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How does trademark dilution work?

On Behalf of | Aug 18, 2022 | Business Law |

Trademark infringement is when an unauthorized person uses a protected trademark or similar mark to represent a business, brand, service or goods. A trademark holder can hold a registered trademark for ten years under New York Business Law, Article 24. The unauthorized protected mark has to confuse the public into thinking it’s official for trademark infringement.

Counterfeit goods

Business and commercial law covers trademark infringement, such as producing and selling counterfeit goods. Counterfeit goods are a common form of trademark infringement, which are illegal under the Stop Counterfeiting in Manufactured Goods Act. Penalties for counterfeit goods include up to 10 years in prison and $2 million in fines. Under Penal Law section 165.71, New York can prosecute a person to the third degree for willfully manufacturing and selling counterfeit goods. An example of the law is ABC Corp manufacturing and selling sunglasses with a similar Oakley trademark symbol, which can confuse consumers.

Trademark dilution

Another form of infringement is dilution, which can harm a trademark with unauthorized use of similar goods. The law stops everyone except the trademark holder from using famous marks. It’s illegal to use well-known logos without permission, even if it does not confuse the public. Blurring or tarnishment of trademarks can dilute a famous trademark under New York law. Dilution of a famous trademark can hurt the brand value of the trademark holder. Consumers seeing a derivation of a company logo for non-related goods or services can change the public’s perception. Reduced public recognition of a company can come from unauthorized use of a protected mark or one that’s too similar.

The 1995 Federal Trademark Dilution Act considers a trademark famous if the public commonly knows it. An unauthorized person using the trademark can lower the brand’s distinctiveness in the market. The similarity of the two marks may harm the company’s reputation. Counterfeit goods are common trademark infringements, but trademark dilution law helps protect famous trademarks from harm to their brand.

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