OISS FORM 51 (Rev. 11-82) CONGRESSIONAL RECORD PROCEEDINGS AND DEBATES OF THE 98TH CONGRESS

SENATE

BILL DATE PAGE(S) S. 1990 Oct. 21, 198:l S14378-83 Action: Introduced by Mr. Hatch et-al

By Mr. HATCH (for himself. Mr. LEAHY, Mr. THURMOND, Mr. LAXALT, Mr. DOLE, Mr. SIMP­ SON, Mr. GRASSLEY, Mr. DECON- CINI, Mr. BAUCUS, Mr. HEFLIN, Mr. MCCLURE, and Mr. HELMS): S. 1990. A bill to clarify the circum­ stances under which a trademark may be cancelled or abandoned; to the Committee on the Judiciary. CLARIFICATION OF CIRCUMSTANCES FOR TRADEMARK CANCELLATION Mr. HATCH. Mr. President, Federal trademark law has provided consum­ ers and producers with marketplace protection for more than a century. « Consumers are assured-they are pur­ chasing the product that they desire and that the product is of the same consistent quality that they experi­ enced previously in purchasing that trademarked product. Producers know the time, money, and energy invested in developing and establishing prod­ ucts or services which bears trade­ marks will be protected from misap­ propriation. While trademarks are designed pri­ marily to provide protection and assur­ ance, they may not last indefinitely. The Lanham Trademark Act of 1946 provides for cancellation when a mark "becomes the common descriptive name of an article or substance." Both "aspirin" and "escalator" are examples of trademarks that have become common descriptive, or generic names; there are many more. In making these decisions on which terms are generic and which are pro­ tected marks, the courts have followed a standard test that has existed for more than 60 years. That test is October 21, 1983 CONGRESSIONAL RECORD — SENATE S 14379 whether the majority of the public a result of the ninth circuit decision, consumer enjoys in the marketplace, recognizes and accepts the term as a must be resolved. Otherwise, chaos now have been placed in jeopardy by trademark. This standard has been and confusion will result—everyone the ninth circuit's disruptive depar­ well-recognized, well-understood, and will be the loser. An amendment that ture from decades of accepted judicial Well-accepted. It has served to lend clarifies the Lanham Trademark Act, practice. stability and clarity to trademark law that reaffirms and spells out the basic This decision has shaken reputable and litigation involving the determina­ principles that have underscored trademark attorneys as well as many tion whether a trademark is valid. trademark law for more than six dec­ businesses and Members of Congress. Last year, however, a circuit court ades, is the most direct, least compli-' The U.S. Trademark Association, for handed down a ruling that threatens cated and most reasonable way of example, believes the motivational test to undermine this clarity and stability. achieving this goal. employed by the ninth circuit in Anti- In a radical and unwarranted depar­ The bill that I am introducing today v. General Mills Fun Group, ture from accepted judicial practice, for myself and 13 cosponsors will ac­ (684 F.2d 1316 (9th Cir. 1982)), is a the ninth circuit, in a case involving complish that goal. This bill has the "significant threat to the entire trade­ "Monopoly," the popular board game same objectives as S. 1440, which I in­ mark system." After considerable de­ manufactured by Parker Bros, ignored troduced in June of 1983, but reflects liberation, the USTA recently decided the issue of whether the public recog­ the counsel and suggestions of a to support legislative efforts aimed at nized the name as a trademark. number of my colleagues, trademark clarifying the legal basis for determin­ It focused instead on an entirely new attorneys, and others who share our ing when a trademark becomes gener­ issue: Did consumers purchase this concerns. ic. game because they wanted a product Mr. President, in 1921, Judge Like many of us, the members of the made by Parker Bros, or because they Learned Hand articulated the basic USTA are troubled because the ninth wanted to play "a specific real estate standard for determining when a circuit ignored the "dual function" trading game? Because a majority of trademark became a generic name. provision of our trademark law. This consumers surveyed were motivated by That standard was the level, of under­ provision allows trademarks to stand a desire to play the game and not by standing the consumer exhibited re­ when they serve as the proper name of the fact that Parker Bros, manufac­ garding the trademark. If the primary ' a product, article or substance so long tured "Monopoly," the ninth circuit significance of the term was to sym­ as they also serve as an indication of ruled against Parker Bros. bolize the kind or "genus" of goods the product's origin, even if that applying a new standard, one of sold, then the term was generic and origin is unknown or anomymous to turner motivation, the ninth circuit the producer was not entitled to pro­ the consumer. By ruling that consum­ ruled that "Monopoly" had become a tection. If, on the other hand, the ers must associate the trademark with generic name because 65 percent of term meant something "more than a specific company, the ninth circuit the people surveyed said they bought that," then the seller deserved the turned its back on the "dual function" the game because they wanted to play protection of a trademark. This land­ principle that has long been an inte­ "Monopoly," and "don't much care mark decision of Bayer Co. v. United gral part of trademark law. who makes it," while some 32 per­ Drug Co., (272 P.2d 505, 509-(1921)) is cent—a minority—said they bought still followed by many courts. We- are troubled, too, because the "^lonopoly" because they "like Parker Over the years, there have been Anti-Monopoly decision is not an iso­ Bros.' products." some refinements in this standard. In lated case that other judicial courts This new "motivation test" is both the 1938 case of Kellogg Co. v. Nation­ will ignore. The motivational test em­ unjustified and unreasonable. It ig­ al Biscuit Co. (305 U.S. Ill (1938)), ployed by the ninth circuit, as Judge nores past law and commonsense, and, the court said a trademark owner had Nies has stated, has led "some courts most importantly, it is contrary to ac­ to show that "the primary significance into an esoteric and extraneous in­ cepted principles of trademark law. It of the term in the minds of the con­ quiry focusing on what motivates the. denies brand name status to products., suming public is not the product, but purchasing public to buy particular that always have been bought by their the producer" in order to retain the goods." In re DC Comics (689 F.2d brand name, simply because the pur­ trademark. In other words, the con­ 1942, 1954 (C.C.P.A. 1982) (concurring chaser or consumer cannot identify sumer had to recognize the trademark opinion)). the maker or manufacturer. as the name of a product that came Meanwhile, another ninth circuit Pew trademarks can survive this from a particular source, even though court already has referred to the "Mo­ s^ndard, because most consumers the consumer might not be able to nopoly" motivation survey as one con­ lot identify the companies that identify that source. In the 1962 case ducted "according to accepted princi­ ,. Juce the products and goods they of Feathercombs, Inc. v. Solor Prod­ ples." Prudential' Insurance v. Gi- buy. Moreover, accepted trademark ucts, Inc., (306 F.2d 252, 256), the court bralter Financial Corp. (694 F.2d 1150, law does not require this identifica­ said that in order for a trademark to 1156 (9th Cir. 1982)). And, in the case tion, as long as consumers associate become generic, "the principal signifi­ of The Nestle Co. v. Chester's Market the goods'with a single source. They cance of the word must be its indica­ Inc. (D. Conn. 1983), Judge Blumen- do, however, have clear expectations tion of the nature or class of an article feld, in holding that the term "Toll regarding the quality of the products rather than an indication of its House" was generic, cited the Anti-Mo­ they purchase and rely on the trade­ origin." nopoly decision extensively. The judge mark for assurance of this quality. Yet Although these cases have served to also indicated that if a motivation test the ninth circuit has declared these sharpen and clarify- the standard for submitted to the court had not been customary and usual expectations to determining when a trademark be­ deficient with respect to a few techni­ be insufficient. comes generic, the basic and funda­ calities, he would have admitted it as It would be inappropriate for the mental criteria the courts employed evidence. Congress to take action that would for making this determination always The reasons individuals buy prod­ have a retroactive impact on the par­ have remained the same—the level of ucts should have no bearing on these ties affected directly by the ninth cir­ consumer understanding regarding the cases because they are not designed to cuit decision in the Monopoly case. I term in question and whether it could ascertain whether a product has a}so have no wish to further expand be said that a majority of the public become generic. They should have no the authority of existing law. or estab­ recognized the term as a trademark, standing in court and no bearing on lish new standards, definitions or rather than as a descriptive term for these cases, because they do not show boundaries regarding the cancellation an entire type or class of products, whether or not a product has become of trademarks. goods or services. generic. Another survey in the Anti- I do believe, however, that the fun­ This historic standard, as well as Monopoly case asked the public if damental conflict which now exists thousands of reputable trademarks they bought the detergent "Tide" be­ within trademark law and litigation, as and the protection and confidence the cause they wanted a Proctor & S 14380 CONGRESSIONAL RECORD — SENATE October 21, 1983 Gamble product, or if they bought There being no objection, the mate­ "ESOTERIC AND EXTRANEOUS" "Tide" because they thought it did a rial was ordered to be printed in the The motivation test has also been criti­ good job. Sixty-eight percent said they RECORD, as follows: cized • by the United States Patent and bought "Tide" because it did a good [Prom the New York Times, Sept. 7, 1983 Trademark Office. It has been assailed by an appeals judge in another circuit as 'sn job. Does this mean that the "Tide" (Business Day Section)] trademark should now be declared a esoteric and extraneous inquiry." It was ig­ generic name? Of course not. Yet the A LOT RIDES ON A GOOD NAME: TRADEMARK nored by another panel of judges in t&e LAW IS UNSETTLED same circuit in a later case upholding the ninth circuit did not dismiss the (By Paul Hemp) trademark status of "Coke." And it has thought, and that could easily happen To most people, the board game Monopo­ prompted Senator Orrin G. Hatch. Republi­ if we do not take some minimal but es­ ly is nothing more than a pleasant diver­ can of Utah, who said that "most popular sential steps to protect the validity. sion. But for executives, at the Nestle Com­ quality brands" are threatened by the Anti- and integrity of our trademarks and pany and many other consumer products Monopoly decision, to propose an amend­ our system of trademark law. concerns, a lot more than $200 for passing ment to Federal trademark laws that would outlaw the motivation test. Mr. President, the dilemma the Go has been riding on the well-known game. But the Monopoly case itself has retained ninth circuit created was best summed Last month, a trademark case involving its force, despite the criticism. Two recent by Robert C. Lyne, Jr., chief patent Monopoly was cited to support a court find­ decisions invoked the case, though without counsel for Reynolds Aluminum Co. ing that Nestle's "Toll House cookie" is a ge­ expressly relying on its motivation test. when he worte: neric name, one that no longer identifies a In the Nestle Company Inc. v. Saccone's The point of trademark protection is to particular producer. The Toll House deci­ Toll House Inc., Nestle sued the Toll House permit a purchaser to recognize the goods sion invoked a controversial Federal appeals restaurant, where toll house cookies were he wishes to buy_, and to distinguish them court opinion' reached last year that the Mo­ first baked more than 40 years ago, for con­ from other goods" It is not to enable him to nopoly name was a generic term and thus tinuing to sell cookies under the Toll House match up various goods with the companies not a protected trademark. name. Nestle said it owned the right to use that sell them. In the intervening year the Monopoly de­ the Toll House trademark for its chocolate cision has been left intact by the Supreme chips. But a Federal District Court found The bill I introduce today will re­ Court, which in February refused to review that the term "toll house" does not identify solve this ambiguity. it. Besides the recent Nestle decision, the the producer of the ingredients in the cook­ The bill is not intended to effect im­ Monopoly case has been cited in a finding ies. It "is now merely a descriptive term for portant substantive changes in the that Eastern Air Lines' "Air-Shuttle" is a a type of cookie," the court said. mainstream of trademark law. Thus generic name. Moreover, the controversial In Eastern Air Lines Inc. v. New York Air- its purpose remains primarily that of decision, Anti-Monopoly Inc. v. General lines Inc., a Federal District Court heV clarifying and rendering more precise Mills Fun Group Inc., has prompted in­ the term "shuttle" was generic and dU i in the statute what the law is today an creased sensitivity on the part of some busi­ primarily denote Eastern's Air-Shuttle serv­ nesses about their brand names. To that ice. should be in the years to come,- undis­ end, companies are stepping up existing pro­ turbed and undiverted by the trou­ The Anti-Monopoly case, even if an aber­ grams meant to prevent their trademarks ration, has also resulted in increased sensi­ bling and potentially dangerous ele­ from slipping into generic use. tivity to trademark issues among manufac­ ments of the Anti-Monopoly case. In The case "has put the fear of God in turers. short, the bill does four things: people," said J. Thomas McCarthy, who The United States Gypsum Company, First, it disapproves use of the so- teaches trademark law at the University of which makes Sheetrock Brand wall board, called purchaser motivation test in de­ San Francisco Law School. "Marketers are has increased advertising intended to ecjti- termining whether a trademark has listening to their trademark lawyers more cate the public that Sheetrock is a brand, become the common descriptive name now." not a generic, name, according to Kenneth In the Monopoly case, the appeals court E. Roberts, a attorney with the company. of a product or service. in San Francisco said a court may look to "There is increased corporate sensitiviiy Second, it recognizes the dual func­ the motivation behind a buyer's purchase of that our own brand may have some of the tion that a mark plays in the market­ a product, as well as his perception of the same problems discussed in the Monopoly place. product's name, in determining whether case," he said. Third, it recognizes that the name of that name is generic. The case has been . Another method often used by producers a unique product may also function as criticized by many legal commentators as an to protect a trademark is so-called line ex­ a trademark so long as the public asso­ aberration from traditional trademark law. tension, where a brand name that is becom­ ciates that mark with a single source. The Supreme Court, in a case involving ing generic is given to a number of different the name "shredded wheat," said in" the products. The use of the name Vaseline on Fourth, it continues the principle 1930's that a name becomes generic and produsts other than petroleum jelly, and that a mark may identify and distin­ loses trademark status when the "primary Kleenex for products besides facial tissue guish a product from that manufac­ significance" of the term in the minds of are examples of this. tured by others and indicate its source, the consuming public is the product and not A company may also try to' associ', even though anonymous. the producer. popular trademark with a generic term—* or Finally, it conforms various parts of Courts have held that, through years of instance, "Jello Brand gelatin"—or simply the Lanham Trademark Act to assure use, such names as thermos, aspirin and affix the word "brand" to the product name uniformity of application in both the shredded wheat have become part of the whenever possible, as in "Sanka Brand" de­ courts and in the U.S. Patent and language and so lost their trademark status. caffeinated coffee. But is the name signified a "single, albeit Advertising can be less subtle. Well-known Trademark Office. anonymous, source," then it has usually companies such as Xerox confront the prob­ There may be ways in which the lan­ been protected by courts, according to Mr. lem head on by admonishing the consumer guage could be clarified further, and I McCarthy. Such names as Teflon, Formica to use the company's name only in refer­ hope that the careful consideration by and Coke have been upheld as trademarks. ence to the product. "So please: copy things, the Patents, Trademarks and Copy­ In the Monopoly case, General Mills, don't "Xerox' them," one brochure implores. rights Subcommittee, under the able which owns Parker Brothers, sued the leadership of Chairman MATHIAS, will makers of Anti-Monopoly, a game that re­ [From Legal Times, Man 7, 1983] wards players for breaking up monopolies. COURT RULES THAT "MONOPOLY" HAS assist in this regard. This time, however, the court, in addition to I am pleased to introduce this bill on SUFFERED GENERICIDE looking to consumer perception of the name (By Saul Lefkowitz and Barry W. Graham) behalf of myself and Mr. LEAHY, Mr. "Monopoly," focused on whether consumers On Feb. 22, 1983, by refusing to grant cer­ THURMOND, Mr. BAUCUS, Mr. LAXALT, were motivated to buy the game because tiorari, the Supreme Court let stand a deci­ Mr. SIMPSON, Mr. DOLE, Mr. DENTON, Parker Brothers made it. The court found sion of the 9th Circuit Court of Appeals Mr. GRASSLEY, Mr. EAST, Mr. DECON- they were not so motivated. that invalidated the trademark registration CINI, Mr. HEFLIN, Mr. MCCLURE, and This motivation test has been roundly of the term "Monopoly" for Parker Broth­ Mr. HELMS. criticized as irrelevant. "The only people who are going to buy a ers' ever-popular real estate board game. In addition, I would like to include Parker Brothers product because they like The 9th Circuit declared that the term "Mo­ at this point in the RECORD several Parker Brothers are the stockholders," said nopoly" had become generic, i.e. had recent magazine articles which' aptly Brian Leitten, a trademark attorney at Hil­ become a common descriptive name for that characterize the confusion created by lenbrand Industries, makers of the Ameri­ type of board game and thus no longer af­ the Anti-Monopoly case. can Tourister luggage. forded trademark rights-to Parker Brothers. October 21, 1983 CONGRESSIONAL RECORD — SENATE S 14381 the owner of the "Monopoly" trademark the primary significance of the term. The game by asking those individuals to state registration.1 9th Circuit illustrated its position by stating which of the following two statements re­ The "Monopoly" case presents several dif­ the following: flected their thinking: ficult issues concerning "genericide" of a It may be that when a customer enters a 1. I want a "Monopoly" game primarily trademark—the deterioration of a once game store and asks for Monopoly he because I'm interested in playing "Monopo­ valid, protectible trademark into a common means: "I would like Parker Brothers' ver­ ly"; I don't much care who makes it. term available for use by anyone. Of major sion of a real estate trading game, because I concern is the 9th Circuit's use of a novel like Parker Brothers' products. Thus, I am 2. I would like Parker Brothers' "Monopo­ test emphasizing purchaser motivation to not interested in board games made by Anti- ly" game primarily because I like Parker determine the genericness of the "Monopo­ Monopoly, or anyone other than Parker Brothers' products. ly" mark. According to the 9th Circuit the Brothers." On the other hand, the consum­ As it turned out, 65 percent of the individ­ genericness of a once-established trademark er may mean: "I want a Monopoly game. uals surveyed chose the first of the two al­ depends not on any perception that the Don't bother showing me Anti-Monopoly, or ternatives and 32 percent chose the second. public may have concerning the jeopardized Easy Money, or backgammon. I am interest­ The 9th Circuit held that the district court mark, but rather on what motivates a sig­ ed in playing the game of Monopoly. I don't should have concluded'from these survey re­ nificant portion of the product's purchasers much care who makes it." sults that the primary significance of the to buy the trademarked product: a desire to In the first example, the consumer differ­ "Monopoly" term is product rather than have the product or purchaser loyalty to a entiates between Monopoly and other source. known producer. Source-loyalty motivation games according to source-particular crite­ In its petition for a writ of certiorari, filed may be the requirement for mark validity if ria. In the second example, source is not a on Dec. 23, 1982, Parker Brothers contended the 9th Circuit's motivation test becomes consideration. * * • The proper mode of that the 9th Circuit's decision radically al­ the standard. By adopting such a standard analysis is to decide but one question: tered established trademark law in a the 9th Circuit has presented a substantial whether the primary s'ignificanct of a term manner that has immediate and recurring threat to the continued validity of many es­ is to denote products or source.5 practical effect on the merchandising of tablished trademarks used in conjunction On remand, the district court considered goods in the United States. Parker Brothers with well-known products, according to the additional consumer survey evidence, in­ asserted that the 9th Circuit misread and critics of the case. cluding Anti-Monopoly's "motivation" misapplied a landmark Supreme Court case The game.of "Monopoly" was commercial­ survey formulated from the above-quoted (the Shredded Wheat case) and that the de­ ized by in 1933. A U.S. language of the Monopoly I opinion, but cision conflicted with decisions in other cir­ patent issued to Darrow in 1935 was as­ noted the difficult and delicate task of ap­ cuits and the language and policies of the signed to Parker Brothers at that time. In plying the Monopoly I standard. The lower Federal. Trademark Act. In addition, Parker 1935 and 1936, Parker Brothers obtained court, discrediting Anti-Monopoly's motiva­ Brothers argued that the 9th Circuit ex­ fe^Tal registrations for the word "Monopo- tion survey, again held that the term "Mo­ ceeded the review authority given to an ap­ s a trademark for its product. Since nopoly" was not generic and was a valid pellate court by the Federal Rules of Civil , Parker Brothers, now a division of trademark.8 Procedure. CPG Products Corp., has sold more than 80 In the second appeal, Monopoly II,7 the Anti-Monopoly opposed the petition, million sets of the "Monopoly" game in the 9th Circuit considered itself bound by the taking the position that the 9th Circuit de­ United States. law in Monopoly I, the essence of which was cision did not alter established trademark The legal battle that culminated in the stated to be: law, but rather expressly followed the Su­ demise of the term "Monopoly" as a trade­ A word used as a trademark is not generic preme Court's "Shredded Wheat" case with­ mark for the popular board game began if "the primary significance of the term in out conflicting with decisions of other cir­ when Anti-Monopoly, the makers of "Anti- the minds of the consuming public is not cuits. Concerned about the potential effect Monopoly: The 'Bust-the-Trust' Game," the product but the producer." * • * on the 9th Circuit's decision on the vitality bspught an action against the owners of the "[Wlhen a trademark primarily denotes a of other famous trademarks, a variety of federally registered trademark "Monopoly" product, not the product's producer, the bar associations and industry groups sought (Parker Brothers) for a declaratory judg­ trademark is lost." * • * A registered mark leave to file amicus briefs in support of ment of noninfringement and/or invalidity is to be cancelled if it has become "the Parker Brothers' petition for certiorari. Of, the trademark. The declaratory judg­ common descriptive name of an article," 15 However, the petition was denied by the Su­ ment suit had been precipitated by Parker U.S.C. § 1064(c), and no incontestable right preme Court on Feb. 22, 1983. Brothers' claim that the use of the term can be acquired in such a mark. 15 U.S.C. "Monopoly" in the title of the "Anti-Mo­ § 1065(4). We said "Even if only one produc­ NOVEL TEST INTRODUCED nopoly" game was an infringement of its er—Parker Brothers—has ever made the The "Monopoly" case is significant in that registered trademark. Parker Brothers Monopoly game, so that the public necessar­ the Monopoly I and II opinions quite sur­ counterclaimed for a declaration of validity ily associates the product with that particu­ prisingly introduced into trademark juris­ and infringement and sought an injunction lar producer, the trademark is invalid unless prudence a novel purchaser motivation test against Anti-Monopoly. After the trial of source indication is its primary signifi­ . to determine genericness of trademarks in the case, the U.S. District Court for the cance." • * * "It is the source-denoting func­ the marketplace. By doing so, the 9th Cir­ Norther l n District of California held that tion which trademark laws protect, and cuit attempted to focus on the permissible t' erm "Monopoly" had not become a ge- nothing more. [Olne competitor will parameters of the trademark truism that term for the particular and popular not be permitted to impoverish the lan­ the primary function of a mark must be to b*._.d game produced by a single company, guage of commerce by preventing his fel­ denote the source of the product and not was a valid trademark, and had been in­ the product itself. fringed.2 lows from fairly describing their own goods." While the 9th Circuit supported its gener­ DOCTRINE MISAPPLIED . . . "CW]hen members of the consuming icness holding by noting that the term "Mo­ On the first of two appeals, known as Mo­ public use a game name to denote the game nopoly" was used in a unique product pro­ nopoly I, the 9th Circuit determined that itself, and not its producer, the trademark is duced by a single manufacturer and that the lower court had misapplied "the gener­ generic and, therefore, invalid." the term was somewhat descriptive, the icness doctrine" and reversed consideration In Monopoly II, the court held "clearly er­ ramifications of its inquiry into consumer of the genericness issue.3 Finding that the roneous" the lower court's finding of fact motivation and emphasis on that inquiry genericness doctrine had undergone little that "MONOPOLY" primarily denoted the need not be limited to such unique product, change since Kellogg Co. v. National Biscuit producer of the game. After it set out the single source, descriptive type circum­ Co., known as the "Shredded Wheat" case,4 above-quoted, well-established trademark stances. Thus, the motivation test of the the 9th Circuit in Monopoly I stated the de­ law, the 9th Circuit placed much emphasis "Monopoly" case, should it become the cisive question to be whether the primary on Anti-Monopoly's "motivation" survey standard, has far-reaching effect. significance of a term is to describe the and held that the lower court's rejection of Prior to the "Monopoly" case the estab­ product or to denote the producer of that the survey was clearly erroneous. The ap­ lished test, based on a specific provision of product, and if a trademark primarily de­ pellate court found that the term "Monopo­ the Federal Trademark Act and acknowl­ notes a product rather than the product's ly" was not primarily source-indicating but edged by the 9th Circuit itself in the above producer, trademark protection is lost. had become generic when applied to the quote from the Monopoly II opinion, was Concluding that the district court did not board game. Thus, the registration was in­ whether the registered mark had become properly confront the issue of whether the valid, and Parker Brothers' term no longer "the common descriptive name of an arti­ "Monopoly" mark primarily signified the could enjoy trademark protection. cle." • This determination depends on product or its producer, the appellate court CONSUMER MOTIVATION SOUGHT whether the public no longer associates the remanded the case for further proceedings In the motivation survey, Anti-Monopoly term under review with a single, albeit in which the district court was to determine sought to elicit the primary significance of anonymous, source. Thus, the inquiry con­ the term "Monopoly" to individuals who cerns public perception of the term—wheth­ Footnotes at end of article. bought or intended to buy the "Monopoly" er the term was the name of the product— S 14382 CONGRESSIONAL RECORD — SENATE October 21, 1983 and not what motivated the public to buy To put this concern in context, imagine 3 611 F.2d 296 <9lh Cir. 1979) (Monopoly 1). the trademark product. that you are the owner of such a famous * Kellogg Co. v. National Biscuil Co.. 305 U.S. 111 trademark as Procter & Gamble vCo.'s (1938). UNSETTLING MOTIVATION DOCTRINE 5 611 P.2d at 305-06 (emphasis in original). "Tide." and that the continued vitality of C The "Monopoly" case and its emphasis on 515P. Supp. 448 (N.D. Cal. 1981). consumer motivation raises the specter that your heavily promoted and valuable mark 'Reported at 684 P.2d 1316 (9th Cir. 1982). , the continued vitality of a significant depends on passing muster under the 9th " 684 F.2d at 1319 (citations omitted). number of well-known and valuable trade­ Circuit's motivation test—i.e., does a signifi­ • 15 VS.C. §1064 marks, even if they are arbitrary or coined cant portion of purchasers buy your trade- " In re D.C. Comics. Inc.. 689 P.2d 1042 (C.C.P.A. marked product because of loyalty and af­ 1982) . marks and even if they are used in other "Tuxedo Monopoly Inc.. v. General Mills rtm than unique product situations, will depend fection towards the known producer of the product? Would you, as the mark owner, be­ Group. 648 P.2d 1335. 1336 (C.C.P.A. 1981). on whether the purchasing public says it is [From Inc., September 1983] motivated to buy the trademarked product lieve that your mark could survive such a because of loyalty to a named producer test? Do you think the consumer even can NEWS AND TRENDS name the producer of your product? What rather than by a desire to have the product. (By Donna Sammons) The mere possibility that such a motivation could you do, if anything, to avoid the con­ doctrine will become that standard in deter­ sequences of a motivation test? THE NAME OF THE GAME mining trademark validity is in and of itself AFFECTS ADVERTISING STRATEGY The year was 1971 and Ralph Anspach. a unsettling. The 9th Circuit's emphasis or purchaser San Francisco State University economics The 9th Circuit's Monopoly I and II deci­ motivation and loyalty of particular source professor, was sitting in his Berkeley home sions are certainly not without their critics. in determining genericness of a mark cer­ playing Monopoly with his seven-year-old For example, in her concurring opinion in tainly will raise concerns about trademark son. But his mind was not on the game. In re B.C. Comics, Inc.'0 Judge Helen W. usage and product advertising strategy. If "OPEC was just flexing its muscles" An­ Nies, who was well-known as a trademark purchaser motivation is to become a stand­ spach recalls, "so we were talking about the practitioner before being appointed to the ard, trademark owners may very well feel oil crisis. I made some comment about those court, took a position contrary to the 9th the need to stress that a trademark is used darn monopolists and my son said 'Well Circuit Monoply I and II cases regarding use to indicate a particular and identified what's wrong with being a monopolist of purchaser motivation in genericness de­ source. For example, past successful promo­ anyway? I had trouble answering. I realized tion of the distinctive trademark "Tide" for that we'd just been playing Monopoly." The terminations. Without specifically naming laundry detergent may be inadequate to the Monoply I and II decisions, Nies stated next day, Anspach set out to buy a board maintain trademark validity under the 9th game that would show his son some of the that some courts had been misled into fo­ Circuit's motivation test. The proper promo­ cusing on determining whether the goods problems with monopolies. "I looked tion called for now may be nothing less than around" he says "but there was nothing themselves or the producer motivates the -"Procter and Gamble's 'Tide' brand laundry purchasing public to buy particular prod­ available. That's when I decided to put a detergent"—emphasizing particularly the game that would be as much fun as M ucts, an inquiry she classified as "esoteric producer's name while stressing the term and extraneous." She maintained that the "Tide" as a brand name and providing the oly but would also teach something a .at reason the public is motivated to buy a public with an easily used generic name for the advantages of a competitive economy." product—whether it be, for example, qual­ laundry detegent. Anspach called his game "Bust the Trust, ity, particular features, source, pleasing the Anti-Monopoly Game." When his stu­ design, association with other goods, price, This approach is not called for under dents and friends told him "Bust the Trust" durability, taste, or prestige of ownership- long-established trademark law, which re­ sounded like robbing banks or breaking con­ is of concern only to market researchers and quires only a mark to indicate a single fidences, he shortened the name to "Anti- is legally immaterial to the genericness source, even if .that source is anonymous. Monopoly." issue. Purchaser motivation and emphasis Such an approach also could be a heavy ad­ And that was how it all began. Within two on a particular source ignores the reality vertising burden and actually could dimin­ years, Anspach and his fledgling compafiy, that the primary objective of a purchaser is ish the traditional value of developing a Anti-Monopoly Inc., were embroiled in a to obtain particular goods and is, not neces­ well-recognized trademark that stands on its trademark battle that dragged on for nearly sarily to seek out particular sources or pro­ own to ensure the consuming public that a decade. When the dust finally settled, the the product purchased today is essentially ducers. Motivation does not change a term the same as the product bought yesterday controversy had brought forth a landmark serving as a trademark in a generic designa­ under the same trademark. Furthermore, decision with mind-boggling implications for tion. According to Nies, the correct inquiry such a promotion requirement could lead the entire business community—a decision is whether the public no longer associates the public to a brief that there is more than that called into question the very idea of the terms in question with a single source. one producer of "Tide" laundry detergent. trademarks and brand names. And Ralph Additionally, the Monopoly II holding of Such a position is absolutely contrary to Anspach had won. genericide of the term "MONOPOLY" flies basic trademark law. The immediate loser was Parker Bros., a General Mills Inc. division based in Beverly, not only in the face of the two lower court How far is trademark jurisprudence going findings on the issue, but also in the face of Mass., and the country's leading producer of to stray from the statutorily prescribed board games. Since acquiring the rights to a previous Court of Customs and Patent Ap­ "common descriptive name" genericness peals (now the Federal Circuit) determina­ test? Will the continued validity of any Monopoly in 1935, the company ^as tion that Parker Brothers "has built up famous trademark depend solely on a dem­ stamped out more than 80 million, ; enormous goodwill in the mark MONOPO­ onstration that the purchasing public sets—and more than 2.6 billion of e LY, which has been used since 1935 for a thinks of a corporate name when it hears little green houses that generations of Mo­ board game and that MONOPOLY may and uses the distinctive term and that the nopoly mavens have enjoyed stacking up properly be termed a 'famous' mark."" purchase of the trademarked product is along Boardwalk and Park Place. The game The legal "battle and the possible drastic made out of loyalty to the corporate produc­ is now published in 31 countries and 18 lan­ consequences that may flow from the "Mo­ er? guages, including Arabic. nopoly" case with the specter of an ever- If followed, the 9th Circuit's position con­ Over the years, Parker Bros, has gone to present motivation survey challenge have cerning genericness of a term may well great lengths to protect its monopoly on raised grave concern by owners of well- •affect the vitality of a number of existing Monopoly, and it was not about to make an known trademarks and by trade association, trademarks identifying products currently exception for Anspach. He had hardly as well as by numerous trademark lawyers. on the market. Futhermore, trademark begun marketing Anti-Monopoly in 1973 Somewhat amazingly for a trademark case, usage and trademarked product promotion when the company shot off a couple of hell- this suit has received widespread publicity could be influenced greatly by the court's fire and brimstone letters threatening legal and notoriety. The concern is summarized position. It is likely, though, thatythe ra­ action if he did not stop using the name. best by Parker Brothers in its petition tionale of the "Monopoly" case will be Anspach shrugged them off. before the Supreme Court, in which it as­ tested in other courts; and, given the criti­ Not that he was oblivious to the problem. serted: cism the case has engendered, those courts As it happened, he had consulted with two [There exists a] fear that unethical ex­ will have to consider carefully just how different trademark attorneys before set­ ploiters of [nationally known] trademarks broadly it should be applied, if at all. Only tling on the name Anti-Monopoly. Both had may now commission field surveys and, on after a period of reflection through other told him that the owner of an existing receiving reports that more of the public court decisions will the actual impact of the trademark cannot claim infringement b>? a identified the mark with the product than "Monopoly" case be understood. competitor if the na*ne of the competitor's product is the opposite of an existing trade­ with its manufacturer, begin to utilize previ­ FOOTNOTES ously protected trademarks on the ground 1 mark. Such, Anspach concluded, was clearly that they have become generic. Confusion Anti-Monopoly. Inc. v. General Mills Pun the case with Monopoly and Anti-Monopoly. Group. Inc.. 684 P.2d 1316 (9th Cir. 1982). cert, In any event, Anspach had other business and uncertainty will engender litigation, denied (No. 82-1075. Feb. 22, 1983). with enormous costs that will ultimately be 2 P. Supp. . 195 U.S.P.Q. 634 CN.D. Ca). to attend to. Anti-Monopoly was moving borne by consumers. 1977). well—it had sold out in San Francisco—and October 31, 1983 CONGRESSIONAL RECORD — SENATE S 14383 he had hired a distributor to handle the company could lose a trademark by failing chandising Corp. of America Inc., to court- game nationwide. Word came back that to do enough to protect it. For that reason, to challenge its trademark on E.T. store buyers were "going crazy" over Anti- .Xerox Corp. regularly takes out ads remind­ Monopoly. "We'll sell a million copies!" the ing readers that "whether you want a cer­ Mr. LEAHY. Mr. President, I am distributor predicted. tain soft drink or a certain copier, you want pleased to join Senator HATCH in intro­ But then it all turned sour. A rumor to be sure that what you get is the real ducing a bill to solve a serious and began to circulate that Parker Bros, was thing." And The Coca-Cola Co. has been growing problem in our trademark going after Anspach for violating its trade­ known to sue restaurants that serve other law. The cancellation of a Federal mark. Concerned that a judge might block soft drinks to customers who ask for trademark is a serious occurrence. them from selling the games they pur­ "Coke." "When it occurs without justification, chased, wholesalers grew reluctant to place Parker Bros, too, had been diligent in de­ it signals the unwarranted destruction new orders. Anspach's attorneys contacted fending its Monopoly trademark and the Parker Bros, which confirmed that, yes, a of a valuable business asset. To the court did not contend otherwise. Rather, it extent we unduly weaken a system of suit was being prepared. simply bought what Anspach's attorney, They tried to work out a compromise. Carl Person, was saying about Monopoly— trademark prptection that has encour­ Would Parker Bros, forgo legal action if An­ namely, that consumers used the term to aged investment and created jobs for spach changed the, name of his game to refer to the game, not to its manufacturer. generations, we weaken the fabric of "Anti-Monopolist?" No dice, the company To prove his point, he introduced into evi­ American enterprise. responded. What about "Anti-Monopoli" or dence an opinion poll in which consumers No one wants generic words to con­ "Anti-Monopolism?" Forget it, came the were asked whether they had bought a Mo­ reply. nopoly set because they liked the game, or tinue to enjoy trademark status. But What if Anspach agreed to print a dis­ because it was made by Parker Bros. Sixty- for a very long time the law has been claimer of Parker Bros.'s choosing on all five percent said they were motivated to buy settled that a trademark endures so Anti-Monopoly boxes? Monopoly because they wanted to play the long as the public recognizes and ac­ Parker Bros, turned thumbs down to that game, not because it was produced by a cer­ cepts a term as a trademark. Admit­ idea, too. tain company. And the Ninth Circuit Court tedly the test can be difficult where A legal battle seemed unavoidable. An­ took that as proof that Monopoly had the facts are close, but on the other spach's attorneys advised him to file suit become generic. "It is the source-denoting hand the courts have developed the first, locally, in order to keep expenses function which a trademark protects," down. On March 6, 1974, he did just that, expertise to address this test meaning­ wrote the court, "nothing more." fully and accurately. asking the U.S. District Court for the Surveys or opinion polls aren't new to Northern District of California to declare trademark law, but the Monopoly survey Last year, on the strength of a the Monopoly trademark invalid. sought to measure the reasons consumers public opinion survey of doubtful rel­ For the next nine years, the battle raged evance, the ninth circuit introduced a over the name. Along the way, Anspach purchase a product, and that is why trade­ filed two more lawsuits, accusing Parker mark attorneys are upset. They do not like new legal test for cancellation—one Bros, of violating antitrust laws and alleging the idea of motivation surveys one bit, be­ that could do inestimable harm to the unfair competition, he also turned down cause motivation surveys will make it diffi­ stability of trademark law if allowed cult, if not impossible to defend such well- . to stand. The court's new motivation Parker Bros.'s offer to settle the case for known trademarks as Cheerios, Dr Pepper, $500,000—a figure Anspach considered ridic­ Jell-O, Band-Aid, Tide, you name it. Indeed, test tied the continuation of the trade­ ulously low. After all, he had been selling just about any trademark could be in jeop­ mark to the ability of the public to more than 200,000 Anti-Monopoly sets per ardy—provided a challenger can show that identify the maker of the product. year (at $3.60 a set wholesale) until told by The Anti-Monopoly case set forth a the court to stop. people identify the name with the product, Besides Anspach believed he was going to and not the company that makes it. In rule that is unsound in logic and un- win. "Everybody was pretty well agreed," he many cases, that would be quite easy to do. suited to the practical task of identify­ says, "that no jury is going to think Anti- "If you ask someone why he buys Tide de­ ing trademarks that really have Monopoly can be confused with Monopoly. tergent, it's not because he loves Procter & become generic and should be can­ You have to have a very special legal mind Gamble," says Marie Driscoll, a lawyer in celed. to come up with anything as asinine as New York. "He buys it because it does a that." good job washing his clothes. The court Our bill restores the former law in a " Asinine or not, U.S. District Court Judge thinks that would be reason [enough] to de­ straightforward manner and has been Spencer Williams twice ruled that Anti-Mo­ clare Tide generic. The court is wrong." carefully drawn so that new ambigu­ nopoly violated Monopoly's trademark. To Maybe so, but the courts determine the ities are not introduced. It does not tip Anspach's relief, however, the U.S. Ninth law. The key question, then, is whether the balance under prior law in favor of Circuit Court of Appeals twice overrode the other courts will follow the Ninth Circuit the maintenance of a given trademark. decision and the case moved on to the U.S. Court's decision. Of course, some courts It does nothing more than cure the Supreme Court. On February 22, 1983, the have to follow the decision—namely, those problem created in the ninth circuit. high court formally declined to take up the operating in the Ninth Circuit, which covers dispute thereby letting stand the circuit- Alaska, Arizona, California, Guam, Hawaii, The beneficiaries of this bill will be court ruling. Idaho, Montana, Nevada, Oregon, and countless trademark owners and, ulti­ That ruling was a clear-cut victory for An­ Washington. Elsewhere, the issue is not so mately, the consuming public. spach. The court declared that "Monopoly" clear. I want to thank Senator HATCH for had become a generic term and, consequent­ "The decision, if it is followed by courts his hard work on this issue and to urge ly, was no longer a trademark. Ergo, An­ throughout the country, will be of extreme the remainder of my colleagues to spach could start making and selling his importance," says Arthur I. Greenbaum, a help restore the proper legal test in game once again. partner in the law firm of Cowan Liebowitz But the decision did more than break & Latman in New York City, "because it this important area of trademark law. Monopoly's monopoly on its name. As sets forth a view which will doom many Parker Bros, noted in a prepared statement, famous trademarks. We have to see whether it turned trademark law "upside down." For or not other courts throughout the country the first time, a federal court held that, for will follow it. The United States Patent and a trademark to remain valid, it must denote Trademark Office has already taken the po­ primarily the source of the product, not the sition that they will not follow the case. product itself. "That," says Robin A. Rolfe, That's been done formally and publicly in a an attorney and executive director of the brief which was filed." United States Trademark Association in vln the meantime, the fight between An­ New York, "is the part that scares every­ spach and Parker Bros, continues. The case body." is still in U.S. District Court in San Francis­ Traditionally, trademarks have been lost co, where the antitrust and unfair competi­ when people began using the word to refer tion charges brought by Anspach against to more than one product. Aspirin and cello­ the game manufacturer have yet to be tried. phane are prime examples. To a certain While he waits for a trial date to be set, An­ extent, companies can protect their trade­ spach is teaching economics,- and, in his marks from such a fate by doing everything spare time, hawking his game. As for attor­ in their power to make sure that consumers ney Carl Person, Anti-Monopoly's lawyer, identify the trademarked name with the he has bigger plans. At last report, he was specific product in question. Conversely, a taking University City Studios Inc. and Mer­