Tarnishment and the FTDA: Lessening the Capacity To Identify and Distinguish

Brigham Young University Law Review, 2004 by Smith, Layne T

2. The Supreme Court's tarnishment comment

The Supreme Court, in dicta, also applied a similar analysis to the tarnishment issue, arguing that it should not be actionable under the FTDA.118 The crux of the Court's position was the absence of the phrase "injury to business reputation" in the FTDA. The Court explained that the Moseleys

have not disputed the relevance of tarnishment, . . . presumably because that concept was prominent in litigation brought under state antidilution statutes and because it was mentioned in the legislative history. Whether it is actually embraced by the statutory text, however, is another matter. Indeed, the contrast between the state statutes, which expressly refer to both "injury to business reputation" and to "dilution of the distinctive quality of a trade name or trademark," and the federal statute which refers only to the latter, arguably supports a narrower reading of the FTDA.119

The Court does not conduct a direct analysis of the text of the FTDA, nor of what that text "actually embrace[s]," to support its position. Instead, the Court only appeals to the contrast between state and federal statutes as an indication that the federal statute does not include dilution by tarnishment. The Court seems to place little weight on the indications in the legislative history that Congress intended to include tarnishment as a cause of action.120 In sum, the Court's sole comment concerning tarnishment is far from a thorough analysis of the issue and does little more than introduce the Court's initial view that tarnishment claims may not be supported by the text of the FTDA.

3. Comments on legislative history at oral argument

At oral argument in Moseley, several justices questioned whether the FTDA encompassed tarnishment.121 Walter Dellinger, the Solicitor General, posed two responses to this question. First, he explained that trademarks serve a quality-identifying purpose122 and that tarnishment lessens the capacity of the mark to serve that purpose.123 Second, Mr. Dellinger argued that when the FTDA employed the word "dilution," it was using the word "as a term of art" to encompass both blurring and tarnishment.124 One justice disagreed with Mr. Dellinger's argument, asserting that the "definition of 'dilution' does not at all cover disparaging the other product."125 Mr. Dellinger responded that "Congress thought otherwise" and alluded to House Report 104-374.126 A justice quickly countered: "What Congress thought was the definition that Congress adopted."127

F. The Reaction to Moseley

The Supreme Court's comment in dicta regarding tarnishment "could not give a stronger signal" to trademark holders that tarnishment claims may no longer be valid under the FTDA.128 To date, however, no court since Moseley has addressed the issue.129 Nevertheless, Moseley is still fresh, and very few tarnishment cases have tested the waters. The Supreme Court's preliminary position on the issue undoubtedly opens the door for the validity of tarnishment claims under the FTDA to be hotly litigated in the lower courts.