Unlike the traditional cause of action under trademark law, dilution theory protects not the consumer but rather the value of the trademark to the trademark holder.
The addition of dilution theory to the federal trademark law arena was a legislative act of particular moment to trademark holders,
representing significant developments in the history of trademark and an evolutionary shift in the focus of trademark protection. With the advent of the federal Dilution Act, the courts have an opportunity to carefully examine the underlying theoretical and statutory bases for tarnishment and blurring liability, and to develop an analytical framework that rationally furthers the statutory objectives of the Act.
More significantly, in October 2006, the U.S. Congress passed the Trademark Dilution Revision Act (TDRA), replacing the actual dilution standard with a likelihood of dilution standard. This new TDRA is a landmark law, which steps forward to a higher level of trademark protection in the U.S. As the International Trademark Association described, passage of the TDRA is a "very important achievement in the protection of famous and well-known trademarks" and "provides brand owners a powerful tool for protecting the trademarks they have worked so hard to build."
2.2. Trademark Legislation in China
The old PRC Trademark Laws mainly are the 1982 Trademark Law and 1995 Trademark Implementing Regulations. The former was based upon a first-to-file system to obtain trademark rights. With China''s accession to WTO, China sought to comply with international standards on IPR protection by signing onto international and multinational treaties and conventions, thus China joined the 1996 Implementation Policy for the Madrid International Registration.
However, China was complained to have an insufficient mechanism for trademark''s protection. There was criticism that China''s trademark protection system failed to provide adequate enforcement against trademark infringement. Moreover, with its rapid development, China is more and more aware of the fact that respect for well-known marks is central to their economic reform. As a result, both the Trademark Law and Implementing Regulations were revised in 1993.
Unfortunately, the amended laws still failed to meet international standards. In order to conform more closely to international standards and meet its obligations under TRIPS, the Trademark Law was amended for the second time on October 27, 2001.
Therefore, at present, there have been three new regulations promulgated to strengthen its protection for well-known marks in China: the 1996 Implementation Policy for the Madrid International Registration, the 2001 Trademark Law of the People''s Republic of China (2001Trademark Law) and the 2002 Implementing Regulations of the Trademark Law (Implementing Regulations).
The 2001 Trademark Law provides a claim for priority in accordance with the Paris Convention. It addresses that both enterprises and individuals are eligible to apply for trademark registration. Besides, it also shifted the power of disputes'' final adjudication from an administrative mechanism to a judicial mechanism.
The new mechanism provides for judicial review of all Trademark Review and Adjudication Board (TRAB) decisions, including cases involving the validity of trademark registration, allowing parties to institute legal proceedings if they are dissatisfied with the decision of the TRAB.
Particularly, pursuant to Article 13, trademarks that are considered "well-known" in China are afforded a greater scope of protection.
Yet, there hasn''t been a definition of well-known mark under the new law, rather, there are merely a series of factors for the court or relevant administration agency to consider. But the legislation in China does continue to mature with the adoption of new laws and regulations to protect the rights of well-known mark owners, long called for by outside observers as a necessary improvement to trademark''s legislation.
By and large, the trademark legislative history in the United States and China has fundamental differences. On the part of the United States, the establishment of dilution theory in the trademark legislation indicates that it put high priority to merchants'' interests. A stronger protection is offered to companies which have gained "well-known" such an intangible asset. While with regard to China, it is in the earliest stage of well-known mark''s protection. Much is left to be desired. Basically, well-known mark''s protection in China is merely in compliance with international treaties with flexible requirements in well-known mark''s protection, e.g. TRIPS. And it is confusion-based protection, favoring the position of the general public.
