Nominative Fair Use in the Second Circuit – A New Approach?

trademark infringement_mburton"Nominative Fair Use": what is this doctrine and how are the courts recognizing and applying it to claims of trademark infringement under the Lanham Act?  Nominative fair use is a doctrine that originated in the Ninth Circuit Court of Appeals as a way to deal with situations in which the alleged infringer uses the trademark or certification mark of another not to describe the alleged infringer's goods or services but the trademark holder's goods or services.  The doctrine permits such use so long as there is no likelihood of confusion as to source or affiliation or sponsorship by the trademark holder.  Nominative fair use is not found in the Lanham Act and perhaps this is why different courts have treated and analyzed the concept differently.  The Second Circuit recently joined the discussion by officially recognizing the doctrine in Int'l Info. Sys. Sec. Certification Consortium, Inc. v. Sec. Univ., LLC, No. 14-3456-cv, 2016 U.S. App. LEXIS 9045 (2d Cir., May 18, 2016), albeit not exactly like the other circuit courts have done.

The basic facts in Int'l Info. Sys. Sec. are as follows: the plaintiff (called "ISC2") owns a registered certification mark, CISSP, to denote a person "who has met certain requirements and standards of competency in the information security field, including passing the CISSP certification examination that ISC2 administers."  The Defendant Security University ("SU") offers classes that prepare individuals to take the CISSP certification examination and has a license to use the CISSP mark in connection with its specific training courses.  (The license specifically provides that a license "may not combine the Logo with any other object, including but not limited to other logos, icons, words, graphics, photos [or] slogans.")  Between 2010 and 2012, SU advertised one of its instructors as "Master CISSP Clement Dupuis." ISC2 felt that this advertisement was misleading because it suggested there was some higher level of certification as a "CISSP Master."  When ISC2 told SU to stop using "Master CISSP" in its advertising, SU responded that it would continue to use the word "Master" because Clement Dupuis was a male teacher and thus was a "master" according to the dictionary.  (SU stopped using the word "master" as of 2012, however).  ISC2 sued SU for infringement of its certification mark.  The district court granted summary judgment in favor of SU on the basis of the nominative fair use doctrine.

On appeal of the district court's decision, the Second Circuit held:

"Having considered other circuits' nominative fair use tests, as well as our own prior treatment of cases involving nominative use of marks, we hold that nominative fair use is not an affirmative defense to a claim of infringement under the Lanhan Act. We further hold that in nominative use cases, in addition to considering the Polaroid [Corp. v. Polaroid Elecs. Corp., 287 F.2d 492 (2d Cir. 1961)] factors, courts are to consider (1) whether the use of the plaintiff's mark is necessary to describe both the plaintiff's product or service and the defendant's product or service, that is, whether the product or service is not readily identifiable without use of the mark; (2) whether the defendant uses only so much of the plaintiff's mark as is necessary to identify the product or service; and (3) whether the defendant did anything that would, in conjunction with the mark, suggest sponsorship or endorsement by the plaintiff holder, that is whether the defendant's conduct or language reflects the true or accurate relationship between the plaintiff's and defendant's products or services."

The Second Circuit further elaborated on these points and held that when assessing the second nominative fair use factor, a court is to consider "whether the alleged infringer stepped over the line into a likelihood of confusion by using the senior user's mark too prominently or too often, in terms of size, emphasis, or repetition." In addition, the Second Circuit held that when considering the third nominative fair use factor, a court must "consider confusion regarding affiliation, sponsorship, or endorsement by the mark holder."

For those practitioners familiar with the concept of nominative fair use, the Second Circuit's adoption of the principle does not appear to be all that different from the tests used in the other circuits. Indeed, the Second Circuit recognizes the same three key factors originally enunciated by the Ninth Circuit (where the nominative fair use doctrine first appeared in New Kids on the Block v. News Am. Publ'g, Inc., 971 F.2d 302 (9th Cir. 1992)) and used by other courts.  Still, how the Second Circuit treats nominative fair use is different from the other circuits in a few critical aspects.

The Ninth Circuit uses the doctrine as a replacement test for determining likelihood of confusion (one of the elements for a claim for trademark infringement). The Second Circuit, like the Ninth Circuit and the other circuit courts, including the Sixth Circuit, usually looks to a combination of eight factors to determine whether there is a likelihood of confusion in a trademark infringement case.  In the Second Circuit these are called the Polaroid factors.  (In the Ninth Circuit, they are sometimes called the Sleekcraft factors from AMF Inc. v. Sleekcraft Boats, 599 F.2d 341, 348-49 (9th Cir. 1979); in the Sixth Circuit, they are referred to as the Frisch's factors from Frisch's Rests., Inc. v. Elby's Big Boy of Steubenville, Inc., 670 F.2d 642, 648 (6th Cir. 1982)).  In nominative fair use cases, the Ninth Circuit replaces the eight factors with the three nominative fair use factors.  That is, instead of looking at the usual eight factor test, a court in the Ninth Circuit only needs to look at the three nominative fair use factors to decide whether there is a likelihood of confusion.  The Second Circuit, however, saw "no reason to replace the Polaroid test in this context."

The Third Circuit, however, treats nominative fair use as an actual affirmative defense to a claim of trademark infringement, giving defendants broader protection. A defendant can assert nominative fair use as a defense despite a likelihood of consumer confusion.  See, Century 21 Real Estate Corp. v. Lendingtree, Inc., 425 F.3d 211, 220-22 (3d Cir. 2005).  The Second Circuit, however, rejected this approach because nominative fair use is not included in the Lanham Act as one of the enumerated affirmative defenses.

Other circuits have adopted variations of the Ninth Circuit or Third Circuit's tests, or at least recognized the concept without endorsing any particular approach (see, e.g., Swarovski Aktiengesellschaft v. Building #19, Inc., 704 F.3d 44 (1st Cir. 2013); Bd. of Supervisors for La. State Univ. v. Smack Apparel Co., 550 F.3d 465 (5th Cir. 2008)).  With the Second Circuit jumping in, now the courts have another approach they can take when faced with the issue, although it does not really seem to be all that different.

The Sixth Circuit has not formally adopted any nominative fair use test, but it has recognized the principle. In Paccar Inc. v. Telescan Techs., LLC, 319 F.3d 243 (6th Cir. 2003), the Sixth Circuit stated that "this circuit has never followed the nominative fair use analysis, always having applied the Frisch's Restaurants test. We are not inclined to adopt the Ninth Circuit's analysis here. Even we were to do so, [defendant's] use of [plaintiff's] trademarks does not fall within the nominative fair use defense." In 2007, the Southern District of Ohio reviewed the caselaw in the Sixth Circuit and concluded "that while courts have adopted the Ninth's Circuit's definition of a nominative fair use, the courts have declined to adopt the Ninth Circuit's nominative fair use analysis. Instead, the courts have applied the fair use test found in ETW Corp. v. Jireh Publ'g, Inc.[, 332 F.3d 915, 920 (6th Cir. 2003) (whether the defendant used the mark (1) in its descriptive sense; and (2) in good faith)]. Accordingly this Court will do the same." State Farm Mut. Auto. Ins. Co. v. Sharon Woods Collision Ctr., Inc., No. 1:07cv457, 2007 U.S. Dist. LEXIS 86651 (S.D. Ohio, Nov. 26, 2007). Should the Sixth Circuit have a chance to decide on how to deal with nominative fair use in the future, the Second Circuit's approach may be a happier middle ground that it would be inclined to follow, since it seems to combine all tests into one – the eight factor likelihood of confusion test the Sixth Circuit does not want to give up, with the Ninth Circuit's three additional nominative fair use factors.

About The Author

Melinda Burton | Faruki Attorney