Conkle, Kremer & Engel has recently obtained several injunctions in a case alleging violations of several state laws, including a state anti-dilution statute. Our clients maintain restrictive distribution systems which prohibit sales by general merchandisers. The court enjoined the sales of the trademarkholder’s goods in a discount warehouse. One of the theories upon which we sought injunctive relief was that the appearance of our clients’ products in the warehouse settings diluted the value of the clients’ trademarks and tended to injure the clients’ business reputations. This is an application of laws protecting trademarks against “dilution.” Anti-dilution statutes can be an effective weapon in the trademark owner’s arsenal.

Classic trademark infringement occurs when a trademark is used by a competitor to confuse customers into believing that the competitor’s goods were made by the owner of the trademark. So, what does the trademark owner do when it is unlikely customers will be “confused,” because the trademark (or something similar) is being used on some completely different good or service? What would you do if something strangely similar to your hard-won trademark turns up gracing an adults-only bookstore on skidrow?

Such a situation faced Tiffany & Co. when it found its famous name for jewelry and other luxury merchandise used in Boston , Massachusetts on a “lower end” food establishment as “Tiffany’s Restaurant and Lounge.” Tiffany sued and the court entered an injunction even though it was unlikely that anyone would confuse Tiffany & Co. with the restaurant. The court’s injunction was based on a state law prohibiting ” dilution ” of a trademark, finding that “. . . defendant’s arbitrary assumption of the name Tiffany’s has a clear tendency to subject the good will and reputation of the plaintiff’s tradename and trademark to the hazards of the defendant’s business.”

Or consider the plight of Coca-Cola, finding its world famous trademark “spoofed” by posters reading “enjoy cocaine” in a script and color scheme identical to that of “Coke.” Again, there was no reason to think anyone would believe Coca-Cola manufactured the cocaine poster, but the court nevertheless issued an injunction preventing the defendant’s use, finding that the posters were likely to dilute and tarnish Coca-Cola’s distinctive trademark for its “wholesome” product.

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