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Now that Apple’s iPhone has become its biggest source of profits, the company has shown its willingness to defend its smartphone technology in the courtroom. Analysts estimate that in the smartphone industry alone, as much as $20 billion was spent on patent litigation and patent purchases in the last two years. As the patent battles between Apple and Samsung have begun to play themselves out, the world has been forced to take notice and it does not like what it has seen. Major media outlets, such as The New York Times and Forbes, are calling for patent reform. In the wake of all the attention on smartphone patents, a new and more subtle war is being waged – trademark warfare.
Samsung recently launched a commercial poking fun at Apple’s new iPhone 5. The commercial depicts a typical iPhone launch day across America. There are hundreds of consumers waiting in line for hours outside of an Apple store. The commercial makes continuous reference to new functions that will be available in the new iPhone 5, such as 4G speed and a bigger screen, but it then points out that all of these features have been available on the Samsung phone for a long time. The commercial ends with the phrase “The Next Big Thing is Already Here,” referring to its Galaxy SIII.
The advertisement is both subtle (it never explicitly mentions Apple) and obvious (the timing with the release of the iPhone 5, the description of the phones’ features, and the facade of the building all make it clear that the references are to Apple’s iPhone 5). The fair use doctrine recognizes that the nominative use of a competitor’s trademark is an acceptable form of competitive advertising, so long as the use does not confuse as to the source of the product. However, trademark law grants the owner the right to forbid others from diluting its mark. Dilution can take two forms: blurring and tarnishment. Trademark blurring occurs when someone uses a trademark associated with a certain product to signify a product in another market (i.e., Coca-Cola Shoes). Tarnishment, on the other hand, is the weakening of a mark through unsavory or unflattering associations. This is the form of dilution that arguably occurs in the Samsung commercial.
At one point in the commercial, a young man waiting in line turns to another and says, “I guess the Galaxy SIII didn’t work out?” The young man turns back and says, “No, I love the GSIII. It’s extremely awesome. I’m just saving a spot in line for someone.” As it turns out, the spot he is saving is for his parents, who come walking up later in the commercial. Apple markets its brand as “young” and “hip,” the association that Samsung makes is that the iPhone 5 is a smartphone for an older generation. In my opinion this would fit the category of “unflattering association.” The tricky part is that Apple is never explicitly mentioned in the commercial. Apple may have a legal argument that even though the name was never used in the commercial, the “look and feel” of the trade dress in their buildings was used to dilute its mark. This would probably be a difficult case for Apple to make, but I think it would be worth the fight just to show competitors it is not willing to sit back and let others try to tarnish the reputation it has built.
– Talor Bearman
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