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 Monopoly 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.