Supreme Court Decides Important Trademark Fair Use Case

On December 8, 2004, the Supreme Court decided an important case regarding the scope of the fair use defense in trademark infringement actions. In KP Permanent Make-Up, Inc. v Lasting Impression I, Inc., 543 U.S. ____(2004), a unanimous Court held that a party raising the affirmative defense of fair use to a claim of trademark infringement does not have the burden to negate any likelihood that the practice complained of will confuse consumers, even if there is "some possibility of consumer confusion." The Court added, however, that the degree of consumer confusion could be a factor in evaluating whether the use is a fair one. The Court's holding resolves a split in the circuits and vacates the decision of the Ninth Circuit (at 328 F.3d 1061 (9th Cir. 2003)), holding that the fair use defense is available only where a defendant can prove no likelihood of confusion.

The decision in the KP case continues the recent line of Supreme Court trademark decisions systematically limiting the use of trademark law to suppress competition. In acknowledging that the law tolerates some possibility of consumer confusion in order to protect the public's access to descriptive terms used in their primary, descriptive sense, the case affirms that trademark law cannot be used to impede the free flow of truthful information required to compete effectively in the marketplace.

Case Summary

The parties to the case are competitors in the micropigmentation, or permanent make-up, industry. Lasting Impression I, Inc. ("Lasting Impression") owns an incontestable federal registration for the mark, MICRO COLORS and Design for color pigments (RN 1769592), registered on the Principal Register in 1993. Petitioner, KP Permanent Make-Up ("KP"), began using the term "micro colors" in 1990 in its promotional materials to describe its selection of pigments; in 1999, KP's advertising materials included the term "micro colors" displayed as part of a stylized header identifying KP's pigment color chart.

Lasting Impression challenged KP's use of "micro colors" and KP sought a declaratory judgment that its use of the term was lawful. Lasting Impression counterclaimed, alleging trademark infringement. KP sought, and the district court granted, summary judgment based on the affirmative defense of fair use. Lasting Impression appealed and the Ninth Circuit reversed, holding that the defense of fair use is available only where a defendant can demonstrate no likelihood of confusion.

The...