The bill, which requires the President to sign in order to become law, includes definitions for “blurring” and “tarnishment”. The bill would allow a trademark owner, who had a trademark that was widely recognized by the general consuming public, to seek injunction against someone who made use of an identical or similar trademark that could cause dilution and tarnish the owner’s trademark’s image.
The issue arose after the U.S. Supreme Court ruled against Victoria’s Secret. The retailer filed trademark infringement and dilution claims against an adult toyshop called Victor’s Secret.
The U. S. Supreme Court found that the Federal Trademark Dilution Act (FTDA) did not address tarnishment or injury to an establishment’s reputation and thus, was only applicable when actual dilution of a trademark occurred.
Victoria’s Secret had to present evidence that the Victoria’s Secret trademark had a lessened capacity to identify and distinguish goods and services sold in the Victoria’s Secret stores.
Congress’ bill indicates that the U.S. Supreme Court did not correctly interpret the FTDA, passed in 1995. Congress intended that diluting be stopped at the outset. Once dilution occurred, the goodwill of a trademark might not be restored.
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