‘E&P’ Column on Trademark Law Draws Questions, and Reply

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By: E&P Staff

Two readers react to Steven Yahn’s column about trademark law and then Yahn responds to their letters.


I read Steven Yahn’s April 22, 2006 article entitled New Trademark Law Might Restrict Free Speech and think he misunderstands the proposed amendments to the dilution provisions of the Lanham Act.

The dilution section of the Lanham Act, 15 U.S.C. s. 1125(c), provides that if a trademark is famous, its owner — in addition to a claim for infringement — may bring a separate claim for dilution. There are exceptions to this right: fair use of a famous mark by another person, noncommercial use of a mark, and all forms of news reporting and news commentary are NOT actionable.

While it would be bad for newspapers if the fair use and first amendment exceptions were deleted, these exceptions are present in the proposed amendment to the Lanham Act.

Stacy Grossman
Vice President and Associate General Counsel
News America Incorporated
New York, NY

In your April 22 article you reported that three exclusions have been removed from the current version of H.R.683- “The Trademark Dilution Revision Act.” According to your article these are news reporting and commentary, fair use, and non-commercial use. In the Senate version of H.R. 683, passed on March 8, 2006 and returned to the House for a final look, the three exclusions were in the bill in Sec. 2(C)(3). Is there another version which I am unaware of? Thanks for any information you can provide.

Hugh Latimer, partner
Wiley Rein & Fielding LLP
Washington, D.C.


Steven Yahn responds:

Hugh Latimer and Stacy Grossman both object that my column was wrong to warn that H.R. 683 as recently passed the Senate, and now pending for final consideration in the House, eliminates three express exemptions that the Lanham Act now provides against many infringement claims.

The column was based on an ever-so-subtle change in language from ? 43(c)(4) of the current statute to ? 43(c)(3) in the Senate bill, which is where the ?exclusions? language now appears. The difference is so subtle that it is not surprising that the two able lawyers who have written about my column missed it. In fact, most of the attention has been paid to the subparagraphs of 43(c)(3), but that is not where the problem lies. The problem is in the introductory language of 43(c)(3).

In the current statute, 43(c)(4) reads, in its entirety, ?The following shall not be actionable under this section.? In the bill, the comparable language in 43(c)(3) reads, ?The following shall not be actionable as dilution by blurring or dilution by tarnishment under this subsection.? So, the effect of the change in language comes from the addition of the prefix ?sub? to the word ?section,? and the addition of the extra words about dilution.

If you look at legislative drafting manuals, you will see that the word ?section? has a very specific meaning ? it refers to the Arabic numeraled ?sections? of the United States Code. The word ?subsection,? in turn, refers to the portions of sections that have lower case letters beginning with ?(a).? Thus, ?this section? refers to section 43, while ?this subsection? refers to subsection (c) of section 43. Last year, the Supreme Court endorsed this hierarchy of drafting terms in a case called Koons Buick v. Nigh.

These terms are used consistently throughout section 43. Begin by looking at provision 43(b). It bars the importation of goods labeled ?in contravention of the provisions of this section.? 43(b) does not specify anything that could be contravened. The provision obviously uses the term ?section? to refer both to 43(a) and 43(c). By contrast, provisions 43(a)(2), 43(c)(1), and 43(c)(2) of the statute all use the word ?subsection? to refer, in context, to subsection (a) or (c). (The bill eliminates the term ?subsection? in 43(c)(1), but the reference in 43(c)(2) is now moved to 43(c)(4), which uses the term repeatedly).
In short, there can be no doubt, when you look very closely, what the authors of this bill are doing, and they have very nearly pulled it off without anybody noticing, including my two correspondents.

The damaging effect of the change in the bill is that section 43(a) is a key provision for enforcing trademarks ? it is the only way to prevent infringement of an unregistered trademark (such as the trade dress claim that was threatened against artist Don Stewart) and it provides an alternate means of preventing infringement of registered trademarks. Therefore, by the mere elimination of the three-letter prefix ?sub,? the bill opens a major loophole by eliminating the three defenses that the subparagraphs of 43(c)(4) now apply to all claims under 43(a).

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