Thursday, February 21, 2008

Ninth Circuit amends decision in Jada Toys v. Mattel to apply current dilution law and likelihood of dilution standard

The Ninth Circuit Court of Appeals issued an amended opinion today in the appeal of Jada Toys v. Mattel, Inc., No. 05-55627 (9th Cir. February 21, 2008). For good summaries of the original decision, see blog posts by Seattle Trademark Lawyer and Filewrapper Blog.

While the court' s decision is the same, the primary difference between the two is that the court revised its discussion on dilution to apply the current federal dilution law (the Trademark Dilution Revision Act) instead of the pre-2006 federal dilution law (the Federal Trademark Dilution Act).

In the court’s original decision (link here), the court, in addressing Mattel’s dilution cause of action, applied the old federal dilution standard under the Federal Trademark Dilution Act, as described in the following footnote:

Because this action was filed in 2004, prior to the 2006 amendment of § 1125, see Trademark Dilution Revision Act of 2006, Pub. L. No. 109-312 § 2(1), 120 Stat. 1730, the previous version of § 1125 applies, codified at 15 U.S.C. § 1125(c)(1) (2000).

In the amended order, however, the court has revised its decision to apply the current dilution standard under the Trademark Dilution Revision Act. The court revised the above footnote to read as follows:

We note that in this case the district court applied the prior version of the Federal Trademark Dilution Act (“FTDA”), 15 U.S.C. § 1125(c) (2000), which required a showing of actual dilution. The actual dilution requirement was a product of the Supreme Court’s decision in Moseley v. V Secret Catalogue, Inc., 537 U.S. 418, 433 (2003), where the Court held that the federal dilution statute required a showing of actual dilution. However, since that time the FTDA has been amended so as to require only a likelihood of dilution to succeed. Trademark Dilution Revision Act of 2006 (“TDRA”), Pub. L. No. 109-312 § 2(1), 120 Stat. 1730. In this case, we choose to apply the standard currently in operation so as to adhere to our prior precedent established in Nissan Motor Co. v. Nissan Computer Corp., 378 F.3d 1002, 1009-10 (9th Cir. 2004), in which we held that application of the FTDA to an alleged diluting mark that was in use before the statute’s passage was not retroactive because the FTDA authorizes only prospective relief.

We are aware that in Horphag Research Ltd. v. Garcia, 475 F.3d 1029, 1035 (9th Cir. 2007), we applied the FTDA retroactively, thereby creating an unintentional intra-circuit conflict with Nissan. In Horphag, however, neither party mentioned the TDRA in its briefs, nor moved for a petition for panel rehearing or to vacate the mandate in light of the TDRA’s passage. Moreover, the plaintiff in Horphag prevailed under the more stringent version of the federal dilution statute. Accordingly, recalling the Horphag mandate at this point would serve no purpose.

Slip op. at 1573, n.2.

The court went on to adjust its analysis of the degree of fame a mark retains to recite the non-exclusive list of four factors that a court may consider as stated in 15 U.S.C. § 1125(c)(2)(A) instead of the eight factors listed in the prior version of the statute. Slip op. at 1575.

Finally, the court’s original decision analyzed Mattel’s evidence under the actual dilution standard; however, because the standard under the revised dilution statute is likelihood of dilution, the revised order applies the statutory factors for making a determination of likelihood of dilution by blurring or tarnishment. Slip op. at 1575-76.

The court’s analysis of the evidence and its ultimate conclusion about the district court’s grant of summary judgment remain the same. In the end, the court decided that “a reasonable trier of fact could conclude that this evidence was sufficient to establish the existence of a likelihood of dilution,” (slip op. at 1577) and therefore reversed the district court’s entry of summary judgment based on genuine issues of material fact raised by Mattel’s evidence.

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