Federal Circuit Rules That Use of a Trademark in Advertising Can Infringe Another’s Mark

A federal district court ruled that use of another’s trademark in advertising cannot, as a matter of law, constitute trademark infringement.

The Federal Circuit reversed that ruling in Versatop Support Systems, LLC v. Georgia Expo, Inc. (Fed. Cir. 2019), holding, to the contrary that advertising use can constitute infringement.

Why should advertising use not qualify as infringement?

The answer has to do with the convoluted history and language of the Trademark Act. Briefly, it has long been held that use of a trademark in advertising is not sufficient to acquire trademark rights. But what many courts struggled with is whether use of a trademark in advertising suffices to infringe on another’s, already established, trademark rights.

The Federal Circuit’s ruling means that advertising now may constitute trademark infringement – giving broader protection to trademark owners.

Unlike patent and copyright law, trademark law is specifically limited to the commercial sphere. The Trademark Act does this by using the limiting phrase “use in commerce.

A “use in commerce” is a requirement for trademark registration, 15 U.S.C. § 1051(a)(1), for infringement of a registered trademark, 15 U.S.C. § 1114(1)(a), and for federal unfair competition, 15 U.S.C. § 1125(a)(1), which includes infringement of an unregistered, common law mark.

Thus these statutory provisions implicate two different contexts: (1) whether the trademark owner has acquired trademark rights (and is entitled to registration) through “use in commerce” of the trademark, and (2) whether an infringer has made a “use in commerce” of a mark in a way that is likely to cause confusion.

So what does “use in commerce” mean. The phrase is actually defined in the Lanham Act in 15 U.S.C. § 1127, requiring use of the trademark either on the goods or their containers or on displays associated with the goods. This is known as “technical trademark use” and the statutory definition has long been construed to exclude mere advertising.

This definition certainly applies to whether an owner has acquired trademark rights and qualifies for registration of its trademark. For that, use of a trademark in advertising is insufficient.

The question that has vexed many courts, however, is whether this statutory definition of “use in commerce” also applies to claims of trademark infringement. In other words, what if the infringer merely uses the mark to advertise goods? Can that constitute an infringement? The Federal Circuit in Versatop reversed a district court grant of summary judgment on this very point, holding that advertising use can infringe.

The case involved competitors in the “drape and rod industry” (systems involving metal or plastic piping over which drapery cloths are hung, for room dividers and shading). VersaTop owns the trademark PIPE & DRAPE 2.0 for such goods.

Georgia Expo, a direct competitor, used the identical mark in flyers and brochures directed to a trade show where the goods were being promoted.

The district court ruled that this use in advertisement did not constitute a “use in commerce” and hence did not constitute infringement, applying the restrictive definition contained in 15 U.S.C. § 1127.

The Federal Circuit reversed, holding that for infringement, there is no need for technical trademark use. Any commercial use, including in advertisements, could potentially be an infringement, assuming, of course that the trademark owner can show “likelihood of confusion.”

In Versatop, the Federal Circuit then went on to find that here there was likelihood of confusion, because both the trademark and goods were identical, and they were used in the same channels of trade.

Both trademark owners and potential infringers should be aware that the use of a trademark that implicates infringement is broader than those which acquire trademark rights for a trademark owner. Advertising and other promotional uses of a trademark can, potentially, infringe.