Trademark Protection and the Look of the Other

Trademark law gives a limited monopoly to exclude others from using confusingly-similar trademarks. We generally disfavor monopolies as anti-competitive, bad for innovation, and over all bad for consumers. However, we justify trademark law’s limited monopoly because it advances consumer interests, protecting fair competition in the market, incentivizing investment in producing consistently quality goods, and ensuring consumers can safely identify and buy goods they mean to, safe in the knowledge that those goods will meet the standard of quality the consumer values.

This is great, however, we aren’t buying goods for their qualities anymore, we’re buying them for the trademark on that good or service. Actually, even more than that, we’re buying goods so that others will perceive us as being associated with the trademark on that good. Instead of buying authentic, consistently-quality goods, we’re buying goods for that appear to other to be authentic.

This is a shift in what we value, what value means in the marketplace. We don’t value one shoe brand over another because of differences in the quality of the sewing and the durability of the undersole. Instead, what we value is being seen in the eyes of the “Other” as wearing one brand rather than another (so we’re all on the same page, everyone please go read Sartre’s Nausea before we keep going). We want to be seen wearing whatever brand is “popular,” “cool,” or “right” at the time, we want to use the goods to craft a narrative about ourselves, and derive whatever value might be had in being able to dictate the way theOther sees us.

Alexandra Roberts, Professor at the University of New Hampshire School of Law, touches on this in her article on athletes and trademarks, that the athlete’s trademark on a product “serves less as a way to find something and distinguish it from other products and more as a way to express allegiance and fandom.” I agree with Roberts here, and again when she goes on to say that this doesn’t exactly match with our traditional objectives of trademark law.

*Sidebar: I know that for some consumers the authenticity of the good or mark is most important. I think for many though, or at least an increasing group of buyers, what is important is not the authenticity of the good or the mark (or, unfortunately, anything), but that the Other perceives that you are wearing a good or mark associated with a brand, or with the celebrity associated with that brand.

Maybe the difference is that some goods are still (maybe will forever be) bought consistent quality (plywood, cereal, for example), and others for perceived appearance we want (shoes, bags, clothes, etc.), and maybe some are in both. Still, we see cereals look for athlete endorsements, trying to trade on the popularity of the athlete, and is it be crazy to imagine something similar eventually happening for plywood? (@ Portland Timbers, let’s talk marketing strategy). Goods bought for perceived appearance have a value outside the objective value of the product, they have an extra value in some socially manufactured importance the Other attaches to the product, an importance consumers look to buy, often at the cheapest price possible.*

What does this change in value mean for trademark law, and the limited monopoly it affords? What does it mean that less consumers value a brand’s consistently-quality and authentic goods, and instead value just the appearance of wearing what looks to be a brand’s authentic good? Does this shift in values undermine the pro-consumer justifications behind trademark law’s limited monopoly?

I’m not sure, but it’s an interesting question. To begin looking into it, let’s start by looking at the traditional objectives of trademark law, how they apply when consumers buy a brand’s goods for their quality and authenticity, and then how they apply when consumers buy goods to appear to be wearing a brand’s authentic goods.

Three Objectives of Trademark Law: Justifying the Limited Monopoly

Trademark law gives a company a limited monopoly over its trademarks. It lets a company prevent others from using trademarks that are confusingly-similar to its trademarks. Generally, we think of monopolies as anti-competitive, and anti-consumer interest, but we’re willing to grant this limited monopoly because of how it can actually benefit consumers. There are three objectives of trademark law, and the extent to which these objectives benefit the consumer justifies the limited monopoly we award companies.

First, and most important in my mind, trademark law’s limited monopoly helps protect against harmful consumer confusion. Consumer confusion refers to when consumers cannot correctly identify or differentiate goods as coming from different sources. The harm of consumer confusion is when trying to buy Brand X, because the consumer has bought and enjoyed Brand X in the past, the consumer mistakenly buys Brand Y because it was unable to distinguish between the two, wasting the consumer’s time and money.

Trademarks, and trademark protection, prevent consumer confusion because distinctive trademarks allow consumers to quickly and easily differentiate between brands (“do I like the shoes with the Swoosh or the Three Stripes?”). Standing in the cereal isle, a consumer can make informed purchasing decisions, based off their past experiences with different cereals, just by looking at the trademarks on the different boxes of cereal.

Trademark infringement claims lets Company A stop Company B from using a trademark that is confusingly similar from Company A’s mark. Without this, Company B could put a mark on their goods that are confusingly-similar to a Company A’s popular mark, so that next time a consumer is standing in the cereal isle, they might buy Company B’s good when they meant to buy Company A’s. Without knowing it, when we reflexively grab our favorite brand of cereal, deodorant, or beer based off the trademarks we see on the packaging, we can do so securely because trademark law lets companies stop competitors from using confusingly-similar marks. That’s how trademark protection helps prevent harmful consumer confusion; it makes sure consumers always get what they want, instead of being misled into buying a competitor’s good that might not have the same quality the consumer expected.

Second, trademark law’s limited monopoly can benefit consumers by incentivizing and rewarding companies for producing products of consistent quality and building brand equity. It lets companies cultivate distinctive brands (and hopefully, cultivate good will in their brands), and prevent competitors from free-riding off of their brands (if there’s good will to free-ride off!).

Spending the time and money necessary to cultivate a distinctive brand with good equity is a long term investment, and trademark protection gives companies the security they need for their investment to make sense.

A company can build brand equity over time by (a) ensuring their goods always meet the consistent level of quality consumers want when the consumers makes a purchase based off the company’s trademark, and (b) by providing good customer service (returns, fixes, etc.), generally treating their consumers right, responding to their feedback, and making the effort to have otherwise positive engagement with consumers.

The brand equity that comes from spending the time and money needed for real quality control, good service, and positive engagement pays off for companies over the long run, as they retain happy customers, and these happy customers make referrals.

But, a company can only make these investments because trademark law’s limited monopoly, preventing competitors from using confusingly-similar trademarks to masquerade their own products as the company’s, in attempt to free-ride off the brand equity the company has fostered through investment in quality products and good consumer engagement.

If competitors could free-ride off the company’s investment, the company would have no incentive to invest in the first place. Thus, trademark law’s limited monopoly can benefit consumers by bringing quality products and services to the market.

*Sidebar: this is Hobbes’ state of nature, where no one has property, that is, without laws to create and protect property rights, no one has the incentive or security to invest in the future.*

Third, and a benefit that follows closely behind the first , is that trademarks cut down on research and transaction costs for customers. When we’re in the cereal isle, we feel comfortable immediately grabbing a certain box off the shelf simply based-off the trademark on the box. Whether or not we recognize this every time we take the box off the shelf, trademark law is the reason we can do this, the reason we can comfortably make distinctions between products based solely off the marks on the packaging. As consumers, how do we know the box labeled Fruit Loops is *the* Fruit Loops cereal we want it to be?

*Sidebar: Kellogg actually did go after a golf equipment manufacturer for using a Toucan trademark that Kellogg thought was too similar. The court disagreed, and also (rightfully) didn’t think that the goods in question (cereal and golf equipment) were similar enough to cause confusion. Good decision. Bad attempt at trademark bullying)*

Do we need to secretly open the box to do a taste-check? No. Whether we recognize it or not, simply seeing the marks on the box, the Kellogg word mark, the dastardly and distinctive Toucan Sam, always trying to steal some poor kid’s fruity goodness, these marks are enough to reassure us that this box contains the Fruit Loops we’re looking for. No research, no taste-testing, no calling customer support to make sure. We’re in and out of the isle, on the way home to get our sugar high.

The ability to exclude competitors from using confusingly-similar marks means the trademark is all a consumer needs to see to know exactly what good they’re purchasing. The trademark immediately and unambiguously identifies the source of every box of cereal in the isle, reducing the time and transaction costs consumers expend when shopping, ensuring consumers can feel secure in purchasing decisions.

Justifying Trademark’s Monopoly in the Marketplace for Perceived Appearance

Traditionally, the value of a good came from the qualities of the good itself. Consumers bought one good over another because it was long lasting, made with well stitched fabrics or healthy and natural ingredients, or the consumer simply preferred the taste of one cereal over the other. Whatever the reason, it was something about the good itself the consumer valued. In contrast however, now what’s valuable, what’s being bought and sold, is not something about the good itself, but what that good, or the trademark on that good, communicates to the Other about the owner of that good. Consumers aren’t buying the consistent quality of a good, and therefore aren’t necessarily buying authenticity. Consumers are putting a value onto, and trying to buy the way they appear in the eyes of Others.

The example which first got me wanting to write this article came (long, long ago at this point) from Kanye West, and some DIY knock-off Adidas. In 2016, West wore what looked like Adidas sneakers during a performance on Saturday Night Live, which would make sense, because of West’s relationship with Adidas.

But, it turns out these were actually Vans sneakers, with something resembling Adidas’ iconic three stripes drawn on the side of the shoes. This caused some interesting conversation on trademark twitter. Was this *just* a breach of contract issue between a brand and its designer, who happens to be a popular endorser as well? Or, are there also trademark implications? Did West infringe Adidas’ mark by drawing the stripes on Vans, leading consumers to believe these Vans were actually Adidas? Putting aside any breach of contract implications, is there any consumer harm here that would justify trademark action?

I don’t see the confusion or the harm.

Would consumers be harmed? No, because they wouldn’t be confused as to what they got. They bought exactly what they meant to buy.

Regardless of what brand of shoe West was *actually* wearing, the consumer wouldn’t buy the shoe because it was an authentic Adidas or Van, known for it’s high quality craftsmanship.

Customers would buy the shoe West appeared to wear, because he appeared to wear it. First, regardless of what brand he was actually wearing, they want the brand he was supposed to be wearing. And second, they only want it for the value there is in influencing how they appear to the Other. This isn’t a question of valuing one brand’s quality over another’s, it’s a question of valuing the perceived appearance of wearing one brand over another.

Think of the young basketball player who buys the shoe worn by (or at least endorsed by) his favorite NBA player. What is this consumer buying? A quality brand, or the appearance of being linked with a popular athlete? Framed another way, if a young player’s favorite athlete, Lebron James or Kevin Durant, both Nike Athletes with popular shoe lines, left Nike and went to Adidas (Lebron can’t because he has a lifetime deal)? Would the young basketball player keep buying Nikes without his favorite players there? Some maybe would, but I think most would happily follow them to Adidas. They weren’t buying Nike because it was higher quality than Nike. They were buying it because of what was associated with Nike (their favorite players), and so they valued the appearance of being associated with Nike too.

The consumer is buying a certain appearance in the eyes of the Other, the appearance that the consumer is wearing a Nike, or a Lebron or a KD, and whatever value there is in an association with something or someone which the Other defines as “popular,” “cool,” or even “right” (read the scene in Nausea where the ladies in black are taking solace in the statute set in bronze, it’s page 46 in my copy. Read it, and then read it again).

If the consumer can get the perceived appearance it values from a shoe that costs $50, but looks like a $150 Lebron-endorsed Nike, why not save the $100 bucks and buy a knock-off? The consumer is getting exactly what it wants. Here, the company might be being harmed by a breach of it’s limited monopoly, losing sales to cheaper alternatives, but there’s no harm for the consumer. The consumer wanted to buy the appearance of wearing the shoe Kanye worse, or the one Lebron endorsed, and that’s exactly what they’re buying. They aren’t confused as to what they want, and they buy what it is they wanted, without confusion.

*Sidebar: brands understand this. It’s why Adidas and Nike sell the *real* version of their soccer cleats, the ones Messi and Ronaldo wear, for two or three-hundred dollars, and then cheaper versions for a half or third of the price*

Would Adidas be harmed? On the one hand, Kanye’s DIY still make consumers want to buy Adidas (or what appear to be Adidas), because that’s what Kanye was wearing. On the other hand, what if instead of buying authentic Adidas, consumers buy knock-off or counterfeit Adidas that look enough like what Kanye was wearing. Which would happen because many consumers value the appearance of authenticity over authenticity itself (again, I wouldn’t say all consumers don’t care about authenticity, there are still true sneakerheads out there). A shoe that appears to be an authentic Adidas will do just as well for the consumer as an authentic Adidas.

So, there would be harm to Adidas, diverting sales. Adidas’ limited monopoly over the three stripes would be breached, and the company is being harmed as a result. Should Adidas be able to enforce its rights? Adidas would certainly say so. But it’s consumer interests that justify the limited monopoly of trademark protection.

Is the Other harmed, the person who perceives the buyer as wearing an authentic? The Other a consumer too after all. Harm? Maybe? But probably not. And if they are, this certainly isn’t the point-of-sale confusion trademark protection is about.

What about the second justification for the limited monopoly, that it incentivizes investment in quality and brand equity? I don’t think this stands up any more either, for the same reason consumer confusion no longer works as a justification, because quality and authenticity are secondary now. Consumers don’t buy a pair of shoes for their utility, but to have the appearance of wearing the authentic goods. If the consumer isn’t concerned with consistent quality, is incentivizing consistent quality really a benefit to the consumer? Maybe, but only in a they-don’t-know-what’s-good-for-them or an eat-your-vegetables-because-they’re-good-for-you kind of way. Is trademark law really the place for paternalism? Probably not.

Finally, what about the third justification, that trademark protection lowers transaction costs? If consumers don’t care whether what they buy is necessarily authentic, are they going to care about the transaction costs necessary to authenticate something? Nope.

What does this Mean for Trademark Law’s Limited Monopoly?

Personally, I think the theory and psychology behind trademarks is fascinating. I’ll go so far to say I Love Trademarks. Unfortunately, more and more we see trademarks distorted from their noble and interesting purpose. We have companies who try to abuse trademark law to quash competitors in ways that don’t necessarily benefit consumers, and maybe even hurts consumers. There are even some whose sole purpose is to snap up rights to trademarks and troll others and extract fees for their rights they hold.

But, it’s the anti-competitive abuse of trademarks that makes me wonder if the traditional justifications for trademark protection still hold up.

When quality and authenticity matters to consumers trademark law’s limited monopoly serves consumer interests. The ability to exclude competitors from using a confusingly-similar mark serves to (1) prevent consumer confusion, making sure consumers can get the authentic product they are looking for, (2) makes companies invest in quality goods and goods consumer engagement, and (3) makes it as easy as possible for consumers to immediately and confidently distinguish the cereal they want from the rest of the boxes in the cereal isle.

So long as it’s the quality and authenticity of goods that matters to consumers, the limited monopoly (so long it is actually limited, something courts seem less and less concerned about) benefits consumers enough to justify this otherwise anti-competitive grant.

Does trademark law’s limited monopoly still protect consumer interests? Do the traditional justifications still hold up? What is trademark law today, what will it be tomorrow, and who or what is it meant to protect?*

*DISCLAIMER: I’m not sure I really think there’s some crisis in trademark law, but I think it’s important to stretch the ‘ol thinker with different questions every now and then.