Ejwp0207 7

TRADEMARK LAW AND SOCIAL NORMS Graeme B.
Dinwoodie* Introduction At the most general level, trademark law is classically motivated by the goal of protecting understandings that consumers have developed regarding the source or quality of goods or services.1 In effectuating that goal, it becomes crucial to determine the associations that consumers develop with respect to symbols for which trademark protection is claimed, as well as consumer reaction to unauthorized uses of those or similar symbols by third parties. Unless those third party uses disturb consumer understandings, they do not implicate the classic purposes of trademark law, and thus trademark law can defer to the default premises of free competition and free speech that underlie our democratic, market-based economy. This is a rather simple, if conventional, account of trademark law.2 In fact, contemporary uses of trademarks implicate a far more complex set of social concerns than the protection of consumer understanding.3 But even this simple statement of the purpose and remit of trademark law begs many questions. These questions fall into two basic groups. First, because trademark law does not seek to prevent all forms of confusion,4 the consumer protection rationale presents a series of essentially
*
Professor of Law, Associate Dean, and Director, Program in Intellectual Property Law, Chicago-Kent College of Law; C hair in Intellectual Property Law, Queen Ma ry College, U niversity of Lon don . Copyright 2007, Graeme B. Dinwoodie. Thanks to Tim Holbrook, Cynthia Ho, Mark Janis, Hal Krent, Mark Lemley, Stacey Dogan, Brett Frischmann, Kathy Strandburg, and Kathy Baker for critical discussion of some of the ideas pursue d in this paper. The paper also benefitted from com ments from participants in a number of faculty workshops and seminars, including those at Bo alt Hall Law School, Stanford Law School, University of Cincinnati College of Law, Northwestern University School of Law, Boston College Law Scho ol, Indiana U niversity School of Law, U niversity of Arizo na College of Law, University of T oronto Centre for Innovation and P olicy, and the MaxPlanck-Institute for Intellectual Property, Tax and Com petition Law, M unich.
1 See, e.g., Qualitex Co. v. Jacobson Prods., 514 U.S. 159, 163-64 (1995); S. Rep. No. 1333, 79th Cong., 2d Sess. 3 (1946); Stephen L. Carter, The T rouble With Tradem ark , 99 Y ALE L.J.759 , 759 (1990); William M. Landes & R ichard A. Posner, Trademark Law: An Econ omic Perspective , 30 J.L. & E C O N . 265 (1987); W ILLIAM L A N D E S A N D R IC H A R D P O S N E R , T H E LA W A N D E C O N O M IC S O F I NT ELLEC TU AL P R O P ER T Y L A W (2003). 2
See infra text accompanying notes __-__ (developing a fuller theoretical account).
See Alex K ozinski, Trademarks Unplugged , 68 N.Y.U. L. R EV . 960 (1993). Even having regard only to historical uses of marks, these concerns would include competing philosophical commitments to paternalism, free market competition, and free expression (to name but a few). See William R. Warner & Co. v. Eli Lilly & Co., 265 U.S. 526, 528 (1924); KP Permanent Make -Up, Inc. v. Lasting Impression I, Inc., 543 U.S. 111 (2004).
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TRADEMARK LAW AND SOCIAL NORMS
prescriptive questions regarding the nature and level of confusion that should be actionable, along with the forms of consumer understanding that are properly protected against such confusion.5 And, once those prescriptive choices are made, trademark law confronts a second set of questions that on their face are more positivistic dilemmas: how to determine consumer reaction to a symbol used purportedly to mark goods (the question of protectability, or distinctiveness) and the effect of unauthorized third party use of that symbol (the question of infringement, classically involving assessment of the likelihood of confusion). These inquiries have the appearance of purely empirical assessments,6 and indeed doctrine regarding distinctiveness and likelihood of confusion is heavily driven by the factual context of particular disputes that have reached the courts.7
See, e.g., 15 U.S.C. 11 25(a) (1988 )(rendering actionable confusion as to affiliation, endorsem ent, sponsorship or connection); A&H Sp ortswear, Inc. v. Victorias Secret Stores, Inc., 237 F.3d 198 (3d Cir. 20 00) (reverse co nfusion actionable); Ferrari S.P.A. Esercizio v. Roberts, 944 F.2d 1235 (6th Cir. 199 1) (post-sale confusion actionab le); Playboy E nters., Inc. v. Netscape Com ms. Corp., 354 F.3d 1020 (9th Cir. 2004 ) (initial interest confusion actionable). Of course, as critical scholars of evidence and procedure have shown, the form in which courts pursue fact-finding clearly involves value judgments. To be sure, the principal values at issue in how co urts make em pirical assessments in trademark disputes are o ften value s not unique to trademark law, but instead reflect more fundamental commitments to a particular type of legal system. Howeve r, facts are not proved the same way in all disputes and those differences often reflect substantive policy preferences. Moreover, the connection between facts and doctrine is crucial, as explored in this Article. Rule-based approaches to trademark law might require a different intensity of fact finding than a standards-based approach. If particular conclusions assume deterministic weight, we might be less willing to settle for assessment of other than substantial probativeness. Conve rsely, if certain facts can only be determined in very ap proximate terms, o r have in-built circularity, trademark law may opt for a doctrinal approach rooted in multi-factor standards that are informed by a numbe r of less certain factual determinations. (Of course, if a fact is wholly indeterminate, one might also question whether any reliance should be placed on it). The factual determinations that undergird trademark law are notoriously uncertain, suggesting a generalized preference for standards. See Graeme B. D inwoo die, Confusion Over U se: Con textualism in T radem ark Law , 92 I OWA L. R EV . ___ (2007)(forthcoming)(expressing preference for a standards based approac h); see generally Cass Sunstein, The Problems with Rules, [cite]; See Louis Kaplow, Rules Versus Stand ards: An Eco nom ic Analysis , 42 D UKE L.J. 557 (19 92). The extent to which conclusions by co urts rega rding consumer assoc iation (either in particular cases, or in providing the basis for a rule of law) are, or need to be, grounded in empirical assessm ents of consumer behavior is an important issue in trademark law, but one tha t courts have not carefully addressed . See Graeme B. D inwoo die, The Seventh Annual Honorable Helen Wilson Nies Lecture in Intellectual Property Law: The Trade mark Jurisprud ence o f the Rehnquist Court , 8 M ARQ . I N TELL . P R O P . L. R EV . 187 (2004); Graeme B. D inwoo die, Reconceptualizing the Inherent Distinctiveness of Prod uct De sign Trade D ress , 74 N.C. L. R EV . 471 (1997 ). Although this article criticizes over -reliance on empirical assessments (espec ially ones that are mere suppositions), how these basic empirical questions are addressed remains an important concern for trademark law. Because while the empirical reality should not dictate the normative agenda of trademark law, the central norm ative co ncern of trademark law canno t efficiently be implemented without attention to social reality. Thus, scholarly work must continue in refining the best means of making such
7 6
Courts in trademark cases devote substantial time developing doctrinal rules designed to facilitate this second set of empirical inquiries, but rarely discuss the prescriptive questions upon which the empirical inquiries are based. Of course, this might, to some extent, reflect judicial deference to the more explicitly prescriptive institutional role of legislators as law-makers. Putting aside an entire century of scholarship undermining this romantic deception, judicial modesty has particularly little explanatory force in the context of U.S. trademark law, which has always been a product of the common law. Trademark statutes are understood as schemes to acknowledge and confirm the existence of common law rights, and the current statute (the Lanham Act) retains that general approach.8 A more persuasive explanation flows from focusing on the manner in which courts implement the classic consumer protection rationale for trademark law described above. Courts typically treat consumer understanding as a largely pre-determined, relatively fixed, fact to which the template of trademark law can be applied and from which, therefore, the answers to the relevant legal questions of association and confusion easily provided.9 This Article challenges this dominant analytical approach to trademark lawmaking as descriptively false and prescriptively harmful. The descriptive account masks important prescriptive choices that courts are making about trademark law without any explicit discussion of those choices. Thus, the prevalent form of trademark decisionmaking prevents proper development of a normative debate about the nature and scope of trademark law. To highlight the nature of the descriptive flaws and prescriptive perils of this
assessments, even though they may properly (under my approach) have less deterministic force in setting the boundaries of trademark law. Moreover, this reduction in the subservience of trademark law to empirical reality may reflect either a normative vision that subordinates the value of that reality to another compe ting social value, see infra Part __, or may reflect the fact that the efficient administration of justice requires that we forego micro -level asse ssmen ts of reality. See Robert G. Bone, Enforceme nt Costs an d Trad ema rk Puzzles , 90 V A . L. R EV . 2099 (2004); Dinwoodie , supra note __, at __. See Robert C. Denicola, Some Thoug hts on the Dynamics of Federal Trademark Legislation and the Trad ema rk Dilution Act of 1995, 59 LAW & C O N TE M P. P R O B . 75, 79-80 (1996) (Putting aside statutory innovations d irectly linked to the public notice provided by the Act's registration system, the Lanham Act co difie[d] the ba sic common law principles governing both the subject matter and scope of protection.). The Lanham Act did depart fro m co mmon law in some resp ects, see Graeme B. Dinwoodie, The Story of Kellogg v. Nationa l Biscu it Com pan y: Breakfast with Brande is , in I NTELLECTUAL P R O P ER T Y S TORIES 220, 240-41 (Dreyfuss and Ginsburg eds. 2005), and since then the act has gro wn further beyo nd co mmon law princip les. See, e.g., Trademark Law Revision Act of 1988, P ub. L. No. 100-667 , 102 Stat. 3935 (198 8). See Graeme W . Austin, Fair Use: Tolerating Confusion in Trademark Doctrine in T RADEMARK L A W A N D T HEORY : A H A N D B O O K O F C ONTEMPORARY R E S EA R C H (Dinwoo die and Janis eds. 2007) (forthcoming) (noting and bemoaning this tendency).
9 8
approach, I explore the insight that scholars and courts are insufficiently attentive to whether trademark law should simply react to consumer behavior or whether instead the law should proactively seek to influence and construct consumer (and producer) behavior.10 Stated differently, what is the relationship between trademark law and the social norms by which trademark law purports to be guided? For example, one could consider whether, and in what ways, the principle of territoriality in trademark law warrants revision in light of digital communication technologies and free trade, both of which enable goodwill and consumer understandings to develop in patterns that increasingly do not correspond to established political or economic units. In particular, should we allow trademark rights to conform consciously to the territorial reach of goodwill? This (reactive) approach would elevate social and commercial patterns of activity as the defining instruments of the scope of rights rather than require rights to conform to the territorial reach of sovereign political institutions that control economic policy.11 This reactive approach would be driven by the general consumer-protection purposes of trademark law, but would be superficially non-normative beyond that core and largely unquestioned general commitment. The normative content of such an approach would, however, lie beneath the surface in its implicit surrendering of the more particularized normative agenda to positive characterizations of social practices, which might be viewed as a preference for superficial notions of market freedom over more humanist notions of consumer autonomy and attention to nonmarket political values. Alternatively, if priority were explicitly given to making an orderly transition to global markets or the continued economic viability of co-existing local markets, policymakers might decide to focus efforts on the development of multinational trademark registration mechanisms that enable more transparent acquisition of rights. This latter (proactive) approach, which is more explicitly normative, would discount some level of consumer confusion in order to effectuate competing goals of commercial certainty and economic development.12
See Graeme B. D inwoo die, Trademarks and Territory: Detaching Trademark Law From the Nation-S tate , 41 H O U S TO N L. R EV . 885, 889-890, 961-963 (2004); Graeme B. Dinwoodie, The Seventh Annual Honorable Helen Wilson Nies Lecture in Intellectual Prop erty Law : The Tradem ark Jurisprud ence o f the Rehnquist Court , 8 M ARQ . I NT ELL . P R O P . L. R EV . 187, 209 (2004).
11
10
See Dinw ood ie, supra note 10, at __-__.
Thus, this choice of whether trademark law should adopt a reactive or proactive approach toward refinem ent of the territoriality principle played itself out, for example, in determining the app ropriate notion of use sufficient to acquire rights in the United States, and in how to develop further internation al systems of registration and enforcement. See id. at 961-963.
12
But the basic choice about whether trademark law (and its analytical vehicle, the consumer) should be constructed proactively, or whether social and commercial norms should be permitted to define the consumer and thence be validated by trademark law, pervades, or should pervade, modern trademark law. Thus, this Article explores this policymaking choice thematically in a number of contexts.13 Phrased in the language of trademark law and norms, the Article argues that trademark law does influence social norms, the ways in which consumers shop, producers sell, and rival traders compete. This is, of course, hardly a radical observation. Law is part of social context, and thus any contextual understanding of law recognizes the dynamic relationship between law and social behavior. However, I argue that trademark law in many ways consciously seeks to shape consumer and producer behavior, not just through its presence as a social and cultural force. Numerous doctrines and much case law embodies clear normative choices, even though trademark courts rarely admit their lawmaking activity. Revealing the normative choices that courts already make in trademark law will, it is hoped, facilitate the more explicit articulation by courts of policy choices in both those areas where courts are making choices and in others where trademark law would benefit from a fuller debate about competing values. Prescriptively, trademark theory and trademark policymaking are unduly constrained by purported norms of consumer and commercial behavior, without sufficiently recognizing that trademark law actually constructs many of those norms. This is not to say that trademark law should decouple itself from the protection of consumer understandings; quite to the contrary, consumer protection should remain central to the development of trademark law. Rather, the development of trademark law should not be, nor be debated as though it were, entirely grounded in the empirics of shortterm consumer understanding. Instead, trademark law should consciously address more proactively the construction of the consumer (and the producer) in pursuit of broader policy objectives. And when trademark law develops in this fashion, those developments should not be dressed up as merely reflective of consumer association. A more proactive approach to the construction of trademark law will reduce the path dependence of changes in trademark law, and allow for proper discussion of competing costs and benefits. Courts would be able to develop trademark law in accordance with clear policy objectives, rather than being driven off-course by policy proxies that cannot withstand challenge or, inappropriately are applied in later factual settings. Finally, it would explicitly introduce into trademark law a balancing of values that is prominently seen in copyright law, but that is largely ignored in
13
See also Dinw ood ie, supra note _ _, at __ (discussing in co ntext of KP Permanent).
trademark law.14 This would help recognize the genuine multivalence of trademark law. I. CONVENTIONAL JUSTIFICATIONS FOR TRADEMARK LAW AND LEGAL REFORM Trademark rights are now firmly recognized as an integral part of the worlds trading system allowing significant economic actors to invoke international law limits on encumbering trademarks to privilege their economic activity and to limit the ability of the state to regulate that activity. 15 The volume of trademark litigation16 and the extent to which domestic and international economic activity revolves around trademark right, confirm this characterization.17 Yet, despite its economic importance, trademark and unfair competition is a remarkably under-theorized area of law.18 This is particularly surprising given that
14 See Graeme B. D inwoo die, The De ath of Ontology: A Teleological App roach to Tradema rk Law , 84 IOWA L. R EV . 611, 712 -18 (1999). 15
See Remarks of Brad Smith, Microsoft General Counsel, Mar 24, 2004 (the code-removal remedy [sought by the European Comm ission under EU comp etition law] amounts to a compulsory l i c e n s e o f t he W i n d o w s t r ad e m a r k i n vi o la t io n o f T R I P S ), a v a il a b l e at http://www.microsoft.com/presspass/legal/european/03-24steveballmer-us.asp. For example, trademark litigation comprised a substantial proportion of early cases involving internet-based activity. See Torsten Bettinger and D orothee T hum, Territorial Trad ema rk Rights in the Global Village International Jurisdiction, Choice of Law and Substantive Law for Trade mark Disputes on the Internet (Part One), 31 I.I.C. 162, 163 (2000 ) (Hitherto, the most frequent cause of legal disputes on the internet has been the infringement of trademark rights). The valuatio n of M icroso ft is no do ubt in part dependent upon its copyright in the Windows operating software, but is also heavily dependent upon the W IND OW S mark, as was evident in the recent world wide battle to have that mark dec lared generic so as to facilitate use by a rival of the mark LIN DO W S. See Microsoft-Lindows Battle Expands in Europe, CN et Ne ws.com, Dec. 8, 2 003 ; see also Microsoft Corp. v. Lindows.com, Inc., 319 F. Supp. 2d 1219 (W .D. W ash. 200 4); Saul Hansell, Advertisers Follow the Traces Left Behind by Internet U sers , N.Y. T IMES , Aug. 15, 2006 at A1, C10 (noting that advertising on search engines, helpfully tied to the interests of users in part by use of indexed marks, is already a $14 billion-a-year business). There are exceptions, of course . See, e.g., W illiam M. Landes & Richard A. Po sner, Trademark Law: An Econom ic Perspective, 30 J.L. & E C O N . 265 (1987); W ILLIAM L A N D E S A N D R ICHARD P OSNER , T H E LA W A N D E CON OM ICS OF I N T EL LE C TU AL P R O P E RT Y L A W (2003); Frank Schechter, The Rational Basis of Trademark Protection , 40 H ARV . L. R EV . 813 (1927); F R A N K S CHECHTER , T HE H ISTOR ICAL F OUND ATIONS OF THE L A W R ELATING TO T RADE-M ARKS (1925); Daniel M. McClure, Trademarks and Unfair Competition: A Critical History o f Legal Th oug ht, 69 T RADEMARK R EP . 305 (1979); Daniel M . McClure, Tradem arks And Competition: The Recent History , 59 L A W & C O N TE M P. P R O B . 13 (1996). And in the last few years, a greater number of intellectual property scholars have begun the process of providing a richer theoretical grounding.
18 17 16
trademarks have evolved substantially from their historical roots. Conventional trademark theory, dating in the United States from the Lanham Act of 1946, and judicial and legislative expansions in 1962 and thereafter, rests protection on two purportedly simple and complementary objectives succinctly identified in the Senate Report accompanying the Lanham Act: to protect the public so that it may be confident that, in purchasing a product bearing a particular trademark which it favorably knows, it will get the product which it asks for and which it wants to get; and to ensure that where the owner of a trademark has spent energy, time and money in presenting to the public the product, he is protected in his investment from its appropriation by pirates and cheats.19 This is a very general statement of the purposes of trademark law, and perhaps because of that is taken as an unquestioned (and almost untouchable) truth. In recent years, the dual purposes of protecting consumers expectations and producers goodwill have been reformulated in economic terms by Chicago school theorists, who have explicitly grounded trademark protection in economic efficiency.20 As the United States Supreme Court explained in Qualitex Co. v. Jacobsen Prods., Trademark law, by preventing others from copying a source-identifying mark, reduce[s] the customer's costs of shopping and making purchasing decisions, for it quickly and easily assures a potential customer that this itemthe item with this markis made by the same producer as other similarly marked items that he or she liked (or disliked) in the past.21 This reformulation does not, however, challenge the general statement of the Senate Report. It simply recasts those purposes in the language of law and economics. In particular, it does not alter an important aspect of the conventional justification: producer and consumer interests each supported the grant and vindication of trademark rights.
Comm entary outside the legal field has always been more voluminous, and that body of work has become increasingly critical of the strength of trad emarks. See, e.g., N A O M I K LE IN , N O L OGO (2002); D A V ID B OLLIER , B R A N D N AME B ULLIES : T HE Q U E S T T O O W N A N D C ON TRO L C ULTURE (2004).
19
S. Rep. No. 13 33, 79th Cong., 2d Sess. 3 (1946 ).
See, e.g., L ANDES & P OSNER , supra note __, at 168 ("T he value of a trademark to the firm that uses it to designate its brand is the saving in consumers search costs made possible by the information that the trademark conveys or embodies about the quality of the firms brand."); see also W illiam A. Landes & Richard Posner, Tradem ark Law: An Econo mic Perspective, 30 J.Law & Eco n. 265, 290 (1987).
21
20
See Qualitex Co. v. Jacobsen Prods., 514 U .S. 159, 163-164 (1 995) (citations omitted).
Although the basic theoretical justification for trademark law has remained constant in the sixty years since the Senate Report and the Lanham Act,22 trademark23 protection has expanded substantially. 24 Trademark subject-matter has become almost limitless.25 Applications for trademark registrations can be filed and priority dates obtained prior to the first use of the mark in commerce,26 and the underlying common law prerequisite that trademark rights accrue only upon use of the mark has been liberalized.27 Rights can be acquired on an international basis with far greater ease, involving a single application to the United States Patent and Trademark
22
[insert cites to recent SCOT US op inions citing S. Rep].
A somewhat different paradox appears in copyright law. Although legal norms are seen as having shifted toward s right holders o ver the past thirty yea rs, in practice the public has access to a far greater range of works, and is effectively able to do much more w ith those works, than was the case when copyright law was less expansive. This public domain paradox merely highlights that social freedoms are a p roduct of m uch m ore tha n legal rights but instead are also a function of techn ology, voluntary compliance, an d enfo rcem ent. To be sure, there have b een d evelo pme nts both in Congress and in the courts (but mo re so in the latter) that run counter to this trend. See, e.g., W al-Mart Sto res, Inc. v. Samara Bros., 529 U.S. 205 (2000); TrafFix Devices, Inc. v. Marketing Displays, Inc., 532 U .S. 23 (2001); Dastar Corp. v. Tw entieth Century Fox Film Corp., 539 U.S. 23 (2003). Some of the reforms have been legislative. In 1998, Co ngress amended the Lanham Act to clarify that functionality could be asserted as a defense even in an action for infringement of a mark covered by an incontestable registration, and could be a ground for cancellation of a registration even after the passage of more than five years. See Tradem ark Law Tre aty Implementation Act, Pub. L. No. 105-330, 20 1 (1998 ); see also 15 U.S.C. 1052(e)(5) (2000) (functionality explicitly a ground for ex parte denial); see 15 U.S.C. 1125(a)(3) (burden of proving nonfunctionality on plaintiff when mark wa s unregistered). International obligations also forced the amendment of the principal registration provision to deny registration for marks that potentially infringed on geographic indicatio ns in wines and spirits. See 15 U.S.C. 10 52(a). See Qualitex Co. v. Jacobson Prods., 514 U.S. 159 (1995); Graeme B. Dinwoodie, The Rational Limits of Trad emark L aw (200 0) (plus 200 5 Postscrip t), in U.S I NTELLECTUAL P ROPERTY : L A W A N D P OLICY 59, at 59 (Hansen ed. 200 6). See 15 U.S.C. 1051(b) (providing an alternative basis for registration based upon a bona fide intention to use a trademark in commerce); 105(c). The Trademark Law Revision Act of 1988 liberalized registration options by permitting intent-to-use applications. See Trademark Law Revision Act of 1988, Pub. L. No . 100-667 , 102 Stat. 39 35 (198 8). H owever, in order to obtain a registration, an intent-to-use applicant must file a statement verifying that the mark has b een put into use in commerce, within a prescribed time. See 15 U .S.C. 105 1(d). The princ ipal exceptions largely involve the registration of foreign marks. See 15 U.S.C. 1 126(e), 1141 (f)(2004). In 1988, when Congress introduced the possibility of filing trademark applications based upon an intent to use, the standa rd for use was nom inally tighten to preclude the possibility of rights being acquired based upon token use. But courts have found the statutory definition of use a very weak barrier to finding use where they see the consumer protection purposes of U.S. law implicated. See International B ancorp, LL C v. Socit des Bains de Mer et du Cercle des trangers Monaco, 329 F.3d 359 (4 th Cir. 2003), cert. denied , 124 S. Ct. 1052 (2004); see also Grupo G igante v. Dallo & Co ., Inc., 391 F.3d 10 88, 1093 (9th Cir. 2004).
27 26 25 24
23
Office.28 The period of non-use prior to a presumption of abandonment of a mark has been lengthened.29 The control requirement necessary to validate trademark licensing has been applied with little rigor.30 The scope of rights obtained by a trademark owner has expanded, both in terms of the geographic reach of rights31 and the type of uses against which relief can be secured; actionable confusion has been expanded to encompass confusion as to matters other than source of goods,32 to consumers other than purchasers,33 at times other than at point of sale,34 and new causes of action have been created that provide relief without confusion.35 Enforcement powers have been augmented; plaintiffs can now bring infringement actions based upon in rem jurisdiction over a domain name,36 and remedies for a successful plaintiff have been enhanced, especially in the areas of counterfeiting and cybersquatting.37 Many of these developments can, as discrete reforms, be supported. But the collective enhancement of rights has begun to attract criticism from scholars and, to
28
See Madrid Protocol Implementation Act of 2002, Pub. L. 107-273, 116 Stat. 1758. See 15 U.S.C. 11 27 (definition of abandoned).
29
See University Bookstore v. University of Wisconsin Board of Regents, 33 U.S.P.Q.2d (BN A) 1385 (TT AB 199 4). See Gra eme B. D inwoo die, Developing a Private International Intellectual Property Law: Transnational Dialogue as a Lawmaking Institution (Dra ft of M arch 2 2, 20 06) (cop y on file with author) (discussing extra territorial application of the Lanham Act). See Pub. L. No. 87-7 72 (196 2) (deleting references to origin and purchasers); see also 15 U.S.C. 1125(a) (rendering actionable confusion as to affiliation, endorsement, sponsorship or connection); A&H Sportswear, Inc. v. Victorias Secret Stores, Inc., 237 F.3d 198 (3d Cir. 2000) (reverse confusion).
33 32 31
30
See Pub. L. No. 87-77 2 (1962 ).
See Ferrari S.P.A. Esercizio v. Roberts, 944 F.2d 1235 ( 6th C ir. 199 1) (post-sale confusion); Brookfield Co mms., Inc. v. W est Coast Ent. Corp., 174 F.3d 10 36 (9th Cir. 1999) (initial interest confusion); Playboy Enters., Inc. v. Netscape C omm s. Corp., 354 F.3d 1020 (9th Cir. 2004) (same). See Federal Tradem ark Dilution Act, Pub. L. No. 104-98, 109 Stat. 985 (1996); 15 U.S.C. 1125(c); Anti-Cybersquatting Consumer Protection Act of 1999, Pub. L. No. 106-113, 30013010, 11 3 Stat. 1536, 1501(A )-545; 15 U.S.C. 11 25(d); See Harrods Ltd. v. Sixty Internet Domain Names, 302 F.3d 214 (4th Cir. 2002); 15 U.S.C. 1125 (d)(2).
37 36 35
34
See 15 U.S.C. 1117(b); 15 U.S.C. 1117(c); 15 U.S.C. 1129.
10
a lesser extent, from courts.38 One of the complaints leveled at these developments is that they have caused a divergence of producer and consumer interests, serving only the former.39 But the easiest targets for this criticism have proven to be those developments that appear to confer close to property-like rights on producers. For example, both dilution protection (introduced at the federal level in 1995) and protection against cybersquatting (introduced in 1999) have been seen as devices simply to reflect producer interests, and have as a result suffered steady scholarly criticism and have met (at least in the case of dilution) some judicial resistance as a result.40 Likewise, early efforts to use trademark law to control the market for merchandizing or promotional products, or to protect distinctive product designs against post-sale confusion, were attacked as offering property-like rights without regard for consumer protection.41 In contrast, less sustained criticism is directed at expansions in protection grounded (often genuinely) in the consumer protection rationale.42 As noted above, framing protection as necessary in order to avoid consumer confusion appears to make the protection of producer value an incidental benefit, causing a happy convergence of public and private interest.43 Yet, these confusion-based developments may achieve
For judicial disap proval, see, e.g., Moseley v. V Secret Catalogue, Inc., 537 U .S. 418 (2003); W al-M art Stores, Inc. v. Sam ara B ros., 52 9 U .S. 20 5 (2000 ); [Lund v.Ko hler]. See, e.g., Mark A. Lemley, The Modern Lanham Act an d the D eath of C ommon Sen se , 108 Y ALE L. J. 1687 (199 9); [Lunney, Port, Naresh, Long].
39 38
[judicial critiques of dilution].
See Moseley v. V S ecret C atalogue, Inc., 537 U.S. 418 (2003); [state cases in Illinois]; see also Clarisa Long, Dilution, __ CO LU M . L. R EV . ___ (2006). The cybersquatting cause of action has proven somewhat more immune to attack. See Bosley Me dical Institute v. Kremer, 403 F.3d 672 (9 th Cir. 2005) (dismissing infringement and dilution action, but not cybersquatting action, because of lack of commercial use); see also Lamparello v. Falwell,420 F.3d 309 (4th Cir. 2005). Courts offering that protection nominally dressed their decisions in the language of consumer confusion. But the suspicion that that was a fabrication and a cover for nothing more than producer rent-seeking perm eates those judicial opinions that seek to curtail protection of trademark owners against post-sale confusion, unauthorized merchandizing, or product design simulation. Indeed, efforts to rehabilitate doctrines such as dilution may seek to discover consumer protection purp oses to legitimate the form of pro tection. See Ty, Inc. v. Perryman, 306 F.3d 509 (7th Cir. 200 2); see also Graeme W . Austin, Trademarks and the Burdened Imagination, 69 B R O O K LY N L. R EV . 827, 891 n.276 (2004) (Certainly, dilution doctrine seems more palatable from a policy perspective if it does something positive for consumers rather than just protecting the property interests of proprietors of famous trademarks.). This is a rhetorical de vice no t unkno wn in other areas of intellectual prop erty law. See T H E F EDERALIST N O . 43 (James M adison) (The utility of this power will scarcely be questioned. The copyright of authors has been solemnly adjudged, in Great Britain, to be a right of common law. The right to useful inventions seem s with equal reason to belong to the inventors. T he public go od fully
43 42 41
40
11
as much, if not more, expanded protection without the same barrage of scholarly and judicial concern.44 Proceeding under the convenient cover of consumer protection often seems to provide an intellectual immunity to these developments.45 When these developments have taken the form of legislative expansions of rights, which has been rare, there has been a relatively vibrant public debate about the wisdom of the change. Thus, for example, the federal dilution statute was help up for almost a decade while opponents secured exceptions designed to protect free speech values.46 Intent to use applications, which facilitate the acquisition of rights and to level the playing field for U.S. producers seeking rights on an international basis, were introduced decades after other common law countries made the same change and after a detailed legislative study. 47 Setting aside whether the outcome of these legislative battles matched the balance seen in the antecedent debate and the evidence is mixed in the case of trademark law it is clear that some of the expansions in protection are due to politically-well-aired changes in applicable legal norms. But many other expansions in trademark protection are due to the purportedly constant application by courts of existing legal norms to changing social and economic facts.48 Thus, for example, protection of visual symbols can be justified
coincides in both cases with the claims of individuals). But it has particular appeal in trademark law where consumer protection has classically been placed front and center. For examp le, expanded con fusion-based causes of action p rovide p rotection to all marks, whereas dilution protection applies only to a subset of marks (i.e., famous marks). See 15 U .S.C. 112 5(c). Although not entirely in recent scholarship. The initial interest confusion doctrine has been the subject of the m ost concentrated criticism. See, e.g., Jennifer Rothman, Initial Interest Confusion: Standing at the Crossroads of Trademark Law , 27 CARD . L. R EV . 105, 113 (2005); Stacey L. Dogan & M ark A. Lemley, Trademark and Consum er Search Costs on the Internet , 41 H O U S . L. R EV . 777 (2004).
46 45 44
See Denicola, supra note __, at __.
The norm of being permitted to file an application without prior use has since been elevated to a mandatory internation al standard. See TRIP S Agreement, art. 15(3). To be sure, expansion of the related goods on which use of a mark could be enjoined (to include confusion as to affiliation o r endorsem ent, and to encompass post-sale confusion) can be traced to a small alteration of the statutory infringement standard that broadened the types of confusion that would be regarded as actionable. See Syntex Labs. v. Norwich Pharmacal. Co., 437 F.2d 566, 568 (2d Cir. 1971). But some scholars have questioned whether the legislative amendment was intended to achieve the reform that courts implemented. See Sara Stadler, The Wages o f Ubiquity in Trade mark Law , 88 IO W A . L. R EV . 731, 800-01 (2003). And one has to be careful about drawing these lines too firmly. These developments might to some extent be connected to parallel social
48
47
12
by the same purposes as applied to textual or verbal symbols, when one operates in a global and contemporary social environment where visual symbols assume much greater significance to consumers.49 Expansions in the scope of rights to accord producers control over merchandizing of their marks is often rationalized as protecting consumers against confusion as to affiliation or endorsement; that conclusion acts on a premise about changing consumer understandings about the use of marks to express affiliation, or (perhaps relatedly) on evolving forms of economic organization and commercial activity.50 Similarly, holding online intermediaries liable for uses of marks in particular contexts (e.g., registration of a domain name, or the sale of keywords or pop-up ads linked to marks) depends heavily upon often untested assumptions about consumer behavior. In all these contexts, courts purport only to be applying a long-standing legal norm to a new set of social facts or assumptions. II. REACTIVE TRADEMARK LAWMAKING The form of trademark lawmaking that claims simply to be applying existing legal norms to new empirical social realities is what I have referred to as reactive lawmaking. 51 Numerous judicial expansions of trademark law have been effected by generalized reference to the need to protect consumer association notwithstanding that traditional rules of trademark law had not previously offered relief in the factual circumstances in question. These developments can be seen most notably in evolutions in rules regarding how consumer association can be established, which
develop ments, in that changes in the legal norms might have b een p rompted by changes in economic structure, producer behavior, or the nature of consumer shopping. Mo reover, even if the legal norm had not changed, a similar result might have been achieved over time by an evolution in social norms. For example, consolidation of business in the second half of the twentieth century may have prompted consumers to view the question of source more broadly, and if courts acted on that, they may have implemented the same expansion of trademark rights that Congress effected by amendments to Section 32 in 1962. But these changes were both expedited and embedded by changes in the legal standards. See Dinw ood ie, supra note 5 , at __; D inwoo die, Rec onc eptualizing the Inherent Distinctiveness of Prod uct De sign Trade D ress , supra note 1, at __.
50 The notion that confusion might expand beyond confusion as to source can be traced initially to silence in the statute (after the deletion of narrowing language in 1962), which courts promptly filled with content drawn from social and commercial norms. Once this expanded notion of confusion was embedded in judicial development of trademark infringement, the 1988 reforms made confusion as to association an explicit statutory cause of action, although even now that term is infused with meaning by social and commercial behavior. Of course, these social and commercial understandings and behavior are p artially products of the legal climate that has developed. The relationship is dynamic. 51 49
[An alternative terminology might distinguish between (1) norm-reflecting rules, a category that corresponds roughly to what I described above as reactive lawmaking, and (2) norm-creating rules, which corresponds roughly to wha t I described above as p roactive lawmaking. ]
13
consumer associations warrant the protection of trademark law, and the types of confusion against which such protection is offered. At common law, a producer could only acquire rights in a mark by using the mark. Rights were established by use, not by conception or creation.52 In several cases in the early twentieth century, however, courts expanded the notion of use necessary by a trademark owner to acquire rights to encompass what Mark Janis and I have called surrogate use.53 For example, in Coca-Cola v. Busch, a district court recognized that the Coca-Cola Company could obtain protection for the word COKE for soft drinks even though it had never used that word to identify its product by sale, advertisement or otherwise.54 Despite the strict approach to trademark rights then prevailing, in the years before the Lanham Act, the court held that the abbreviation of the trademark which the public has used and adopted as designating the product. . . is equally to be protected as the trademark itself.55 The court explained that it reached its decision because by 1942, the emphasis in trademark cases was on the injury suffered by the public from confusion.56 Confusion would ensue from the defendants use of a similar term because there was consumer association of the term COKE with the producer despite the lack of use of the term by the producer.57 The court deduced the likelihood that consumers would make such an association from observing the habits of American youth in the 1940s, noting the marked tendency of American youths to shorten and abbreviate anything that is capable of being shortened. Indeed, the court had factual support: testimony
See Columbia Mill v. Acorn, 150 U.S. 460, 463-64 (1893) ([T]he exclusive right to the use of the mark or device claimed as a trade-mark is founded on priority of appropriation; that is to say, the claimant of the trade-mark must have been the first to use or employ the same on like articles of production.) (distilling this principle from prior Supreme Court cases); Trade Mark Cases, 100 U.S. 82, 94 (1879) (The right to a particular mark grows out of its use and not its mere adoption.). See G RAEME B. D IN W O O D IE & M ARK D. J AN IS , T R A D EM A R K S A N D U NFAIR C O M P E TIT IO N : L AW A N D P OLICY ch. 4 (2 004 ); see also Graeme B . Dinwoodie and Mark D . Janis, Use, Intent to Use, and Registration in the United States, in T RADEMARK U SE 313, 315 (Philips and Simon eds., 2005).
54 53 52
See Coca-Cola Co . v. Busch, 44 F. Supp. 405, ___ (E.D. Pa. 1942 ). Id. at ___.
55
See id. The normative foundations of earlier trademark law are more com plex. See Mark P. M cKenna, The Normative Foundations of Trademark Law , at www.ssrn.com. The surrogate use by the public enured to the benefit of the producer because such abbreviated use was read ily understood as identifying the producer of COCA-COLA. M ost such surrogate uses occur with some involvement by the trademark owner, for example, as licensor of the mark. See 15 U .S.C. 1055. And conceiving of trademarks in property terms does appear to require an allocation of ownership, a fact exacerbated b y standing rules that give rival traders, but not consumers, standing to vindicate concern about consumer confusion.
57
56
14
showed that when COCA-COLA soft drinks were purchased, they were often referred to by the abbreviation COKE.58 Similar awareness of changing social conditions has informed the recent development of another use-based doctrine. Where U.S. trademark rights cannot be established based upon a producer using a mark in commerce, the so-called famous marks or well-known marks doctrine may permit a producer using the mark abroad to obtain relief in the United States if the mark is well-known here.59 Although protection for well-known marks has been mandated in some form by Article 6bis of the Paris Convention for decades, until recently, the U.S. courts had only rarely found for a foreign producer on the basis of this doctrine.60 In the last three years, however, there has been a spate of litigation involving the assertion of rights based upon this doctrine.61 The lower courts have not yet developed a coherent understanding of the doctrine. Some have denied its existence in federal law,62 while others found rights for the foreign producer according to the most liberal conceivable standard (i.e., the existence of secondary meaning among U.S. consumers).63 Although the appellate courts have declined to adopt the most liberal interpretation of a well-known mark, the compromise standard they have adopted remains generous and will likely permit a far greater range of foreign producers to claim rights in the United States without using the mark here. One could conceptualize the development of easier protection for such well-known marks as the plaintiff being permitted to substitute a substantial degree of consumer
58
This strategy d oes not always work. See, e.g., [Harley Hogs].
See generally Graeme B. D inwoo die, Trademarks and Territory: Detaching Trademark Law From the Na tion S tate ,41 H O U S TO N L A W R E VIE W 885 (20 04). See Paris Convention for the Protection of Industrial Property, July 14, 1967, 21 U.S.T. 158 3, 82 8 U .N.T .S. 30 5, art. 6 bis . See, e.g., Empresa C ubana del Tab aco v. Culboro Co rp., 70 U.S.P.Q.2d (B NA) 1650 (S.D.N.Y. 200 4), revd on other gro unds, 399 F.3d 4 62 (2d C ir. 200 5); G rupo Gigante v. Dallo & Co., Inc., 391 F.3d 1088, 1093 (9th Cir. 2004 ) (noting liberal district court decision). De Beers LV Tradem ark Ltd. v. DeBeers Diamond Syndicate Inc., 2005 W L 1164 073 (S.D .N.Y. M ay 18, 2005). See Almacenes Exito S.A. v. El Gallo Meat Mkt, Inc., 381 F. Supp. 2d 324 (S.D.N.Y. 2005) (finding no such doctrine in fed eral law but rec ognizing it as part of New Y ork state law); see also Graeme W . Austin, The Territoriality of United States Trademark Law in I NT ELLEC TU AL P ROPERTY A N D I N F O RM A T IO N W E A LT H (Peter Yu ed. 200 7) (forthcoming). See Empresa Cubana del Tabaco v. Culboro Corp., 70 U.S.P.Q.2d (BNA) 1650 (S.D.N.Y. 2004) finding that a mark is well-known for purposes of the well known mark exception when it has acquired secondary meaning), revd on other gro unds, 399 F.3d 462 (2d Cir. 20 05); see also Grupo Giga nte v. Dallo & Co., Inc., 391 F.3d 1088, 1093 (9th Cir. 2004) (noting liberal district court decision).
63 62 61 60
59
15
association in the United States for actual use in the United States.64 Indeed, along with case law that endorses notions of surrogate use, this jurisprudence might simply prove that the concept of use in U.S. law is in fact merely a vehicle or proxy for other concerns such as distinctiveness that go directly to the root of trademark policy.65 But the important point is that use is a vehicle for consumer association, the development of which is inherently dynamic and reflective of changing social conditions. The Ninth Circuit in one such case, Grupo Gigante, relied on more rapid immigration patterns to support its willingness to protect the foreign mark owner absent use in the United States, noting that an absolute territoriality rule without a famous-mark exception would promote consumer confusion and fraud. Commerce crosses borders. In this nation of immigrants, so do people. . . . .There can be no justification for using trademark law to fool immigrants into thinking that they are buying from the store they liked back home.66 The greater availability of the well known mark doctrine may appropriately reflect courts protecting consumer association in an era when reputation crosses borders well ahead of the producers products or services. Consumer association is now created by satellite television, internet traffic, and increased patterns of global travel and immigration. Selling products under a mark and advertising in local newspapers is not required to develop consumer association, and thus, the argument goes, it should not be required to establish trademark rights. The same judicial impulses to reform trademark rules in order to ensure that consumer association is protected, where that association might have developed as a result of changed social practices, can be seen in the effective elimination of limits on trademark subject matter. Again, courts formally did not alter any basic legal norms: to be protected, marks had to be distinctive. Thus, when courts expanded the subject matter of trademark to include product designs, sounds and smells, it was nominally because of the ability of that subject matter to act as source-identifiers.67 Consumers had in fact come to associate particular products by their shape, or by smell, or by sound. Thus, that association ought to be protected. The descriptive
See Dinw ood ie, supra note __, at __.; cf. Lionel Ben tly, From Communications to Things (on effect of switch to property rhetoric on willingness to protect marks used primarily abroad). See Graeme B . Dinwoodie and M ark D. Ja nis, Confusio n O ver U se: Contextualism in Trademark Law , supra note __.
66 65 64
See Grupo G igante v. Dallo & Co ., Inc., 391 F.3d 10 88, 1093 (9th Cir. 2004).
See Dinwoodie, supra note __, at ___. Critics saw this as merely a post-hoc rationalization of a judicial impulse to re strain free-riding. See [critics]. Of course, given the power of the consumer protection rhetoric, it is a persuasive rationalization.
67
16
assessment thus generated a prescriptive policy position, the only explicit reference to normative goals being the commitment to the general protection of consumer understanding (without recognizing that not all consumer understanding is protected by trademark law). Numerous expansions of trademark rights have been justified by reference not only to new forms of consumer association spawned by modern commerce and communications, but also by painting new scenarios of confusion that can be traced to the same sources of social change. For example, in 2000, in GoTo.com v. Walt Disney, the Court of Appeals for the Ninth Circuit offered very broad protection to trademark owners against confusion in the internet environment.68 The plaintiff was a search engine that complained that the entertainment giant Disney was using a logo to advertise a new Disney web portal that was almost identical to the search engines logo (the words GOTO in a green circle). The Ninth Circuit had three years earlier, in one if its first online trademark cases, decided to adapt its usual eight-factor test for likelihood of confusion to reflect the online character of the dispute with which it was faced.69 The court had in that early case stressed that a trinity of the usual factors were particularly important in internet cases, and the GoTo court three years later sustained a finding of likely confusion largely upon analysis those same three factors: similarity of the respective marks, similarity of the parties goods, and the common marketing of the parties goods and services on the web. The first two factors seem unsurprising, but giving substantial weight to the fact that both parties marketed goods on the web now seems ludicrous. The courts willingness to find confusion based on these three factors alone would appear to reflect an enhanced concern that consumer confusion might easily result online given the popularization of the use of the internet without concomitant public understanding of the medium. Thus, in reaching its decision, the GoTo court took note of the fact that although computers may once have been the domain of an elite intelligentsia, even modern day-luddites are now capable of navigating cyberspace.70 As a result, and acting to reflect the care of the least sophisticated consumer, the court declined to weigh the sophistication of users in favor of the defendant, commenting that our ever-growing dependence on the web may force us eventually to evolve into increasingly sophisticated users of the medium, but for now we can safely assume that the use of remarkably similar trademarks on different web sites
68
Goto.com, Inc.v. W alt Disney Company, 202 F.3d 11 99 (9th Cir. 2000). See Brookfield Com m., Inc. v. W est Coast Ent. Corp., 174 F.3d 103 6 (9th Cir. 1999). See GoTo , ___ F.3d at ___.
69
70
17
creates a likelihood of confusion among consumers.71 The court also noted the effect of changes in economic organization, recognizing that the ever-growing number of tentacled conglomerates may force us to conclude that even one hundred and one products could all be sponsored by a single consortium.72 Nominally, the court was applying the same legal norm preventing third party uses that created a likelihood of confusion but allowed changes in social practices to alter the application of that norm in important ways. Although the Ninth Circuit has in later cases modified the analysis of the third factor,73 the decision did embed in Ninth Circuit case law a remarkably paternalistic view of trademark law. The flawed factual premise became ossified in trademark doctrine through the generative capacity of the common laws inductive method,74 as later courts in the Ninth Circuit assessed confusion in online contexts through the courtss curtailed trinity of internet factors.75
In an irony apparently lost on the Ninth Circuit, that very sophistication is probably delayed by the paternalism that the court showed: the same minimal cost involved in clicking erroneously on one site, which the court used to support likely confusion, might have been used to show that the minimal cost of clicking back limited any likely harm.
72
71
See id. at ___.
See Entrepreneur Med ia Inc. v. Smith, 279 F.3d 113 5 (9 th Cir. 2002) (analyzing the marketing channels factor by asking (1) whether both parties use the Web as a substantial marketing and advertising cha nnel; (2) whether the p arties' marks are utilized in conjunction with W eb-based products; and (3) whether the parties' marketing channels overlap in any other way.); see also Therma-Scan Inc. v. Thermo scan Inc., 295 F.3d 623 (6th Cir. 2002 ). See Thomas Mackay Cooper, The Comm on Law and Th e Civil LawA Scots View , 63 H ARV . L. R EV . 468, 470-71 (19 50) (The civilian p uts faith in syllogism s, the common lawyer in preced ents; the first silently asking himself as eac h new problem arises, W hat should we do this time and the second asking aloud in the same situation, What did we d o last time?). The most substantial efforts within the Ninth Circuit to restrict the scope of protection online in the wake of these cases has nominally come not through a challenge to the assessment of confusion, but through tortured statutory interpretations that have transplanted the co mmerc ial use requirement from the context of dilution law to all infringement actions. Thus in B osle y M edical Institute v. Kremer, 403 F.3d 6 72 (9 th Cir. 2005), Defendant Kremer operated a web site critical of plaintiff Bosleys services at the domain www.BosleyMedical.com, and Bosley alleged infringement (among other claims) of his BOSLE Y M EDIC AL mark. The N inth Circuit affirmed summary judgment against B osley on the infringement claim. The court read the Lanham Act infringement provision as requiring that the trademark owner show that the defendants use was a commercial use, which provided the doctrina l basis for the courts holding. Ho wever, the courts analysis of this requirement was primarily a proxy for conclusions regarding confusion, with the court asserting that no custom er will mistakenly purchase a hair replacement service from K remer under the belief that the service is being offered by Bo sley and that Kremer was not ca pitalizing on [Bosleys] good will. The Bosley decisio n can b e criticized on severa l grounds. See Dinwo odie and Janis, supra note __, at __. But even the court in Bosley, which was nominally willing to find a defendants use
75 74
73
18
Finally, in another example of new confusion scenarios being constructed with the fabric of modern life, in International Bancorp v. Societe de Bains du Mer, the Fourth Circuit recently held that the use in commerce prerequisite for establishing rights could be satisfied where the trademark claimant used the term in advertising in the United States and offered the advertised services to Americans, even where those services were offered abroad.76 This approach to use in commerce thus conferred U.S. rights on a Monte Carlo casino that offered services to American tourists in Monte Carlo. The court relied on a textual interpretation of the statutory definition of use in commerce to support its expansive approach to establishing rights. But case law had consistently established that use of a foreign trademark in connection with goods and services sold only in a foreign country by a foreign entity did not constitute use of the mark in United States commerce sufficient to merit protection under the Lanham Act. The merits of the Fourth Circuits approach to what constitutes use can be debated at length.77 For present purposes, it is simply worth noting that the court justified its novel interpretation of the U.S. statute by conjuring up the image of American tourists who, having been to Monte Carlo to play in the casinos, returned home to the United States only to be confused when presented with an online gambling site that included the name MONTE CARLO. There may in fact be some possibility that that would occur. But, again, support for a development of trademark law is grounded in the need to react to yet another empirical feature of modern society, namely increased international travel.78 III. DO TRADEMARK COURTS CURRENTLY ADOPT A PURELY REACTIVE POSTURE? The type of trademark lawmaking (or trademark argumentation) exhibited by the
perm issible based upon the ch aracter of its use without regard to confusion, felt co mpe lled to wrap its conclusion up in the language of confusion. International Bancorp, LL C v. Socit des B ains de Mer et du Cerc le des trangers Monaco, 329 F .3d 3 59 (4th Cir. 200 3), cert. denied , 124 S. Ct. 1052 (20 04). See Dinw ood ie, supra note __, at __. The Trademark Trial App eal B oard has effectively declined to follow International Ba ncorp . See First Niagara Ins. Brokers Inc. v. First Niagara Financial Group, Inc., 77 U.S.P.Q.2d (B NA) 13 34 (TT AB 2 005) (reaffirming that advertising and promotion of a mark in connection with good and services marketed in a foreign country (whether the advertising occurs inside or outside the United States) creates no priority rights in said mark in the United States unless the mark is famous or the domestic applicant acted in bad faith). Formally, the Board distinguished International Ba ncorp , noting that in the case before it, the foreign (Canadian) partys activities in the United States were minimal and incidental and its advertising was directed to Canadian purchasers.
78 77 76
[also S terling D rug: mu ltinationals; satellite.]
19
courts in the cases described in Part II has the appearance of being purely reactive. Trademark law takes the market and consumers as it finds them. This is, at least formally, a static inquiry that fails to recognize the inherently dynamic nature of trademark law and consumer behavior. But, of course, that is precisely what make it valuable as a tool of judicial decision-making; it offers the pretense of objectivity and judicial modesty. Reactive argumentation is not entirely inappropriate. The two inquiries discussed in Part II whether there is consumer association and whether there is likely confusion do help to determine whether there are any affirmative reasons to trigger trademark law. The failure to implicate those purposes should result in the denial of relief under trademark law; the triggering of those concerns warrants our contemplating protection. It is on these objectives that any trademark dilemma pivots and thus they are appropriately at the heart of trademark policy.79 And context surely is important too. One of the advantages of flexible trademark standards is that they can give effect to core trademark values in a number of contemporary settings without the need for legislative intervention. Thus, I am not disavowing the consumer protection rationale, or questioning the centrality of consumer association or likelihood of confusion to trademark law. But these concepts are only starting points for judicial analysis. Reactive argumentation is incomplete as an exhaustive account of trademark law, both descriptively and prescriptively. The traditional analytical framework of trademark law fails adequately to describe what underlies the law, or to provide sufficiently complete perspectives on the most difficult and important issues of trademark law today. In this Part of the Article, I show that trademark law already goes beyond reactive lawmaking in a number of ways. To be sure, courts in classical infringement cases tend to talk about rules as implementing the basic purposes of trademark law, namely, the avoidance of confusion through unauthorized use of symbols that acts as source-identifiers for consumers.80 But the fact that this rationale supports and
In some areas one finds greater reference to additional or subsidiary objectives. Reference to concerns about the effects on competition, for example, is prominent in drawing the line between descriptive and suggestive marks, and in articulating the reach of the functionality doctrine. But even in those circumstances, the competing policy concerns are often too quickly wrapped up in the language of consumer asso ciation or co nsumer confusion. See infra (discussing the incorporation of competition concerns into distinctiveness analysis). Courts have developed a large volume of subsidiary rules of trademark law that are designed simply to facilitate judicial analysis of different factual situations and, in each situation, effectuate these objectives. Thus, for example, substantial case law had developed on the various likelihood of confusion factors, considerations that (though articulated no w as rules of law) a re essentially efforts to a id courts in determining whether confusion is likely and thus whether the basic purposes of trademark law are implicated. (Yet some of those rules, such as the greater scope of protection for
80
79
20
explains the grant of protection where it is accorded, does not mean that as soon as consumer confusion regarding a symbol occurs, that protection should kick in. Consumer association and consumer confusion are necessary, but not sufficient, to sustain relief for a plaintiff.81 Thus, as a purely descriptive matter, in a variety of contexts, courts already effectively ignore the existence of consumer association or the possibility of consumer confusion in order to effectuate broader objectives of trademark and unfair competition law: For example, courts implicitly over-ride (some levels of) goodwill by confining liability under classic trademark infringement to uses that would confuse an appreciable number of ordinarily prudent purchasers.82 Likewise, under functionality doctrine, if a mark is functional it will be unprotected by trademark law notwithstanding that it might have meaning for some consumers as a sourceidentifier.83 This approach reaches its apotheosis in the context of a product shape covered by an expired patent, where consumers may well have developed sourceidentification because of patent-conferred exclusivity, but for competing policy
stronger marks, are clearly co unter-intuitive and thus are likely rooted in some value other than avoiding confusion). For an empirical analysis of the multi-factor test, see Barton Beebe, An Empirical Study o f the Mu ltifactor Tests for Trademark Infringement, 95 CAL. L. R EV . ___ (2006) (forthcoming). See Graeme W . Austin, Fair Use: Tolerating Confusion in Trademark Doctrine in T RADEMARK L A W A N D T HEORY : A H AND BOO K OF C O N T EM P O R A RY R E S EA R C H (Dinwoo die and Janis eds. 2007) (forthcoming).
82 81
See Thom pson M edical Co., Inc. v. Pfizer, Inc., 753 F.2d 20 8, 213 (2d C ir.1985).
As I discuss below, some courts have developed a do ctrine of de facto secondary meaning that offers limited protection to marks that, though treated as de iure generic, have some lesser level of actual significance to co nsumers. That do ctrine m ight usefully be extended to functional marks, as well as other types ofdual-use marks. (A few courts have done so. See, e .g ., American Greetings Corp. v. Dan Dee Imports, Inc., 807 F.2d 1136, 1141 & 114 5-1147 (3d Cir. 198); Fisher Stoves, Inc. v. All Nighter Stoves, Inc., 626 F.2d 193, 195 (1st Cir. 1980); Keene Corp. v. Paraflex Ind us., Inc., 653 F.2d 822 (3d Cir. 1981). The approach was much more common in older cases. See, e.g., Crescent Tool Co. v. Kilborn & Bishop Co., 247 Fed. 299, 301 (2d Cir. 1917) (L. Hand, J.) (noting that the court must require such changes in app earan ce as will effectively d istinguish the defendants wares with the least expense to him); see also Jessica Litman , Note, The Problem of Functional Features: Trade Dress Infringement Under Section 43(a) of the Lanham Act , 82 CO LU M . L. R EV . 77, 81 n.30 ([T]he co mmon law rule was that if a feature o f a product was functional, it could be freely imitated so long as the im itator too k such steps as were necessary or such steps as were reasonable to prevent the public from be ing misled.); R E S TA T EM E N T O F T ORTS 741 (1938). For this type of approach to be adopted more generally, however, trademark law would have to adopt a proactive posture, accept competitiveness and protection of goodwill as independent (and sometimes) competing policy objectives that courts might on occasion reconcile through balancing of interests and regulatory (as opp osed to prohibitory) relief. See infra Part __ (discussing dual-use markets, defined by delivery at retail or wholesale, or by geography).
83
TRADEMARK LAW AND SOCIAL NORMS reasons trademark law allows the shape to be copied.84
21
A recent decision of the United States Supreme Court makes this point more explicitly than usually seen in judicial opinions. In KP Permanent Makeup v. Lasting Impression I, Inc.,85 the Court resolved a circuit split regarding whether a defendant can make out a defense of fair use notwithstanding a likelihood of confusion. Section 33(b)(4) of the Lanham Act provides that it shall be a defense to an action for infringement of any mark That the use of the name, term, or device charged to be an infringement is a use, otherwise than as a mark, of the party's individual name in his own business, or of the individual name of anyone in privity with such party, or of a term or device which is descriptive of and used fairly and in good faith only to describe the goods or services of such party, or their geographic origin.86 In the Second Circuit, courts had held that the defense could succeed even where the plaintiff could show that there was a likelihood of confusion.87 This was supported by case law in several other circuits (including the Fourth and Fifth Circuits). In contrast, in the Ninth Circuit, likely confusion had defeated the defense, which made the entire analysis hostage to questions of likely confusion.88 A unanimous Court held that the fair use defense under section 33(b)(4) should be available even when there was some likely confusion. The Courts conclusion flowed from what it described as two textual fixed points, namely, (1) that, even when the plaintiffs registration has become incontestable, section 33(b) makes clear that the plaintiff retains the burden of proving likelihood of confusion, and (2) Congress said nothing about likelihood of confusion in setting out the elements of the fair use defense in section 33(b)(4).89
84 See Graeme B. D inwoo die, The Death of Ontology: A Teleological Approach to Tradem ark Law , 84 I OWA L. R EV . 611 (1999); TrafFix D evices, Inc. v. M arketing Disp lays, Inc., 532 U.S . 23 (2001). 85
125 S.Ct. 542 (2 004).
Although the defenses listed in section 33(b) are literally available in actions brought for infringement of registered marks that have become inconstestable, section 33(a) makes clear that they app ly in all cases of alleged. trademark infringement. See 15 U.S.C. 11 15(a).
87
86
See, e.g., Car-Freshner Corp. v. S.C. Johnson, 70 F.3d 267, 269 (2d Cir. 1995).
See, e.g., Cairns v. Franklin Mint Co., 292 F.3d 1139, 11 52 (9th Cir.200 2); see also PAC AAR Inc. v. Telescan Tech., LLC, 319 F.3d 2 43 (6 th Cir. 2003).
89
88
See KP Permanent, 125 S.Ct. at ___.
22
However, the Courts textual analysis was supported by policy considerations drawn from the common law defense, which tolerated some amount of confusion because competitors may need to use a descriptive term in order accurately to describe their good, and thus to compete. Trademarks must not confer monopolies on the use of such terms. Moreover, consistent with a theme that one can see in other recent trademark decisions from the Court, the Court signaled to producers that the risk of confusion is a price that they pay when they adopt marks that are close to the threshold of protectability. 90 Thus, the reach of the fair use defense should in the last account be determined by balancing the competing goals of protecting goodwill and enabling free competition where use of the trademarked term is necessary to effectuate competitiveness or communication values. The approach of the Court affirmatively seeks to promote the communicative and competitive policies behind the defense over what it regards as minimal erosion of goodwill. [There are also a series of contexts91 where trademark law affords rights to the trademark owner that appear unnecessary to effectuate the classic purposes of trademark law but which are pursued in order to vindicate other objectives (such as commercial certainty).92 These would include, for example, the doctrine of incontestability. 93 Identification and analysis of these areas of law might also be
90
See KP Perm ane nt, 543 U.S. at 122; see also Dinw ood ie, Rehnquist, supra note __, at 209.
W hile most of these examples emanate from the legislature, the courts have on occasion been sympathetic to trademark owne rs claims in order to satisfy other objectives. For example, the doctrine of secondary meaning in the making, eventually rejected by the United States Supreme Co urt in Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 775 (1992), was a doctrine that was not subservient to the empirical realities of consumer association but instead developed a rule of law in recognition of competing realities (namely, the difficulties that arduous thresholds for trademark protection might present for small businesses). Likewise, the doctrine of token use developed by the courts prior to the ad vent of intent-to-use applications in 198 8 protected producer interests independently of consumer association. In most cases where these other objectives are pursued, the central consumer-con fusionavoidance goals of trademark law can intrude to limit relief. For exam ple, even the ho lders of nationwide priority (by virtue of federal registration) cannot exclude remote good faith junior users who used prior to federal registration. Cf. United Drug Co . v. Theodore Rectanus, Co., 248 U.S. 90 (1918). Indeed, they cannot exclud e local, post-registration , users who op erate in geographically distant areas where the senior user does not do business and has no plans to d o business. See Dawn Donut Co. v. Harts Foo d Sto res, Inc., 267 F.2d 358 (2d Cir. 19 59). Similar re strictions exist with respect to the holders of registrations based upon an application (without use) under Section 44(e) (Paris Convention) or Section 66 (M adrid Protocol). There, international trade has prompted protection, but the consumer confusio n rationale has mod erated relief. I am excluding from this list at present the development of explicit dilution doctrine, which seeks to further producer interests apart from the classic confusion-grounded purposes of trademark law. Efforts to explain dilution protection as furthering consumer interests do seem a bit stretched. Cf. Ty, Inc. v. Perryman, 306 F.3d 509 (7th Cir. 2002 ).
93 92
91
23
helpful insofar as it helps to identify other objectives of trademark law that might be used more broadly to balance against reactive confusion-grounded arguments, whether in favor of expanded or contracted protection.94] IV. A PRESCRIPTIVE CRITIQUE OF REACTIVE LAWMAKING The typical reactive account of trademark lawmaking is prescriptively undesirable as well as being descriptively inaccurate. Trademark lawmaking is impoverished by failing explicitly to recognize that courts are making normative choices; they are not acting purely reactively. Conventional trademark thought will usefully be supplemented by considering whether a rule of trademark law seeks to reflect or to create a social norm. Conscious attention to this lawnorm dyad will help to illuminate the hard questions at the heart of contemporary trademark law. In particular, thinking about the possibility of a proactive approach will improve trademark lawmaking by reducing the path dependence of changes in trademark law, and allowing for proper discussion of competing costs and benefits. Courts would be able to develop trademark law in accordance with transparent policy objectives, rather than being driven off-course by policy proxies that cannot withstand challenge or, inappropriately are applied in later factual settings. Finally, it would explicitly introduce into trademark law a balancing of values that is prominently seen in copyright law, but that is largely ignored in trademark law. This would help recognize the genuine multivalence of trademark law. A. Transparency
If we confine ourselves to the rhetoric of reaction, we destroy the transparency of trademark law. For example, in Wal-Mart Stores, Inc. v. Samara Bros.,95 the
These additional objectives are often used by courts arguing for the development of trademark law in both directions. A notable example is the Sup reme Courts reference to comp etitiveness considerations in recent trade d ress jurisprudence. Although comp etitiveness considerations are more typ ically used to confine trademark law, in Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 775 (1992), the Court used those considerations to support the availability of inherently distinctive trade dress; in Qualitex Co. v. Jacobson Prods., 514 U.S. 159 (19 95), the Court referenced competition both to support the registerability of color per se and to emphasize the importance of functionality; in Wa l-Mart Sto res, Inc. v. Sam ara B ros. 529 U .S. 205 (2000 ) and TrafF ix Devices, Inc. v. Marketing Displays, Inc., 532 U.S. 23 (2001), the Courts concern for competition was used to limit trade dress protection. The increased importance of law and economics in trademark thought no doubt has focused attention on these questions. Cf. Dinw ood ie, Trade mark Jurisprud ence, sup ra note 1, at ___ (noting that competition arguments can cut both ways). 529 U.S. 205 (2000). The same is arguably true in another recent Scalia o pinion, Dastar Corp. v. Twentieth Century Fox Film Corp., 539 U.S. 23 (20 03). In Dastar, the plaintiff (Twentieth Century Fox) was the owner of a cop yright in a televisio n series b ased upon Pre sident Eisenhowers book Crusade in Europe . After that television series fell into the public doma in for failure to comply
95 94
24
Supreme Court held that product designs would only be protected upon proof of secondary meaning because, among other things, consumers were not likely to regard designs as source-identifiers.96 This proposition had no empirical support (although probably correlates generally with our intuitions). But in slightly more candid parts of the opinion, the Court did touch on some of the reasons why a more pro-defendant rule might have been attractive. In particular, the Court implicitly weighed what it saw as the minimal costs of forcing the owner of an inherently distinctive product design trade dress to prove secondary meaning, against the substantial fear that permitting trade dress plaintiffs to plead inherent distinctiveness would deter competition by inviting strike suits that would be hard to dismiss.97 And the Court also noted that producers had available to them other intellectual property regimes by which to protect product designs.98
with copyright renewal formalities, the defendant Dastar purchased tapes of the series, edited them, and added ad ditiona l material of it own a nd so ld the revised video tapes as its own product. The packaging for the product made no reference to the original television series: it said Produced and Distributed by a Dastar subsidiary. The plaintiffs sued under copyright law (based on other works that were still in copyright) and under Section 43(a) of the Lanham Act, arguing that Dastars conduct in failing to credit the source of the television series am ounted to reverse passing off. The Co urts holding is grounded in the fact that the failure to include a reference to Twentieth Century Fox or the television series was not a false designation of origin within the meaning of Section 43(a) b ecause origin could not be extend ed to the source of the creative content. Consumers would not be interested in that information; Dastar was the origin of the (physical) disk or tape in consume rs minds. This entirely untested empirical conclusion wa s, however, b olstered by concerns ab out interfering with the right to copy a work unprotected by copyright (a competing policy objective) and by concerns of disrupting commercial certainty (an additional policy objective) if a false designation of origin claim were upheld. (T he Court feared tha t the defendant would be sued if it had put the plaintiffs name on the altered film, and also sued as, in fact, it was if it omitted the name). These pragmatic concerns surely were im portant and should have been considered by courts. But by basing the conclusion upon what consumers think is said by the label on the DVD (or what Justice Scalia thinks consumers think is said by the label on the DVD ), the Court has countenanced finding for defendants in other circumstances where the (non-)use in question does appear to be a d esignation of o rigin. If that is what the Court wishes to hold for reasons of commercial certainty, then the existence of certainty should be the princ iple that guides the further development of this area of the law. But it is not; instead, the law will develop in line with Justice Scalias guesses regarding the meaning that consumers take from the term produced by on the label of a communicative product such as a DVD recording of a mo tion picture. See Graeme B. D inwoo die, Con currenc e and Con vergen ce of Rights: The Con cerns of the U .S. Suprem e Cou rt, in CROSSING B ORDERS : B E T W EE N T R A D IT IO N A L A N D A CTU AL (Groshiede and B rinkhof eds. 2005).
96
See Sa mara , 529 U.S. at 213.
See id. at 213-4; see also id. at 215 (The very closeness [of a design to the line between packaging and d esign] will suggest the existence of relatively small utility in adop ting an inherent distinctiveness principle, and relatively great consumer benefit in requiring a demonstration of secondary meaning).
98
97
See id. at 214.
25
But the doctrine under which the Court implemented these objectives is a doctrine rooted firmly in consumer association: consumers dont ordinarily regard product designs as distinctive, and thus we should impose a secondary meaning requirement. This masking of policy choices with doctrine is unhelpful because it prevents transparent debate, or litigation, of the relevant competing policy choices. It forces later courts to make decisions burdened by heavy constraints and often without sufficient guidance about the way the Court wishes to proceed. B. Losing Control of Policy Objectives
Relatedly, a failure explicitly to articulate a competing policy objective that overrides rather than merely is deemed to inform consumer understandings (as expressed by trademark law) risks losing sight of that competing policy objective as other doctrinal rules come into contact with the competing policy in drag. For example, concerns about competition surface frequently in trademark law.99 But even where competition is raised, the competing policy concerns are often too quickly wrapped in the raiment of consumer association or consumer confusion. Thus, the fact a mark may be needed by other producers to compete is often cited as a consideration that supports treating a mark as descriptive (rather than suggestive) and hence unprotectable.100 But that competitive consideration does not directly implicate the question whether a mark is in fact, as an empirical matter, descriptive or alternatively acts as a source-identifier.101 It would be better if, instead, we recognized that the conclusion that such a mark is descriptive (i.e., that consumers do not see the term as a source-identifier) is, in those circumstances, a cloak for a competing policy objective, namely, the preservation of competition. There will be other instances where a mark is, as an empirical matter, descriptive and thus not regarded by consumers as a sourceidentifier. It may be that such a term is also important for rivals to use for competitive purposes, but that might not be the case. For example, speedy is probably descriptive for courier services, but competitors can probably find synonyms that would be adequate substitutes. But by treating competitiveness as a subset of the inquiry regarding consumer association, rather than as an independent
Indeed, the Department of Justice initially opposed the Lanham Act because of fears about the effect on com petition. See Sigmund T imberg, Trade-Marks, Monopoly, And the Restraint of Competition, 14 L AW & C O N TE M P. P R O B . 323 , 360 (1949); See Edward S. Ro gers, The Lanham Act and the Social Function of Trade-Marks , 14 LA W & C O N TE M P. P R O B . 173, 183 (19 49).
100 99
See, e.g., Zatarain's, Inc. v. Oak G rove Smokeho use, Inc, 698 2d 786 (5th Cir. 1983 ).
See Dinw ood ie, supra note _ _, at __ _. Lets pu t aside for now the extent to which consumers might allow the need for others to use to affect whether they see a mark as po inting to a single source. The relationship between consumer association and producer need is dynam ic. See id. at __.
101
26
policy concern, we treat the SPEEDY mark (which does not implicate competition concerns) identically to the mark that we will not protect in order to preserve competition. Why does that matter?102 To appreciate the importance of candidly articulating the independent rationale, one need only hypothesize that the producers of the two marks found descriptive (one because of competitiveness considerations, the other because of empirical consumer reactions) are able to show secondary meaning.103 At that stage, both descriptive marks will become protectable indeed, after five years, the descriptiveness challenge will be unavailable because of incontestability. We might wish to develop rules of trademark law that treat one set of marks differently from the other. By draping the entire discussion in assumptions about consumer behavior (i.e., framing the protection of trademark law as entirely reactive), we preclude that type of nuanced analysis, and the competing policy objective of competition is overwhelmed by the reactive force of trademark law (and by the social norm of protecting consumer association that it sanctifies).104 C. Failure to Recognize Multivalence of Trademark Law
The incompleteness of the reactive lawmaking vision causes us to fail to recognize multiple interests at stake in trademark disputes: against consumer protection, there are issues of competition, free speech, integrity of the patent system, expressions of personal identity, all of which might be implicated by trademark law. These are insufficiently debated as competing values. [examples: parody; values of brand obsessions: The modern view of trademarks as more than mere indications of source clearly reflects how consumers actually use
[This analysis contains echoes of pre-directive German trademark rules about the need to keep free; can a similar phenomenon can be found in that case law, or in the post-Windsurfing case law of the ECJ on this topic since the directive.] See R ESTATEMENT (T HIRD ) OF U NFAIR C O M P E TIT IO N , 13(b) (1995 ) (secondary meaning is established when as a result of the use o f a term, prospective p urchasers have co me to perceive it as a designation that identifies goods or services of a single producer). The Euro peans are in the mid st of a de bate at present as to whether there is a policy value of whether a mark needs to be kept free for use by others that should be superimposed upon the basic descriptiveness inquiry, as was the case under German law prior to harmonization. But there, as in the United States, the debate is largely about the considerations that lead to a conclusion of descriptiveness, rather than an e ffort to articulate an affirmative com peting policy that might have substantive doctrinal consequences.
104 103
102
27
marks in a brand-conscious society, 105 and thus scholarly and judicial disagreement centers on the normative question: should trademark law protect signals of affiliation and endorsement? Should trademark law protect the full panoply of human reactions and consumer meaning induced by brands?] D. Reducing Path Dependence
The reactive vision also causes a path dependence in trademark lawmaking that destroys the balance that might exist in trademark law. Some examples of broader trademark protection have come as a result of Congress (or the courts) seeking to facilitate economic expansion or to ensure a climate of certainty for trademark owners. When that has happened, the consumer confusion rationale has operated to prevent overbroad protection to trademark owners that take advantage of such nonconfusion based expansions.106 More typically, however, tying trademark law unquestioningly to the prevention of confusion has led to a ratcheting up of trademark protection. This seems to occur in two distinct ways. Both involve trademark law establishing social norms, but ultimately purporting only to vindicate and act upon norms that already exist. A notable example of the first way that the reactive approach ratchets up trademark protection is merchandizing. It was only in the 1970s that trademark owners became relatively secure in their ability legally to control the merchandizing of their marks.107 The early cases sustaining relief for plaintiffs talk primarily of the commercial value of the plaintiffs marks as a result of the plaintiffs efforts and the fact that commercial practices had grown up under which trademark owners (in the early cases, sports franchises) had engaged in merchandizing activities. Such rationales
105
As Judge Alex Kozinski has noted: There's a growing tendency to use trademarks not just to identify products but also to enhance or adorn them, even to create new commodities altogether. There was a time when the name of a shirt's manufacturer was discreetly sewn inside the collar. Izod and Pierre Cardin changed all that, making the manufacturer's logo an integral part of the product itself. Do you like a particular brand of beer? Chances are you can buy a T -shirt that telegraphs your brand loyalty. Some people put stickers on their cars announcing their allegiance to the Grateful Dead. Go figure. Alex Ko zinski, Trademarks Unplugged , 68 N.Y.U. L. R EV . 960 (1993). Indeed, these extended forms of meaning m ight represent the principal economic value o f marks. See [Cambridge paper]. As noted above, there are some cases where consumer confusion has been used to m ode rate relief that is available, but that has tend ed to be wh ere protection has been offered liberally in the first place for som e reasons external to the classic p urpo ses of tradem ark law. For example, [D awn D onut, section 44(d).] See, e.g., Boston Professional Hockey Assn, Inc. v. Dallas Cap & Emblem Mfg., Inc., 510 F.2d 100 4 (5th Cir. 1975).
107 106
28
are not the classic confusion-based rationales of trademark law, as some early courts acknowledged. (The courts did try to address the question of likely confusion, as the statute demanded, but the reasoning on confusion is often so stretched as to merely confirm the misappropriation or unfair competition impulse on which the court acted.).108 The conceptual shakiness of these decisions within the classic confusion model continues only so long, however. After the first of these decisions, producer behavior and consumer expectations both internalized the implications of trademark law. The accretion of case law engendered the actual (or assumed) consumer attitudes that were then used to advance trademark law in that same direction under a rubric that seemed less subject to challenge as lying outside the core objectives of trademark law. Thus, the illegitimate child of trademark litigation, merchandizing, has been legitimated by the trademark law-induced social norms that now include licensing programs, expected payment, and radically revised consumer expectations. The social norms, and the confusion, have absolved the early weakness of the doctrine. Merchandizing cases can now be litigated as confusion cases, without blushing. A second way that a ratchet effect ensues from a reactive approach is where the courts have not so explicitly distorted the basic rationale in early case law but have found confusion based upon assumptions of consumer behavior in the early stages of a social development. An example of this is early case law addressing the availability of relief for initial interest confusion involving unauthorized online uses of a mark.109 It may well be that in the early stages of commercial behavior online, and with respect to particular types of use, some levels of confusion might have been engendered through initially being presented by a web site that did no conform to the users expectations. But in their zeal to eliminate any potential, perhaps temporary, confusion, courts have contributed to legal rules that act on the assumption that confusion is indeed likely. As a result, they may have effected a premature regulation of the marketplace.110 In this second group of cases, reliance on property concepts or protection of investment was not so explicit, although dissenting judges in several cases pointed out that courts were effectively offering property-like protection.111 Instead, relying
See Stace y L. Dogan and Mark A. Lemley, The Merchandising Right: Fragile Theory or Fait Acco mp li? , 54 E M O R Y L. R EV . 461 (2005 ).
109
108
See, e.g., Brookfield Comm s., Inc. v. W est Coast Ent. Corp., 174 F.3d 1 036 (9th Cir.
1999).
110
Some courts are beginning to resist initial interest co nfusion doctrine. See sup ra note __. See, e.g., [Kenned y in Ferrari.]
111
29
on fragile evidence of consumer confusion or intuitions about consumer purchasing habits, courts found for the plaintiff in particular cases. And that legal decision builds up expectations, and encourages practices that come over time to corroborate and fulfil the prophecy of the first case. A slower, more proactive, approach to these cases might have asked about the policies that we wish to develop with respect to the provision of information online. E. Losing the Opportunity to Develop Necessary New Approaches
Finally, the purely reactive approach means that courts miss the opportunity to develop remedial rules that might more usefully develop trademark law in ways that reflect increased conflicts, whether with other intellectual property rights, with other countries, with other legal interests, that have been caused by the enhanced prominence of trademarks in the national and global economy. For example, in Kellogg Co. v. National Biscuit Co.,112 the U.S. Supreme Court considered whether the National Biscuit Company (Nabisco) could use trademark and unfair competition law to obtain relief that might effectively have extended rights it held under patents that had since expired. For several years Nabisco had been the exclusive manufacturer of pillow-shaped wheat biscuits known as SHREDDED WHEAT because it held design patents on the shape of the biscuits as well as utility patents on the product and the machinery with which the biscuits were made. Upon expiry of the patents, a rival manufacturer (Kellogg) wished to sell goods of the same shape under the name SHREDDED WHEAT. The Supreme Court held that Nabisco could not enjoin the manufacture of biscuits in the pillow-shape because to do so would interfere with the premise of patent law that once a patent has expired the public has the right to practice that invention. Moreover, the Court also suggested that the shape had become generic, having become primarily associated with the article rather than a particular producer.113 The Court held that Kellogg could also use the term SHREDDED WHEAT because either the term was generic or because as Kellogg had the right to make the article it also had the right to use the term by which the public knows it.114 Although the Kellogg Courts invocation of alternative grounds for decision makes it difficult to determine the real basis for the Courts decision, it is important to note that with respect to the protection of both the shape and the term, the Court offers one
112
305 U .S. 111 (1938 ).
See id. at 120. The Co urt would also have denied protection for the shape on the additional ground that the shape was functional, in that the cost of the biscuit would be increased and its high quality lessened if some other fo rm were substituted for the pillow-shap e.
114
113
See Kellogg, 305 U.S. at 118.
30
explanation that is based on a reactive view of trademark law and one that assumes a much more proactive approach to trademark lawmaking. Determinations that the shape and the term were generic clearly reflect consumer understanding; trademark protection follows naturally (and reactively) from social meaning. In contrast, when the Court invokes the right to copy the shape of a product covered by the expired patent, and the concomitant right to use the name by which the patented article was known, the Court is elevating competing policy values (arguably over the value of consumer association). Trademark law, in this latter analysis, is not subservient to the value of protecting consumer association; instead, it is consciously over-riding any consumer association. To be fair, because of the Kellogg Courts recitation of several grounds for decision, this over-riding is not explicit.115 One could argue that if the mark were generic, there would be no consumer association to implicate the affirmative purposes of trademark law. Yet, the Supreme Court clearly was unsure of its conclusion that there was no consumer association attaching to the shape and the term, a conclusion that rendered both generic. In particular, the Court acknowledged that Nabisco had demonstrated what has in later times come to be called de facto secondary meaning, that is, some degree of consumer association in fact even if the competing policy values of the patent system mandated that the Court not recognize it as legally protectable. The Court had thus been presented with a situation where it wished to protect consumer association that in fact existed but which, in effectuation of competing policy values, it declined to protect fully. In balancing these competing objectives, the Court recognized that Nasbisco would be entitled to require that the defendant use reasonable care to inform the public of the source of its product. This relief enabled Kellogg to exercise its right to copy consistent with as full a protection of source-identification as would not undermine that right. Recognizing the need to balance consumer confusion against competing objectives might also lead to an appropriate and conscious acceptance by courts that some confusion may be acceptable as a matter of trademark policy. Limiting protection for certain types of marks will encourage producers, where possible, to use other types of symbol as forms of source-identification. Thus, the argument runs, if we value certain types of symbols (e.g., descriptive terms, product designs) for uses other than source-identification, we should preserve those alternative uses by discouraging the uses of those symbols as marks. There are limits to the effectiveness of this strategy, of course. As the Supreme Court acknowledged in Qualitex, sometimes the nature
Very few courts have been presented with, and been willing to confront, the issue of balancing these competing choices head-on. For an exception, see Vornado Air Circulation Sys. v. Duracraft Corp., 58 F.3d 14 98 (10th Cir. 1995).
115
31
of the product precludes the use of traditional forms of source-identification. And the symbols used by consumers to identify and distinguish goods are not entirely within the control of producers. But even within those limits, and accepting the reality that some producers will try to assert rights in these very symbols to achieve competitive advantage, it does appear that one strain in current Supreme Court jurisprudence is to encourage producers to select as marks symbols that do not implicate useful alternative uses.116 F. Balancing in Trademark Law The development of rules of trademark law, which are part of the broader law of unfair competition, or the adjudication of trademark claims, should reflect a balance between the rights of competitors and producers. Trademark law is, however, rarely developed or decided in this fashion, in contrast to copyright law. Instead, courts and scholars tend to plot their intellectual courses by the twin (and classically convergent) lodestars of consumer protection and the protection of producer goodwill. But asking these questions often affords little insight into what rule should be adopted or what decision made, although no doubt they accurately (if incompletely) describe the dominant normative underpinnings of modern trademark law. Purely reactive analysis precludes a fair weighing of competing interests; by putting a heavy thumb on the scale, confusion trumps. Balancing interests, and exploring whether an additional policy objective sustains or undermines or modifies a conclusion derived simply from analysis of confusion, enables a fuller assessment of the different policy implications raised by a trademark problem. It also encourages courts to be aware of relief that might be more closely tailored to the several effects to which trademark law must attend. This is seen, for example, as discussed above, in the context of courts granting limited (labeling) relief where a distinctive term or shape should be free to be copied in order to effectuate polices of free competition or to maintain the integrity of the patent bargain.
See Dinw ood ie, Trade mark Jurisprudence , supra note 1, at __. A vigorous fair use doctrine that countena nced the defense even where confusio n was likely to persist, would encourage producers to select marks that are suggestive or arbitrary. See Oral Argument in KP Permanent Make up v. Lasting Impression I, Inc. (Question by Justice Scalia), available at 2004 WL 234 0185 at * 9 (Oct. 5, 2004). To be sure, the fair use doctrine can b e asserted with respe ct to the descriptive use of a sugge stive mark. See Brother Records, Inc. v. Jardine, 318 F.2d 900 (9th Cir. 2003). Ho wever, given the lack of a connection between the product and a suggestive market, the descriptive use of that mark is likely to be on a product somewhat dissimilar to the product on which the suggestive mark was used, and thus actionable confusion is less likely to occur. T hus, the making out of the fair use defense despite likely confusion is mo st likely to occu r with respect to the use of descriptive marks.
116
TRADEMARK LAW AND SOCIAL NORMS V. A PROACTIVE APPROACH TO TRADEMARK LAW
32
All this begs a question, of course. If a reactive account of lawmaking is insufficient as a descriptive explanation or a prescription for ideal trademark lawmaking, what is the alternative? Most importantly, what are the goals or policies that we might want to pursue in tandem with (not as alternatives to) protecting consumer association against likely confusion? As a first step, courts can explicitly articulate considerations that already inform trademark law even though courts currently wrap them up doctrinally in their discussion of consumer association: notable examples are competition, freedom of speech, and public health (in drug cases). These values are often reflected in the rhetorical of trademark courts, although they rarely gain doctrinal purchase except in discrete areas (such as functionality). This addition to trademark lawmaking would help complete our account of trademark law by supplementing the set of core values embodied in the language of consumer association and likely confusion. Second, courts should bring into the open other unspoken principles that inform trademark law. These principles are not the first order values of fair competition and free speech discussed above, but more prudential principles that can be detected underlying current case law. I have previously suggested a number of these principles: as commercial certainty, reduction of searching costs, the incentives to expand trade geographically, encouraging the selection of marks that are highly distinctive, or limiting cumulation of protection. Others, such as Robert Bone, have focused on the notion of enforcement costs (encompassing both administrative costs and error costs). This too is an act of supplementation. As a third step, both courts and scholars should broaden the lenses through which we view and implement the basic consumer association and confusion-avoidance goals of core trademark law. Thus for example, Stacey Dogan and Mark Lemley have worked through the liability of search engines for paid-for results keyed to rivals trademarks by asking not merely whether consumers are confused by such practices but whether the availability of sponsored links reduce search costs for consumers, an objective of trademark law that falls within the standard law and economics account, an account that also accommodates and promotes the confusion-avoidance rationale.117 Likewise, Barton Beebe has asked how semiotics might help us to make better assessments of the way that trademarks build up meaning for consumers.118 Both these examples seeks to ground the existing consumer protection theory within
117
See Do gan & Lemley, supra note __, at __. See Barton B eebe, The Sem iotic Analysis of Tra dem ark L aw, 51 U.C .L.A. L. R EV . 704
118
(2004).
33
a broader account of trademark law that subsumes both the dominant account to date and these additional concerns. Fourth, and much more radically, trademark policymaking could incorporate more fundamental critiques of trademark law. These critiques are proliferating in other disciplines and reflect a number of concerns, such as the harms of advertising in creating false desires, or anti-materialist philosophies that identify branding as a principal vehicles for effectuation of harmful social values. Likewise, commentators have recognized that social minorities may need to appropriate trademarks in order to preserve identity. More generally, trademark law currently demonstrates a fidelity to markets that tends to elevate freedom as a defining philosophical principle. But individual autonomy and other more humanist values are potentially imperilled by contemporary social developments that revolve around brands. Many of these critiques were also tendered in the mid-twentieth century and rejected, but it seems entirely appropriate that trademark law reconsider (and if necessary, rebut) the arguments given the centrality of trademarks to modern life. Again, this is a broadening of the vision through which we currently assess trademark law, but here it is by setting up competing visions that focus on the social effects of trademark law not currently accommodated within trademark law, rather than visions that accommodate multiple existing justifications for trademark law. Finally, courts might consider developing new prudential principles to inform trademark standard such as fair use, or be balanced against the likelihood of consumer confusion. For example, we might, by analogy to copyright law, consider giving weight to the value of interoperability of products; to some extent, trademark law recognizes this value in the latitude afforded producers who use a mark in comparative advertising rules and in the fair use doctrine.119 Likewise, as trademark law increasingly assumes an important role in structuring innovation policy,120 courts
119
Cf. Gillettte.
See Chris N uttall, Way of the Web: Start Ups Ma p Th e Ro ute as Big Riva ls Get Microsoft in Their Sigh ts, F IN . T IMES , Nov. 17, 200 05, at 17 (discussing Microsoft assessment of future business models). Many scholars have expressed concern about conceiving of trademark law in terms that recognize its ability to incentivize behavior. These concerns have been most vocal in the context of product design trade dress claims. In that context, concern has been expressed that producers have used trademark law as a de facto p atent law. Courts and scholars seeking to p rotect against that misuse of trademark law have stressed that trademark law, unlike patent law and copyright law, was not intended to encourage creativity. See Dastar Corp. v. Twentieth Century Fox Film Corp., 539 U.S. 23, 34 (2003) (The Lanham Act we have said, does not exist to rewa rd manufac turers for their innovation in creating a particular device; that is the purpose of the patent law and its period of exclusivity) (q uo tin g T rafF ix D ev ices, Inc. v. M arketing Disp lays, Inc., 532 U .S. 23 (2001)); see also Qualitex Co. v. Jaco bson Pro ds., 51 4 U .S. 15 9, 16 4 (1995 ) (noting that it is not the province of trademark law to encourage invention). But the Supreme Court has properly recognized that a
120
34
might provide a defendant some room for maneuver, and permit more confusion than usually acceptable, in the early stages of the development of a technology with legitimate uses. A parallel principle of latitude was articulated by the Ninth Circuit in the context of making copyright fair use determinations121 and perhaps could be developed in the trademark context under the general rubric of articulating information policy. Conclusion This Article does not seek to provide a single meta-theory of trademark law that will serve proactively to supplement our traditional reactive vision. Trademark law and trademark rights simply do too much in modern society to provide a unitary theory. Rather, I hope to offer the framework for that more complete account of what trademark law is and what trademark law should be. That involves identifying from closer analysis, and bringing into the open, the many variables already effectively driving trademark law, both in terms of first order values and prudential principles. The Article clearly has its own normative momentum. But the more important contribution is to open up the debate for a whole range of courts and scholars to develop in a transparent fashion the range of values that should inform modern trademark law.
corollary of pro tecting the goodwill of m arks is the resultant incentive to invest in the quality of good s. Any protection will structure conduct. Provided that incentive is viewed through a consumer protection lens, the dangers can be lived with.
121
See Kelly v. Arriba

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TRADEMARK LAW AND SOCIAL NORMS Graeme B.

TRADEMARK LAW AND SOCIAL NORMS

TRADEMARK LAW AND SOCIAL NORMS

TRADEMARK LAW AND SOCIAL NORMS

See Dinw ood ie, supra note 10, at __-__.

TRADEMARK LAW AND SOCIAL NORMS

TRADEMARK LAW AND SOCIAL NORMS

TRADEMARK LAW AND SOCIAL NORMS

S. Rep. No. 13 33, 79th Cong., 2d Sess. 3 (1946 ).

TRADEMARK LAW AND SOCIAL NORMS

[insert cites to recent SCOT US op inions citing S. Rep].

TRADEMARK LAW AND SOCIAL NORMS

See Pub. L. No. 87-77 2 (1962 ).

See 15 U.S.C. 1117(b); 15 U.S.C. 1117(c); 15 U.S.C. 1129.

TRADEMARK LAW AND SOCIAL NORMS

[judicial critiques of dilution].

TRADEMARK LAW AND SOCIAL NORMS

See Denicola, supra note __, at __.

TRADEMARK LAW AND SOCIAL NORMS

TRADEMARK LAW AND SOCIAL NORMS

TRADEMARK LAW AND SOCIAL NORMS

TRADEMARK LAW AND SOCIAL NORMS

TRADEMARK LAW AND SOCIAL NORMS

TRADEMARK LAW AND SOCIAL NORMS

See id. at ___.

TRADEMARK LAW AND SOCIAL NORMS

[also S terling D rug: mu ltinationals; satellite.]

TRADEMARK LAW AND SOCIAL NORMS

TRADEMARK LAW AND SOCIAL NORMS

125 S.Ct. 542 (2 004).

See KP Permanent, 125 S.Ct. at ___.

TRADEMARK LAW AND SOCIAL NORMS

TRADEMARK LAW AND SOCIAL NORMS

TRADEMARK LAW AND SOCIAL NORMS

See Sa mara , 529 U.S. at 213.

See id. at 214.

TRADEMARK LAW AND SOCIAL NORMS

TRADEMARK LAW AND SOCIAL NORMS

TRADEMARK LAW AND SOCIAL NORMS

TRADEMARK LAW AND SOCIAL NORMS

TRADEMARK LAW AND SOCIAL NORMS

305 U .S. 111 (1938 ).

See Kellogg, 305 U.S. at 118.

TRADEMARK LAW AND SOCIAL NORMS

TRADEMARK LAW AND SOCIAL NORMS

TRADEMARK LAW AND SOCIAL NORMS V. A PROACTIVE APPROACH TO TRADEMARK LAW

TRADEMARK LAW AND SOCIAL NORMS

TRADEMARK LAW AND SOCIAL NORMS

See Kelly v. Arriba

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See Dinw ood ie, supra note 10, at -.

See Denicola, supra note , at .