Alexander Gloor is a JD candidate at Osgoode Hall Law School.

Fashion powerhouse Louis Vuitton has sued car maker Hyundai for trademark infringement stemming from a Super Bowl advertisement. Before reading on, try and spot the alleged infringement. If you paid attention, you may have noticed the design on the basketball, appearing for all of one second in the spot.

Now, it is interesting to ask what exactly it is that Louis Vuitton finds offensive. Certainly, LV has gone to enormous lengths to promote and protect its image. The company associates with the rich and famous, refuses to hold discount sales, has endless battles with counterfeiting and will even (albeit unsuccessfully) sue the makers of parodist dog toys. Yet, Hyundai’s commercial, entitled “luxury”, promotes the image of LV that it has tried so hard to create and maintain. So why is LV concerned?

In fact, LV may not actually “take offence” to the basketball. It may even be the case that they know that they will not win; or at least, they may not really care whether they win or not. In reality, LV quite possibly brought this action out of necessity. This is because the Louis Vuitton brand has become so synonymous with luxury and wealth that it risks losing its distinctiveness by becoming a generic symbol. This is particularly true with respect to the famous LV monogram as well as the pattern at issue. Examples of genericized marks include nylon, aspirin (in the United States) and Pilates. Other brands, such as the Band-Aid brand and Xerox, have been successfully saved from genericism by extensive and smart campaigns.

OK, so does LV stand a chance? Officially, complaints were filed under four headings: common trademark infringement, registered trademark infringement, false designation of origin and trademark dilution. It is the dilution claim, which reads “Hyundai’s conduct is likely to both dilute the distinctiveness and tarnish the reputation of the LVM marks”, that is seen as the most meritorious.

Dilution claims in the United States are governed by the 2006 Trademark Dilution Revision Act, and can fall under two headings. Both of these are included in LV’s claim. The first heading is “tarnishment”; claims may succeed if the use of a mark is seen to tarnish its image. This is unlikely to succeed in this case. As noted previously, Hyundai is using the mark to promote the “luxurious” image that LV itself worked so hard to establish and goes to great pains to maintain. Second is the heading of “dilution by blurring”. This takes place when the mark in question becomes associated with another good, so as to “blur” its actual association and possibly harm its image. While there is no bright line test for determining when dilution by blurring occurs, factors to consider include the similarity of the marks, whether any association between the marks was either actually created or intended to be created by its use, the extent of the use of the mark and the degree of distinctiveness of the mark. The marks are undoubtedly similar, and it is clear that Hyundai was trying to convey a certain image through its use of the mark. However, the fleeting use of the mark and the fact that people would associate the use of the mark with a humourous imitation rather than a serious LV product may well be enough to prevent liability.

In Canada, it is likely that any similar dilution by blurring claims would be prevented by statutory authority. Dilution claims in Canada are captured under the “depreciation of goodwill” test as set forth in paragraph 46 of the Supreme Courts’s 2006 Veuve Clicquot decision, a test that is guided by section 22(1) of the Trade-marks Act. Note that in order to fulfill the test one must “use” the mark, as per section 4(1). In order for goods to be considered “used”, there must be a commercial transfer “in the normal course of trade”. As Hyundai’s use of the basketball in the commercial does not meet that description, s. 22(1) could not be met and LV would have no depreciation of goodwill claim in Canada.

Beyond any monetary reward, Louis Vuitton would certainly like to succeed in its dilution claim to affirm itself as the sole proprietor of the distinctive mark in question. However, win or lose, this action can be seen from Louis Vuitton’s perspective as a necessary reminder to others that a steep price will be paid by those who try and piggyback on their success.

Posted in Famous Marks, Trademarks