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Moseley v. V Secret Catalogue, Inc., 537 U.S. 418, 65 U.S.P.Q.2d (BNA) 1801 (2003) (full-text).
Factual Background Edit
Victoria’s Secret sued Victor Moseley, owner of Victor's Little Secret, a store that sold lingerie, adult videos, adult novelties and gag gifts in a strip mall in Kentucky (with lingerie representing only five percent of the store's sales).
Because of the nature of Moseley’s other merchandise, Victoria's Secret claimed that Victor’s Little Secret diluted its famous mark and tarnished Victoria’s Secret’s reputation, as well as infringing its trademark.
Trial Court Proceedings Edit
Appellate Court Proceedings Edit
Supreme Court Proceedings Edit
In a unanimous decision, the U.S. Supreme Court stated that the standard for dilution requires a plaintiff to prove that another trademark actually causes dilution of the distinctive quality of a famous mark. Contrary to other lower courts’ holdings, it is not enough to claim that another trademark is merely likely to dilute a famous mark.
The Court noted the existence of numerous state statutes that protect against trademark dilution, and that those statutes "repeatedly refer to a 'likelihood' of harm, rather than to a completed harm." When contrasted with the language of the Federal Trademark Dilution Act of 1995 (FTDA), "this text unambiguously requires a showing of actual dilution, rather than a likelihood of dilution."
The Court noted that blurring and tarnishment, the two consequences that the FTDA is meant to protect against, are not necessary consequences of "mental association" — just because a mark "reminds" a consumer of a famous mark does not mean that dilution has occurred.
However, the Court disagreed with a Fourth Circuit holding that the "consequences of dilution, such as actual loss of sales or profits, must also be proved." In response to Victoria’s Secret’s complaint that "consumer surveys and other means of demonstrating actual dilution are expensive and often unreliable", the Court said that difficulties in proof are "not an acceptable reason for dispensing with proof of an essential element of a statutory violation", and regardless, such direct evidence may not be necessary "if actual dilution can be reliably proven through circumstantial evidence — the obvious case is one where the junior and senior marks are identical."
The Court remanded the case back to the lower court so the parties can submit additional evidence under this new "actual dilution" standard.