Unveiling Trademark Dilution from Scratch to Denouement

Introduction to Trademark Dilution

The concept of Dilution was first introduced in 1927, a theory was propounded namely The Rational Basis of Trademark in the article of Mr. Frank Schechter which says that a common (Generic) name can be registered by anyone, but no one has the exclusive right to that trademark, For instance, the renowned brand Apple has its trademark registered under various classes but the word ‘apple’ diluted under class 29 of the food category. However, Apple is a well-established and widely recognized brand that invests a considerable amount of money in safeguarding its trademark against any potential dilution. Dilution can be understood as giving the owner of a famous trademark standing to forbid others from using that mark by others to protect its exclusivity. It also refers to a diminishment of the distinctive value of a trademark and occurs when the other party uses a similar or identical mark in a way that harms the original one and ultimately results in losses and erosion of consumer perception. In Indian law, the Trademark Act 1999 introduces the concept of Dilution under section 29(4). This concept provides power to a well-known, reputed, and recognised trademark to prevent others from using it. Dilution aims to protect sufficiently strong trademarks which are common in nature from losing their association in the public mind with the brand.

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The doctrine of dilution comes directly in contact with consumers therefore not just for the brands but for consumers’ perspective too it essentially requires prevention of the trademark from its dilution which creates a likelihood of confusion for consumers.

Frank Schechter once said in his arguments that “to unauthorized third party use that “Singular” mark concerned that the mark had to be visible enough to deserve enough to enhance the level of protection”.

He believes that the value of a mark lies in “its selling product” not only in “source or origin”.

Principles of Dilution 

Frank Schechter introduced 2 basic principles that bifurcate the concept of Dilution those are:

2.1. Blurring – refers to weakening the distinctiveness and uniqueness of a mark by using it in connection with dissimilar goods/services. Blurring occurs when the third party’s use of the trademark decreases the likelihood that the mark will serve as a unique identifier of the owner’s product and hinder the selling power of the owner’s mark. For example, Buick aspirin or DuPont shoes or Apple for Jewellery would be forms of blurring.

2.2 Tranishment – refers to hindering the trademark owners’ reputation and involves the unauthorized use of a mark that links it to a product that is cheap in quality, or which depicts in an unwholesome context that is likely to affect adversely on the owner’s product. It debases and damages the brand’s reputation with inferior and disreputable products for example Apple for Adult Video store. 

Doctrine of Dilution in India. 

Initially, the concept of Dilution was not there in the previous statute of 1958. In the 1999 Trademark Act the concept of “dilution” was incorporated. Although the statute does not consist of this word specifically, an interpretation to Section 29(4) of the act refers to this concept of dilution which states that a trademark should be a well-known trademark and have a reputation in India for the application of this section.

As per Section 29(4), A registered trademark will get infringed and lead to dilution if-

(a) The mark is identical or similar to the previously registered trademark

(b) Use in relation to different types of goods and services than those of the registered trade mark.

(c) The registered trademark has a reputation in India which will be negatively affected.

(d) The person will take unfair advantage of the mark without any legitimate reason and ultimately harm its exclusivity.

Judgments on the Concept of Dilution

4.1 In ITC Limited v. Philip Morris ProductsSa & ORS.2010 (42) PTC 572 (Del.) Court refused the registration for Philips Co. and established some essential elements to hold dilution which are.

1. The injured mark must have a reputation in India.
2. The disputed mark should be similar or identical to the original well-known mark.
3. Use of the mark amounts to unfair advantage or damage to the reputation of the registered trademark.
4. Use of the disputed mark unreasonably and without the consent of the owner.

The major contention was on the similarity between the “W” Namaste mark of the welcome group and “M” on the Marlboro pack which is alleged to be deceptively similar to “W” where the court held that ITC never used the mark on the cigarettes and the fame of the ITC Mark could not be extended to mid to high priced cigarettes and focus on the mark’s global look not the common elements.

4.2In Caterpillar Inc. vs. Mehtab Ahmed 99 (2002) DLT 678 Where court observed that the nature of the goods is identical, and it immensely affects the identifying value of the original owner’s mark. This dilution creates confusion about the source and affiliation in the minds of potential customers.

Protective strategies from Dilution.

These are the ways one’s brand can protect their brand from Dilution.

1. Brands should avoid using “Common or Generic” names as their trademark,doing so will cost them a huge finance every time in preventingfrom others using it as well as inmaintaining their uniqueness.
2. Section 29(4) provides statute remedy in case of dilution by filing a case against the other party.
3. Brands should register their trademark in different classes to get better protection.
4. Search for the trademark before adopting because it ensures its availability and identifies potential conflicts that lead to dilution.
5. One should always keep an eye on the trademark journal which is published by the registry to register new trademarks with the collaboration of Trademark experts and Attorneys so that in case someone has filed a similar trademark as yours then you can file opposition on time and protect your trademark from dilution.
6. Always try to choose a coined and distinctive name of the trademark that depicts no meaning for example- KODAK, NOKIA which has fewer chances of getting diluted.

Conclusion

The Doctrine of Dilution protects the potential marks from unfair advantages, that harm the distinctive character and stop fraudulent activities over the years. In India the interpretation and implementation of this concept are quite different from the other states for example – Indian courts emphasize “reputation in India” whereas the US courtsrequire the “necessity of a mark to be famous”, though Indian courts do look into other factors which depend on the facts of case to case. Dilution not only affects the brand financially, economically, and reputation-wise but also harms the interest of innocent purchasers and potential customers. The notion of well-known is almost identical in terms of content and concepts in India and USA, albeit different in its terminology. Although it genuinely germinates with time, the doctrine of dilution is a twisted/baffled doctrine. Being protective through various protective remedies and legal advisory can avoid this situation, but one can’t resist fully as time changes new challenges will always be there.

Author: Deepti, A student at Faculty of law, Delhi university, in case of any queries please contact/write back to us at support@ipandlegalfilings.com or IP & Legal Filing

References

Statutes –

The Trademarks Act 1999

Articles

• https://articles.manupatra.com/article-details/Lots-in-a-Name-Would-diluted-Marks-still-Sell-as-Sweetly
• https://blog.ipleaders.in/doctrine-dilution-trademarks/
• http://scc.duelibrary.in/DocumentLink/K247gjh5 US and Indian Trademark Law: A Comparison by Murugendra B. Tubake*
• http://scc.duelibrary.in/DocumentLink/7V5SULrd Trademark Dilution Doctrine : The Scenario Post Tdra, 2005 by Brajendu Bhaskar*
• http://scc.duelibrary.in/DocumentLink/Oszkv6gB The Concept of Deceptive Similarity: Law & Public Policy By Prabhdeep Kaur Malhotra*

Websites

• https : //spicyip.com
• https://indiankanoon.org/
• https://www.scconline.com/
• https://manuu.edu.in/

Case laws

• ITC Limited VS. Philip Morris Products Sa & ORS.2010 (42) PTC 572 (Del.)
• Caterpillar Inc. vs Mehtab Ahmed and Ors. on 9 August 2002 99 (2002) DLT 678