Recap of the Fourth Trademark Scholars Roundtable at DePaul University

By Eric Goldman

In April, Graeme Dinwoodie and Mark Janis once again convened a roundtable of trademark law scholars to geek it out on trademark law. Group photo. This year’s theme was “trademark boundaries,” i.e., how trademark law abuts against other legal doctrines (such as copyright, patent or publicity rights) or no doctrines at all (a legally unregulated zone). As usual, Mark Lemley provided a helpful recap of our discussion:

* as a group, we principally interpreted “boundaries” as limits to trademark’s doctrines rather than as frontiers with other doctrines.

* we discussed how often trademark law gives way to conflicts with patent or copyright doctrine. Mark observed that not many of us questioned the supremacy of copyright/patent over trademarks in those conflicting cases. Mark spun through a series of hypotheses why we routinely view trademark law as subordinate to copyright or patent:

- the constitution. Patent and copyright have a Constitutional clause authorizing Congress to protect them. Trademark law exists only under Congress’ general commerce clause powers.

- venerability. Patents can be traced back a half-millennium; copyrights have a history of 300+ years; trademarks are a comparative newcomer, as they are principally a product of the 19th century.

- timing in product development. Copyrights and patent are often part of the thing being sold and are thus part of the discussion from the beginning of the product development cycle, while trademarks become relevant later in the product development cycle.

- public domain concerns. Copyright and patent have clearer paths to the public domain, and thus to enable free copying, than trademark law. Mark didn’t mention it explicitly, but one reason we subordinate trademarks to copyright and patent doctrine is that trademark protection is potentially perpetual, while copyrights and patents aren’t. The Qualitex case expressly referenced this consideration.

Mark noted that none of these explanations are fully satisfactory. As a result, we should reexamine why we denigrate trademarks’ status relative to copyrights and patents.

* where they conflict, we presume trademark law preempts state doctrines. This may be a subset of general federal/state supremacy issues.

* the group spent as lot of time discussing functionality, especially aesthetic functionality. Mark asked if we need two separate functionality doctrines. He thinks perhaps we could develop a unified doctrine, which may have the collateral benefit of keeping the doctrine from being treated like a stepchild. We spent substantial time wondering about the role of aesthetic functionality, which is at the border of trademark law and both copyrights and design patents. Perhaps the term “functionality” throws us off; Stacey Dogan offered the alternative terminology of “aesthetic utility,” which may be a more accurate descriptor.

* there was near-consensus that we should overcome any tendency to feel like “there must be some applicable law” to every situation. One way to counterbalance this impulse is by extolling the virtues of “freedom to copy” or the right to compete, a value that isn’t expressly in the Constitution even though it’s a linchpin of our economy and our system of governance. Previously, Mark observed that competition is what’s left over when there’s not an applicable intellectual property. When IP doctrines grow, competition recedes. Or as Mark McKenna observed, all IP is about unfair competition; competition norms inform IP boundaries. Somehow, we’ve flipped the presumptions and now make defendants prove why they are allowed to copy.

In my summary near the session’s end, I made two main points:

1) Compared to many of my peers, I hold a relatively absolutist position naturally informed by neo-classsical economics. I think trademark law should perform only one task, which is solely to correct specific types of marketplace defects in the marketplace that harm marketplace efficiency—the presentation of product source information that hinders consumers’ abilities to effectuate their preferences. That particular defect in the marketplace hurts society by interfering with the “invisible hand” mechanism.

This takes us to a point raised by Michael Grynberg about institutional competences for enforcement (i.e., the “who” of enforcement, as opposed to the “what”). Comparative institutional competency is a major topic in advertising law (I explored it a bit in my paper on privacy class action lawsuits), so it’s natural to revisit it in the trademark “corner” of advertising law. We rely on trademark owners to enforce their trademark rights, just like we only let competitors enforce Lanham Act false advertising claims. Competitor-initiated enforcement actions have their virtues; after all, no one has greater financial motivation to fix a marketplace defect than a competitor who is losing profits due to legal corner-cutting. But competitor-initiated enforcement has numerous downsides too, including the possibility that it’s motivated by anti-consumer impulses and the collusion risks (i.e., a competitor who lives in a glass house isn’t likely to throw stones at a competitor). Thus, we have a suite of other enforcement mechanisms for advertising law problems, including consumer lawsuits, government regulation, certification bodies, and non-legal recourse.

We don’t need trademark law to solve every problem because these other enforcement mechanisms can shoulder some of the load. In turn, we should resist the impulse to keep expanding trademark law to cover more border cases internally within trademark law, and instead trademark law should “outsource” any non-core problems to other doctrines enforced by other enforcement institutions. There’s a long list of para-trademark rights or other doctrines (ranging from defamation to antitrust law) that can handle legal concerns without expanding trademark law to cover them as well. (Rebecca gave the example of dilution as “defamation-lite,” a point often overlooked in the discussions about dilution’s “merit”).

2) In contextualizing the boundary problem, Bob Bone noted the possibility of both cumulation of doctrines and conflicts of doctrines. I am much more troubled by doctrinal cumulation/overlap than many of my peers. Bill McGeveran and I sparred with each other on this point all weekend; Bill observed that we shouldn’t care about doctrinal tidiness for its own sake, although I in fact would love a lot more doctrinal tidiness. Bill teaches civil procedure and I loath civil procedure (no disrespect intended!), so maybe we just start from different places.

My main objection to overlapping doctrines is that they produce two types of transaction costs. First, when in court, overlapping doctrines impose greater litigation/adjudication costs on all players. This is especially true when different doctrines are resolved at different stages of litigation, i.e., doctrines A-C can be resolved on motions to dismiss and doctrine D requires litigation through summary judgment or even fact adjudication. In those circumstances, when doctrine D isn’t meritorious, the litigants and the court bear additional costs for no extra social payoff.

Second, and more importantly, overlapping doctrines impose substantial extra costs on companies trying to bring products to market. Each doctrine requires its own research/clearance; indeed, my perspective from my in-house counsel days is that these costs grow logarithmically with each new doctrine, not arithmetically. In effect, cumulative doctrines are similar to “IP rights thickets” we lament elsewhere. Clearance costs can dramatically suppress innovation.

Jeremy Sheff rightly noted an internal tension in my two points. He observed that overlap in institutional enforcement scope creates transaction costs just like the transaction costs in doctrinal overlaps that I lamented. I responded that (in theory) we can design the enforcement institutions, and their substantive enforcement portfolios, such that they sit next to each other and don’t overlap. This is probably untrue in practice, especially, as Mark Lemley pointed out, given that regulators tend to regulate and thereby expand their portfolio of responsibilities.

Dastar came up frequently in our discussion, but there was widespread consensus that none of us feel like we understand it. Barton Beebe described Dastar as “so heavy,” which really does sum it up nicely.

Prior years’ recaps:

* First

* Second

* Third

Rebecca’s characteristic quasi-transcription of the discussion:

* Part 1

* Part 2

* Part 3