Trademark Law - Fair Use

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Fair Use

If you are offering for sale an item made from (example) licensed fabric, trademark law allows the use of the name to accurately describe the item being offered for sale.
Section 33(b)(4) of the Lanham Act states:
"That the use of the name, term, or device charged to be an infringement is a use, otherwise than as a mark, of the party's individual name in his own business, or of the individual name of anyone in privity with such party, or of a term or device which is descriptive of and used fairly and in good faith only to describe the goods or services of such party, or their geographic origin."
The modern standard for determining "fair use" was set in New Kids on the Block v. News America Publishing, Inc., 971 F.2d 302 (9th Cir. 1992).
A Nominative Fair Use Defense must meet 3 requirements:

The product or service in question must be one not readily identifiable without use of the trademark;
Only so much of the mark or marks may be used as is reasonably necessary to identify the product or service;
The user must do nothing that would, in conjunction with the mark, suggest sponsorship or endorsement by the trademark holder.

While a trademark will protect a word which is used by a manufacturer or merchant to identify goods and distinguish them from others, trademark law will not prevent the use of such a word in good faith with a primary purpose of describing a product or service, and not to infringe the trademark resembled by it. Several different factors are considered in determining whether a court will determine that a use is an infringing use or a fair use.
The first factor to be considered is the manner in which the word or mark is being used by the defendant. The only use of a word which will qualify as a fair use will be a use that is not promoted in a trademark sense. To determine whether such a use is being promoted in a trademark sense, factors such as the visual placement, font size, and prominence of the word are considered. Since visual placement in a non-prominent area is not characteristic of trademark usage, such a finding would be considered fair use.
The second factor to consider in deciding whether a use is a fair use is whether the defendant is using the word or mark in good faith. A showing of intentionally using another's word or mark for the purpose of feeding upon the good will of that individual will prompt a court toward finding a defendant's bad faith and therefore, lack of fair use.
The final factor to consider in determining whether a trademark use is a fair use is whether the use of the word or mark is likely to confuse consumers. A finding by the courts that a defendant's use of a word or mark is likely to cause confusion will most likely hinder the court from also considering the use a fair use and lead to a finding of infringement.
The Eleventh Circuit announced that the proper good faith standard "asks whether the alleged infringer intended to trade on the good will of the trademark owner by creating confusion as to the source of the goods or services."
A fair use defense also exists in copyright law, creating limitations on the exclusive rights enjoyed by owners of protected works.
In 1994, The INTA (International Trademark Association) defined fair use citing a Ninth Circuit case.
Court cases about Fair Use:

ETW Corp. v. Jireh Publishing Inc., 67 USPQ2d 1065 (CA 6 2003)
Mattel Inc. v. Walking Mountain Productions, 353 F.3d 792 (9th Cir. 2003)
Scott Fetzer Co. v. House of Vacuums Inc., 381 F.3d 477 (5th Cir. 2004)
KP Permanent Make-Up, Inc. v.Lasting Impression I, Inc, 125 S. Ct. 542 (2004), PDF format article about fair use in context with this decision.

Car-Freshner v S.C. Johnson, 1995, 2nd Cir, Court of Appeals:

It is a fundamental principle marking an outer boundary of the trademark monopoly that, although trademark rights may be acquired in a word or image with descriptive qualities, the acquisition of such rights will not prevent others from using the word or image in good faith in its descriptive sense, and not as a trademark. See Abercrombie & Fitch Co. v. Hunting World, Inc., 537 F.2d 4, 12-13 (2d Cir. 1976); Sunmark, Inc. v. Ocean Spray Cranberries, Inc., 64 F.3d 1055, 1058 (7th Cir. 1995); United States Shoe Corp. v. Brown Group, Inc., 740 F. Supp. 196, 198-99 (S.D.N.Y. 1990); Holzwarth v. Hulse, 14 N.Y.S.2d 181, 181 (Sup. Ct. 1939); Johnson & Johnson v. Seabury & Johnson, 67 A. 36, 38 (N.J. 1907); Restatement (Third) of Unfair Competition § 28 (1995); 3A Louis Altman, Callmann on Unfair Competition, Trademarks and Monopolies § 21.24 (4th ed. 1983); Margreth Barrett, Intellectual Property 760-61 (1995). The principle is of great importance because it protects the right of society at large to use words or images in their primary descriptive sense, as against the claims of a trademark owner to exclusivity. See U.S. Shoe, 740 F. Supp. at 198-199. This common-law principle is codified in the Lanham Act, which provides that fair use is established where "the use of the name, term, or device charged to be an infringement is a use, otherwise than as a mark, . . . which is descriptive of and used fairly and in good faith only to describe the goods or services of . . . [a] party, or their geographic origin." 15 U.S.C. § 1115(b)(4).

Federal Court Cases
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Federal Statutes
Copyright Act 17 U.S.C. 5 | Digital Millenium Copyright Act 17 U.S.C. 12 | Lanham Act 15 U.S.C. 22
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