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THE NOVEL CORONAVIRUS AND TRADEMARK DILUTION

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THE NOVEL CORONAVIRUS AND TRADEMARK DILUTION

By: Julie Tolek

What is trademark dilution?

“Dilution” occurs when a trade name or trademark being used in commerce is sufficiently similar to a famous mark. Such similarity reduces the public’s perception that the famous mark signifies something unique, singular, or particular.[1] Dilution is a harm that can occur in two ways: blurring or tarnishment. Relevant sections of the Lanham Act, the Federal statute governing trademarks, explains how the court looks at both these types of dilution:

          (B) For purposes of paragraph (1), “dilution by blurring” is association arising from the similarity between a mark or trade name and a famous mark that impairs the distinctiveness of the famous mark. In determining whether a mark or trade name is likely to cause dilution by blurring, the court may consider all relevant factors, including the following:

                    (i) The degree of similarity between the mark or trade name and the famous mark.

                    (ii) The degree of inherent or acquired distinctiveness of the famous mark.

                    (iii) The extent to which the owner of the famous mark is engaging in substantially exclusive use of the mark.

                    (iv) The degree of recognition of the famous mark.

                    (v) Whether the user of the mark or trade name intended to create an association with the famous mark.

                   (vi)Any actual association between the mark or trade name and the famous mark.

          (C) For purposes of paragraph (1), “dilution by tarnishment” is association arising from the similarity between a mark or trade name and a famous mark that harms the reputation of the famous mark.[2]

 

Dilution of the Corona® Beer Brand

Since the beginning of the coronavirus pandemic in early 2020, consumers have related the virus to the popular Corona® beer because of the similarities in the name. This relationship between Corona® beer and the novel coronavirus has created a negative association with the Corona® brand. Chances are you have seen one of the many Corona® beer memes on social media, like this one:

Or this one:

 

Could these memes and other punny jokes about Corona® beer and coronavirus potentially cause dilution of the Corona® beer brand and trademark? Using the factors laid out in 15 U.S.C. § 1125(c)(2)(B), one could argue that “dilution by blurring” could occur because “coronavirus” and “Corona” (beer) have such a high degree of similarity. Corona® beer is a globally recognized mark, and memes referencing the use of “corona” for both Corona® beer and the coronavirus could blur the association between the two. Therefore, Corona® beer could argue it’s losing its distinctiveness.

However, with the reputation of Corona® beer being harmed by its recent association with coronavirus, “dilution by tarnishment” seems a more appropriate type of dilution, if any, under 15 U.S.C. § 1125(c)(2)(C).

 

Are there exceptions as to what uses constitutes dilution?

Exceptions exist as to what kind of use constitutes “dilution by blurring” or “dilution by tarnishment”. 15 U.S.C. § 1125(c)(3) states the following regarding exceptions, referred to as “exclusions” in the statute:

          (3)Exclusions The following shall not be actionable as dilution by blurring or dilution by tarnishment under this subsection:

                    (A)Any fair use, including a nominative or descriptive fair use, or facilitation of such fair use, of a famous mark by another person other than as a designation of source for the person’s own goods or services, including use in connection with—

                              (i) advertising or promotion that permits consumers to compare goods or services; or

                              (ii) identifying and parodying, criticizing, or commenting upon the famous mark owner or the goods or services of the famous mark owner.

                    (B) All forms of news reporting and news commentary.

                    (C) Any noncommercial use of a mark.

It is clear that many “corona” memes and much of the comparison of coronavirus to the Corona® beer brand are intended to have a comic effect and function as parodies—one of the types of fair use of a trademark permitted by the exclusion enumerated in U.S.C. §1125(c)(3)(A)(ii). In addition, although more commonly referred to by its full name “coronavirus”, “Corona” is used in the news and media to reference the virus as part of general news reporting, another dilution exclusion under 15 U.S.C. § 1125(c)(3)(C).

 

Does Corona® the beer company have any legal recourse against the use of “corona” in the context of the coronavirus?

So can Corona® (beer) bring legal action for dilution of their brand? Probably not. Use of Corona® in memes about the coronavirus would probably be considered a parody and fall under the fair use exclusion under 15 U.S.C. § 1125(c)(3)(A)(ii) while use of “Corona” for news reporting would fall under the fair use exclusion under 15 U.S.C. § 1125(c)(3)(C). Moreover, use of the term “Corona” is not being made by a competitor, but, instead, is being used as a reference to the disease which it describes.

No matter what the law says, there’s no denying that the use of the word “Corona” in any context will have a chilling effect for years to come.

 

 

[1] https://www.law.cornell.edu/wex/dilution_(trademark)

[2]  15 U.S.C. § 1125(c)(2)(B)

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