The Normative Foundations of Trademark Law

This paper challenges the conventional wisdom that trademark law traditionally sought to protect consumers and enhance marketplace efficiency. Contrary to widespread contemporary understanding, early trademark cases were decidedly producer-centered. Trademark infringement claims, like all unfair competition claims, were intended to protect producers from illegitimate attempts to divert their trade. Consumer deception was relevant in these cases only to the extent it was the means by which a competitor diverted a producer's trade. Moreover, American courts from the very beginning protected a party against improperly diverted trade in part by recognizing a narrow form ofproperty rights in trademarks. Those rights were derived from the natural rights theory of property that predominated in the nineteenth century and were defined quite narrowly. Reframing traditional trademark law in this way leads to two important conclusions. First, although the broad forms of protection trademark law now provides deserve sustained scrutiny, any criticisms leveled against modern doctrines must stand on their own merits and fairly confront the policy goals of modern trademark law. The criticisms cannot draw their normative force by pointing to information transmission principles that did not animate traditional trademark law. Second, and somewhat counterintuitively, expansion of trademark law in the twentieth century was more a consequence of the modern search cost rationale than a deviation from that model. Traditional trademark law contained very specific and workable restrictions on the scope of trademark protection that were weakened or rejected in the twentieth century as courts and commentators embraced the information transmission model. The limitations counted on by proponents of the new model have proven almost infinitely pliable and have failed to halt trademark law's growth.