Moseley v. v. Secret Catalogue, Inc.

537 U.S. 418, 123 S. Ct. 1115, 155 L. Ed. 2d 1, 2003 U.S. LEXIS 1945
Supreme Court of the United States·Decided March 4, 2003·No. 01-1015·Published·Cited by 194 cases

Opinions

Justice Stevens

delivered the opinion of the Court.

In 1995 Congress amended §43 of the Trademark Act of 1946, 15 U. S. C. § 1125, to provide a remedy for the “dilution of famous marks.” 109 Stat. 985-986. That amendment, known as the Federal Trademark Dilution Act (FTDA), describes the factors that determine whether a mark is “dis[421] tinctive and famous,” and defines the term “dilution” as “the lessening of the capacity of a famous mark to identify and distinguish goods or services.”1 The question we granted [422] certiorari to decide is whether objective proof of actual injury to the economic value of a famous mark (as opposed to a presumption of harm arising from a subjective “likelihood of dilution” standard) is a requisite for relief under the

I

Petitioners, Victor and Cathy Moseley, own and operate a retail store named “Victor’s Little Secret” in a strip mall in Elizabethtown, Kentucky. They have no employees.

Respondents are affiliated corporations that own the VICTORIA’S SECRET trademark and operate over 750 Victoria’s Secret stores, two of which are in Louisville, Kentucky, a short drive from Elizabethtown. In 1998 they spent over $55 million advertising “the VICTORIA’S SECRET brand-one of moderately priced, high quality, attractively designed lingerie sold in a store setting designed to look like a worn-[423] [a]n’s bedroom.” App. 167, 170. They distribute 400 million copies of the Victoria’s Secret catalog each year, including 39,000 in Elizabethtown. In 1998 their sales exceeded $1.5 billion.

In the February 12, 1998, edition of a weekly publication distributed to residents of the military installation at Fort Knox, Kentucky, petitioners advertised the “GRAND OPENING Just in time for Valentine’s Day!” of their store “VICTOR’S SECRET” in nearby Elizabethtown. The ad featured “Intimate Lingerie for every woman”; “Romantic Lighting”; “Lycra Dresses”; “Pagers”; and “Adult Novelties/ Gifts.” Id., at 209. An army colonel, who saw the ad and was offended by what he perceived to be an attempt to use a reputable company’s trademark to promote the sale of “unwholesome, tawdry merchandise,” sent a copy to respondents. Id., at 210. Their counsel then wrote to petitioners stating that their choice of the name “Victor’s Secret” for a store selling lingerie was likely to cause confusion with the well-known VICTORIA’S SECRET mark and, in addition, was likely to “dilute the distinctiveness” of the mark. Id., at 190-191. They requested the immediate discontinuance of the use of the name “and any variations thereof.” Ibid. In response, petitioners changed the name of their store to “Victor’s Little Secret.” Because that change did not satisfy respondents,2 they promptly filed this action in Federal District Court.

The complaint contained four separate claims: (1) for trademark infringement alleging that petitioners’ use of their trade name was “likely to cause confusion and/or mistake in violation of 15 U. S. C. § 1114(1)”; (2) for unfair competition alleging misrepresentation in violation of § 1125(a); [424] (3) for “federal dilution” in violation of the FTDA; and (4) for trademark infringement and unfair competition in violation of the common law of Kentucky. Id., at 15, 20-23. In the dilution count, the complaint alleged that petitioners’ conduct was “likely to blur and erode the distinctiveness” and “tarnish the reputation” of the VICTORIA’S SECRET trademark. Ibid.

After discovery the parties filed cross-motions for summary judgment. The record contained uncontradicted affidavits and deposition testimony describing the vast size of respondents’ business, the value of the VICTORIA’S SECRET name, and descriptions of the items sold in the respective parties’ stores. Respondents sell a “complete line of lingerie” and related items, each of which bears a VICTORIA’S SECRET label or tag.3 Petitioners sell a wide variety of items, including adult videos, “adult novelties,” and lingerie.4 Victor Moseley stated in an affidavit that women’s lingerie represented only about five percent of their sales. Id., at 131. In support of their motion for summary judgment, respondents submitted an affidavit by an expert in marketing who explained “the enormous value” of respondents’ mark. Id., at 195-205. Neither he, nor any other witness, expressed any opinion concerning the impact, if any, [425] of petitioners’ use of the name “Victor’s Little Secret” on that value.

Finding that the record contained no evidence of actual confusion between the parties’ marks, the District Court concluded that “no likelihood of confusion exists as a matter of law” and entered summary judgment for petitioners on the infringement and unfair competition claims. Civ. Action No. 3:98CV-395-S (WD Ky., Feb. 9, 2000), App. to Pet. for Cert. 28a, 37a. With respect to the FTDA claim, however, the court ruled for respondents.

Noting that petitioners did not challenge Victoria’s Secret’s claim that its mark is “famous,” the only question it had to decide was whether petitioners’ use of their mark diluted the quality of respondents’ mark. Reasoning from the premise that dilution “corrodes” a trademark either by “ ‘blurring its product identification or by damaging positive associations that have attached to it,’ ” the court first found the two marks to be sufficiently similar to cause dilution, and then found “that Defendants’ mark dilutes Plaintiffs’ mark because of its tarnishing effect upon the Victoria’s Secret mark.” Id., at 38a-39a (quoting Ameritech, Inc. v. American Info. Technologies Corp., 811 F. 2d 960, 965 (CA6 1987)). It therefore enjoined petitioners “from using the mark ‘Victor’s Little Secret’ on the basis that it causes dilution of the distinctive quality of the Victoria’s Secret mark.” App. to Pet. for Cert. 38a-39a. The court did not, however, find that any “blurring” had occurred. Ibid.

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Moseley v. v. Secret Catalogue, Inc., 537 U.S. 418, 123 S. Ct. 1115, 155 L. Ed. 2d 1, 2003 U.S. LEXIS 1945 (2003).

537 U.S. 418 (Moseley v. v. Secret Catalogue, Inc.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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