[House Report 109-23]
[From the U.S. Government Publishing Office]



109th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 1st Session                                                     109-23
======================================================================

 
                TRADEMARK DILUTION REVISION ACT OF 2005

                                _______
                                

 March 17, 2005.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

 Mr. Sensenbrenner, from the Committee on the Judiciary, submitted the 
                               following

                              R E P O R T

                        [To accompany H.R. 683]

      [Including cost estimate of the Congressional Budget Office]

  The Committee on the Judiciary, to whom was referred the bill 
(H.R. 683) to amend the Trademark Act of 1946 with respect to 
dilution by blurring or tarnishment, having considered the 
same, report favorably thereon with an amendment and recommend 
that the bill as amended do pass.

                                CONTENTS

                                                                   Page
The Amendment....................................................     1
Purpose and Summary..............................................     3
Background and Need for the Legislation..........................     4
Hearings.........................................................     6
Committee Consideration..........................................     6
Vote of the Committee............................................     6
Committee Oversight Findings.....................................     6
New Budget Authority and Tax Expenditures........................     6
Congressional Budget Office Cost Estimate........................     6
Performance Goals and Objectives.................................     7
Constitutional Authority Statement...............................     7
Section-by-Section Analysis and Discussion.......................     7
Changes in Existing Law Made by the Bill, as Reported............     9
Markup Transcript................................................    14

                             The Amendment

  The amendment is as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

    (a) Short Title.--This Act may be cited as the ``Trademark Dilution 
Revision Act of 2005''.
    (b) References.--Any reference in this Act to the Trademark Act of 
1946 shall be a reference to the Act entitled ``An Act to provide for 
the registration and protection of trademarks used in commerce, to 
carry out the provisions of certain international conventions, and for 
other purposes'', approved July 5, 1946 (15 U.S.C. 1051 et seq.).

SEC. 2. DILUTION BY BLURRING; DILUTION BY TARNISHMENT.

    Section 43 of the Trademark Act of 1946 (15 U.S.C. 1125) is 
amended--
            (1) by striking subsection (c) and inserting the following:
    ``(c) Dilution by Blurring; Dilution by Tarnishment.--
            ``(1) Injunctive relief.--Subject to the principles of 
        equity, the owner of a famous mark that is distinctive, 
        inherently or through acquired distinctiveness, shall be 
        entitled to an injunction against another person who, at any 
        time after the owner's mark has become famous, commences use of 
        a mark or trade name in commerce that is likely to cause 
        dilution by blurring or dilution by tarnishment of the famous 
        mark, regardless of the presence or absence of actual or likely 
        confusion, of competition, or of actual economic injury.
            ``(2) Definitions.--(A) For purposes of paragraph (1), 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. In 
        determining whether a mark possesses the requisite degree of 
        recognition, the court may consider all relevant factors, 
        including the following:
                    ``(i) The duration, extent, and geographic reach of 
                advertising and publicity of the mark, whether 
                advertised or publicized by the owner or third parties.
                    ``(ii) The amount, volume, and geographic extent of 
                sales of goods or services offered under the mark.
                    ``(iii) The extent of actual recognition of the 
                mark.
            ``(B) For purposes of paragraph (1), `dilution by blurring' 
        is association arising from the similarity between a mark or 
        trade name and a famous mark that impairs the distinctiveness 
        of the famous mark. In determining whether a mark or trade name 
        is likely to cause dilution by blurring, the court may consider 
        all relevant factors, including the following:
                    ``(i) The degree of similarity between the mark or 
                trade name and the famous mark.
                    ``(ii) The degree of inherent or acquired 
                distinctiveness of the famous mark.
                    ``(iii) The extent to which the owner of the famous 
                mark is engaging in substantially exclusive use of the 
                mark.
                    ``(iv) The degree of recognition of the famous 
                mark.
                    ``(v) Whether the user of the mark or trade name 
                intended to create an association with the famous mark.
                    ``(vi) Any actual association between the mark or 
                trade name and the famous mark.
            ``(C) For purposes of paragraph (1), `dilution by 
        tarnishment' is association arising from the similarity between 
        a mark or trade name and a famous mark that harms the 
        reputation of the famous mark.
            ``(3) Exclusions.--The following shall not be actionable as 
        dilution by blurring or dilution by tarnishment under this 
        subsection:
                    ``(A) Fair use of a famous mark by another person 
                in comparative commercial advertising or promotion to 
                identify the competing goods or services of the owner 
                of the famous mark.
                    ``(B) Fair use of a famous mark by another person, 
                other than as a designation of source for the person's 
                goods or services, including for purposes of 
                identifying and parodying, criticizing, or commenting 
                upon the famous mark owner or the goods or services of 
                the famous mark owner.
                    ``(C) All forms of news reporting and news 
                commentary.
            ``(4) Additional remedies.--In an action brought under this 
        subsection, the owner of the famous mark shall be entitled only 
        to injunctive relief as set forth in section 34, except that, 
        if--
                    ``(A) the person against whom the injunction is 
                sought did not use in commerce, prior to the date of 
                the enactment of the Trademark Dilution Revision Act of 
                2005, the mark or trade name that is likely to cause 
                dilution by blurring or dilution by tarnishment, and
                    ``(B) in a claim arising under this subsection--
                            ``(i) by reason of dilution by blurring, 
                        the person against whom the injunction is 
                        sought willfully intended to trade on the 
                        recognition of the famous mark, or
                            ``(ii) by reason of dilution by 
                        tarnishment, the person against whom the 
                        injunction is sought willfully intended to harm 
                        the reputation of the famous mark,
        the owner of the famous mark shall also be entitled to the 
        remedies set forth in sections 35(a) and 36, subject to the 
        discretion of the court and the principles of equity.
            ``(5) Ownership of valid registration a complete bar to 
        action.--The ownership by a person of a valid registration 
        under the Act of March 3, 1881, or the Act of February 20, 
        1905, or on the principal register under this Act shall be a 
        complete bar to an action against that person, with respect to 
        that mark, that is brought by another person under the common 
        law or a statute of a State and that seeks to prevent dilution 
        by blurring or dilution by tarnishment, or that asserts any 
        claim of actual or likely damage or harm to the distinctiveness 
        or reputation of a mark, label, or form of advertisement.''; 
        and
            (2) in subsection (d)(1)(B)(i)(IX), by striking ``(c)(1) of 
        section 43'' and inserting ``(c)''.

SEC. 3. CONFORMING AMENDMENTS.

    (a) Marks Registrable on the Principal Register.--Section 2(f) of 
the Trademark Act of 1946 (15 U.S.C. 1052(f)) is amended--
            (1) by striking the last two sentences; and
            (2) by adding at the end the following: ``A mark which 
        would be likely to cause dilution by blurring or dilution by 
        tarnishment under section 43(c), may be refused registration 
        only pursuant to a proceeding brought under section 13. A 
        registration for a mark which would be likely to cause dilution 
        by blurring or dilution by tarnishment under section 43(c), may 
        be canceled pursuant to a proceeding brought under either 
        section 14 or section 24.''
    (b) Opposition.--Section 13(a) of the Trademark Act of 1946 (15 
U.S.C. 1063(a)) is amended in the first sentence by striking ``as a 
result of dilution'' and inserting ``the registration of any mark which 
would be likely to cause dilution by blurring or dilution by 
tarnishment''.
    (c) Cancellation.--Section 14 of the Trademark Act of 1946 (15 
U.S.C. 1064) is amended, in the matter preceding paragraph (1)--
            (1) by striking ``, including as a result of dilution under 
        section 43(c),''; and
            (2) by inserting ``(A) for which the constructive use date 
        is after the date on which the petitioner's mark became famous 
        and which would be likely to cause dilution by blurring or 
        dilution by tarnishment under section 43(c), or (B) on grounds 
        other than dilution by blurring or dilution by tarnishment'' 
        after ``February 20, 1905''.
    (d) Marks for the Supplemental Register.--The second sentence of 
section 24 of the Trademark Act of 1946 (15 U.S.C. 1092) is amended to 
read as follows: ``Whenever any person believes that such person is or 
will be damaged by the registration of a mark on the supplemental 
register--
            ``(1) for which the effective filing date is after the date 
        on which such person's mark became famous and which would be 
        likely to cause dilution by blurring or dilution by tarnishment 
        under section 43(c), or
            ``(2) on grounds other than dilution by blurring or 
        dilution by tarnishment,
such person may at any time, upon payment of the prescribed fee and the 
filing of a petition stating the ground therefor, apply to the Director 
to cancel such registration.''.
    (e) Definitions.--Section 45 of the Trademark Act of 1946 (15 
U.S.C. 1127) is amended by striking the definition relating to 
``dilution''.

                          Purpose and Summary

    The purpose of H.R. 683, the ``Trademark Dilution Revision 
Act of 2005,'' is to amend the Federal Trademark Dilution Act 
\1\ (FTDA) in the wake of a recent Supreme Court decision 
regarding the standard of harm under the statute and 
conflicting circuit case law on other relevant issues.
---------------------------------------------------------------------------
    \1\ Pub. L. No. 104-98 (1995).
---------------------------------------------------------------------------

                Background and Need for the Legislation

                        TRADEMARK LAW GENERALLY

    Trademark law ``identifies'' goods and services.\2\ When an 
individual encounters a mark (e.g., a word or symbol) in a 
store or watching a commercial, he or she can develop an 
association between a product or service and its corresponding 
quality, brand reputation, or origin. Generally, a trademark 
consists of the name or logo of a product. For example, the 
restaurant chain McDonald's has trademarks in its name, its 
golden arches logo, and other marks associated with its 
business. In addition, trademark law also may protect the 
distinctive features of a product's packaging. Examples of 
famous and distinctive packaging include the shape of Coca-
Cola's bottle or Tiffany's little blue jewelry box.
---------------------------------------------------------------------------
    \2\ The proper term for a mark identifying a service (e.g., 
``FedEx'' or ``AOL'') is a ``service mark.'' Throughout this document, 
it must be assumed that the term ``trademark,'' which strictly speaking 
refers to a product, also is meant to include references to service 
marks.
---------------------------------------------------------------------------

       DILUTION GENERALLY AND THE FEDERAL TRADEMARK DILUTION ACT

    Trademark rights are unique because they are based on 
Federal as well as state law. In fact, many states offer 
trademark protection against ``dilution.'' Dilution is defined 
as ``the lessening of the capacity of a famous mark to identify 
and distinguish goods or services regardless of the presence or 
absence of: (a) competition between the owner of the famous 
mark and other parties; or (b) the likelihood of confusion, 
mistake, or deception.\3\ Courts have defined dilution as 
either the blurring of a mark's product identification or the 
tarnishment of the affirmative associations a mark has come to 
convey.
---------------------------------------------------------------------------
    \3\ 15 U.S.C. 1127 (1998).
---------------------------------------------------------------------------
    Dilution does not rely upon the standard test of 
infringement, that is, the likelihood of confusion, deception, 
or mistake. Rather, dilution occurs when the unauthorized use 
of a famous mark reduces the public's perception that the mark 
signifies something unique, singular, or particular.\4\ In 
other words, dilution can result in the loss of the mark's 
distinctiveness and, in worst-case scenarios, the owner's 
rights in it.
---------------------------------------------------------------------------
    \4\ H.R. Rep. No. 104-364 (1995) reprinted in U.S.C.C.A.N. at 1029, 
1030.
---------------------------------------------------------------------------
    In order to promote uniformity and certainty for trademark 
owners, a Federal dilution statute was enacted in 1995.\5\ The 
purpose of the FTDA is to protect famous trademarks, whether 
registered or unregistered, from subsequent uses that blur the 
distinctiveness of the mark or tarnish or disparage it, even in 
the absence of a likelihood of confusion. The FTDA applies when 
unauthorized users attempt to trade upon the goodwill and 
established renown of such marks, and thereby dilute their 
distinctive quality.\6\
---------------------------------------------------------------------------
    \5\ See supra note 1.
    \6\ H.R. Rep. No. 104-364 (1995) reprinted in U.S.C.C.A.N. at 1029. 
See also Lori Krafte-Jacobs, Judicial Interpretation of the Federal 
Trademark Dilution Act of 1995, 66 U. Cin. L. Rev. 659 (1998).
---------------------------------------------------------------------------
    The FTDA specifies the following factors that a court may 
consider, but is not limited to, in determining whether a mark 
is distinctive and famous:

         Lthe degree of inherent or acquired 
        distinctiveness of the mark;

         Lthe duration and extent of use of the mark in 
        connection with the goods or services with which the 
        mark is used;

         Lthe duration and extent of advertising and 
        publicity of the mark;

         Lthe geographical extent of the trading area 
        in which the mark is used;

         Lthe channels of trade for the goods or 
        services with which the mark is used;

         Lthe degree of recognition of the mark in the 
        trading areas and channels of trade used by the marks' 
        owner and the person against whom the injunction is 
        sought; and

         Lthe nature and extent of use of the same or 
        similar marks by third parties.\7\
---------------------------------------------------------------------------
    \7\ 15 U.S.C. Sec. 1125(c).
---------------------------------------------------------------------------

                   MOSELY V. V SECRET CATALOGUE, INC.

    Following passage of the FTDA, the circuit courts of appeal 
split as to whether the statute required the owner of a famous 
mark to prove actual harm as a prerequisite to injunctive 
relief. This question was addressed by the Supreme Court in the 
case of Mosely v. V Secret Catalogue, Inc.\8\ In a dilution 
action between the lingerie company Victoria's Secret and a 
small retail company (Victor's Little Secret) that sold, among 
other items, adult ``novelties,'' the Court determined that the 
FTDA ``. . . unambiguously requires a showing of actual 
dilution, rather than a likelihood of dilution.'' \9\
---------------------------------------------------------------------------
    \8\ 123 S. Ct. 1115 (2003).
    \9\ 537 U.S. 418 (2003).
---------------------------------------------------------------------------
    The Subcommittee on Courts, the Internet, and Intellectual 
Property received testimony in 2004 \10\ and 2005 on this issue 
and other dilution topics. Witnesses at these hearings focused 
on the standard of harm threshold articulated in Mosely. For 
example, a representative of the International Trademark 
Association observed that ``[b]y the time measurable, provable 
damage to the mark has occurred much time has passed, the 
damage has been done, and the remedy, which is injunctive 
relief, is far less effective.'' \11\ The Committee endorses 
this position. The Mosely standard creates an undue burden for 
trademark holders who contest diluting uses and should be 
revised.
---------------------------------------------------------------------------
    \10\ Hearings on a Committee Print to Amend the Federal Trademark 
Dilution Act, 108th Cong., 2d Sess., Serial No. 72 (April 22, 2004).
    \11\ Hearings on the Trademark Dilution Revision Act of 2005 Before 
the Subcomm. on Courts, the Internet, and Intellectual Property of the 
House Comm. on the Judiciary, 109th Cong., 1st Sess. (February 17, 
2005) (statement of Anne Gundelfinger on behalf of the International 
Trademark Association at 3) (hereinafter Gundelfinger).
---------------------------------------------------------------------------

                   OTHER ISSUES ADDRESSED BY H.R. 683

    In addition, the circuits have split on the meaning and 
application of other core provisions of the statute. This 
absence of uniformity concerns the Committee, as it complicates 
the ability of mark holders to protect their property and 
businesses to plan their commercial affairs.
    Hearings revealed that the regional circuits interpret the 
FTDA differently on such matters as what constitutes a 
``famous'' mark, whether marks with ``acquired 
distinctiveness'' are protected under the statute, and whether 
the FTDA covers dilution by ``tarnishment.'' \12\ The resulting 
problems were concisely summarized at the Subcommittee's 2005 
hearing as follows:
---------------------------------------------------------------------------
    \12\ Id. at 3-4. See also statement of William G. Barber on behalf 
of the American Intellectual Property Law Association at 2-3.

        [D]ilution law in the United States is moving in every 
        direction except the one that it needs to--forward. . . 
        . All the while, famous marks and their value both to 
        consumers and their owners remain at risk from blurring 
        and tarnishment, and third parties have little guidance 
        regarding what marks they can safely adopt without risk 
        of dilution liability. The lack of clarity in the law 
        and the splits in the various circuits are resulting in 
        forum shopping and unnecessarily costly lawsuits. For 
        these reasons a revision of dilution law is needed.\13\
---------------------------------------------------------------------------
    \13\ Gundelfinger at 5.

    The Committee subscribes to this view and H.R. 683 serves 
as a legislative response to these problems.

                                Hearings

    No hearings were held on H.R. 683.

                        Committee Consideration

    On March 3, 2005, the Subcommittee on Courts, the Internet, 
and Intellectual Property met in open session and ordered 
favorably reported the bill H.R. 683, as amended, by voice 
vote, a quorum being present. On March 9, 2005, the Committee 
met in open session and ordered favorably reported the bill 
H.R. 683 with an amendment by voice vote, a quorum being 
present.

                         Vote of the Committee

    In compliance with clause 3(b) of Rule XIII of the Rules of 
the House of Representatives, the Committee notes that there 
were no recorded votes during Committee consideration of H.R. 
683.

                      Committee Oversight Findings

    In compliance with clause 3(c)(1) of Rule XIII of the Rules 
of the House of Representatives, the Committee reports that the 
findings and recommendations of the Committee, based on 
oversight activities under clause 2(b)(1) of Rule X of the 
Rules of the House of Representatives, are incorporated in the 
descriptive portions of this report.

               New Budget Authority and Tax Expenditures

    Clause 3(c)(2) of Rule XIII of the Rules of the House of 
Representatives is inapplicable because this legislation does 
not provide new budgetary authority or increased tax 
expenditures.

               Congressional Budget Office Cost Estimate

    In compliance with clause 3(c)(3) of Rule XIII of the Rules 
of the House of Representatives, the Committee sets forth, with 
respect to the bill, H.R. 683, the following estimate and 
comparison prepared by the Director of the Congressional Budget 
Office under section 402 of the Congressional Budget Act of 
1974:

                                     U.S. Congress,
                               Congressional Budget Office,
                                    Washington, DC, March 14, 2005.
Hon. F. James Sensenbrenner, Jr., Chairman,
Committee on the Judiciary,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 683, the 
``Trademark Dilution Revision Act of 2005.''
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Melissa E. 
Zimmerman, who can be reached at 226-2860.
            Sincerely,
                                       Douglas Holtz-Eakin.

Enclosure

cc:
        Honorable John Conyers, Jr.
        Ranking Member
H.R. 683--Trademark Dilution Revision Act of 2005.
    H.R. 683 would make changes to trademark law to strengthen 
a trademark owner's defense against the use of other similar 
marks in the market that could harm the reputation of the 
trademark or confuse consumers. CBO estimates that implementing 
H.R. 683 would not have a significant effect on spending 
subject to appropriation. Enacting the bill would not affect 
direct spending or revenues.
    H.R. 683 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act and 
would impose no costs on State, local, or tribal governments.
    The CBO staff contact for this estimate is Melissa E. 
Zimmerman, who can be reached at 226-2860. The estimate was 
approved by Peter H. Fontaine, Deputy Assistant Director for 
Budget Analysis.

                    Performance Goals and Objectives

    H.R. 683 does not authorize funding. Therefore, clause 
3(c)(4) of Rule XIII of the Rules of the House of 
Representatives is inapplicable. H.R. 683 amends the Federal 
Trademark Dilution Act tp protect against the dilution of a 
protected trademark.

                   Constitutional Authority Statement

    Pursuant to Rule XI, clause 2(1)(4) of the Rules of the 
House of Representatives, the Committee finds the authority for 
this legislation in Article I, section 8, clause 8, of the 
Constitution.

               Section-by-Section Analysis and Discussion

    Section 1. Short Title. The Act may be cited as the 
``Trademark Dilution Revision Act of 2005.''
    Section 2. Dilution by Blurring; Dilution by Tarnishment. 
Subject to the principles of equity, the owner of a famous 
distinctive mark is entitled to an injunction against any 
person who commences use in commerce a mark that is likely to 
cause dilution by blurring or tarnishment.
    Section 2 of H.R. 683 specifies that injunctive relief is 
appropriate even if there is no:

         Lactual or likely confusion among the public;

         Lcompetition between the owner and the person; 
        or

         Lactual economic injury to the owner.

    Under Sec. 2, a mark may only be ``famous'' if it is widely 
recognized by the general consuming public in the United States 
as a source designation of the goods or services of the mark's 
owner. In determining whether a mark is famous, a court is 
permitted to consider ``all relevant factors'' in addition to 
prescribed conditions set forth in H.R. 683, including the 
duration, extent, and geographic reach of advertising and 
publicity of the mark.
    Again, a court is permitted to consider all relevant 
factors in determining the presence of dilution by blurring. 
Specific factors that provide guidance in this regard include:

         Lthe degree of similarity between the source 
        designation and the famous mark;

         Lthe degree of inherent or acquired 
        distinctiveness of the famous mark; and

         Lthe degree of recognition of the famous mark.

    Section 2 of H.R. 683 enumerates specific exclusions that 
do not constitute dilution: fair use in comparative commercial 
advertising or promotion to identify the famous mark owner's 
competing goods or services; fair use, other than as a 
designation of source, including for purposes of identifying 
and parodying, criticizing, or commenting upon the famous mark 
owner or the famous mark owner's goods or services; and all 
forms of news reporting and news commentary.
    The owner of a famous mark is only entitled to injunctive 
relief under Sec. 2, unless, in an action based on dilution by 
blurring, the defendant willfully intended to trade on the 
famous mark's recognition; or in an action based on dilution by 
tarnishment, the defendant willfully intended to trade on the 
famous mark's reputation. In either case, the owner may also 
seek damages, costs, and attorneys' fees \14\ as well as 
destruction of the infringing articles \15\ under separate 
Lanham Act provisions.
---------------------------------------------------------------------------
    \14\ 15 U.S.C. Sec. 1117(a).
    \15\ 15 U.S.C. Sec. 1118.
---------------------------------------------------------------------------
    Substantial portions of Sec. 2 are based on the existing 
FTDA, but there are conspicuous differences between the two 
texts. Under H.R. 683, and in response to the Mosely decision, 
actual harm is not a prerequisite to injunctive relief. H.R. 
683 also defines dilution by ``blurring'' as well as by 
``tarnishment.'' In addition, the legislation expands the 
threshold of ``fame'' and thereby denies protection for marks 
that are famous only in ``niche'' markets. Finally, Sec. 2 
would protect trade dress or product configuration and it would 
not preempt state remedies for dilution.
    Section 3. Conforming Amendments. Sections 2(f), 13(a), 14 
and 24 of the Lanham Act were amended by the Trademark 
Amendments Act of 1999 (Pub. L. No. 106-43) to grant owners of 
famous trademarks the right to oppose registration or seek 
cancellation of the registration of a mark on either the 
principal or supplemental registers on the grounds that such 
registration would cause dilution of the famous marks under the 
FTDA Act. The conforming amendments made to these sections 
would maintain the rights granted by the Trademark Amendments 
Act of 1999. The new language in the legislation merely updates 
these sections so that they comport with certain key changes 
made to section 43(c)--specifically that the standard for 
proving a dilution claim is ``likelihood of dilution'' and that 
both dilution by blurring and dilution by tarnishment are 
actionable.

         Changes in Existing Law Made by the Bill, as Reported

    In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italics, existing law in which no change 
is proposed is shown in roman):

                          ACT OF JULY 5, 1946

        (Commonly referred to as the ``Trademark Act of 1946''.)

  AN ACT To provide for the registration and protection of trademarks 
used in commerce, to carry out the provisions of certain international 
                  conventions, and for other purposes.

TITLE I--THE PRINCIPAL REGISTER

           *       *       *       *       *       *       *


              MARKS REGISTRABLE ON THE PRINCIPAL REGISTER

    Sec. 2. No trademark by which the goods of the applicant 
may be distinguished from the goods of others shall be refused 
registration on the principal register on account of its nature 
unless it--
    (a) * * *

           *       *       *       *       *       *       *

    (f) Except as expressly excluded in subsections (a), (b), 
(c), (d), (e)(3), and (e)(5) of this section, nothing herein 
shall prevent the registration of a mark used by the applicant 
which has become distinctive of the applicant's goods in 
commerce. The Director may accept as prima facie evidence that 
the mark has become distinctive, as used on or in connection 
with the applicant's goods in commerce, proof of substantially 
exclusive and continuous use thereof as a mark by the applicant 
in commerce for the five years before the date on which the 
claim of distinctiveness is made. Nothing in this section shall 
prevent the registration of a mark which, when used on or in 
connection with the goods of the applicant, is primarily 
geographically deceptively misdescriptive of them, and which 
became distinctive of the applicant's goods in commerce before 
the date of the enactment of the North American Free Trade 
Agreement Implementation Act.
[A mark which when used would cause dilution under section 
43(c) may be refused registration only pursuant to a proceeding 
brought under section 13. A registration for a mark which when 
used would cause dilution under section 43(c) may be canceled 
pursuant to a proceeding brought under either section 14 or 
section 24.] A mark which would be likely to cause dilution by 
blurring or dilution by tarnishment under section 43(c), may be 
refused registration only pursuant to a proceeding brought 
under section 13. A registration for a mark which would be 
likely to cause dilution by blurring or dilution by tarnishment 
under section 43(c), may be canceled pursuant to a proceeding 
brought under either section 14 or section 24.

           *       *       *       *       *       *       *


                               OPPOSITION

    Sec. 13. (a) Any person who believes that he would be 
damaged by the registration of a mark upon the principal 
register, including [as a result of dilution] the registration 
of any mark which would be likely to cause dilution by blurring 
or dilution by tarnishment under section 43(c), may, upon 
payment of the prescribed fee, file an opposition in the Patent 
and Trademark Office, stating the grounds therefor, within 
thirty days after the publication under subsection (a) of 
section 12 of this Act of the mark sought to be registered. 
Upon written request prior to the expiration of the thirty-day 
period, the time for filing opposition shall be extended for an 
additional thirty days, and further extensions of time for 
filing opposition may be granted by the Director for good cause 
when requested prior to the expiration of an extension. The 
Director shall notify the applicant of each extension of the 
time for filing opposition. An opposition may be amended under 
such conditions as may be prescribed by the Director.

           *       *       *       *       *       *       *

    Sec. 14. A petition to cancel a registration of a mark, 
stating the grounds relied upon, may, upon payment of the 
prescribed fee, be filed as follows by any person who believes 
that he is or will be damaged[, including as a result of 
dilution under section 43(c),] by the registration of a mark on 
the principal register established by this Act, or under the 
Act of March 3, 1881, or the Act of February 20, 1905 (A) for 
which the constructive use date is after the date on which the 
petitioner's mark became famous and which would be likely to 
cause dilution by blurring or dilution by tarnishment under 
section 43(c), or (B) on grounds other than dilution by 
blurring or dilution by tarnishment:
            (1) * * *

           *       *       *       *       *       *       *


TITLE II--THE SUPPLEMENTAL REGISTER

           *       *       *       *       *       *       *


                              CANCELATION

    Sec. 24. Marks for the supplemental register shall not be 
published for or be subject to opposition, but shall be 
published on registration in the Official Gazette of the Patent 
and Trademark Office. [Whenever any person believes that he is 
or will be damaged by the registration of a mark on this 
register, including as a result of dilution under section 
43(c), he may at any time, upon payment of the prescribed fee 
and the filing of a petition stating the ground therefor, apply 
to the Director to cancel such registration.] Whenever any 
person believes that such person is or will be damaged by the 
registration of a mark on the supplemental register--
            (1) for which the effective filing date is after 
        the date on which such person's mark became famous and 
        which would be likely to cause dilution by blurring or 
        dilution by tarnishment under section 43(c), or
            (2) on grounds other than dilution by blurring or 
        dilution by tarnishment,
such person may at any time, upon payment of the prescribed fee 
and the filing of a petition stating the ground therefor, apply 
to the Director to cancel such registration. The Director shall 
refer such application to the Trademark Trial and Appeal Board, 
which shall give notice thereof to the registrant. If it is 
found after a hearing before the Board which that the 
registrant is not entitled to registration, or that the mark 
has been abandoned, the registration shall be canceled by the 
Director. However, no final judgment shall be entered in favor 
of an applicant under section (1)(b) before the mark is 
registered, if such applicant cannot prevail without 
establishing constructive use pursuant to section 7(c).

           *       *       *       *       *       *       *


   TITLE VIII--FALSE DESIGNATIONS OF ORIGIN, FALSE DESCRIPTIONS, AND 
                           DILUTION FORBIDDEN

    Sec. 43. (a) * * *

           *       *       *       *       *       *       *

    [(c)(1) The owner of a famous mark shall be entitled, 
subject to the principles of equity and upon such terms as the 
court deems reasonable, to an injunction against another 
person's commercial use in commerce of a mark or trade name, if 
such use begins after the mark has become famous and causes 
dilution of the distinctive quality of the mark, and to obtain 
such other relief as is provided in this subsection. In 
determining whether a mark is distinctive and famous, a court 
may consider factors such as, but not limited to--
            [(A) the degree of inherent or acquired 
        distinctiveness of the mark;
            [(B) the duration and extent of use of the mark in 
        connection with the goods or services with which the 
        mark is used;
            [(C) the duration and extent of advertising and 
        publicity of the mark;
            [(D) the geographical extent of the trading area in 
        which the mark is used;
            [(E) the channels of trade for the goods or 
        services with which the mark is used;
            [(F) the degree of recognition of the mark in the 
        trading areas and channels of trade used by the marks' 
        owner and the person against whom the injunction is 
        sought;
            [(G) the nature and extent of use of the same or 
        similar marks by third parties; and
            [(H) whether the mark was registered under the Act 
        of March 3, 1881, or the Act of February 20, 1905, or 
        on the principal register.
    [(2) In an action brought under this subsection, the owner 
of the famous mark shall be entitled only to injunctive relief 
as set forth in section 34 unless the person against whom the 
injunction is sought willfully intended to trade on the owner's 
reputation or to cause dilution of the famous mark. If such 
willful intent is proven, the owner of the famous mark shall 
also be entitled to the remedies set forth in sections 35(a) 
and 36, subject to the discretion of the court and the 
principles of equity.
    [(3) The ownership by a person of a valid registration 
under the Act of March 3, 1881, or the Act of February 20, 
1905, or on the principal register shall be a complete bar to 
an action against that person, with respect to that mark, that 
is brought by another person under the common law or a statute 
of a State and that seeks to prevent dilution of the 
distinctiveness of a mark, label, or form of advertisement.
    [(4) The following shall not be actionable under this 
section:
            [(A) Fair use of a famous mark by another person in 
        comparative commercial advertising or promotion to 
        identify the competing goods or services of the owner 
        of the famous mark.
            [(B) Noncommercial use of a mark.
            [(C) All forms of news reporting and news 
        commentary.]
    (c) Dilution by Blurring; Dilution by Tarnishment.--
            (1) Injunctive relief.--Subject to the principles 
        of equity, the owner of a famous mark that is 
        distinctive, inherently or through acquired 
        distinctiveness, shall be entitled to an injunction 
        against another person who, at any time after the 
        owner's mark has become famous, commences use of a mark 
        or trade name in commerce that is likely to cause 
        dilution by blurring or dilution by tarnishment of the 
        famous mark, regardless of the presence or absence of 
        actual or likely confusion, of competition, or of 
        actual economic injury.
            (2) Definitions.--(A) For purposes of paragraph 
        (1), 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. In determining whether a mark possesses 
        the requisite degree of recognition, the court may 
        consider all relevant factors, including the following:
                    (i) The duration, extent, and geographic 
                reach of advertising and publicity of the mark, 
                whether advertised or publicized by the owner 
                or third parties.
                    (ii) The amount, volume, and geographic 
                extent of sales of goods or services offered 
                under the mark.
                    (iii) The extent of actual recognition of 
                the mark.
            (B) For purposes of paragraph (1), ``dilution by 
        blurring'' is association arising from the similarity 
        between a mark or trade name and a famous mark that 
        impairs the distinctiveness of the famous mark. In 
        determining whether a mark or trade name is likely to 
        cause dilution by blurring, the court may consider all 
        relevant factors, including the following:
                    (i) The degree of similarity between the 
                mark or trade name and the famous mark.
                    (ii) The degree of inherent or acquired 
                distinctiveness of the famous mark.
                    (iii) The extent to which the owner of the 
                famous mark is engaging in substantially 
                exclusive use of the mark.
                    (iv) The degree of recognition of the 
                famous mark.
                    (v) Whether the user of the mark or trade 
                name intended to create an association with the 
                famous mark.
                    (vi) Any actual association between the 
                mark or trade name and the famous mark.
            (C) For purposes of paragraph (1), ``dilution by 
        tarnishment'' is association arising from the 
        similarity between a mark or trade name and a famous 
        mark that harms the reputation of the famous mark.
            (3) Exclusions.--The following shall not be 
        actionable as dilution by blurring or dilution by 
        tarnishment under this subsection:
                    (A) Fair use of a famous mark by another 
                person in comparative commercial advertising or 
                promotion to identify the competing goods or 
                services of the owner of the famous mark.
                    (B) Fair use of a famous mark by another 
                person, other than as a designation of source 
                for the person's goods or services, including 
                for purposes of identifying and parodying, 
                criticizing, or commenting upon the famous mark 
                owner or the goods or services of the famous 
                mark owner.
                    (C) All forms of news reporting and news 
                commentary.
            (4) Additional remedies.--In an action brought 
        under this subsection, the owner of the famous mark 
        shall be entitled only to injunctive relief as set 
        forth in section 34, except that, if--
                    (A) the person against whom the injunction 
                is sought did not use in commerce, prior to the 
                date of the enactment of the Trademark Dilution 
                Revision Act of 2005, the mark or trade name 
                that is likely to cause dilution by blurring or 
                dilution by tarnishment, and
                    (B) in a claim arising under this 
                subsection--
                            (i) by reason of dilution by 
                        blurring, the person against whom the 
                        injunction is sought willfully intended 
                        to trade on the recognition of the 
                        famous mark, or
                            (ii) by reason of dilution by 
                        tarnishment, the person against whom 
                        the injunction is sought willfully 
                        intended to harm the reputation of the 
                        famous mark,
        the owner of the famous mark shall also be entitled to 
        the remedies set forth in sections 35(a) and 36, 
        subject to the discretion of the court and the 
        principles of equity.
            (5) Ownership of valid registration a complete bar 
        to action.--The ownership by a person of a valid 
        registration under the Act of March 3, 1881, or the Act 
        of February 20, 1905, or on the principal register 
        under this Act shall be a complete bar to an action 
        against that person, with respect to that mark, that is 
        brought by another person under the common law or a 
        statute of a State and that seeks to prevent dilution 
        by blurring or dilution by tarnishment, or that asserts 
        any claim of actual or likely damage or harm to the 
        distinctiveness or reputation of a mark, label, or form 
        of advertisement.
    (d)(1)(A) * * *
    (B)(i) In determining whether a person has a bad faith 
intent described under subparagraph (A), a court may consider 
factors such as, but not limited to--
            (I) * * *

           *       *       *       *       *       *       *

            (IX) the extent to which the mark incorporated in 
        the person's domain name registration is or is not 
        distinctive and famous within the meaning of subsection 
        [(c)(1) of section 43] (c).

           *       *       *       *       *       *       *


                 TITLE X--CONSTRUCTION AND DEFINITIONS

    Sec. 45. In the construction of this Act, unless the 
contrary is plainly apparent from the context--
    The United States includes and embraces all territory which 
is under its jurisdiction and control.
    The word ``commerce'' means all commerce which may lawfully 
be regulated by Congress.

           *       *       *       *       *       *       *

    [The term ``dilution'' means the lessening of the capacity 
of a famous mark to identify and distinguish goods or services, 
regardless of the presence or absence of--
            [(1) competition between the owner of the famous 
        mark and other parties, or
            [(2) likelihood of confusion, mistake, or 
        deception.]

           *       *       *       *       *       *       *


                           Markup Transcript


                            BUSINESS MEETING

                        WEDNESDAY, MARCH 9, 2005

                  House of Representatives,
                                Committee on the Judiciary,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 10:00 a.m., in 
Room 2141, Rayburn House Office Building, Hon. F. James 
Sensenbrenner, Jr. [Chairman of the Committee] presiding.
    Chairman Sensenbrenner. The Committee will be in order. A 
working quorum is present comprised entirely of Members of the 
majority party. So rather than doing a ratification of minority 
Committee assignments, since there is no one here to make a 
motion to do that, we will now go to the next item on the 
agenda which is the adoption of S. 167, the ``Family 
Entertainment and Copyright Act of 2005,'' and the Chair 
recognizes the gentlemen from Texas, Mr. Smith, the Chairman of 
the Subcommittee on Courts, the Internet, and Intellectual 
Property for a motion.
    Mr. Smith. Mr. Chairman, I ask unanimous consent that we 
consider the following bills en bloc: S. 167, H.R. 683, H.R. 
1036, H.R. 1037, H.R. 1038.
    Chairman Sensenbrenner. How about House Concurrent 
Resolution----
    Mr. Smith. It's my understanding, Chairman, that needs to 
be considered separately.
    Chairman Sensenbrenner. Okay. Without objection, the 5 
bills mentioned by the gentleman from Texas will be considered 
en bloc, and the Chair recognizes the gentleman from Texas to 
explain them.
    Mr. Smith. I'll try to be brief, Mr. Chairman. The first 
bill, S. 167 really consists of three previous bills that this 
Committee has approved and that passed the House last year. The 
first one is the Family Movie Act, and I think Members will 
recall that that simply gives parents the right to determine 
what their children see when they rent or buy a movie video.
    The second part of this particular bill is the Art Act 
which creates new penalties for those who camcord movies in 
public theaters and who willfully infringe copyright law by 
distributing copies of prereleased works, movies or otherwise.
    The Trademark Dilution Revision Act of 2005 simply, 
basically protects trademarks in a better way and also makes 
sure that people cannot infringe trademarks as easily as they 
do now. It also does a good job of trying to keep us out of 
court to determine some of the ambiguities of that particular 
subject.
    The two technical correction bills are just that, technical 
corrections of the Satellite Viewer, Home Viewer Movie Act, and 
the technical corrections, in addition to the satellite 
corrections are technical corrections of the CARP bill, which 
we approved last year and which passed the House.
    The last bill in the en bloc package, Mr. Chairman, is your 
bill, the Multidistrict Litigation Restoration Act of 2005, and 
I will yield to you to make any comments on that.
    And that would be the quick summary of the five bills en 
bloc.
    [The bill, H.R. 683, follows:]
      
      

  


      
      

  


      
      

  


      
      

  


      
      

  


      
      

  


      
      

  


      
      

  


      
      

  


    Chairman Sensenbrenner. The Chair passes on this.
    Without objection, all Members may place opening statements 
in the record on each of the bills being considered en bloc at 
this time. Hearing no objection, so ordered.
    [The prepared statement of Mr. Berman follows:]
Prepared Statement of the Honorable Howard L. Berman, a Representative 
     in Congress from the State of California, and Ranking Member, 
    Subcommittee on Courts, the Internet, and Intellectual Property
    Mr. Chairman, thank you for scheduling this mark-up of H.R. 683, 
The Trademark Dilution Revision Act of 2005. Nine years after passage 
of the Federal Trademark Dilution Act [FTDA], I believe we have with 
this bill come full circle in ensuring the dilution act reflects the 
original intention of Congress.
    Trademark law does not involve typical intellectual property 
rights. It does not emanate from the Patent and Copyright Clause of the 
Constitution, but rather from the Commerce Clause. Rather than 
protection of property rights, the primary policy rationale for 
traditional trademark law rests on a policy of protecting consumers 
from mistake and deception.
    Protection against trademark dilution seems, in some ways, more 
akin to property protection than consumer protection. Thus, any anti-
dilution legislation should be carefully and narrowly crafted. The goal 
must be to protect only the most famous trademarks from subsequent uses 
that blur the distinctiveness of the mark or tarnish or disparage it. 
Legislation should refrain from expanding the potential of creating 
rights in perpetuity for trademarks. Dilution should once again be used 
sparingly as an ``extraordinary'' remedy, one that requires a 
significant showing of fame.
    This bill narrows the application of dilution by tightening the 
definition of what is necessary to be considered a famous mark. The 
bill eliminates fame for a niche market and lists factors necessary for 
a dilution by blurring claim. With these changes, it is our hope that 
the dilution remedy will be used in the rare circumstance and not as 
the alternative pleading.
    In addition, this bill changes the standard of dilution from 
``actual'' to ``likelihood'' of dilution. This bill addresses the 
classic view of dilution by blurring, that the injury caused by 
dilution is the gradual diminution or whittling away at the value of 
the famous mark, or, as those who have been victims of dilution 
describe, ``death by a thousand cuts''--where significant injury is 
caused by the cumulative effect of many small acts of dilution.
    The language in the bill now squares with what Congress had 
initially intended. I appreciate the expressed need to impose a more 
lenient standard. A ``likelihood of dilution'' standard no longer 
unfairly requires the senior user to wait until injury occurs before 
bringing suit.
    However, most importantly, an amendment was adopted in Subcommittee 
to address the First Amendment and free speech issues that were raised 
at the hearing. The ACLU voiced concerns about the possibility that 
critics could be stifled by the threat of an injunction for mere 
likelihood of tarnishment. Furthermore, they were concerned with the 
balance between the rights of trademark holders and the First 
Amendment. ACLU joined with INTA and AIPLA in crafting a separate 
exemption from a dilution cause of action for parody, comment and 
criticism.
    Finally, different intellectual property owners voiced disagreement 
at the hearing regarding the designation of source language in the 
bill. After some negotiation between the parties, the conflict has been 
resolved, and both AIPLA and INTA support the bill. I believe this 
legislation strikes the delicate balance between protection of property 
rights and encouragement of healthy competition. I urge my colleagues 
to support this bill with the amendment and I yield back the balance of 
my time.

    Chairman Sensenbrenner. Are there any amendments to any of 
the bills?
    [No response.]
    Chairman Sensenbrenner. There being no amendments, without 
objection, the previous question is ordered on reporting the 
bills favorably and the vote on reporting these bills favorably 
will be taken when a reporting quorum is present.
    Without objection the order for the previous question is 
vitiated. There is a Subcommittee amendment on H.R. 683, the 
Dilution Bill. Without objection, the Subcommittee amendment is 
agreed to. Hearing none, so ordered.
    [The amendment follows:]
      
      

  


      
      

  


      
      

  


      
      

  


      
      

  


      
      

  


      
      

  


      
      

  


    Chairman Sensenbrenner. And now without objection, the 
previous question is ordered on reporting the bills favorably 
with H.R. 683 being reported favorably as amended. And the vote 
will be taken at the time that a reporting quorum appears.
    [Intervening business.]
    Chairman Sensenbrenner. If there are no further amendments, 
without objection, the previous question is ordered favorably 
reporting Senate 167.
    We are still one short of a reporting quorum. I would ask 
the Members present to be patient, and as soon as we round up--
here we go. They have been rounded up. [Laughter.]
    The previous question has been ordered on reporting 
favorably the following bills: Senate 167, H.R. 683, H.R. 1036, 
H.R. 1037 and H.R. 1038. So many as are in favor of reporting 
these bills favorably will say aye.
    Opposed, no?
    The ayes appear to have it. The ayes have it, and the bills 
are reported favorably.
    Without objection, those bills which were amended here, 
meaning H.R. 683, will be reported favorably to the House in 
the form of a single amendment in the nature of a substitute, 
incorporating the amendments adopted here today. That unanimous 
consent request also includes Senate 167 as amended.
    Is there any objection?
    [Intervening business.]
    Chairman Sensenbrenner. Okay. Without objection, all 
Members will be given 2 days as provided by House rules, in 
which to submit additional dissenting supplemental or minority 
views, and without objection the staff is directed to make any 
technical and conforming changes.
    [Intervening business.]
    Chairman Sensenbrenner. There being no further business to 
come before the Committee, the Committee stands adjourned.
    [Whereupon, at 10:17 a.m., the Committee was adjourned.]

                                  
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