Mayer Brown's Appellate.net


SUPREME COURT DOCKET REPORT


 

2001 Term, Number 13 / April 15, 2002

Today the Supreme Court granted certiorari in one case of potential interest to the business community. Amicus briefs in support of the petitioners are due on Thursday, May 30, 2002, and amicus briefs in support of the respondents are due on Monday, July 1, 2002. Any questions about this case should be directed to Eileen Penner (202-263-3242) or Miriam Nemetz (202-263-3253) in our Washington office.

Trademarks — Dilution — Actual Injury. The Federal Trademark Dilution Act ("FTDA"), 15 U.S.C. § 1125(c), permits the owner of a famous mark to obtain an injunction against another party's commercial use of a mark or trade name that "causes dilution of the distinctive quality of the [famous] mark." The Supreme Court granted certiorari in Victor Moseley and Cathy Moseley, d/b/a Victor's Little Secret v. V Secret Catalogue, Inc., et al., No. 01-1015, to determine whether a showing of actual injury to the famous mark is a necessary element of a claim for relief under the FTDA. 

V Secret Catalogue, Inc. owns the "Victoria's Secret" mark, which it licenses to Victoria's Secret Catalogue, LLC and Victoria's Secret Stores, Inc. ("Victoria's Secret"). Victoria's Secret, which sells women's lingerie and clothing, operates over 750 stores and distributes 400 million copies of its catalogue each year. In February 1998, Victor and Cathy Moseley opened a store called "Victor's Secret," which sold lingerie, adult videos, sex toys, and "adult novelties." Shortly after the store opened, Victoria's Secret sent the Moseleys a letter asking them to cease and desist their use of the name "Victor's Secret." Thereafter, the Moseleys changed the name of their store to "Victor's Little Secret." The word "Little" appeared in small font above the original "Victor's Secret" logo. 

Victoria's Secret sued the Moseleys in federal district court, alleging trademark infringement and trademark dilution. The district court rejected the infringement claim on the ground that there was no likelihood of confusion between the two marks. However, it ruled in favor of Victoria's Secret on its dilution claim, concluding that the Moseleys' mark was sufficiently similar to the Victoria's Secret mark to blur the senior mark's product identification and tarnish it with the junior mark's more "risqué" inventory. Accordingly, the district court enjoined the Moseleys from using the designation "Victor's Little Secret" or any other similar mark. 

The Sixth Circuit affirmed. 259 F.3d 464. The principal issue in the appeal was "whether a plaintiff must prove actual, present injury to its mark to state a federal dilution claim" — a question as to which the Circuits were already divided. Id. at 471. The Sixth Circuit rejected the conclusion of the Fourth and Fifth Circuits that the holder of a famous mark must prove actual, consummated dilutive harm in order to prevail in a claim under the FTDA. See Ringling Bros.-Barnum & Bailey Combined Shows, Inc. v. Utah Division of Travel Development, 170 F.3d 449 (4th Cir.), cert. denied, 528 U.S. 923 (1999); Westchester Media v. PRL USA Holdings, Inc., 214 F.3d 658 [link 2] (5th Cir. 2000). Instead, the court agreed with the Second Circuit that an "inference of likely harm to the senior mark" suffices to state a claim under the FTDA. 259 F.3d at 476 (citing Nabisco, Inc. v. PF Brands, Inc., 191 F.3d 208 (2d Cir. 1999)). See also Eli Lilly & Co. v. Natural Answers, Inc., 233 F.3d 456 [link 2] (7th Cir. 2000) (proof of mere likelihood of dilution sufficient). 

As the Sixth Circuit observed, "requiring proof of actual economic harm [would] make bringing a successful claim under the FTDA extremely difficult" (259 F.3d at 476), especially when a trademark holder seeks a remedy "before dilution has actually caused economic harm to the senior mark" (ibid.). Accordingly, this case is extremely significant to any business that possesses and seeks to protect a famous mark. 

* * * 

The Court also invited the Solicitor General to express the views of the United States with respect to two related petitions of interest to the business community: 

Hillside Dairy Inc. v. Lyons, No. 01-950, and Ponderosa Dairy v. Lyons, No. 01-1018: The principal question presented is whether the Ninth Circuit correctly ruled that Section 144 of the Federal Agriculture Improvement and Reform Act insulates California's milk pricing and pooling laws from challenge under the Commerce Clause. Decision below: 259 F.3d 1148.



This Mayer, Brown, Rowe & Maw Supreme Court Docket Report provides information and comments on legal issues and developments of interest to our clients and friends. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein.




© Copyright 2014. Mayer Brown LLP, Mayer Brown International LLP, Mayer Brown JSM and/or Tauil & Chequer Advogados, a Brazilian law partnership with which Mayer Brown is associated. All rights reserved.

Mayer Brown is a global legal services provider comprising legal practices that are separate entities (the “Mayer Brown Practices”). The Mayer Brown Practices are: Mayer Brown LLP and Mayer Brown Europe Brussels LLP, both limited liability partnerships established in Illinois USA; Mayer Brown International LLP, a limited liability partnership incorporated in England and Wales (authorized and regulated by the Solicitors Regulation Authority and registered in England and Wales number OC 303359); Mayer Brown, a SELAS established in France; Mayer Brown JSM, a Hong Kong partnership and its associated entities in Asia; and Tauil & Chequer Advogados, a Brazilian law partnership with which Mayer Brown is associated. “Mayer Brown” and the Mayer Brown logo are the trademarks of the Mayer Brown Practices in their respective jurisdictions.