Shameless Self-Promotion: Updating the Lanham Act for the Internet Age

I have an article in the newest issue of World Trademark Review.  Entitled "Updating the Lanham Act for the Internet Age," the article looks at four areas for reform of the Lanham Act: fair use, use in commerce, adoption of statutory safe harbors, and the famous marks doctrine.

Below is an excerpt.  You can read the full article here.

The rise of the Internet has facilitated an increasingly interconnected world, allowing for the widespread dissemination of information, and giving unprecedented access to the ideas and experiences of people across the globe -- as when a student in New York can follow in real time the dispatches of a demonstrator in Tehran. In the years since the introduction of Netscape Navigator, a host of third-party intermediaries have arisen to facilitate, catalog and archive this explosion of information on the Internet, including the likes of Blogger, its parent company Google, Twitter, and the Internet Archive.

As others have documented, the cross-border exchange of knowledge, goods, and services made possible by the Internet has exposed some of the limitations of national laws crafted during a time when most communication and commerce was local in nature. (For more on this, see many of the essays in Borders in Cyberspace, Brian Kahin and Charles Nesson eds. (1997).) This is especially true with respect to intellectual property rights, which have come under increasing pressure from online activities. In 1998 the US Congress attempted to address some of these issues by passing the Digital Millennium Copyright Act ("DMCA") (17 U.S.C. § 1201 et seq.). Coming at the start of the so-called "dot com bubble," the DMCA included provisions intended to encourage the growth of new ventures by granting internet service providers a safe harbor from copyright liability for hosting third-party content (17 U.S.C. § 512). (Congress had previously provided a similar safe haven for non-intellectual property claims in Section 230 of the Communications Decency Act.) The following year, Congress attempted to address some of the challenges posed by the Internet to the trademark laws, passing the Anti-cybersquatting Consumer Protection Act (15 USC § 1125(d)).

However, several challenges remain and are currently being tackled on an ad hoc basis by the courts as each new conflict arises. The time has come for Congress to deal with these issues by updating the Lanham Act to balance the interests of trademark holders with the public benefits of encouraging a robust discourse and the dissemination of information online.

The Challenge Posed by the Internet

US trademark law initially grew out of state unfair competition laws, remaining a primarily common law doctrine until the passage of a federal trademark statute in 1905. (An earlier federal trademark statute was struck down by the US Supreme Court in 1897. The Trademark Cases, 100 U.S. 82, 96, 25 L. Ed. 550 (1879)). As befitting a country that saw fit to enshrine local control over local affairs in its founding document (Amendment X of the US Constitution), trademark law in the United States has remained a highly localized affair. The various states retain their own statutory and common law actions for trademark infringement (although the courts have largely interpreted state laws to track federal trademark law, even in the face of differences in the statutory language) and each of the federal circuits has been allowed to develop its own case law to govern trademark disputes arising within its borders. Only occasionally, if the distance between the circuits grows too wide, will the US Supreme Court step in to settle the matter definitively, as it did in cases such as TrafFix Devices Inc. v Marketing Displays Inc., 523 U.S. 23 (2001) and K-P Permanent Make-Up Inc. v Lasting Impressions Inc., 543 U.S. 111(2004).

This system has always left room for large national companies to be subjected to conflicting legal dictates resulting from differing statutory interpretations among the circuits. The expansion of the Internet has served both to multiply and magnify these conflicts, as more actors engage in activities online that cross state (and national) borders. With the expansion of the doctrine of personal jurisdiction to allow states to assert control over the actions of an out-of-state company or individual based on the maintenance of an interactive website, an increasing number of entities are subject to the jurisdiction of multiple courts.  See Zippo Mfg. Co. v Zippo Dot Com Inc., 952 F. Supp. 1119 (W.D. Pa. 1997).

In recent years a number of circuit splits have opened up in the trademark laws. The expansion of the Internet has helped to create and intensify such splits of authority with regards to three trademark doctrines in particular:

  • fair use;
  • the meaning of "use in commerce"; and
  • the famous marks doctrine.

Fair use

Unlike the Copyright Act, which contains a statutory codification of fair use doctrines initially developed at common law by the courts, the trademark infringement provisions of the Lanham Act currently lack any comprehensive discussion of fair use principles. Instead, the Lanham Act contains a single provision, in Section 33(b)(4), which makes the use of a term descriptively an affirmative defense to a claim for trademark infringement. 15 USC § 1115(b)(4).  In contrast, the Federal Trademark Dilution Act, implemented in 1995 to provide protection from dilution for famous marks, identifies several "fair use" defenses:

  • truthful comparative advertising;
  • non-commercial use of a mark; and
  • news reporting and commentary.

In the absence of a clear statutory definition of "fair use," the courts have developed several different doctrines that provide fair use-like defenses to a defendant in a trademark infringement case. Professor William McGeveran has categorized these various doctrinal strains into four main categories:

  • the "trademark use" theory;
  • nominative fair use;
  • descriptive or "classic" fair use under Section 33(b)(4); and
  • First Amendment-inspired defenses.

See William McGeveran, "Four Free Speech Goals for Trademark Law," 18 Fordham Intell. Prop. Media & Ent. L.J. 1205, 1215-1216 (2008). In practice, however, these doctrines often overlap and there is significant disagreement among the courts as to how or whether a doctrine should be applied in a given case. In particular, the nominative fair use and First Amendment defenses are the subject of circuit splits.

One of the oft-cited trademark fair use doctrines is the so-called "nominative fair use" defense, which insulates from liability certain uses of trademarks to refer to the rights holder's product or to engage in comparative advertising. The doctrine was first enunciated by the Ninth Circuit in New Kids on the Block v News Am. Publ'g Inc., 971 F.2d 302 (9th Cir 1992). As articulated by the Ninth Circuit, the nominative fair use test contains three prongs:

  • the product or service at issue must be one that is not readily identifiable without use of the trademark;
  • the user must use only so much of the trademark as is reasonably necessary to identify the product; and
  • the user must not do anything that would suggest sponsorship or endorsement by the trademark owner.

The nominative fair use doctrine has not been uniformly adopted by the remaining circuit courts. The Sixth Circuit has expressly declined to adopt a nominative fair use defense. PACCAR Inc. v Telescan Techs LLC, 391 F.3d 243, 256 (6th Cir. 2003) (overruled in part on other grounds). The Fifth Circuit has adopted the doctrine, but has rejected the first prong of the Ninth Circuit's New Kids on the Block test. Pebble Beach Co. v Tour 18 I Ltd., 155 F.3d 526, 546 n 13 (5th Cir. 1998) (overruled in part on other grounds)). Even those courts that have largely adopted the Ninth Circuit's test differ as to how the doctrine is applied. The Ninth Circuit considers the nominative fair use analysis to be a threshold question, declining to consider the likelihood of confusion factors once nominative fair use is found Cairns v Franklin Mint Co., 292 F.3d 1139, 1150 (9th Cir. 2002). In contrast, the Third Circuit, which has adopted a slightly modified version of the test, has held that nominative fair use is an affirmative defense which should be considered only once the plaintiff has met its burden to establish a likelihood of confusion Century 21 Real Estate Corp. v Lendingtree Inc., 425 F.3d 211, 231-32 (3d Cir. 2005).

There is similar confusion among the circuits as to how First Amendment concerns should be addressed in a trademark infringement case. The tension between the Lanham Act's protection against consumer confusion and the public's interest in free expression was clearly articulated by the Second Circuit in Rogers v Grimaldi, 875 F.2d 994, 999 (2d Cir. 1989). The Second Circuit found that "the [Lanham] Act should be construed to apply to artistic works only where the public interest in avoiding consumer confusion outweighs the public interest in free expression," noting that the interest in free expression would generally outweigh concerns about trademark infringement so long as the use of a mark bore some artistic relevance to the work at issue. Applying this analysis, the Second Circuit allowed the use of Ginger Rogers's name in the title of the movie Ginger and Fred, despite the fact that Rogers was not the subject of the film. In contrast, the Ninth Circuit upheld an injunction against publication of the book The Cat NOT in the Hat despite the defendant's assertion of a First Amendment fair use defense, finding the use of a trademark as part of a parody to be protected only if the parody directly comments on the trademarked work. Dr. Seuss Enterprises LP v Penguin Books USA Inc., 109 F.3d 1394, 1403 (9th Cir. 1997).

The end result of the uncertainty generated by this lack of harmonization among the circuits is increased transactional costs and uncertainty for works that make use of third-party trademarks -- what McGeveran calls the "Clearance Culture." In the internet context, conflicting prescriptions on what is allowable become possible. Thus, the legality of a particular trademark use could depend upon the jurisdiction in which the trademark owner is located or can exercise personal jurisdiction over the author, potentially necessitating an in-depth review of the precedents of multiple circuits prior to posting any content.


Changing technology poses a number of challenges for US trademark law. The expanding popularity of the Internet increases the societal costs that result from inconsistently applied trademark doctrines, threatening the vibrancy of online speech should circuit conflicts result in plaintiff forum shopping for the most restrictive policies. By updating the Lanham Act to address these challenges, Congress could mitigate many of these costs and encourage the continued development of new and improved internet services.

To read the full article, click here

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