In March 2015, McHugh Fuller Law Group, PLLC (“McHugh Fuller”) began running a month-long, statewide Georgia advertising campaign targeting PruittHealth, Inc., f/k/a Pruitt Corporation and its affiliated nursing homes (collectively, “PruittHealth”). Pruitt-Health filed suit against McHugh Fuller under Georgia’s trademark anti-dilution statute, OCGA § 10-1-451 (b), in the Superior Court of Colquitt County, and the trial court entered a permanent injunction prohibiting McHugh Fuller from running ads about PruittHealth that include the company’s trade names, service marks, or logos. As explained below, the single advertisement that PruittHealth challenges did not violate OCGA § 10-1-451 (b). Accordingly, we reverse the trial court’s injunction order.
1. On March 15, 2015, McHugh Fuller, a Mississippi law firm that focuses on suing nursing homes, ran the following full-page, color advertisement in the Sunday print and online editions of the Moultrie Observer newspaper as part of a month-long, statewide ad campaign targeting nursing homes affiliated with PruittHealth, Inc.:
Vickie Patterson, the administrator of PruittHealth-Moultrie for 23 years, andMirandus Ponder, a nursing aide and a lifelong resident of Moultrie, testified that in their view, the March 15 ad in the Moultrie Observer had harmed their facility’s reputation аnd identity in the community. Patterson said that she received multiple text messages about the ad on the day that it ran and that “[pjeople that see this ad that don’t know us would believe that we’re a bad facility.” Ponder said that she learned of the March 15 ad when she was in the checkout line at a grocery store and overheard a woman ask another woman if she had “read the advertisement of PruittHealth abusing their residents.” Ponder added, “I’m there, and I know that [patients are] being taken care of. And it just breaks my heart to have people thinking that that’s what’s going on.”
McHugh Fuller presented numerous exhibits and the testimony of Michael J. Fuller, one of the law firm’s two partners and the person listеd in the March 15 ad as being responsible for its content.
On June 1, 2015, the trial court entered the order on appeal. The court found that
Defendant’s unаuthorized use of Plaintiff’s service marks, trade names and related logos in its advertisements likely tarnish Plaintiff’s and its affiliates’ business reputation [and] likely dilute those marks and names, and that Plaintiff is likely to suffer immediate and irreparable harm to its goodwill and contractual and business relationships through Defendant’s unauthorized use in its advertisements of service marks and trade names used and adopted by Plaintiff, thereby violating OCGA § 10-1-451 (b).
The court permanently enjoined McHugh Fuller from running ads concerning PruittHealth that include PruittHealth’s trade names, service marks, or logos. On June 22, 2015, McHugh Fuller filed a motion to amend or for reconsideration, which the trial court
2. This Court has addressed Georgia’s anti-dilution statute on several occasions. See India-American Cultural Assn., Inc. v. iLink Professionals, Inc.,
Trademark law is part of the broader law of unfair competition. See Moseley v. VSecret Catalogue, Inc.,
In 1946, Congress largely codified traditional trademark infringement law in the Lanham Act, Pub. L. No. 79-489, 60 Stat. 427. But Congress resisted calls to include a cause of action for trademark dilution, which lacks a common-law foundation and is not motivated by an interest in protecting customers. See Moseley,
In 1952, the General Assembly overhauled Georgia’s statutory trademark scheme to conform to the Lanham Act in the Trade-Mark Act of 1952. See Ga. L. 1952, p. 134. See also Derenberg,
OCGA § 10-1-451 (b) says in full:
Every person, assoсiation, or union of working men adopting and using a trademark, trade name, label, or form of advertisement may proceed by action; and all courts having jurisdiction thereof shall grant injunctions to enjoin subsequent use by another of the same or any similar trademark, trade name, label, or form of advertisement if there exists a likelihood of injury to business reputation or of dilution of the distinctive quality of the trademark, trade name, label, or form of advertisement of the prior user, notwithstanding the absence of competition between the parties or of confusion as to the source of goods or services, except that this Code section shall not deprive any party of any vested lawful rights acquired prior to March 4, 1955.
Under this statute, actionable trademark dilution can take two forms:
The first is a “blurring” or “whittling down” of the distinctiveness of a mark. This can occur where the public sees the mark used widely on all kinds of products. The second type of dilution is tarnishment which occurs when a defendant uses the same or similar marks in а way that creates an undesirable, unwholesome, or unsavory mental association with the plaintiff’s mark.
Original Appalachian Artworks, Inc. v. Topps Chewing Gum, Inc., 642 FSupp. 1031, 1039 (N.D. Ga. 1986). See Restatement (Third) of Unfair Competition § 25 (1) (a), (b) (1995) (Mar. 2016 update) (hereinafter Restatement); 4 J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition § 24:67 (4th ed. Mar. 2016 update) (hеreinafter McCarthy); 2 Anne Gilson LaLonde, Gilson on Trademarks § 5A.01 [2] (2016) (hereinafter Gilson). See also 6 Louis Altman & Malla Pollack, Callmann on Unfair Competition, Trademarks and Monopolies § 22:17 (4th ed. June 2016 update) (hereinafter Callmann) (“Dilution threatens two separable but related components of advertising value: it may blur a mark’s product identification, or it may tarnish the affirmative associations a mark has come to convey.” (footnotes omitted)).
At issue in this case is tarnishment, which OCGA § 10-1-451 (b) describes as “subsequent use by another of the same or any similar trademark, trade name, label, or form of advertisement” adopted and used by a person, association, or union “if there exists a likelihood of injury to business reputation ... of the prior user, notwithstanding the absence of competition between the parties or of confusion as to the source of goods or services[.]” See Moseley,
The selling power of a trademark... can be undеrmined by a use of the mark with goods or services such as illicit drugs or pornography that “tarnish” the mark’s image through inherently negative or unsavory associations, or with goods or services that produce a negative response when linked in the minds of prospective purchasers with the goods or services of the prior user, such as the use оn insecticideof a trademark similar to one previously used by another on food products.
Restatement § 25 cmt. c. The basic idea is that “the consumer’s distaste for the unsavory or inferior product has ‘rubbed off’ on the famous trademark, thereby damaging it.” Sandra L. Rierson, The Myth and Reality of Dilution, 11 DukeL. &Tech. Rev. 212,246 (2012).
However, not every unwelcome use of оne’s trademark in the advertising of another provides a basis for a tarnishment claim. See 6 Callmann § 22:19. Tarnishment can occur “only if the defendant uses the designation as its own trademark for its own goods or services.” 4 McCarthy § 24:122. “[C]ases in which a defendant uses the plaintiff’s mark to refer to the plaintiff in a context that harms the plaintiff’s reputation are not properly treated as tarnishment cases.” 2 Gilson § 5A.01 [6]. See Restatement § 25 cmt. i (“[Extension of the antidilution statutes to protect against damaging nontrademark uses raises substantial free speech issues and duplicates other potential remedies better suited to balance the relevant interests.”).
Here, McHugh Fuller was advertising its legаl services to individuals who suspect that their loved ones have been harmed by negligent or abusive nursing home services at a specific PruittHealth nursing home. The ad used PruittHealth’s marks in a descriptive manner to identify the specific PruittHealth facility; indeed, McHugh Fuller was counting on the public to identify PruittHealth-Moultrie by the PruittHealth marks used in the ad. The ad did nоt attempt to link PruittHealth’s marks directly to McHugh Fuller’s own goods or services. McHugh Fuller was advertising what it sells — legal services, which are neither unwholesome nor degrading — under its own trade name, service mark, and logo, each of which appears in the challenged ad. No one reading the ad reproduced above would think that McHugh Fuller was doing anything other than identifying a health care facility that the law firm was willing to sue over its treatment of patients. In short, the ad very clearly was an ad for a law firm and nothing more.
PruittHealth has cited no case analogous to this one to support its position. PruittHealth relies on Original Appalachian Artworks, but there a federal district court found tarnishment under Georgia’s anti-dilution statute because the defendant’s “Garbage Pail Kids” cards and stickers “derisively depictjed] dolls with features similar to [the plaintiff’s] Cabbage Patch Kids dolls in rude, violent and frequently noxious settings.” 642 FSupp. at 1032, 1040. PruittHealth also cites Pillsbury Co. v. Milky Way Productions, Inc., No. C78-679A,
Contrary to PruittHealth’s assertion in the trial court, trademark law does not impose a blanket prohibition on referencing a trademarked name in advertising. “Indeed, it is often virtually impossible to refer to a particular product for purposes of comрarison, criticism, point of reference, or any other such purpose without using the mark.” New Kids on the Block v. News America Publishing Inc., 971 F2d 302, 306 (9th Cir. 1992). Moreover,
Judgment reversed.
Notes
McHugh Fuller objected to consolidating the permanent injunction trial with the interlocutory injunction hearing without allowing full discovery, and the law firm enumerated the triаl court’s denial of that objection as error in its brief on appeal. However, at oral argument, McHugh Fuller explicitly abandoned this challenge to the permanent injunction, so we will not address it further. Cf. McHugh Fuller Law Group, PLLC v. PruittHealth-Toccoa, LLC,
Fuller and his partner James McHugh are members of the Georgia Bar.
In 1996, Congress amended the Lanham Act to include a federal cause of action for trademark dilution. See Federal Trademark Dilution Act of 1995 (FTDA), Pub. L. No. 104-98, 109 Stat. 985. In 2006, Congress substantially revised the FTDA. See Trademark Dilution Revision Act of2006 (TDRA), Pub. L. No. 109-312,120 Stat. 1730 (codified at 15 USC § 1125 (c)). PruittHealth did not include a federal trademark dilution claim in its complaint against McHugh Fuller.
In light of this conclusion, we need not decide whether, as McHugh Fuller contends, OCGA § 10-1-451 (b) includes an implicit fair use defense like the express defense in the federal TDRA. See 15 USC § 1125 (c) (3).