Seattle Trademark Lawyer

Apple’s iPod ad campaign has been copied and spoofed dozens of times. Nonetheless, Apple can’t be too happy about San Francisco-based Specialty’s Cafe and Bakery’s latest ads. I saw this placard yesterday in downtown Seattle. The worst of it is, these shops are quite good and well-known. Apple’s campaign is no longer fresh, and the link between ordering sandwiches and the Internet seems pretty weak. So why did Specialty’s copy Apple’s ads? It should be beneath them.

On Feb. 21, the Ninth Circuit took the unusual step of amending its six-month old decision in Jada Toys, Inc. v. Mattel, Inc., deciding the “new” standards established in the October 2006 Trademark Dilution Revision Act apply to Mattel’s dilution counterclaim, not the old standards set forth in the Federal Trademark Dilution Act. In doing so, the court applied the TDRA’s “likelihood of dilution” standard, four-factor test for assessing fame, and six-factor test for determining the existence of “dilution by blurring.” After applying these standards, the court found the result was the same as under the old standards: a reasonable trier of fact could conclude that Jada Toys’ HOT RIGZ mark, used in connection with toy trucks, was likely to dilute Mattel’s famous HOT WHEELS mark used in connection with toy vehicles.

The court’s Aug. 2, 2007, decision applied the old “actual dilution” standard because the case was filed before the TDRA became effective. The court explained in a footnote: “Because this action was filed in 2004, prior to the 2006 amendment of § 1125, … the previous version of § 1125 applies, codified at 15 U.S.C. § 1125(c)(1) (2000).” (STL post here.)

The amended decision replaces that footnote with an explanation as to why the “likelihood of dilution” and other standards established in the TDRA apply instead:

“We note that in this case the district court applied the prior version of the Federal Trademark Dilution Act (‘FTDA’), … which required a showing of actual dilution. The actual dilution requirement was a product of the Supreme Court’s decision in Moseley v. V Secret Catalogue, Inc., 537 U.S. 418, 433 (2003), where the Court held that the federal dilution statute required a showing of actual dilution. However, since that time the FTDA has been amended so as to require only a likelihood of dilution to succeed. In this case, we chose to apply the standard currently in operation so as to adhere to our prior precedent established in Nissan Motor Co. v. Nissan Computer Corp., 378 F.3d 1002, 1009-10 (9th Cir. 2004), in which we held that application of the FTDA to an alleged diluting mark that was in use before the statute’s passage was not retroactive because the FTDA authorizes only prospective relief.”

The court recognized that applying TDRA standards to a case that had been filed before the TDRA was enacted was inconsistent with its decision last year in Horphag Research Ltd. v. Garcia:

“We are aware that in Horphag Research Ltd. v. Garcia, 475 F.3d 1029, 1035 (9th Cir. 2007) (STL post here), we applied the FTDA retroactively, thereby creating an unintentional intra-circuit conflict with Nissan. In Horphag, however, neither party mentioned the TDRA in its briefs, nor moved for a petition for panel rehearing or to vacate the mandate in light of the TDRA’s passage. Moreover, the plaintiff in Horphag prevailed under the more stringent version of the federal dilution statute. Accordingly, recalling the Horphag mandate at this point would serve no purpose.”

It will be interesting to see whether the court’s amended decision will affect Phase Forward Inc. v. Adams, 2008 WL 340951 (N.D. Cal.) (STL post here), which granted plaintiff’s motion for reconsideration earlier this month based on the now-superseded Jada Toys decision that applied the FTDA’s standard for fame (which recognized niche market fame) rather than the TDRA’s standard (which requires nationwide fame). My guess is the Northern District of California will recognize this decision as yet another intervening change in controlling law and will restore its previous dismissal of plaintiff’s dilution claim.

The case cite is Jada Toys, Inc. v. Mattel, Inc., __ F.3d __, 2008 WL 450891, No. 05-55627 (9th Cir. Aug. 2, 2007, amended Feb. 21, 2008).

Let me finish a post I’ve been wanting to write for a few days now. With the Northern District of California’s understandable decision this week in Phase Forward Inc. v. Adams (STL post here) to follow its appellate court’s lead in Jada Toys, Inc. v. Mattel, Inc. (STL post here), I can’t help but face the fact that we have another split in the circuits over trademark dilution — the very thing the Trademark Dilution Revision Act was supposed to avoid.

On the one hand, we have courts in the Second and Fourth Circuits applying a schizophrenic test to determine whether the old standards under the Federal Trademark Dilution Act, or the new standards under the Trademark Dilution Revision Act, apply to cases that were pending on October 6, 2006, the date the TDRA was enacted. (See posts here and here.) This matters a lot because the old standards allowed for niche-market fame (in some jurisdictions) but required actual dilution, whereas the new standards require nationwide fame but lower the level of proof to a likelihood of dilution. Courts in the Second and Fourth Circuits appear to apply the TDRA retroactively (meaning the new standard applies) for injunctive relief, but prospectively (meaning the old standard applies) to claims for monetary relief. This poses a practical problem, since almost all dilution plaintiffs seek both types of relief.

That said, courts in the Ninth Circuit apply a completely different test. As Phase Forward recently demonstrated, Ninth Circuit courts appear to ignore the retroactive-prospective approach and instead focus on when the case was filed. Ninth Circuit courts appear to decide cases filed before October 6, 2006, under the old standards and cases filed after that date under the new standards. The cutoff date may be arbitrary, but at least it provides litigants with a bright-line rule.

Fortunately, the circuits’ split should be short lived. Within the next year or so, the remaining cases filed before the TDRA was enacted will settle, be dismissed, or be decided on their merits. Thereafter, there should be little question that the TDRA’s “new” standards will apply.

Until then, dilution jurisprudence remains a confusing mess.

In Phase Forward Inc. v. Adams, plaintiff brought suit in 2005 against defendant Mary Noel Adams stemming from defendant’s use of the trademark PHASE FORWARD.

After the Trademark Dilution Revision Act was enacted in October 2006, defendant moved for summary judgment on the ground that plaintiff’s mark did not meet the amended definition of a “famous mark” as one “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.” In filing its dilution claim, plaintiff had relied on the Ninth Circuit’s previous recognition of niche-market fame as a valid form of dilution.

At the time of defedant’s motion, the Ninth Circuit had not addressed the issue of whether the TDRA would be applied retroactively, though the Second Circuit in Starbucks Corp. v. Wolfe’s Borough Coffee, Inc., 477 F.3d 765, 766 (2d Cir. 2007) (STL post here), had applied the TDRA retroactively. Based on that decision, plaintiff voluntarily withdrew its dilution claim.

Nine days after the court issued its order dismissing the claim, the Ninth Circuit decided Jada Toys v. Mattel, Inc., 496 F.3d 974 (9th Cir. 2007) (STL post here), in which the court reversed the district court’s grant of summary judgment on Mattel’s counterclaim for federal trademark dilution. The Ninth Circuit noted that because the action was filed before the 2006 amendment, the pre-TDRA version of 15 U.S.C. § 1125(c) applied to Mattel’s dilution claim. Similarly, plaintiff’s claim for federal trademark dilution under Section 1125(c) was filed before the enactment of the TDRA. Therefore, plaintiff moved the court to reconsider and vacate its order granting summary judgment and reinstate its dilution claim.

On Feb. 5, Judge Jeremy Fogel found that the Ninth Circuit’s decision in Jada Toys constituted an intervening change in controlling law, and granted plaintiff’s motion without prejudice to defendant’s right to seek summary judgment on another claim in the future.

This whole prospective vs. retroactive application of TRDA is confusing. I don’t think it should be. Is it too simplistic to think that decisions before October 6, 2006 — the date TDRA was enacted — should be based on the old standard, and decisions after that date should be based on the new?

And why do some courts focus on the date the lawsuit was filed? The TDRA states: “In an action brought under this subsection, the owner of a famous mark shall be entitled to injunctive relief as set forth in section 1116 of this title. The owner of the famous mark shall also be entitled to the remedies set forth in sections 1117(a) [providing for damages] … [if] the mark or trade name that is likely to cause dilution by blurring or dilution by tarnishment was first used in commerce by the person against whom the injunction is sought after October 6, 2006….” Based on this language, shouldn’t courts focus on when the mark was first used, not when the case was filed?

The case cite is Phase Forward Inc. v. Adams, 2008 WL 340951, No. 05-4232 (N.D. Cal. Feb. 5, 2008) (Fogel, J.).

The Wall Street Journal’s Law Blog reports on New Yorker Jennifer Cassetta’s fight with Home Box Office, Inc., over her 2006 application to register HEALTH AND THE CITY in connection with “physical fitness instruction.” (Law Blog’s first post on the story here.) HBO, owner of its “Sex and the City” television program and SEX AND THE CITY family of marks, had extended the time to oppose Ms. Cassetta’s application since June. However, its last extension lapsed on Nov. 18, clearing the way for Ms. Cassetta to get her registration.

Most of the reader comments applauded Ms. Cassetta’s triumph over the “suits” at HBO and its parent, Time Warner Inc. However, two thought Ms. Cassetta had brought the trouble on herself by selecting a trademark that trades off HBO’s. I’ve got to side with the latter view. Out of the infinite universe of possible trademarks, she had to pick one that brought to mind HBO’s famous mark? Sure sounds like dilution by blurring to me.