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A trademark must be deemed “famous” before its owner can take advantage of the protections afforded by the Federal Trademark Dilution Act. Fame, it turns out, is not so easy to define. In theory, the amount of fame required depends on an analysis of eight factors articulated in the law. In practice, however, some courts have adopted a “niche” theory that allows a trademark owner to prove a mark’s fame by showing that it is well-known in a certain market or geographic region. A major drawback of this approach is that in defining the relevant market or geographic area, courts will often consider whether the trademark owner and the alleged infringer compete in the same market and whether they cater to a similar customer base. By introducing the idea of competition into the dilution analysis, courts have entangled the theory of dilution with traditional trademark infringement analysis. Dilution is an extraordinary remedy that affords trademark protection even where there is no likelihood of confusion between similar marks. Congress intended the act to prevent the introduction of products like DuPont shoes, Buick aspirin, and Kodak pianos — examples cited in the legislation — because of how well known these marks were, albeit for different products. Courts interpreting the act have suggested that these marks were used as examples because they enjoyed extremely broad consumer recognition across demographic and geographic constituents. Still, under niche theory, a trademark without broad consumer recognition can be considered famous if it is well-known within a particular market or geographic region. Circuits are currently split as to whether a niche theory should apply. The 3rd, 5th, 7th, and 9th circuits have embraced the theory, while the 1st and 2nd circuits have rejected it. For example, in Times Mirror Magazines, Inc. v. Las Vegas Sports News, the 3rd Circuit upheld a district court’s preliminary injunction, preventing the use of the trademarked term “sporting news” because it was famous within a niche market. In her dissent of the ruling, federal judge Maryanne Barry pointed out that fame was only supposed to apply to big brands (Buick, Kodak), writing that “if marks can be famous within some market, depending on how narrowly that market is defined, then the [Dilution Act] will surely devour infringement law.” Niche theory’s emphasis on competition is inconsistent with the spirit of dilution, which Congress defined as the lessening of the capacity of a mark to identify a class of goods regardless of competition between parties. Courts are either explicitly or implicitly introducing competition into the equation when they define fame by the degree of recognition among the same consumer base. Indeed, several courts have noted that a dilution cause of action might have existed if the opposing parties goods were more similar. In Ringling Bros. Barnum & Bailey Combined Shows v. B.E. Windows Corp., for example, a federal district court in New York noted that Ringling Bros. would have been able to protect its mark against dilution had Windows Corp. used its mark in connection with a circus-related motif. Similar reasoning was given in the case of Thane International v. Trek Bicycle Corp., in which the 9th Circuit noted that Trek might have been able to protect its mark had Thane used it in connection with mobile bicycles instead of stationary exercise equipment. Some scholars have argued that these cases go too far. In “McCarthy on Trademarks and Unfair Competition,” McCarthy says, “Recognition of niche fame is an improper application of the federal act, is an unnecessary and superfluous legal theory, and improperly displaces the traditional balance of competitive rights reflected in the likelihood of confusion test.” Some courts have agreed, noting that at least as applied between competitors selling related goods with identical or substantially similar marks, a dilution cause of action would be superfluous since an adequate remedy is available through an infringement claim. In jurisdictions where niche theory has been rejected, such as the 1st and 2nd circuits, the distorting effects of competition on dilution have taken a backseat to a more fundamental flaw — applying niche theory undermines the general purpose of protecting marks like DuPont, Buick, and Kodak, whose notoriety is not demographically or geographically limited. In rejecting application of the niche theory, these courts have wisely held that a mark’s fame must extend beyond a limited demographic or region to a broader cross section of the general consuming public in a substantial portion of the country. The application of niche theory makes little sense. Dilution was intended to protect only the most famous marks — without regard to competition. Courts are better off without its distorting effects, and trademark owners are better off knowing that dilution protection will not depend on an arbitrary circumstance like whether their goods are in direct competition with the alleged infringer’s. No one should be walking in DuPont shoes, taking Buick aspirin, or playing Kodak pianos, period. William Molinski is a partner in the Los Angeles office of Orrick, Herrington & Sutcliffe. Michael Moore is vice president-litigation for Metro-Goldwyn-Mayer Inc. Frank Rorie, an associate in Orrick’s L.A. office, assisted in the preparation of this article.

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