
