V Secret Catalogue, Inc. v. Moseley

Court of Appeals for the Sixth Circuit
605 F.3d 382 (2010)

ELI5:

Rule of Law:

Under the Trademark Dilution Revision Act of 2006 (TDRA), the use of a mark that is semantically associated with a famous mark to sell sex-related products creates a strong inference of a likelihood of dilution by tarnishment, which the junior user must rebut with evidence.

Facts:

Victor and Cathy Moseley operated a small retail store in a mall in Elizabethtown, Kentucky.
The Moseleys initially named their store 'Victor's Secret' and later changed it to 'Victor's Little Secret'.
The store sold a wide variety of merchandise, including lingerie, 'sex toys,' and other sexually oriented products.
In February 1998, the Moseleys advertised the store's grand opening in a weekly publication distributed to residents of the nearby Fort Knox military installation.
An Army Colonel at Fort Knox saw the advertisement and, offended by the perceived association with the 'Victoria’s Secret' brand, sent a copy of the ad to V Secret Catalogue, Inc.
V Secret Catalogue, Inc. is an international lingerie company that uses the famous trade name 'Victoria's Secret'.

Procedural Posture:

V Secret Catalogue, Inc. sued Victor and Cathy Moseley in the U.S. District Court for the Western District of Kentucky for trademark dilution.
The district court (a court of first instance) granted summary judgment to Victoria's Secret and issued an injunction.
The Moseleys, as appellants, appealed to the U.S. Court of Appeals for the Sixth Circuit, which affirmed the district court's decision.
The Moseleys, as petitioners, sought and were granted a writ of certiorari by the U.S. Supreme Court.
The Supreme Court reversed the Sixth Circuit's decision, holding that the then-existing federal statute required proof of 'actual dilution,' not merely a 'likelihood of dilution,' and remanded the case.
While the case was on remand, Congress passed the Trademark Dilution Revision Act of 2006 (TDRA), which explicitly changed the legal standard to 'likelihood of dilution.'
On remand, the district court reconsidered the case under the new TDRA standard and, on the same evidentiary record, once again granted an injunction in favor of Victoria's Secret.
The Moseleys, as appellants, appealed the district court's latest decision to the U.S. Court of Appeals for the Sixth Circuit.

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Issue:

Does the use of the name 'Victor's Little Secret' for a retail store that sells adult novelties and sexually oriented products create a likelihood of dilution by tarnishment of the famous 'Victoria's Secret' mark under the Trademark Dilution Revision Act of 2006?

Opinions:

Majority - Merritt, J.

Yes. The use of 'Victor's Little Secret' for a store selling sexually oriented products is likely to cause dilution by tarnishment of the 'Victoria’s Secret' mark. The Trademark Dilution Revision Act of 2006 (TDRA) was enacted to overrule the Supreme Court's prior decision in this same case, which had required proof of 'actual harm.' The new statutory standard is merely a 'likelihood of dilution.' The court holds that when a junior mark is used to sell sex-related products and has a clear semantic association with a famous mark, a strong inference, or rebuttable presumption, of tarnishment arises. This interpretation is supported by a consensus in case law finding that associating a famous mark with lewd sexual activity disparages it. The Moseleys failed to produce any evidence to rebut this strong inference of likely harm to the reputation of the 'Victoria's Secret' mark.

Dissenting - Moore, J.

No. Victoria's Secret failed to produce sufficient evidence to show that the Moseleys' use of the name 'Victor's Little Secret' is likely to harm the reputation of the VICTORIA'S SECRET mark. The plain language of the TDRA requires proof that the association harms the reputation of the famous mark, and likelihood is a higher standard than mere possibility or speculation. The only evidence presented was the testimony of one offended Army Colonel, who explicitly stated that his conception of Victoria's Secret did not change. The majority improperly creates a rebuttable presumption that eliminates the plaintiff's statutory burden to provide evidence of likely reputational harm. Furthermore, since the Victoria's Secret brand itself maintains a 'sexy and playful' image, the context is not as stark as associating a children's brand with pornography.

Concurring - Gibbons, J.

Yes. While fully concurring with the majority's conclusion, this opinion expresses a 'small quibble' with the terminology used. Instead of calling the effect a 'rebuttable presumption,' it would be more accurate to characterize it as a 'strong inference' of tarnishment. This is because the legislative history of the TDRA is not explicit about modifying the burden of proof. However, this distinction is semantic and does not change the practical outcome: to counter the strong inference of likely tarnishment, the defendant is required to come forward with some evidence, which the Moseleys failed to do.

Analysis:

This decision solidifies the lower evidentiary standard established by the Trademark Dilution Revision Act of 2006, confirming Congress's intent to replace the Supreme Court's stringent 'actual harm' test with a more plaintiff-friendly 'likelihood of harm' standard. The court's creation of a 'strong inference' of tarnishment in cases involving sexual association significantly eases the burden for famous mark holders. This precedent makes it much more difficult for junior users to associate a famous mark with unwholesome or sexually explicit themes, as it effectively shifts the evidentiary burden to them to prove their use is not likely to be tarnishing.

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