The Hidden Boundaries: Unpacking the Limits of Dominant Acts in Shaping IP Law

By Hannah Steinberg
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In our visually expressive world, logos, symbols, and designs are often the governing force in an identification of a person, brand, or place. These trademarks often function as the key to success for companies and individuals as it allows for an increase in profitability and fame. The laws of intellectual property govern the protection and regulation of such trademarks, primarily using the Lanham Act, established by Congress in 1946.

The Lanham Act establishes a system for national trademark registration and subsequently protects the owners of registered trademarks from the use of similar marks if such use allows for consumer confusion or “dilutes” the famous mark [1]. However, the act only protects trademarks that meet the following requirements:used for commercial purposes, distinct in nature and appearance, and  the trademark must not be integral to a product’s functionality. This is derived from the functionality doctrine which protects competitors from functional product features being trademarks. 

Recently, a suit was filed by Michael McKenzie, an art publisher who is often recognized by his trademark - the "LOVE" image. Mckenzie filed the suit against the Artists Rights Society (ARS), a group that manages artist copyrights. McKenzie accused them of falsely claiming they had the copyright to the "LOVE" image and fraudulently selling licenses for it,which hurt his ability to promote a similar image he worked on with Indiana, called "HOPE" [2]. 

As this causes consumer confusion, McKenzie sued under the Lanham Act. However, the judge, Jennifer H. Rearden dismissed McKenzie’s lawsuit, a decision that highlights the Lanham Act’s limitations in ensuring trademarks are lawfully protected. McKenzie argued that the ARS misled people by claiming they had a copyright for the "LOVE" image, and he said this tricked potential customers into choosing the "LOVE" image over his "HOPE" image, leading to a loss in commerce. Yet, the judge found that McKenzie didn’t prove that people were actually deceived or that this deception caused him to lose business. Thus, as the Lanham Act only protects trademarks that are used in commerce, McKenzie is noneligible for guaranteed protection. 

Furthermore, Judge Rearden said McKenzie’s claims were too late as he had known about these issues regarding the licensing with the image since at least 2007 but waited until 2022 to file the lawsuit. As courts in the circuit apply New York's six-year statute of limitations for fraud to Lanham Act designation of origin and false advertising claims, this was another reason his case fell short of being protected by the Lanham Act.

Furthermore, McKenzie also attempted to sue under the Racketeer Influenced and Corrupt Organizations Act (RICO). RICO is a federal law that targets organized crime by enhancing penalties and creating new legal actions for crimes committed as part of a criminal enterprise. To convict under RICO, prosecutors must prove a "pattern of racketeering," defined as at least two related criminal acts within 10 years. RICO also allows private individuals harmed by racketeering to sue for triple the damages they suffered [3]. McKenzie claimed that the ARS was engaging in a fraudulent scheme to sell licenses for the "LOVE" image and thus could sue for such damages under RICO. Nevertheless, his claims under RICO were inapplicable as Judge Rearden ruled in an opinion and order that McKenzie didn’t claim a direct link between the ARS' alleged actions and any financial harm he suffered. Judge Rearden also wrote that he missed the applicable four-year statute of limitations for cases dealing with RICO.

While art is one’s precious property, it is also made to be impressionable and influence future creations, this reality being the thin line that IP law has to respect. This case, McKenzie v. Artists Rights Society, Inc. et al, is just one example of cases dealing with trademarks that fail to be protected by the Lanham Act. These guidelines of IP law may appear to be strict, however, they are simply just allowing art to be shared and passed, its main function for thousands of years in the past and to come. 

The opinions and views expressed in this publication are the opinions of the designated authors and do not reflect the opinions or views of the Penn Undergraduate Law Journal, our staff, or our clients.

[1] “Lanham Act,” LII / Legal Information Institute, n.d., https://www.law.cornell.edu/wex/lanham_act#:~:text=The%20Act%20provides%20for%20a,mark%20is%20likely%20to%20occur.
[2] JENNIFER H. REARDEN et al., “OPINION & ORDER,” OPINION & ORDER, UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK, 2022, https://assets.law360news.com/2262000/2262352/https-ecf-nysd-uscourts-gov-doc1-127136499557.pdf.
[3] “Racketeer Influenced and Corrupt Organizations Act (RICO),” LII / Legal Information Institute, n.d., https://www.law.cornell.edu/wex/racketeer_influenced_and_corrupt_organizations_act_(rico).
[4] “Art Org. Freed From Suit Over Fake ‘LOVE’ Copyright Claim - Law360,” n.d., https://www.law360.com/ip/articles/2262352/art-org-freed-from-suit-over-fake-love-copyright-claim.