Author- Shailja Choudhary
Introduction
In order to prevent others from misusing your brand, trademark registration with the United States Patent and Trademark Office (USPTO)[1] is a must. Yet, there are still a few instances where someone else could legally use your trademark without your permission. The “fair use” theory, codified in the Lanham Act (also known as the Trademark Act) of 1946[2], allows for the unauthorized use of a registered trademark so long as there is no possibility of confusion as to who owns the mark. Registered Proprietors of trademarks profit most from the legal protection they provide against third parties using confusingly similar trademarks. A trademark’s principal purpose is to serve as a source indicator for the goods and services it represents. However, this benefit for trademark owners is not without caveats.
What is Fair Use?
People can tell whether goods or services are from a particular manufacturer or provider. The owner of a trademark may prohibit others from using that trademark in order to prevent consumers from becoming confused about the origin of the products or services. Yet, “fair use” of a trademark allows some uses of a brand without the owner’s permission. In trademark law, “fair use” refers to any use of a mark that does not infringe on the owner’s rights. Fair use is a common defense in trademark infringement cases because it allows someone to use a trademarked word or symbol for its generic or descriptive meaning rather than as a trademark.
Whether or not a certain use of a brand constitutes fair use is determined by the relevant provisions of the Trademarks Act of 1999[3] and the Indian Trademark Regulations of 2017[4], as well as the specific facts of each case.
Fair use as a matter of law may provide a defense to trademark infringement, but it is important to keep in mind that each case must be evaluated on its own merits, taking into account the
specific facts and circumstances at play. As a corollary, fair use in trademark law may vary from jurisdiction to jurisdiction given that trademark law is primarily governed by national legislation. Specifically, there are two types of fair use: Classical fair use and Nominative fair use.
Types of Fair Use of Trademark
‘Fair use of a trademark by any party may be broadly categorized into –
- Classical fair use.
- Nominative fair use.
Classical Fair Use v. Nominative Fair Use
Classical fair use, also known as descriptive fair use, is the practice of using another party’s trademark to describe one’s goods or services. This sort of usage of a trademarked term describes the goods or services without mentioning the trademark’s owner.
Descriptive trademarks are more difficult to obtain and enforce due to the Lanham Act’s[5] restrictions on trademarking such terms to prevent the creation of monopolies on words that are necessary to define goods and services. A “descriptive” word describes some aspect of the product or service, such as its appearance, smell, taste, or function.
Descriptive trademark use refers to when a trademark is used to describe the goods or services it is associated with, such as their type, quality, quantity, purpose, value, country of origin, time of production or rendering, or other attributes. Fair use in the context of a descriptive trademark allows the public to make descriptive use of words or images that are protected as trademarks.
Descriptive fair use is a provision in trademark law that allows the use of another party’s trademark in the description of a product or service without the consent of the trademark owner. In most cases, this type of fair use occurs when an individual or organization uses a phrase that has lost its trademark status but has entered the general lexicon.
Fair use for descriptive purposes requires the following conditions to be met:
- The term should be used descriptively, not as a trademark.
- The term must be used in a generically descriptive manner.
- The word can’t be confusing to buyers.
- The trademark’s distinctiveness must not be harmed by the use of the word.
Trademark nominative usage refers to when a trademark is used in accordance with generally accepted standards and procedures, such as in marketing and sales. The trademark owner’s rights are not being infringed upon by this type of use. Nominative fair use is a legal doctrine that can be used to defend against trademark infringement claims when a registered trademark is used to allude to the goods or services of the mark owner. Because it “names” the legitimate proprietor of the trademark, this usage is classified as nominative.
Nominative fair use of a trademark requires that the user meet the following conditions:
The following conditions must be met for a trademark to be effective:
- The product or service must be easily identifiable, and
- Just a small fraction of the trademark must be used.
- There is no inference of endorsement from the trademark owner in the use of the trademark.
If the owner’s products or services are not readily identifiable without utilizing the mark, then the use of the mark as a noun constitutes fair use under the doctrine of nominative fair use. A media source may use a trademarked term when covering an event or conducting a reader survey, for example. Or, a teacher may offer lessons on how to make use of a certain piece of software; in this case, the teacher may use the name of the software in promotional materials so long as no fraudulent association with the software’s developer is implied.
When Does Trademark Fair Use Apply?
Trademark fair use applies in many different contexts, so long as the mark is used in good faith and is not likely to cause consumer confusion. The following are examples of common fair-use scenarios involving trademarks:
- News reporting and commentary– In a story, commentary, blog, or publication, mentioning another’s trademark is allowed. Trademark owners can’t stifle debate by threatening to sue anyone who dares to criticize them.
- Product reviews– In most cases, it would not be possible to identify a product and write a review without mentioning the brand name. However, those who write product reviews do not have to be concerned with trademark infringement under the fair use doctrine.
- Parody– As there is no chance of customer confusion, parody is an acceptable form of trademark use. If the secondary function of the mark is the punchline to a joke, then customers will get it. Furthermore, the First Amendment protects parody in most judicial systems.
- Comparative Advertising- Consumers can benefit greatly from comparative advertising since it helps them choose between products. Any advertising in such a situation must not be misleading and the trademark may be used exclusively for such objectives as making a comparison.
- Compatibility claims– The term “compatibility claim” refers to a situation in which one party asserts that its goods are compatible with those of another. To use these terms in this context is considered fair use of the terms in question.
- Identifying customers- Businesses frequently include customer or business partner names on promotional materials. A party may utilize the logo of another for these reasons under the doctrine of nominative fair use, but may only use so much of the logo as is necessary to make the connection.
Landmark Cases on fair use of the Trademark
- Somashekar P. Patil v. D.V.G. Patil (2018)[6]
The plaintiffs, Patil and Patil Parimala Works filed a lawsuit against Patil Fragrances, claiming trademark infringement and passing off. Over the course of the dispute, Patil Fragrances had a motion for an interim injunction granted. Due to the respondent’s good faith use of the PATIL surname, the court sided with them and dismissed the appeal under Section 35 of the Trademark Act 1999[7].
- Anil Rathi V. Shri Sharma SteelTech (2019)[8]
The plaintiff and the defendants were both involved in the production of steel goods. Only members of the Rathi family are legally allowed to utilize the RATHI trademark. The court found that Defendant No. 8’s transfer of the trademark to a third party was not done in good faith because it was done by a member of the defendant’s immediate family. The court upheld the plaintiff’s claims because it was able to do so under Section 35 of the Trademarks Act 1999[9].
- Government E-Marketplace v Unilex Consultants & Ors. (2022)[10]
The Delhi High Court ruled in this seminal case that “Nominative Fair Use” is legal so long as the user does not falsely imply sponsorship by the trademark owner and the use is “Reasonably Required.”
Conclusion
A trademark owner’s rights can be infringed upon in limited circumstances, but not entirely, provided the doctrine of fair use is applied. Nominative fair use is a legal principle that allows the accurate identification of a product or service without implying sponsorship or assistance by the trademark’s rightful owner. The fair use of trademarks is important because it strikes a balance between the rights of trademark owners and the liberties of others to appropriately determine and describe products and services. Yet, this is a complicated area of law that must be carefully analyzed on a case-by-case basis.
[1]United States Patent and Trademark Office, 1953
[2] Lanham Act, 1946
[3] Trademarks Act, 1999
[4] Indian Trademark Regulations, 2017
[5] Supra n.2.
[6] 2018 SCC 637
[7] Section 35, The Trademark Act, 1999
[8] Anil Rathi V. Shri Sharma SteelTech, CS(COMM), 654 of 2019
[9] Supra n.6.
[10] Government E-Marketplace v. Unilex Consultants & Ors., CS (COMM) 205/2020
