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Executive Summary

HOUSE TRADEMARK REVISION BILL MARK-UP TENTATIVELY SET for Sept. 12-16 by the House Judiciary/Courts Subcommittee, Rep. Kastenmeier (D-Wis.), the subcommittee chairman, told a Sept. 8 hearing. The hearing by the Courts subcommittee marked the first House action on the bill (HR 4156) since it was introduced March 15 by Rep. Moorhead (R-Calif.). Kastenmeier is pushing to get the bill passed before Congress recesses again in October. Sen. DeConcini's (D-Ariz.) version of the bill was unanimously approved on the Senate floor May 13 with relatively few changes. However, the House version appears to face a major stumbling block in its plans to change Section 43(a) of the Lanham Act, which deals with false and deceptive advertising. The House seeks to include "omissions of material information" and "disparagement" and "tarnishment," or negative advertising, as misrepresentation. These provisions were deleted from the Senate version. Ogilvy & Mather Senior VP and Associate General Counsel Debra Goldstein, representing the American Association of Advertising Agencies (AAAA) at the hearing, stated that the legislation would create the problem of determining "just which omissions are 'material.'" Goldstein noted that "no single ad includes -- or could include -- every feature of the advertised product that every consumer might be in interested in." The AAAA maintains that the legislation has the risk of "substantially disrupting present law in the area of false advertising." Goldstein pointed out that the impact of the "material omissions" standard would be "most acute" in radio and TV advertising where "there are not many products that can be discussed within the compass of a standard 30 or even 60 [second] commercial without omitting some information that some court could deem material." Center for Science in the Public Interest (CSPI) Legal Director Bruce Silverglade supported this section of the bill, saying that it "codifies court decisions that have held that omissions of material facts in advertising constitute a cause of action under the Act." However, CSPI faulted the bill for continuing to limit the "standing to sue" in false advertising cases to commercial competitors. CSPI feels that individual consumers should also have this right. Attorney Roberta Jacobs-Meadway of the Philadelphia law firm Panitch Schwarze Jacobs & Nadel, which specializes in patent and trademark law, described the "disparagement" and "tarnishment" provision as "an attempt to attack truthful comparative advertising, fair comment and parody, irrespective of fair use or First Amendment considerations." The bill's dilution provision, extended from "unique" marks to include "famous" marks, could, according to Jacobs-Meadway, result in confusion about whether a mark is famous or not. She maintained that this may be an "invitation to litigation." Also, she feels that it should be permissible for companies to use the same mark in different product areas, such as Kent cigarettes and Kent handbags, and that this would not be possible if the dilution provision were in effect.

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