January 1, 2013
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UNITED STATES: OSCAR Mark Escapes Dilution Claim Because of Clerical Error in Statutory Language
The U.S. Trademark Trial and Appeal Board (TTAB) recently dismissed a dilution claim in a cancellation proceeding, while noting that the statutory source of the defense was likely a clerical error. Academy of Motion Picture Arts & Sciences v. Alliance of Professionals & Consultants, Inc., 104 U.S.P.Q.2d 1234 (T.T.A.B. Sept. 27, 2012) (precedential). The TTAB acknowledged that a “clerical error” likely occurred when the Trademark Anti-Dilution Act (TDRA) was enacted in 2006 as amendments to the Lanham Act, but nonetheless applied and enforced the statute as written, granting the respondent’s motion to dismiss the petitioner’s claim for dilution by blurring.
The Academy of Motion Picture Arts & Sciences (petitioner) sought to cancel the registration for the mark OSCAR, held by the Alliance of Professionals & Consultants, Inc. (respondent) and covering “providing [of] recognition and incentives by the way of awards and contests to demonstrate excellence in the field of business consultation and information technology” in Class 41. The Academy alleged claims under the Trademark Act for likelihood of confusion under Section 2(d) of the Trademark Act (Lanham Act); false suggestion of a connection with the Academy under Section 2(a); and dilution under Section 43(c), as amended. Instead of filing an answer, the Alliance moved to dismiss the dilution claim pursuant to Federal Rule of Civil Procedure 12(b)(6) on the ground that ownership of a federal registration for its mark was a complete bar to Petitioner’s dilution claim. The Academy asserted that its dilution claim was based not only on Section 43(c) but also under the section of Lanham Act that covers cancellation, and that the amendments that rearranged Section 43(c) could not be read to repeal statutory dilution claims, as this interpretation would lead to “absurd” results.
The federal registration defense existed in the Federal Trademark Dilution Act of 1995 (FTDA), which provided that a federal registration was a “complete bar” to state and common-law claims that alleged dilution of distinctiveness of a mark. In 2006, Congress enacted amendments to the Lanham Act as the TDRA, which sought to expand the federal registration defense to all types of dilution claims under state and common law, replacing the “dilution of the distinctiveness of a mark” language with more expansive language. The TTAB noted that during passage of the TDRA, Senate consideration of the House bill resulted in the relevant portion of Section 43(c)’s being reorganized in a manner that amended it to read that a federal registration acts as a complete bar to common-law, state and federal dilution claims. Noting the likely clerical error, the TTAB held that it “must apply and enforce the statute as written, rather than picking and choosing a preferred interpretation,” leaving it up to Congress to amend the statute if the law was not what was intended.
The TTAB rejected the Academy’s argument that dilution claims had been entertained in other cancellation proceedings since the passage of the TDRA because there was “no showing that the federal registration defense has been raised previously before the Board, and the cases cited by [P]etitioner were not precedential and thus are not binding on the Board.” In conclusion, the TTAB granted the Alliance’s motion to dismiss the dilution claim, and the case moved forward on the Academy’s remaining claims.
Significantly, on October 5, 2012, President Obama signed into law a bill that amends the TDRA to restore the limitation on the federal registration defense based only on state law.
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© 2013 International Trademark Association