The German Misappropriation Origins of Trademark Antidilution Doctrine: A Translation of the 1924OdolOpinion of the Elberfeld Landgericht

As a full reading of the Elberfeld Landgericht's Odol opinion will confirm, trademark dilution, at least in its origins, was a misappropriation law concept rather than a trademark law concept. The Odol court did not speak of anything like "search costs,,6 or "imagination cost,"7 or of "blurring"S or "tarnishment."9 Instead, with reference to the defendant's conduct, the essence of the court's holding was that "[ilt is contrary to good morals to appropriate the fruits of another's labor in this manner, knowing that the other will or could be harmed by doing so.",o Indeed, in the final paragraph of the opinion, the Odol court explicitly stated that having resolved the matter before it under German misappropriation law, "it is not necessary to examine whether the complainant's claims are also justified on the basis of trademark law."" In short, Odol was a misappropriation case in which the misappropriated property at issue happened to be a trademark.

But Schechter sought in various ways to conceal the fact that antidilution protection was a form of misappropriation law. For example, though he provided a lengthy block quotation from the Odol opinion in the conclusion of his "Rational Basis" article,12 there is one sentence from the opinion that he appears deliberately to have replaced with an internal ellipsis: the sentence quoted above stating the essence of the court's holding that the defendant had misappropriated the fruits of another's labor.

Why would Schechter have sought to obscure antidilution protection's true genealogy? As explained in detail elsewhere,'3 Schechter was writing at the time to a legal community increasingly under the influence of American Legal Realism, particularly at his intellectual home, Columbia Law School. Exponents of legal realism were openly contemptuous of the majority in International News Service. More generally, Schechter likely sought to obscure the degree to which the antidilution doctrine he was promulgating in his "Rational Basis" article was essentially formalist in nature. 16 This may help to explain why in "Rational Basis" Schechter offered so many different formulations of the concept of trademark dilution, some of them not always consistent with each other. 17 But Schechter's contemporaries saw through his ruse. Felix Cohen's 1935 article "Transcendental Nonsense and the Functional Approach" remains one of the most important and influential works of American Legal Realism. 18 In it, Cohen levelled a scathing attack on "Rational Basis," accusing it of "economic prejudice masquerading in the cloak of legallogic"'9 and repeatedly using the phrase "vicious circle" to describe Schechter's purportedly circular reasoning."" Other scholars, even those sympathetic to it, similarly recognized the basic formalism of Schechter's version of antidilution protection. 2l But Schechter's efforts at disguise did eventually succeed in at least one respect. The many different definitions of trademark dilution that appear in "Rational Basis" sufficiently confused the concept that it would become, at least for subsequent generations of trademark lawyers, a great mystery as to what exactly trademark dilution is. Further complicating matters was that Elberfeld Landgericht's opinion in Odol formulated the concept of trademark dilution both in terms of the tort of misappropriation and a potential violation of unfair competition law. Into the void of meaning could flow incoherent concepts like trademark blurring and trademark tamishment and the inane notion that antidilution protection ultimately seeks to minimize consumers' "imagination costs."'" Perhaps a return to the clear and straightforward discussion of the concept originally offered by the Odol court will help to clarify that trademark antidilution law is essentially misappropriation law -'5 ld. at 239. ,6 See Beebe, supra note 4> at 75 (discussing "the essentially fonnalist spirit of Schechter's proposed test for dilution -which would simply ask (1) does the plainti!!'s mark qualify for antidilution protection by virtue of its inherent distinctiveness and fame, and (2) is the defendanfs mark identical or closely similar to the plaintifl's mark?" n See Ty, Inc. v. Perryman, 306 F'3d 509, 5" (7th Cir. 2002).

albeit one that, as Graeme Dinwoodie has emphasized, is best understood within the broader context of unfair competition law"3 -and perhaps this will help clarify for American courts exactly why so many of them, "all realists now,""'! are reluctant to grant antidilution protection.

Odol May Not Be Permitted To Be Used Even for Goods Entirely Dissimilar to Mouthwash.

Decision of the District Court of Elberfeld, '4 September '924, 13. 0 . 8 9'24.

Facts 1 The complainant filed suit requesting the court to order the respondent to consent to the cancellation of the word mark registered at the patent office under the file number M 35877'9b Wz in connection with the respondent's business operation, a steel goods factory, and its goods, which include cutlery and cutting tools, to order the respondent to compensate the complainant for all damages it has incurred or will incur from the respondent's use of the mark "Odol," and finally to prohibit the respondent under threat of penalty from affixing the mark "Odol" to its goods and their packaging or wrapping, from placing goods thus labeled on the market, and from affixing the mark on its announcements, price lists, business letters, remittances, invoices, and the like.

2 The complainant asserted that the wordmark "Odol" was registered to it on 5 March 1895 on the trademark register and has been used by the complainant since that time as a mark for its mouthwash and toothpaste. had filed for registration of the wordmark "Odol" for its business operation, a steel goods factory, and for its goods, which include cutlery and cutting tools and skin care and nail care articles. The registration was granted, except with respect to skin care and nail care articles. However, the complainant requested that the remaining registration also be cancelled. The respondent requested that the complaint be dismissed. Documents relating to the protection of the complainant's wordmark are attached. The written submissions are referenced.

Grounds for the Decision 3 The court considers the complaint to be well-grounded in S 826 of the Civil Code.

4 After the complainant proved that the word "Odol" had long since been registered to it as a trademark, the respondent no longer contested this fact. It is furthermore known to the court that the complainant firm and the mouthwash it produces are referred to by the name "ado!." It can therefore well be said that the word "Odol" developed into a catchword that has come to distinguish the complainant's goods and has acquired an advertising strength that goes beyond the otherwise typical function of trademarks, such that when anyone reads or hears the word "Odol," they think of the complainant's mouthwash. These facts are of the utmost importance for the complainant firm: their goods have a good reputation, and any goods bearing the name "Odol" can presume to have the reputation among the public of being of high quality.

5 As a result, the complainant has the greatest interest in ensuring that its mark not become diluted; it would lose in advertising strength if everyone were to use it to designate their goods. The trademark will become devalued, if it is used for other, wholly different goods. 5 Die Klagerin hat infolgedessen das groj3te Interesse daran, daj3 ihr Zeichen nicht verwassert wird; es wiirde an Werbekrafl: einbiij3en, wenn jedermann es zur Bezeichnung seiner Waren verwenden wiirde. Das Warenzeichen wird fur die Waren der Klagerin entwertet, wenn es fur andere ganzlich verschiedene Waren verwendet wird. steel goods with the obvious intention to profit from the strength of the mark for the distribution of its goods. There are, of course, innumerable fine-sounding words that the respondent could have used to designate its goods; in choosing precisely the word "Odol," it is clear that the respondent did so because the mark has acquired an especially good reputation as a result of the efforts of the complainant. The respondent furthermore must have recognized, and surely did, that there was at least a possibility that its actions would cause damage to the complainant. Knowing this, the respondent had its mark registered nonetheless; that is to say, it behaved at least with reckless intent. It is contrary to good morals to appropriate the fruits of another's labor in this manner, knowing that the other will or could be harmed by doing so. Also the respondent must recognize that when anyone calls his goods "Odol," the word "Odol" loses value for the complainant.

7 To be sure, the parties cannot be said to stand in competition with one another due to the completely different nature of the goods they sell. This, however, is beside the point. The respondent advertised its products by means of a word with strong appeal that had acquired this appeal precisely through the years-long and extensive activity of the complainant. Paragraph S 1 of the Law against Unfair Competition can also serve to support the claim, because this legal provision does not require that the company acting contrary to good morals stand in competition with the company seeking an injunction and damages. Instead, it is enough that the company against which claims have been asserted intervenes in a manner that hinders competition between two competitors (see Rosenthal Note 63 at S 1). Here, however, the complainant's ability to compete, specifically its ability to compete