WHAT’S IN A NAME?
The United States of America likes to call it simply the “famous marks”, whereas India likes to refer to it as the “well known marks”. However, “dilution” is a concept that is not only common to both countries but is a global predicament concerning trademarks.
FAMOUS MARKS -
United States
The term “famous marks” has not been defined anywhere under the US law, but is determined on a case-to-case basis. To prove dilution of a famous mark one has to prove the lessening of the capacity of the famous mark. However, given that the term famous marks is not defined, it becomes difficult to quantify the lessening of capacity, of a thing which posses no exact parameters!
India
India, as I mentioned earlier, chose to refer to the same as “well-known marks”. This concept was introduced through the Trade Marks Act, 1999 (TMA).
Section 2 (1) (zg) of TMA defines a well-known trade mark as "in relation to any goods or services, means a mark which has become so to the substantial segment of the public which uses such goods or receives such services that the use of such mark in relation to other goods or services would be likely to be taken as indicating a connection in the course of trade or rendering of services between those goods or services and a person using the mark in relation to the first –mentioned goods or services."
Therefore, the first point of difference is that famous marks though not defined like well-known marks, set forth an impression of all that it could be. It has been left open for courts to determine whether or not a mark qualifies as famous or not. The dilemma herein is that different courts might subject differential treatment to the same mark in different states.
DILUTION -
United States
The concept of “dilution” was introduced through its Federal Trademarks Dilution Act (FTDA). The new act defines the term "dilution" as "the lessening of the capacity of a famous mark to identify and distinguish goods or services, regardless of the presence or absence of –
i. competition between the owner of the famous mark and other parties, or
ii. likelihood of confusion, mistake, or deception."
The definition of dilution under the FTDA certifies that famous marks, to prove the dilution of their mark, need not prove likelihood of confusion or competition. The general guidelines are – distinctiveness, duration and extent of use, geographical extent, channels of trade, use by third party, recognition, advertising and valid federal registration.
"Blurring" typically refers to the "whittling away" of distinctiveness caused by the unauthorized use of a mark on dissimilar products.
"Tarnishment" involves an unauthorized use of a mark which links it to products that are of poor quality or which is portrayed in an unwholesome or unsavory context that is likely to reflect adversely upon the owner's product.
India
Dilution spawned its wings under the umbrella of “Bad faith”. A mark is said to have been registered in bad faith when it violates the rights of well-known marks. An existent well-known mark takes away the option of a latter mark wanting to register with the same mark. The refusal to grant approval of a trademark similar to a well-known mark is independent of the category, whether goods or services. The use of the latter mark without due cause would amount to taking unfair advantage or be detrimental to the distinctive character or repute of the earlier trademark.
As apposed to the US law, dilution has not been specifically defined, only recognized through the statutory protection given to well-known trademarks. Divergence of the two legal systems becomes evident from the fact that under the US system, one is required to prove actual dilution, i.e., actual confusion. However, under the Indian system, just the mere threat or hint of probable confusion is sufficient to appeal for passing off.
RELIEF:
INJUNCTIVE RELIEF -
United States
Injunctive relief is available under the new law. However, if the defendant willfully intended to trade on the owner's reputation or to cause dilution of the famous mark, the owner of that mark may also be entitled to other remedies available under the United States Trademark Act, including defendant's profits, damages, attorneys' fees, and destruction of the infringing goods.
India
The available relief is called passing off for well-known marks which are not registered in India. Injunctions may be granted even if there is a probability of confusion or deception. Court may grant the relief of injunction.
MONETARY RELIEF -
United States
The availability of monetary relief is a striking departure from state dilution laws, which have typically provided only for injunctive relief. Interestingly, the new law also provides that the ownership of a valid federal registration is a complete bar to the assertion of a dilution claim under state law, thereby effectively pre-empting state dilution laws.
India
The Court in certain cases does grant either damages or an account for profits with or without any order for delivery of the infringing labels and marks for destruction or erasure.
Indian and American laws both purport the existence of dishonest intention being present on part of the defendant (who has violated), to establish a claim to injunctive relief. However, it is worth noting that India does not require the well know mark to be registered. The US while determining the famousness of a mark does take into consideration whether or not it was registered under the Act of March 3, 1881, or the Act of February 20, 1905, or on the principal register.
EXEMPTION:
United States
Fair use, use in editorial commentary, non-commercial, news reporting/commentary exempts the use of famous marks.
India
The use of well-known marks is not violative as long as the use of such mark is in accordance with honest practices in industrial or commercial matters and has not amounted to having taken unfair advantage of or having been detrimental to the distinctive character or repute of the trademark.
Thus, generally speaking the principle of fair use is permitted and upheld in both legal regimes.
CASES:
United States
MOSELEY’S CASE -
* Victor Moseley and his wife opened a store containing women’s lingerie, adult movies and related goods.
* Victoria Secret Catalogue Inc. (VSC) objected and Victor changed the name of store from Victor’s Secret to Victor’s Little Secret. VSC filed for tarnishment and the district Court upheld the allegation, primarily as the mark of VSC is well known and FAMOUS. Thus of enormous value.
* Supreme Court reversed and justified its certiorari stating that there was never any actual impact shown by the use of junior mark.
* The FTDA requires that the condition for likelihood of dilution be met, irrespective of likelihood of confusion.
* Supreme Court in this case went a step further and laid down that actual dilution was required to be proved.
* Actual dilution was in no means the simple certification of economic losses caused by the use of the junior mark, but showing that the defendant’s mark was identical to that of the planintiff.
* By that, the identities of the mark itself are proof as circumstantial evidence of the actual dilution.
Though only two cases (Four Season's Hotel Case and Pinehurst Case) meeting this requirement of having identical marks to prove actual dilution have been seen, and even so they have little application beyond the specifics of the respective cases.
NEGATIVES OF THE DECISION IN MOSELEY’S CASE -
The Court failed to state –
* What are the alternatives to surveys to prove actual dilution
* When surveys are unnecessary to prove actual dilution
* What a survey must show to prove actual dilution
India
WHIRLPOOL CASE -
Whirlpool Corporation had failed to renew its trademark post the trade restrictions imposed after 1977. However, the Delhi High Court was of discontinuity of maintenance a well-known mark does not allow another to adopt that mark. Whirlpool succeeded in its plea of passing off and gained an injunctive relief in the matter.
POSITIVES OF THE DECISION IN WHIRLPOOL CASE -
It was this case which introduced into the veins of the Indian legal system, the concept of dilution. Though it never adopted or defined the term dilution per se, it did surely recognize it.
CONCLUSION:
ACTUAL DILUTION V. MERE CONFUSION -
Under the American system actual dilution doesn’t merely require identical marks as circumstantial evidence, but also that there has been a lessening in capacity of the plaintiffs marks by use of the junior mark.
The difference in the outlook of the American and Indian law is evident from the manner of what quantifies a ground for causing confusion. In the Indian context, it was no longer necessary to prove that there had been actual harm caused or confusion created. Just the threat of it being a possibility was enough to set the cause in motion to acquire an injunctive relief.
Thus, in the US one has to qualify as having a famous mark in the eyes of the judge and prove actual loss by the junior mark being identical supported by surveys. Indian laws require you to simply prove slight possibility of confusion. US laws are thus, far more stringent in this regard, in comparison to the Indian counterpart.
ETCETRA ETCETRA:
Indian Companies Act through its amendments has now specified that incase a Company becomes aware of another company having the same name or similar name; the Company who originally registered its name and is a well-known mark nonetheless, can bring the situation to the notice of the Central Government. The central Government on affirming such situation may direct the latter offending company to change its name within three months.
FAMOUS LAST WORDS:
Either country takes its roots from common law principles and I find it intriguing to see that there are still differences in approaches to similar concepts, be it famous marks or well-known marks. Shakespeare’s most loved phrase of “What’s in a name?” remains loved unto date for a good reason. After all, time has unfolded to explain the irony in that statement because as far as trademarks go –
FAMOUS MARKS AND DILUTION:
FAMOUS MARKS -
United States
The term “famous marks” has not been defined anywhere under the US law, but is determined on a case-to-case basis. To prove dilution of a famous mark one has to prove the lessening of the capacity of the famous mark. However, given that the term famous marks is not defined, it becomes difficult to quantify the lessening of capacity, of a thing which posses no exact parameters!
India
India, as I mentioned earlier, chose to refer to the same as “well-known marks”. This concept was introduced through the Trade Marks Act, 1999 (TMA).
Section 2 (1) (zg) of TMA defines a well-known trade mark as "in relation to any goods or services, means a mark which has become so to the substantial segment of the public which uses such goods or receives such services that the use of such mark in relation to other goods or services would be likely to be taken as indicating a connection in the course of trade or rendering of services between those goods or services and a person using the mark in relation to the first –mentioned goods or services."
Therefore, the first point of difference is that famous marks though not defined like well-known marks, set forth an impression of all that it could be. It has been left open for courts to determine whether or not a mark qualifies as famous or not. The dilemma herein is that different courts might subject differential treatment to the same mark in different states.
DILUTION -
United States
The concept of “dilution” was introduced through its Federal Trademarks Dilution Act (FTDA). The new act defines the term "dilution" as "the lessening of the capacity of a famous mark to identify and distinguish goods or services, regardless of the presence or absence of –
i. competition between the owner of the famous mark and other parties, or
ii. likelihood of confusion, mistake, or deception."
The definition of dilution under the FTDA certifies that famous marks, to prove the dilution of their mark, need not prove likelihood of confusion or competition. The general guidelines are – distinctiveness, duration and extent of use, geographical extent, channels of trade, use by third party, recognition, advertising and valid federal registration.
"Blurring" typically refers to the "whittling away" of distinctiveness caused by the unauthorized use of a mark on dissimilar products.
"Tarnishment" involves an unauthorized use of a mark which links it to products that are of poor quality or which is portrayed in an unwholesome or unsavory context that is likely to reflect adversely upon the owner's product.
India
Dilution spawned its wings under the umbrella of “Bad faith”. A mark is said to have been registered in bad faith when it violates the rights of well-known marks. An existent well-known mark takes away the option of a latter mark wanting to register with the same mark. The refusal to grant approval of a trademark similar to a well-known mark is independent of the category, whether goods or services. The use of the latter mark without due cause would amount to taking unfair advantage or be detrimental to the distinctive character or repute of the earlier trademark.
As apposed to the US law, dilution has not been specifically defined, only recognized through the statutory protection given to well-known trademarks. Divergence of the two legal systems becomes evident from the fact that under the US system, one is required to prove actual dilution, i.e., actual confusion. However, under the Indian system, just the mere threat or hint of probable confusion is sufficient to appeal for passing off.
RELIEF:
INJUNCTIVE RELIEF -
United States
Injunctive relief is available under the new law. However, if the defendant willfully intended to trade on the owner's reputation or to cause dilution of the famous mark, the owner of that mark may also be entitled to other remedies available under the United States Trademark Act, including defendant's profits, damages, attorneys' fees, and destruction of the infringing goods.
India
The available relief is called passing off for well-known marks which are not registered in India. Injunctions may be granted even if there is a probability of confusion or deception. Court may grant the relief of injunction.
MONETARY RELIEF -
United States
The availability of monetary relief is a striking departure from state dilution laws, which have typically provided only for injunctive relief. Interestingly, the new law also provides that the ownership of a valid federal registration is a complete bar to the assertion of a dilution claim under state law, thereby effectively pre-empting state dilution laws.
India
The Court in certain cases does grant either damages or an account for profits with or without any order for delivery of the infringing labels and marks for destruction or erasure.
Indian and American laws both purport the existence of dishonest intention being present on part of the defendant (who has violated), to establish a claim to injunctive relief. However, it is worth noting that India does not require the well know mark to be registered. The US while determining the famousness of a mark does take into consideration whether or not it was registered under the Act of March 3, 1881, or the Act of February 20, 1905, or on the principal register.
EXEMPTION:
United States
Fair use, use in editorial commentary, non-commercial, news reporting/commentary exempts the use of famous marks.
India
The use of well-known marks is not violative as long as the use of such mark is in accordance with honest practices in industrial or commercial matters and has not amounted to having taken unfair advantage of or having been detrimental to the distinctive character or repute of the trademark.
Thus, generally speaking the principle of fair use is permitted and upheld in both legal regimes.
CASES:
United States
MOSELEY’S CASE -
* Victor Moseley and his wife opened a store containing women’s lingerie, adult movies and related goods.
* Victoria Secret Catalogue Inc. (VSC) objected and Victor changed the name of store from Victor’s Secret to Victor’s Little Secret. VSC filed for tarnishment and the district Court upheld the allegation, primarily as the mark of VSC is well known and FAMOUS. Thus of enormous value.
* Supreme Court reversed and justified its certiorari stating that there was never any actual impact shown by the use of junior mark.
* The FTDA requires that the condition for likelihood of dilution be met, irrespective of likelihood of confusion.
* Supreme Court in this case went a step further and laid down that actual dilution was required to be proved.
* Actual dilution was in no means the simple certification of economic losses caused by the use of the junior mark, but showing that the defendant’s mark was identical to that of the planintiff.
* By that, the identities of the mark itself are proof as circumstantial evidence of the actual dilution.
Though only two cases (Four Season's Hotel Case and Pinehurst Case) meeting this requirement of having identical marks to prove actual dilution have been seen, and even so they have little application beyond the specifics of the respective cases.
NEGATIVES OF THE DECISION IN MOSELEY’S CASE -
The Court failed to state –
* What are the alternatives to surveys to prove actual dilution
* When surveys are unnecessary to prove actual dilution
* What a survey must show to prove actual dilution
India
WHIRLPOOL CASE -
Whirlpool Corporation had failed to renew its trademark post the trade restrictions imposed after 1977. However, the Delhi High Court was of discontinuity of maintenance a well-known mark does not allow another to adopt that mark. Whirlpool succeeded in its plea of passing off and gained an injunctive relief in the matter.
POSITIVES OF THE DECISION IN WHIRLPOOL CASE -
It was this case which introduced into the veins of the Indian legal system, the concept of dilution. Though it never adopted or defined the term dilution per se, it did surely recognize it.
CONCLUSION:
ACTUAL DILUTION V. MERE CONFUSION -
Under the American system actual dilution doesn’t merely require identical marks as circumstantial evidence, but also that there has been a lessening in capacity of the plaintiffs marks by use of the junior mark.
The difference in the outlook of the American and Indian law is evident from the manner of what quantifies a ground for causing confusion. In the Indian context, it was no longer necessary to prove that there had been actual harm caused or confusion created. Just the threat of it being a possibility was enough to set the cause in motion to acquire an injunctive relief.
Thus, in the US one has to qualify as having a famous mark in the eyes of the judge and prove actual loss by the junior mark being identical supported by surveys. Indian laws require you to simply prove slight possibility of confusion. US laws are thus, far more stringent in this regard, in comparison to the Indian counterpart.
ETCETRA ETCETRA:
Indian Companies Act through its amendments has now specified that incase a Company becomes aware of another company having the same name or similar name; the Company who originally registered its name and is a well-known mark nonetheless, can bring the situation to the notice of the Central Government. The central Government on affirming such situation may direct the latter offending company to change its name within three months.
FAMOUS LAST WORDS:
Either country takes its roots from common law principles and I find it intriguing to see that there are still differences in approaches to similar concepts, be it famous marks or well-known marks. Shakespeare’s most loved phrase of “What’s in a name?” remains loved unto date for a good reason. After all, time has unfolded to explain the irony in that statement because as far as trademarks go –
It's all in the name.
****
****
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