Trademark Dilution Revision Act of 2006 (TDRA), Pub. L. No. 109-312, 120 Stat. 1730 (Oct. 6, 2006) (full-text).
- Some trademark owners sought to use the FTDA in ways that arguably went beyond the statute’s scope and purpose (e.g., owners of insufficiently famous marks attempting to sustain an FTDA action and others trying to apply the FTDA to prohibit parody and criticism of their marks).
- Several federal courts narrowly interpreted the FTDA (notably the U.S. Supreme Court in the 2003 case Moseley v. V Secret Catalogue, Inc.).
- Protection against trademark dilution was said to be difficult, if not impossible, to obtain.
- There was a split among the federal circuit courts of appeal over the meaning and application of several central FTDA elements. For example, one federal appellate court has determined that the federal anti-dilution law does not apply to “descriptive” marks that have acquired distinctiveness over time, including famous ones such as MCDONALD’S or KRAFT, because they lack “inherent distinctiveness.”
TDRA was a legislative response to these issues. The TDRA made the following changes to the FTDA:
- Requires that a mark be both famous and distinctive.
- Allows federal dilution protection for famous descriptive marks that have acquired distinctiveness.
- Provides a definition of “famous” to limit application of dilution law to only widely recognized marks.
- Expressly provides that dilution may be actionable if done by tarnishment or by blurring.
- Establishes that the standard of harm in a federal dilution case is “likelihood of dilution.”
- Explicitly requires that the defendant had used a mark as a designation of source for a dilution claim to be actionable, thus adding a free speech safeguard for competitors, disgruntled consumers, and the media to criticize, parody, and comment on the goods or services of the famous mark owner.
Critics of the legislation, however, raised concerns that the bill too heavily favored major corporations over small and future businesses. In addition, they worried that the bill could negatively affect free speech rights, small business commercial speech, and consumer interests. Finally, they believed that the bill amended federal trademark law in a manner that essentially confers to major corporations a monopoly over the use of famous marks that may contain common words and phrases.