Trademark dilution law about to change

Some time in the next few days President Bush is expected to sign the Trademark Dilution Revision Act of 2006. [Full text of the Act] Among other things, the Act essentially overrules a significant portion of the Supreme Court’s 2003 Moseley decision, which held that in order to be successful, a dilution plaintiff must allege and prove actual dilution of its mark. The Act provides that a plaintiff must show a mere likelihood of dilution to sustain a claim.

Inasmuch as lowering the standard to “likelihood of dilution” may assist plaintiffs with part of their case, the Act makes another aspect more difficult. Certain circuits (including the Seventh) currently hold that a plaintiff need only show that its mark is well-known among a defined segment of the population (e.g., Star Trek fans) in order to be famous for trademark dilution purposes. This is known as “niche market fame.” The Act does away with niche market fame by providing that “a mark is famous if it is widely recognized by the general consuming public of the United States as a designation of source of the goods or services of the mark’s owner.”

Hat tip to John Welch for picking up on this legislation.